Albertsons 2013 Annual Report Download - page 60

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SUPERVALU INC. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars and shares in millions, except per share data, unless otherwise noted)
NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business Description
SUPERVALU INC. (“SUPERVALU” or the “Company”) operates primarily in the United States grocery
channel. SUPERVALU provides supply chain services, primarily wholesale distribution, operates five
competitive, regionally-based traditional format grocery banners under the Cub Foods, Farm Fresh,
Hornbacher’s, Shop ‘n Save and Shoppers Food & Pharmacy banners, and operates hard discount retail stores
and licenses stores to independent operators under the Save-A-Lot banner.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and all its wholly and majority-
owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in
consolidation. References to the Company refer to SUPERVALU INC. and Subsidiaries.
During the fourth quarter of fiscal 2013, the Company entered into a stock purchase agreement to sell the
operations of the Company’s New Albertson’s, Inc. subsidiary (“New Albertsons” or “NAI”), including the
Acme, Albertsons, Jewel-Osco, Shaw’s and Star Market retail banners and the associated Osco and Sav-on in-
store pharmacies. The sale was completed effective March 21, 2013, during the Company’s first quarter of fiscal
2014. The operations of New Albertsons were acquired from Albertson’s, Inc. during fiscal 2007 and are being
reported as discontinued operations in the Consolidated Statements of Operations for all fiscal years presented.
The assets and liabilities of the NAI disposal group are presented separately in the Consolidated Balance Sheets
for all periods presented. Unless otherwise indicated, references to the Consolidated Statements of Operations
and the Consolidated Balance Sheets in the Notes to the Consolidated Financial Statements exclude all amounts
related to discontinued operations. See Note 15—Discontinued Operations and Divestitures for additional
information regarding these discontinued operations.
Fiscal Year
The Company’s fiscal year ends on the last Saturday in February. The Company’s first quarter consists of
16 weeks while the second, third and fourth quarters each consist of 12 weeks. Because of differences in the
accounting calendars of the Company and its wholly-owned subsidiary, New Albertsons, Inc., the February 23,
2013 and February 25, 2012 Consolidated Balance Sheets include the assets and liabilities related to New
Albertsons, Inc. as of February 21, 2013 and February 23, 2012, respectively. The last three fiscal years consist
of 52 week periods ended February 23, 2013, February 25, 2012 and February 26, 2011.
Use of Estimates
The preparation of the Company’s consolidated financial statements in conformity with accounting principles
generally accepted in the United States of America (“accounting standards”) requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses
for the reporting periods presented. Actual results could differ from those estimates.
Revenue Recognition
Revenues from product sales are recognized at the point of sale for the Retail Food segment, at the point of sale
for Save-A-Lot’s retail operations, and upon delivery for Save-A-Lot’s independent licensees, and upon delivery
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