Neiman Marcus 2007 Annual Report Download - page 97

Table of Contents
NEIMAN MARCUS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
On April 22, 2005, Neiman Marcus, Inc., formerly Newton Acquisition, Inc. (the Company), and its wholly-owned
subsidiary, Newton Acquisition Merger Sub, Inc. (Merger Sub), were formed and incorporated in the state of Delaware. The Company
is a subsidiary of Newton Holding, LLC (Holding). Holding, the Company and Merger Sub were formed by investment funds
affiliated with TPG Capital (formerly Texas Pacific Group) and Warburg Pincus LLC (collectively, the Sponsors) for the purpose of
acquiring The Neiman Marcus Group, Inc. (NMG). The equity subscriptions were subsequently funded by the Sponsors.
The acquisition of NMG was completed on October 6, 2005 through the merger of Merger Sub with and into NMG, with
NMG being the surviving entity (the Acquisition). Subsequent to the Acquisition, NMG is a subsidiary of the Company, which is
controlled by Holding. The Acquisition was recorded as of October 1, 2005, the beginning of our October accounting period. All
references to "we" and "our" relate to the Company for periods subsequent to the Acquisition and to NMG for periods prior to the
Acquisition.
Prior to the Acquisition, the Company had no independent assets or operations. After the Acquisition, the Company
represents the Successor to NMG since the Company's sole asset is its investment in NMG and its operations consist solely of the
operating activities of NMG as well as costs incurred by the Company related to its investment in NMG. For periods prior to the
Acquisition, NMG is deemed to be the predecessor to the Company. As a result, for periods prior to the Acquisition, the financial
statements of the Company consist of the financial statements of NMG for such periods. The accompanying consolidated statements
of earnings and cash flows present our results of operations and cash flows for the periods preceding the Acquisition (Predecessor) and
the periods succeeding the Acquisition (Successor), respectively.
Our fiscal year ends on the Saturday closest to July 31. Like many other retailers, we follow a 4-5-4 reporting calendar
which resulted in an extra week in fiscal year 2008 (the 53rd week). All references to fiscal year 2008 relate to the 53 weeks ended August 2,
2008; all references to fiscal year 2007 relate to the 52 weeks ended July 28, 2007 and all references to fiscal year 2006 relate to the combined period
comprised of forty-three weeks ended July 29, 2006 (Successor) and the nine weeks ended October 1, 2005 (Predecessor).
The accompanying consolidated financial statements include the amounts of the Company and its subsidiaries. All
significant intercompany accounts and transactions have been eliminated.
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