Best Buy 2011 Annual Report Download - page 115

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$ in millions, except per share amounts or as otherwise noted
The following table provides a reconciliation of changes in unrecognized tax benefits for fiscal 2011 and 2010:
Balance at February 28, 2009 $349
Gross increases related to prior period tax positions 96
Gross decreases related to prior period tax positions (72)
Gross increases related to current period tax positions 50
Settlements with taxing authorities (24)
Lapse of statute of limitations (6)
Balance at February 27, 2010 $393
Gross increases related to prior period tax positions 36
Gross decreases related to prior period tax positions (90)
Gross increases related to current period tax positions 40
Settlements with taxing authorities —
Lapse of statute of limitations (20)
Balance at February 26, 2011 $359
At February 26, 2011, and February 27, 2010, $233 and $195, respectively, of unrecognized tax benefits would
favorably impact the effective tax rate if recognized.
We recognize interest and penalties (not included in the ‘‘unrecognized tax benefits’’ above), as well as interest received
from favorable tax settlements, as components of income tax expense. Interest expense of $1 and penalties benefit of $4
were recognized as a component of income tax expense in fiscal 2011. At February 26, 2011, and February 27, 2010,
we had accrued interest of $84 and $78, respectively, along with accrued penalties of $0 and $4 at February 26, 2011
and February 27, 2010, respectively.
We file a consolidated U.S. federal income tax return, as well as income tax returns in various states and foreign
jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax
examinations by tax authorities for years before fiscal 2003.
Because existing tax positions will continue to generate increased liabilities for us for unrecognized tax benefits over the
next 12 months, and since we are routinely under audit by various taxing authorities, it is reasonably possible that the
amount of unrecognized tax benefits will change during the next 12 months. An estimate of the amount or range of such
change cannot be made at this time. However, we do not expect the change, if any, to have a material effect on our
consolidated financial condition or results of operations within the next 12 months.
12. Segment and Geographic Information
Segment Information
We have organized our operations into two segments: Domestic and International. These segments are the primary areas
of measurement and decision-making by our chief operating decision maker. The Domestic reportable segment is
comprised of all operations within the U.S. and its territories. The International reportable segment is comprised of all
operations outside the U.S. and its territories. We rely on an internal management reporting process that provides segment
information to the operating income level for purposes of making financial decisions and allocating resources. The
accounting policies of the segments are the same as those described in Note 1, Summary of Significant Accounting
Policies.
115