Walmart 2010 Annual Report Download - page 39

Notes to Consolidated Financial Statements
Walmart 2010 Annual Report 37
2 Accrued Liabilities
Accrued liabilities consist of the following:
January 31,
(Amounts in millions) 2010 2009
Accrued wages and benefits $ 5,986 $ 5,577
Self-insurance 3,224 3,108
Other 9,524 9,427
Total accrued liabilities $18,734 $18,112
Self-Insurance
The company uses a combination of insurance, self-insured retention
and self-insurance for a number of risks, including, but not limited to,
workers’ compensation, general liability, vehicle liability, property and
the company’s obligation for employee-related health care benefits.
Liabilities associated with these risks are estimated by considering his-
torical claims experience, demographic factors, frequency and severity
factors and other actuarial assumptions. In estimating our liability for
such claims, we periodically analyze our historical trends, including loss
development, and apply appropriate loss development factors to the
incurred costs associated with the claims.
3 Net Income Per Common Share
Basic net income per common share attributable to Walmart is based on
the weighted-average number of outstanding common shares. Diluted
net income per common share attributable to Walmart is based on the
weighted-average number of outstanding common shares adjusted for
the dilutive effect of stock options and other share-based awards. The
dilutive effect of stock options and other share-based awards was 11 mil-
lion, 12 million and 6 million shares in fiscal 2010, 2009 and 2008,
respectively. The company had approximately 5 million, 6 million and
62 million option shares outstanding at January 31, 2010, 2009 and 2008,
respectively, which were not included in the diluted net income per share
calculation because their effect would be antidilutive.
For purposes of determining consolidated net income per common share
attributable to Walmart, income from continuing operations attributable
to Walmart and the (loss) gain from discontinued operations, net of tax,
are as follows:
Fiscal Years Ended January 31,
(Amounts in millions) 2010 2009 2008
Income from continuing operations $14,927 $13,753 $13,269
Less consolidated net
income attributable to
noncontrolling interest (513) (499) (406)
Income from continuing operations
attributable to Walmart 14,414 13,254 12,863
Income (loss) from discontinued
operations, net of tax (79) 146 (132)
Consolidated net income
attributable to Walmart $14,335 $13,400 $12,731
4 Short-term Borrowings and Long-term Debt
Information on short-term borrowings and interest rates is as follows:
Fiscal Years Ended January 31,
(Dollar amounts in millions) 2010 2009 2008
Maximum amount outstanding
at any month-end $4,536 $7,866 $9,176
Average daily short-term borrowings 1,596 4,520 5,657
Weighted-average interest rate 0.5% 2.1% 4.9%
Short-term borrowings consist of commercial paper and lines of credit.
Short-term borrowings outstanding at January 31, 2010 and 2009 were
$523 million and $1.5 billion, respectively. The company has certain
lines of credit totaling $9.0 billion, most of which were undrawn as of
January 31, 2010. Of the $9.0 billion in lines of credit, $8.6 billion is
committed with 34 financial institutions. In conjunction with these
lines of credit, the company has agreed to observe certain covenants,
the most restrictive of which relates to maximum amounts of secured
debt and long-term leases. Committed lines of credit are primarily used
to support commercial paper. The portion of committed lines of credit
used to support commercial paper remained undrawn as of January 31,
2010. The committed lines of credit mature at various times starting
between June 2010 and June 2012, carry interest rates in some cases
equal to the company’s one-year credit default swap mid-rate spread
and in other cases LIBOR plus 15 basis points and incur commitment
fees of 4.0 to 10.0 basis points on undrawn amounts.