Best Buy 2008 Annual Report Download - page 73

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Notes to Consolidated Financial Statements
$ in millions, except per share amounts or as otherwise noted
fiscal 2008, the International segment operated 131 Future
1. Summary of Significant Accounting Policies
Shop stores and 51 Best Buy stores in Canada, and 160 Five
Description of Business Star stores and one Best Buy store in China.
Unless the context otherwise requires, the use of the terms In support of our retail store operations, we also maintain Web
‘‘Best Buy,’’ ‘‘we,’’ ‘‘us’’ and ‘‘our’’ in these notes to sites for each of our brands (BestBuy.com, BestBuy.ca,
consolidated financial statements refers to Best Buy Co., Inc. BestBuy.com.cn, BestBuyMobile.com, Five-Star.cn,
and its consolidated subsidiaries. Best Buy is a specialty retailer FutureShop.ca, GeekSquad.com, GeekSquad.ca,
of consumer electronics, home office products, entertainment MagnoliaAV.com, PacificSales.com, and Speakeasy.net).
software, appliances and related services, with fiscal 2008
revenue of $40.0 billion. Basis of Presentation
We operate two reportable segments: Domestic and The consolidated financial statements include the accounts of
International. The Domestic segment is comprised of all states, Best Buy Co., Inc. and its consolidated subsidiaries.
districts and territories of the U.S. and includes store, call Investments in unconsolidated entities over which we exercise
center and online operations of Best Buy, Best Buy Mobile, significant influence but do not have control are accounted for
Geek Squad, Magnolia Audio Video, Pacific Sales Kitchen and using the equity method. Our share of the net earnings or loss
Bath Centers (‘‘Pacific Sales’’) and Speakeasy (‘‘Speakeasy’’). was not significant for any period presented. We have
We acquired Speakeasy on May 1, 2007, and include their eliminated all intercompany accounts and transactions.
financial results in the Domestic segment. U.S. Best Buy stores
Consistent with China’s statutory requirements, our China
offer a wide variety of consumer electronics, home office
operations’ fiscal year ends on December 31. Therefore, we
products, entertainment software, appliances and related
have elected to consolidate our China financial results on a
services. Best Buy Mobile offers a wide selection of mobile
two-month lag. There were no significant intervening events
phones, accessories and services through select U.S. Best Buy
which would have materially affected our consolidated
stores as well as through stand-alone stores. Geek Squad
financial statements had they been recorded during the fiscal
provides residential and commercial computer repair, support
year.
and installation services through all U.S. Best Buy stores and
through stand-alone stores. Magnolia Audio Video stores offer
Reclassifications
high-end audio and video products and related services.
Pacific Sales stores offer high-end home-improvement products To maintain consistency and comparability, certain amounts
including appliances, consumer electronics and related from previously reported consolidated financial statements have
services. Speakeasy provides broadband, voice, data and been reclassified to conform to the current-year presentation.
information technology services to home and small business We reclassified:
users through a network of experienced sales associates. At the
• to the International segment, $11 of selling, general
end of fiscal 2008, the Domestic segment operated 923 U.S.
and administrative expense (‘‘SG&A’’) support costs in
Best Buy stores, 19 Pacific Sales stores, 13 Magnolia Audio
fiscal 2007, which were previously reported as part of
Video stores, nine Best Buy Mobile stand-alone stores and
the Domestic segment in Note 9, Segment and
seven Geek Squad stand-alone stores.
Geographic Information;
The International segment is comprised of all Canada store,
• to equity and other investments, $20 of investments at
call center and online operations, including Best Buy, Future
March 3, 2007, which were previously reported in
Shop and Geek Squad; all China store, call center and online
other assets on our consolidated balance sheet;
operations, including Best Buy, Geek Squad and Jiangsu Five
Star Appliance Co. (‘‘Five Star’’). The International segment • to other, net, $32 and $4 for the years ended
offers products and services similar to those offered by our March 3, 2007 and February 25, 2006, respectively,
Domestic segment. However, Canada Best Buy stores do not which were previously reported in asset impairment
carry appliances. Further, our China Best Buy store and Five charges within cash provided by operating activities on
Star stores do not carry entertainment software. At the end of our consolidated statements of cash flows; and
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