Big Lots 2011 Annual Report Download - page 169

53
BIG LOTS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 1 — Basis of Presentation and Summary of Significant Accounting Policies (Continued)
Subsequent Events
We have evaluated events and transactions subsequent to the balance sheet date. Based on this evaluation, we
are not aware of any events or transactions (other than those disclosed elsewhere) that occurred subsequent
to the balance sheet date but prior to filing that would require recognition or disclosure in our consolidated
financial statements.
Note 2 — Property and Equipment — Net
Property and equipment - net consist of:
January 28,
2012 January 29, 2011
(In thousands)
Land and land improvements........................................... $ 45,130 $ 45,104
Buildings and leasehold improvements ................................... 768,074 734,578
Fixtures and equipment ............................................... 637,658 605,492
Computer software costs .............................................. 87,290 84,738
Transportation equipment ............................................. 35,604 21,652
Construction-in-progress .............................................. 38,230 20,592
Property and equipment - cost .................................... 1,611,986 1,512,156
Less accumulated depreciation and amortization...................... 1,039,219 987,250
Property and equipment - net ..................................... $ 572,767 $ 524,906
Property and equipment - cost includes $5.8 million and $7.3 million at January 28, 2012 and January 29, 2011,
respectively, to recognize assets from capital leases. Accumulated depreciation and amortization includes
$2.7 million and $5.2 million at January 28, 2012 and January 29, 2011, respectively, related to capital leases.
During 2011 and 2010, respectively, we invested $131.3 million and $107.6 million of cash in capital
expenditures and we recorded $90.3 million and $78.6 million of depreciation expense.
We incurred $2.2 million, less than $0.1 million, and $0.4 million in asset impairment charges in 2011, 2010,
and 2009, respectively. The charges in 2011 relate to asset impairments from the valuation of the Company’s
oldest airplane. The charges in 2010 and 2009 principally related to the write-down of long-lived assets at one
and four stores identified as part of our annual store impairment review in 2010 and 2009, respectively. There
were no charges in 2011 related to the Company’s annual store impairment review.
Asset impairment charges are included in selling and administrative expenses in our accompanying
consolidated statements of operations. We perform annual impairment reviews of our long-lived assets at the
store level. When we perform the annual impairment reviews, we first determine which stores had impairment
indicators present. We use actual historical cash flows to determine which stores had negative cash flows
within the past two years. For each store with negative cash flows, we obtain future cash flow estimates based
on operating performance estimates specific to each store’s operations that are based on assumptions currently
being used to develop our company level operating plans. If the net book value of a store’s long-lived assets is
not recoverable by the expected future cash flows of the store, we estimate the fair value of the store’s assets
and recognize an impairment charge for the excess net book value of the store’s long-lived assets over their
fair value. The fair value of store assets is estimated based on information available in the marketplace for
similar assets.