Banana Republic 2014 Annual Report Download - page 77

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We are a party to a variety of contractual agreements under which we may be obligated to indemnify the other
party for certain matters. These contracts primarily relate to our commercial contracts, operating leases,
trademarks, intellectual property, financial agreements, and various other agreements. Under these contracts, we
may provide certain routine indemnifications relating to representations and warranties (e.g., ownership of assets,
environmental or tax indemnifications), or personal injury matters. The terms of these indemnifications range in
duration and may not be explicitly defined. Generally, the maximum obligation under such indemnifications is not
explicitly stated, and as a result, the overall amount of these obligations cannot be reasonably estimated.
Historically, we have not made significant payments for these indemnifications. We believe that if we were to incur
a loss in any of these matters, the loss would not have a material effect on our Consolidated Financial Statements
taken as a whole.
As a multinational company, we are subject to various Actions arising in the ordinary course of our business.
Many of these Actions raise complex factual and legal issues and are subject to uncertainties. As of January 31,
2015, Actions filed against us included commercial, intellectual property, customer, employment, and data privacy
claims, including class action lawsuits. The plaintiffs in some Actions seek unspecified damages or injunctive
relief, or both. Actions are in various procedural stages and some are covered in part by insurance. As of
January 31, 2015 and February 1, 2014, we recorded a liability for an estimated loss if the outcome of an Action is
expected to result in a loss that is considered probable and reasonably estimable. The liability recorded as of
January 31, 2015 and February 1, 2014 was not material for any individual Action or in total. Subsequent to
January 31, 2015 and through the filing date of March 23, 2015, no information has become available that
indicates a change is required that would be material to our Consolidated Financial Statements taken as a whole.
We cannot predict with assurance the outcome of Actions brought against us. Accordingly, developments,
settlements, or resolutions may occur and impact income in the quarter of such development, settlement, or
resolution. However, we do not believe that the outcome of any current Action would have a material effect on our
Consolidated Financial Statements taken as a whole.
Note 17. Segment Information
We identify our operating segments according to how our business activities are managed and evaluated. As of
January 31, 2015, we had four operating segments: Gap Global, Old Navy Global, Banana Republic Global, and
Growth, Innovation, and Digital (“GID”). Each brand's specialty, outlet, online, and franchise operations were
managed by global brand presidents and Piperlime, Athleta, and Intermix were managed by the president of the
GID division. Each of our brands serves customers through its store and online channels, allowing us to execute
on our omni-channel strategy where customers can shop seamlessly in retail stores and online through desktop
or mobile devices. We have determined that each of our operating segments share similar economic and other
qualitative characteristics, and therefore the results of our operating segments are aggregated into one reportable
segment as of January 31, 2015.
Online sales are reflected within the respective results of each brand and region in the net sales below. Fiscal
2012 net sales have been conformed to the current year presentation.