Albertsons 2014 Annual Report Download - page 71

other postretirement plan expenses for inactive and corporate participants in the SUPERVALU Retirement Plan
and certain other corporate costs to reflect the structure under which the Company is now managed. These
changes primarily resulted in the recast of net expenses from the Company’s Retail Food segment to Corporate
for all periods presented and as previously reported in the Company’s Annual Report on Form 10-K for the fiscal
year ended February 23, 2013 and February 25, 2012. These changes did not revise or restate information
previously reported in the Company’s Consolidated Financial Statements for any period, except for the
Consolidated Segment Financial Information.
Transition Services Agreement Revision
During the second quarter of fiscal 2014, the Company revised its presentation of fees earned under its transition
services agreements. The Company historically presented fees earned under its transition services agreements as
a reduction of Selling and administrative expenses in the Consolidated Statements of Operations. The
presentation of such fees earned has been revised and they are now reflected as revenue, within Net sales of
Corporate in the Consolidated Statements of Operations and Consolidated Segment Financial Information, for all
periods. The revision had the effect of increasing both Net sales and Gross profit, with a corresponding increase
in Selling and administrative expenses. These revisions did not impact Operating earnings (loss), Earnings (loss)
from continuing operations before income taxes, Net earnings (loss), cash flows, or financial position for any
period reported. Management has determined that the change in presentation is not material to any period
reported. Prior period amounts shown below have been revised to conform to the current period presentation.
The following table represents the effect of the reclassification of fees earned under transition services
agreements on the Company’s Consolidated Statements of Operations for the comparative periods being
presented in the Consolidated Statements of Operations.
Year Ended February 23, 2013 Year Ended February 25, 2012
As Originally
Reported
% of Net
sales Revision As Revised
% of Net
sales
As Originally
Reported
% of Net
sales Revision
As
Revised
% of Net
sales
Net sales $ 17,097 100.0% $ 42 $ 17,139 100.0% $ 17,336 100.0% $ 47 $17,383 100.0%
Cost of sales 14,803 86.6% — 14,803 86.4% 14,926 86.1% — 14,926 85.9%
Gross profit 2,294 13.4% 42 2,336 13.6% 2,410 13.9% 47 2,457 14.1%
Selling and
administrative
expenses 2,445 14.3% 42 2,487 14.5% 2,222 12.8% 47 2,269 13.1%
Goodwill and
intangible
asset
impairment
charges 6 — — 6 — 92 0.5% — 92 0.5%
Operating (loss)
earnings $ (157) (0.9)% $ — $ (157) (0.9)% $ 96 0.6% $ — $ 96 0.6%
The Company earned $42 and $47 of fees under a previous transition services agreement during fiscal 2013 and
2012, respectively. The Company’s previous transition services agreement with Albertson’s LLC was replaced
with transition services agreements with each of NAI and Albertson’s LLC at the close of the NAI Banner Sale.
See Note 14—Discontinued Operations and Divestitures for additional information regarding the Company’s
transition services agreements. Fees earned under the transition services agreements are recognized as the
administrative services are rendered, which align with the recognition of administrative expenses required to
support the transition services agreements.
Segment Revision
The Company revised its segment presentation of Operating earnings for Retail Food and Corporate for results
previously reported in the first quarter of fiscal 2014 to reflect certain allocated administrative costs as Retail
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