Walgreens 2004 Annual Report Download - page 30

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30
Consolidated Balance Sheet
As of August 31, 2004
As Reported Adjustment As Restated
Deferred Income Taxes $ 327.6
$ (53.5)
$ 274.1
Other Non-Current Liabilities 708.6
141.8
850.4
Total Non-Current Liabilities 1,036.2
88.3
1,124.5
Retained Earnings 7,591.6
(88.3)
7,503.3
Total Shareholders' Equity 8,228.0
(88.3)
8,139.7
Consolidated Balance Sheet
As of August 31, 2003
As Reported Adjustment As Restated
Deferred Income Taxes $ 228.0
$ (47.3)
$ 180.7
Other Non-Current Liabilities 561.7
125.2
686.9
Total Non-Current Liabilities 789.7
77.9
867.6
Retained Earnings 6,417.8
(77.9)
6,339.9
Total Shareholders' Equity 7,195.7
(77.9)
7,117.8
In addition to the effects shown above, retained earnings as of August 31, 2001 were adjusted by $56.2 million from $4,530.9
million, as previously reported, to $4,474.7 million, as restated.
Additionally, auction rate securities of $1,251.5 million which were previously classified as cash and cash equivalents at August
31, 2004 have been reclassified as short term investments available for sale. The cash flows related to these investments are now
disclosed as investing activities in the company's Consolidated Statements of Cash Flows.
Leases
Although 17.1% of locations are owned, the remainder are leased premises. Initial terms are typically 20 to 25 years, followed by
additional terms containing cancellation options at five-year intervals, and may include rent escalation clauses. The company has
revised its accounting such that the commencement date of all lease terms is the earlier of the date the company becomes legally
obligated to make rent payments or the date the company has the right to control the property. Additionally, the company
recognizes rent expense on a straight-line basis over a time period that equals or exceeds the time period used for depreciation of
buildings on leased land. In addition to minimum fixed rentals, most leases provide for contingent rentals based upon sales.
Minimum rental commitments at August 31, 2004, under all leases having an initial or remaining non-cancelable term of more
than one year are shown below (In Millions):
2005 $1,309.3
2006 1,345.9
2007 1,309.0
2008 1,242.1
2009 1,215.0
Later 15,455.4
Total minimum lease payments $21,876.7
The above minimum lease payments include minimum rental commitments related to capital leases of $68.0 million at August 31,
2004. This capital lease amount includes $32.0 million of executory costs and imputed interest. Total minimum lease payments
have not been reduced by minimum sublease rentals of approximately $46.8 million on leases due in the future under non-
cancelable subleases.
The company remains secondarily liable on 49 assigned leases. The maximum potential of undiscounted future payments is $11.9
million as of August 31, 2004. Lease option dates vary with some extending to 2013. Most of the assignments were a result of the
sale of the “Wag’ s” restaurants in August 1988.