Kohl's 2008 Annual Report Download - page 49

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KOHL’S CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
1. Business and Summary of Accounting Policies (continued)
factors, severity factors and other actuarial assumptions, to estimate the liabilities associated with these risks. We
retain the initial risk of $500,000 per occurrence under our workers’ compensation insurance policy and
$250,000 per occurrence under our general liability policy. We also have a lifetime medical payment limit of
$1.5 million. Total estimated liabilities for workers’ compensation, general liability and employee-related health
benefits, excluding administrative expenses and before pre-funding, were approximately $81 million at
January 31, 2009 and $70 million at February 2, 2008. Although these amounts are actuarially determined based
on analysis of historical trends, the amounts that we will ultimately disburse could differ from these estimates.
Long-term Liabilities
The major components of other long-term liabilities consist of the following:
Jan. 31,
2009
Feb. 2,
2008
(In Millions)
Property related liabilities ...................................... $250 $221
Unrecognized tax benefits, including accrued interest and penalties ..... 115 98
Other long-term liabilities ...................................... 42 54
$407 $373
Treasury Stock
We account for repurchases of common stock using the cost method with common stock in treasury
classified in the Consolidated Balance Sheets as a reduction of shareholders’ equity.
Revenue Recognition
Revenue from the sale of merchandise at our stores is recognized at the time of sale, net of any returns.
E-commerce sales are recorded upon the shipment of merchandise. Net sales do not include sales tax as we are
considered a pass-through conduit for collecting and remitting sales taxes. Revenue from gift card sales is
recognized when the gift card is redeemed.
Gift card breakage revenue is based on historical redemption patterns and represents the balance of gift
cards for which we believe the likelihood of redemption by a customer is remote.
F-10