Stein Mart 2012 Annual Report Download - page 41

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STEIN MART, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables in thousands, except per share amounts)
F-13
The net effect of the adjustments on the Consolidated Statements of Income was to increase Net income by $0.1 million and $7.9 million
for the years ended January 28, 2012 and January 29, 2011, respectively.
Increase (decrease) in Net income: 2011 2010
Inventory markdowns 655$ (707)$
Leasehold improvement costs 1,937 2,037
Compensated absences (134) 429
Othe
r
(2,283) 47
Total adjustments before tax 175 1,806
Income tax expense (benefit) from adjustments 72 (6,127)
Increase in Net income 103$ 7,933$
The adjustments in “Other” in 2011 relate primarily to the correction of a previously recorded out of period adjustment related to credit card
reward income breakage of $2.0 million. The tax benefit in 2010 is related to the reversal of the valuation allowance attributable to the
increase in prior period deferred tax assets due to the cumulative impact of the restatement adjustments noted above. These deferred tax
assets had a full valuation allowance in 2008 and 2009.
The decrease to retained earnings from the adjustments as of January 30, 2010, is as follows:
Inventory markdowns (1,891)$
Leasehold improvement costs (8,982)
Compensated absences (6,737)
Other (81)
Income tax effect of adjustments (12)
Decrease to retained earnings (17,703)$