OfficeMax 2012 Annual Report Download - page 87

Notes to Consolidated Financial Statements
1. Summary of Significant Accounting Policies
Nature of Operations
OfficeMax Incorporated (“OfficeMax,” the “Company”, “we” or “our”) 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, solutions and office furniture and facilities products to large,
medium and small businesses, government offices and consumers. OfficeMax customers are served by
approximately 29,000 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 Naperville, Illinois, and the OfficeMax website address is www.officemax.com.
The Company manages its business using three reportable segments: OfficeMax, Contract (“Contract
segment” or “Contract”); OfficeMax, Retail (“Retail segment” or “Retail”); and Corporate and Other. The
Contract segment markets and sells office supplies and paper, technology products and solutions, office furniture,
print and document services and facilities products 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,
primarily in foreign markets, through office products stores. The Retail segment 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. Management reviews the
performance of the Company based on these segments. We present information pertaining to our segments in
Note 14, “Segment Information”.
Consolidation
The consolidated financial statements include the accounts of OfficeMax and all majority owned
subsidiaries, except our 88%-owned subsidiary that formerly owned assets in Cuba that were confiscated by the
Cuban government in the 1960’s, which is accounted for as an investment due to various asset restrictions. We
also consolidate the variable interest entities in which the Company is the primary beneficiary. All significant
intercompany balances and transactions have been eliminated in consolidation.
Fiscal Year
The Company’s fiscal year-end is the last Saturday in December. Fiscal year 2012 ended on December 29,
2012, fiscal year 2011 ended on December 31, 2011, and fiscal year 2010 ended on December 25, 2010. Due
primarily to statutory requirements, the Company’s international businesses maintain calendar years with
December 31 year-ends, with the exception of, Grupo OfficeMax S. de R.L. de C.V. (“Grupo OfficeMax”), our
majority-owned joint-venture in Mexico, for which the fiscal year-end is the last Saturday in December
beginning with the 2012 fiscal year. Grupo OfficeMax reported one month in arrears in 2011 and 2010. This
practice was discontinued in 2012, resulting in fiscal year 2012 including 13 months for Grupo OfficeMax. This
change in accounting policy did not have a material impact on the Company’s financial statements, and,
therefore, prior year’s amounts have not been restated. Due to the use of a fiscal year that does not agree to a
calendar month end, fiscal year 2011 included 53 weeks for our U.S. businesses. Fiscal years 2012 and 2010
included 52 weeks for our U.S. businesses.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the
United States of America (“GAAP”) requires management to make estimates and assumptions that affect the
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