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Marriott Corporation, 1972 Annual Report
Image 30
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Marriott International, Inc.. Marriott Corporation, 1972 Annual Report - Image 30. 1972. Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston. University of Houston Digital Library. Web. February 26, 2020. https://digital.lib.uh.edu/collection/hiltonar/item/1171/show/1164.

Disclaimer: This is a general citation for reference purposes. Please consult the most recent edition of your style manual for the proper formatting of the type of source you are citing. If the date given in the citation does not match the date on the digital item, use the more accurate date below the digital item.

Marriott International, Inc.. (1972). Marriott Corporation, 1972 Annual Report - Image 30. Annual Reports from the Hospitality Industry Archives. Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston. Retrieved from https://digital.lib.uh.edu/collection/hiltonar/item/1171/show/1164

Disclaimer: This is a general citation for reference purposes. Please consult the most recent edition of your style manual for the proper formatting of the type of source you are citing. If the date given in the citation does not match the date on the digital item, use the more accurate date below the digital item.

Marriott International, Inc., Marriott Corporation, 1972 Annual Report - Image 30, 1972, Annual Reports from the Hospitality Industry Archives, Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston, accessed February 26, 2020, https://digital.lib.uh.edu/collection/hiltonar/item/1171/show/1164.

Disclaimer: This is a general citation for reference purposes. Please consult the most recent edition of your style manual for the proper formatting of the type of source you are citing. If the date given in the citation does not match the date on the digital item, use the more accurate date below the digital item.

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Compound Item Description
Title Marriott Corporation, 1972 Annual Report
Creator (LCNAF)
  • Marriott International, Inc.
Publisher Marriott International, Inc.
Date 1972
Description Marriott Corporation Annual Report for the 52 weeks ending on July 28, 1972.
Subject.Topical (LCSH)
  • Hospitality industry
  • Hotel management
  • Corporation reports
Subject.Name (LCNAF)
  • Marriott International, Inc.
Genre (AAT)
  • annual reports
  • business records
Language English
Type (DCMI)
  • Text
  • Image
Original Item Location Marriott Hotels Collection
Digital Collection Annual Reports from the Hospitality Industry Archives
Digital Collection URL http://digital.lib.uh.edu/collection/hiltonar
Repository Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston
Repository URL http://www.uh.edu/hilton-college/About/hospitality-industry-archives
Use and Reproduction No Copyright - United States
File Name index.cpd
Item Description
Title Image 30
Format (IMT)
  • image/jpeg
File Name hiltonar_201609_043_030.jpg
Transcript Notes to Consolidated Financial Statements 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Principles of Consolidation: The accompanying consolidated financial statements include accounts of the Company and all majority-owned domestic and foreign subsidiaries. All material intercompany transactions have been eliminated. Acquisitions and 1971 Restatements: The 1971 financial statements have been restated to include (a) a previously unconsolidated wholly-owned finance subsidiary which merged with the Company in 1972; (b) Farrell's, Inc. which was acquired by the Company in June, 1972, in a transaction accounted for as a pooling of interests; and (c) consistent classifications of accounts. The net effect of these restatements was to increase sales and net income as originally reported in 1971 by $4,582,150 and $69,784. There was no effect on earnings per share. During 1972, the Company acquired three food service companies (including Farrell's, Inc.) for 264,850 shares of common stock. These combinations were accounted for as poolings of interests. The three companies had combined sales of $12,127,000 and net income of $501,000 for 1972 and total assets of $5,520,000 at dates of acquisition. During 1972, the Company acquired a cruise ship company, a 45% interest in another cruise ship company and a restaurant chain for $16,580,000. These acquisitions were accounted for as purchases with a resulting cost in excess of net assets of $3,955,000. The results of operations of these companies are included from the dates of acquisition and include sales of $4,493,000 and net income of $548,000. Proforma results of operations prior to the dates of acquisition, as required by Accounting Principles Board Opinion 16, are not available for the cruise ship companies since the acquisition included the reorganization of two privately owned companies and the purchase of individual assets from a third company. Results for the restaurant chain are not significant. Foreign Operations: The accompanying financial statements include net assets in foreign countries of $11,326,000 at July 28, 1972. Foreign sales and operating income for the year then ended, as a percent of total sales and profits, were 8.8% and 12.9%. Foreign assets and liabilities have been translated to U. S. dollars at year-end exchange rates, except net properties have been translated at rates prevailing when acquired. The income accounts have been translated at aDproximately the average monthly exchange rates. The effect on net income of gains and losses from translations and exchange transactions was not significant. Investment in Duman Investments, Inc.: The Company has a 25% equity interest (with 50% voting rights) in Duman Investments, Inc., the landlord of the New Orleans Marriott Hotel, which is leased to the Company and opened in late July 1972. In addition, the Company has a right to convert $1,000,000 of debentures for an additional 24% non-voting equity interest. At July 28. 1972, Duman had total assets of $30,674,000 and total liabilities of $27,993,000, of which $23,729,000 are current 28 liabilities. Duman has a $23,000,000 permanent mortgage loan commitment scheduled for closing in October, 1972. The Company has guaranteed $3,264,000 of Duman's long-term borrowings. Construction Financing: Interest of $1,612,000 in 1972 and $1,273,000 in 1971 on construction financing was capitalized as part of the construction costs. See Note 3 for description of accounting for construction financing. Depreciation and Amortization: Depreciation and amortization are calculated on the straight-line method for financial statement purposes and, where permitted, on accelerated methods for tax purposes. The following lives are used for financial statement purposes: Buildings and Improvements 20 to 40 Years Leasehold Improvements Shorter of Life of Lease or Asset Furniture and Equipment 2 to 20 Years Cruise Ships 20 Years Leasehold interest under lease- purchase obligations: Equipment 4 to 20 Years Buildings and Improvements ... 25 to 45 Years Income Taxes: Deferred income taxes are recognized for differences between book and tax accounting for depreciation, interest during construction, pre-opening expenses, payments to individuals for covenants not to compete obtained in connection with acquisitions, and deferred stock compensation. U. S. taxes are not accrued on undistributed earnings of foreign subsidiaries where management considers such earnings to be permanently invested. The Company uses the flow through method of accounting for investment tax credits. Deferred Management Stock Compensation: Compensation for deferred stock bonus awards is recorded in the year in which the bonus is earned, adjusted for anticipated forfeitures, and is based on the market price at the date awarded. Compensation for deferred stock contracts is recorded for the shares contingently vested in each year and is based on the market price as of the date of contracts. Other stock compensation which is subject to restrictions is expensed over the period of the restrictions. Computation of Earnings per Share: Earnings per share of common stock are based on the weighted average number of shares of common stock outstanding during each year, which were 28,656,595 for 1972 and 27,156,260 for 1971 (adjusted for 1972 stock split). Conversion of the outstanding subordinated debt and distribution of the total shares reserved under the stock purchase plan and awarded under deferred stock compensation agreements would not have a material effect on earnings per share. Cosf in Excess of Net Assets of Businesses Acquired: The cost in excess of net assets of businesses acquired prior to October 31, 1970 ($13,501,960), is not being amortized. The cost in excess of net assets of businesses acquired subsequent to October 31, 1970 ($4,370,612), is being amortized in accordance with Accounting Principles Board Opinion 17 over periods up to 40 years. Franchise Fees: Initial franchise fees and monthly royalty fees based on sales are accrued as earned. Deferred Charges: Deferred charges consist of the following: