Commitments and Contingencies

12 Months Ended

Feb. 02, 2013

Commitments and Contingencies

Commitments and Contingencies

19. Commitments and Contingencies

Purchase obligations, which include all legally binding contracts such as firm commitments for inventory purchases, merchandise royalties, equipment purchases, marketing-related contracts, software acquisition/license commitments and service contracts, were $1,472 million and $1,396 million at February 2, 2013 and January 28, 2012, respectively. These purchase obligations are primarily due within three years. We issue inventory purchase orders, which represent authorizations to purchase that are cancelable by their terms. We do not consider purchase orders to be firm inventory commitments. If we choose to cancel a purchase order, we may be obligated to reimburse the vendor for unrecoverable outlays incurred prior to cancellation.

We issue trade letters of credit in the ordinary course of business. Trade letters of credit totaled $1,539 million and $1,516 million at February 2, 2013 and January 28, 2012, respectively, a portion of which are reflected in accounts payable. Standby letters of credit, relating primarily to retained risk on our insurance claims, totaled $76 million and $66 million at February 2, 2013 and January 28, 2012, respectively.

We are exposed to claims and litigation arising in the ordinary course of business and use various methods to resolve these matters in a manner that we believe serves the best interest of our shareholders and other constituents. We believe the recorded reserves in our consolidated financial statements are adequate in light of the probable and estimable liabilities. We do not believe that any of the currently identified claims or litigation will be material to our results of operations, cash flows or financial condition.