SEC Info - Pepsico Inc - ‘10-K’ for 12/26/09

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Pepsico Inc – ‘10-K’ for 12/26/09 – ‘XML.R8’

On: Monday, 2/22/10, at 4:19pm ET · For: 12/26/09 · Accession #: 1193125-10-36385 · File #: 1-01183

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/22/10  Pepsico Inc                       10-K       12/26/09   40:6.7M                                   Donnelley … Solutions/FA

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   1.42M 
 3: EX-14       Worldwide Code of Conduct                           HTML     39K 
 4: EX-21       Subsidiaries of Pepsico, Inc.                       HTML    161K 
 5: EX-23       Consent of Kpmg LLP                                 HTML     24K 
 6: EX-24       Power of Attorney                                   HTML    107K 
 2: EX-12       Computaion of Ratio of Earnings to Fixed Charges    HTML     34K 
 7: EX-31       Certification of Our CEO and CFO Pursuant to        HTML     30K 
                Section 302                                                      
 8: EX-32       Certification of Our CEO and CFO Pursuant to        HTML     18K 
                Section 906                                                      
32: XML         IDEA XML File -- Definitions and References          XML    102K 
37: XML         IDEA XML File -- Filing Summary                      XML     68K 
35: XML.R1      Statement Of Income Alternative                      XML    153K 
36: XML.R2      Statement Of Cash Flows Indirect                     XML    427K 
22: XML.R3      Statement Of Financial Position Classified           XML    261K 
26: XML.R4      Statement Of Financial Position Classified           XML     57K 
                (Parenthetical)                                                  
30: XML.R5      Statement Of Shareholders Equity And Other           XML   1.74M 
                Comprehensive Income                                             
29: XML.R6      Statement Of Shareholders Equity And Other           XML     36K 
                Comprehensive Income (Parenthetical)                             
39: XML.R7      Basis of Presentation and Our Divisions              XML    148K 
18: XML.R8      Our Significant Accounting Policies                  XML     42K 
28: XML.R9      Restructuring and Impairment Charges                 XML     86K 
17: XML.R10     Property, Plant and Equipment and Intangible         XML    128K 
                Assets                                                           
16: XML.R11     Income Taxes                                         XML    118K 
21: XML.R12     Stock-Based Compensation                             XML     68K 
34: XML.R13     Pension, Retiree Medical and Savings Plans           XML    354K 
23: XML.R14     Noncontrolled Bottling Affiliates                    XML     69K 
24: XML.R15     Debt Obligations and Commitments                     XML     67K 
27: XML.R16     Financial Instruments                                XML    147K 
40: XML.R17     Net Income Attributable to PepsiCo per Common        XML     56K 
                Share                                                            
20: XML.R18     Preferred Stock                                      XML     39K 
15: XML.R19     Accumulated Other Comprehensive Loss Attributable    XML     39K 
                to PepsiCo                                                       
25: XML.R20     Supplemental Financial Information                   XML     77K 
33: XML.R21     Acquisition of Common Stock of PBG and PAS           XML     29K 
19: XML.R22     Document Information                                 XML     34K 
31: XML.R23     Entity Information                                   XML    102K 
38: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS    128K 
 9: EX-101.INS  XBRL Instance -- pep-20091226                        XML   1.42M 
11: EX-101.CAL  XBRL Calculations -- pep-20091226_cal                XML    150K 
12: EX-101.DEF  XBRL Definitions -- pep-20091226_def                 XML    333K 
13: EX-101.LAB  XBRL Labels -- pep-20091226_lab                      XML    367K 
14: EX-101.PRE  XBRL Presentations -- pep-20091226_pre               XML    401K 
10: EX-101.SCH  XBRL Schema -- pep-20091226                          XSD     63K

‘XML.R8’ — Our Significant Accounting Policies

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<div> Note 2 — Our Significant Accounting Policies Revenue Recognition We recognize revenue upon shipment or delivery to our customers based on written sales terms that do not allow for a right of return. However, our policy for DSD and certain chilled products is to remove and replace damaged and out-of-date products from store shelves to ensure that our consumers receive the product quality and freshness that they expect. Similarly, our policy for certain warehouse-distributed products is to replace damaged and out-of-date products. Based on our experience with this practice, we have reserved for anticipated damaged and out-of-date products. For additional unaudited information on our revenue recognition and related policies, including our policy on bad debts, see “Our Critical Accounting Policies” in Management’s Discussion and Analysis of Financial Condition and Results of Operations. We are exposed to concentration of credit risk by our customers, Wal-Mart and PBG. In 2009, Wal-Mart (including Sam’s) represented approximately 13% of our total net revenue, including concentrate sales to our bottlers which are used in finished goods sold by them to Wal-Mart; and PBG represented approximately 6%. We have not experienced credit issues with these customers. Sales Incentives and Other Marketplace Spending We offer sales incentives and discounts through various programs to our customers and consumers. Sales incentives and discounts are accounted for as a reduction of revenue and totaled $12.9 billion in 2009, $12.5 billion in 2008 and $11.3 billion in 2007. While most of these incentive arrangements have terms of no more than one year, certain arrangements, such as fountain pouring rights, may extend beyond one year. Costs incurred to obtain these arrangements are recognized over the shorter of the economic or contractual life, as a reduction of revenue, and the remaining balances of $296 million as of December 26, 2009 and $333 million as of December 27, 2008 are included in current assets and other assets on our balance sheet. For additional unaudited information on our sales incentives, see “Our Critical Accounting Policies” in Management’s Discussion and Analysis of Financial Condition and Results of Operations. Other marketplace spending, which includes the costs of advertising and other marketing activities, totaled $2.8 billion in 2009 and $2.9 billion in both 2008 and 2007 and is reported as selling, general and administrative expenses. Included in these amounts were advertising expenses of $1.7 billion in both 2009 and 2008 and $1.8 billion in 2007. Deferred advertising costs are not expensed until the year first used and consist of: <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> media and personal service prepayments, </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> promotional materials in inventory, and </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> production costs of future media advertising. </td> </tr> </table> Deferred advertising costs of $143 million and $172 million at year-end 2009 and 2008, respectively, are classified as prepaid expenses on our balance sheet. Distribution Costs Distribution costs, including the costs of shipping and handling activities, are reported as selling, general and administrative expenses. Shipping and handling expenses were $5.6 billion in both 2009 and 2008 and $5.2 billion in 2007. Cash Equivalents Cash equivalents are investments with original maturities of three months or less which we do not intend to rollover beyond three months. Software Costs We capitalize certain computer software and software development costs incurred in connection with developing or obtaining computer software for internal use when both the preliminary project stage is completed and it is probable that the software will be used as intended. Capitalized software costs include only (i) external direct costs of materials and services utilized in developing or obtaining computer software, (ii) compensation and related benefits for employees who are directly associated with the software project and (iii) interest costs incurred while developing internal-use computer software. Capitalized software costs are included in property, plant and equipment on our balance sheet and amortized on a straight-line basis when placed into service over the estimated useful lives of the software, which approximate five to ten years. Software amortization totaled $119 million in 2009, $58 million in 2008 and $30 million in 2007. Net capitalized software and development costs were $1.1 billion as of December 26, 2009 and $940 million as of December 27, 2008. Commitments and Contingencies We are subject to various claims and contingencies related to lawsuits, certain taxes and environmental matters, as well as commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. For additional information on our commitments, see Note 9. Research and Development We engage in a variety of research and development activities. These activities principally involve the development of new products, improvement in the quality of existing products, improvement and modernization of production processes, and the development and implementation of new technologies to enhance the quality and value of both current and proposed product lines. Consumer research is excluded from research and development costs and included in other marketing costs. Research and development costs were $414 million in 2009, $388 million in 2008 and $364 million in 2007 and are reported within selling, general and administrative expenses. Other Significant Accounting Policies Our other significant accounting policies are disclosed as follows: <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Property, Plant and Equipment and Intangible Assets – Note 4, and for additional unaudited information on brands and goodwill, see “Our Critical Accounting Policies” in Management’s Discussion and Analysis of Financial Condition and Results of Operations. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Income Taxes – Note 5, and for additional unaudited information, see “Our Critical Accounting Policies” in Management’s Discussion and Analysis of Financial Condition and Results of Operations. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Stock-Based Compensation – Note 6. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Pension, Retiree Medical and Savings Plans – Note 7, and for additional unaudited information, see “Our Critical Accounting Policies” in Management’s Discussion and Analysis of Financial Condition and Results of Operations. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Financial Instruments – Note 10, and for additional unaudited information, see “Our Business Risks” in Management’s Discussion and Analysis of Financial Condition and Results of Operations. </td> </tr> </table> Recent Accounting Pronouncements In December 2007, the FASB amended its guidance on accounting for business combinations to improve, simplify and converge internationally the accounting for business combinations. The new accounting guidance continues the movement toward the greater use of fair value in financial reporting and increased transparency through expanded disclosures. We adopted the provisions of the new guidance as of the beginning of our 2009 fiscal year. The new accounting guidance changes how business acquisitions are accounted for and will impact financial statements both on the acquisition date and in subsequent periods. Additionally, under the new guidance, transaction costs are expensed rather than capitalized. Future adjustments made to valuation allowances on deferred taxes and acquired tax contingencies associated with acquisitions that closed prior to the beginning of our 2009 fiscal year apply the new provisions and will be evaluated based on the outcome of these matters. In December 2007, the FASB issued new accounting and disclosure guidance on noncontrolling interests in consolidated financial statements. This guidance amends the accounting literature to establish new standards that will govern the accounting for and reporting of (1) noncontrolling interests in partially owned consolidated subsidiaries and (2) the loss of control of subsidiaries. We adopted the accounting provisions of the new guidance on a prospective basis as of the beginning of our 2009 fiscal year, and the adoption did not have a material impact on our financial statements. In addition, we adopted the presentation and disclosure requirements of the new guidance on a retrospective basis in the first quarter of 2009. In June 2009, the FASB amended its accounting guidance on the consolidation of VIEs. Among other things, the new guidance requires a qualitative rather than a quantitative assessment to determine the primary beneficiary of a VIE based on whether the entity (1) has the power to direct matters that most significantly impact the activities of the VIE and (2) has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. In addition, the amended guidance requires an ongoing reconsideration of the primary beneficiary. The provisions of this new guidance are effective as of the beginning of our 2010 fiscal year, and we do not expect the adoption to have a material impact on our financial statements. </div>

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4 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 8/30/10  SEC                               UPLOAD¶    10/11/17    1:59K  Pepsico Inc.
 6/25/10  SEC                               UPLOAD¶    10/11/17    1:65K  Pepsico Inc.
 5/03/10  SEC                               UPLOAD¶    10/11/17    1:72K  Pepsico Inc.
 4/09/10  SEC                               UPLOAD¶    10/11/17    1:87K  Pepsico Inc.

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Filing Submission 0001193125-10-036385 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Pepsico Inc – ‘10-K’ for 12/26/09 – ‘XML.R8’

On: Monday, 2/22/10, at 4:19pm ET · For: 12/26/09 · Accession #: 1193125-10-36385 · File #: 1-01183

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34Filing Table of Contents

‘XML.R8’ — Our Significant Accounting Policies

This Financial Report is an XBRL XML File.

4 Subsequent Filings that Reference this Filing

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents