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Document And Entity Information (USD $)
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6 Months Ended | |
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Jun. 30, 2011
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Aug. 03, 2011
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| Document and Entity Information [Abstract] | ||
| Entity Registrant Name | CONSUMER PORTFOLIO SERVICES INC | |
| Document Type | 10-Q | |
| Current Fiscal Year End Date | --12-31 | |
| Entity Common Stock, Shares Outstanding | 19,814,761 | |
| Entity Public Float | $ 18,740,264 | |
| Amendment Flag | false | |
| Entity Central Index Key | 0000889609 | |
| Entity Current Reporting Status | Yes | |
| Entity Voluntary Filers | No | |
| Entity Filer Category | Smaller Reporting Company | |
| Entity Well-known Seasoned Issuer | No | |
| Document Period End Date | Jun. 30, 2011 | |
| Document Fiscal Year Focus | 2011 | |
| Document Fiscal Period Focus | Q2 |
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- Details
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- Definition
If the value is true, then the document as an amendment to previously-filed/accepted document. No definition available.
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- Definition
End date of current fiscal year in the format --MM-DD. No definition available.
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- Definition
This is focus fiscal period of the document report. For a first quarter 2006 quarterly report, which may also provide financial information from prior periods, the first fiscal quarter should be given as the fiscal period focus. Values: FY, Q1, Q2, Q3, Q4, H1, H2, M9, T1, T2, T3, M8, CY. No definition available.
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- Definition
This is focus fiscal year of the document report in CCYY format. For a 2006 annual report, which may also provide financial information from prior periods, fiscal 2006 should be given as the fiscal year focus. Example: 2006. No definition available.
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- Definition
The end date of the period reflected on the cover page if a periodic report. For all other reports and registration statements containing historical data, it is the date up through which that historical data is presented. If there is no historical data in the report, use the filing date. The format of the date is CCYY-MM-DD. No definition available.
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- Definition
The type of document being provided (such as 10-K, 10-Q, N-1A, etc). The document type is limited to the same value as the supporting SEC submission type, minus any "/A" suffix. The acceptable values are as follows: S-1, S-3, S-4, S-11, F-1, F-3, F-4, F-9, F-10, 6-K, 8-K, 10, 10-K, 10-Q, 20-F, 40-F, N-1A, 485BPOS, 497, NCSR, N-CSR, N-CSRS, N-Q, 10-KT, 10-QT, 20-FT, POS AM and Other. No definition available.
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- Definition
A unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Indicate number of shares outstanding of each of registrant's classes of common stock, as of latest practicable date. Where multiple classes exist define each class by adding class of stock items such as Common Class A [Member], Common Class B [Member] onto the Instrument [Domain] of the Entity Listings, Instrument No definition available.
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- Definition
Indicate "Yes" or "No" whether registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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- Definition
Indicate whether the registrant is one of the following: (1) Large Accelerated Filer, (2) Accelerated Filer, (3) Non-accelerated Filer, or (4) Smaller Reporting Company. Definitions of these categories are stated in Rule 12b-2 of the Exchange Act. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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- Definition
State aggregate market value of voting and non-voting common equity held by non-affiliates computed by reference to price at which the common equity was last sold, or average bid and asked price of such common equity, as of the last business day of registrant's most recently completed second fiscal quarter. The public float should be reported on the cover page of the registrants form 10K. No definition available.
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- Definition
The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Indicate "Yes" or "No" if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. No definition available.
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- Definition
Indicate "Yes" or "No" if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Is used on Form Type: 10-K, 10-Q, 8-K, 20-F, 6-K, 10-K/A, 10-Q/A, 20-F/A, 6-K/A, N-CSR, N-Q, N-1A. No definition available.
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- Details
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- Definition
Sum of the carrying values as of the balance sheet date of obligations incurred through that date and due within one year (or the operating cycle, if longer), including liabilities incurred (and for which invoices have typically been received) and payable to vendors for goods and services received, taxes, interest, rent and utilities, accrued salaries and bonuses, payroll taxes and fringe benefits. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount owed to the reporting entity by counterparties in securitized loan transactions. No definition available.
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- Definition
Interest, dividends, rents, ancillary and other revenues earned but not yet received by the entity on its investments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Accumulated change in equity from transactions and other events and circumstances from non-owner sources, net of tax effect, at period end. Excludes Net Income (Loss), and accumulated changes in equity from transactions resulting from investments by owners and distributions to owners. Includes foreign currency translation items, certain pension adjustments, unrealized gains and losses on certain investments in debt and equity securities, other than temporary impairment (OTTI) losses related to factors other than credit losses on available-for-sale and held-to-maturity debt securities that an entity does not intend to sell and it is not more likely than not that the entity will be required to sell before recovery of the amortized cost basis, as well as changes in the fair value of derivatives related to the effective portion of a designated cash flow hedge. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Details
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- Definition
Includes currency on hand as well as demand deposits with banks or financial institutions. It also includes other kinds of accounts that have the general characteristics of demand deposits in that the Entity may deposit additional funds at any time and also effectively may withdraw funds at any time without prior notice or penalty. Cash equivalents, excluding items classified as marketable securities, include short-term, highly liquid investments that are both readily convertible to known amounts of cash, and so near their maturity that they present minimal risk of changes in value because of changes in interest rates. Generally, only investments with original maturities of three months or less qualify under that definition. Original maturity means original maturity to the entity holding the investment. For example, both a three-month US Treasury bill and a three-year Treasury note purchased three months from maturity qualify as cash equivalents. However, a Treasury note purchased three years ago does not become a cash equivalent when its remaining maturity is three months. Compensating balance arrangements that do not legally restrict the withdrawal or usage of cash amounts may be reported as Cash and Cash Equivalents, while legally restricted deposits held as compensating balances against borrowing arrangements, contracts entered into with others, or company statements of intention with regard to particular deposits are not generally reported as cash and cash equivalents. Includes cash and cash equivalents associated with the entity's continuing operations. Excludes cash and cash equivalents associated with the disposal group (and discontinued operation). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Represents the caption on the face of the balance sheet to indicate that the entity has entered into (1) purchase or supply arrangements that will require expending a portion of its resources to meet the terms thereof, and (2) is exposed to potential losses or, less frequently, gains, arising from (a) possible claims against a company's resources due to future performance under contract terms, and (b) possible losses or likely gains from uncertainties that will ultimately be resolved when one or more future events that are deemed likely to occur do occur or fail to occur. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate par or stated value of issued nonredeemable common stock (or common stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable common shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Net amount of long-term deferred finance costs capitalized at the end of the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The noncurrent portion as of the balance sheet date of the aggregate carrying amount of all future tax deductions arising from temporary differences between tax basis and generally accepted accounting principles basis recognition of assets, liabilities, revenues and expenses, which can only be deducted for tax purposes when permitted under enacted tax laws; after the valuation allowance, if any, to reduce such amount to net realizable value. Deferred tax liabilities and assets are classified as current or noncurrent based on the classification of the related asset or liability for financial reporting. A deferred tax liability or asset that is not related to an asset or liability for financial reporting, including deferred tax assets related to carryforwards, is classified according to the expected reversal date of the temporary difference. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of the recorded investment in a contractual right to receive money on demand or on fixed or determinable dates that is recognized as an asset in the creditor's statement of financial position. Examples include, but are not limited to, accounts receivable (with terms exceeding one year), notes receivable and receivables relating to lessor's rights to payments from leases other than operating leases that have been recorded as assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
A valuation allowance for financing receivables that are expected to be uncollectible. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total of all Liabilities and Stockholders' Equity items (or Partners' Capital, as applicable), including the portion of equity attributable to noncontrolling interests, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The carrying value as of the balance sheet date of the current portion of long-term obligations drawn from a line of credit, which is a bank's commitment to make loans up to a specific amount. Examples of items that might be included in the application of this element may consist of letters of credit, standby letters of credit, and revolving credit arrangements, under which borrowings can be made up to a maximum amount as of any point in time conditional on satisfaction of specified terms before, as of and after the date of drawdowns on the line. Includes short-term obligations that would normally be classified as current liabilities but for which (a) postbalance sheet date issuance of a long term obligation to refinance the short term obligation on a long term basis, or (b) the enterprise has entered into a financing agreement that clearly permits the enterprise to refinance the short-term obligation on a long term basis and the following conditions are met (1) the agreement does not expire within 1 year and is not cancelable by the lender except for violation of an objectively determinable provision, (2) no violation exists at the BS date, and (3) the lender has entered into the financing agreement is expected to be financially capable of honoring the agreement. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
An amount representing an agreement for an unconditional promise by the maker to pay the Company (holder) a definite sum of money within one year from the balance sheet date (or the normal operating cycle, whichever is longer), net of any write-downs taken for collection uncertainty on the part of the holder. Such amount may include accrued interest receivable in accordance with the terms of the debt. The debt also may contain provisions and related items including a discount or premium, payable on demand, secured, or unsecured, interest bearing or noninterest bearing, among a myriad of other features and characteristics. This amount does not include amounts related to receivables held-for-sale. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount for notes payable (written promise to pay), due to related parties. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate carrying amount, as of the balance sheet date, of noncurrent assets not separately disclosed in the balance sheet. Noncurrent assets are expected to be realized or consumed after one year (or the normal operating cycle, if longer). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Secured financing other than securities sold under agreements to repurchase and securities loaned. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate par or stated value of issued nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable preferred shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Tangible assets that are held by an entity for use in the production or supply of goods and services, for rental to others, or for administrative purposes and that are expected to provide economic benefit for more than one year; net of accumulated depreciation. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The carrying amounts of cash and cash equivalent items which are restricted as to withdrawal or usage. Restrictions may include legally restricted deposits held as compensating balances against short-term borrowing arrangements, contracts entered into with others, or entity statements of intention with regard to particular deposits; however, time deposits and short-term certificates of deposit are not generally included in legally restricted deposits. Excludes compensating balance arrangements that are not agreements which legally restrict the use of cash amounts shown on the balance sheet. For a classified balance sheet represents the current portion only (the noncurrent portion has a separate concept); there is a separate and distinct element for unclassified presentations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The cumulative amount of the reporting entity's undistributed earnings or deficit. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Carrying value as of the balance sheet date , including the current and noncurrent portions, of collateralized debt obligations (with maturities initially due after one year or beyond the operating cycle, if longer). Such obligations include mortgage loans, chattel loans, and any other borrowings secured by assets of the borrower. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Including the current and noncurrent portions, carrying value as of the balance sheet date of subordinated debt (with initial maturities beyond one year or beyond the operating cycle if longer). Subordinated debt places a lender in a lien position behind debt having a higher priority of repayment in liquidation of the entity's assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $)
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Jun. 30, 2011
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Dec. 31, 2010
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|---|---|---|
| Preferred Stock par value (in Dollars per share) | $ 1 | $ 1 |
| Preferred Stock shares authorized | 5,000,000 | 5,000,000 |
| Preferred Stock shares issued | 0 | 0 |
| Common stock par value (in Dollars per share) | $ 0 | $ 0 |
| Common stock shares authorized | 75,000,000 | 75,000,000 |
| Common stock shares issued | 19,921,518 | 18,122,810 |
| Common stock shares outstanding | 19,921,518 | 18,122,810 |
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Series A Preferred Stock [Member]
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| Preferred Stock par value (in Dollars per share) | $ 1 | $ 1 |
| Preferred Stock shares authorized | 5,000,000 | 5,000,000 |
| Preferred Stock shares issued | 0 | 0 |
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Series B Preferred Stock [Member]
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| Preferred Stock par value (in Dollars per share) | $ 1 | $ 1 |
| Preferred Stock shares authorized | 1,870 | 1,870 |
| Preferred Stock shares issued | 1,870 | 1,870 |
| Series B convertible preferred stock shares outstanding | 1,870 | 1,870 |
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- Definition
Face amount or stated value of common stock per share; generally not indicative of the fair market value per share. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The maximum number of common shares permitted to be issued by an entity's charter and bylaws. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total number of common shares of an entity that have been sold or granted to shareholders (includes common shares that were issued, repurchased and remain in the treasury). These shares represent capital invested by the firm's shareholders and owners, and may be all or only a portion of the number of shares authorized. Shares issued include shares outstanding and shares held in the treasury. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total number of shares of common stock held by shareholders. May be all or portion of the number of common shares authorized. These shares represent the ownership interest of the common shareholders. Shares outstanding equals shares issued minus shares held in treasury and other adjustments, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Face amount or stated value per share of nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer); generally not indicative of the fair market value per share. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The maximum number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) permitted to be issued by an entity's charter and bylaws. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) issued to shareholders (includes related preferred shares that were issued, repurchased, and remain in the treasury). May be all or portion of the number of preferred shares authorized. Excludes preferred shares that are classified as debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate share number for all nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer) held by stockholders. Does not include preferred shares that have been repurchased. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Thousands, except Share data, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2011
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Jun. 30, 2010
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Jun. 30, 2011
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Jun. 30, 2010
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| Interest income | $ 27,812 | $ 35,178 | $ 56,396 | $ 74,147 |
| Servicing fees | 1,130 | 1,963 | 2,545 | 4,351 |
| Other income | 2,212 | 1,387 | 4,608 | 4,619 |
| 31,154 | 38,528 | 63,549 | 83,117 | |
| Employee costs | 7,461 | 8,697 | 15,085 | 17,475 |
| General and administrative | 3,772 | 5,579 | 7,411 | 11,454 |
| Interest | 19,241 | 18,775 | 38,367 | 43,242 |
| Provision for credit losses | 4,360 | 6,990 | 8,052 | 18,706 |
| Marketing | 1,839 | 726 | 3,434 | 1,505 |
| Occupancy | 762 | 760 | 1,523 | 1,540 |
| Depreciation and amortization | 162 | 170 | 326 | 299 |
| 37,597 | 41,697 | 74,198 | 94,221 | |
| Loss before income tax expense | (6,443) | (3,169) | (10,649) | (11,104) |
| Income tax expense | 3,600 | 3,600 | ||
| Net loss | $ (6,443) | $ (6,769) | $ (10,649) | $ (14,704) |
| Basic (in Dollars per share) | $ (0.35) | $ (0.39) | $ (0.58) | $ (0.83) |
| Diluted (in Dollars per share) | $ (0.35) | $ (0.39) | $ (0.58) | $ (0.83) |
| Basic (in Shares) | 18,421 | 17,450 | 18,272 | 17,642 |
| Diluted (in Shares) | 18,421 | 17,450 | 18,272 | 17,642 |
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- Definition
The current period expense charged against earnings on long-lived, physical assets not used in production, and which are not intended for resale, to allocate or recognize the cost of such assets over their useful lives; or to record the reduction in book value of an intangible asset over the benefit period of such asset; or to reflect consumption during the period of an asset that is not used in production. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate direct operating costs incurred during the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate total of expenses of managing and administering the affairs of an entity, including affiliates of the reporting entity, which are not directly or indirectly associated with the manufacture, sale or creation of a product or product line. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
Sum of operating profit and nonoperating income or expense before Income or Loss from equity method investments, income taxes, extraordinary items, and noncontrolling interest. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The sum of the current income tax expense or benefit and the deferred income tax expense or benefit pertaining to continuing operations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The cost of borrowed funds accounted for as interest that was charged against earnings during the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Income derived from investments in debt securities and on cash and cash equivalents the earnings of which reflect the time value of money or transactions in which the payments are for the use or forbearance of money. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Amount of net occupancy expense that may include items, such as depreciation of facilities and equipment, lease expenses, property taxes and property and casualty insurance expense. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The total amount of other operating income, the components of which are not separately disclosed on the income statement, from items that are associated with the entity's normal revenue producing operation. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The sum of the periodic provision charged to operations, based on an assessment of the uncollectibility of the loan and lease portfolio, the offset to which is either added to or deducted from the allowance account for the purpose of reducing loan receivable and leases to an amount that approximates their net realizable value (the amount expected to be collected). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
Aggregate revenue recognized during the period (derived from goods sold, services rendered, insurance premiums, or other activities that constitute an entity's earning process). For financial services companies, also includes investment and interest income, and sales and trading gains. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
Expenditures for salaries other than officers. Does not include allocated share-based compensation, pension and post-retirement benefit expense or other labor-related non-salary expense. For commercial and industrial companies, excludes any direct and overhead labor that is included in cost of goods sold. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The aggregate total amount of expenses directly related to the marketing or selling of products or services. No definition available.
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| X | ||||||||||
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- Definition
Income from servicing real estate mortgages, credit cards, and other financial assets held by others. Also include any premiums received in lieu of regular servicing fees on such loans only as earned over the life of the loans. May also be net of any related impairment of fair value of capitalized service costs. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The average number of shares or units issued and outstanding that are used in calculating diluted EPS or earnings per unit (EPU), determined based on the timing of issuance of shares or units in the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
Number of [basic] shares or units, after adjustment for contingently issuable shares or units and other shares or units not deemed outstanding, determined by relating the portion of time within a reporting period that common shares or units have been outstanding to the total time in that period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The component of interest expense representing the noncash expenses charged against earnings in the period to amortize debt discount and premium associated with the related debt instruments. Excludes amortization of financing costs. Alternate caption: Noncash Interest Expense. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The amount of amortization of deferred charges applied against earnings during the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The component of interest expense comprised of the periodic charge against earnings over the life of the financing arrangement to which such costs relate. Alternate captions include Noncash Interest Expense. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The component of interest expense representing the noncash expenses charged against earnings in the period to allocate debt discount and premium, and the costs to issue debt and obtain financing over the related debt instruments. Alternate captions include Noncash Interest Expense. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
Includes currency on hand as well as demand deposits with banks or financial institutions. It also includes other kinds of accounts that have the general characteristics of demand deposits in that the Entity may deposit additional funds at any time and also effectively may withdraw funds at any time without prior notice or penalty. Cash equivalents, excluding items classified as marketable securities, include short-term, highly liquid investments that are both readily convertible to known amounts of cash, and so near their maturity that they present minimal risk of changes in value because of changes in interest rates. Generally, only investments with original maturities of three months or less qualify under that definition. Original maturity means original maturity to the entity holding the investment. For example, both a three-month US Treasury bill and a three-year Treasury note purchased three months from maturity qualify as cash equivalents. However, a Treasury note purchased three years ago does not become a cash equivalent when its remaining maturity is three months. Compensating balance arrangements that do not legally restrict the withdrawal or usage of cash amounts may be reported as Cash and Cash Equivalents, while legally restricted deposits held as compensating balances against borrowing arrangements, contracts entered into with others, or company statements of intention with regard to particular deposits are not generally reported as cash and cash equivalents. Includes cash and cash equivalents associated with the entity's continuing operations. Excludes cash and cash equivalents associated with the disposal group (and discontinued operation). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The increase (decrease) during the reporting period in cash and cash equivalents. While for technical reasons this element has no balance attribute, the default assumption is a debit balance consistent with its label. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The aggregate expense recognized in the current period that allocates the cost of tangible assets, intangible assets, or depleting assets to periods that benefit from use of the assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The amount of cash paid during the current period to foreign, federal, state, and local authorities as taxes on income, net of any cash received during the current period as refunds for the overpayment of taxes. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The increase (decrease) during the reporting period in the amounts payable to vendors for goods and services received and the amount of obligations and expenses incurred but not paid. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The increase (decrease) during the reporting period in the amount due from borrowers for interest payments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The increase (decrease) during the reporting period in the account that represents the temporary difference that results from Income or Loss that is recognized for accounting purposes but not for tax purposes and vice versa. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The increase (decrease) during the reporting period in the aggregate value of all inventory held by the reporting entity, associated with underlying transactions that are classified as operating activities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The increase (decrease) during the reporting period in other assets used in operating activities not separately disclosed in the statement of cash flows. May include changes in other current assets, other noncurrent assets, or a combination of other current and noncurrent assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net cash inflow or outflow for the increase (decrease) associated with funds that are not available for withdrawal or use (such as funds held in escrow) and are associated with underlying transactions that are classified as operating activities. This may include cash restricted for regulatory purposes. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The amount of interest income and other income recognized during the period. Included in this element is interest derived from investments in debt securities, cash and cash equivalents, and other investments which reflect the time value of money or transactions in which the payments are for the use or forbearance of money and other income from ancillary business-related activities (that is, excluding major activities considered part of the normal operations of the business). No definition available.
|
| X | ||||||||||
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- Definition
The amount of cash paid for interest during the period net of cash paid for interest that is capitalized. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The fair value of restricted stock or stock options granted to nonemployees as payment for services rendered or acknowledged claims. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net cash inflow or outflow from financing activity for the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net cash inflow or outflow from investing activity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net cash from (used in) all of the entity's operating activities, including those of discontinued operations, of the reporting entity. Operating activities generally involve producing and delivering goods and providing services. Operating activity cash flows include transactions, adjustments, and changes in value that are not defined as investing or financing activities. While for technical reasons this element has no balance attribute, the default assumption is a debit balance consistent with its label. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net amount paid or received by the reporting entity associated with purchase (sale or collection) of loans receivable arising from the financing of goods and services. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash outflow to reacquire common stock during the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash outflow for loan and debt issuance costs. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash outflow to acquire debt and equity securities not classified as either held-to-maturity securities or trading securities which would be classified as available-for-sale securities and reported at fair value, with unrealized gains and losses excluded from earnings and reported in a separate component of shareholders' equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash outflow associated with the acquisition of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale; includes cash outflows to pay for construction of self-constructed assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash inflow from a debt initially having maturity due after one year or beyond the operating cycle, if longer. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash inflow from amounts received from issuance of long-term debt that is wholly or partially secured by collateral. Excludes proceeds from tax exempt secured debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash inflow from a contractual arrangement with the lender, including letter of credit, standby letter of credit and revolving credit arrangements, under which borrowings can be made up to a specific amount at any point in time with either short term or long term maturity that is collateralized (backed by pledge, mortgage or other lien in the entity's assets). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash inflow from a long-term borrowing made from related parties where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and so forth. Alternate caption: Proceeds from Advances from Affiliates. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net cash inflow or outflow from the proceeds and repayments made on the long-term borrowing from related party where one party can exercise control or significant influence over another party; including affiliates, owners or officers and their immediate families, pension trusts, and such forth. Alternate caption: Proceeds from (Payments for) Advances from Affiliates. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The net cash inflow or outflow associated with long-term debt that is wholly or partially secured by collateral. Excludes proceeds from and repayments of tax exempt secured debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash inflow associated with the amount received from holders exercising their stock options. This item inherently excludes any excess tax benefit, which the entity may have realized and reported separately. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The sum of the periodic provision charged to operations, based on an assessment of the uncollectibility of the loan and lease portfolio, the offset to which is either added to or deducted from the allowance account for the purpose of reducing loan receivable and leases to an amount that approximates their net realizable value (the amount expected to be collected). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash outflow associated with security instruments that either represent a creditor or an ownership relationship with the holder of the investment security with a maturity of beyond one year or normal operating cycle, if longer. Includes repayments of (a) debt, (b) capital lease obligations, (c) mandatory redeemable capital securities, and (d) any combination of (a), (b), or (c). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The cash outflow to repay long-term debt that is wholly or partially secured by collateral. Excludes repayments of tax exempt secured debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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| X | ||||||||||
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- Definition
The aggregate amount of noncash, equity-based employee remuneration. This may include the value of stock or unit options, amortization of restricted stock or units, and adjustment for officers' compensation. As noncash, this element is an add back when calculating net cash generated by operating activities using the indirect method. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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(1) Summary of Significant Accounting Policies
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Jun. 30, 2011
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| Significant Accounting Policies [Text Block] |
(1)
Summary of
Significant Accounting Policies
Description
of Business
We
were formed in California on March 8, 1991. We specialize in
purchasing and servicing retail automobile installment sale
contracts (“automobile contracts” or
“finance receivables”) originated by licensed
motor vehicle dealers located throughout the United States
(“dealers”) in the sale of new and used
automobiles, light trucks and passenger vans. Through our
purchases, we provide indirect financing to dealer customers
for borrowers with limited credit histories, low incomes or
past credit problems (“sub-prime customers”). We
serve as an alternative source of financing for dealers,
allowing sales to customers who otherwise might not be able
to obtain financing. In addition to purchasing installment
purchase contracts directly from dealers, we have also (i)
acquired installment purchase contracts in three merger and
acquisition transactions, (ii) purchased immaterial amounts
of vehicle purchase money loans from non-affiliated lenders,
and (iii) lent money directly to consumers for an immaterial
amount of vehicle purchase money loans. In this
report, we refer to all of such contracts and loans as
"automobile contracts."
Basis
of Presentation
Our
Unaudited Condensed Consolidated Financial Statements have
been prepared in conformity with accounting principles
generally accepted in the United States of America, with the
instructions to Form 10-Q and with Article 8 of Regulation
S-X of the Securities and Exchange Commission, and include
all adjustments that are, in our opinion, necessary for a
fair presentation of the results for the interim periods
presented. All such adjustments are, in the opinion of
management, of a normal recurring nature. In
addition, certain items in prior period financial statements
may have been reclassified for comparability to current
period presentation. Results for the six-month period ended
June 30, 2011 are not necessarily indicative of the operating
results to be expected for the full year.
Certain
information and footnote disclosures normally included in
financial statements prepared in accordance with accounting
principles generally accepted in the United States of America
have been condensed or omitted from these Unaudited Condensed
Consolidated Financial Statements. These Unaudited Condensed
Consolidated Financial Statements should be read in
conjunction with the Consolidated Financial Statements and
Notes to Consolidated Financial Statements included in our
Annual Report on Form 10-K for the year ended December 31,
2010.
Use
of Estimates
The
preparation of financial statements in conformity with
accounting principles generally accepted in the
United States of America requires us to make estimates
and assumptions that affect the reported amounts of assets
and liabilities as of the date of the financial statements,
as well as the reported amounts of income and expenses during
the reported periods. Specifically, a number of estimates
were made in connection with determining an appropriate
allowance for finance credit losses, valuing residual
interest in securitizations, accreting net acquisition fees,
amortizing deferred costs, valuing warrants issued, and the
recording of deferred tax assets and reserves for uncertain
tax positions. These are material estimates that could be
susceptible to changes in the near term and, accordingly,
actual results could differ from those estimates.
Other
Income
The
following table presents the primary components of Other
Income:
Stock-based
Compensation
We
recognize compensation costs in the financial statements for
all share-based payments granted subsequent to January 1,
2006 based on the grant date fair value estimated in
accordance with the provisions of ASC 718
“Accounting for Stock Based Compensation”.
For
the six months ended June 30, 2011 and 2010, we recorded
stock-based compensation costs in the amount of $824,000 and
$818,000, respectively. As of June 30, 2011,
unrecognized stock-based compensation costs to be recognized
over future periods equaled $2.4 million. This amount will be
recognized as expense over a weighted-average period of 2.9
years.
The
following represents stock option activity for the three
months ended June 30, 2011:
At
June 30, 2011, the aggregate intrinsic value of options
outstanding and exercisable was $599,000 and $253,000,
respectively. There were 3,000 shares exercised for the six
months ended June 30, 2011 compared to none for the
comparable period in 2010. There were 1.8 million
shares available for future stock option grants under
existing plans as of June 30, 2011.
Purchases
of Company Stock
During
the six-month periods ended June 30, 2011 and 2010, we
purchased 74,292 and 670,129 shares, respectively, of our
common stock, at average prices of $1.15 and $1.65,
respectively.
New
Accounting Pronouncements
In
April 2011, the FASB issued ASU 2011-02, Receivables
(Topic 310) – A Creditor’s Determination of
Whether a Restructuring is a Troubled Debt
Restructuring, which is an accounting standard updated
to amend previous guidance with respect to troubled debt
restructurings. This updated guidance is designed to
assist creditors with determining whether or not a
restructuring constitutes a troubled debt
restructuring. In particular, additional guidance has
been added to help creditors determine whether a concession
has been granted and whether a debtor is experiencing
financial difficulties. Both of these conditions are required
to be met for a restructuring to constitute a troubled debt
restructuring. The amendments in the update are
effective for us in the quarterly period ending June 30,
2011, and should be applied retrospectively to the beginning
of
the
annual period of adoption. The provisions of this
update are not expected to have a material impact on the
Company’s financial position, results or operations or
cash flows.
Reclassifications
Some
items in the prior year financial statements were
reclassified to conform to the current presentation.
Reclassifications had no effect on prior year net income or
total shareholders’ equity.
Uncertainty
of Capital Markets and General Economic Conditions
Historically,
we have depended upon the availability of warehouse credit
facilities and access to long-term financing through the
issuance of asset-backed securities collateralized by our
automobile contracts. Since 1994 and through June 30, 2011,
we had completed 51 term securitizations of approximately
$6.8 billion in contracts. We conducted four term
securitizations in 2006, four in 2007, two in 2008, one in
2010 and one in 2011. From July 2003 through April 2008 all
of our securitizations were structured as secured
financings. The second of our two securitization
transactions in 2008 (completed in September 2008) and our
securitization in September 2010 (a re-securitization of the
remaining receivables from the September 2008 transaction)
were each in substance a sale of the related contracts, and
have been treated as sales for financial accounting purposes.
On April 27, 2011 we completed our second rated
term securitization since April 2008. In this transaction, we
issued $100.4 million of notes collateralized by $104.5
million of contracts purchased primarily in 2010 and 2011. A
portion of the proceeds from the sale of these notes were
used to repay $77.9 million of the outstanding balance on our
warehouse credit facilities. No gain or loss was
recognized as a result of the securitization which was
structured as a secured financing.
Since
the fourth quarter of 2007 and through the end of 2009, we
observed unprecedented adverse changes in the market for
securitized pools of automobile contracts. These changes
included reduced liquidity, and reduced demand for
asset-backed securities, particularly for securities carrying
a financial guaranty and for securities backed by sub-prime
automobile receivables. Moreover, many of the firms that
previously provided financial guarantees, which were an
integral part of our securitizations, suspended offering such
guarantees. The adverse changes that took place in
the market from the fourth quarter of 2007 through the end of
2009 caused us to conserve liquidity by significantly
reducing our purchases of automobile contracts. However,
since October 2009, we have gradually increased our contract
purchases by utilizing one $50 million credit facility that
we established in September 2009 and another $50 million term
funding facility that we established in March
2010. In September 2010 we took advantage of
improvement in the market for asset-backed securities by
re-securitizing the remaining underlying receivables from our
unrated September 2008 securitization. By doing so
we were able to pay off the bonds associated with the
September 2008 transaction and issue rated bonds with a
significantly lower weighted average coupon. The
September 2010 transaction was our first rated term
securitization since 1993 that did not utilize a financial
guaranty. More recently, we increased our
short-term funding capacity by $200 million with the
establishment of a new $100 million credit facility in
December 2010 and an additional $100 million credit facility
in February 2011. In addition, as
stated above, on April 27, 2011 we completed a securitization
of $104.5 million of receivables purchased primarily in 2010
and 2011 and we expect to complete one or more additional
term securitization transactions in 2011. In spite
of the improvements we have seen in the capital markets, if
the trend of improvement in the markets for asset-backed
securities should reverse, or if we should be unable to
obtain additional contract financing facilities or to
complete a term securitization of our recently originated
receivables, we may curtail or cease our purchases of new
automobile contracts, which could lead to a material adverse
effect on our operations.
Rescission
Liability
From
May 2005 to July 2010, we conducted a continuous public
offering of subordinated notes, pursuant to a registration
statement that was declared effective by the SEC in May 2005.
In July 2010, we learned that, pursuant to a rule of the SEC,
we were no longer permitted to offer and sell our
subordinated notes in reliance
upon
that registration statement. Consequently, certain investors
who purchased or renewed such subordinated notes prior to the
effectiveness of the new registration statement for such
subordinated notes on December 13, 2010 may have a statutory
right to rescind their purchase or renewal for a period of up
to twelve months from the date of their purchase or renewal.
As a result, we may have rescission liability and
could be required to repurchase some or all of such
subordinated notes at the original sales price plus statutory
interest, less the amount of any income received by the
purchasers. As of June 30, 2011, there were approximately
$3.1 million of such subordinated notes (excluding any
subordinated notes subsequently repaid) purchased or renewed
after June 30, 2010, but before December 13, 2010, for which
we may have rescission liability.
Derivative
Financial Instruments
We do
not use derivative financial instruments to hedge exposures
to cash-flow or market risks. However, from 2008 to 2010, we
issued warrants to purchase the Company’s common stock
in conjunction with various debt financing transactions.
Certain of these warrants issued contain round down or reset
features that are subject to classification as liabilities
for financial statement purposes. These liabilities are
measured at fair value with the changes in fair value
at the end of each period reflected as current period income
or loss. Accordingly, changes to the price per share of our
common stock underlying these warrants with round down or
price reset features directly impact the fair value
computations for these derivative financial instruments.
Thus, any increase in the price per share of our common stock
also increases the related liability which would result in a
current period loss. Conversely, any decrease in the price
per share of our common stock also decreases the related
liability which would result in a current period gain. We
utilize a Binomial pricing model to compute the fair value of
the liabilities associated with the outstanding warrants. In
computing the fair value of the warrants liabilities at the
end of each period, we use significant judgments with respect
to the risk free interest rate, the volatility of our stock
prices, and estimated life of the warrants. The effects of
these judgments, if proven incorrect could have a significant
impact to our financial statements. The
warrant liabilities are included in Accounts payable and
accrued expenses on our consolidated balance
sheets.
Financial
Covenants
Certain
of our securitization transactions and our warehouse credit
facility contain various financial covenants requiring
certain minimum financial ratios and results. Such covenants
include maintaining minimum levels of liquidity and net worth
and not exceeding maximum leverage levels and maximum
financial losses. In addition, certain securitization and
non-securitization related debt contain cross-default
provisions that would allow certain creditors to declare a
default if a default occurred under a different
facility.
The
agreements under which we receive periodic fees for servicing
automobile contracts in securitizations are terminable by the
respective financial guaranty insurance companies (also
referred to as note insurers) upon defined events of default,
and, in some cases, at the will of the insurance
company. In August 2010, we agreed with the note
insurer for five of our 11 currently outstanding
securitizations to amend the applicable agreements to remove
the financial covenants that were contained in three of the
related agreements. In return for such amendments,
we agreed to increase the required credit enhancement amounts
in those three deals through increased spread account
requirements. The remaining two transactions
insured by this particular note insurer do not contain
financial covenants.
For
the remaining four securitizations insured by different
parties we have been receiving waivers for certain financial
and operating covenants on a monthly and/or quarterly basis
as summarized below:
The
adjusted net worth covenants are covenants to maintain
minimum levels of adjusted net worth, defined as our
consolidated book value under GAAP with the exclusion of
intangible assets such as goodwill. There are two separate
adjusted net worth covenants because there are two separate
note insurers that have this covenant in their related
securitization agreements. The leverage covenant requires
that we not exceed the specified ratio of debt over the
defined adjusted net worth. Debt is defined in this
covenant to mean consolidated liabilities less warehouse
lines of credit and securitization trust debt; using this
definition at June 30, 2011, we had debt of $127.9
million.
Without
the waivers we have received from the related note insurers,
we would have been in violation of covenants relating to
minimum net worth and maximum leverage levels with respect to
four of our 11 currently outstanding securitization
transactions. Upon such an event of default, and
subject to the right of the related note insurers to waive
such terms, the agreements governing the securitizations call
for payment of a default insurance premium, ranging from 25
to 100 basis points per annum on the aggregate outstanding
balance of the related insured senior notes, and for the
diversion of all excess cash generated by the assets of the
respective securitization pools into the related spread
accounts to increase the credit enhancement associated with
those transactions. The cash so diverted into the spread
accounts would otherwise be used to make principal payments
on the subordinated notes in each related securitization or
would be released to us. To the extent that principal
payments on the subordinated notes are delayed, we will incur
greater interest expense on the subordinated notes than we
would have without the required increase to the related
spread accounts. As of the date of this report,
cash is being diverted to the related spread accounts in four
transactions. In addition, upon an event of
default, the note insurers have the right to terminate us as
servicer. Although our termination as servicer has
been waived, we are paying default premiums, or their
equivalent, with respect to insured notes representing $236.3
million of the $516.3 million of securitization trust debt
outstanding at June 30, 2011. It should be noted that the
principal amount of such securitization trust debt is not
increased, but that the increased insurance premium is
reflected as increased interest
expense. Furthermore, such waivers are temporary,
and there can be no assurance as to their future extension.
We do, however, believe that we will obtain such future
extensions of our servicing agreements because it is
generally not in the interest of any party to the
securitization transaction to transfer
servicing. Nevertheless, there can be no assurance
as to our belief being correct. Were an insurance
company in the future to exercise its option to terminate
such agreements or to pursue other remedies, such remedies
could have a material adverse effect on our liquidity and
results of operations, depending on the number and value of
the affected transactions. Our note insurers continue to
extend our term as servicer on a monthly and/or quarterly
basis, pursuant to the servicing agreements.
Correction of
Immaterial Error
In
the first quarter of 2011, we revised our consolidated
financial statements for the years ended December 31, 2009
and 2010, including the quarters therein, due to corrections
of immaterial prior years’ errors identified in the
current year. We understated derivative liabilities and
mis-stated interest expense for 2009 and 2010 primarily
related to the accounting treatment of derivative liabilities
associated with certain warrants we issued in conjunction
with various debt financing transactions. The
result of the correction included a decrease of previously
reported net loss by $649,000 for the year ended December 31,
2010, a decrease in the previously reported net loss by
$82,000 for the six months ended June 30, 2010 and a decrease
of previously reported net loss of $2.2 million for the three
months ended June 30, 2010. Basic and diluted loss per common
share decreased by $0.04 per share from previously reported
amounts as of the December 31, 2010 and decreased by $0.12
and $0.01 per share for the three and six months ended June
30, 2010, respectively. Net shareholders’
equity decreased by $2.7 million and $2.1 million,
respectively compared to the amounts previously reported as
of June 30, 2010 and December 31, 2010.
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- Definition
The entire disclosure for all significant accounting policies of the reporting entity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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|
(2) Finance Receivables
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| Financing Receivables [Text Block] |
(2) Finance
Receivables
Our
portfolio of finance receivables consists of small-balance
homogeneous contracts comprising a single segment and class
that is collectively evaluated for impairment on a portfolio
basis according to delinquency status. We report delinquency
on a contractual basis. Once a Contract becomes greater than
90 days delinquent, we do not recognize additional interest
income until the obligor under the Contract makes sufficient
payments to be less than 90 days delinquent. Any
payments received on a Contract that is greater than 90 days
delinquent are first applied to accrued interest and then to
principal reduction.
The
following table presents the components of Finance
Receivables, net of unearned interest:
We
consider an automobile contract delinquent when an obligor
fails to make at least 90% of a contractually due payment by
the following due date, which date may have been extended
within limits specified in the servicing agreements. The
period of delinquency is based on the number of days payments
are contractually past due. Automobile contracts less than 31
days delinquent are not included. The following
table summarizes the delinquency status of finance
receivables as of June 30, 2011 and December 31, 2010:
Finance
receivables totaling $5.1 million and $13.3 million at June
30, 2011 and December 31, 2010, respectively, including all
receivables greater than 90 days delinquent have been placed
on non-accrual status as a result of their delinquency
status.
The
following table presents a summary of the activity for the
allowance for credit losses for the three month and six-month
periods ended June 30, 2011 and 2010:
Excluded
from finance receivables are contracts that were previously
classified as finance receivables but were reclassified as
other assets because we have repossessed the vehicle securing
the Contract. The following table presents a
summary of such repossessed inventory together with the
allowance for losses in repossessed inventory that is not
included in the allowance for credit losses:
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- Definition
The entire disclosure for financing receivables. Examples of financing receivables include, but are not limited to, loans, trade accounts receivables, notes receivable, credit cards, and receivables relating to a lessor's right(s) to payment(s) from a lease other than an operating lease that is recognized as assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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(3) Securitization Trust Debt
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| Subordinated Borrowings Disclosure [Text Block] |
(3)
Securitization
Trust Debt
We
have completed a number of securitization transactions that
are structured as secured borrowings for financial accounting
purposes. The debt issued in these transactions is shown on
our Unaudited Condensed Consolidated Balance Sheets as
“Securitization trust debt,” and the components
of such debt are summarized in the following table:
_________________
All
of the securitization trust debt was sold in private
placement transactions to qualified institutional buyers. The
debt was issued through our wholly-owned bankruptcy remote
subsidiaries and is secured by the assets of such
subsidiaries, but not by our other assets. Principal of
$264.4 million, and the related interest payments, are
guaranteed by financial guaranty insurance policies issued by
third party financial institutions.
The
terms of the various securitization agreements related to the
issuance of the securitization trust debt and the warehouse
credit facilities require that we meet certain delinquency
and credit loss criteria with respect to
the
collateral pool, and require that we maintain minimum levels
of liquidity and net worth and not exceed maximum leverage
levels and maximum financial losses. In addition,
certain securitization and non-securitization related debt
contain cross-default provisions, which would allow certain
creditors to declare a default if a default were declared
under a different facility. We have received
waivers regarding the potential breach of certain such
covenants relating to minimum net worth
and maximum leverage levels.
We
are responsible for the administration and collection of the
automobile contracts. The securitization agreements also
require certain funds be held in restricted cash accounts to
provide additional collateral for the borrowings or to be
applied to make payments on the securitization trust debt. As
of June 30, 2011, restricted cash under the various
agreements totaled approximately $128.4 million. Interest
expense on the securitization trust debt consists of the
stated rate of interest plus amortization of additional costs
of borrowing. Additional costs of borrowing include facility
fees, insurance and amortization of deferred financing costs
and discounts on notes sold. Deferred financing costs and
discounts on notes sold related to the securitization trust
debt are amortized using a level yield method. Accordingly,
the effective cost of the securitization trust debt is
greater than the contractual rate of interest disclosed
above.
Our
wholly-owned bankruptcy remote subsidiaries were formed to
facilitate the above asset-backed financing transactions.
Similar bankruptcy remote subsidiaries issue the debt
outstanding under our warehouse line of credit. Bankruptcy
remote refers to a legal structure in which it is expected
that the applicable entity would not be included in any
bankruptcy filing by its parent or affiliates. All of the
assets of these subsidiaries have been pledged as collateral
for the related debt. All such transactions, treated as
secured financings for accounting and tax purposes, are
treated as sales for all other purposes, including legal and
bankruptcy purposes. None of the assets of these subsidiaries
are available to pay other creditors of ours.
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- Definition
The entire disclosure for borrowings under subordinated debt agreements that qualify as available in computing net capital under SEC's uniform net capital rule, including restrictive covenants, collateral, interest rates and due dates, amounts due by date and amount owed in total. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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(4) Interest Income
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| Interest and Other Income [Text Block] |
(4)
Interest
Income
The
following table presents the components of interest
income:
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- Definition
The entire disclosure for interest and other income. No definition available.
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(5) Earnings (Loss) Per Share
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| Earnings Per Share [Text Block] |
(5)
Earnings
(Loss) Per Share
Earnings
(loss) per share for the three-month and six-month periods
ended June 30, 2011 and 2010 were calculated using the
weighted average number of shares outstanding for the related
period. The following table reconciles the number of shares
used in the computations of basic and diluted earnings (loss)
per share for the three-month and six-month periods ended
June 30, 2011 and 2010:
If
the anti-dilutive effects of common stock equivalents were
considered, shares included in the diluted earnings (loss)
per share calculation for the three-month and six-month
periods ended June 30, 2011 would have included an additional
2.9 million and 3.0 million shares, respectively,
attributable to the exercise of outstanding options and
warrants. For the three-month and six-month periods ended
June 30, 2010, there were 3.6 million and 3.5 million shares,
respectively, attributable to the exercise of outstanding
options and warrants.
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- Definition
The entire disclosure for earnings per share. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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(6) Income Taxes
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| Income Tax Disclosure [Text Block] |
(6)
Income
Taxes
We
file numerous consolidated and separate income tax returns
with the United States and with many states. With few
exceptions, we are no longer subject to United States federal
income tax examinations for years before 2006 and are no
longer subject to state and local income tax examinations by
tax authorities for years before 2003.
We
have subsidiaries in various states that are currently under
audit for years ranging from 2003 through 2006. To date, no
material adjustments have been proposed as a result of these
audits.
We
do not anticipate that total unrecognized tax benefits will
significantly change due to any settlements of audits or
expirations of statutes of limitations over the next twelve
months.
The
Company and its subsidiaries file a consolidated federal
income tax return and combined or stand-alone state franchise
tax returns for certain states. We utilize the asset and
liability method of accounting for income taxes, under which
deferred income taxes are recognized for the future tax
consequences attributable to the differences between the
financial statement values of existing assets and liabilities
and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The
effect on deferred taxes of a change in tax rates is
recognized in income in the period that includes the
enactment date. We have estimated a valuation allowance
against that portion of the deferred tax asset whose
utilization in future periods is not more than likely. Our net
deferred tax asset of $15.0 million as of June 30, 2011 is
net of a valuation allowance of $60.1 million.
On
a quarterly basis, we determine whether a valuation allowance
is necessary for our deferred tax asset. In performing this
analysis, we consider all evidence currently available, both
positive and negative, in determining whether, based on the
weight of that evidence, the deferred tax asset will be
realized. We establish a valuation allowance when it is more
likely than not that a recorded tax benefit will not be
realized. The
expense
to create the valuation allowance is recorded as additional
income tax expense in the period the valuation allowance is
established. During the first six months of 2011, we
increased our valuation allowance by $3.5 million.
In
determining the possible future realization of deferred tax
assets, we have considered the taxes paid in the current and
prior years that may be available to recapture, as well as
future taxable income from the following sources: (a)
reversal of taxable temporary differences; and (b) tax
planning strategies that, if necessary, would be implemented
to accelerate taxable income into years in which net
operating losses might otherwise expire. Our tax planning
strategies include the prospective sale of certain assets
such as finance receivables, residual interests in
securitized finance receivables, charged off receivables and
base servicing rights. The expected proceeds for
such asset sales have been estimated based on our expectation
of what buyers of the assets would consider to be reasonable
assumptions for net cash flows and required rates of return
for each of the various asset types. Our estimates
for net cash flows and required rates of return are
subjective and inherently subject to future events which may
significantly impact actual net proceeds we may receive from
executing our tax planning strategies.
We
believe such asset sales can produce at least $37.5 million
in taxable income within the relevant carryforward period.
Such strategies could be implemented without significant
impact on our core business or our ability to generate future
growth. The costs related to the implementation of these tax
strategies were considered in evaluating the amount of
taxable income that could be generated in order to realize
our deferred tax assets.
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- Definition
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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(7) Legal Proceedings
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| Legal Matters and Contingencies [Text Block] |
(7)
Legal
Proceedings
Stanwich
Litigation. We were for some time a defendant in a
class action (the “Stanwich Case”) brought in the
California Superior Court, Los Angeles County. The original
plaintiffs in that case were persons entitled to receive
regular payments (the “Settlement Payments”)
under out-of-court settlements reached with third party
defendants. Stanwich Financial Services Corp.
(“Stanwich”), then an affiliate of our former
chairman of the board of directors, is the entity that was
obligated to pay the Settlement Payments. Stanwich had
defaulted on its payment obligations to the plaintiffs and in
September 2001 filed for reorganization under the Bankruptcy
Code, in the federal Bankruptcy Court of
Connecticut. By February 2005, we had settled all
claims brought against us in the Stanwich Case.
In
November 2001, one of the defendants in the Stanwich Case,
Jonathan Pardee, asserted claims for indemnity against us in
a separate action, which is now pending in federal district
court in Rhode Island. We have filed counterclaims in the
Rhode Island federal court against Mr. Pardee, and have filed
a separate action against Mr. Pardee's Rhode Island
attorneys, in the same court. Each of these actions in the
court in Rhode Island is stayed, awaiting resolution of an
adversary action brought against Mr. Pardee in the bankruptcy
court, which is hearing the bankruptcy of Stanwich.
The
reader should consider that any adverse judgment against us
in this case for indemnification, in an amount materially in
excess of any liability already recorded in respect thereof,
could have a material adverse effect on our financial
position. There can be no assurance as to the
ultimate outcome of this matter.
On
April 6, 2011, that adversary action was dismissed, pursuant
to an agreement between us and the representative of
creditors in the Stanwich bankruptcy. Under that
agreement, CPS has paid the bankruptcy estate $800,000 and
abandoned its claims against the estate, and the estate has
abandoned its adversary action against Mr. Pardee. We
believe that this resolution of the adversary action will
result in (i) limitation of our exposure to Mr. Pardee
to no more than some portion of his attorneys fees incurred
and (ii) stays in Rhode Island being lifted, causing those
cases to become active again. The entire payment
in this matter was included in our legal contingency
liability as of December 31, 2010.
Other
Litigation.
We
are routinely involved in various legal proceedings resulting
from our consumer finance activities and practices, both
continuing and discontinued. We believe that there are
substantive legal defenses to such claims, and intend to
defend them vigorously. There can be no assurance, however,
as to the outcome.
We
have recorded a liability as of June 30, 2011 that we believe
represents a sufficient allowance for legal contingencies,
including those described above. Any adverse judgment against
us, if in an amount materially in excess of the recorded
liability, could have a material adverse effect on our
financial position.
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- Definition
The entire disclosure for legal proceedings, legal contingencies, litigation, regulatory and environmental matters and other contingencies. No definition available.
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(8) Employee Benefits
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| Compensation and Employee Benefit Plans [Text Block] |
(8)
Employee
Benefits
On
March 8, 2002 we acquired MFN Financial Corporation and its
subsidiaries in a merger. We sponsor the MFN
Financial Corporation Benefit Plan (the “Plan”).
Plan benefits were frozen June 30, 2001. The table below sets
forth the Plan’s net periodic benefit cost for the
three-month and six-month periods ended June 30, 2011 and
2010.
We
contributed $249,000 to the Plan during the six-month period
ended June 30, 2011 and we anticipate making contributions in
the amount of $273,000 for the remainder of 2011.
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- Definition
The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. No definition available.
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(9) Fair Value Measurements
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Jun. 30, 2011
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| Fair Value Disclosures [Text Block] |
(9)
Fair Value Measurements
In
September 2006, the FASB issued ASC 820, "Fair Value
Measurements" which clarifies the principle that
fair value should be based on the assumptions market
participants would use when pricing an asset or liability and
establishes a fair value hierarchy that prioritizes the
information used to develop those assumptions. Under the
standard, fair value measurements would be separately
disclosed by level within the fair value hierarchy.
ASC
820 defines fair value, establishes a framework for measuring
fair value, establishes a three-level valuation hierarchy for
disclosure of fair value measurement and enhances disclosure
requirements for fair value measurements. The three levels
are defined as follows: level 1 - inputs to the valuation
methodology are quoted prices (unadjusted) for identical
assets or liabilities in active markets; level 2 –
inputs to the valuation methodology include quoted prices for
similar assets and liabilities in active markets, and inputs
that are observable for the asset or liability, either
directly or indirectly, for substantially the full term of
the financial instrument; and level 3 – inputs to the
valuation methodology are unobservable and significant to the
fair value measurement.
Certain
warrants issued between 2008 and 2010 in conjunction with
various debt financing transactions contain features that
make them subject to derivative accounting. We valued these
warrants using a Binomial valuation model using a weighted
average volatility assumption of 41%, weighted average term
of 8 years and a risk free rate of 3.3%. We estimated the
value of these warrants to be $1.6 million which is
classified as a liability in the Company’s Balance
Sheet as of June 30, 2011.
In
September 2008 we sold automobile contracts in a
securitization that was structured as a sale for financial
accounting purposes. In that sale, we retained
both securities and a residual interest in the transaction
that are measured at fair value. We describe below
the valuation methodologies we use for the securities
retained and the residual interest in the cash flows of the
transaction, as well as the general classification of such
instruments pursuant to the valuation
hierarchy. The securities retained were sold in
September 2010 in the re-securitization transaction described
in Note 1. In the same transaction, the residual interest was
reduced by $1.5 million. The residual interest in
such securitization is $4.0 million as of June 30, 2011 and
is classified as level 3 in the three-level valuation
hierarchy. We determine the value of that residual interest
using a discounted cash flow model that includes estimates
for prepayments and losses. We use a discount rate
of 20% per annum and a cumulative net loss rate of 13%. The
assumptions we use are based on historical performance of
automobile contracts we have originated and serviced in the
past, adjusted for current market conditions. No gain or loss
was recorded as a result of the re-securitization transaction
described above.
Repossessed
vehicle inventory, which is included in Other Assets on our
balance sheet, is measured at fair value using Level 2
assumptions based on our actual loss experience on sale of
repossessed vehicles. At June 30, 2011, the finance
receivables related to the repossessed vehicles in inventory
totaled $10.2 million. We have applied a valuation adjustment
of $6.1 million, resulting in an estimated fair value and
carrying amount of $4.1 million.
We
have no Level 3 assets that are measured at fair value on a
nonrecurring basis. The table below presents a
reconciliation for Level 3 assets measured at fair value on a
recurring basis using significant unobservable inputs:
The
following summary presents a description of the methodologies
and assumptions used to estimate the fair value of our
financial instruments. Much of the information used to
determine fair value is highly subjective. When applicable,
readily available market information has been utilized.
However, for a significant portion of our financial
instruments, active markets do not exist. Therefore,
significant elements of judgment were required in estimating
fair value for certain items. The subjective factors include,
among other things, the estimated timing and amount of cash
flows, risk characteristics, credit quality and interest
rates, all of which are subject to change. Since the fair
value is estimated as of June 30, 2011 and December 31, 2010,
the amounts that will actually be realized or paid at
settlement or maturity of the instruments could be
significantly different. The estimated fair values of
financial assets and liabilities at June 30, 2011 and
December 31, 2010, were as follows:
Cash,
Cash Equivalents and Restricted Cash
The
carrying value equals fair value.
Finance
Receivables, net
The
fair value of finance receivables is estimated by discounting
future cash flows expected to be collected using current
rates at which similar receivables could be
originated.
Residual
Interest in Securitizations
The
fair value is estimated by discounting future cash flows
using credit and discount rates that we believe reflect the
estimated credit, interest rate and prepayment risks
associated with similar types of instruments.
Warrant
Derivative Liability
The
fair value is estimated using a binomial valuation model with
assumptions for volatility, expected term and risk free
interest rates as described above.
Accrued
Interest Receivable and Payable
The
carrying value approximates fair value because the related
interest rates are estimated to reflect current market
conditions for similar types of instruments.
Warehouse
Lines of Credit, Residual Interest Financing, and Senior
Secured Debt and Subordinated Renewable Notes
The
carrying value approximates fair value because the related
interest rates are estimated to reflect current market
conditions for similar types of secured instruments.
Securitization
Trust Debt
The
fair value is estimated by discounting future cash flows
using interest rates that we believe reflects the current
market rates.
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- Definition
The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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