Cracker Barrel 2014 Annual Report Download - page 26

RECENT ACCOUNTING PRONOUNCEMENTS
ADOPTED AND NOT YET ADOPTED
See Note 2 to the accompanying Consolidated Financial
Statements for a discussion of recent accounting guidance
adopted and not yet adopted. None of the accounting
guidance adopted and discussed in Note 2 had a signicant
impact on our consolidated nancial statements. e
Company is currently evaluating the impact of adopting the
accounting guidance discussed in Note 2 which the
Company has not yet adopted.
CRITICAL ACCOUNTING ESTIMATES
We prepare our Consolidated Financial Statements in
conformity with GAAP. e preparation of these nancial
statements requires us to make estimates and assumptions
about future events and apply judgments that aect the
reported amounts of assets, liabilities, revenue, expenses and
related disclosures. We base our estimates and judgments
on historical experience, current trends, outside advice from
parties believed to be experts in such maers and on
various other assumptions that are believed to be reasonable
under the circumstances, the results of which form the
basis for making judgments about the carrying value of assets
and liabilities that are not readily apparent from other
sources. However, because future events and their eects
cannot be determined with certainty, actual results could
dier from those assumptions and estimates, and such dier-
ences could be material.
Our signicant accounting policies are discussed in Note 2
to the Consolidated Financial Statements. Judgments and
uncertainties aecting the application of those policies may
result in materially dierent amounts being reported under
dierent conditions or using dierent assumptions. Critical
accounting estimates are those that:
• management believes are most important to the accurate
portrayal of both our nancial condition and operating
results; and
• require management’s most dicult, subjective or complex
judgments, oen as a result of the need to make estimates
about the eect of maers that are inherently uncertain.
We consider the following accounting estimates to be
most critical in understanding the judgments that are involved
in preparing our Consolidated Financial Statements:
• Impairment of Long-Lived Assets and Provision for Asset
Dispositions
• Insurance Reserves
• Retail Inventory Valuation
• Tax Provision
• Share-Based Compensation
Management has reviewed these critical accounting
estimates and related disclosures with the Audit Commiee
of our Board of Directors.
Impairment of Long-Lived Assets and
Provision for Asset Dispositions
We assess the impairment of long-lived assets whenever
events or changes in circumstances indicate that the carrying
value of an asset may not be recoverable. Recoverability
of assets is measured by comparing the carrying value of the
asset to the undiscounted future cash ows expected to be
generated by the asset. If the total expected future cash ows
are less than the carrying amount of the asset, the carrying
value is wrien down, for an asset to be held and used, to the
estimated fair value or, for an asset to be disposed of, to the
fair value, net of estimated costs of disposal. Any loss resulting
from impairment is recognized by a charge to income.
Judgments and estimates that we make related to the expected
useful lives of long-lived assets and future cash ows are
aected by factors such as changes in economic conditions
and changes in operating performance. e accuracy of s
uch provisions can vary materially from original estimates and
management regularly monitors the adequacy of the
provisions until nal disposition occurs.
We have not made any material changes in our methodology
for assessing impairments during the past three years and
we do not believe that there is a reasonable likelihood that
there will be a material change in the estimates or assump-
tions used by us to assess impairment of long-lived assets.
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