AutoZone 2008 Annual Report Download - page 96

Download and view the complete annual report

Please find page 96 of the 2008 AutoZone annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 132

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132

SHUWUDQVDFWLRQIRUPRVWRILWVVDOHV$OORZDQFHVIRUSRWHQWLDOFUHGLWORVVHVDUHGHWHUPLQHGEDVHGRQKLVWRULFDO
H[SHULHQFHDQGFXUUHQWHYDOXDWLRQRIWKHFRPSRVLWLRQRIDFFRXQWVUHFHLYDEOH+LVWRULFDOO\FUHGLWORVVHVKDYHEHHQ
ZLWKLQPDQDJHPHQW¶VH[SHFWDWLRQVDQGWKHDOORZDQFHVIRUXQFROOHFWLEOHDFFRXQWVZHUHPLOOLRQDW$XJXVW
DQGPLOOLRQDW$XJXVW7KH&RPSDQ\URXWLQHO\VHOOVWKHPDMRULW\RILWVUHFHLYDEOHVWRDWKLUG
SDUW\DWDGLVFRXQWIRUFDVKZLWKOLPLWHGUHFRXUVH$XWR=RQHKDVUHFRUGHGDPLOOLRQUHFRXUVHUHVHUYHUHODWHGWR
PLOOLRQLQRXWVWDQGLQJIDFWRUHGUHFHLYDEOHVDW$XJXVW7KHUHFRXUVHUHVHUYHDW$XJXVWZDV
PLOOLRQUHODWHGWRPLOOLRQLQRXWVWDQGLQJIDFWRUHGUHFHLYDEOHV
0HUFKDQGLVH,QYHQWRULHV,QYHQWRULHVDUHVWDWHGDWWKHORZHURIFRVWRUPDUNHWXVLQJWKHODVWLQILUVWRXW/,)2
PHWKRG,QFOXGHGLQLQYHQWRU\DUHUHODWHGSXUFKDVLQJVWRUDJHDQGKDQGOLQJFRVWV'XHWRSULFHGHIODWLRQRQWKH
&RPSDQ\¶VPHUFKDQGLVHSXUFKDVHVWKH&RPSDQ\¶VLQYHQWRU\EDODQFHVDUHHIIHFWLYHO\PDLQWDLQHGXQGHUWKHILUVWLQ
ILUVWRXWPHWKRG7KH&RPSDQ\¶VSROLF\LVQRWWRZULWHXSLQYHQWRU\LQH[FHVVRIUHSODFHPHQWFRVWUHVXOWLQJLQFRVW
RIVDOHVEHLQJUHIOHFWHGDWWKHKLJKHUDPRXQW7KHFXPXODWLYHEDODQFHRIWKLVXQUHFRUGHGDGMXVWPHQWZKLFKZLOOEH
UHGXFHGXSRQH[SHULHQFLQJSULFHLQIODWLRQRQRXUPHUFKDQGLVHSXUFKDVHVZDVPLOOLRQDW$XJXVW
DQGPLOOLRQDW$XJXVW
$XWR=RQHKDVHQWHUHGLQWRSD\RQVFDQ³326´DUUDQJHPHQWVZLWKFHUWDLQYHQGRUVZKHUHE\$XWR=RQHZLOOQRW
SXUFKDVHPHUFKDQGLVHVXSSOLHGE\DYHQGRUXQWLOWKDWPHUFKDQGLVHLVXOWLPDWHO\VROGWR$XWR=RQH¶VFXVWRPHUV7LWOH
DQGFHUWDLQULVNVRIRZQHUVKLSUHPDLQZLWKWKHYHQGRUXQWLOWKHPHUFKDQGLVHLVVROGWR$XWR=RQH¶VFXVWRPHUV6LQFH
WKH&RPSDQ\GRHVQRWRZQPHUFKDQGLVHXQGHU326DUUDQJHPHQWVXQWLOMXVWEHIRUHLWLVVROGWRDFXVWRPHUVXFK
PHUFKDQGLVHLVQRWUHFRUGHGLQWKH&RPSDQ\¶VEDODQFHVKHHW8SRQWKHVDOHRIWKHPHUFKDQGLVHWR$XWR=RQH¶V
FXVWRPHUV$XWR=RQHUHFRJQL]HVWKHOLDELOLW\IRUWKHJRRGVDQGSD\VWKHYHQGRULQDFFRUGDQFHZLWKWKHDJUHHGXSRQ
WHUPV$OWKRXJK$XWR=RQHGRHVQRWKROGWLWOHWRWKHJRRGV$XWR=RQHFRQWUROVSULFLQJDQGKDVFUHGLWFROOHFWLRQULVN
DQGWKHUHIRUHJURVVUHYHQXHVXQGHU326DUUDQJHPHQWVDUHLQFOXGHGLQQHWVDOHVLQWKHLQFRPHVWDWHPHQW6DOHVRI
PHUFKDQGLVHXQGHU326DUUDQJHPHQWVDSSUR[LPDWHGPLOOLRQLQILVFDOPLOOLRQLQILVFDODQG
PLOOLRQLQILVFDO0HUFKDQGLVHXQGHU326DUUDQJHPHQWVZDVPLOOLRQDW$XJXVWDQG
PLOOLRQDW$XJXVW
3URSHUW\DQG(TXLSPHQW3URSHUW\DQGHTXLSPHQWLVVWDWHGDWFRVW'HSUHFLDWLRQDQGDPRUWL]DWLRQDUHFRPSXWHG
SULQFLSDOO\XVLQJWKHVWUDLJKWOLQHPHWKRGRYHUWKHIROORZLQJHVWLPDWHGXVHIXOOLYHVEXLOGLQJVWR\HDUV
EXLOGLQJLPSURYHPHQWVWR\HDUVHTXLSPHQWWR\HDUVDQGOHDVHKROGLPSURYHPHQWVRYHUWKHVKRUWHURIWKH
DVVHW¶VHVWLPDWHGXVHIXOOLIHRUWKHUHPDLQLQJOHDVHWHUPZKLFKLQFOXGHVDQ\UHDVRQDEO\DVVXUHGUHQHZDOSHULRGV
'HSUHFLDWLRQDQGDPRUWL]DWLRQLQFOXGHDPRUWL]DWLRQRIDVVHWVXQGHUFDSLWDOOHDVH
,PSDLUPHQWRI/RQJ/LYHG$VVHWV,QDFFRUGDQFHZLWKWKHSURYLVLRQVRI6WDWHPHQWRI)LQDQFLDO$FFRXQWLQJ
6WDQGDUGV1R³$FFRXQWLQJIRUWKH,PSDLUPHQWRU'LVSRVDORI/RQJ/LYHG$VVHWV´³6)$6´WKH
&RPSDQ\HYDOXDWHVWKHUHFRYHUDELOLW\RIWKHFDUU\LQJDPRXQWVRIWKHDVVHWVFRYHUHGE\WKLVVWDQGDUGDQQXDOO\DQG
PRUHIUHTXHQWO\LIHYHQWVRUFKDQJHVLQFLUFXPVWDQFHVLQGLFDWHWKDWWKHFDUU\LQJYDOXHPD\QRWEHUHFRYHUDEOH$V
SDUWRIWKHHYDOXDWLRQWKH&RPSDQ\UHYLHZVSHUIRUPDQFHDWWKHVWRUHOHYHOWRLGHQWLI\DQ\VWRUHVZLWKFXUUHQWSHULRG
RSHUDWLQJORVVHVWKDWVKRXOGEHFRQVLGHUHGIRULPSDLUPHQW7KH&RPSDQ\FRPSDUHVWKHVXPRIWKHXQGLVFRXQWHG
H[SHFWHGIXWXUHFDVKIORZVZLWKWKHFDUU\LQJDPRXQWVRIWKHDVVHWV,ILPSDLUPHQWVDUHLQGLFDWHGWKHDPRXQWE\
ZKLFKWKHFDUU\LQJDPRXQWRIWKHDVVHWVH[FHHGVWKHIDLUYDOXHRIWKHDVVHWVLVUHFRJQL]HGDVDQLPSDLUPHQWORVV1R
LPSDLUPHQWORVVHVZHUHUHFRUGHGLQWKHWKUHH\HDUVHQGHG$XJXVW
*RRGZLOO7KHFRVWLQH[FHVVRIIDLUYDOXHRILGHQWLILDEOHQHWDVVHWVRIEXVLQHVVHVDFTXLUHGLVUHFRUGHGDVJRRGZLOO
,QDFFRUGDQFHZLWKWKHSURYLVLRQVRI6WDWHPHQWRI)LQDQFLDO$FFRXQWLQJ6WDQGDUGV1R³*RRGZLOODQG2WKHU
,QWDQJLEOH$VVHWV´³6)$6´JRRGZLOOKDVQRWEHHQDPRUWL]HGVLQFHILVFDOEXWDQDQDO\VLVLVSHUIRUPHGDW
OHDVWDQQXDOO\WRFRPSDUHWKHIDLUYDOXHRIWKHUHSRUWLQJXQLWWRWKHFDUU\LQJDPRXQWWRGHWHUPLQHLIDQ\LPSDLUPHQW
H[LVWV7KH&RPSDQ\SHUIRUPVLWVDQQXDOLPSDLUPHQWDVVHVVPHQWLQWKHIRXUWKTXDUWHURIHDFKILVFDO\HDUXQOHVV
FLUFXPVWDQFHVGLFWDWHPRUHIUHTXHQWDVVHVVPHQWV1RLPSDLUPHQWORVVHVZHUHUHFRUGHGLQWKHWKUHH\HDUVHQGHG
$XJXVW*RRGZLOOZDVPLOOLRQQHWRIDFFXPXODWHGDPRUWL]DWLRQRIPLOOLRQDVRI$XJXVW
DQG$XJXVW
'HULYDWLYH,QVWUXPHQWVDQG+HGJLQJ$FWLYLWLHV$XWR=RQHLVH[SRVHGWRPDUNHWULVNIURPDPRQJRWKHUWKLQJV
FKDQJHVLQLQWHUHVWUDWHVIRUHLJQH[FKDQJHUDWHVDQGIXHOSULFHV)URPWLPHWRWLPHWKH&RPSDQ\XVHVYDULRXV
ILQDQFLDOLQVWUXPHQWVWRUHGXFHVXFKULVNV7RGDWHEDVHGXSRQWKH&RPSDQ\¶VFXUUHQWOHYHORIIRUHLJQRSHUDWLRQV

10-K