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Organization and principal accounting policies (Policies)
6 Months Ended
Jul. 29, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of preparation
Basis of preparation
The condensed consolidated financial statements of Signet are prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with US generally accepted accounting principles (“US GAAP” or “GAAP”) have been condensed or omitted from this report, as is permitted by such rules and regulations. Intercompany transactions and balances have been eliminated in consolidation. Signet has reclassified certain prior year amounts to conform to the current year presentation. In the opinion of management, the accompanying condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the interim periods. The results for interim periods are not necessarily indicative of the results that may be expected for any other interim period. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in Signet’s Annual Report on Form 10-K for the fiscal year ended January 28, 2023 filed with the SEC on March 16, 2023.
Use of estimates
Use of estimates
The preparation of these condensed consolidated financial statements, in conformity with US GAAP and SEC regulations for interim reporting, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. Estimates and assumptions are primarily made in relation to the valuation of inventories, deferred revenue, employee compensation, income taxes, contingencies, leases, asset impairments for goodwill, indefinite-lived intangible and long-lived assets and the depreciation and amortization of long-lived assets.
Fiscal year
Fiscal year
The Company’s fiscal year ends on the Saturday nearest to January 31st. Fiscal 2024 and Fiscal 2023 refer to the 53-week period ending February 3, 2024 and the 52-week period ended January 28, 2023, respectively. Within these condensed consolidated financial statements, the second quarter and year-to-date period of the relevant fiscal years 2024 and 2023 refer to the 13 and 26 weeks ended July 29, 2023 and July 30, 2022, respectively.
Foreign currency translation
Foreign currency translation
The financial position and operating results of certain foreign operations, including certain subsidiaries operating in the UK as part of the International reportable segment and Canada as part of the North America reportable segment, are consolidated using the local currency as the functional currency. Assets and liabilities are translated at the rates of exchange on the condensed consolidated balance sheet dates, and revenues and expenses are translated at the monthly average rates of exchange during the period. Resulting translation gains or losses are included in the accompanying condensed consolidated statements of shareholders’ equity as a component of accumulated other comprehensive income (loss) (“AOCI”). Gains or losses resulting from foreign currency transactions are included within other operating expense within the condensed consolidated statements of operations.
See Note 9 for additional information regarding the Company’s foreign currency translation.
New accounting pronouncements recently adopted and New accounting pronouncements issued but not yet adopted
New accounting pronouncements recently adopted
In September 2022, the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs. This ASU was adopted by the Company as of January 29, 2023 and requires annual and interim disclosure of the key terms of outstanding supplier finance programs. In addition, this ASU requires disclosure of the related obligations outstanding at each interim reporting period and where those
obligations are presented on the balance sheet. This ASU also includes a prospective annual requirement to disclose a rollforward of the amount of the obligations during the annual reporting period. The new standard does not affect the recognition, measurement or financial statement presentation of the supplier finance program obligations. This ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, except for the amendment on rollforward information, which is effective for fiscal years beginning after December 15, 2023.
The Company entered into a supplier finance program during the second quarter of Fiscal 2024. Under this program, a financial intermediary acts as the Company’s paying agent with respect to accounts payable due to certain suppliers. The Company agrees to pay the financial intermediary the stated amount of the confirmed invoices from the designated suppliers on the original maturity dates of the invoices. The supplier finance program enables Company suppliers to be paid by the financial intermediary earlier than the due date on the applicable invoice. The Company negotiates payment terms directly with its suppliers for the purchase of goods and services. No guarantees or collateral are provided by the Company under the supplier finance program. As of July 29, 2023, the Company had no confirmed invoices outstanding under the supplier finance program. All activity related to the supplier finance program will be presented within operating activities on the condensed consolidated statements of cash flows.
New accounting pronouncements issued but not yet adopted
There are no new accounting pronouncements issued but not yet adopted that are expected to have a material impact on the Company’s financial position or results of operations in future periods.