The Gap 2008 Annual Report Download - page 60

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Restricted Cash
Restricted cash of $41 million and $38 million as of January 31, 2009 and February 2, 2008, respectively, represents
cash that serves as collateral for our insurance obligations and cross-currency interest rate swap and other cash
that is restricted from withdrawal.
Subsequent to January 31, 2009, we received $19 million as a return of collateral for our cross-currency interest rate
swap in connection with the settlement.
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation and consist of the following:
($ in millions) January 31,
2009 February 2,
2008
Leaseholdimprovements ............................................................. $ 3,026 $ 3,077
Furniture and equipment ............................................................. 2,377 2,401
Landandbuildings ................................................................... 988 1,022
Software ............................................................................ 774 655
Construction-in-progress ............................................................. 80 165
Propertyandequipment,atcost ....................................................... 7,245 7,320
Less: Accumulated depreciation ....................................................... (4,312) (4,053)
Propertyandequipment,netofaccumulateddepreciation ............................... $ 2,933 $ 3,267
Depreciation expense for property and equipment was $643 million, $625 million, and $601 million for fiscal 2008,
2007, and 2006, respectively.
Interest expense of $8 million, $10 million, and $8 million related to assets under construction was capitalized in
fiscal 2008, 2007, and 2006, respectively.
We recorded a charge for the impairment of long-lived assets, primarily related to our Stores reportable segment,
of $5 million, $13 million, and $29 million for fiscal 2008, 2007, and 2006, respectively, which is classified as
operating expenses in the Consolidated Statements of Earnings. See Note 4 of Notes to the Consolidated Financial
Statements for the impairment charge related to the closure of Forth & Towne.
Other Long-Term Assets
Other long-term assets consist of the following:
($ in millions) January 31,
2009 February 2,
2008
Long-termtax-relatedassets .......................................................... $326 $350
Goodwill ............................................................................ 99 —
Tradename ......................................................................... 54 —
Leaserightsandkeymoney,netofaccumulatedamortizationof$125and$147 ............. 31 43
Deferred compensation plan assets .................................................... 18 24
Intangible assets subject to amortization ............................................... 13 —
Other ............................................................................... 85 68
Otherlong-termassets ............................................................... $626 $485
See Note 3 of Notes to the Consolidated Financial Statements for goodwill, trade name, and intangible assets
subject to amortization related to the acquisition of Athleta.
Both the cost and accumulated amortization of lease rights and key money are impacted by fluctuations in foreign
currency rates. Amortization expense associated with lease rights and key money was $8 million, $10 million, and
$10 million in fiscal 2008, 2007, and 2006, respectively.
48 Gap Inc. Form 10-K