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Summary of Significant Accounting Policies
3 Months Ended
Apr. 30, 2011
Summary of Significant Accounting Policies [Abstract]  
Summary of Significant Accounting Policies
Note A. Summary of Significant Accounting Policies
Basis of Presentation: The consolidated interim financial statements are unaudited and, in the opinion of management, reflect all normal recurring adjustments, the use of retail statistics, and accruals and deferrals among periods required to match costs properly with the related revenue or activity, considered necessary by The TJX Companies, Inc. (together with its subsidiaries, “TJX”) for a fair presentation of its financial statements for the periods reported, all in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) consistently applied. The consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements, including the related notes, contained in TJX’s Annual Report on Form 10-K for the fiscal year ended January 29, 2011 (“fiscal 2011”).
These interim results are not necessarily indicative of results for the full fiscal year, because TJX’s business, in common with the businesses of retailers generally, is subject to seasonal influences, with higher levels of sales and income generally realized in the second half of the year.
The January 29, 2011 condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.
Fiscal Year: During fiscal 2010, TJX amended its bylaws to change its fiscal year end to the Saturday nearest to the last day of January of each year. Previously, TJX’s fiscal year ended on the last Saturday of January. The fiscal year ended January 29, 2011 and the fiscal year ending January 28, 2012 (“fiscal 2012”) are each 52 week fiscal years. This change shifted the timing of TJX’s next 53-week fiscal year to the year ending February 2, 2013.
Share-Based Compensation: Total share-based compensation expense was $15.5 million for the quarter ended April 30, 2011 and $13.3 million for the quarter ended May 1, 2010. These amounts include stock option expense as well as restricted and deferred stock amortization. There were options to purchase 3.1 million shares of common stock exercised during the quarter ended April 30, 2011, leaving options to purchase 21.7 million shares of common stock outstanding as of April 30, 2011.
Cash and Cash Equivalents: TJX generally considers highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. Investments with maturities greater than three months but less than one year at the date of purchase are included in short-term investments. TJX’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks.
Merchandise Inventories: TJX accrues for inventory purchase obligations at the time of shipment by the vendor. As a result, merchandise inventories on TJX’s balance sheet include an accrual for in-transit inventory of $423.9 million at April 30, 2011, $445.7 million at January 29, 2011 and $354.5 million at May 1, 2010. Comparable amounts were reflected in accounts payable at those dates.
New Accounting Standards: There were no new accounting standards issued during the first quarter ended April 30, 2011 that are expected to have a material impact on TJX’s financial condition, results of operations or cash flows.