Jack In The Box 2009 Annual Report Download - page 46

Table of Contents
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 
Nature of operations — Founded in 1951, Jack in the Box Inc. (the “Company”) operates and franchises Jack in the Box® quick-
service restaurants and Qdoba Mexican Grill® (“Qdoba”) fast-casual restaurants in 45 states. The following summarizes the number of
restaurants:
  

Company-operated 1,190 1,346 1,436
Franchised 1,022 812 696
Total system 2,212 2,158 2,132

Company-operated 157 111 90
Franchised 353 343 305
Total system 510 454 395
References to the Company throughout these notes to the consolidated financial statements are made using the first person notations
of “we,” “us” and “our.”
Basis of presentation — The accompanying consolidated financial statements have been prepared in accordance with
U.S. generally accepted accounting principles and the rules and regulations of the Securities and Exchange Commission (“SEC”). During
fiscal 2009, we sold all of our Quick Stuff® convenience stores and fuel stations. These stores and their related activities have been
presented as discontinued operations for all periods presented. Refer to Note 2, Discontinued Operations, for additional information.
Unless otherwise noted, amounts and disclosures throughout these Notes to Consolidated Financial Statements relate to our continuing
operations.
Principles of consolidation — The consolidated financial statements include the accounts of the Company, its wholly-owned
subsidiaries and the accounts of any variable interest entities where we are deemed the primary beneficiary. All significant intercompany
transactions are eliminated.
Reclassifications and adjustments — Certain prior year amounts in the consolidated financial statements have been reclassified to
conform to the fiscal 2009 presentation, including the separation of restaurant operating costs into two components; payroll and employee
benefits, and occupancy and other. We believe the additional detail provided is useful when analyzing the operating results of our
restaurants.
Fiscal year — Our fiscal year is 52 or 53 weeks ending the Sunday closest to September 30. Fiscal years 2009, 2008 and 2007
include 52 weeks.
Use of estimates — In preparing the consolidated financial statements in conformity with U.S. generally accepted accounting
principles, management is required to make certain assumptions and estimates that affect reported amounts of assets, liabilities,
revenues, expenses and the disclosure of contingencies. In making these assumptions and estimates, management may from time to time
seek advice and consider information provided by actuaries and other experts in a particular area. Actual amounts could differ materially
from these estimates.
Cash and cash equivalents — We invest cash in excess of operating requirements in short-term, highly liquid investments with
original maturities of three months or less, which are considered cash equivalents.
Accounts and other receivables, net is primarily comprised of receivables from franchisees, tenants and credit card processors.
Franchisee receivables primarily include rents, royalties, and marketing fees associated with the franchise agreements and receivables
arising from distribution services provided to most franchisees. Tenant receivables relate to subleased properties where we are on the
master lease agreement. We charge interest on past due accounts receivable and accrue interest on notes receivable based on the contractual
terms. The allowance for
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