Albertsons 2007 Annual Report Download - page 82

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SU
PERVAL
U
IN
C
. and
S
ubsidiaries
N
OTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Goodwill and Other Intangible Asset
s
Goodwill re
p
resents the excess of costs over the fair value of net assets in a business combination. Ac
q
uire
d
g
oodwill and intangible assets that are determined to have indefinite useful lives are not amortized, but instead
a
re teste
df
or
i
mpa
i
rment at
l
east annua
ll
y
i
nt
h
e Company’s
f
ourt
h
quarter. Intang
ibl
e assets w
i
t
h
est
i
ma
ble
u
seful lives are amortized over their res
p
ective estimated useful lives and are reviewed for im
p
airment.
I
mpairment o
f
Long-Lived Assets
I
n accordance with the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 144,
“Account
i
ng
f
or t
h
e Impa
i
rment or D
i
sposa
l
o
f
Long-L
i
ve
d
Assets,” t
h
e Company mon
i
tors t
h
e carry
i
ng va
l
ue o
f
l
on
g
-lived assets for potential impairment each quarter based on whether certain tri
gg
erin
g
events have occurred.
T
hese events include current period losses combined with a history of losses or a projection of continuing losses
,
a
s
i
gn
ifi
cant
d
ecrease
i
nt
h
e mar
k
et va
l
ue o
f
an asset or t
h
e Company’s p
l
ans
f
or store c
l
osures. W
h
en a
tri
gg
erin
g
event occurs, a recoverabilit
y
test is performed b
y
comparin
g
pro
j
ected undiscounted future cash flows
to the carrying value of the asset or group of assets as defined in SFAS No. 144. If impairment is identified for
l
ong-
li
ve
d
assets to
b
e
h
e
ld
an
d
use
d
,t
h
eun
di
scounte
df
uture cas
hfl
ows are compare
d
to t
h
e asset’s current
carr
y
in
g
value. Impairment is recorded when the carr
y
in
g
value exceeds the undiscounted future cash flows. Fo
r
l
ong-lived assets that are classified as Assets held for sale, the Company recognizes impairment charges for the
excess o
f
t
h
e carry
i
ng va
l
ue p
l
us est
i
mate
d
costs o
fdi
sposa
l
over t
h
e est
i
mate
df
a
i
rva
l
ue. T
h
ese est
i
mates can
b
e
si
g
nificantl
y
impacted b
y
factors such as chan
g
es in real estate market conditions, the economic environment and
inflation. Impairment charges are a component of Selling and administrative expenses in the Consolidate
d
Statement o
f
Earn
i
ngs.
F
or properties that have closed and are under long-term lease agreements, the present value of any remaining
li
a
bili
ty un
d
er t
h
e
l
ease,
di
scounte
d
us
i
ng cre
di
tr
i
s
k
-
f
ree rates an
d
net o
f
est
i
mate
d
su
bl
ease recovery,
i
s
reco
g
nized as a liabilit
y
and char
g
ed to operations. The value of an
y
equipment and leasehold improvement
s
related to a closed store is reduced to reflect net recoverable values. Internal real estate s
p
ecialists estimate th
e
su
b
tenant
i
ncome,
f
uture cas
hfl
ows an
d
asset recovery va
l
ues
b
ase
d
on t
h
e
i
r
hi
stor
i
ca
l
exper
i
ence an
d
knowled
g
e of (1) the market in which the store to be closed is located, (2) the results of the Compan
y
’s previous
efforts to dis
p
ose of similar assets and (3) the current economic conditions. The actual cost of dis
p
osition fo
r
t
h
ese
l
eases an
d
re
l
ate
d
assets
i
sa
ff
ecte
db
y spec
ifi
c
f
actors suc
h
as rea
l
estate mar
k
ets, t
h
e econom
ic
environment and inflation
.
D
e
f
erred Rent
T
he Company recognizes rent holidays, including the time period during which the Company has access to th
e
property pr
i
or to t
h
e open
i
ng o
f
t
h
es
i
te, as we
ll
as construct
i
on a
ll
owances an
d
esca
l
at
i
ng rent prov
i
s
i
ons, on
a
strai
g
ht-line basis over the term of the lease. The deferred rents are included in Other current liabilities and Othe
r
l
ong-term liabilities on the Consolidated Balance Sheets
.
B
enefit P
l
ans
Th
e Company sponsors pens
i
on an
d
ot
h
er postret
i
rement p
l
ans
i
n var
i
ous
f
orms cover
i
ng su
b
stant
i
a
ll
ya
ll
emplo
y
ees who meet eli
g
ibilit
y
requirements. The determination of the Compan
y
’s obli
g
ation and related
expense for Company-sponsored pension and other postretirement benefits is dependent, in part, o
n
management’s se
l
ect
i
on o
f
certa
i
n assumpt
i
ons use
db
y
i
ts actuar
i
es
i
nca
l
cu
l
at
i
ng t
h
ese amounts. T
h
ese
a
ssumptions include, amon
g
other thin
g
s, the discount rate, the expected lon
g
-term rate of return on plan asset
s
a
nd the rates of increase in com
p
ensation and health care costs
.
F-1
6