Costco 2009 Annual Report Download - page 76

Download and view the complete annual report

Please find page 76 of the 2009 Costco annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 96

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96

The following table shows the components of comprehensive income, net of related tax effects:
2009 2008 2007
Unrealized gain on short-term investments ..................... $ 5 $ — $ 6
Tax provision .............................................. (2) — (2)
Unrealized gain on short term investments, net of tax ............. 3 — 4
Foreign currency translation adjustment ........................ (185) (89) 93
Tax benefit on translation gain (loss) in relation to earnings subject
to repatriation ............................................ — 4 (4)
Other comprehensive (loss) income adjustments, net ............. (182) (85) 93
Net income ............................................... 1,086 1,283 1,083
Total comprehensive income ................................. $ 904 $1,198 $1,176
The components of accumulated other comprehensive income, net of tax, were as follows:
2009 2008
Unrealized gains on short-term investments ................ $ 3 $ —
Foreign currency translation adjustment and other ........... 101 286
Accumulated other comprehensive income ............. $104 $286
Note 7—Stock-Based Compensation Plans
Through the first quarter of fiscal 2006, the Company granted stock options under the Amended and
Restated 2002 Stock Incentive Plan (Second Restated 2002 Plan) and predecessor plans, and since
the fourth quarter of fiscal 2006, the Company has granted RSUs in lieu of stock options under the
Second Restated 2002 Plan. In the second quarter of 2008, the Second Restated 2002 Plan was
amended following shareholder approval and is now referred to as the Third Restated 2002 Plan. The
Third Restated 2002 Plan authorized the issuance of an additional eight million shares of common
stock for future grants in addition to grants previously authorized. The Third Restated 2002 Plan was
amended by the Board of Directors in July 2008 (Fourth Restated 2002 Plan). Under the Fourth
Restated 2002 Plan, prospective grants of RSUs are subject, upon certain terminations of employment,
to quarterly, as opposed to daily vesting. Previously awarded RSU grants continue to involve daily
vesting upon certain terminations of employment. Additionally, employees who attain certain years of
service with the Company will receive shares under accelerated vesting provisions on the annual
vesting date rather than upon qualified retirement. The first grant impacted by these amendments
occurred in the first quarter of 2009. Each share issued in respect of stock bonuses or stock units is
counted as 1.75 shares toward the limit of shares made available under the Fourth Restated 2002
Plan. The Company issues new shares of common stock upon exercise of stock options and vesting of
RSUs.
74