GameStop 2010 Annual Report Download - page 88

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Table of Contents
GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
recognized in earnings, thereby offsetting the current earnings effect of the re-measurement of related intercompany loans and foreign currency
assets and liabilities. We do not use derivative financial instruments for trading or speculative purposes. We are exposed to counterparty credit risk
on all of our derivative financial instruments and cash equivalent investments. The Company manages counterparty risk according to the guidelines
and controls established under comprehensive risk management and investment policies. We continuously monitor our counterparty credit risk and
utilize a number of different counterparties to minimize our exposure to potential defaults. We do not require collateral under derivative or
investment agreements.
The fair values of derivative instruments not receiving hedge accounting treatment in the consolidated balance sheets presented herein were as
follows (in millions):
January 29, 2011 January 30, 2010
Assets
Foreign Currency Contracts
Other current assets $ 13.0 $ 20.1
Other noncurrent assets 1.0 —
Liabilities
Foreign Currency Contracts
Accrued liabilities (11.2) (9.0)
Other long-term liabilities (1.6) —
Total derivatives $ 1.2 $ 11.1
As of January 29, 2011, the Company had a series of Foreign Currency Contracts outstanding, with a gross notional value of $495.2 million
and a net notional value of $201.3 million. For the 52 weeks ended January 29, 2011, the Company recognized losses of $7.1 million in selling,
general and administrative expenses related to the trading of derivative instruments. As of January 30, 2010, the Company had a series of Foreign
Currency Contracts outstanding, with a gross notional value of $643.5 million and a net notional value of $356.6 million. For the 52 weeks ended
January 30, 2010, the Company recognized gains of $8.7 million in selling, general and administrative expenses related to the trading of derivative
instruments.
The Company's carrying value of financial instruments approximates their fair value, except for differences with respect to the senior notes.
The fair value of the Company's senior notes payable in the accompanying consolidated balance sheets is estimated based on recent quotes from
brokers. As of January 29, 2011, the senior notes payable had a carrying value of $249.0 million and a fair value of $256.6 million. As of
January 30, 2010, the senior notes payable had a carrying value of $447.3 million and a fair value of $466.0 million.
6. Receivables, Net
Receivables consist primarily of bankcard receivables and other receivables. Other receivables include receivables from Game Informer
magazine advertising customers, receivables from landlords for tenant allowances and receivables from vendors for merchandise returns, vendor
marketing allowances and various other programs. F-18