Class Notes (835,299)
Canada (509,078)
ARBUS 102 (23)

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45 Pages
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Arts and Business
Seth Bouwers

Financial Results 41 Managements Statement of Responsibility for Financial Reporting 41 Independent Auditors Report 42 Consolidated Financial Statements 42 Consolidated Statements of Earnings 43 Consolidated Statements of Changes in Shareholders Equity 43 Consolidated Statements of Comprehensive Income 44 Consolidated Balance Sheets 45 Consolidated Cash Flow Statements 46 Notes to the Consolidated Financial Statements 46 Note 1. Summary of Significant Accounting Policies 52 Note 2. Implementation of New Accounting Standards 53 Note 3. Business Acquisitions and Dispositions 54 Note 4. Interest Expense and Other Financing Charges 54 Note 5. Income Taxes 55 Note 6. Basic and Diluted Net Earnings per Common Share 56 Note 7. Cash and Cash Equivalents 56 Note 8. Accounts Receivable 58 Note 9. Allowances for Receivables 58 Note 10. Inventories 58 Note 11. Fixed Assets 59 Note 12. Goodwill and Intangible Assets 59 Note 13. Other Assets 60 Note 14. Employee Future Benefits 64 Note 15. Short Term Debt 65 Note 16. Long Term Debt 66 Note 17. Other Liabilities 66 Note 18. Leases 67 Note 19. Preferred Shares and Capital Securities 68 Note 20. Common Share Capital 69 Note 21. Capital Management 71 Note 22. Stock-Based Compensation 74 Note 23. Accumulated Other Comprehensive Income 75 Note 24. Financial Derivative Instruments 76 Note 25. Fair Values of Financial Instruments 78 Note 26. Financial Instrument Risk Management 81 Note 27. Contingencies, Commitments and Guarantees 83 Note 28. Variable Interest Entities 83 Note 29. Related Party Transactions 84 Note 30. Other Information 85 Three Year Summary 86 Glossary of Terms 40 2009 Annual Report Financial Review Managements Statement of Responsibility for Financial Reporting The management of Loblaw Companies Limited is responsible forthe preparation, presentation and integrity of the accompanying consolidated financial statements, Managements Discussion and Analysis and all other information in the Annual Report. This responsibility includes the selection and consistent applicationof appropriate accounting principles and methods in addition to making the judgments and estimates necessary to prepare the consolidated financial statements in accordance with Canadian generally accepted accounting principles. It also includes ensuring thatthe financial information presented elsewhere in the Annual Report is consistent with that in the consolidated financial statements. Management is also responsible for establishing and maintainingadequate internal controls over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with Canadian GAAP. A dedicated control compliance teamreviews and evaluates internal controls, the results of which are shared with management on a quarterly basis. KPMG LLP, whose report follows, were appointed as independent auditors by a vote of the Companys shareholders to audit the consolidated financial statements. The Board of Directors, acting through an Audit Committee comprised solely of directors who are independent, is responsible for determining that management fulfills its responsibilities in thepreparation of the consolidated financial statements and the financial control of operations. The Audit Committee recommends the independent auditors for appointment by the shareholders. The Audit Committee meets regularly with senior and financial management,internal auditors and the independent auditors to discuss internal controls, auditing activities and financial reporting matters.The independent auditors and internal auditors have unrestrictedaccess to the Audit Committee. These consolidated financial statementsand Managements Discussion and Analysis have been approved by the Board of Directors for inclusion in the Annual Report based on the review and recommendation of the Audit Committee. Toronto, Canada March 12, 2010 [signed] [signed] [signed] Galen G. Weston Allan L. Leighton Robert G. Vaux Executive Chairman Deputy Chairman and President Chief Financial Officer Independent Auditors Report To the Shareholders of Loblaw Companies Limited: We have audited the consolidated balance sheets of Loblaw Companies Limited as at January 2, 2010 and January 3, 2009, the consolidated statements of earnings, changes in shareholders equity and comprehensive income and the consolidated cash flow statements for the 52 week and 53 week years ended January 2, 2010and January 3, 2009. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles usedand significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. In our opinion, these consolidated financial statements present fairly, in all material respects, the financial position of theCompany as at January 2, 2010 and January 3, 2009 and the results of its operationsand its cash flows for the years then ended in accordancewith Canadian generally accepted accounting principles. Toronto, Canada March 11, 2010 Chartered Accountants, Licensed Public Accountants 2009 Annual Report Financial Rev41w Consolidated Statements of Earnings (1) For the years ended January 2, 2010 and January 3, 2009 2009 2008 ($ millions except where otherwise indicated) (52 weeks) (53 weeks) Sales $ 30,735 $ 30,802 Cost of Merchandise Inventories Sold (note 10) 23,539 23,891 Gross Profit 7,196 6,911 Operating Expenses Selling and administrative expenses 5,402 5,309 Depreciation and amortization 589 550 5,991 5,859 Operating Income 1,205 1,052 Interest expense and other financing charge(note 4) 269 263 Earnings Before Income Taxes and Minority Interest 936 789 Income Taxes (note 5) 269 229 Net Earnings Before Minority Interest 667 560 Minority Interest 11 10 Net Earnings $ 656 $ 550 Net Earnings Per Common Share ($) (note 6) Basic $ 2.39 $ 2.01 Diluted $ 2.38 $ 2.01 See accompanying notes to the consolidated financial statements. (1) Restated - See note 2 to the Consolidated Financial Statements. 42 2009 Annual Report Financial Review Consolidated Statements of Changes in Shareholders Equity For the years ended January 2, 2010 and January 3, 2009 2009 2008 (1) ($ millions except where otherwise indicated) (52 weeks) (53 weeks) Common Share Capital, Beginning of Year $ 1,196 $ 1,196 Common shares issued (note 20) 120 Purchased for cancellation(note 20) (8) Common Share Capital, End of Year $ 1,308 $ 1,196 Retained Earnings, Beginning of Year
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