Accounts Receivable

9 Months Ended

Oct. 29, 2011

Accounts Receivable [Abstract]

Accounts Receivable

NOTE 3: ACCOUNTS RECEIVABLE

The components of accounts receivable are as follows:

	October 29, 2011			January 29, 2011			October 30, 2010
Credit card receivables:
Nordstrom VISA credit card receivables	$	1,344		$	1,431		$	1,450
Nordstrom private label card receivables		691			672			652
Total credit card receivables		2,035			2,103			2,102
Allowance for credit losses		(125	)		(145	)		(160	)
Credit card receivables, net		1,910			1,958			1,942
Other accounts receivable		85			68			73
Accounts receivable, net	$	1,995		$	2,026		$	2,015

Other accounts receivable consist primarily of credit and debit card receivables due from third-party financial institutions.

Activity in the allowance for credit losses for the quarter and nine months ended October 29, 2011 and October 30, 2010 is as follows:

	Quarter Ended						Nine Months Ended
	October 29, 2011			October 30, 2010			October 29, 2011			October 30, 2010
Allowance at beginning of period	$	125		$	175		$	145		$	190
Bad debt provision		31			28			82			125
Write-offs		(37	)		(48	)		(119	)		(168	)
Recoveries		6			5			17			13
Allowance at end of period	$	125		$	160		$	125		$	160

For purposes of determining impairment and recording the associated allowance for credit losses, we evaluate our credit card receivables on a collective basis as they are composed of large groups of smaller-balance homogeneous loans and, therefore, are not individually evaluated for impairment.

Under certain circumstances, we may make modifications to payment terms for a customer experiencing financial difficulties in an effort to help the customer avoid bankruptcy and to maximize our recovery of the outstanding balance. These modifications, which meet the definition of troubled debt restructurings ("TDRs"), include reduced or waived fees and finance charges, and/or minimum payments. Receivables classified as TDRs were $62, or 3.1% of our total credit card receivables as of October 29, 2011, $56, or 2.7% of our total credit card receivables as of January 29, 2011 and $54, or 2.6% of our total credit card receivables as of October 30, 2010. As with other aged receivables in our portfolio, the allowance for credit losses related to receivables classified as TDRs is primarily based on our historical aging and delinquency trends and write-off experience, with qualitative consideration of factors affecting the credit quality of our portfolio, including amounts of and trends in TDRs.

Credit Quality

The primary indicators of the credit quality of our credit card receivables are aging and delinquency, particularly the levels of account balances delinquent 30 days or more as these are the accounts most likely to be written off. The following table illustrates the aging and delinquency status of our credit card receivables:

	October 29, 2011					January 29, 2011					October 30, 2010
	Balance		% of Total			Balance		% of Total			Balance		% of Total
Current	$	1,899		93.3	%	$	1,942		92.4	%	$	1,929		91.8	%
1 – 29 days delinquent		80		3.9	%		97		4.6	%		100		4.7	%
30+ days delinquent:
30 – 59 days delinquent		21		1.1	%		24		1.1	%		25		1.2	%
60 – 89 days delinquent		15		0.7	%		17		0.8	%		19		0.9	%
Greater than 90 days delinquent		20		1.0	%		23		1.1	%		29		1.4	%
Total 30+ days delinquent	$	56		2.8	%	$	64		3.0	%	$	73		3.5	%
Total credit card receivables	$	2,035		100.0	%	$	2,103		100.0	%	$	2,102		100.0	%
Receivables not accruing finance charges	$	18				$	14				$	29
Receivables greater than 90 days delinquent and still accruing finance charges	$	11				$	21				$	13

We also evaluate credit quality using FICO credit scores. The following table illustrates the distribution of our credit card receivables across FICO score ranges:

	October 29, 2011					January 29, 2011					October 30, 2010
	Balance		% of Total			Balance		% of Total			Balance		% of Total
FICO Score Range1
801+	$	331		16.3	%	$	314		14.9	%	$	332		15.8	%
720 – 800		728		35.7	%		731		34.8	%		729		34.7	%
660 – 719		545		26.8	%		558		26.5	%		550		26.1	%
600 – 659		253		12.4	%		274		13.0	%		268		12.8	%
001 – 599		115		5.7	%		155		7.4	%		161		7.7	%
Other2		63		3.1	%		71		3.4	%		62		2.9	%
Total credit card receivables	$	2,035		100.0	%	$	2,103		100.0	%	$	2,102		100.0	%

¹  Credit scores for our cardholders are typically updated at least every 60 days. Amounts listed in the table reflect the most recently obtained credit scores as of the dates indicated.

²  Other consists of amounts not yet posted to customers' accounts and receivables from customers for whom FICO scores are temporarily unavailable.