Starbucks 2010 Annual Report Download - page 56

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• we reclassified minority interests previously reported on our consolidated balance sheets as a component of
other long-term liabilities to noncontrolling interests and included it as a component of equity
In June 2009, the FASB issued authoritative guidance on the consolidation of variable interest entities (“VIE”),
which will be effective for our first fiscal quarter of 2011. The new guidance requires a qualitative approach to
identify a controlling financial interest in a VIE, and requires ongoing assessment of whether an entity is a VIE and
whether an interest in a VIE makes the holder the primary beneficiary of the VIE. We believe the adoption of this
new guidance will not have a material effect on our consolidated financial statements.
Note 2: Restructuring Charges
The restructuring efforts we began in fiscal 2008 to rationalize our store portfolio and the non-retail support
organization were essentially completed in fiscal 2010. No material future costs related to these efforts are expected.
On a cumulative basis we closed 918 stores on a global basis as part of this effort.
Restructuring charges by type of cost, by reportable segment and reconciliation of the associated accrued liability (in
millions):
By Type of Cost By Segment
Total
Lease Exit
and Other
Related Costs
Asset
Impairments
Employee
Termination
Costs US International Other
Costs incurred and charged to
expense in fiscal 2010 ...... $ 53.0 $ 53.0 $ 0.2 $ (0.2) $ 27.2 $25.8 $ 0.0
Costs incurred and charged to
expense in fiscal 2009 ...... 332.4 184.2 129.2 19.0 246.3 27.0 59.1
Costs incurred and charged to
expense in fiscal 2008 ...... 266.9 47.8 201.6 17.5 210.9 19.2 36.8
Cumulative costs incurred to
date .................... 652.3 285.0 331.0 36.3 484.4 72.0 95.9
Accrued liability as of
September 28, 2008 ........ $ 53.4 $ 48.0 $ 5.4
Costs incurred in fiscal 2009,
excluding non-cash
charges(1) ................ 211.6 192.6 19.0
Cashpayments ............. (161.0) (137.8) (23.2)
Accrued liability as of
September 27, 2009 ........ $104.0 $ 102.8 $ 1.2
Costs incurred in fiscal 2010,
excluding non-cash
charges(1) ................ 53.4 53.7 (0.3)
Cashpayments ............. (68.2) (67.3) (0.9)
Accrued liability as of
October 3, 2010(2) ......... $ 89.2 $ 89.2 $ 0.0
(1) Non-cash charges and credits for lease exit and other related costs primarily represent deferred rent balances
recognized as expense credits at the cease-use date.
(2) The remaining liability relates to lease obligations for stores that were previously closed where Starbucks has
been unable to terminate the lease or find subtenants for the unused space.
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