Impairment Charges

12 Months Ended

Jan. 28, 2012

2. IMPAIRMENT CHARGES:

In fiscal 2011, 2010 and 2009, we incurred non-cash impairment charges totaling approximately $2.1 million, $1.9 million and $15.0 million respectively, which are included in the consolidated statements of income within SG&A. A summary of the charges is presented in the table below (amounts in thousands):


	Fiscal 2011		Fiscal 2010		Fiscal 2009
	Fiscal 2011		Fiscal 2010		Fiscal 2009
Impairment of long-lived assets related to underperforming stores	$	2,073	$	1,868	$	1,134
Impairment of software development costs		–		–		8,058
Impairment of note receivable		–		–		5,834
Total pre-tax impairment charges	$	2,073	$	1,868	$	15,026

Long-lived Asset Impairments: In fiscal 2011, 2010 and 2009, we completed an evaluation of long-lived assets at certain underperforming stores for indicators of impairment and, as a result, recorded impairment charges of approximately $2.1 million, $1.9 million and $1.1 million, respectively. Additionally, in fiscal 2009, we decided to deploy alternative inventory planning and allocation software. As a result, $8.1 million of development costs already incurred related to this project were determined to be impaired.

Note Receivable Impairment: During the second quarter of fiscal 2009, we determined that a $25.8 million note receivable was impaired, based on an independent evaluation of the fair value of the underlying collateral coupled with the debtor's apparent inability to pay the note in full. As a result, we recorded a non-cash impairment charge of approximately $3.8 million, which was determined based on the difference between the book value of the note and the independent evaluation of the fair value of the land at that time. During the fourth quarter of fiscal 2009, based on an updated third-party valuation of the land, we determined that the fair value of the land had declined further and an additional $2.0 million impairment charge was necessary to adjust the note to its current fair value, less estimated costs to sell. During fiscal 2010, we took possession of the land in satisfaction of the note receivable and classified the land within property, plant and equipment on our consolidated balance sheet.