Best Buy 2013 Annual Report Download - page 72

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The following table provides the gross carrying amount and related accumulated amortization of definite-lived intangible assets
($ in millions):
February 2, 2013 March 3, 2012
Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization
Customer relationships $ 475 $ (272) $ 453 $ (224)
Total amortization expense was $38 million, $48 million, and $82 million in fiscal 2013 (11-month), 2012, and 2011,
respectively. At February 2, 2013, future amortization expense for identifiable intangible assets for the next five fiscal years
was expected to be ($ in millions):
Fiscal Year
2014 $ 42
2015 42
2016 42
2017 24
2018 6
Thereafter 47
Lease Rights
Lease rights represent costs incurred to acquire the lease of a specific commercial property. Lease rights are recorded at cost
and are amortized to rent expense over the remaining lease term, including renewal periods, if reasonably assured.
Amortization periods range up to 15 years, beginning with the date we take possession of the property.
The following table provides the gross carrying amount and related accumulated amortization of lease rights ($ in millions):
February 2, 2013 March 3, 2012
Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization
Lease rights $ 132 $ (73) $ 130 $ (73)
Lease rights amortization expense was $9 million, $13 million, and $14 million in fiscal 2013 (11-month), 2012 and 2011,
respectively. We expect current lease rights amortization expense to be approximately $5 million for each of the next five fiscal
years.
Investments
Debt Securities
Our long-term investments in debt securities are comprised of auction-rate securities ("ARS"). Based on our ability to market
and sell these instruments, we classify ARS as available-for-sale and carry them at fair value. ARS were intended to behave like
short-term debt instruments because their interest rates reset periodically through an auction process, typically at intervals of 7,
28 and 35 days. Investments in these securities can be sold for cash at par value on the auction date if the auction is successful.
The majority of our ARS are AAA/Aaa or AA/Aa rated. The AAA/Aaa rated ARS are collateralized by student loans, which are
guaranteed 95% to 100% by the U.S. government, while the AA/Aa rated ARS are municipal revenue bonds, insured by bond
insurers. We also hold ARS that are in the form of municipal revenue bonds, which are AA/Aa-rated and insured by bond
insurers. We do not have any investments in securities that are collateralized by assets that include mortgages or subprime debt.
Our intent with these investments is to recover the full principal amount through a successful auction process, a sale outside of
the auction process, a refinancing or settlement upon maturity. See Note 5, Investments, for further information.
In accordance with our investment policy, we place our investments in debt securities with issuers who have high-quality credit
and limit the amount of investment exposure to any one issuer. The primary objective of our investment activities is to preserve
principal and maintain a desired level of liquidity to meet working capital needs. We seek to preserve principal and minimize
exposure to interest rate fluctuations by limiting default risk, market risk and reinvestment risk.
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