Black & Decker CYCLONE BLC12600BUC Manuel d'utilisateur télécharger pdf (Page 90)

The profitability measure employed by the Corporation and its chief operating decision maker for making decisions about allocating

resources to segments and assessing segment performance is segment profit (for the Corporation on a consolidated basis, operating

income before restructuring and exit costs). In general, segments follow the same accounting policies as those described in Note 1,

except with respect to foreign currency translation and except as further indicated below. The financial statements of a segment’s

operating units located outside of the United States, except those units operating in highly inflationary economies, are generally

measured using the local currency as the functional currency. For these units located outside of the United States, segment assets and

elements of segment profit are translated using budgeted rates of exchange. Budgeted rates of exchange are established annually and,

once established, all prior period segment data is restated to reflect the current year’s budgeted rates of exchange. The amounts

included in the preceding table under the captions “Reportable Business Segments” and “Corporate, Adjustments, & Eliminations” are

reflected at the Corporation’s budgeted rates of exchange for 2008. The amounts included in the preceding table under the caption

“Currency Translation Adjustments” represent the difference between consolidated amounts determined using those budgeted rates of

exchange and those determined based upon the rates of exchange applicable under accounting principles generally accepted in the

United States.

Segment profit excludes interest income and expense, non-operating income and expense, adjustments to eliminate intercompany

profit in inventory, and income tax expense. In addition, segment profit excludes merger-related expenses and restructuring and exit

costs. In determining segment profit, expenses relating to pension and other postretirement benefits are based solely upon estimated

service costs. Corporate expenses, as well as certain centrally managed expenses, including expenses related to share-based

compensation, are allocated to each reportable segment based upon budgeted amounts. While sales and transfers between segments

are accounted for at cost plus a reasonable profit, the effects of intersegment sales are excluded from the computation of segment

profit. Intercompany profit in inventory is excluded from segment assets and is recognized as a reduction of cost of goods sold by the

selling segment when the related inventory is sold to an unaffiliated customer. Because the Corporation compensates the management

of its various businesses on, among other factors, segment profit, the Corporation may elect to record certain segment-related expense

items of an unusual non-recurring nature in consolidation rather than reflect such items in segment profit. In addition, certain

segment-related items of income or expense may be recorded in consolidation in one period and transferred to the various segments in

a later period.

Segment assets exclude pension and tax assets, intercompany profit in inventory, intercompany receivables, and goodwill associated

with the Corporation’s acquisition of Emhart Corporation in 1989.

The reconciliation of segment profit to consolidated earnings before income taxes for each year, in millions of dollars, is as follows:

2009 2008 2007

Segment profit for total

reportable business segments $ 373.7 $ 499.2 $ 709.7

Items excluded from segment profit:

Adjustment of budgeted foreign

exchange rates to actual rates 13.5 29.4 (2.3)

Depreciation of Corporate property (1.5) (1.1) (1.4)

Adjustment to businesses’ postretirement

benefit expenses booked in consolidation (12.0) (3.6) (19.9)

Other adjustments booked in consolidation

directly related to reportable business segments (.3) (4.9) 8.3

Amounts allocated to businesses in arriving at

segment profit in excess of (less than) Corporate

center operating expenses, eliminations, and other

amounts identified above (53.3) (42.2) (93.2)

Operating income before merger-related expenses

and restructuring and exit costs 320.1 476.8 601.2

Merger-related expenses 58.8 — —

Restructuring and exit costs 11.9 54.7 19.0

Operating income 249.4 422.1 582.2

Interest expense, net of interest income 83.8 62.4 82.3

Other (income) expense (4.8) (5.0) 2.3

Earnings before income taxes $ 170.4 $ 364.7 $ 497.6

The reconciliation of segment assets to consolidated total assets at the end of each year, in millions of dollars, is as follows:

2009 2008 2007

Segment assets for total reportable

business segments $ 3,000.9 $ 3,497.4 $ 3,714.5

Items excluded from segment assets:

Adjustment of budgeted foreign

exchange rates to actual rates 85.9 (11.8) 135.5

Goodwill 636.6 633.8 640.5

Pension assets — 17.5 76.6

Source: BLACK & DECKER CORP, 10-K, February 19, 2010 Powered by Morningstar

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