CONSOLIDATION OF VARIABLE INTEREST ENTITIES

12 Months Ended

Sep. 29, 2012

Variable Interest Entity, Similar Entity Aggregation, Description

2.	CONSOLIDATION OF VARIABLE INTEREST ENTITIES
	Upon adoption of new accounting guidance for VIEs on October 3, 2010, the Company determined that it is the primary beneficiary of two VIEs which had not been previously consolidated, Ark Hollywood/Tampa Investment, LLC and Ark Connecticut Investment, LLC. The new guidance requires that a single party (including its related parties and de facto agents) be able to exercise their rights to remove the decision maker in order for the “kick-out” rights to be considered substantive. Previously, a simple majority of owners that could exercise kick-out rights was considered a substantive right. This change resulted in the need for consolidation.
	The assets and liabilities associated with the Company’s consolidation of VIEs are as follows:

	September 29, 2012		October 1, 2011
	(in thousands)
Cash and cash equivalents	$	714	$	852
Accounts receivable		1,776		1,423
Inventories		28		23
Prepaid income taxes		235		244
Prepaid expenses and other current assets		13		9
Due from Ark Restaurants Corp. and affiliates (1)		288		410
Fixed assets, net		3,189		3,660
Other long-term assets		71		71
Total assets	$	6,314	$	6,692
Accounts payable	$	153	$	565
Accrued expenses and other current liabilities		1,950		2,076
Total liabilities		2,103		2,641
Equity of variable interest entities		4,211		4,051
Total liabilities and equity	$	6,314	$	6,692

(1) Amounts due from Ark Restaurants Corp. and affiliates are eliminated upon consolidation.

The liabilities recognized as a result of consolidating these VIEs do not represent additional claims on the Company’s general assets; rather, they represent claims against the specific assets of the consolidated VIEs. Conversely, assets recognized as a result of consolidating these VIEs do not represent additional assets that could be used to satisfy claims against the Company’s general assets.