Rationalization Charges

12 Months Ended

Jan. 29, 2012

Restructuring and Related Activities [Abstract]

RATIONALIZATION CHARGES

In fiscal 2008, the Company reduced its square footage growth plans to improve free cash flow, provide stronger returns for the Company and invest in its existing stores to continue improving the customer experience. As a result of this store rationalization plan, the Company determined that it would no longer pursue the opening of approximately 50 U.S. stores that had been in its new store pipeline. The Company expects to dispose of or sublet any remaining pipeline locations over varying periods. The Company also closed 15 underperforming U.S. stores in the second quarter of fiscal 2008, and the Company expects to dispose of or sublet any remaining locations over varying periods.

Also in fiscal 2008, the Company announced that it would exit its EXPO, THD Design Center, Yardbirds and HD Bath businesses (the "Exited Businesses") in order to focus on its core The Home Depot stores. The Company closed the Exited Businesses in the first quarter of fiscal 2009 and expects to dispose of or sublet any remaining locations over varying periods. These steps impacted approximately 5,000 associates in those locations, their support functions and their distribution centers.

Finally, in January 2009 the Company also restructured its support functions to better align the Company’s cost structure. These actions impacted approximately 2,000 associates.

The Company did not incur any material charges related to these actions (collectively, the "Rationalization Charges") in fiscal 2011 and 2010 and recognized $146 million and $951 million in total pretax charges for fiscal 2009 and 2008, respectively. The Company does not expect any further material charges related to these actions.

Activity related to Rationalization Charges for fiscal 2011, 2010 and 2009 was as follows (amounts in millions):



	Asset Impairments		Lease Obligation Costs, net			Severance		Other		Total
Accrued Balance at February 1, 2009	$	38	$	213		$	72	$	20	$	343
Fiscal 2009 Charges	—		84			8		54		146
Cash Uses	—		106			80		71		257
Non-cash Activity	15		—			—		3		18
Accrued Balance at January 31, 2010	23		191			—		—		214
Cash Uses	—		42			—		—		42
Non-cash Activity	19		(9		)	—		—		10
Accrued Balance at January 30, 2011	4		158			—		—		162
Cash Uses	—		29			—		—		29
Non-cash Activity	2		(15		)	—		—		(13		)
Accrued Balance at January 29, 2012	$	2	$	144		$	—	$	—	$	146

Costs related to asset impairments, lease obligations, severance and other miscellaneous costs are included in SG&A in the accompanying Consolidated Statements of Earnings. Asset impairment charges, including contractual costs to complete certain assets, were determined based on fair market value using market data for each individual property. Lease obligation costs represent the present value of contractually obligated rental payments offset by estimated sublet income, including estimates of the time required to sublease the locations. The payments related to the leased locations therefore are not generally incremental uses of cash.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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