Goodwill and Intangible Assets

9 Months Ended

Nov. 26, 2011

Goodwill and Intangible Assets Disclosure [Abstract]

The changes in the carrying values of goodwill and indefinite-lived tradenames by segment were as follows in the nine months ended November 26, 2011, and November 27, 2010:



	Goodwill								Indefinite-lived Tradenames
	Domestic		International			Total			Domestic			International			Total
Balances at February 26, 2011	$	422	$	2,032		$	2,454		$	21		$	84		$	105
Changes in foreign currency exchange rates	—		(38		)	(38		)	—			(2		)	(2		)
Acquisitions	4		—			4			1			—			1
Impairments	—		—			—			(3		)	—			(3		)
Other⁽¹⁾	—		—			—			—			28			28
Balances at November 26, 2011	$	426	$	1,994		$	2,420		$	19		$	110		$	129


⁽¹⁾	Represents the transfer of certain definite-lived tradenames (at their net book value) to indefinite-lived tradenames following our decision to no longer phase out certain tradenames. We believe these tradenames will continue to contribute to our future cash flows indefinitely.



	Goodwill									Indefinite-lived Tradenames
	Domestic			International			Total			Domestic			International		Total
Balances at February 27, 2010	$	434		$	2,018		$	2,452		$	32		$	80	$	112
Sale of business⁽¹⁾	(12		)	—			(12		)	(1		)	—		(1		)
Acquisition of noncontrolling interests	—			5			5			—			—		—
Changes in foreign currency exchange rates	—			(4		)	(4		)	—			2		2
Balances at November 27, 2010	$	422		$	2,019		$	2,441		$	31		$	82	$	113


⁽¹⁾	As a result of the sale of our Speakeasy business in the second quarter of fiscal 2011, we eliminated the carrying value of the related goodwill and indefinite-lived tradenames as of the date of sale.

The following table provides the gross carrying amount of goodwill and cumulative goodwill impairment losses:



	November 26, 2011					February 26, 2011					November 27, 2010
	Gross Carrying Amount		Cumulative Impairment			Gross Carrying Amount		Cumulative Impairment			Gross Carrying Amount		Cumulative Impairment
Goodwill	$	2,485	$	(65	)	$	2,519	$	(65	)	$	2,506	$	(65	)

The following table provides the gross carrying values and related accumulated amortization of definite-lived intangible assets:



	November 26, 2011					February 26, 2011					November 27, 2010
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Tradenames	$	—	$	—		$	73	$	(45	)	$	74	$	(42	)
Customer relationships	382		(217		)	383		(180		)	387		(167		)
Total	$	382	$	(217	)	$	456	$	(225	)	$	461	$	(209	)

Total amortization expense for the three months ended November 26, 2011, and November 27, 2010, was $8 and $20, respectively, and was $38 and $63 for the nine months then ended, respectively. The estimated future amortization expense for identifiable intangible assets is as follows:



Fiscal Year
Remainder of fiscal 2012	$	9
2013	35
2014	35
2015	35
2016	35
Thereafter	16

Best Buy Europe

In November 2011, we announced strategic changes in respect of Best Buy Europe, our consolidated subsidiary in which Carphone Warehouse holds a 50% noncontrolling interest. The strategic changes included an agreement to buy out Carphone Warehouse's share of the interest in the profit share-based management fee paid to Best Buy Europe pursuant to the 2007 Best Buy Mobile agreement (the "profit share agreement") for approximately $1,300 (the "Mobile buy-out"), subject to Carphone Warehouse shareholder approval. This transaction would result in the profit share agreement being fully assigned to a wholly-owned subsidiary of Best Buy and, accordingly, no further profit share payments would be payable to Best Buy Europe. The strategic changes also included plans to close our large-format Best Buy branded stores in the U.K. in the fourth quarter of fiscal 2012.

As of the end of the third quarter of fiscal 2012 and in light of strategic changes outlined above, we performed an interim evaluation of potential impairment of goodwill associated with the Best Buy Europe reporting unit. The fair value of the reporting unit, adjusted to reflect the exit plans for our large-format Best Buy branded stores in the U.K. and the fair value of the profit share agreement indicated by the Mobile buy-out price agreed upon with Carphone Warehouse, was determined to be in excess of carrying value of the Best Buy reporting unit as of the end of the third quarter of fiscal 2012.

However, upon approval by the shareholders of Carphone Warehouse of the Mobile buy-out, no further profit share payments would be payable to Best Buy Europe, which would lead to the new fair value of the reporting unit being significantly lower than the carrying value. Analysis to determine the extent of goodwill impairment that would arise as a result of the Mobile buy-out is ongoing, and preliminary estimates suggest substantially all of the goodwill attributable to the Best Buy Europe reporting unit (approximately $1,200 as of the end of the third quarter of fiscal 2012) would be impaired. If the shareholders of Carphone Warehouse approve the Mobile buy-out, we would record this non-cash impairment of goodwill in the consolidated statement of earnings in the fourth quarter of fiscal 2012.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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