Summary of Significant Accounting Policies (Tables)

3 Months Ended

Jun. 29, 2019

Schedule of Components of Calculation of Basic Net Income Per Ordinary Share and Diluted Net Income Per Ordinary Share

The components of the calculation of basic net income per ordinary share and diluted net income per ordinary share are as follows (in millions, except share and per share data):



	Three Months Ended
	June 29, 2019		June 30, 2018
Numerator:
Net income attributable to Capri	$	45	$	186
Denominator:
Basic weighted average shares	151,049,572		149,502,101
Weighted average dilutive share equivalents:
Share options and restricted shares/units, and performance restricted share units	1,284,581		2,897,554
Diluted weighted average shares	152,334,153		152,399,655

Basic net income per share ⁽¹⁾	$	0.30	$	1.25
Diluted net income per share ⁽¹⁾	$	0.30	$	1.22

⁽¹⁾

Basic and diluted net income per share are calculated using unrounded numbers.

Schedule of Impact of Adoption of New Accounting Pronouncements

The below table details the balance sheet adjustments recorded on March 31, 2019 in connection with the Company’s adoption of ASU 2016-02 (in millions):



	March 30, 2019 As Reported under ASC 840		ASC 842 Adjustments				March 31, 2019 As Reported Under ASC 842
Assets
Prepaid expenses and other current assets	$	221	$	(23	)	⁽¹⁾	$	198
Operating lease right-of-use assets	—		1,856			⁽²⁾	1,856
Intangible assets, net	2,293		(20		)	⁽³⁾	2,273
Deferred tax assets	112		38			⁽⁴⁾	150
Liabilities
Current portion of operating lease liabilities	—		386			⁽⁵⁾	386
Accrued expenses and other current liabilities	374		(72		)	⁽⁶⁾	302
Long-term portion of operating lease liabilities	—		1,828			⁽⁵⁾	1,828
Deferred Rent	132		(132		)	⁽⁷⁾	—
Deferred tax liabilities	438		(7		)	⁽⁴⁾	431
Shareholders’ Equity
Retained earnings	4,707		(152		)	⁽⁴⁾	4,555


⁽¹⁾	Represents the reclassification of rent paid in advance to current operating lease liabilities.


⁽²⁾	Represents the recognition of operating lease right-of-use assets, reflecting the reclassifications of deferred rent, sublease liabilities, tenant allowances and favorable and unfavorable lease rights. This balance also reflects the initial impairments of the right-of-use assets recorded through retained earnings, as described below.


⁽³⁾	Represents the reclassifications favorable and unfavorable purchase accounting adjustments for leases recorded in conjunction with the Company’s acquisitions to operating lease right-of-use assets.


⁽⁴⁾	Represents the initial impairment recognized through retained earnings for certain underperforming retail store locations for which fixed assets were previously impaired, net of associated deferred taxes.


⁽⁵⁾	Represents the recognition of current and non-current lease liabilities for fixed payments associated with the Company’s operating leases.


⁽⁶⁾	Represents the reclassification of $54 million in sublease liabilities, primarily related to Michael Kors retail stores closed under the Company’s Retail Fleet Optimization Plan as described in Note 10, as well as the reclassification of $18 million of deferred rent and tenant allowances to operating lease right-of-use assets.

⁽⁷⁾

Represents the reclassification of noncurrent deferred rent and tenant improvement allowances to operating lease right-of-use assets.