Home Depot 2012 Annual Report Download - page 45

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39
Comprehensive Income
Comprehensive Income includes Net Earnings adjusted for certain gains and losses that are excluded from Net Earnings
under U.S. generally accepted accounting principles. Adjustments to Net Earnings and Accumulated Other Comprehensive
Income consist primarily of foreign currency translation adjustments.
Foreign Currency Translation
Assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the current rate of exchange on the
last day of the reporting period. Revenues and expenses are generally translated using average exchange rates for the period
and equity transactions are translated using the actual rate on the day of the transaction.
Segment Information
The Company operates within a single reportable segment primarily within North America. Net Sales for the Company
outside the U.S. were $8.4 billion, $8.0 billion and $7.5 billion for fiscal 2012, 2011 and 2010, respectively. Long-lived assets
outside the U.S. totaled $3.1 billion and $3.1 billion as of February 3, 2013 and January 29, 2012, respectively.
Reclassifications
Certain amounts in prior fiscal years have been reclassified to conform with the presentation adopted in the current fiscal
year.
2. CHINA STORE CLOSINGS
In fiscal 2012, the Company closed its remaining seven big box stores in China. As a result of the closings, the Company
recorded a total charge of $145 million, net of tax, in fiscal 2012. Inventory markdown costs of $10 million are included in
Cost of Sales, and $135 million of costs related to the impairment of Goodwill and other assets, lease terminations, severance
and other charges are included in SG&A in the accompanying Consolidated Statements of Earnings.
3. DEBT GUARANTEE
In connection with the sale of HD Supply, Inc. on August 30, 2007, the Company guaranteed a $1.0 billion senior secured
amortizing term loan of HD Supply. The original expiration date of the guarantee was August 30, 2012. In March 2010, the
Company amended the guarantee to extend the expiration date to April 1, 2014. The fair value of the guarantee at August 30,
2007 was $16 million and was recorded as a liability of the Company in Other Long-Term Liabilities. The extension of the
guarantee increased the fair value of the guarantee to $67 million, resulting in a $51 million charge to Interest and Other, net,
for fiscal 2010. In April 2012, the term loan guarantee was terminated. As a result, the Company reversed its $67 million
liability related to the guarantee, resulting in a $67 million pretax benefit to Interest and Other, net, for fiscal 2012.