Target 2007 Annual Report Download - page 38

New Accounting Pronouncements
2007 Adoptions
In September 2006, the Financial Accounting Standards Board (FASB) issued SFAS No. 158. SFAS 158
requires sponsors of defined benefit pension and other postretirement benefit plans (collectively
postretirement benefit plans) to recognize the funded status of their postretirement benefit plans in the
statement of financial position, measure the fair value of plan assets and benefit obligations as of the date of
the fiscal year-end statement of financial position and provide additional disclosures. We adopted the
recognition and disclosure provisions of SFAS 158 during 2006. We adopted the SFAS 158 measurement date
provision at the beginning of the first quarter of 2007, and the details of our adoption of this provision are
described in Note 27.
In July 2006, the FASB issued FASB Interpretation No. 48, ‘‘Accounting for Uncertainty in Income Taxes –
an interpretation of FASB Statement No. 109’’ (FIN 48). FIN 48 prescribes the financial statement recognition
and measurement criteria for tax positions taken in a tax return, clarifies when tax benefits should be recorded
and how they should be classified in financial statements and requires certain disclosures of uncertain tax
matters. We adopted the provisions of FIN 48 at the beginning of the first quarter of 2007, and the details of our
adoption of FIN 48 are described in Note 22.
At the beginning of the first quarter of 2007, we adopted the FASB’s Emerging Issues Task Force Issue
No. 06-5, ‘‘Accounting for Purchases of Life Insurance – Determining the Amount That Could Be Realized in
Accordance with FASB Technical Bulletin No. 85-4, Accounting for Purchases of Life Insurance’’ and recorded
a $4 million increase to other noncurrent assets, with a corresponding increase to retained earnings of
$4 million.
2008 and Future Adoptions
In September 2006, the FASB issued SFAS No. 157, ‘‘Fair Value Measurement’’ (SFAS 157). SFAS 157
defines fair value, provides guidance for measuring fair value in U.S. generally accepted accounting principles
and expands disclosures about fair value measurements. SFAS 157 will be effective at the beginning of fiscal
2008 for financial assets and liabilities and at the beginning of fiscal 2009 for nonfinancial assets and liabilities.
The adoption of this statement will not have a material impact on our consolidated net earnings, cash flows or
financial position.
In February 2007, the FASB issued SFAS No. 159, ‘‘The Fair Value Option for Financial Assets and
Financial Liabilities’’ (SFAS 159). SFAS 159 permits entities to choose to measure many financial instruments
and certain other items at fair value. SFAS 159 will be effective at the beginning of fiscal 2008. The adoption of
this statement will not have a material impact on our consolidated net earnings, cash flows or financial
position.
In December 2007, the FASB issued SFAS No. 141(R), ‘‘Business Combinations’’ (SFAS 141(R)), which
changes the accounting for business combinations and their effects on the financial statements. SFAS 141(R)
will be effective at the beginning of fiscal 2009. The adoption of this statement is not expected to have a
material impact on our consolidated net earnings, cash flows or financial position.
In December 2007, the FASB issued SFAS No. 160, ‘‘Accounting and Reporting of Noncontrolling
Interests in Consolidated Financial Statements, an amendment of ARB No. 51’’ (SFAS 160). SFAS 160
requires entities to report non-controlling interests in subsidiaries as equity in their consolidated financial
statements. SFAS 160 will be effective at the beginning of fiscal 2009. The adoption of this statement is not
expected to have a material impact on our consolidated net earnings, cash flows or financial position.
Forward-Looking Statements
This report, including the preceding Management’s Discussion and Analysis, contains forward-looking
statements regarding our performance, financial position, liquidity and adequacy of capital resources.
Forward-looking statements are typically accompanied by the words ‘‘expect,’’ ‘‘may,’’ ‘‘could,’’ ‘‘believe,’’
‘‘would,’’ ‘‘might,’’ ‘‘anticipates,’’ or words of similar import. The forward-looking statements in this report
include the anticipated impact of new and proposed accounting pronouncements, the expected outcome of
pending and threatened litigation, our expectations with respect to our share repurchase program and our
outlook in fiscal 2008. Forward-looking statements are based on our current assumptions and expectations
and are subject to certain risks and uncertainties that could cause actual results to differ materially from those
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