The Gap 2010 Annual Report Download - page 57

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The activity related to asset retirement obligations includes adjustments to the asset retirement obligation
balance and fluctuations in foreign currency rates. The activity was not material for fiscal 2010 or 2009.
Accumulated Other Comprehensive Income
Accumulated OCI consists of the following:
($ in millions) January 29,
2011 January 30,
2010
Foreign currency translation, net of tax ................................................ $205 $168
Accumulated changes in fair value of derivative financial instruments, net of tax .......... (20) (13)
Accumulated other comprehensive income ............................................ $185 $155
Sales Return Allowance
A summary of activity in the sales return allowance account is as follows:
($ in millions) January 29,
2011 January 30,
2010 January 31,
2009
Balanceatbeginningoffiscalyear .......................................... $22 $21 $22
Additions................................................................. 712 698 700
Returns .................................................................. (712) (697) (701)
Balanceatendoffiscalyear ................................................ $22 $22 $21
Note 3. Acquisition, Goodwill, and Intangible Assets
On September 28, 2008, we acquired all of the outstanding capital stock of Athleta Inc., a women’s sports and
active apparel company based in Petaluma, California, for an aggregate purchase price of $148 million in cash,
including transaction costs. The acquisition allows us to enhance our presence in the growing women’s active
apparel sector. The results of operations for Athleta are included in the Consolidated Statements of Income
beginning September 29, 2008. The impact of the acquisition on the Company’s results of operations, as if the
acquisition had been completed as of the beginning of the periods presented, is not significant.
The purchase price was allocated as follows as of September 28, 2008:
($ in millions)
Goodwill .......................................................................................... $99
Tradename ....................................................................................... 54
Intangible assets subject to amortization ............................................................. 15
Net liabilities assumed ............................................................................. (20)
Totalpurchaseprice................................................................................ $148
All of the assets above have been allocated to the Direct reportable segment. None of the goodwill acquired is
deductible for tax purposes.
During fiscal 2010 and 2009, there were no changes in the carrying amount of goodwill or the trade name.
Intangible assets subject to amortization, consisting primarily of customer relationships, are being amortized over
a weighted-average amortization period of four years and are as follows:
($ in millions) January 29,
2011 January 30,
2010
Gross carrying amount ............................................................... $ 15 $15
Less: Accumulated amortization ...................................................... (12) (8)
Intangible assets subject to amortization, net of accumulated amortization ............... $3 $7
50 Gap Inc. Form 10-K