OfficeMax 2005 Annual Report Download - page 56

Notes to Consolidated Financial Statements
1. Summary of Significant Accounting Policies
Nature of Operations
OfficeMax Incorporated (‘‘OfficeMax’’ or the ‘‘Company’’), which was formerly known as Boise
Cascade Corporation, is a leader in both business-to-business and retail office products distribution.
The Company provides office supplies and paper, print and document services, technology
products and solutions and furniture to large, medium and small businesses, governmental offices,
and consumers. OfficeMax customers are serviced by approximately 35,000 associates through
direct sales, catalogs, the Internet and a network of retail stores located throughout the United
States, Canada, Australia, New Zealand and Mexico. The Company’s common stock is traded on
the New York Stock Exchange under the ticker symbol OMX. The Company’s corporate
headquarters is located in Itasca, Illinois, and the OfficeMax website address is www.officemax.com.
On October 29, 2004, the Company sold substantially all of its paper, forest products and
timberland assets for approximately $3.7 billion in cash and other consideration to affiliates of Boise
Cascade, L.L.C., a new company formed by Madison Dearborn Partners LLC (the ‘‘Sale’’). With the
Sale, the Company completed its transition, begun in the mid-1990s, from a predominantly
manufacturing-based company to an independent office products distribution company. In
connection with the Sale, Boise Cascade Corporation changed its company name to OfficeMax
Incorporated. (See Note 2, Sale of Paper, Forest Products and Timberland Assets for additional
information related to the Sale.)
The Company manages its business using three reportable segments: OfficeMax, Contract;
OfficeMax, Retail; and Corporate and Other. Results for periods prior to the Sale include the
operations of the Boise Building Solutions and Boise Paper Solutions segments. Substantially all of
the assets and operations of these segments were included in the Sale. OfficeMax, Contract
markets and sells office supplies and paper, technology products and solutions and office furniture
directly to large corporate and government offices, as well as to small and medium-sized offices
through field salespeople, outbound telesales, catalogs, the Internet and in some markets office
products stores. OfficeMax, Retail markets and sells office supplies and paper, print and document
services, technology products and solutions and office furniture to small and medium-sized
businesses and consumers through a network of retail stores. Boise Building Solutions
manufactured, marketed and distributed various products that are used for construction. Boise
Paper Solutions manufactured, marketed and distributed uncoated free sheet papers,
containerboard, corrugated containers, and newsprint and market pulp.
Consolidation
The consolidated financial statements include the accounts of OfficeMax and all majority owned
subsidiaries as well as those of variable interest entities in which the Company is the primary
beneficiary. All significant intercompany balances and transactions have been eliminated in
consolidation.
Fiscal Year
Effective March 11, 2005, the Company amended its bylaws to make its fiscal year-end on the
last Saturday in December. Prior to this change, all of the Company’s businesses except for its U.S.
retail operations had a December 31 fiscal year-end. The U.S. retail operations maintained a fiscal
year that ended on the last Saturday in December, which in 2004 was December 25. Fiscal year
2005 ended on December 31, 2005 for all reportable segments and businesses. Accordingly, fiscal
year 2005 included 53 weeks for the retail segment. Due primarily to statutory requirements, the
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