Restructuring Charges

6 Months Ended

Aug. 27, 2011

Restructuring and Related Activities [Abstract]

In the fourth quarter of fiscal 2011, we implemented a series of actions to restructure operations in our domestic and international businesses. The fiscal 2011 restructuring included plans to exit the Turkey market, restructure the Best Buy branded stores in China and improve efficiencies in our Domestic segment’s operations. As part of the international restructuring, we also recognized the impairment of certain information technology assets supporting the restructured activities in our International segment. We view these restructuring activities as necessary to meet our long-term growth goals by investing in businesses that have the potential to meet our internal rate of return expectations. We believe these actions will improve the financial performance of our International segment and increase efficiency, enhance customer service and reduce costs in our Domestic segment’s operations.

We incurred $4 of charges related to the fiscal 2011 restructuring in the first six months of fiscal 2012. Of the total charges, $1 related to our Domestic segment and consisted primarily of facility closure costs, partially offset by reductions in expected termination benefits. The remaining $3 related to our International segment, primarily due to the completion of our exit from the Turkey market. We do not expect to incur further material restructuring charges related to our fiscal 2011 restructuring activities in either our Domestic or International segments in the remainder of fiscal 2012. We expect to substantially complete these restructuring activities in fiscal 2012.

All charges incurred in the first six months of fiscal 2012 related to our fiscal 2011 restructuring are included in the restructuring charges line item in our consolidated statements of earnings. The composition of the restructuring charges we incurred in the six months ended August 27, 2011, as well as the cumulative amount incurred through August 27, 2011, for our fiscal 2011 restructuring activities for both the Domestic and International segments, were as follows:



	Domestic					International					Total
	Six Months Ended August 27, 2011			Cumulative Amount through August 27, 2011		Six Months Ended August 27, 2011			Cumulative Amount through August 27, 2011		Six Months Ended August 27, 2011		Cumulative Amount through August 27, 2011
Inventory write-downs	$	—		$	10	$	—		$	14	$	—	$	24
Property and equipment impairments	—			15		—			132		—		147
Termination benefits	(3		)	13		6			18		3		31
Intangible asset impairments	—			10		—			—		—		10
Facility closure and other costs, net	4			4		(3		)	10		1		14
Total	$	1		$	52	$	3		$	174	$	4	$	226

The following table summarizes our restructuring accrual activity during the six months ended August 27, 2011, related to termination benefits and facility closure and other costs:



	Termination Benefits			Facility Closure and Other Costs⁽¹⁾			Total
Balance at February 26, 2011	$	28		$	13		$	41
Charges	6			2			8
Cash payments	(25		)	(11		)	(36		)
Adjustments	(3		)	8			5
Changes in foreign currency exchange rates	—			1			1
Balance at August 27, 2011	$	6		$	13		$	19


⁽¹⁾	Included within the facility closure and other costs adjustments is $10 from the first quarter of fiscal 2011, representing an adjustment to exclude non-cash charges or benefits, which had no impact on our consolidated statements of earnings in the first six months of fiscal 2012.

- 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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