Best Buy 2008 Annual Report Download - page 77

$ in millions, except per share amounts or as otherwise noted
The changes in the carrying amount of goodwill and tradenames by segment were as follows in fiscal 2008, 2007 and 2006:
Goodwill Tradenames
Domestic International Total Domestic International Total
Balances at February 26, 2005 $ 3 $510 $ 513 $ — $40 $40
Changes in foreign currency exchange rates — 40 40 — 4 4
Changes resulting from acquisitions 3 1 4 — — —
Balances at February 25, 2006 6 551 557 — 44 44
Changes resulting from acquisitions 369 27 396 17 21 38
Changes resulting from tax adjustment(1) — (21) (21) — — —
Changes in foreign currency exchange rates — (13) (13) — (1) (1)
Balances at March 3, 2007 375 544 919 17 64 81
Changes resulting from acquisitions 75 (4) 71 6 — 6
Changes resulting from tax adjustment(1) —(3)(3)———
Changes in foreign currency exchange rates — 101 101 — 10 10
Balances at March 1, 2008 $450 $638 $1,088 $23 $74 $97
(1) Adjustment related to the resolution of certain tax matters associated with our acquisition of Future Shop and Five Star.
Lease Rights at intervals of 7, 28 and 35 days. Investments in these
securities can be sold for cash at par value on the auction
Lease rights represent costs incurred to acquire the lease of a date if the auction is successful. Substantially all of our
specific commercial property. Lease rights are recorded at cost auction-rate securities are AAA/Aaa-rated and collateralized by
and are amortized to rent expense over the remaining lease student loans, which are guaranteed 95% to 100% by the U.S.
term, including renewal periods, if reasonably assured. government. We also hold auction-rate securities that are in
Amortization periods range up to 18 years, beginning with the the form of municipal revenue bonds, the vast majority of
date we take possession of the property. which are AAA/Aaa-rated and insured by bond insurers. We
The gross cost and accumulated amortization of lease rights do not have any investments in securities that are collateralized
were $37 and $20 at March 1, 2008, and $32 and $13 at by assets that include mortgages or subprime debt. Our intent
March 3, 2007. Lease rights amortization was $5, $4 and $3 with these investments is not to hold these securities to maturity,
in fiscal 2008, 2007 and 2006, respectively. Current lease but to use the periodic auction feature to provide liquidity as
rights amortization is expected to be approximately $3 for each needed. See Note 3, Investments, for further information.
of the next five fiscal years. In accordance with our investment policy, we place our
investments in debt securities with issuers who have high-quality
Investments credit and limit the amount of investment exposure to any one
Debt Securities issuer. The primary objective of our investment activities is to
preserve principal and maintain a desired level of liquidity to
Short-term and long-term investments in debt securities are
meet working capital needs. We seek to preserve principal and
comprised of auction-rate securities, variable-rate demand
minimize exposure to interest-rate fluctuations by limiting
notes, asset-backed securities, municipal debt securities and
default risk, market risk and reinvestment risk.
commercial paper. In accordance with SFAS No. 115,
Accounting for Certain Investments in Debt and Equity Marketable Equity Securities
Securities, and based on our ability to market and sell these
instruments, we classify auction-rate securities and other We also invest in marketable equity securities and classify them
investments in debt securities as available-for-sale and carry as available-for-sale. Investments in marketable equity securities
them at fair value. Auction-rate securities are intended to are included in equity and other investments in our
behave like short-term debt instruments because their interest consolidated balance sheets, and are reported at fair value
rates are reset periodically through an auction process, typically based on quoted market prices. All unrealized holding gains
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