Macy's 2009 Annual Report Download - page 64

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table shows for 2009, the beginning and ending balance of, and the activity associated with,
the severance accrual established in connection with the store closings announced in January 2010:
January 31, 2009
Charged
To Store
Closing Related
Costs Payments January 30, 2010
(millions)
Severance costs ............................. $– $2 $– $2
The Company expects to pay out the accrued severance costs, which are included in accounts payable and
accrued liabilities on the Consolidated Balance Sheets, prior to May 1, 2010.
In January 2009, the Company announced the closure of eleven underperforming Macy’s stores. In
connection with this announcement and the plan to dispose of these locations, the Company incurred $11 million
of store closing-related costs during 2008. Of the $11 million of store closing-related costs incurred in 2008,
approximately $7 million related to lease obligations and other store liabilities and approximately $4 million
related to severance costs.
The following tables show for 2008 and 2009, the beginning and ending balance of, and the activity
associated with, the severance accrual established in connection with the store closings announced in January
2009:
January 31, 2009
Charged
To Store
Closing Related
Costs Payments January 30, 2010
(millions)
Severance costs ............................. $4 $– $(4) $ –
February 2, 2008
Charged
To Store
Closing Related
Costs Payments January 31, 2009
(millions)
Severance costs ............................. $– $4 $– $4
3. Asset Impairment Charges
Asset impairment charges in 2009 includes $115 million related to properties held and used, $10 million of
which is related to store closings announced in January 2010.
Asset impairment charges in 2008 included $136 million related to properties held and used, $40 million of
which related to store closings announced in January 2009, $63 million associated with acquired indefinite-lived
private brand tradenames and $12 million associated with marketable securities.
Long-lived assets held for use are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability of long-
lived assets is based on an estimate of undiscounted future cash flows resulting from the use of those assets in
operation. Measurement of an impairment loss for long-lived assets that management expects to hold and use is
based on the fair value of the asset. When an impairment loss is recognized, the carrying amount of the asset is
reduced to its estimated fair value. As a result of the Company’s projected undiscounted future cash flows related
F-16