Fair Value Measurements

6 Months Ended

Aug. 02, 2014

Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).



Fair Value Measurements - Recurring Basis
	Fair Value at						Fair Value at						Fair Value at
	August 2, 2014						February 1, 2014						August 3, 2013
(millions)	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Cash and cash equivalents
Short-term investments	$	3	$	—	$	—	$	3	$	—	$	—	$	249	$	—	$	—
Other current assets
Interest rate swaps^(a)	—		—		—		—		1		—		—		—		—
Prepaid forward contracts	40		—		—		73		—		—		73		—		—
Beneficial interest asset^(b)	—		—		56		—		—		71		—		—		91
Other noncurrent assets
Interest rate swaps^(a)	—		51		—		—		62		—		—		74		—
Company-owned life insurance investments^(c)	—		314		—		—		305		—		—		297		—
Beneficial interest asset^(b)	—		—		41		—		—		56		—		—		89
Total	$	43	$	365	$	98	$	76	$	368	$	127	$	322	$	371	$	180
Liabilities
Other noncurrent liabilities
Interest rate swaps^(a)	—		31		—		—		39		—		—		45		—
Total	$	—	$	31	$	—	$	—	$	39	$	—	$	—	$	45	$	—

^(a) See Note 7 for additional information on interest rate swaps.

^(b) Note 3 includes a rollforward of the Level 3 beneficial interest asset. A one percentage point change in the forecasted credit EBIT yield would impact our fair value estimate by approximately $14 million. A one percentage point change in the forecasted discount rate would impact our fair value estimate by approximately $3 million.

^(c) Company-owned life insurance investments consist of equity index funds and fixed income assets. Amounts are presented net of nonrecourse loans that are secured by some of these policies. These loan amounts totaled $806 million at August 2, 2014, $790 million at February 1, 2014 and $787 million at August 3, 2013.



Significant Financial Instruments not Measured at Fair Value ^(a) (millions)	August 2, 2014				February 1, 2014				August 3, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value
Debt ^(b)	$	12,135	$	13,553	$	11,758	$	13,184	$	12,484	$	14,018

^(a) The carrying amounts of accounts payable and certain accrued and other current liabilities approximate fair value due to their short-term nature.

^(b)The carrying amount and estimated fair value of debt exclude unamortized swap valuation adjustments and capital lease obligations.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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