TJ Maxx 2015 Annual Report Download - page 73

New Accounting Standards: In May 2014, a pronouncement was issued that creates common revenue
recognition guidance for U.S. GAAP and International Financial Reporting Standards. The new guidance supersedes
most preexisting revenue recognition guidance. The core principle of the guidance is that an entity should recognize
revenue to depict the transfer of promised goods or services to customers in an amount that reflects the
consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard
was originally scheduled to be effective for annual reporting periods beginning after December 15, 2016, including
interim periods within that reporting period. In April 2015, the Financial Accounting Standards Board proposed an
update to this rule which would defer its effective date for one year. The proposed update stipulates the new standard
would be effective for annual reporting periods beginning after December 15, 2017, and interim periods therein, with
an option to adopt the standard on the originally scheduled effective date. The standard shall be applied either
retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. For TJX, the
standard will be effective in the first quarter of the fiscal year ending February 2, 2019. TJX is in the process of
evaluating this guidance to determine the impact it will have on our consolidated financial statements.
In April 2015, a pronouncement was issued that allows employers with fiscal year ends that do not coincide with
a calendar month end to make an accounting policy election to measure defined benefit plan assets and obligations
as of the end of the month closest to their fiscal year end. This update is effective for interim and annual reporting
periods beginning after December 15, 2015. TJX is in the process of evaluating this guidance to determine the impact
it will have on our consolidated financial statements.
In April 2015, a pronouncement was issued that requires debt issuance costs related to a recognized debt liability
be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with
debt discounts. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after
December 15, 2015. For TJX, the standard will be effective in the first quarter of fiscal 2017. TJX expects to change
the presentation of our debt issuance costs as prescribed by the new guidance.
In May 2015, a pronouncement was issued that removes the requirement to categorize within the fair value
hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The
pronouncement also removes the requirement to make certain disclosures for all investments that are eligible to be
measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to
investments for which the entity has elected to measure the fair value using that practical expedient. The guidance is
effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. Earlier
application is permitted and TJX has adopted these provisions, including the retrospective application, to all periods
presented in the consolidated financial statements.
In September 2015, a pronouncement was issued that eliminates the requirement to restate prior period financial
statements for measurement period adjustments following a business combination. The guidance requires that the
cumulative impact of a measurement period adjustment be recognized in the reporting period in which the adjustment
is identified. The portion of the adjustment which relates to a prior period should either be presented separately on the
face of the income statement or disclosed in the notes. The guidance is effective for fiscal years, and interim periods
within those fiscal years, beginning after December 15, 2015, with early adoption permitted. The guidance is to be
applied prospectively to adjustments to provisional amounts that occur after the effective date. TJX does not expect
this new guidance to have a material impact on our consolidated financial statements.
In November 2015, a pronouncement was issued that requires entities to present deferred tax assets (DTAs) and
deferred tax liabilities (DTLs) as noncurrent in a classified balance sheet. It simplifies the current guidance, which
requires entities to separately present DTAs and DTLs as current or noncurrent in a classified balance sheet. Netting
of DTAs and DTLs by tax jurisdiction is still required under the new guidance. This pronouncement is effective for
annual periods beginning after December 15, 2016, and interim periods within those fiscal years; early adoption is
permitted. TJX has adopted this guidance as of January 30, 2016, and has applied it retrospectively. As a result, we
have recast the January 31, 2015 consolidated balance sheet to conform to the current period presentation. The
adoption of this standard reduced previously-presented current DTAs by $137.6 million, decreased long-term DTAs
by $2.0 million and reduced long-term DTLs by $139.6 million as of January 31, 2015.
In February 2016, the Financial Accounting Standards Board issued ASU 2016-02, “Leases (Topic 842),” which
will replace the existing guidance in ASC 840, “Leases.” The updated standard aims to increase transparency and
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