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Canadian Customs Duty Examination
9 Months Ended
Oct. 31, 2017
Canadian Customs Duty Examination [Abstract]  
Canadian Customs Duty Examination

Note 8 – Canadian Customs Duty Examination

 

In October 2017, the Canada Border Service Agency (“CBSA”) issued a final audit report to G-III Apparel Canada ULC (“G-III Canada”), a wholly-owned subsidiary of the Company. The report challenged the valuation used by G-III Canada for certain goods imported into Canada. The period covered by the examination is February 1, 2014 through the date of the final report, October 27, 2017. The CBSA has requested G-III Canada to reassess its customs entries for that period using the price paid or payable by the Canadian retail customers for certain imported goods rather than the price paid by G-III Canada to the vendor. The CBSA has also requested that G-III Canada change the valuation method used to pay duties with respect to future imported goods. G-III Canada is required to make a pre-payment to the CBSA of the additional duties as a result of the reassessment within 90 days of the date the final report was issued even though G-III Canada intends to appeal this reassessment. The Company has estimated the amount of additional duties that could be payable to the CBSA to be between $9 million to $15 million, plus interest. G-III Canada, based on the advice of counsel, believes it has positions that support its ability to receive a refund of this amount on appeal and intends to vigorously contest the findings of the CBSA.