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## Currency Translation and Transactions 

All assets and liabilities of foreign subsidiaries and affili- ates are translated at year-end rates of exchange, while revenue and expenses are translated at weighted average rates of exchange for the year. Unrealized translation gains or losses are reported as cumulative translation adjustments through other comprehensive income. Such adjustments amounted to $51.3 million, $46.0 million and $(38.0) million of unrealized translation gains (losses) in fiscal 2003, 2002 and 2001, respectively. 

The Company enters into forward foreign exchange contracts and foreign currency options to hedge foreign currency transactions for periods consistent with its iden- tified exposures. Accordingly, the Company categorizes these instruments as entered into for purposes other than trading. 

The accompanying consolidated statements of earn- ings include net exchange losses of $15.0 million and $6.8 million in fiscal 2003 and 2002, respectively, and net exchange gains of $9.2 million in fiscal 2001. 

## Inventory and Promotional Merchandise 

Inventory and promotional merchandise only includes inventory considered saleable or usable in future periods, and is stated at the lower of cost or fair-market value, with cost being determined on the first-in, first- out method. Promotional merchandise is charged to expense at the time the merchandise is shipped to the Company’s customers. 

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## Property, Plant and Equipment 

Property, plant and equipment is carried at cost less accumulated depreciation and amortization. For financial statement purposes, depreciation is provided principally on the straight-line method over the estimated useful lives of the assets ranging from 3 to 40 years. Leasehold improvements are amortized on a straight-line basis over the shorter of the lives of the respective leases or the expected useful lives of those improvements. 

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Depreciation and amortization of property, plant and equipment was $157.0 million, $140.5 million and $112.1 million in fiscal 2003, 2002 and 2001, respectively. 

## Goodwill and Other Intangible Assets 

Effective July 1, 2001, the Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 141, “Business Combinations” and SFAS No. 142, “Goodwill and Other Intangible Assets.” These statements estab- lished financial accounting and reporting standards for acquired goodwill and other intangible assets. Specifically, the standards address how acquired intangible assets should be accounted for both at the time of acquisition and after they have been recognized in the financial state- ments. The provisions of SFAS No. 141 apply to all business combinations initiated after June 30, 2001. In accordance with SFAS No. 142, intangible assets, includ- ing purchased goodwill, must be evaluated for impair- ment. Those intangible assets that will continue to be classified as goodwill or as other intangibles with indefi- nite lives are no longer amortized. 

In accordance with SFAS No. 142, the Company com- pleted its transitional impairment testing of intangible assets during the first quarter of fiscal 2002. That effort, and preliminary assessments of the Company’s identifi- able intangible assets, indicated that little or no adjustment would be required upon adoption of this pronouncement. The impairment testing is performed in two steps: (i) the Company determines impairment by comparing the fair value of a reporting unit with its carrying value, and (ii) if there is an impairment, the Company measures the amount of impairment loss by comparing the implied fair value of goodwill with the carrying amount of that good- will. Subsequent to the first quarter of fiscal 2002, with the assistance of a third-party valuation firm, the Company finalized the testing of goodwill. Using conservative, but realistic, assumptions to model the Company’s jane busi- ness, the Company determined that the carrying value of this unit was slightly greater than the derived fair value, indicating an impairment in the recorded goodwill. To 

