Papa Johns 2012 Annual Report Download - page 71

65
2. Significant Accounting Policies (continued)
Redeemable Noncontrolling Interests
Noncontrolling interests associated with our joint ventures that are mandatorily redeemable are reported
in other long-term liabilities in our consolidated balance sheets at redemption value. Other redeemable
noncontrolling interests associated with our joint ventures are reported in the temporary equity section of
our consolidated balance sheets (between total liabilities and stockholders’ equity).
For our joint ventures, consolidated net income is required to be reported separately at amounts
attributable both to the parent and the redeemable noncontrolling interest. Additionally, disclosures are
required to clearly identify and distinguish between the interests of the parent company and the interests
of the noncontrolling owners, including a disclosure on the face of the consolidated statements of income
attributable to the redeemable noncontrolling interest holder.
See Notes 3, 4 and 22 for additional information regarding our redeemable noncontrolling interests.
New Accounting Pronouncements
The Company adopted the required ASUs 2011-05 and 2011-12, “Comprehensive Income: Presentation
of Comprehensive Income,” in 2012 on a retrospective basis. The updated guidance does not change the
components of comprehensive income, but eliminates certain options for presenting comprehensive
income in the financial statements. In accordance with this updated guidance, we no longer present
components of comprehensive income in our consolidated statements of stockholders’ equity. Instead, we
are now required to present components of comprehensive income in either one continuous financial
statement with two sections, net income and comprehensive income, or in two separate but consecutive
statements. We elected the two separate statement approach in the accompanying financial statements.
Reclassifications
Certain other prior year amounts in the consolidated balance sheets and the consolidated statements of
cash flows have been reclassified to conform to the current year presentation, which also had no effect on
current or previously reported net income.
Subsequent Events
The Company evaluated subsequent events through the date the financial statements were issued and
filed. See Note 9 for information regarding our interest rate swap amendment and Note 17 for subsequent
information regarding litigation. There were no other subsequent events that required recognition or
disclosure.
3. Restatement of Previously Issued Financial Statements
In connection with the evaluation of the accounting for newly formed joint ventures in 2012, we reviewed
our accounting for our previously existing joint venture arrangements. As a result of our review, we
determined an error occurred in the accounting for one joint venture agreement, which contained a
mandatorily redeemable feature added through a contract amendment in the third quarter of 2009. This
provision contained in the 2009 contract amendment was not previously considered in determining the
classification and measurement of the noncontrolling interest. In addition, we determined that an
additional redeemable noncontrolling interest was incorrectly classified in shareholders’ equity and
should be classified as temporary equity. As such, we are restating our previously issued consolidated