Dollar General 2009 Annual Report Download - page 74

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DOLLAR GENERAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of presentation and accounting policies
Basis of presentation
These notes contain references to the years 2009 and 2008, which represent fiscal years ended
January 29, 2010 and January 30, 2009, respectively, each of which were 52-week accounting periods.
The Company completed a merger transaction on July 6, 2007 and therefore fiscal year 2007 includes
separate presentation of the periods before and after the merger. The Company’s fiscal year ends on
the Friday closest to January 31. The consolidated financial statements include all subsidiaries of the
Company, except for its not-for-profit subsidiary which the Company does not control. Intercompany
transactions have been eliminated.
Dollar General Corporation (the ‘‘Company’’) was acquired on July 6, 2007 through a Merger (as
defined and discussed in greater detail in Note 3 below) accounted for as a reverse acquisition.
Although the Company continued as the same legal entity after the Merger, the accompanying
consolidated financial statements are presented for the ‘‘Predecessor’’ and ‘‘Successor’’ relating to the
periods preceding and succeeding the Merger, respectively. As a result of the Company applying
purchase accounting and a new basis of accounting beginning on July 7, 2007, the financial reporting
periods presented are as follows:
• The presentation for 2009 and 2008 reflect the Successor.
• The 2007 periods presented include the Predecessor period of the Company, reflecting 22 weeks
of operating results from February 3, 2007 to July 6, 2007 and 30 weeks of operating results for
the Successor period, reflecting the Merger of the Company and Buck Acquisition Corp.
(‘‘BAC’’) from July 7, 2007 to February 1, 2008.
• BAC’s results of operations for the period from its inception on March 6, 2007 to July 6, 2007
(prior to the Merger on July 6, 2007) are also included in the consolidated financial statements
for the Successor period described above as a result of certain derivative financial instruments
entered into by BAC prior to the Merger, as further described in Note 8. Other than these
financial instruments, BAC had no assets, liabilities, or operations prior to the Merger.
The consolidated financial statements for the Predecessor periods have been prepared using the
Company’s historical basis of accounting. As a result of purchase accounting, the pre-Merger and
post-Merger consolidated financial statements are not comparable.
The Company effected a reverse stock split effective October 12, 2009, of 1 share for each 1.75
shares outstanding as of that date. All share and per share amounts presented in the consolidated
financial statements have been adjusted to reflect the reverse stock split. The Company completed the
initial public offering of its common stock on November 18, 2009, as described in more detail in
Note 2.
Business description
The Company sells general merchandise on a retail basis through 8,828 stores (as of January 29,
2010) in 35 states covering most of the southern, southwestern, midwestern and eastern United States.
The Company has distribution centers (‘‘DCs’’) in Scottsville, Kentucky; Ardmore, Oklahoma; South
Boston, Virginia; Indianola, Mississippi; Fulton, Missouri; Alachua, Florida; Zanesville, Ohio;
Jonesville, South Carolina and Marion, Indiana.
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