Dell 2010 Annual Report Download - page 94

Table of Contents
DELL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Severance and facility action charges are included in cost of net revenue, selling, general and administrative expenses, and research,
development, and engineering in the Consolidated Statement of Income as follows:
Fiscal Year Ended
January 28, January 29, January 30,
2011 2010 2009
(in millions)
Severance and facility action costs:
Cost of net revenue $ 53 $ 236 $ 146
Selling, general, and administrative 68 238 136
Research, development, and engineering 8 7 -
Total $ 129 $ 481 $ 282
NOTE 11 — COMMITMENTS AND CONTINGENCIES
Lease Commitments — Dell leases property and equipment, manufacturing facilities, and office space under non-cancelable leases.
Certain of these leases obligate Dell to pay taxes, maintenance, and repair costs. At January 28, 2011, future minimum lease payments
under these non-cancelable leases are as follows: $106 million in Fiscal 2012; $71 million in Fiscal 2013; $53 million in Fiscal 2014;
$44 million in Fiscal 2015; $33 million in Fiscal 2016; and $68 million thereafter.
Rent expense under all leases totaled $87 million, $93 million, and $116 million for Fiscal 2011, Fiscal 2010, and Fiscal 2009,
respectively.
Purchase Obligations — Dell has contractual obligations to purchase goods or services, which specify significant terms, including fixed
or minimum quantities to be purchased; fixed, minimum, or variable price provisions; and the approximate timing of the transaction. As
of January 28, 2011, Dell has $293 million, $43 million, and $29 million in purchase obligations for Fiscal 2012, Fiscal 2013, and Fiscal
2014 and thereafter, respectively.
Restricted Cash — As of January 28, 2011, and January 29, 2010, Dell had restricted cash in the amounts of $25 million and
$147 million, respectively, included in other current assets on the Consolidated Statements of Financial Position. The balance at
January 29, 2010, was primarily related to an agreement between DFS and CIT, which required Dell to maintain an escrow cash account
that was held as recourse reserves for credit losses, performance fee deposits related to Dell's private label credit card, as well as amounts
maintained in escrow accounts related to Dell's acquisitions. In the third quarter of Fiscal 2011, the agreement between DFS and CIT was
terminated and the restricted cash that was held on deposit was returned to CIT. The balance at January 28, 2011, primarily relates to
various escrow accounts in connection with Dell's acquisitions.
Legal Matters — Dell is involved in various claims, suits, assessments, investigations, and legal proceedings that arise from time-to-time
in the ordinary course of its business, including those identified below, consisting of matters involving consumer, antitrust, tax,
intellectual property, and other issues on a global basis.
The following is a discussion of Dell's significant on-going legal matters and other proceedings:
SEC Investigation and Related Settlements — In August 2005, the SEC initiated an inquiry into certain of Dell's accounting and
financial reporting matters and requested that Dell provide certain documents. The SEC expanded that inquiry in June 2006 and
entered a formal order of investigation in October 2006. In August 2006, because of potential issues identified in the course of
responding to the SEC's requests for information, Dell's Audit Committee, on the recommendation of management and in
consultation with PricewaterhouseCoopers LLP, Dell's independent registered public accounting firm, initiated an independent
investigation into certain accounting and financial reporting matters, which was completed in the third quarter
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