Bed, Bath and Beyond 2014 Annual Report Download - page 25

I. Impairment of Long-Lived Assets
The Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying value of
these assets may exceed their current fair values. Recoverability of assets to be held and used is measured by a comparison of
the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the
carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by
which the carrying amount of the asset exceeds the fair value of the assets. Assets to be disposed of would be separately
presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no
longer depreciated. The assets and liabilities of a disposal group classified as held for sale would be presented separately in the
appropriate asset and liability sections of the balance sheet. The Company has not historically recorded any material
impairment to its long-lived assets. In the future, if events or market conditions affect the estimated fair value to the extent
that a long-lived asset is impaired, the Company will adjust the carrying value of these long-lived assets in the period in which
the impairment occurs.
J. Goodwill and Other Indefinite Lived Intangible Assets
The Company reviews goodwill and other intangibles that have indefinite lives for impairment annually or when events or
changes in circumstances indicate the carrying value of these assets might exceed their current fair values. Impairment testing
is based upon the best information available, including estimates of fair value which incorporate assumptions marketplace
participants would use in making their estimates of fair value. The Company has not historically recorded an impairment to its
goodwill and other indefinite lived intangible assets. As of February 28, 2015, for goodwill related to the North American
Retail operating segment and the Institutional Sales operating segment and certain other indefinite lived intangible assets, the
Company assessed qualitative factors in order to determine whether any events and circumstances existed which indicated that
it was more likely than not that the fair value of these indefinite lived intangible assets did not exceed its carrying value and
concluded no such events or circumstances existed which would require an impairment test being performed. In the future, if
events or market conditions affect the estimated fair value to the extent that an asset is impaired, the Company will adjust the
carrying value of these assets in the period in which the impairment occurs.
Included within other assets in the accompanying consolidated balance sheets as of February 28, 2015 and March 1, 2014,
respectively, are $291.4 million for indefinite lived tradenames and trademarks.
K. Self Insurance
The Company utilizes a combination of insurance and self insurance for a number of risks including workers’ compensation,
general liability, automobile liability and employee related health care benefits (a portion of which is paid by its employees).
Liabilities associated with the risks that the Company retains are estimated by considering historical claims experience,
demographic factors, severity factors and other actuarial assumptions. Although the Company’s claims experience has not
displayed substantial volatility in the past, actual experience could materially vary from its historical experience in the future.
Factors that affect these estimates include but are not limited to: inflation, the number and severity of claims and regulatory
changes. In the future, if the Company concludes an adjustment to self insurance accruals is required, the liability will be
adjusted accordingly.
L. Deferred Rent
The Company accounts for scheduled rent increases contained in its leases on a straight-line basis over the term of the lease
beginning as of the date the Company obtained possession of the leased premises. Deferred rent amounted to $77.8 million
and $79.0 million as of February 28, 2015 and March 1, 2014, respectively.
Cash or lease incentives (‘‘tenant allowances’’) received pursuant to certain store leases are recognized on a straight-line basis
as a reduction to rent over the lease term. The unamortized portion of tenant allowances is included in deferred rent and
other liabilities. The unamortized portion of tenant allowances amounted to $121.0 million and $124.1 million as of
February 28, 2015 and March 1, 2014, respectively.
M. Treasury Stock
The Company has authorization to make repurchases from time to time in the open market or through other parameters
approved by the Board of Directors pursuant to existing rules and regulations.
BED BATH & BEYOND 2014 ANNUAL REPORT
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