Summary of Significant Accounting Policies

Description of Business: As of April 24, 2015, Bob Evans Farms, Inc. (“Bob Evans”) and its subsidiaries (collectively, Bob Evans and its subsidiaries are referred to as the “company,” “we,” “us” and “our”) owned and operated 567 full-service Bob Evans Restaurants in 19 states. Bob Evans Restaurants are primarily located in the Midwest, mid-Atlantic and Southeast regions of the United States. We also produce and distribute pork sausage products and a variety of complementary home-style refrigerated side dishes and frozen food items primarily under the Bob Evans, Owens and Country Creek brand names. These food products are sold primarily to customers throughout the United States through our BEF Foods segment. Additionally, we manufacture and sell similar products to foodservice accounts, including Bob Evans Restaurants and other restaurants and food sellers.

Effective January 28, 2013, we entered into a definitive agreement to sell our Mimi’s Café restaurant chain to Le Duff America, Inc. (“Le Duff”). Le Duff is a U.S.-based subsidiary of Groupe Le Duff, a global bakery and restaurant company headquartered in France. Effective February 15, 2013, we completed the sale of Mimi’s Café to Le Duff. Activity related to Mimi’s Café is classified as discontinued operations in the Fiscal 2014 and 2013 Statements of Net Income.

Principles of Consolidation: The consolidated financial statements include the accounts of Bob Evans and its subsidiaries. Intercompany accounts and transactions have been eliminated. Dollars are in thousands, except share and per share amounts.

Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles ("GAAP") requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities. Actual results could differ from the estimates and assumptions used.

Segment Information: During fiscal 2015, we had two reporting segments: Bob Evans Restaurants and BEF Foods. See Note 11 for detailed segment information. The revenues from these two segments include both net sales to unaffiliated customers and intersegment net sales, which are accounted for on a basis consistent with net sales to unaffiliated customers. Intersegment net sales and other intersegment transactions have been eliminated in the consolidated financial statements. Operating income represents earnings before interest and income taxes. Identifiable assets by segment are those assets that are used in our operations in each segment. General corporate assets consist of corporate property, plant and equipment, long-term investments, note receivables, federal and state income tax receivables and deferred income tax assets.

Fiscal Year: Our fiscal year ends on the last Friday in April. References herein to fiscal 2015, fiscal 2014 and fiscal 2013 refer to fiscal years ended April 24, 2015; April 25, 2014; and April 26, 2013, respectively. All years presented were comprised of 52 weeks.

Revenue Recognition: Revenue in the Bob Evans Restaurants segment is recognized at the point of sale, other than revenue from the sale of gift cards, which is deferred and recognized upon redemption. Revenue in the BEF Foods segment is recognized when products are received by our customers. All revenue is presented net of sales tax collections.

We issue gift cards, which do not have expiration dates or inactivity fees. We recognize revenue from gift cards when they are redeemed by the customer. In addition, we recognize income on unredeemed gift cards (“gift card breakage”) based on historical redemption patterns, referred to as the redemption recognition method. Gift card breakage is recognized proportionately over the period of redemption in net sales in the Consolidated Statements of Net Income. The liability for unredeemed gift cards is included in deferred revenue on the Consolidated Balance Sheets, and was $13,714 and $12,967 at April 24, 2015, and April 25, 2014, respectively.

Revenue in the BEF Foods segment is generally recognized when products are received by our customers. We engage in promotional (sales incentive / trade spend) programs in the form of “off-invoice” deductions, billbacks, cooperative advertising and coupons with our customers. Costs associated with these programs are classified as a reduction of net sales in the period in which the sale occurs.

Promotional (Trade) Spending: We engage in promotional (sales incentive) programs in the form of promotional discounts and coupons at Bob Evans Restaurants, and “off-invoice” deductions, billbacks, and cooperative advertising at BEF Foods. Costs associated with these programs are classified as a reduction of gross sales in the period in which the sale occurs. Promotional spending at Bob Evans Restaurants, primarily comprised of discounts taken on dine in sales, was $53,636, $46,452, and $32,747 for fiscal years 2015, 2014, and 2013, respectively. Promotional spending at BEF Foods, primarily comprised of off invoice deductions and bill backs, was $56,618, $49,130, and $54,499 for fiscal years 2015, 2014, and 2013, respectively.

Shipping and Handling costs: Expenditures related to shipping our BEF Foods products to our customers are expensed when incurred. Shipping and handling costs were $19,308, $18,841 and $16,428 in fiscal 2015, fiscal 2014 and fiscal 2013, respectively, and recorded in the S,G&A line of the Consolidated Statements of Net Income.

Cash Equivalents: We consider all highly liquid instruments with a maturity of three months or less when purchased to be cash equivalents. We did not own any cash equivalents as of April 24, 2015, or April 25, 2014.

Accounts Receivable: Accounts receivable represents amounts owed to us through our operating activities and are presented net of allowance for doubtful accounts. Accounts receivable for Bob Evans Restaurants consist primarily of credit card receivables, while accounts receivable for BEF Foods consist primarily of trade receivables from customer sales. We evaluate the collectability of our accounts receivable based on a combination of factors. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations to us, we record a specific allowance for bad debts against amounts due to reduce the net recognized receivable to the amount we reasonably believe will be collected. In addition, we recognize allowances for bad debts based on the length of time receivables are past due with allowance percentages, based on our historical experiences, applied on a graduated scale relative to the age of the receivable amounts. If circumstances such as higher than expected bad debt experience or an unexpected material adverse change in a major customer’s ability to meet its financial obligations to us were to occur, we estimate the recoverability of amounts due to us could change by a material amount. We had allowance for doubtful accounts of $542, and $71 as of April 24, 2015, and April 25, 2014, respectively. Accounts receivable was reduced by $3,671 and $2,755 as of April 24, 2015, and April 25, 2014, respectively, related to promotional incentives that reduce what is owed to the Company from certain BEF Foods customers.

Concentration of Credit Risk: We maintain cash depository accounts with major banks. Accounts receivable can be potentially exposed to a concentration of credit risk with customers or in particular industries. Such credit risk is considered by management to be limited due to our many retail customers, none of which are considered principal in our total operations. We have two individual customers that in total represent approximately 30% of net sales in our BEF Foods reporting segment, or approximately 10% of net company sales. In addition, we maintain reserves for credit losses and such losses have historically been within our expectations.

Notes Receivable: As a result of the sale of Mimi’s Café to Le Duff, we received a promissory note for $30,000. The Note has an annual interest rate of 1.5% , a term of seven years and a principal and interest payment date of February 2020. Partial prepayments are required prior to maturity if the buyer reaches certain levels of EBITDA during specified periods. Our right to repayment under the Note is subordinated to third party lenders as well as other funding that may be provided by the parent company. In the event of a sale or liquidation of Mimi’s Café by its parent company, our right to repayment may be subordinated to payments owed to the parent company and potentially reduced based on the funds available for repayment. The note was originally valued using a discounted cash flow model. The Company recognized accretion income on the Note of $1,859 and $1,918 in fiscal 2015 and 2014, respectively. This accretion income is reflected within the Net Interest Expense caption of the Consolidated Statements of Net Income.

Inventories: We value our Bob Evans Restaurants inventories at the lower of first-in, first-out cost (“FIFO”) or market and our BEF Foods inventories are determined on an average cost method which approximates a FIFO basis due to the perishable nature of our inventory. Inventory includes raw materials and supplies ($12,898 in fiscal 2015 and $16,163 in fiscal 2014) and finished goods ($11,722 in fiscal 2015 and $9,080 in fiscal 2014).

Property, Plant and Equipment: Property, plant and equipment are recorded at cost less accumulated depreciation. The straight-line depreciation method is used for nearly all capitalized assets, although some assets purchased prior to fiscal 1995 continue to be depreciated using accelerated methods. Depreciation is calculated at rates adequate to amortize costs over the estimated useful lives of buildings and improvements (5 to 50 years) and machinery and equipment (3 to 10 years). Improvements to leased properties are depreciated over the shorter of their useful lives or the initial lease terms. Total depreciation expense from continuing operations was $79,917; $79,299; and $69,201 in fiscal 2015, fiscal 2014 and fiscal 2013, respectively.

In the first quarter we reassessed our overall long-range capital plan and revised the anticipated timing for future store remodel initiatives. It is now anticipated that assets capitalized under the Farm Fresh Refresh remodeling program will have an estimated total life of ten years, rather than seven years, and accordingly useful lives for those affected assets were modified in the first quarter of fiscal year 2015. The change in useful life estimate for these assets resulted in a $1,999 increase to income, net of tax in fiscal 2015, and had a $0.08 impact on diluted earnings per share ("EPS").

As of April 24, 2015, and April 25, 2014, we have capitalized $31,387 and $11,349, respectively related to our new Enterprise Resource Planning system ("ERP"). These costs are included in the construction in progress line of the Consolidated Balance Sheets. During the year ended April 24, 2015, we capitalized internal labor costs of $4,498. This includes $3,242 of capitalized costs for ERP and $1,256 for restaurant construction. During the year ended April 25, 2014, we capitalized internal labor costs of $4,031. This includes $2,264 of capitalized costs for ERP and $1,767 for restaurant construction. The first phase of our ERP system was put in service on April 25, 2015, and has an expected useful life of ten years.

We evaluate property, plant and equipment held and used in the business for impairment whenever events or changes circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. Impairment is determined by comparing the estimated fair value for the asset group to the carrying amount of its assets. If impairment exists, the amount of impairment is measured as the excess of the carrying amount over the estimated fair values of the assets. See Note 5 for further information. Assets for 19 Bob Evans Restaurants' locations, as well as our Richardson, Texas, location totaling $22,243 are classified as Current assets held for sale in the Consolidated Balance Sheet as of April 24, 2015. To be consistent with current period presentation, we have reclassified the assets for the 19 Bob Evans Restaurants' locations to the long-term assets held for sale line in the Consolidated Balance Sheets as of April 25, 2014.

Rabbi Trust Assets: The rabbi trust assets line on the Consolidated Balance Sheets is comprised entirely of assets held under certain deferred compensation arrangements and represent the cash surrender value of company-owned life insurance policies. These life insurance policies are intended to be used as a source of funds to match respective funding obligations in our non-qualified deferred compensation plans. The cash surrender value of company owned life insurance policies totaled $32,302 and $31,972 as of April 24, 2015, and April 25, 2014, respectively, and are restricted to their use as noted above. The cash receipts and payments related to these company owned life insurance proceeds are included in cash flows from operating activities on the Consolidated Statements of Cash Flows and in Selling, general and administrative expenses ("S,G&A") in the Consolidated Statements of Net Income. Changes in the cash surrender value for these assets are reflected within the S,G&A line in the Consolidated Statements of Net Income, and resulted in gains, net of fees, of $742 and $2,249 in fiscal 2015 and 2014, respectively.

Goodwill and Other Intangible Assets: Goodwill, which represents the cost in excess of fair market value of net assets acquired, was $19,634 as of April 24, 2015, and April 25, 2014. The goodwill and intangible assets are related to the BEF Foods segment. In fiscal 2013, we recognized goodwill related to the purchase of the Kettle Creations^® brand (“Kettle Creations”) for $18,067. In addition as part of the purchase of Kettle Creations, we obtained a non-compete agreement with certain executives of the former company. The Kettle Creations non-compete agreement is amortized on a straight-line basis over its estimated economic life of five years. In fiscal 2015 we recorded a $2,761 impairment charge to write off the value of the Kettle Creations trade name. The charge was recorded in the S,G&A line of the Consolidated Statements of Net Income. See Note 10 for further information.

Goodwill and intangible assets with indefinite lives are not amortized, but rather are tested for impairment during the fourth quarter each year or on a more frequent basis when indicators of impairment exist. Goodwill and indefinite lived intangible asset impairment testing involves a comparison of the estimated fair value of reporting units to the respective carrying amount. If the estimated fair value exceeds the carrying amount, then no impairment exists. If the carrying amount exceeds the estimated fair value, then a second step is performed to determine the amount of impairment, if any. We perform our impairment test using a combination of income based and market based approaches. The income based approach indicates the fair value of an asset or business based on the cash flows it can be expected to generate over its remaining useful life. Under the market-based approach, fair value is determined by comparing our reporting units to similar businesses or guideline companies whose securities are actively traded in public markets.

Financial Instruments: The fair values of our financial instrument approximate their carrying values at April 24, 2015, and April 25, 2014. We do not use derivative financial instruments for speculative purposes. See Note 2 for more information.

Accrued Non-Income Taxes: Accrued non-income taxes primarily represent obligations for real estate and personal property taxes, as well as sales and use taxes for Bob Evans Restaurants. Accrued non-income taxes were $14,951 and $17,843 at April 24, 2015, and April 25, 2014, respectively.

Self-Insurance Reserves: We record estimates for certain health, workers’ compensation and general insurance costs that are self-insured programs. Self-insurance reserves include actuarial estimates of both claims filed, carried at their expected ultimate settlement value, and claims incurred but not yet reported. Our liability represents an estimate of the ultimate cost of claims incurred as of the balance sheet date. Self-insurance reserves were $18,900 and $19,874 at April 24, 2015, and April 25, 2014, respectively.

Preopening Expenses: Expenditures related to the opening of new restaurants and the Farm Fresh Refresh remodel initiative, which was completed in fiscal 2014, are expensed when incurred. Preopening expenses were $1,272, $4,378 and $3,899 in fiscal 2015, fiscal 2014 and fiscal 2013, respectively, and recorded in the other operating expenses line of the Consolidated Statements of Net Income.

Advertising Costs: Media advertising is expensed at the time the media first airs. We expense all other advertising costs as incurred. Advertising expense from continuing operations was $38,080, $36,673, and $43,819 in fiscal 2015, fiscal 2014 and fiscal 2013, respectively. Approximately 80% of advertising costs are incurred in the Bob Evans Restaurant segment. Advertising costs are classified in other operating expenses and S,G&A expenses in our restaurant segment and BEF Foods segment, respectively, in the Consolidated Statements of Net Income.

Cost of Sales: Cost of sales represents primarily food cost for Bob Evans Restaurants and cost of materials in the BEF Foods segment. Cost of sales also include carryout supplies for Bob Evans Restaurants. Cash rebates that we receive from suppliers are recorded as a reduction of cost of sales in the periods in which they are earned. The amount of each rebate is directly related to the quantity of product purchased from the supplier. Cost of sales excludes depreciation expense, which is recorded in the depreciation and amortization expense line on the Consolidated Statements of Net Income.

Impairments: Impairment charges on property, plant and equipment and intangible assets are recorded to the S,G&A line of the Consolidated Statements of Net Income with the exception of impairments on assets classified as held-for-sale, which are recorded on a separate line. Asset impairment charges in fiscal 2015 were $8,861 and included impairments of $3,442 recorded to S,G&A for 15 restaurant properties, $2,761 recorded to S,G&A for the write off of a trade name owned by BEF Foods and $2,658 recorded to the Impairments of assets held for sale line for nine restaurant properties. Asset impairment charges in fiscal 2014 were $16,850 and related to $4,470 recorded to S,G&A for seven restaurant properties and certain commercial vehicles and $12,380 recorded to the Impairments of assets held for sale line for 29 restaurant properties and one former BEF Foods production facility. Impairment charges in fiscal 2013 were $4,409, were recorded to S,G&A and related to 13 restaurant properties. See Note 5 and Note 10 for additional information.

Comprehensive Income: Comprehensive income is the same as reported net income as we have no other comprehensive income.

Earnings Per Share: Basic earnings-per-share computations are based on the weighted-average number of shares of common stock outstanding during the period presented. Diluted earnings-per-share calculations reflect the assumed vesting of restricted shares, the exercise and conversion of outstanding employee stock options and the settlement of share-based obligations recorded as liabilities on the Consolidated Balance Sheet (see Note 7 for more information), net of the impact of antidilutive shares.

The numerator in calculating both basic and diluted EPS for each year is reported net income. The denominator is based on the following weighted-average number of common shares outstanding (in thousands):



	2015	2014	2013
Basic	23,489	26,450	28,066
Dilutive shares	160	254	422
Diluted	23,649	26,704	28,488

In fiscal 2015, fiscal 2014, and fiscal 2013, 124,766, 127,201 and 451,842 shares of common stock, respectively, were excluded from the diluted earnings-per-share calculations because they were antidilutive.

Dividends: In Fiscal 2015, we paid four quarterly dividends equal to $0.31 per share on our outstanding common stock. Participants in our deferred compensation plans earn share based dividend equivalents, equal to the per-share cash dividends paid on restricted stock units that have been deferred into those plans. Share based dividend equivalents are recorded as a reduction to retained earnings, with an offsetting increase to capital in excess of par value. Refer to table below (in thousands):



	2015		2014
Cash dividends paid to common stock holders	$	29,056	$	31,694
Dividend equivalent rights earned on deferred restricted stock units	370		575
Total dividends	$	29,426	$	32,269

Stock-based Employee Compensation: The Stock Compensation Topic of the FASB ASC 718 ("ASC 718") requires that we measure the cost of employee services received in exchange for an equity award, such as stock options, restricted stock awards and restricted stock units, based on the estimated fair value of the award on the grant date. The cost is recognized in the income statement over the vesting period of the award on a straight-line basis with the exception of compensation cost related to awards for retirement eligible employees, which are recognized immediately upon grant. Compensation cost recognized is based on the grant date fair value estimated in accordance with ASC 718. See Note 6 for more information.

Leases: We rent certain restaurant facilities under operating leases having initial terms that primarily expire approximately 20 years from inception. The leases typically contain renewal clauses of 5 to 30 years exercisable at our option. Most leases contain either fixed or inflation-adjusted escalation clauses. Rent expense for our operating leases is recorded on a straight-line basis over the lease term. Our straight-line rent calculations do not include an assumption of lease renewal periods. We record the difference between the amount charged to expense and the rent paid as deferred rent in the Consolidated Balance Sheets. We commence lease expense upon delivery of the leased location by the lessor. Rent expense for Bob Evans Restaurants was $5,460, $5,153 and $4,641 in fiscal 2015, fiscal 2014 and fiscal 2013, respectively, and is recorded in the other operating expenses line in the Consolidated Statements of Net Income. Future minimum lease payments, excluding the impact of any available renewal periods, are expected to be $4,461, $4,409, $4,459, $4,494, $4,481, and $39,380 for fiscal years 2016, 2017, 2018, 2019, 2020, and thereafter, respectively.

Income Taxes: We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

We recognize deferred tax assets to the extent that we believe these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

We record uncertain tax positions in accordance with the Income Taxes Topic of the FASB ASC 740 on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits within the income tax expense line in the accompanying Consolidated Statement of Net Income. Accrued interest and penalties are included within the related tax liability line in the Consolidated Balance Sheets.

Commitments and Contingencies: We occasionally use purchase commitment contracts to stabilize the potentially volatile pricing associated with certain commodity items.

We are self-insured for most casualty losses and employee health-care claims up to certain stop-loss limits per claim. We have accounted for liabilities for casualty losses, including both reported claims and incurred but not reported claims, based on information provided by independent actuaries. We have accounted for our employee health-care claims liability through a review of incurred and paid claims history. We do not believe that our calculation of casualty losses and employee health-care claims liabilities would change materially under different conditions and/or different methods. However, due to the inherent volatility of actuarially determined casualty losses and employee health-care claims, it is reasonably possible that we could experience changes in estimated losses, which could be material to net income.

We are from time-to-time involved in ordinary and routine litigation, typically involving claims from customers, employees and others related to operational issues common to the restaurant and food manufacturing industries. Management presently believes that the ultimate outcome of these proceedings, individually or in the aggregate, will not have a material adverse effect on our financial position, cash flows or results of operations. See Note 9 for further information.

Reclassifications: Certain prior period amounts have been reclassified or adjusted to conform to the current presentation. We reclassified $5,052 and $5,001 of Bob Evans Restaurants wages expense related to our store management training program incurred in fiscal 2014 and 2013, respectively, from the S,G&A expenses line to the operating wage and fringe benefit expenses line on the Consolidated Statements of Net Income. We believe these costs are better classified as wage expense rather than S,G&A expense. We also reclassified $1,884 and $1,688 of freight charges related to the transportation of materials between BEF Foods production facilities incurred in fiscal 2014 and 2013, respectively, from the other operating expenses line to the cost of sales line on the Consolidated Statements of Net Income. We believe these costs are better classified as cost of sales as they are incurred as part of the production process. These reclassifications had no impact on reported net income.

Corrections of Prior Period Errors: In fiscal 2015 we corrected immaterial prior period errors related to the accounting for our deferred compensation plans. We recorded adjustments to reflect obligations related to deferred stock compensation as equity instruments, to consolidate common stock and other assets held by our Rabbi Trust and to record share-based dividend equivalent payments earned by deferred compensation plan participants in accordance with the provisions of ASC 710 - Compensation and ASC 718 - Stock Compensation.

The effect of these adjustments to our fiscal 2014 Consolidated Balance Sheet was an increase of capital in excess of par value of $6,371, a reduction of the deferred compensation liability of $3,440, an increase to treasury stock of $2,356, a reduction to retained earnings of $384 and an increase to prepaid expenses and other current assets of $191. While the adjustments are immaterial, the April 25, 2014, Consolidated Balance Sheet, Statement of Stockholders Equity, Statement of Cash Flows and applicable footnote disclosures have been adjusted to reflect these corrections. These adjustments had no effect on the reported amounts of income from continuing operations or net income for fiscal 2014.

We have corrected $1,950 of cash related deferred compensation obligations for the year ended April 25, 2014, from the deferred compensation line within long-term liabilities to the accrued wages and related liabilities line within current liabilities on the Consolidated Balance Sheet as of April 25, 2014 . This reclassification was made to reflect as a current liability the amount of deferred compensation obligations scheduled to be satisfied in the subsequent 12 months based on the distribution elections of our plan participants.

We have corrected $2,755 of accrued promotional incentives sales deductions for the year ended April 25, 2014, from the other accrued expenses line to the accounts receivable line on the Consolidated Balance Sheets. These deductions are now classified in accounts receivable as they are reductions in what is owed to the Company from its customers.

We have corrected $1,481 of reserves for uncertain tax positions for the year ended April 25, 2014, from long-term to current liabilities on the Consolidated Balance Sheets. These reserves are related to uncertain tax positions we expected to resolve in fiscal 2015.

New Accounting Pronouncements: In the normal course of business, management evaluates all new accounting pronouncements issued by the FASB, the Securities and Exchange Commission (“SEC”), the Emerging Issues Task Force, the American Institute of Certified Public Accountants or any other authoritative accounting body to determine the potential impact they may have on the Company’s consolidated financial statements.

In May 2014, the FASB and the International Accounting Standards Board (IASB) issued new joint guidance surrounding revenue recognition. Under U.S. generally accepted accounting principles ("US GAAP"), this guidance is being introduced to the ASC as Topic 606, Revenue from Contracts with Customers ("Topic 606"), by Accounting Standards Update No. 2014-09 ("ASU 2014-09"). The new standard supersedes a majority of existing revenue recognition guidance under US GAAP, and requires companies to recognize revenue when it transfers goods or services to a customer in an amount that reflects the consideration to which a company expects to be entitled. Companies may need to use more judgment and make more estimates while recognizing revenue, which could result in additional disclosures to the financial statements. Topic 606 allows for either a "full retrospective" adoption or a "modified retrospective" adoption. We are currently evaluating which adoption method we will use. The standard is effective for us in fiscal 2018. We are currently evaluating the revenue recognition impact this guidance will have once implemented.

In April 2014, the FASB issued Accounting Standards Update No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU 2014-08"), which is an update to existing guidance related to reporting discontinued operations. The updated guidance states that only those disposals of components of an entity which would represent a strategic shift in operations and has or will have a major impact on operations and financial results will be presented as discontinued operations. This update also requires the assets and liabilities of a discontinued operation to be presented separately in the statement of financial position for all prior periods presented. We adopted ASU 2014-08 in the first quarter of fiscal 2015. This update did not have an impact on the consolidated financial statements.

In August 2014, the FASB issued Accounting Standards Update No. 2014-15, Presentation of Financial Statements - Going Concern ("ASU 2014-15") to provide guidance about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern. The guidance requires management to assess whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity's ability to continue as a going concern within one year after the date that the financial statements are issued. When management identifies such conditions or events, a footnote disclosure is required to disclose their nature, as well as management's plans to alleviate the substantial doubt to continue as a going concern. We do not expect this update to have an impact on the consolidated financial statements.