UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) March 9, 2005
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Books-A-Million, Inc.
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(Exact name of registrant as specified in its charter)
DELAWARE 0-20664 63-0798460
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
402 Industrial Lane, Birmingham, Alabama 35211
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (205) 942-3737
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N/A
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(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Section 4 - Matters Related to Accountants and Financial Statements
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
a) Based upon a clarification issued by the Securities and Exchange
Commission on February 7, 2005 in a letter to the American Institute of
Certified Public Accountants (AICPA), Books-A-Million, Inc. (the "Company")
reviewed and corrected its lease-related accounting policies. Specifically, the
Company is correcting its computation of depreciation for leasehold
improvements, its accounting for rent holidays and its classification of
landlord allowances related to leasehold improvements. On March 9, 2005, the
Company's Board of Directors adopted a recommendation of the Company's
management to restate the Company's financial statements for the five fiscal
years from fiscal 2000 through fiscal 2004 and for the first nine months of
fiscal 2005. As a result, the Company's statements of operations, balance
sheets, statements of cash flows and statements of stockholders' equity for
periods ended January 29, 2000 through October 30, 2004 should no longer be
relied on because of errors in such financial statements. On March 15, 2005,
the Audit Committee discussed the matters disclosed in this Item 4.02 (a)
with Deloitte & Touche LLP, the Company's independent registered public
accounting firm.
In previous periods, the Company depreciated leasehold improvements over a
period of ten years, regardless of the term of the lease for the store. The
Company corrected its depreciable life for leasehold improvements to the lesser
of the economic useful life of the asset or the term of the lease. Also, when
calculating the straight-line rent expense per store, the Company previously
used the store opening date as the starting date for the rent expense
calculation. The Company corrected this calculation to start straight-line rent
expense on the date the Company takes possession of the building for initial
set-up of fixtures and merchandise.
The Company also corrected its method of classification of landlord
allowances. For certain new stores, the Company receives funding from landlords
for the construction of leasehold improvements. Historically, landlord
allowances have been classified as a reduction of property and equipment on the
Company's balance sheet and as a reduction in capital expenditures in the
Company's statements of cash flows. However, the Company will now classify
landlord allowances as a deferred rent liability on the balance sheet and as an
operating activity in the statement of cash flows.
For the first nine months of fiscal 2005, the impact of the adjustments on
net income after taxes was an additional expense of $55,000. The impact on net
income after taxes for the five fiscal years from fiscal 2000 through fiscal
2004 was additional (income) or expense of $22,000, ($32,000), ($25,000),
$48,000 and $74,000, respectively. As of year-end fiscal 2005, property and
equipment on the balance sheet will increase by approximately $9.5 million and
other long-term liabilities will increase by approximately the same dollar
amount. This restatement did not impact historical net cash flows.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
_____________BOOKS-A-MILLION, INC._______
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(Registrant)
Date _March 22, 2005______________
_________/s/ Richard S. Wallington_______
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(Signature)
Name: Richard S. Wallington
Title: Chief Financial Officer