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Basis of Presentation (Notes) | 6 Months Ended
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Jul. 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 six months of fiscal 2018 and fiscal 2017 included 26 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 July 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. The primary impacts we have identified thus far are:
• | Minor changes to the timing of recognition of revenues related to gift cards and loyalty programs;
• | Changes to certain immaterial revenues that are currently reported on a gross basis, to be reported on a net basis (with no change in timing of recognition) with consequently no impacts to earnings; and
• | The balance sheet presentation of our sales returns reserve, which will be shown as a separate asset and liability versus the current net presentation.
In addition, we expect adoption to lead to increased footnote disclosures, particularly with regard to revenue related balance sheet accounts and revenue by channel and category. We also expect the adoption and consequent changes to our procedures and methodologies to require adjustments to our internal controls over financial reporting. As interpretations of the new rules continue to evolve, we will continue to monitor developments and expect to finalize our conclusions in the fourth quarter of fiscal 2018. 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 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. Excess tax benefits and tax deficiencies are now recognized in our provision for income taxes as a discrete event rather than as a component of stockholders’ equity. In addition, we elected to account for forfeitures as they occur. The cumulative effect of this policy change amounted to $12 million, net of tax, and was recorded as a reduction to our retained earnings opening balance. Finally, we elected to present the Condensed Consolidated 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.
• | 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. The retrospective adoption increased our beginning and ending cash balance within our statement of cash flows. 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 July 30, 2016:
| July 30, 2016 Reported |  | ASU 2016-09 Adjustment |  | ASU 2016-15 Adjustment |  | ASU 2016-18 Adjustment |  | July 30, 2016 Adjusted
Operating activities |  |  |  |  |  |  |  |  |
Other, net | $ | (38 | ) |  | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | (29 | )
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |  |
Receivables | 240 |  |  | — |  |  | (1 | ) |  | — |  |  | 239 |
Merchandise inventories | 160 |  |  | — |  |  | 1 |  |  | — |  |  | 161 |
Total cash provided by operating activities | 1,288 |  |  | 9 |  |  | — |  |  | — |  |  | 1,297 |
Investing activities |  |  |  |  |  |  |  |  |
Change in restricted assets | (4 | ) |  | — |  |  | — |  |  | 4 |  |  | — |
Total cash used in investing activities | (495 | ) |  | — |  |  | — |  |  | 4 |  |  | (491 | )
Financing activities |  |  |  |  |  |  |  |  |
Other, net | 17 |  |  | (9 | ) |  | — |  |  | — |  |  | 8 |
Total cash used in financing activities | (933 | ) |  | (9 | ) |  | — |  |  | — |  |  | (942 | )
Decrease in cash, cash equivalents and restricted cash | (115 | ) |  | — |  |  | — |  |  | 4 |  |  | (111 | )
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 | $ | 1,861 |  |  | $ | — |  |  | $ | — |  |  | $ | 189 |  |  | $ | 2,050 |
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:
| July 29, 2017 |  | January 28, 2017 |  | July 30, 2016
Cash and cash equivalents | $ | 1,365 |  |  | $ | 2,240 |  |  | $ | 1,861 |
Restricted cash included in Other current assets | 196 |  |  | 193 |  |  | 189 |
Total cash, cash equivalents and restricted cash | $ | 1,561 |  |  | $ | 2,433 |  |  | $ | 2,050 |
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 205 -URI http://asc.fasb.org/topic&trid=2122149 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -URI http://asc.fasb.org/topic&trid=2197479 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 275 -URI http://asc.fasb.org/topic&trid=2134479 + Details
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