Neiman Marcus 2004 Annual Report Download - page 50

through our borrowing activities, which are described in Note 5 of the Notes to Consolidated Financial Statements in Item 15.
As of July 30, 2005, we had no borrowings outstanding under our revolving Credit Agreement. Future borrowings under our revolving Credit
Agreement, to the extent of outstanding borrowings, would be affected by interest rate changes.
Our outstanding long-term debt as of July 30, 2005 is at fixed interest rates and would not be affected by interest rate changes. Based upon quoted prices,
the fair value of our senior notes and debentures was $273.9 million as of July 30, 2005 and $268.3 million as of July 31, 2004.
We use derivative financial instruments to manage foreign currency risk related to the procurement of merchandise inventories from foreign sources. We
enter into foreign currency contracts denominated in the euro and British pound. We had foreign currency contracts in the form of forward exchange contracts
in the amount of approximately $44.9 million as of July 30, 2005 and approximately $21.8 million as of July 31, 2004. The market risk inherent in these
instruments was not material to our consolidated financial position, results of operations or cash flows in 2005.
The effects of changes in the U.S. equity and bond markets serve to increase or decrease the value of Pension Plan assets, resulting in increased or
decreased cash funding by the Company. We seek to manage exposure to adverse equity and bond returns by maintaining diversified investment portfolios
and utilizing professional investment managers.
Based on a review of our financial instruments outstanding at July 30, 2005 that are sensitive to market risks, we have determined that there was no
material market risk exposure to our consolidated financial position, results of operations, or cash flows as of such date.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following Consolidated Financial Statements of the Company and supplementary data are included as pages F-1 through F-38 at the end of this
Annual Report on Form 10-K:
Index
Page
Number
Management's Report on Internal Control over Financial Reporting F-2
Report of Independent Registered Public Accounting Firm F-3
Consolidated Balance Sheets F-5
Consolidated Statements of Earnings F-6
Consolidated Statements of Cash Flows F-7
Consolidated Statements of Shareholders' Equity F-8
Notes to Consolidated Financial Statements F-9
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
a. Disclosure Controls and Procedures.
In accordance with Exchange Act Rules 13a-15 and 15d-15, we carried out an evaluation as of July 30, 2005, under the supervision and with the
participation of our Chief Executive Officer and Chief Financial Officer, as well as other key members of our management, of the effectiveness of our
disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act). Based on that evaluation, our Chief Executive
Officer and Chief Financial Officer
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