Annual report pursuant to Section 13 and 15(d)

Change in Accounting for Retirement-Related Benefits (Notes)

v3.3.1.900
Change in Accounting for Retirement-Related Benefits (Notes)
12 Months Ended
Jan. 30, 2016
Accounting Changes and Error Corrections [Abstract]  
Accounting Changes [Text Block]
Change in Accounting for Retirement-Related Benefits
In 2015, the Company elected to change its method of recognizing pension expense. Previously, for the primary and supplemental pension plans, net actuarial gains or losses in excess of 10% of the greater of the fair value of plan assets or the plans’ projected benefit obligation (the corridor) were recognized over the remaining service period of plan participants (eight years for the primary pension plan). Under the Company’s new accounting method, the Company recognizes changes in net actuarial gains or losses in excess of the corridor annually in the fourth quarter each year (MTM Adjustment). The remaining components of pension expense, primarily service and interest costs and assumed return on plan assets, will be recorded on a quarterly basis. While the historical policy of recognizing pension expense was considered acceptable, the Company believes that the new policy is preferable as it eliminates the delay in recognition of actuarial gains and losses outside the corridor.

This change has been reported through retrospective application of the new policy to all periods presented. The impacts of all adjustments made to the financial statements are summarized below:

Consolidated Statements of Operations
 
2014
 
2013
($ in millions, except per share data)
Previously Reported
 
As Adjusted
 
Effect of Change
 
Previously Reported
 
As Adjusted
 
Effect of Change
Pension
$
6

 
$
(48
)
 
$
(54
)
 
$
137

 
$
(41
)
 
$
(178
)
Income/(loss) before income taxes
(748
)
 
(694
)
 
54

 
(1,886
)
 
(1,708
)
 
178

Income tax expense/(benefit)
23

 
23

 

 
(498
)
 
(430
)
 
68

Net income/(loss)
$
(771
)
 
$
(717
)
 
54

 
$
(1,388
)
 
(1,278
)
 
$
110

Basic earnings/(loss) per common share
$
(2.53
)
 
$
(2.35
)
 
$
0.18

 
$
(5.57
)
 
$
(5.13
)
 
$
0.44

Diluted earnings/(loss) per common share
$
(2.53
)
 
$
(2.35
)
 
$
0.18

 
$
(5.57
)
 
$
(5.13
)
 
$
0.44


Consolidated Statements of Comprehensive Income/(Loss)
 
2014
 
2013
($ in millions)
Previously Reported
 
As Adjusted
 
Effect of Change
 
Previously Reported
 
As Adjusted
 
Effect of Change
Net income/(loss)
$
(771
)
 
$
(717
)
 
$
54

 
$
(1,388
)
 
$
(1,278
)
 
$
110

Reclassifications for amortization of net actuarial (gain)/loss
40

 
7

 
(33
)
 
108

 
(2
)
 
(110
)
Deferred tax valuation allowance
(169
)
 
(190
)
 
(21
)
 

 

 

Total other comprehensive income/(loss), net of tax
(437
)
 
(491
)
 
(54
)
 
490

 
380

 
(110
)
Total comprehensive income/(loss), net of tax
$
(1,208
)
 
$
(1,208
)
 
$

 
$
(898
)
 
$
(898
)
 
$

Consolidated Balance Sheet
 
2014
($ in millions)
Previously Reported
 
As Adjusted
 
Effect of Change
Reinvested earnings/(accumulated deficit)
$
(1,779
)
 
$
(2,494
)
 
$
(715
)
Accumulated other comprehensive income/(loss)
(1,065
)
 
(350
)
 
715

Consolidated Statements of Stockholders' Equity
 
2014
 
2013
($ in millions)
Previously Reported
 
As Adjusted
 
Effect of Change
 
Previously Reported
 
As Adjusted
 
Effect of Change
Reinvested earnings/(loss)
 
 
 
 
 
 
 
 
 
 
 
   Beginning balance
$
(1,008
)
 
$
(1,777
)
 
$
(769
)
 
$
380

 
$
(499
)
 
$
(879
)
   Net income/(loss)
(771
)
 
(717
)
 
54

 
(1,388
)
 
(1,278
)
 
110

   Ending balance
$
(1,779
)
 
$
(2,494
)
 
$
(715
)
 
$
(1,008
)
 
$
(1,777
)
 
$
(769
)
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated other comprehensive income/(loss)
 
 
 
 
 
 
 
 
 
 
 
   Beginning balance
$
(628
)
 
$
141

 
$
769

 
$
(1,118
)
 
$
(239
)
 
$
879

   Other comprehensive income/(loss)
(437
)
 
(491
)
 
(54
)
 
490

 
380

 
(110
)
   Ending balance
$
(1,065
)
 
$
(350
)
 
$
715

 
$
(628
)
 
$
141

 
$
769

Consolidated Statements of Cash Flows
 
2014
 
2013
($ in millions)
Previously Reported
 
As Adjusted
 
Effect of Change
 
Previously Reported
 
As Adjusted
 
Effect of Change
Cash flows from operating activities:
 
 
 
 

 
 
 
 
 

Net income/(loss)
$
(771
)
 
$
(717
)
 
$
54

 
$
(1,388
)
 
$
(1,278
)
 
$
110

Benefit plans
(24
)
 
(78
)
 
(54
)
 
70

 
(108
)
 
(178
)
Other comprehensive income tax benefits

 

 

 
(303
)
 
(250
)
 
53

Deferred taxes
$
3

 
$
3

 
$

 
$
(164
)
 
$
(149
)
 
$
15