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Basis of Presentation (Notes) | 3 Months Ended
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Apr. 29, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Basis of Presentation | Basis of Presentation Unless the context otherwise requires, the use of the terms “Best Buy,” “we,” “us” and “our” in these Notes to Condensed Consolidated Financial Statements refers to Best Buy Co., Inc. and its consolidated subsidiaries. In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments necessary for a fair presentation as prescribed by accounting principles generally accepted in the United States (“GAAP”). All adjustments were comprised of normal recurring adjustments, except as noted in these Notes to Condensed Consolidated Financial Statements. Historically, we have generated a higher proportion of our revenue and earnings in the fiscal fourth quarter, which includes the majority of the holiday shopping season in the U.S., Canada and Mexico. Due to the seasonal nature of our business, interim results are not necessarily indicative of results for the entire fiscal year. The interim financial statements and the related notes in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended January 28, 2017. The first three months of fiscal 2018 and fiscal 2017 included 13 weeks. In order to align our fiscal reporting periods and comply with statutory filing requirements, we consolidate the financial results of our Mexico operations on a one-month lag. Our policy is to accelerate recording the effect of events occurring in the lag period that significantly affect our condensed consolidated financial statements. No such events were identified for the reported periods. In preparing the accompanying condensed consolidated financial statements, we evaluated the period from April 30, 2017, through the date the financial statements were issued, for material subsequent events requiring recognition or disclosure. No such events were identified for this period. Unadopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers. The new guidance establishes a single comprehensive model for entities to use in accounting for revenue and supersedes most current revenue recognition guidance. It introduces a five-step process for revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards under current guidance. It also requires significantly expanded disclosures regarding revenues. Based on our analysis thus far, we believe the impact of adopting the new guidance will be immaterial to our annual and interim financial statements. We believe that the impact will be limited to minor changes to the timing of recognition of revenues related to gift cards and loyalty programs. We continue to assess the impact on all areas of our revenue recognition, disclosure requirements and changes that may be necessary to our internal controls over financial reporting. We plan to adopt this standard in the first quarter of our fiscal 2019. Providing we ultimately conclude that the impacts of adoption are immaterial, we would expect to use the modified retrospective method. Under this method, we would recognize the cumulative effect of the changes in retained earnings at the date of adoption, but would not restate prior periods. In February 2016, the FASB issued ASU 2016-02, Leases. The new guidance was issued to increase transparency and comparability among companies by requiring most leases to be included on the balance sheet and by expanding disclosure requirements. Based on the effective dates, we expect to adopt the new guidance in the first quarter of fiscal 2020 using the modified retrospective method. While we expect adoption to lead to a material increase in the assets and liabilities recorded on our balance sheet and increase our footnote disclosures related to leases, we are still evaluating the impact on our consolidated statement of earnings. We also expect that adoption of the new standard will require changes to our internal controls over financial reporting. Adopted Accounting Pronouncements In the first quarter of fiscal 2018, we adopted the following ASUs:
• | ASU 2015-11, Inventory: Simplifying the Measurement of Inventory. The new guidance replaces the current inventory measurement requirement of lower of cost or market with the lower of cost or net realizable value. The adoption did not have a material impact on our results of operations, cash flows or financial position.
• | ASU 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting. The new guidance changed certain aspects of accounting for share-based payments including accounting for income taxes, forfeitures and classifications in the statement of cash flows. Beginning with the first quarter of fiscal 2018, excess tax benefits and tax deficiencies are recognized in our provision for income taxes as a discrete event rather than directly to stockholders’ equity. This change is adopted prospectively, with no change to prior periods. We recognized an excess tax benefit of $2 million for the first quarter ended April 29, 2017. In addition, with the adoption of this standard we elected to change our policy for accounting for forfeitures. Previously, we recorded forfeitures (which reduce stock-based compensation expense) based on forward-looking estimates. Beginning this quarter, we have elected to record forfeitures as they occur. The cumulative effect of this policy change amounted to $12 million, net of tax. This was recorded as a reduction of opening retained earnings. We elected to present the statements of cash flows on a retrospective transition method, and prior periods have been adjusted to present excess tax benefits as cash flows from operating activities. See cash flow reconciliation below for prior period impacts.
• | ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, and ASU 2016-18, Statement of Cash Flows: Restricted Cash. ASU 2016-15 provides classification requirements for specific transactions within the statement of cash flows, while ASU 2016-18 requires that restricted cash balances be included in the beginning and ending cash balance within the statement of cash flows. The adoption increased our beginning and ending cash balance within our statement of cash flows, and we have provided a reconciliation of these amounts to the corresponding balance sheet captions, below. The adoption had no other material impacts to our cash flow statement and had no impact on our results of operations or financial position.
The following table reconciles the Condensed Consolidated Statement of Cash Flows line items impacted by the adoption of these standards at April 29, 2017:
|  | April 30, 2016 Reported |  | ASU 2016-09 Adjustment |  | ASU 2016-15 Adjustment |  | ASU 2016-18 Adjustment |  | April 30, 2016 Adjusted
Operating activities |  |  |  |  |  |  |  |  |  |
Other, net |  | $ | (12 | ) |  | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | (3 | )
Total cash provided by operating activities |  | 483 |  |  | 9 |  |  | — |  |  | — |  |  | 492 |
Investing activities |  |  |  |  |  |  |  |  |  |
Change in restricted assets |  | (2 | ) |  | — |  |  | — |  |  | 2 |  |  | — |
Total cash used in investing activities |  | (42 | ) |  | — |  |  | — |  |  | 2 |  |  | (40 | )
Financing activities |  |  |  |  |  |  |  |  |  |
Other, net |  | 19 |  |  | (9 | ) |  | — |  |  | — |  |  | 10 |
Total cash used in financing activities |  | (612 | ) |  | (9 | ) |  | — |  |  | — |  |  | (621 | )
Decrease in cash, cash equivalents and restricted cash |  | (131 | ) |  | — |  |  | — |  |  | 2 |  |  | (129 | )
Cash, cash equivalents and restricted cash at beginning of period |  | 1,976 |  |  | — |  |  | — |  |  | 185 |  |  | 2,161 |
Cash, cash equivalents and restricted cash at end of period |  | $ | 1,845 |  |  | $ | — |  |  | $ | — |  |  | $ | 187 |  |  | $ | 2,032 |
Total Cash, Cash Equivalents and Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Condensed Consolidated Balance Sheet to the total shown in the Condensed Consolidated Statement of Cash Flows:
| April 29, 2017 |  | January 28, 2017 |  | April 30, 2016
Cash and cash equivalents | $ | 1,651 |  |  | $ | 2,240 |  |  | $ | 1,845 |
Restricted cash included in Other current assets | 183 |  |  | 193 |  |  | 187 |
Total cash, cash equivalents and restricted cash | $ | 1,834 |  |  | $ | 2,433 |  |  | $ | 2,032 |
Amounts included in restricted cash are pledged as collateral or restricted to use for general liability insurance and workers' compensation insurance.

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- Definition The entire disclosure for the organization, consolidation and basis of presentation of financial statements disclosure, and significant accounting policies of the reporting entity. May be provided in more than one note to the financial statements, as long as users are provided with an understanding of (1) the significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement with a VIE, (2) the nature of restrictions on a consolidated VIE's assets reported by an enterprise in its statement of financial position, including the carrying amounts of such assets, (3) the nature of, and changes in, the risks associated with an enterprise's involvement with the VIE, and (4) how an enterprise's involvement with the VIE affects the enterprise's financial position, financial performance, and cash flows. Describes procedure if disclosures are provided in more than one note to the financial statements. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 275 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=64851502&loc=d3e6003-108592 + Details
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