Coach 2012 Annual Report Download - page 61

COACH, INC.
Notes to Consolidated Financial Statements (Continued)
(dollars and shares in thousands, except per share data)
2. SIGNIFICANT ACCOUNTING POLICIES − (continued)
Net Income Per Share
Basic net income per share is calculated by dividing net income by the weighted-average number of
shares outstanding during the period. Diluted net income per share is calculated similarly but includes
potential dilution from the exercise of stock options and vesting of stock awards.
Reclassification
Certain prior year amounts, specifically relating to cash flows in connection with share-based awards,
have been reclassified to conform to the current year presentation in the Consolidated Statement of Cash
Flows.
Recent Accounting Pronouncements
In May 2011, Accounting Standards Codification 820-10 ‘‘Fair Value Measurements and Disclosures,’’
was amended to clarify certain disclosure requirements and improve consistency with international reporting
standards. This amendment is to be applied prospectively and was effective for the Company beginning
January 1, 2012. The adoption of this amendment did not have a material effect on the Company’s
consolidated financial statements.
Accounting Standards Codification Topic 220, ‘‘Comprehensive Income,’’ was amended in June 2011 to
require entities to present the total of comprehensive income, the components of net income, and the
components of other comprehensive income either in a single continuous statement of comprehensive income
or in two separate but consecutive statements. The amendment does not change the items that must be
reported in other comprehensive income or when an item of other comprehensive income must be reclassified
to net income under current GAAP. This guidance is effective for the Company’s fiscal year and interim
periods beginning July 1, 2012. The Company is currently evaluating this guidance, but does not expect its
adoption to have a material effect on its consolidated financial statements.
In September 2011, Accounting Standards Codification 350-20, ‘‘Intangibles — Goodwill and Other —
Goodwill,’’ was amended to allow entities to assess qualitative factors to determine if it is more-likely-than-
not that goodwill might be impaired, and whether it is necessary to perform the two-step goodwill impairment
test required under current accounting standards. This guidance is effective for the Company’s fiscal year
beginning July 1, 2012. The Company does not expect its adoption to have a material effect on its
consolidated financial statements.
3. ACQUISITIONS
On July 3, 2011, Coach acquired 100% of its domestic retail business in Singapore from the former
distributor, Valiram Group, and on January 1, 2012, acquired 100% of its domestic retail business in Taiwan
from the former distributor, Tasa Meng. The results of the acquired businesses have been included in the
consolidated financial statements since July 3, 2011 and January 1, 2012, respectively, within the
Direct-to-Consumer segment. These acquisitions provide the Company with greater control over the brand in
Singapore and Taiwan, enabling Coach to raise brand awareness and grow market share with regional
consumers. The aggregate purchase prices of the Singapore and Taiwan businesses were $7,595 and $46,916,
respectively, both paid during fiscal 2012.
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