Abercrombie & Fitch 2008 Annual Report Download - page 58

Table of Contents
ABERCROMBIE & FITCH CO.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
Abercrombie & Fitch Co. (“A&F”), through its wholly-owned subsidiaries (collectively, A&F and its
wholly-owned subsidiaries are referred to as “Abercrombie & Fitch” or the “Company”), is a specialty
retailer of high-quality, casual apparel for men, women and kids with an active, youthful lifestyle.
The accompanying consolidated financial statements include the historical financial statements of,
and transactions applicable to, the Company and reflect its assets, liabilities, results of operations and cash
flows.
FISCAL YEAR
The Company’s fiscal year ends on the Saturday closest to January 31, typically resulting in a
fifty-two week year, but occasionally giving rise to an additional week, resulting in a fifty-three week
year. Fiscal years are designated in the consolidated financial statements and notes by the calendar year in
which the fiscal year commences. All references herein to “Fiscal 2008” represent the results of the
52-week fiscal year ended January 31, 2009; to “Fiscal 2007” represent the results of the 52-week fiscal
year ended February 2, 2008; and to “Fiscal 2006” represent the results of the 53-week fiscal year ended
February 3, 2007. In addition, all references herein to “Fiscal 2009” represent the 52-week fiscal year that
will end on January 30, 2010.
RECLASSIFICATIONS
In connection with the Company’s adoption of Financial Accounting Standards Board (“FASB”)
Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an Interpretation of FASB
Statement No. 109” (“FIN 48”), on February 4, 2007, a $2.8 million cumulative effect adjustment was
recorded as a reduction to beginning of the year retained earnings. The Company’s unrecognized tax
benefits as of February 4, 2007 were reclassified from current taxes payable to other long-term liabilities.
Additionally, certain amounts have been reclassified to conform to current year presentation in Note 12,
“Income Taxes.” See Note 12, “Income Taxes” for information about the adoption of FIN 48.
SEGMENT REPORTING
In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 131, “Disclosures
about Segments of an Enterprise and Related Information,” (“SFAS No. 131”), the Company determines
its operating segments on the same basis that it uses to evaluate performance internally. The operating
segments identified by the Company are Abercrombie & Fitch, abercrombie, Hollister, RUEHL and Gilly
Hicks. The operating segments have been aggregated and are reported as one reportable financial
segment. RUEHL and Gilly Hicks were determined to be immaterial for segment reporting purposes, and
are, therefore, included in the one reportable segment as they have similar economic characteristics and
meet the majority of the aggregation criteria in paragraph 17 of SFAS No. 131. The Company aggregates
its operating segments because they have similar economic characteristics and meet the aggregation
criteria set forth in paragraph 17 of SFAS No. 131. The Company believes its operating segments may be
aggregated for financial reporting purposes because they are similar in each of the following areas: class
of consumer; economic characteristics; nature of products; nature of production processes; and
distribution methods. Revenues relating to the Company’s international operations for the fifty-two weeks
ended January 31, 2009 and February 2, 2008 and
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Source: ABERCROMBIE & FITCH CO /DE/, 10-K, March 27, 2009 Powered by Morningstar® Document Research℠