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| Title | Marriott Corporation, 1984 Annual Report |
| Creator (LCNAF) |
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| Publisher | Marriott International, Inc. |
| Date | 1984 |
| Description | Marriott Corporation Annual Report for calendar year 1984. |
| Subject.Topical (LCSH) |
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| Subject.Name (LCNAF) |
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| Genre (AAT) |
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| Language | English |
| Type (DCMI) |
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| 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 |
| Title | Image 31 |
| Format (IMT) |
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| File Name | hiltonar_201609_056_031.jpg |
| Transcript | NOTES TO F SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The financial statements include the accounts of Marriott Corporation, its subsidiaries and other majority- owned affiliates, except Marriott Financial Services, Inc., a wholly owned finance subsidiary. The investment in the finance subsidiary, and investments in less than 50%-owned affiliates over which the company has the ability to exercise significant influence, are accounted for using the equity method. All material intercompany transactions and balances have been eliminated. Fiscal Year The company's fiscal year ends on the Friday closest to December 31 for domestic operations and on November 30 for foreign operations. Managed and Leased Hotel Operations The company operates 91 hotels under management and lease agreements whereby payments to owners are based primarily on hotel profits. Sales, expenses and operating working capital of managed and leased hotels operated with the company's employees are included in the accompanying financial statements. Payments to owners are included in rent expense. Foreign Operations The financial statements include: net assets of foreign subsidiaries and affiliates of $78.8 million at December 28,1984 and $76.2 million at December 30,1983; sales of $198.1 million in 1984, $181.8 million in 1983 and $148.1 million in 1982; and income before income taxes of $23.7 million in 1984, $21.3 million in 1983 and $10.8 million in 1982. Property and Equipment Costs incurred in developing real estate, including interest, rent and real estate taxes during the construction period, are capitalized. Capitalized interest totaled $72.1 million in 1984, $38.1 million in 1983 and $32.8 million in 1982. Replacements and improvements, including most costs of converting units, are capitalized. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the asset life or lease term. Upon sale or retirement of property and equipment, the costs less accumulated depreciation and salvage are charged or credited to income. Assets Held for Sale When management commits to a formal plan to dispose of property and equipment, the net book value of the assets is reclassified to Assets Held for Sale, any anticipated disposition losses are accrued and depreciation is discontinued. Cost in Excess of Net Assets of Businesses Acquired The cost in excess of net assets of businesses acquired prior to October 31,1970 (at which time amortization became mandatory) of $11.8 million is not being amortized because, in management's judgment, it has continuing value. The remaining $14.9 million at December 28, 1984 is being amortized over periods of up to 40 years. Pre-Opening Costs Costs of an operating nature incurred prior to opening are deferred and amortized over three years for hotels and one year for other major operations. Similar costs for all other operations are expensed as incurred. Profit Sharing Plan The company contributes to a profit sharing plan for the benefit of employees meeting certain eligibility requirements and electing participation in the plan. Company contributions are a specified percentage of the company's pre-tax income as defined by the plan and were $22.3 million in 1984, $18 million in 1983 and $12 million in 1982. Income Taxes The provision for income taxes is based on income recognized for financial reporting purposes and includes the effect of timing differences between such income and that recognized for tax purposes, principally depreciation, interest and partnership interests. Investment tax credits are accounted for using the "flow-through" method. No provision for income taxes has been made on the unremitted earnings of foreign subsidiaries ($37.7 million as of December 28,1984) because management considers these earnings to be permanendy invested. Earnings Per Share Primary and fully diluted earnings per share are based on the weighted average number of shares outstanding during each year, adjusted for the dilutive effect of employee stock option and purchase plans and deferred stock compensation. Primary and fully diluted shares for 1984 were 26,961,269 and 26,989,636, respectively. Discretionary Cash Flow Discretionary Cash Flow represents funds provided from operations less capital expenditures that, in management's opinion, were required to maintain the competitive position of existing property and equipment 29 |