AutoZone 2014 Annual Report Download - page 129

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The debt securities held at August 30, 2014, had effective maturities ranging from less than one year to
approximately 3 years. The Company did not realize any material gains or losses on its sale of marketable
securities during fiscal 2014, fiscal 2013, or fiscal 2012.
The Company holds 29 securities that are in an unrealized loss position of approximately $93 thousand at August
30, 2014. The Company has the intent and ability to hold these investments until recovery of fair value or
maturity, and does not deem the investments to be impaired on an other than temporary basis. In evaluating
whether the securities are deemed to be impaired on an other than temporary basis, the Company considers factors
such as the duration and severity of the loss position, the credit worthiness of the investee, the term to maturity
and its intent and ability to hold the investments until maturity or until recovery of fair value.
During the second quarter of fiscal 2014, the Company’s insurance captive transferred $28.2 million of its
marketable securities to a trust account to secure its obligations to an insurance company related to future workers
compensation and casualty losses. These securities held by the trust account are included above in total
marketable securities.
Note G – Accumulated Other Comprehensive Loss
Accumulated other comprehensive loss includes certain adjustments to pension liabilities, foreign currency
translation adjustments, certain activity for interest rate swaps and treasury rate locks that qualify as cash flow
hedges and unrealized gains (losses) on available-for-sale securities. Changes in Accumulated other
comprehensive loss, consisted of the following:
(in thousands)
Pension
Liabilit
y
Foreign
Currenc
y
(3)
Net
Unrealized
Gain on
Securities Derivatives Total
Balance at August 25, 2012 ....................
$ (93,967) $ (50,267) $ 351 $ (8,130) $ (152,013)
Other comprehensive income (loss)
before reclassifications ...................
34,178 (12,216) (271) – 21,691
Amounts reclassified from Accumulated
other comprehensive loss (1) ..............
8,928(2)
–
(105)(4) 711(5)
9,534
Balance at August 31, 2013 .................... (50,861)
(62,483) (25) (7,419) (120,788)
Other comprehensive (loss) income
before reclassifications.......................
(17,155) 4,647 157 – (12,351)
Amounts reclassified from Accumulated
other comprehensive loss (1) ..............
4,196(2) –
(56)(4) 96(5) 4,236
Balance at August 30, 2014 .................... $ (63,820) $ (57,836) $ 76 $ (7,323) $ (128,903)
(1) Amounts in parentheses indicate debits to Accumulated other comprehensive loss.
(2) Represents amortization of pension liability adjustments, net of taxes of $2,683 in fiscal 2014 and $5,793 in fiscal 2013,
which is recorded in Operating, selling, general and administrative expenses on the Consolidated Statements of Income.
See “Note L – Pension and Savings Plans” for further discussion.
(3) Foreign currency is not shown net of additional U.S. tax as earnings of non-U.S. subsidiaries are intended to be
permanently reinvested.
(4) Represents realized (losses) gains on marketable securities, net of taxes of $30 in fiscal 2014 and $56 in fiscal 2013, which
is recorded in Operating, selling, general, and administrative expenses on the Consolidated Statements of Income. See
“Note F – Marketable Securities” for further discussion.
(5) Represents gains and losses on derivatives, net of taxes of $87 in fiscal 2014 and $440 is fiscal 2013, which is recorded in
Interest expense, net, on the Consolidated Statements of Income. See “Note E – Derivative Financial Instruments” for
further discussion.
The 2014 pension actuarial loss of $17.2 million and the 2013 pension actuarial gain of $34.2 million include
amounts not yet reflected in periodic pension costs primarily driven by changes in the discount rate.
10-K