O'Reilly Auto Parts 2008 Annual Report Download - page 35

O’REILLY AUTOMOTIVE 2008 ANNUAL REPORT PG.33
MAN AGEMENT ’S DISCUS SION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
In February 2007, the FASB issued SFAS No. 159, e Fair Value Option for Financial Assets and Financial Liabilities (“SFAS No. 159”). SFAS No.
159 permits entities to measure selected nancial assets and nancial liabilities at fair value. Unrealized gains and losses on items for which the
fair value option has been elected are reported in earnings at each subsequent reporting date. e provisions of SFAS No. 159 are eective as of
the beginning of our 2008 scal year. As we elected not to measure any eligible items using the fair value option in accordance with SFAS No.
159, the adoption of SFAS No. 159 did not have a material impact on our consolidated nancial position, results of operations or cash ows.
In December 2007, the FASB issued SFAS No. 141(R), Business Combinations (revised 2007) (“SFAS No. 141(R)”). SFAS No. 141(R) applies to
any transaction or other event that meets the denition of a business combination. Where applicable, SFAS No. 141(R) establishes principles
and requirements for how the acquirer recognizes and measures identiable assets acquired, liabilities assumed, noncontrolling interest in the
acquiree and goodwill or gain from a bargain purchase. In addition, SFAS No. 141(R) determines what information to disclose to enable users of
the nancial statements to evaluate the nature and nancial eects of the business combination. is statement is to be applied prospectively for
scal years beginning aer December 15, 2008. We do not expect the initial adoption of SFAS No. 141(R) to have a material impact; however,
the impact of SFAS No. 141(R) on a future business combination could be material and would be evaluated at that time.
In December 2007, the FASB issued Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB
No. 51 (“SFAS 160”), which is eective for scal years beginning aer December 15, 2008. SFAS 160 states that accounting and reporting for
minority interests will be recharacterized as noncontrolling interests and classied as a component of equity. e calculation of earnings per
share will continue to be based on income amounts attributable to the parent. SFAS 160 applies to all entities that prepare consolidated nancial
statements, but will aect only those entities that have an outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate
a subsidiary. e provisions of SFAS 160 will be eective for us beginning January 1, 2009, and will be applied prospectively. We do not expect
the adoption of SFAS 160 will have a material impact on our consolidated nancial position, results of operations or cash ows.
In March 2008, the FASB issued Statement No. 161, Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB
Statement No. 133 (“SFAS No. 161”), which requires entities that utilize derivative instruments to provide qualitative disclosures about their
objectives and strategies for using such instruments, as well as any details of credit-risk-related contingent features contained within derivatives.
SFAS No. 161 also requires entities to disclose additional information about the amounts and location of derivatives located within the nancial
statements, how the provisions of FASB Statement No. 133 have been applied, and the impact that hedges have on an entity’s nancial position,
nancial performance and cash ows. SFAS No. 161 is eective for scal years and interim periods beginning aer November 15, 2008, with early
application encouraged. We will adopt the provisions of SFAS No. 161 beginning with our March 2009 interim consolidated nancial statements.
In May 2008, the FASB issued FSP Accounting Principles Board Opinion No. 14-1, Accounting for Convertible Debt Instruments at May Be
Settled in Cash upon Conversion (Including Partial Cash Settlement) (“FSP APB 14-1”). FSP APB 14-1 claries the accounting for convertible
debt instruments that may be settled in cash (including partial cash settlement) upon conversion and species that issuers of such instruments
should separately account for the liability and equity components of certain convertible debt instruments in a manner that reects the issuer’s
nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. FSP APB 14-1 requires bifurcation of a component
of the debt, classication of that component in equity and the accretion of the resulting discount on the debt to be recognized as part of interest
expense in the Company’s consolidated statement of operations. FSP APB 14-1 is eective for scal years and interim periods beginning
aer December 15, 2008, with early application prohibited. We will adopt the provisions of FSP APB 14-1 beginning with our March 2009
interim consolidated nancial statements; however, we do not anticipate that the adoption of FSP APB 14-1 will have a material impact on our
consolidated nancial position, results of operations or cash ows.
In May 2008, the FASB issued SFAS No. 162, e Heirarchy of Generally Accepted Accounting Principles (“SFAS 162”). is standard is intended
to improve nancial reporting by identifying a consistent framework or hierarchy, for selecting accounting principles to be used in preparing
nancial statements that are presented in conformity with generally accepted accounting principles in the United States. SFAS 162 is eective
60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411. “e Meaning of
Present Fairly in Conformity with Generally Accepted Accounting Principles.”