Chili's 2008 Annual Report Download - page 59

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BRINKER INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
5. OTHER GAINS AND CHARGES (Continued)
connection with these actions, we incurred $13.2 million in charges related to asset write-offs for sites
under development and other discontinued projects. In addition, we incurred approximately $6.7 million in
severance, vacation and other benefits, net of income related to the forfeiture of stock-based compensation
awards.
In fiscal 2007, we recorded a $12.9 million charge for long-lived asset impairments resulting from the
decision to close 13 restaurants, including nine Macaroni Grill, three On The Border, and one Chili’s
restaurants. The decision to close the restaurants was based on a comprehensive analysis that examined
restaurants not meeting minimum return on investment thresholds and certain other operating
performance criteria. The $12.9 million charge consists of long-lived asset impairments totaling
$10.7 million and a $2.2 million charge primarily related to remaining lease obligations associated with the
closed restaurants.
6. PREPAID EXPENSES AND OTHER
Prepaid expenses and other consist of the following (in thousands):
2008 2007
Prepaid opening supplies ............................ $ 41,247 $ 38,795
Restricted cash (see Note 1) ......................... 34,435 —
Other .......................................... 30,790 31,720
$106,472 $ 70,515
7. GOODWILL
The changes in the carrying amount of goodwill for the fiscal years ended June 25, 2008 and June 27,
2007 are as follows (in thousands):
2008 2007
Balance at beginning of year ......................... $138,876 $139,500
Goodwill arising from acquisitions ................... 1,357 —
Other ........................................ 138 (624)
Balance at end of year ............................. $140,371 $138,876
8. ACCRUED AND OTHER LIABILITIES
Accrued liabilities consist of the following (in thousands):
2008 2007
Payroll ......................................... $ 94,389 $107,629
Gift cards ....................................... 85,897 83,105
Property tax ..................................... 32,996 31,976
Insurance ....................................... 32,512 31,091
Sales tax ........................................ 30,433 31,002
Other .......................................... 55,716 45,228
$331,943 $330,031
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