Item 14. Principal Accountant Fees and Services

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Item 14. Principal Accountant Fees and Services

The information required by this Item will appear under the headings “Audit Committee Report” and “Auditor Fees” in our Proxy Statement, which sections are incorporated in this item by reference.

PART IV

I TEM 15. Exhibits, Financial Statement Schedules

(a) Financial Statement Schedules

For a list of the consolidated financial information included herein, see Index to the Consolidated Financial Statements on page F-1.

Schedule II – Valuation and Qualifying Accounts

In thousandsBalance Beginning of PeriodAmounts Charged to Net IncomeWrite-Offs Against ReserveBalance End of Period
Sales Return Reserve:
Fiscal Year Ended February 1, 2014$36,618$1,667,466$1,666,655$37,429
Fiscal Year Ended February 2, 2013$22,348$1,603,462$1,589,192$36,618
Fiscal Year Ended January 28, 2012$17,151$1,387,956$1,382,759$22,348
Reserves Related to Former Operations:
Fiscal Year Ended February 1, 2014$45,229$(1,872)$11,994$31,363
Fiscal Year Ended February 2, 2013$45,381$16,996$17,148$45,229
Fiscal Year Ended January 28, 2012$54,695$33,547$42,861$45,381
Casualty Insurance Reserve:
Fiscal Year Ended February 1, 2014$14,632$71,093$71,029$14,696
Fiscal Year Ended February 2, 2013$9,079$50,730$45,177$14,632
Fiscal Year Ended January 28, 2012$14,241$(3,942)$1,220$9,079
Computer Intrusion Reserve:
Fiscal Year Ended February 1, 2014$15,767$—$2,913$12,854
Fiscal Year Ended February 2, 2013$15,864$—$97$15,767
Fiscal Year Ended January 28, 2012$17,340$—$1,476$15,864

(b) Exhibits

Listed below are all exhibits filed as part of this report. Some exhibits are filed by the Registrant with the Securities and Exchange Commission pursuant to Rule 12b-32 under the Exchange Act.

Exhibit No.Description of Exhibit
3(i).1Fourth Restated Certificate of Incorporation is incorporated herein by reference to Exhibit 99.1 to the Form 8-A/A filed September 9, 1999. Certificate of Amendment of Fourth Restated Certificate of Incorporation is incorporated herein by reference to Exhibit 3(i) to the Form 10-Q filed for the quarter ended July 28, 2005.
3(ii).1By-laws of TJX, as amended, are incorporated herein by reference to Exhibit 3.1 to the Form 8-K filed on September 22, 2009.
4.1Indenture between TJX and U.S. Bank National Association dated as of April 2, 2009, incorporated by reference to Exhibit 4.1 of the Registration Statement on Form S-3 filed on April 2, 2009 (File 333-158360).
4.2First Supplemental Indenture between TJX and U.S. Bank National Association dated as of April 7, 2009, incorporated by reference to Exhibit 4.1 to the Form 8-K filed on April 7, 2009.
4.3Second Supplemental Indenture between TJX and U.S. Bank National Association dated as of July 23, 2009, incorporated herein by reference to Exhibit 4.1 to the Form 8-K filed on July 23, 2009.
4.4Third Supplemental Indenture, dated as of May 2, 2013 by and between The TJX Companies, Inc. and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto, incorporated herein by reference to Exhibit 4.2 to the Form 8-K filed on May 2, 2013.
10.1The Employment Agreement dated as of June 13, 2012 between Bernard Cammarata and TJX is incorporated herein by reference to Exhibit 10.1 to the Form 10-Q filed for the quarter ended July 28, 2012.*
10.2The Employment Agreement dated February 1, 2013 between Carol Meyrowitz and TJX is incorporated herein by reference to Exhibit 10.2 to the Form 10-K filed for the year ended February 2, 2013.*
10.3The Employment Agreement dated February 1, 2013 between Ernie Herrman and TJX is incorporated herein by reference to Exhibit 10.4 to the Form 10-K filed for the year ended February 2, 2013.*
10.4The Employment Agreement dated as of January 29, 2012 between Jerome Rossi and TJX is incorporated herein by reference to Exhibit 10.6 to the Form 10-K filed for the year ended January 28, 2012. The Letter Agreement dated January 31, 2014 between Jerome Rossi and TJX is filed herewith.*
10.5The Employment Agreement dated January 31, 2014 between and among Michael MacMillan, NBC Attire, Inc. and TJX is filed herewith.*
10.6The Employment Agreement dated February 1, 2013 between Nan Stutz and TJX is incorporated herein by reference to Exhibit 10.7 to the Form 10-K filed for the year ended February 2, 2013.*
10.7The Employment Agreement effective as of January 29, 2012 between Richard Sherr and TJX is incorporated herein by reference to Exhibit 10.12 to the Form 10-K filed for the year ended January 28, 2012.*
10.8The Employment Agreement effective as of January 29, 2012 between Scott Goldenberg and TJX is incorporated herein by reference to Exhibit 10.13 to the Form 10-K filed for the year ended January 28, 2012.*
10.9The Stock Incentive Plan (2013 Restatement) is incorporated herein by reference to Exhibit 10.1 to the Form 10-Q filed for the quarter ended May 4, 2013.*
10.10The Stock Incentive Plan Rules for U.K. Employees, as amended April 7, 2009, is incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed for the quarter ended July 31, 2010.*
10.11The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as amended and restated through June 1, 2004 is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended July 31, 2004.*
10.12The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 17, 2009 is incorporated herein by reference to Exhibit 12.1 to the Form 10-Q filed for the quarter ended October 31, 2009. The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 17, 2009 is incorporated herein by reference to Exhibit 12.2 to the Form 10-Q filed for the quarter ended October 31, 2009.*
10.13The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 9, 2010 is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended October 30, 2010. The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 9, 2010 is incorporated herein by reference to Exhibit 10.19 to the Form 10-K filed for the year ended January 28, 2012.*
10.14The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 20, 2012 is incorporated herein by reference to Exhibit 10.1 to the Form 10-Q filed for the quarter ended October 27, 2012. The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 20, 2012 is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended October 27, 2012.*
10.15The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 19, 2013 is incorporated herein by reference to Exhibit 10.1 to the Form 10-Q filed for the quarter ended November 2, 2013. The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 19, 2013 is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended November 2, 2013.*
10.16The Form of Performance-Based Restricted Stock Award granted under the Stock Incentive Plan is incorporated herein by reference to Exhibit 10.13 to the Form 10-K filed for the fiscal year ended January 30, 2010. The Form of Performance-Based Restricted Stock Award granted under the Stock Incentive Plan as of April 2, 2012 is incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed for the quarter ended April 28, 2012. The Form of Performance-Based Restricted Stock Award granted under the Stock Incentive Plan as of February 1, 2013 is incorporated herein by reference to Exhibit 10.16 to the Form 10-K filed for the year ended February 2, 2013. The Form of Performance-Based Restricted Stock Award granted under the Stock Incentive Plan as of September 19, 2013 is incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed for the quarter ended November 2, 2013.*
10.17The Form of Performance-Based Deferred Stock Award granted under the Stock Incentive Plan is incorporated herein by reference to Exhibit 10.14 to the Form 10-K filed for the fiscal year ended January 30, 2010. The Form of Performance-Based Deferred Stock Award granted under the Stock Incentive Plan as of April 2, 2012 is incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed for the quarter ended April 28, 2012. The Form of Performance-Based Deferred Stock Award granted under the Stock Incentive Plan as of April 2, 2013 is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended May 4, 2013.*
10.18The Form of Deferred Stock Award for Directors granted under the Stock Incentive Plan is incorporated herein by reference to Exhibit 10.18 to the Form 10-K filed for the year ended February 2, 2013.*
10.19Description of Director Compensation Arrangements is filed herewith.*
10.20The Management Incentive Plan and Long Range Performance Incentive Plan (2013 Restatement) is incorporated herein by reference to Exhibit 10.22 to the Form 10-K filed for the year ended February 2, 2013.*
10.21The General Deferred Compensation Plan (1998 Restatement) (the “GDCP”) and First Amendment to the GDCP, effective January 1, 1999, are incorporated herein by reference to Exhibit 10.9 to the Form 10-K for the fiscal year ended January 30, 1999. The Second Amendment to the GDCP, effective January 1, 2000, is incorporated herein by reference to Exhibit 10.10 to the Form 10-K filed for the fiscal year ended January 29, 2000. The Third and Fourth Amendments to the GDCP are incorporated herein by reference to Exhibit 10.17 to the Form 10-K for the fiscal year ended January 28, 2006. The Fifth Amendment to the GDCP, effective January 1, 2008 is incorporated herein by reference to Exhibit 10.17 to the Form 10-K filed the fiscal year ended January 31, 2009.*
10.22The Supplemental Executive Retirement Plan (2008 Restatement) is incorporated herein by reference to Exhibit 10.18 to the Form 10-K filed for the fiscal year ended January 31, 2009.*
10.23The Executive Savings Plan (As Amended and Restated, Effective January 1, 2014) is filed herewith.*
10.24The Canadian Executive Savings Plan (effective November 1, 1999) of Winners Merchants International, LP (successor to Winners Apparel Ltd.) is incorporated herein by reference to Exhibit 10.26 to the Form 10-K filed for the year ended February 2, 2013.*
10.25The form of TJX Indemnification Agreement for its executive officers and directors is incorporated herein by reference to Exhibit 10(r) to the Form 10-K filed for the fiscal year ended January 27, 1990. *
10.26The Trust Agreement dated as of April 8, 1988 between TJX and State Street Bank and Trust Company is incorporated herein by reference to Exhibit 10(y) to the Form 10-K filed for the fiscal year ended January 30, 1988.*
10.27The Trust Agreement dated as of April 8, 1988 between TJX and Fleet Bank (formerly Shawmut Bank of Boston, N.A.) is incorporated herein by reference to Exhibit 10(z) to the Form 10-K filed for the fiscal year ended January 30, 1988.*
10.28The Trust Agreement for Executive Savings Plan dated as of January 1, 2005 between TJX and Wells Fargo Bank, N.A. is incorporated herein by reference to Exhibit 10.26 to the Form 10-K filed for the fiscal year ended January 29, 2005.*
21Subsidiaries of TJX, is filed herewith.
23Consent of Independent Registered Public Accounting Firm is filed herewith.
24Power of Attorney given by the Directors and certain Executive Officers of TJX is filed herewith.
31.1Certification Statement of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 is filed herewith.
31.2Certification Statement of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 is filed herewith.
32.1Certification Statement of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith.
32.2Certification Statement of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith.
101The following materials from The TJX Companies, Inc.’s Annual Report on Form 10-K for the fiscal year ended February 1, 2014, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Income, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statements of Shareholders’ Equity, and (vi) Notes to Consolidated Financial Statements.
*Management contract or compensatory plan or arrangement.

Unless otherwise indicated, exhibits incorporated by reference were filed under Commission File Number 001-04908.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE TJX COMPANIES, INC.
Dated: April 1, 2014
By/s/ SCOTT GOLDENBERG
Scott Goldenberg, Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

/s/ CAROL MEYROWITZ Carol Meyrowitz, Chief Executive Officer and Director (Principal Executive Officer)SCOTT GOLDENBERG* Scott Goldenberg, Chief Financial Officer (Principal Financial and Accounting Officer)
ZEIN ABDALLA* Zein Abdalla, DirectorMICHAEL F. HINES* Michael F. Hines, Director
JOSE B. ALVAREZ* José B. Alvarez, DirectorAMY B. LANE* Amy B. Lane, Director
ALAN M. BENNETT* Alan M. Bennett, DirectorDAWN LEPORE* Dawn Lepore, Director
BERNARD CAMMARATA* Bernard Cammarata, Chairman of the Board of DirectorsJOHN F. O’BRIEN* John F. O’Brien, Director
DAVID T. CHING* David T. Ching, DirectorWILLOW B. SHIRE* Willow B. Shire, Director
*BY/s/ SCOTT GOLDENBERG
Dated: April 1, 2014Scott Goldenberg,
for himself and as attorney-in-fact

The TJX Companies, Inc.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

For Fiscal Years Ended February 1, 2014, February 2, 2013 and January 28, 2012.

Report of Independent Registered Public Accounting FirmF-2
Consolidated Financial Statements:
Consolidated Statements of Income for the fiscal years ended February 1, 2014, February 2, 2013 and January 28, 2012F-3
Consolidated Statements of Comprehensive Income for the fiscal years ended February 1, 2014, February 2, 2013 and January 28, 2012F-4
Consolidated Balance Sheets as of February 1, 2014 and February 2, 2013F-5
Consolidated Statements of Cash Flows for the fiscal years ended February 1, 2014, February 2, 2013 and January 28, 2012F-6
Consolidated Statements of Shareholders’ Equity for the fiscal years ended February 1, 2014, February 2, 2013 and January 28, 2012F-7
Notes to Consolidated Financial StatementsF-8
Financial Statement Schedules:
Schedule II – Valuation and Qualifying Accounts42

F-1

Report of Independent Registered Public Accounting Firm

To The Board of Directors and Shareholders of The TJX Companies, Inc:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of The TJX Companies, Inc. and its subsidiaries (the “Company”) at February 1, 2014 and February 2, 2013, and the results of their operations and their cash flows for each of the three years in the period ended February 1, 2014 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of February 1, 2014, based on criteria established in Internal Control—Integrated Framework 1992 issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for these financial statements and the financial statement schedule, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedule, and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts

April 1, 2014

F-2

The TJX Companies, Inc.

Consolidated Statements of Income

Fiscal Year Ended
Amounts in thousands except per share amountsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Net sales$27,422,696$25,878,372$23,191,455
Cost of sales, including buying and occupancy costs19,605,03718,521,40016,854,249
Selling, general and administrative expenses4,467,0894,250,4463,890,144
Interest expense, net31,08129,17535,648
Income before provision for income taxes3,319,4893,077,3512,411,414
Provision for income taxes1,182,0931,170,664915,324
Net income$2,137,396$1,906,687$1,496,090
Basic earnings per share:
Net income$3.00$2.60$1.97
Weighted average common shares – basic713,470733,588761,109
Diluted earnings per share:
Net income$2.94$2.55$1.93
Weighted average common shares – diluted726,376747,555773,772
Cash dividends declared per share$0.58$0.46$0.38

The accompanying notes are an integral part of the financial statements.

F-3

The TJX Companies, Inc.

Consolidated Statements of Comprehensive Income

Fiscal Year Ended
Amounts in thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Net income$2,137,396$1,906,687$1,496,090
Other comprehensive income, net of related tax benefits/provisions:
Foreign currency translation adjustments, net of related tax benefit of $41,713, and provisions of $1,285 and $2,918 in fiscal 2014, 2013 and 2012, respectively(57,926)6,200(14,253)
Recognition of prior service cost and deferred gains/losses, net of related tax provisions of $11,001; $9,350 and $3,224, in fiscal 2014, 2013 and 2012, respectively16,50114,0264,833
Recognition of unfunded post retirement obligations, net of related tax provision of $36,856, and benefits of $27,362 and $60,933 in fiscal 2014, 2013 and 2012, respectively55,285(41,043)(91,400)
Total comprehensive income$2,151,256$1,885,870$1,395,270

The accompanying notes are an integral part of the financial statements.

F-4

The TJX Companies, Inc.

Consolidated Balance Sheets

Fiscal Year Ended
Amounts in thousands except share amountsFebruary 1, 2014February 2, 2013
ASSETS
Current assets:
Cash and cash equivalents$2,149,746$1,811,957
Short-term investments294,702235,853
Accounts receivable, net210,094222,788
Merchandise inventories2,966,4903,014,214
Prepaid expenses and other current assets345,327330,512
Current deferred income taxes, net101,63996,219
Total current assets6,067,9985,711,543
Property at cost:
Land and buildings722,645607,759
Leasehold costs and improvements2,720,3912,514,998
Furniture, fixtures and equipment4,255,2103,771,999
Total property at cost7,698,2466,894,756
Less accumulated depreciation and amortization4,103,7453,671,514
Net property at cost3,594,5013,223,242
Non-current deferred income taxes, net31,508—
Other assets194,328260,801
Goodwill and tradenames, net of amortization312,687316,269
TOTAL ASSETS$10,201,022$9,511,855
LIABILITIES
Current liabilities:
Accounts payable$1,771,294$1,930,568
Accrued expenses and other current liabilities1,681,8341,666,216
Federal, foreign and state income taxes payable64,715163,812
Total current liabilities3,517,8433,760,596
Other long-term liabilities732,999961,284
Non-current deferred income taxes, net446,071349,486
Long-term debt, exclusive of current installments1,274,216774,552
Commitments and contingencies——
SHAREHOLDERS’ EQUITY
Common stock, authorized 1,200,000,000 shares, par value $1, issued and outstanding 705,016,838 and 723,902,001, respectively705,017723,902
Additional paid-in capital——
Accumulated other comprehensive income (loss)(199,532)(213,392)
Retained earnings3,724,4083,155,427
Total shareholders’ equity4,229,8933,665,937
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$10,201,022$9,511,855

The accompanying notes are an integral part of the financial statements.

F-5

The TJX Companies, Inc.

Consolidated Statements of Cash Flows

Fiscal Year Ended
Amounts in thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Cash flows from operating activities:
Net income$2,137,396$1,906,687$1,496,090
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization548,823508,929485,701
Loss on property disposals and impairment charges7,91411,87613,559
Deferred income tax provision52,23313,265144,762
Share-based compensation76,08064,41664,175
Excess tax benefits from share-based compensation(82,546)(62,472)(46,143)
Changes in assets and liabilities:
Decrease (increase) in accounts receivable11,979(18,418)(4,410)
Decrease (increase) in merchandise inventories35,23327,186(187,157)
(Increase) in prepaid expenses and other current assets(3,354)(53,705)(20,709)
(Decrease) increase in accounts payable(152,271)211,689(36,553)
(Decrease) increase in accrued expenses and other liabilities(29,590)268,90113,747
Increase (decrease) in income taxes payable10,994176,076(3,097)
Other(22,562)(8,816)(3,931)
Net cash provided by operating activities2,590,3293,045,6141,916,034
Cash flows from investing activities:
Property additions(946,678)(978,228)(803,330)
Purchase of short-term investments(478,136)(355,736)(152,042)
Sales and maturities of short-term investments386,530213,000132,679
Cash paid for acquisition of Sierra Trading Post, net of cash received2,653(190,374)—
Other—34,49011,652
Net cash (used in) investing activities(1,035,631)(1,276,848)(811,041)
Cash flows from financing activities:
Proceeds from issuance of long-term debt499,555——
Cash payments for debt issuance expenses(4,297)(1,370)(2,299)
Cash payments for rate lock agreement(3,251)——
Cash payments on capital lease obligation—(1,456)(2,727)
Cash payments for repurchase of common stock(1,471,096)(1,345,082)(1,320,812)
Proceeds from issuance of common stock146,495133,771218,999
Excess tax benefits from share-based compensation82,54662,47246,143
Cash dividends paid(393,755)(323,922)(275,016)
Net cash (used in) financing activities(1,143,803)(1,475,587)(1,335,712)
Effect of exchange rate changes on cash(73,106)11,666(3,920)
Net increase (decrease) in cash and cash equivalents337,789304,845(234,639)
Cash and cash equivalents at beginning of year1,811,9571,507,1121,741,751
Cash and cash equivalents at end of year$2,149,746$1,811,957$1,507,112

The accompanying notes are an integral part of the financial statements.

F-6

The TJX Companies, Inc.

Consolidated Statements of Shareholders’ Equity

Common StockAdditional Paid-In CapitalAccumulated Other Comprehensive Income (Loss)Retained EarningsTotal
Amounts in thousandsSharesPar Value $1
Balance, January 29, 2011779,314$779,314$—$(91,755)$2,412,340$3,099,899
Comprehensive income:
Net income————1,496,0901,496,090
Foreign currency translation adjustments———(14,253)—(14,253)
Recognition of prior service cost and deferred gains/losses———4,833—4,833
Recognition of unfunded post retirement obligations———(91,400)—(91,400)
Total comprehensive income1,395,270
Cash dividends declared on common stock————(288,035)(288,035)
Recognition of share-based compensation——64,175——64,175
Issuance of common stock under stock incentive plan and related tax effect15,74415,744243,049——258,793
Common stock repurchased(48,356)(48,356)(307,224)—(965,232)(1,320,812)
Balance, January 28, 2012746,702746,702—(192,575)2,655,1633,209,290
Comprehensive income:
Net income————1,906,6871,906,687
Foreign currency translation adjustments———6,200—6,200
Recognition of prior service cost and deferred gains/losses———14,026—14,026
Recognition of unfunded post retirement obligations———(41,043)—(41,043)
Total comprehensive income1,885,870
Cash dividends declared on common stock————(336,214)(336,214)
Recognition of share-based compensation——64,416——64,416
Issuance of common stock under stock incentive plan and related tax effect9,1599,159178,498——187,657
Common stock repurchased(31,959)(31,959)(242,914)—(1,070,209)(1,345,082)
Balance, February 2, 2013723,902723,902—(213,392)3,155,4273,665,937
Comprehensive income:
Net income————2,137,3962,137,396
Foreign currency translation adjustments———(57,926)—(57,926)
Recognition of unfunded post retirement obligations———55,285—55,285
Recognition of prior service cost and deferred gains/losses———16,501—16,501
Total comprehensive income2,151,256
Cash dividends declared on common stock————(413,134)(413,134)
Recognition of share-based compensation——76,080——76,080
Issuance of common stock under stock incentive plan and related tax effect8,4628,462212,388——220,850
Common stock repurchased(27,347)(27,347)(288,468)—(1,155,281)(1,471,096)
Balance, February 1, 2014705,017$705,017$—$(199,532)$3,724,408$4,229,893

The accompanying notes are an integral part of the financial statements.

F-7

Notes to Consolidated Financial Statements

Note A. Summary of Accounting Policies

Basis of Presentation: The consolidated financial statements of The TJX Companies, Inc. (referred to as “TJX” or “we”) include the financial statements of all of TJX’s subsidiaries, all of which are wholly owned. All of its activities are conducted by TJX or its subsidiaries and are consolidated in these financial statements. All intercompany transactions have been eliminated in consolidation.

Fiscal Year: TJX’s fiscal year ends on the Saturday nearest to the last day of January of each year. The fiscal years ended February 1, 2014 (fiscal 2014) and January 28, 2012 (fiscal 2012) each included 52 weeks. The fiscal year ended February 2, 2013 (fiscal 2013) included 53 weeks.

Earnings Per Share: All earnings per share amounts refer to diluted earnings per share, unless otherwise indicated, and have been adjusted to reflect the two-for-one stock split in the form of a dividend effected in February, 2012.

Use of Estimates: The preparation of the TJX financial statements, in conformity with accounting principles generally accepted in the United States of America (GAAP), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. TJX considers its accounting policies relating to inventory valuation, impairments of long-lived assets, goodwill and tradenames, retirement obligations, share-based compensation, casualty insurance, reserves for uncertain tax positions, reserves for former operations and loss contingencies to be the most significant accounting policies that involve management estimates and judgments. Actual amounts could differ from those estimates, and such differences could be material.

Revenue Recognition: TJX records revenue at the time of sale and receipt of merchandise by the customer, net of a reserve for estimated returns. We estimate returns based upon our historical experience. We defer recognition of a layaway sale and its related profit to the accounting period when the customer receives the layaway merchandise. Proceeds from the sale of gift cards as well as the value of store cards issued to customers as a result of a return or exchange are deferred until the customers use the cards to acquire merchandise. Based on historical experience, we estimate the amount of gift cards and store cards that will not be redeemed (“breakage”) and, to the extent allowed by local law; these amounts are amortized into income over the redemption period. Revenue recognized from breakage was $17.5 million in fiscal 2014, $13.9 million in fiscal 2013 and $10.9 million in fiscal 2012. We estimate the date of receipt by the customer when recognizing revenue from sales by our e-commerce operations and shipping and handling costs charged to the customer are included in revenue. The shipping and handling costs incurred by TJX are included in cost of sales, including buying and occupancy costs.

Consolidated Statements of Income Classifications: Cost of sales, including buying and occupancy costs, includes the cost of merchandise sold and gains and losses on inventory and fuel-related derivative contracts; store occupancy costs (including real estate taxes, utility and maintenance costs and fixed asset depreciation); the costs of operating distribution centers; payroll, benefits and travel costs directly associated with buying inventory; and systems costs related to the buying and tracking of inventory.

Selling, general and administrative expenses include store payroll and benefit costs; communication costs; credit and check expenses; advertising; administrative and field management payroll, benefits and travel costs; corporate administrative costs and depreciation; gains and losses on non-inventory related foreign currency exchange contracts; and other miscellaneous income and expense items.

Cash and Cash Equivalents: TJX generally considers highly liquid investments with a maturity of 90 days or less at the date of purchase to be cash equivalents. Investments with maturities greater than 90 days but less than one year at the date of purchase are included in short-term investments. These investments are classified as trading securities and are stated at fair value. Investments are classified as either short- or long-term based on their original maturities. TJX’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks.

F-8

As of February 1, 2014, TJX’s cash and cash equivalents held outside the U.S. were $1.1 billion, of which $395.2 million was held in countries where TJX has the intention to reinvest any undistributed earnings indefinitely.

Merchandise Inventories: Inventories are stated at the lower of cost or market. TJX uses the retail method for valuing inventories at all of its divisions, except STP, which results in a weighted average cost. TJX utilizes a permanent markdown strategy and lowers the cost value of the inventory that is subject to markdown at the time the retail prices are lowered in the stores. TJX accrues for inventory obligations at the time inventory is shipped. As a result, merchandise inventories on TJX’s balance sheet include an accrual for in-transit inventory of $451.6 million at February 1, 2014 and $418.3 million at February 2, 2013. Comparable amounts were reflected in accounts payable at those dates.

Common Stock and Equity: In February 2012, TJX effected a two-for-one stock split of its common stock in the form of a stock dividend resulting in the issuance of 372 million shares of common stock. The statements of shareholders’ equity for fiscal 2012 have been adjusted to retroactively reflect the two-for-one stock split. In addition, all historical per share amounts and references to common stock activity, as well as basic and diluted share amounts utilized in the calculation of earnings per share in this report, have been adjusted to reflect this stock split.

Equity transactions consist primarily of the repurchase by TJX of its common stock under its stock repurchase programs and the recognition of compensation expense and issuance of common stock under TJX’s stock incentive plan. Under TJX’s stock repurchase programs the Company repurchases its common stock on the open market. The par value of the shares repurchased is charged to common stock with the excess of the purchase price over par first charged against any available additional paid-in capital (“APIC”) and the balance charged to retained earnings. Due to the high volume of repurchases over the past several years, TJX has no remaining balance in APIC at the end of any of the years presented. All shares repurchased have been retired.

Shares issued under TJX’s stock incentive plan are issued from authorized but unissued shares, and proceeds received are recorded by increasing common stock for the par value of the shares with the excess over par added to APIC. Income tax benefits upon the expensing of options result in the creation of a deferred tax asset, while income tax benefits due to the exercise of stock options reduce deferred tax assets up to the amount that an asset for the related grant has been created. Any tax benefits greater than the deferred tax assets created at the time of expensing the options are credited to APIC; any deficiencies in the tax benefits are debited to APIC to the extent a pool for such deficiencies exists. In the absence of a pool any deficiencies are realized in the related periods’ statements of income through the provision for income taxes. Any excess income tax benefits are included in cash flows from financing activities in the statements of cash flows. The par value of restricted stock awards is also added to common stock when the stock is issued, generally at grant date. The fair value of the restricted stock awards in excess of par value is added to APIC as the awards are amortized into earnings over the related requisite service periods.

Share-Based Compensation: TJX accounts for share-based compensation by estimating the fair value of each award on the date of grant. TJX uses the Black-Scholes option pricing model for options awarded and for performance-based restricted stock awards TJX uses the market price on the grant date. See Note I for a detailed discussion of share-based compensation.

Interest: TJX’s interest expense is presented as a net amount. The following is a summary of net interest expense:

Fiscal Year Ended
Dollars in thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Interest expense$57,084$48,582$49,276
Capitalized interest(10,993)(7,750)(2,593)
Interest (income)(15,010)(11,657)(11,035)
Interest expense, net$31,081$29,175$35,648

TJX capitalizes interest during the active construction period of major capital projects. Capitalized interest is added to the cost of the related assets. Capitalized interest in fiscal 2014, 2013 and 2012 relates to costs on active owned real estate projects and development costs on a merchandising system.

F-9

Depreciation and Amortization: For financial reporting purposes, TJX provides for depreciation and amortization of property using the straight-line method over the estimated useful lives of the assets. Buildings are depreciated over 33 years. Leasehold costs and improvements are generally amortized over their useful life or the committed lease term (typically 10 years), whichever is shorter. Furniture, fixtures and equipment are depreciated over 3 to 10 years. Depreciation and amortization expense for property was $555.8 million in fiscal 2014, $515.9 million for fiscal 2013 and $490.6 million for fiscal 2012. Amortization expense for property held under a capital lease was $1.7 million in fiscal 2013 and $2.2 million in fiscal 2012. TJX had no property held under capital lease during fiscal 2014. Maintenance and repairs are charged to expense as incurred. Significant costs incurred for internally developed software are capitalized and amortized over 3 to 10 years. Upon retirement or sale, the cost of disposed assets and the related accumulated depreciation are eliminated and any gain or loss is included in income. Pre-opening costs, including rent, are expensed as incurred.

Lease Accounting: TJX begins to record rent expense when it takes possession of a store, which is typically 30 to 60 days prior to the opening of the store and generally occurs before the commencement of the lease term, as specified in the lease.

Long-Lived Assets: Information related to carrying values of TJX’s long-lived assets by geographic location is presented below:

Fiscal Year Ended
Dollars in thousandsFebruary 1, 2014February 2, 2013January 28, 2012
United States$2,693,670$2,350,539$1,879,176
Canada214,459237,232220,522
Europe686,372635,471615,427
Total long-lived assets$3,594,501$3,223,242$2,715,125

Goodwill and Tradename: Goodwill includes the excess of the purchase price paid over the carrying value of the minority interest acquired in fiscal 1990 in TJX’s former 83%-owned subsidiary and represents goodwill associated with the T.J. Maxx chain, as well as the excess of cost over the estimated fair market value of the net assets acquired by TJX in the purchase of Winners in fiscal 1991 and the purchase of Sierra Trading Post in fiscal 2013 (See Note B).

Goodwill totaled $169.3 million as of February 1, 2014, $170.3 million as of February 2, 2013 and $72.2 million as of January 28, 2012. Goodwill is considered to have an indefinite life and accordingly is not amortized.

Tradename is the value assigned to the name “Marshalls,” acquired by TJX in fiscal 1996 as part of the acquisition of the Marshalls chain and the value assigned to the name “Sierra Trading Post,” acquired by TJX in fiscal 2013. The value of the tradename was determined by the discounted present value of assumed after-tax royalty payments, offset by a reduction in the case of Marshalls, for the pro-rata share of negative goodwill acquired. The Marshalls tradename is carried at a value of $107.7 million and is considered to have an indefinite life. The Sierra Trading Post tradename is being amortized over 15 years and is carried at a value of $35.7 million in fiscal 2014 and $38.3 million in fiscal 2013 net of amortization of $2.8 million and $0.2 million, respectively.

TJX occasionally acquires or licenses other trademarks to be used in connection with private label merchandise. Such trademarks are included in other assets and are amortized to cost of sales, including buying and occupancy costs, over their useful life, generally from 7 to 10 years.

Goodwill, tradename and trademarks, and the related accumulated amortization if any, are included in the respective operating segment to which they relate.

Impairment of Long-Lived Assets, Goodwill and Tradename: TJX evaluates its long-lived assets, goodwill and tradename for indicators of impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable, and at least annually in the fourth quarter of each fiscal year. An impairment exists when the undiscounted cash flow of an asset or asset group is less than the carrying cost of that asset or asset group. The evaluation for long-lived assets is performed at the lowest level of identifiable

F-10

cash flows, which is generally at the individual store level. If indicators of impairment are identified, an undiscounted cash flow analysis is performed to determine if an impairment exists. The store-by-store evaluations did not indicate any recoverability issues (for any of our continuing operations) in each of the past three fiscal years.

Goodwill is tested for impairment whenever events or changes in circumstances indicate that an impairment may have occurred and at least annually in the fourth quarter of each fiscal year, using a quantitative assessment by comparing the carrying value of the related reporting unit to its fair value. An impairment exists when this analysis, using typical valuation models such as the discounted cash flow method, shows that the fair value of the reporting unit is less than the carrying cost of the reporting unit. We may assess qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. The assessment of qualitative factors is optional and at the Company’s discretion. We may bypass the qualitative assessment in any period and perform the first step of the quantitative goodwill impairment test as we did in fiscal 2014.

Tradename is also tested for impairment whenever events or changes in circumstances indicate that the carrying amount of the tradename may exceed its fair value and at least annually in the fourth quarter of each fiscal year. Testing is performed by comparing the discounted present value of assumed after-tax royalty payments to the carrying value of the tradename.

There was no impairment related to our goodwill or tradename in fiscal 2014, 2013 or 2012.

Advertising Costs: TJX expenses advertising costs as incurred. Advertising expense was $333.5 million for fiscal 2014, $298.6 million for fiscal 2013 and $271.6 million for fiscal 2012.

Foreign Currency Translation: TJX’s foreign assets and liabilities are translated into U.S. dollars at fiscal year-end exchange rates with resulting translation gains and losses included in shareholders’ equity as a component of accumulated other comprehensive income (loss). Activity of the foreign operations that affect the statements of income and cash flows is translated at average exchange rates prevailing during the fiscal year.

Loss Contingencies: TJX records a reserve for loss contingencies when it is both probable that a loss will be incurred and the amount of the loss is reasonably estimable. TJX evaluates pending litigation and other contingencies at least quarterly and adjusts the reserve for such contingencies for changes in probable and reasonably estimable losses. TJX includes an estimate for related legal costs at the time such costs are both probable and reasonably estimable.

New Accounting Standards: TJX has reviewed recently issued accounting pronouncements and does not expect their adoption to have a significant impact on the Company’s results of operations, financial position or cash flow.

Reclassifications: We have reclassified certain prior year amounts in Note L for comparative purposes.

Note B. Acquisition of Sierra Trading Post

On December 21, 2012, TJX acquired Sierra Trading Post (STP), an off-price Internet retailer, which includes the operating assets of its online business, sierratradingpost.com and four retail locations. The final purchase price, after adjusting for customary post-closing adjustments, amounted to $193 million.

The acquisition was accounted for using the purchase method of accounting, accordingly, the purchase price has been allocated to the tangible assets and liabilities and intangible assets acquired, based on their estimated fair values.

F-11

The following table presents the allocation of the final purchase price, after adjusting for customary post-closing adjustments, to the assets and liabilities acquired based on their estimated fair values as of December 21, 2012:

Dollars in thousandsAllocation of purchase price
Current assets$100,575
Property and equipment39,862
Other assets497
Intangible assets143,754
Total assets acquired284,688
Total liabilities assumed91,559
Net assets acquired$193,129

The intangible assets include identified intangible assets of $39 million for the value of the tradename “Sierra Trading Post” which is being amortized over 15 years (See Note A) and $8 million for customer relationships which is being amortized over 6 years. The remaining balance of the intangible assets is goodwill of $97 million.

The results of STP have been included in TJX’s consolidated financial statements from the date of acquisition and have been included with the Marmaxx segment. Pro forma results of operations assuming the acquisition of STP occurred as of the beginning of fiscal 2013 have not been presented, as the inclusion of the results of operations for the acquired business would not have produced a material impact on the reported sales, net income or earnings per share of TJX.

Note C. Dispositions and Reserves Related to Former Operations

Consolidation of A.J. Wright: In fiscal 2011, TJX’s Board of Directors approved the consolidation of the A.J. Wright division whereby TJX would convert 90 A.J. Wright stores into T.J. Maxx, Marshalls or HomeGoods stores and close the remaining 72 A.J. Wright stores, two distribution centers and home office. The liquidation process commenced in the fourth quarter of fiscal 2011 and was completed during the first quarter of fiscal 2012. Both distribution centers had been sold by February 2, 2013.

The A.J. Wright consolidation was not classified as a discontinued operation due to our expectation that a significant portion of the sales of the A.J. Wright stores would migrate to other TJX stores. Thus the costs incurred in fiscal 2012 relating to the A.J. Wright consolidation are reflected in continuing operations as part of the A.J. Wright segment which reported a segment loss of $49 million for the first quarter of fiscal 2012 including the following:

Fiscal Year Ended
In thousandsJanuary 28, 2012
Lease obligations and other closing costs$32,686
Operating losses16,605
Total segment loss$49,291

Fiscal 2012 also included $20 million of costs to convert the 90 A.J. Wright stores to other banners, with $17 million incurred by the Marmaxx segment and $3 million incurred by the HomeGoods segment.

F-12

Reserves Related to Former Operations: TJX has a reserve for its estimate of future obligations of business operations it has closed or sold. The reserve activity for the last three fiscal years is presented below:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
Balance at beginning of year$45,229$45,381$54,695
Additions (reductions) to the reserve charged to net income:
A.J. Wright closing costs(3,312)16,00032,686
Interest accretion1,440996861
Charges against the reserve:
Lease-related obligations(11,088)(15,682)(21,821)
Termination benefits and all other(906)(1,466)(21,040)
Balance at end of year$31,363$45,229$45,381

In the fourth quarter of fiscal 2014, TJX decreased this reserve by $3.3 million and in the third quarter of fiscal 2013, TJX increased this reserve by $16 million. These adjustments were required to reflect a change in TJX’s estimate of lease-related obligations. In the first quarter of fiscal 2012, TJX increased this reserve by $33 million for the initial estimated costs of closing the A.J. Wright stores that were not converted to other banners or closed in fiscal 2011.

The lease-related obligations included in the reserve reflect TJX’s estimation of lease costs, net of estimated subtenant income, and the cost of probable claims against TJX for liability, as an original lessee or guarantor of the leases of A.J. Wright and other former TJX businesses, after mitigation of the number and cost of these lease obligations. The actual net cost of these lease-related obligations may differ from TJX’s estimate. TJX estimates that the majority of the former operations reserve will be paid in the next two to three years. The actual timing of cash outflows will vary depending on how the remaining lease obligations are actually settled.

TJX may also be contingently liable on up to 11 leases of BJ’s Wholesale Club, a former TJX business, and up to four leases of Bob’s Stores, also a former TJX business, in addition to leases included in the reserve. The reserve for former operations does not reflect these leases because TJX believes that the likelihood of future liability to TJX is remote.

F-13

Note D. Accumulated Other Comprehensive Income (Loss)

Amounts included in accumulated other comprehensive income (loss) related to the Company’s foreign currency translation adjustments and minimum pension and other post-retirement liabilities are recorded net of the related income tax effects. The following table details the changes in accumulated other comprehensive income (loss) for fiscal 2014, fiscal 2013 and fiscal 2012:

Amounts in thousandsForeign Currency TranslationDeferred Benefit CostsAccumulated Other Comprehensive Income (Loss)
Balance, January 29, 2011$(10,590)$(81,165)$(91,755)
Foreign currency translation adjustments (net of taxes of $2,918)(14,253)—(14,253)
Deferred pension and other post-retirement benefit costs (net of taxes of $60,933)—(91,400)(91,400)
Reclassification adjustments———
Amortization of deferred benefit costs (net of taxes of $3,224)—4,8334,833
Balance, January 28, 2012(24,843)(167,732)(192,575)
Foreign currency translation adjustments (net of taxes of $1,285)6,200—6,200
Deferred pension and other post-retirement benefit costs (net of taxes of $27,362)—(41,043)(41,043)
Reclassification adjustments———
Amortization of deferred benefit costs (net of taxes of $9,350)—14,02614,026
Balance, February 2, 201****3(18,643)(194,749)(213,392)
Foreign currency translation adjustments (net of taxes of $41,713)(57,926)—(57,926)
Deferred pension and other post-retirement benefit costs (net of taxes of $36,856)—55,28555,285
Reclassification adjustments———
Amortization of deferred benefit costs (net of taxes of $11,001)—16,50116,501
Balance, February 1, 2014$(76,569)$(122,963)$(199,532)

Note E. Capital Stock and Earnings Per Share

Capital Stock: In February 2012, TJX effected a two-for-one stock split in the form of a stock dividend. All share and per share information has been retroactively adjusted to reflect the stock split (See Note A).

TJX repurchased and retired 27.0 million shares of its common stock at a cost of $1.5 billion during fiscal 2014, on a “trade date basis.” TJX reflects stock repurchases in its financial statements on a “settlement date” or cash basis. TJX had cash expenditures under repurchase programs of $1.5 billion in fiscal 2014, $1.3 billion in fiscal 2013 and $1.3 billion in fiscal 2012 and repurchased 27.3 million shares in fiscal 2014, 32.0 million shares in fiscal 2013 and 48.4 million shares in fiscal 2012. These expenditures were funded primarily by cash generated from operations. In April 2012, TJX completed the $1 billion stock repurchase program authorized in February 2011 and in October 2013 TJX completed the $2 billion stock repurchase program authorized in January 2012. In February 2013, TJX’s Board of Directors approved another stock repurchase program that authorized the repurchase of up to an additional $1.5 billion of TJX common stock from time to time.

Under the repurchase program authorized in February 2013, on a “trade date” basis, TJX repurchased 8.6 million shares of common stock at a cost of $530.2 million during fiscal 2014 and $969.8 million remained available at February 1, 2014 under this program.

All shares repurchased under the stock repurchase programs have been retired.

On January 31, 2014, TJX’s Board of Directors approved a new stock repurchase program that authorizes the repurchase of up to an additional $2.0 billion of TJX common stock from time to time.

F-14

TJX has five million shares of authorized but unissued preferred stock, $1 par value.

Earnings Per Share: The following schedule presents the calculation of basic and diluted earnings per share for income from continuing operations:

Fiscal Year Ended
Amounts in thousands except per share amountsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Basic earnings per share:
Net income$2,137,396$1,906,687$1,496,090
Weighted average common stock outstanding for basic earnings per share calculation713,470733,588761,109
Basic earnings per share$3.00$2.60$1.97
Diluted earnings per share:
Net income$2,137,396$1,906,687$1,496,090
Weighted average common stock outstanding for basic earnings per share calculation713,470733,588761,109
Assumed exercise / vesting of:
Stock options and awards12,90613,96712,663
Weighted average common stock outstanding for diluted earnings per share calculation726,376747,555773,772
Diluted earnings per share$2.94$2.55$1.93

The weighted average common shares for the diluted earnings per share calculation excludes the impact of outstanding stock options if the assumed proceeds per share of the option is in excess of the related fiscal period’s average price of TJX’s common stock. Such options are excluded because they would have an antidilutive effect. There were 4.7 million and 4.9 million such options excluded at the end of fiscal 2014 and fiscal 2013, respectively. There were no such options excluded at the end of fiscal 2012.

Note F. Financial Instruments

As a result of its operating and financing activities, TJX is exposed to market risks from changes in interest and foreign currency exchange rates and fuel costs. These market risks may adversely affect TJX’s operating results and financial position. When and to the extent deemed appropriate, TJX seeks to minimize risk from changes in interest and foreign currency exchange rates and fuel costs through the use of derivative financial instruments. TJX does not use derivative financial instruments for trading or other speculative purposes and does not use any leveraged derivative financial instruments. TJX recognizes all derivative instruments as either assets or liabilities in the statements of financial position and measures those instruments at fair value. The fair values of the derivatives are classified as assets or liabilities, current or non-current, based upon valuation results and settlement dates of the individual contracts. Changes to the fair value of derivative contracts that do not qualify for hedge accounting are reported in earnings in the period of the change. For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of other comprehensive income or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged. TJX does not hedge its net investments in foreign subsidiaries.

Diesel Fuel Contracts: TJX hedges portions of its estimated notional diesel requirements, based on the diesel fuel expected to be consumed by independent freight carriers transporting TJX’s inventory. Independent freight carriers transporting TJX’s inventory charge TJX a mileage surcharge for diesel fuel price increases as incurred by the carrier. The hedge agreements are designed to mitigate the volatility of diesel fuel pricing (and the resulting per mile surcharges payable by TJX) by setting a fixed price per gallon for the period being hedged. TJX elected not to apply hedge accounting rules to these contracts. During fiscal 2013, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2014. Similarly, during fiscal 2014, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2015. As of February 1, 2014, TJX had hedge contracts outstanding relating to 42% of its estimated notional diesel requirements for fiscal 2015. These diesel fuel hedge agreements will settle throughout fiscal 2015.

F-15

Foreign Currency Contracts: TJX enters into forward foreign currency exchange contracts to obtain economic hedges on portions of merchandise purchases made and anticipated to be made by TJX Europe (United Kingdom, Ireland, Germany and Poland), TJX Canada (Canada), Marmaxx (U.S.) and HomeGoods (U.S.) in currencies other than their respective functional currencies. These contracts typically have a term of twelve months or less. The contracts outstanding at February 1, 2014 cover a portion of such actual and anticipated merchandise purchases throughout fiscal 2015. TJX elected not to apply hedge accounting rules to these contracts.

TJX also enters into derivative contracts, generally designated as fair value hedges, to hedge intercompany debt and intercompany interest payable. The changes in fair value of these contracts are recorded in selling, general and administrative expenses and are offset by marking the underlying item to fair value in the same period. Upon settlement, the realized gains and losses on these contracts are offset by the realized gains and losses of the underlying item in selling, general and administrative expenses.

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at February 1, 2014:

In thousandsPayReceiveBlended Contract RateBalance Sheet LocationCurrent Asset U.S.$Current (Liability) U.S.$Net Fair Value in U.S.$ at February 1, 2014
Fair value hedges:
Intercompany balances, primarily short-term debt and related interest
zł 84,073C$ 29,0820.3459(Accrued Exp)$—$(348)$(348)
€ 39,000£ 32,6460.8371Prepaid Exp1,015—1,015
€ 44,850U.S.$ 60,8271.3562Prepaid Exp335—335
U.S.$ 90,309£ 55,0000.6090(Accrued Exp)—(182)(182)
Economic hedges for which hedge accounting was not elected:
Diesel contractsFixed on 1.2M —1.9M gal per monthFloat on 1.2M —1.9M gal per monthN/APrepaid Exp137—137
Merchandise purchase commitments
C$ 388,745U.S.$ 365,1000.9392Prepaid Exp / (Accrued Exp)16,466(40)16,426
C$ 15,202€ 10,5000.6907Prepaid Exp / (Accrued Exp)548(38)510
£ 174,102U.S.$ 280,7001.6123Prepaid Exp / (Accrued Exp)132(5,385)(5,253)
zł 113,571£ 22,4420.1976Prepaid Exp984—984
U.S.$ 442¥ 2,6806.0633Prepaid Exp———
U.S.$ 12,464€ 9,1590.7348Prepaid Exp / (Accrued Exp)2(114)(112)
Total fair value of financial instruments$19,619$(6,107)$13,512

F-16

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at February 2, 2013:

In thousandsPayReceiveBlended Contract RateBalance Sheet LocationCurrent Asset U.S.$Current (Liability) U.S.$Net Fair Value in U.S.$ at February 2, 2013
Fair value hedges:
Intercompany balances, primarily short-term debt and related interest
zł 141,500C$ 44,5510.3148(Accrued Exp)$—$(1,357)$(1,357)
€ 44,281£ 35,7810.8080(Accrued Exp)—(4,531)(4,531)
€ 90,292U.S.$ 118,5111.3125(Accrued Exp)—(4,823)(4,823)
U.S.$ 87,117£ 55,0000.6313(Accrued Exp)—(974)(974)
Economic hedges for which hedge accounting was not elected:
Diesel contractsFixed on 1.1M —1.7M gal per monthFloat on 1.1M —1.7M gal per monthN/APrepaid Exp3,372—3,372
Merchandise purchase commitments
C$ 238,273U.S.$ 240,8141.0107Prepaid Exp / (Accrued Exp)2,205(189)2,016
C$ 4,752€ 3,7000.7786Prepaid Exp282—282
£ 67,746U.S.$ 108,9001.6075Prepaid Exp2,602—2,602
£ 10,935€ 13,0001.1888Prepaid Exp565—565
U.S.$ 7,099€ 5,4430.7667Prepaid Exp326—326
Total fair value of financial instruments$9,352$(11,874)$(2,522)

The impact of derivative financial instruments on the statements of income during fiscal 2014, fiscal 2013 and fiscal 2012 are as follows:

Amount of Gain (Loss) Recognized in Income by Derivative
In thousandsLocation of Gain (Loss) Recognized in Income by DerivativeFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Fair value hedges:
Intercompany balances, primarily short-term debt and related interestSelling, general and administrative expenses$6,099$(7,661)$4,313
Economic hedges for which hedge accounting was not elected:
Diesel contractsCost of sales, including buying and occupancy costs(1,831)4,2611,626
Merchandise purchase commitmentsCost of sales, including buying and occupancy costs22,338(2,084)(1,345)
Gain (loss) recognized in income$26,606$(5,484)$4,594

Included in the table above are realized gains of $10.7 million in fiscal 2014, gains of $1.2 million in fiscal 2013 and losses of $1.2 million in fiscal 2012 all of which were largely offset by gains and losses on the underlying hedged item.

F-17

Note G. Disclosures about Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or “exit price.” The inputs used to measure fair value are generally classified into the following hierarchy:

Level 1:Unadjusted quoted prices in active markets for identical assets or liabilities
Level 2:Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability
Level 3:Unobservable inputs for the asset or liability

The following table sets forth TJX’s financial assets and liabilities that are accounted for at fair value on a recurring basis:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Level 1
Assets:
Executive Savings Plan investments$131,049$101,903$81,702
Level 2
Assets:
Short-term investments$294,702$235,853$94,691
Foreign currency exchange contracts19,4825,9806,702
Diesel fuel contracts1373,3721,698
Liabilities:
Foreign currency exchange contracts$6,107$11,874$4,217

The fair value of TJX’s general corporate debt, was estimated by obtaining market quotes given the trading levels of other bonds of the same general issuer type and market perceived credit quality. These inputs are considered to be Level 2. The fair value of long-term debt at February 1, 2014 was $1.34 billion compared to a carrying value of $1.27 billion. The fair value of long-term debt at February 2, 2013 was $911.0 million compared to a carrying value of $774.6 million. These estimates do not necessarily reflect provisions or restrictions in the various debt agreements that might affect TJX’s ability to settle these obligations.

TJX’s cash equivalents are stated at cost, which approximates fair value, due to the short maturities of these instruments.

Investments designed to meet obligations under the Executive Savings Plan are invested in securities traded in active markets and are recorded at unadjusted quoted prices.

Short-term investments, foreign currency exchange contracts and diesel fuel contracts are valued using broker quotations which include observable market information. TJX does not make adjustments to quotes or prices obtained from brokers or pricing services but does assess the credit risk of counterparties and will adjust final valuations when appropriate. Where independent pricing services provide fair values, TJX obtains an understanding of the methods used in pricing. As such, these instruments are classified within Level 2.

Note H. Segment Information

TJX operates four main business segments. The Marmaxx segment (T.J. Maxx, Marshalls and tjmaxx.com) and the HomeGoods segment both operate in the United States, the TJX Canada segment operates Winners, HomeSense and Marshalls in Canada, and the TJX Europe segment operates T.K. Maxx, HomeSense and tkmaxx.com in Europe. Late in fiscal 2013 TJX acquired STP, an off-price Internet retailer in the U.S. The results of STP are reported in the Marmaxx segment.

All of TJX’s stores, with the exception of HomeGoods and HomeSense, sell family apparel and home fashions. HomeGoods and HomeSense offer exclusively home fashions.

F-18

The percentages of our consolidated revenues by major product category for the last three fiscal years are as follows:

Fiscal 2014Fiscal 2013Fiscal 2012
Apparel
Clothing including footwear58%59%60%
Jewelry and accessories14%13%13%
Home fashions28%28%27%
Total100%100%100%

For fiscal 2014, TJX Canada and TJX Europe accounted for 24% of TJX’s net sales, 19% of segment profit and 24% of consolidated assets.

TJX evaluates the performance of its segments based on “segment profit or loss,” which it defines as pre-tax income or loss before general corporate expense and interest expense. “Segment profit or loss,” as defined by TJX, may not be comparable to similarly titled measures used by other entities. The terms “segment margin” or “segment profit margin” are used to describe segment profit or loss as a percentage of net sales. These measures of performance should not be considered alternatives to net income or cash flows from operating activities as an indicator of TJX’s performance or as a measure of liquidity.

Presented below is financial information with respect to TJX’s business segments:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Net sales:
In the United States
Marmaxx$17,929,576$17,011,409$15,367,519
HomeGoods2,993,7182,657,1112,243,986
A.J. Wright(1)——9,229
TJX Canada2,877,8342,925,9912,680,071
TJX Europe3,621,5683,283,8612,890,650
$27,422,696$25,878,372$23,191,455
Segment profit (loss):
In the United States
Marmaxx$2,612,693$2,486,274$2,073,430
HomeGoods386,541324,623234,445
A.J. Wright(1)——(49,291)
TJX Canada405,363414,914348,028
TJX Europe275,453215,71368,739
3,680,0503,441,5242,675,351
General corporate expense329,480334,998228,289
Interest expense, net31,08129,17535,648
Income before provision for income taxes$3,319,489$3,077,351$2,411,414

F-19

Business segment information (continued):

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Identifiable assets:
In the United States
Marmaxx$4,700,347$4,569,887$4,115,124
HomeGoods638,742569,476488,405
TJX Canada962,101978,577746,593
TJX Europe1,510,1321,261,5561,070,655
Corporate (2)2,389,7002,132,3591,860,828
$10,201,022$9,511,855$8,281,605
Capital expenditures:
In the United States
Marmaxx$551,839$590,307$458,720
HomeGoods99,82890,29177,863
TJX Canada104,888132,87492,846
TJX Europe190,123164,756173,901
$946,678$978,228$803,330
Depreciation and amortization:
In the United States
Marmaxx$318,414$293,820$289,921
HomeGoods47,17647,91537,881
TJX Canada66,29564,81059,112
TJX Europe114,65199,48796,370
Corporate (3)2,2872,8972,417
$548,823$508,929$485,701
(1)On December 8, 2010, the Board of Directors of TJX approved the consolidation of the A.J. Wright segment. All stores operating under the A.J. Wright banner closed by February 13, 2011 and the conversion process of certain stores to other banners was completed during the first quarter of fiscal 2012 (See Note C).
(2)Corporate identifiable assets consist primarily of cash, receivables, prepaid insurance, the trust assets in connection with the Executive Savings Plan and deferred taxes. Consolidated cash, including cash held in our foreign entities, is included with Corporate assets for consistency with the reporting of cash for our segments in the U.S.
(3)Includes debt discount accretion and debt expense amortization.

Note I. Stock Incentive Plan

TJX has a stock incentive plan under which options and other share-based awards may be granted to its directors, officers and key employees. This plan has been approved by TJX’s shareholders, and all share-based compensation awards are made under this plan. The Stock Incentive Plan, as amended with shareholder approval, has provided for the issuance of up to 347.8 million shares with 45.6 million shares available for future grants as of February 1, 2014. TJX issues shares under the plan from authorized but unissued common stock. All share amounts and per share data presented have been adjusted to reflect the two-for-one stock split effected in February 2012 (See Note A).

As of February 1, 2014, there was $115.1 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under the plan. That cost is expected to be recognized over a weighted-average period of two years.

Options for the purchase of common stock are granted at 100% of market price on the grant date and generally vest in thirds over a three-year period starting one year after the grant, and have a ten-year maximum term. When options are granted with other vesting terms (as in fiscal 2014, when certain options granted are scheduled to vest in full on the first anniversary of the grant date), such information is incorporated into the valuation.

F-20

The fair value of options is estimated as of the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions:

Fiscal Year Ended
February 1, 2014February 2, 2013January 28, 2012
Risk-free interest rate1.42%0.70%0.92%
Dividend yield1.0%1.0%1.4%
Expected volatility factor25.9%29.0%31.1%
Expected option life in years4.44.55.0
Weighted average fair value of options issued$11.92$10.28$6.55

The risk-free interest rate is for periods within the contractual life of the option based on the U.S. Treasury yield curve in effect at the time of grant. We use historical data to estimate option exercises, employee termination behavior and dividend yield within the valuation model. Expected volatility is based on a combination of implied volatility from traded options on our stock, and historical volatility during a term approximating the expected life of the option granted. The expected option life represents an estimate of the period of time options are expected to remain outstanding based upon historical exercise trends. Employee groups and option characteristics are considered separately for valuation purposes when applicable.

Stock Options: A summary of the status of TJX’s stock options and related weighted average exercise prices (“WAEP”) is presented below (shares in thousands):

Fiscal Year Ended
February 1, 2014February 2, 2013January 28, 2012
OptionsWAEPOptionsWAEPOptionsWAEP
(53 weeks)
Outstanding at beginning of year36,620$22.3140,944$18.2750,095$15.70
Granted4,74256.714,95145.097,92226.56
Exercised(8,258)17.71(8,385)15.90(15,433)13.98
Forfeitures(476)34.74(890)23.35(1,640)20.29
Outstanding at end of year32,628$28.3036,620$22.3140,944$18.27
Options exercisable at end of year22,473$20.1924,050$17.0224,540$15.04

The total intrinsic value of options exercised was $289.8 million in fiscal 2014, $223.8 million in fiscal 2013 and $210.9 million in fiscal 2012.

The following table summarizes information about stock options outstanding that were expected to vest and stock options outstanding that were exercisable as of February 1, 2014:

Shares in thousandsSharesAggregate Intrinsic ValueWeighted Average Remaining Contract LifeWAEP
Options outstanding expected to vest9,484$109,4438.8 years$45.82
Options exercisable22,473$835,2155.2 years$20.19
Total outstanding options vested and expected to vest31,957$944,6586.3 years$27.80

Options outstanding expected to vest represents total unvested options of 10.2 million adjusted for anticipated forfeitures.

Performance-Based Restricted Stock and Performance-Based Deferred Stock Awards: TJX issues performance-based restricted stock and performance-based deferred stock awards (collectively, “performance-based stock awards”) under the Stock Incentive Plan. These awards are granted without a purchase price to the recipient and are

F-21

subject to vesting conditions, including specified performance criteria for a period generally of one to three years. The grant date fair value of the award is charged to income over the requisite service period during which the recipient must remain employed. The fair value of the awards is determined at date of grant in accordance with ASC Topic 718 and assumes that performance goals will be achieved. If such goals are not met, or only partially met, awards and related compensation costs recognized are reduced on a pro rata basis.

A summary of the status of our nonvested performance-based stock awards and changes during fiscal 2014 is presented below:

Shares in thousandsRestricted and Deferred AwardsWeighted Average Grant Date Fair Value
Nonvested at beginning of year1,677$31.45
Granted74451.02
Vested(586)24.26
Forfeited(29)30.86
Nonvested at end of year1,806$41.85

There were 743,576 shares of performance-based stock awards, with a weighted average grant date fair value of $51.02, granted in fiscal 2014, 730,500 shares of performance-based stock awards, with a weighted average grant date fair value of $41.74, granted in fiscal 2013 and 298,500 shares of performance-based stock awards, with a weighted average grant date fair value of $24.81, granted in fiscal 2012. The fair value of performance-based stock awards that vested was $14.2 million in fiscal 2014, $9.7 million in fiscal 2013 and $10.0 million in fiscal 2012. In fiscal 2013, TJX also awarded 281,076 shares of performance-based restricted stock which were not recognized under ASC Topic 718 as granted during fiscal 2013 because all of the applicable performance terms had not been established during the fiscal year. These shares were recognized as having been granted in fiscal 2014.

Other Awards: TJX also awards deferred shares to its outside directors under the Stock Incentive Plan. The outside directors are awarded two annual deferred share awards, each representing shares of TJX common stock valued at $70,000. One award vests immediately and is payable, with accumulated dividends, in stock at the earlier of separation from service as a director or a change of control. The second award vests based on service as a director until the annual meeting that follows the award and is payable, with accumulated dividends, in stock following the vesting date, unless an irrevocable advance election is made whereby it is payable at the same time as the first award. As of the end of fiscal 2014, a total of 269,405 of these deferred shares were outstanding under the plan.

Note J. Pension Plans and Other Retirement Benefits

Pension: TJX has a funded defined benefit retirement plan that covers a majority of its full-time U.S. employees hired prior to February 1, 2006. No employee contributions are required, or permitted, and benefits are based principally on compensation earned in each year of service. TJX’s funded defined benefit retirement plan assets are invested in domestic and international equity and fixed income securities, both directly and through investment funds. The plan does not invest in TJX securities. TJX also has an unfunded supplemental retirement plan that covers certain key employees and provides additional retirement benefits based on final average compensation for certain of those employees (the primary benefit) or, alternatively, based on benefits that would be provided under the funded retirement plan absent Internal Revenue Code limitations (the alternative benefit).

F-22

Presented below is financial information relating to TJX’s funded defined benefit pension plan (qualified pension plan or funded plan) and its unfunded supplemental pension plan (unfunded plan) for the fiscal years indicated:

Funded Plan Fiscal Year EndedUnfunded Plan Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013February 1, 2014February 2, 2013
(53 weeks)(53 weeks)
Change in projected benefit obligation:
Projected benefit obligation at beginning of year$1,018,712$850,687$61,033$53,351
Service cost44,62341,8131,7161,448
Interest cost44,65442,0292,4472,321
Correction of prior years pension accruals—33,788——
Actuarial losses (gains)(84,970)70,438(2,925)6,666
Benefits paid(23,431)(17,989)(2,705)(2,753)
Expenses paid(2,620)(2,054)——
Projected benefit obligation at end of year$996,968$1,018,712$59,566$61,033
Accumulated benefit obligation at end of year$921,723$939,905$49,957$49,879
Funded Plan Fiscal Year EndedUnfunded Plan Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013February 1, 2014February 2, 2013
(53 weeks)(53 weeks)
Change in plan assets:
Fair value of plan assets at beginning of year$876,083$750,797$—$—
Actual return on plan assets64,76970,329——
Employer contribution30,00075,0002,7052,753
Benefits paid(23,431)(17,989)(2,705)(2,753)
Expenses paid(2,620)(2,054)——
Fair value of plan assets at end of year$944,801$876,083$—$—
Reconciliation of funded status:
Projected benefit obligation at end of year$996,968$1,018,712$59,566$61,033
Fair value of plan assets at end of year944,801876,083——
Funded status – excess obligation$52,167$142,629$59,566$61,033
Net liability recognized on consolidated balance sheets$52,167$142,629$59,566$61,033
Amounts not yet reflected in net periodic benefit cost and included in accumulated other comprehensive income (loss):
Prior service cost$—$—$2$5
Accumulated actuarial losses205,923323,25811,79217,601
Amounts included in accumulated other comprehensive income (loss)$205,923$323,258$11,794$17,606

The consolidated balance sheets reflect the funded status of the plans with any unrecognized prior service cost and actuarial gains and losses recorded in accumulated other comprehensive income (loss). The combined net accrued liability of $111.7 million at February 1, 2014 is reflected on the balance sheet as of that date as a current liability of $3.4 million and a long-term liability of $108.3 million.

The combined net accrued liability of $203.7 million at February 2, 2013 is reflected on the balance sheet as of that date as a current liability of $2.4 million and a long-term liability of $201.3 million.

The estimated prior service cost that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in fiscal 2015 for both the funded and unfunded plan is immaterial. The estimated net actuarial loss that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in fiscal 2015 is $13.0 million for the funded plan and $1.2 million for the unfunded plan.

F-23

TJX determined the assumed discount rate using the BOND: Link model in fiscal 2014 and the RATE: Link model in fiscal 2013. TJX changed to the BOND: Link model as this model allows for the selection of specific bonds resulting in better matches in timing of the plans expected cash flows. Presented below are weighted average assumptions for measurement purposes for determining the obligation at the year-end measurement date:

Funded Plan Fiscal Year EndedUnfunded Plan Fiscal Year Ended
February 1, 2014February 2, 2013February 1, 2014February 2, 2013
Discount rate5.00%4.40%4.80%4.00%
Rate of compensation increase4.00%4.00%6.00%6.00%

TJX made aggregate cash contributions of $32.7 million in fiscal 2014, $77.8 million in fiscal 2013 and $78.4 million in fiscal 2012 to the funded plan and to fund current benefit and expense payments under the unfunded plan. TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded status of 80% of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section 430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under the Internal Revenue Code. We do not anticipate any required funding in fiscal 2015 for the funded plan. We anticipate making contributions of $3.4 million to provide current benefits coming due under the unfunded plan in fiscal 2015.

The following are the components of net periodic benefit cost and other amounts recognized in other comprehensive income related to our pension plans:

Funded Plan Fiscal Year EndedUnfunded Plan Fiscal Year Ended
Dollars in thousandsFebruary 1, 2014February 2, 2013January 28, 2012February 1, 2014February 2, 2013January 28, 2012
(53 weeks)(53 weeks)
Net periodic pension cost:
Service cost$44,623$41,813$33,858$1,716$1,448$1,188
Interest cost44,65442,02938,5672,4472,3212,410
Expected return on plan assets(60,474)(54,759)(49,059)———
Amortization of prior service cost———334
Amortization of net actuarial loss28,07025,37310,8542,8841,465666
Expense related to current period56,87354,45634,2207,0505,2374,268
Correction of prior years pension accruals—26,964————
Total expense$56,873$81,420$34,220$7,050$5,237$4,268
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Net (gain) loss$(89,265)$61,692$148,759$(2,925)$6,666$3,582
Amortization of net (loss)(28,070)(25,373)(10,854)(2,884)(1,465)(666)
Amortization of prior service cost———(3)(3)(4)
Total recognized in other comprehensive income$(117,335)$36,319$137,905$(5,812)$5,198$2,912
Total recognized in net periodic benefit cost and other comprehensive income$(60,462)$117,739$172,125$1,238$10,435$7,180
Weighted average assumptions for expense purposes:
Discount rate4.40%4.80%5.75%4.00%4.40%5.25%
Expected rate of return on plan assets7.00%7.40%7.50%N/AN/AN/A
Rate of compensation increase4.00%4.00%4.00%6.00%6.00%6.00%

F-24

The rate of compensation increase presented for the unfunded plan (for measurement purposes and expense purposes) is the rate assumed for participants eligible for the primary benefit. The assumed rate of compensation increase for participants eligible for the alternative benefit under the unfunded plan is the same rate as assumed for the funded plan.

During fiscal 2013, TJX recorded an adjustment to its pension accrual to correct an understatement related to a computational error that commenced in fiscal 2008. The cumulative impact through fiscal 2012 of correcting for the error resulted in incremental pension expense of $27.0 million and an increase in the projected benefit obligation of $33.8 million. Management evaluated the impact of correcting the error in fiscal 2013 and determined that there was no material impact on that year, or the prior year financial statements as reported.

TJX develops its long-term rate of return assumption by evaluating input from professional advisors taking into account the asset allocation of the portfolio and long-term asset class return expectations, as well as long-term inflation assumptions.

The unrecognized gains and losses in excess of 10% of the projected benefit obligation are amortized over the average remaining service life of participants. In addition, for the unfunded plan, unrecognized actuarial gains and losses that exceed 30% of the projected benefit obligation are fully recognized in net periodic pension cost.

The following is a schedule of the benefits expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter:

In thousandsFunded Plan Expected Benefit PaymentsUnfunded Plan Expected Benefit Payments
Fiscal Year
2015$26,650$3,395
201629,6672,418
201733,0454,513
201836,9704,591
201940,9524,735
2020 through 2024268,31421,163

The following table presents the fair value hierarchy (See Note G) for pension assets measured at fair value on a recurring basis as of February 1, 2014:

Funded Plan
In thousandsLevel 1Level 2Level 3Total
Asset category:
Short-term investments$57,217$—$—$57,217
Equity Securities:
Domestic equity74,415——74,415
International equity150,149——150,149
Fixed Income Securities:
Corporate and government bond funds—214,752—214,752
Futures Contracts—202—202
Common/Collective Trusts—429,93210,421440,353
Limited Partnerships——7,7137,713
Fair value of plan assets$281,781$644,886$18,134$944,801

F-25

The following table presents the fair value hierarchy for pension assets measured at fair value on a recurring basis as of February 2, 2013:

Funded Plan
In thousandsLevel 1Level 2Level 3Total
Asset category:
Short-term investments$144,008$—$—$144,008
Equity Securities:
Domestic equity65,105——65,105
International equity61,944——61,944
Fixed Income Securities:
Corporate and government bond funds—203,931—203,931
Common/Collective Trusts—376,87313,158390,031
Limited Partnerships——11,06411,064
Fair value of plan assets$271,057$580,804$24,222$876,083

The following table presents a reconciliation of Level 3 plan assets measured at fair value for the years ended February 1, 2014 and February 2, 2013:

In thousandsCommon/Collective TrustsLimited Partnerships
Balance as of January 28, 2012$14,775$12,042
Earned income, net of management expenses1,258348
Unrealized gain on investment39595
Purchases, sales, issuances and settlements, net(2,914)(1,921)
Balance as of February 2, 2013$13,158$11,064
Earned income, net of management expenses671312
Unrealized gain on investment676507
Purchases, sales, issuances and settlements, net(4,084)(4,170)
Balance as of February 1, 2014$10,421$7,713

Pension plan assets are reported at fair value. Investments in equity securities traded on a national securities exchange are valued at the composite close price, as reported in the Wall Street Journal, as of the financial statement date. This information is provided by the independent pricing sources.

Certain corporate and government bonds are valued at the closing price reported in the active market in which the bond is traded. Other bonds are valued based on yields currently available on comparable securities of issuers with similar credit ratings. When quoted prices are not available for identical or similar bonds, the bond is valued under a discounted cash flow approach that maximizes observable inputs, such as current yields of similar instruments, but includes adjustments for certain risks that may not be observable, such as credit and liquidity risks. All bonds are priced by independent pricing sources.

The investments in the limited partnerships are stated at the fair value of the plan’s partnership interest based on information supplied by the partnerships as compared to financial statements of the limited partnership or other fair value information as determined by management. Any cash equivalents or short-term investments are stated at cost which approximates fair value. The fair value of the investments in the common/collective trusts is determined based on net asset value as reported by their fund managers.

The following is a summary of TJX’s target allocation for plan assets along with the actual allocation of plan assets as of the valuation date for the fiscal years presented:

Actual Allocation for Fiscal Year Ended
Target AllocationFebruary 1, 2014February 2, 2013
Equity securities50%51%46%
Fixed income50%44%44%
All other – primarily cash—5%10%

F-26

TJX employs a total return investment approach whereby a mix of equities and fixed income investments is used to seek to maximize the long-term return on plan assets with a prudent level of risk. Risks are sought to be mitigated through asset diversification and the use of multiple investment managers. Investment risk is measured and monitored on an ongoing basis through quarterly investment portfolio reviews, annual liability measurements and periodic asset/liability studies.

TJX also sponsors an employee savings plan under Section 401(k) of the Internal Revenue Code for all eligible U.S. employees and a similar type plan for eligible employees in Puerto Rico. Assets under the plans totaled $1,137.3 million as of December 31, 2013 and $903.7 million as of December 31, 2012 and are invested in a variety of funds. Employees may contribute up to 50% of eligible pay, subject to limitation. TJX matches employee contributions, up to 5% of eligible pay, including a basic match at rates between 25% and 75% (based upon date of hire and other eligibility criteria) plus a discretionary match, generally up to 25%, based on TJX’s performance. Eligible employees are automatically enrolled in the U.S. plan at a 2% deferral rate, unless the employee elects otherwise. TJX contributed $29.7 million in fiscal 2014, $16.1 million in fiscal 2013 and $11.8 million in fiscal 2012 to these employee savings plans. Employees cannot invest their contributions in the TJX stock fund option in the plans, and may elect to invest no more than 50% of TJX’s contribution in the TJX stock fund. The TJX stock fund represents 8.3% of plan investments at December 31, 2013, 7.2% of plan investments at December 31, 2012 and 6.6% at December 31, 2011. In addition, TJX also maintained a 401(k) plan for eligible associates of Sierra Trading Post. Assets under this plan totaled $13.4 million through December 31, 2013, all of which had been transferred to the TJX 401(k) Plan as of January 1, 2014.

TJX also has a nonqualified savings plan for certain U.S. employees. TJX matches employee deferrals at various rates which amounted to $2.4 million in fiscal 2014, $4.0 million in fiscal 2013 and $2.6 million in fiscal 2012. Although the plan is unfunded, in order to help meet its future obligations TJX transfers an amount generally equal to employee deferrals and the related company match to a separate “rabbi” trust. The trust assets, which are invested in a variety of mutual funds, are included in other assets on the balance sheets.

In addition to the plans described above, TJX also maintains retirement/deferred savings plans for eligible associates at its foreign subsidiaries. We contributed $8.1 million for these plans in fiscal 2014, $7.1 million in fiscal 2013 and $5.8 million in fiscal 2012.

Multiemployer Pension Plans: TJX contributes to the National Retirement Fund (EIN #13-6130178), a multiemployer defined benefit pension plan under the terms of collective-bargaining agreements that cover union-represented employees. TJX contributed $11.5 million in fiscal 2014, $10.9 million in fiscal 2013 and $10.8 million in fiscal 2012 to the fund. TJX was listed in the plan’s Form 5500 as providing more than 5% of the total contributions for the plan year ending December 31, 2012. The Pension Protection Act Zone Status of the plan is Critical and a rehabilitation plan has been implemented.

Postretirement Medical: TJX has an unfunded postretirement medical plan that provides limited postretirement medical and life insurance benefits to retirees who participate in its retirement plan and who retired at age 55 or older with ten or more years of service. During fiscal 2006, TJX eliminated this benefit for all active associates and modified the benefit to cover only retirees enrolled in the plan at that time.

TJX paid $184,000 of benefits in fiscal 2014 and will pay similar amounts over the next several years. The postretirement medical liability as of February 1, 2014 is estimated at $1.2 million, all of which is included in non-current liabilities on the balance sheet.

The amendment to plan benefits in fiscal 2006 resulted in a negative plan amendment of $46.8 million which is being amortized into income over the average remaining life of the active plan participants. The unamortized balance of $12.8 million as of February 1, 2014 is included in accumulated other comprehensive income (loss) of which approximately $3.5 million will be amortized into income in fiscal 2015. During fiscal 2014, there was a pre-tax net benefit of $3.5 million reflected in the consolidated statements of income as it relates to this postretirement medical plan.

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Note K. Long-Term Debt and Credit Lines

The table below presents long-term debt, exclusive of current installments, as of February 1, 2014 and February 2, 2013. All amounts are net of unamortized debt discounts.

In thousandsFebruary 1, 2014February 2, 2013
General corporate debt:
4.20% senior unsecured notes, maturing August 15, 2015 (effective interest rate of 4.20% after reduction of unamortized debt discount of $8 and $13 in fiscal 2014 and 2013, respectively)$399,992$399,987
6.95% senior unsecured notes, maturing April 15, 2019 (effective interest rate of 6.98% after reduction of unamortized debt discount of $364 and $435 in fiscal 2014 and 2013, respectively)374,636374,565
2.50% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $412 in fiscal 2014)499,588—
Long-term debt, exclusive of current installments$1,274,216$774,552

The aggregate maturities of long-term debt, exclusive of current installments at February 1, 2014 are as follows:

In thousandsLong-Term Debt
Fiscal Year
2016$400,000
2017—
2018—
2019—
Later years875,000
Less amount representing unamortized debt discount(784)
Aggregate maturities of long-term debt, exclusive of current installments$1,274,216

At February 1, 2014, TJX had outstanding $375 million aggregate principal amount of 6.95% ten-year notes due April 2019, $400 million aggregate principal amount of 4.20% six-year notes due August 2015 and $500 million 2.50% ten-year notes due May 2023. TJX entered into rate-lock agreements to hedge the underlying treasury rate of all of the 6.95% notes and $250 million of the 4.20% notes prior to the issuance of the notes. The costs of these agreements are being amortized to interest expense over the term of the respective notes, resulting in an effective fixed interest rate of 7.00% for the 6.95% notes and 4.19% for the 4.20% notes. TJX entered into rate-lock agreements to hedge $250 million of the 2.50% notes prior to their issuance. The costs of these agreements are being amortized to interest expense over the term of the notes, resulting in an effective fixed interest rate of 2.57%.

At February 1, 2014, TJX had two $500 million revolving credit facilities, one which matures in June 2017 and one which matures in May 2016. As of February 1, 2014 and February 2, 2013 and during the years then ended, there were no amounts outstanding under these facilities. At February 1, 2014 the agreements require quarterly payments on the unused committed amounts of 8.0 basis points for the agreement maturing in 2017 and 12.5 basis points for the agreement maturing in 2016. These rates are based on the credit ratings of TJX’s long-term debt and would vary with changes in the credit ratings. These agreements have no compensating balance requirements and have various covenants including a requirement of a specified ratio of debt to earnings. Each of these facilities requires TJX to maintain a ratio of funded debt and four-times consolidated rentals to consolidated earnings before interest, taxes, consolidated rentals, depreciation and amortization (“EBITDAR”) of not more than 2.75 to 1.0 on a rolling four-quarter basis. The term “EBITDAR” which includes certain adjustments, is defined in the facility agreements previously filed with the Securities and Exchange Commission. TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented.

As of February 1, 2014 and February 2, 2013, TJX’s foreign subsidiaries had uncommitted credit facilities. TJX Canada had two credit lines, a C$10 million facility for operating expenses and a C$10 million letter of credit facility.

F-28

As of February 1, 2014 and February 2, 2013, and during the years then ended there were no amounts outstanding on the Canadian credit line for operating expenses. As of February 1, 2014 and February 2, 2013, TJX Europe had a credit line of £20 million. The maximum amount outstanding under this U.K. line was £7.3 million in fiscal 2013 and there were no borrowings under this credit line in fiscal 2014. There were no amounts outstanding under this U.K. credit line at the end of fiscal 2014 or fiscal 2013.

Note L. Income Taxes

The provision for income taxes includes the following:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Current:
Federal$815,811$842,149$554,847
State177,009162,200126,237
Foreign136,626153,08399,463
Deferred:
Federal73,20622,394131,527
State5,9281,5836,202
Foreign(26,487)(10,745)(2,952)
Provision for income taxes$1,182,093$1,170,664$915,324

Income from continuing operations before income taxes includes foreign pre-tax income of $572.6 million in fiscal 2014, $559.7 million in fiscal 2013 and $319.4 million in fiscal 2012.

TJX had net deferred tax (liabilities) assets as follows:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013
Deferred tax assets:
Net operating loss carryforwards$25,711$33,461
Reserve for former operations24,60321,856
Pension, stock compensation, postretirement and employee benefits280,381313,671
Leases43,96640,440
Computer Intrusion reserve4,5055,661
Other66,98464,394
Total gross deferred tax assets446,150479,483
Valuation allowance(4,359)(35,941)
Net deferred tax assets$441,791$443,542
Deferred tax liabilities:
Property, plant and equipment$432,262$360,167
Capitalized inventory48,61247,903
Tradename / Intangibles45,52843,520
Undistributed foreign earnings217,916233,002
Other10,39712,217
Total deferred tax liabilities$754,715$696,809
Net deferred tax (liability)$(312,924)$(253,267)

The fiscal 2014 net deferred tax liability is presented on the balance sheet as a current asset of $101.6 million and a non-current asset of $31.5 million and a non-current liability of $446.1 million. The fiscal 2013 net deferred tax liability is presented on the balance sheet as a current asset of $96.2 million and a non-current liability of $349.5 million.

F-29

TJX has provided for deferred U.S. taxes on all undistributed earnings through February 1, 2014 from its subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong, and Australia. For all other foreign subsidiaries, no income taxes have been provided on the approximately $528.2 million of undistributed earnings as of February 1, 2014 because such earnings are considered to be indefinitely reinvested in the business. A determination of the amount of unrecognized deferred tax liability related to the undistributed earnings is not practicable because of the complexities associated with the hypothetical calculations.

As of February 1, 2014, and February 2, 2013, the Company had available for state income tax purposes net operating loss carryforwards of $35.9 million which expire, if unused, in the years 2015 through 2033. The Company has analyzed the realization of the state net operating loss carryforwards on an individual state basis. For those states where the Company has determined that it is more likely than not that the state net operating loss carryforwards will not be realized, a valuation allowance has been provided for the deferred tax asset as of February 1, 2014, and February 2, 2013 in the amount of $4.4 million and $4.6 million respectively.

As of February 1, 2014, the Company had available for foreign tax purposes (primarily related to Germany and Poland) net operating loss carryforwards of $77.1 million of which $7.6 million expire, if unused, in the years 2015 through 2018 and the remaining loss carryforwards do not expire. As of February 2, 2013, the Company had available for foreign tax purposes (primarily related to Germany and Poland) net operating loss carryforwards of $108.3 million.

As of February 1, 2014, the Company determined that it is more-likely-than-not that it will realize the deferred tax assets and reversed the valuation allowance previously recorded. As of February 2, 2013, the Company determined that it was more-likely-than-not that all of the net operating loss carryforwards would not be realized and a valuation allowance had been provided for the net deferred tax assets in the amount of $31.3 million.

In making the assessment to reverse the valuation allowances, TJX considered and weighed all available evidence, both positive and negative. The positive and negative evidence includes the entity’s history of losses, recent profitability, and projections of future income. During fiscal 2014 it became evident that the foreign entities, which had a history of losses prior to fiscal 2013, continued to be profitable and that reversal of the valuation allowance was appropriate.

TJX’s worldwide effective income tax rate was 35.6% for fiscal 2014, 38.0% for fiscal 2013 and 38.0% for fiscal 2012. The difference between the U.S. federal statutory income tax rate and TJX’s worldwide effective income tax rate is reconciled below:

Fiscal Year Ended
February 1, 2014February 2, 2013January 28, 2012
(53 weeks)
U.S. federal statutory income tax rate35.0%35.0%35.0%
Effective state income tax rate3.63.53.6
Impact of foreign operations(0.8)(0.3)(0.2)
All other(2.2)(0.2)(0.4)
Worldwide effective income tax rate35.6%38.0%38.0%

TJX’s effective income tax rate decreased for fiscal 2014 as compared to fiscal 2013. The fiscal 2014 effective income tax rate decreased primarily due to fiscal 2014 third quarter tax benefits of approximately $80 million, primarily due to a reduction in our reserve for uncertain tax positions as a result of settlements with state taxing authorities and the reversal of valuation allowances against foreign net operating loss carryforwards. These benefits reduced our year-to-date effective income tax rate by 1.4 percentage points and 0.8 percentage points respectively.

TJX had net unrecognized tax benefits, net of federal benefit on state issues, of $26.2 million as of February 1, 2014, $125.3 million as of February 2, 2013 and $116.6 million as of January 28, 2012. During the third quarter of fiscal 2014, the net reserve for uncertain tax positions was reduced by $104 million as a result of a settlement with state taxing authorities. The remainder of the change in the reserve during fiscal 2014 is due to various additions for uncertain tax positions taken in the current and prior years, reductions resulting from the lapse of statutes of limitations and other settlements with taxing authorities.

F-30

A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
Balance at beginning of year$148,777$144,505$123,094
Additions for uncertain tax positions taken in current year4,2121,9491,131
Additions for uncertain tax positions taken in prior years5,0963,00963,463
Reductions for uncertain tax positions taken in prior years(69,292)—(40,558)
Reductions resulting from lapse of statute of limitations(317)(129)—
Settlements with tax authorities(39,796)(557)(2,625)
Balance at end of year$48,680$148,777$144,505

Included in the gross amount of unrecognized tax benefits are items that will not impact future effective tax rates upon recognition. These items amounted to $20.8 million as of February 1, 2014, $19.8 million as of February 2, 2013 and $20.0 million as of January 28, 2012.

TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In nearly all jurisdictions, the tax years through fiscal 2006 are no longer subject to examination.

TJX’s accounting policy is to classify interest and penalties related to income tax matters as part of income tax expense. The amount of interest and penalties expensed was $4.0 million for the year ended February 1, 2014, $4.7 million for the year ended February 2, 2013 and $5.8 million for the year ended January 28, 2012. The accrued amounts for interest and penalties are $8.1 million as of February 1, 2014, $38.6 million as of February 2, 2013 and $33.0 million as of January 28, 2012.

Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statute of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those represented on the financial statements as of February 1, 2014. During the next twelve months, it is reasonably possible that such circumstances may occur that would have a material effect on previously unrecognized tax benefits. As a result, the total net amount of unrecognized tax benefits may decrease, which would reduce the provision for taxes on earnings by a range estimated at $0 million to $10.4 million.

On September 13, 2013 the U.S. Department of the Treasury and Internal Revenue Service released final tangible property regulations that provide guidance on the tax treatment regarding the deduction and capitalization of expenditures related to tangible property. While early adoption is available, the effective date to implement these regulations is for tax years beginning on or after January 1, 2014. The Company is currently assessing these rules and the impact to its financial statements, if any, but believes adoption of these regulations will not have a material impact on its consolidated results of operations, cash flows or financial position.

Note M. Commitments

TJX is committed under long-term leases related to its continuing operations for the rental of real estate and fixtures and equipment. Most of TJX’s leases are store operating leases with ten-year terms and options to extend for one or more five-year periods in the U.S. and Canada and ten to fifteen year terms with options to end the lease after five or ten-years in Europe. Many of the Company’s leases contain escalation clauses and some contain early termination penalties. In addition, TJX is generally required to pay insurance, real estate taxes and other operating expenses including, in some cases, rentals based on a percentage of sales. These expenses in the aggregate were approximately one-third of the total minimum rent in fiscal 2014, fiscal 2013 and fiscal 2012 and are not included in the table below.

F-31

The following is a schedule of future minimum lease payments for continuing operations as of February 1, 2014:

In thousandsOperating Leases
Fiscal Year
2015$1,272,948
20161,182,809
20171,038,912
2018885,594
2019742,321
Later years2,268,804
Total future minimum lease payments$7,391,388

Rental expense under operating leases for continuing operations amounted to $1,238.2 million for fiscal 2014, $1,171.6 million for fiscal 2013 and $1,086.0 million for fiscal 2012. Rental expense includes contingent rent and is reported net of sublease income. Contingent rent paid was $15.7 million in fiscal 2014, $15.0 million in fiscal 2013 and $12.9 million in fiscal 2012. Sublease income was $0.9 million in fiscal 2014 and in fiscal 2013 and $1.3 million in fiscal 2012. The total net present value of TJX’s minimum operating lease obligations approximated $6,317.4 million as of February 1, 2014.

TJX had outstanding letters of credit totaling $55.3 million as of February 1, 2014 and $48.5 million as of February 2, 2013. Letters of credit are issued by TJX primarily for the purchase of inventory.

Note N. Accrued Expenses and Other Liabilities, Current and Long Term

The major components of accrued expenses and other current liabilities are as follows:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013
Employee compensation and benefits, current$479,003$513,999
Computer Intrusion reserve12,85415,767
Reserve for former operations – short term14,58617,648
Rent, utilities and occupancy, including real estate taxes179,953177,693
Merchandise credits and gift certificates246,438218,488
Insurance34,36431,423
Sales tax collections and V.A.T. taxes102,572109,874
All other current liabilities612,064581,324
Accrued expenses and other current liabilities$1,681,834$1,666,216

All other current liabilities include accruals for advertising, property additions, dividends, freight, interest, reserve for sales returns, expense payables, purchased services and other items, each of which is individually less than 5% of current liabilities.

The major components of other long-term liabilities are as follows:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013
Employee compensation and benefits, long term$334,847$395,282
Reserve for former operations – long term16,77727,581
Accrued rent195,586164,593
Landlord allowances106,15194,570
Tax reserve, long term50,227257,190
All other long-term liabilities29,41122,068
Other long-term liabilities$732,999$961,284

F-32

Note O. Contingent Obligations and Contingencies

Contingent Obligations: TJX has contingent obligations on leases, for which it was a lessee or guarantor, which were assigned to third parties without TJX being released by the landlords. Over many years, TJX has assigned numerous leases that we originally leased or guaranteed to a significant number of third parties. With the exception of leases of former businesses for which TJX has reserved, we have rarely had a claim with respect to assigned leases, and accordingly, we do not expect that such leases will have a material adverse impact on our financial condition, results of operations or cash flows. TJX does not generally have sufficient information about these leases to estimate our potential contingent obligations under them, which could be triggered in the event that one or more of the current tenants does not fulfill their obligations related to one or more of these leases.

TJX also has contingent obligations in connection with certain assigned or sublet properties that TJX is able to estimate. We estimate that the undiscounted obligations of (i) leases of former operations not included in our reserve for former operations and (ii) properties of our former operations if the subtenants do not fulfill their obligations, are approximately $95 million as of February 1, 2014. We believe that most or all of these contingent obligations will not revert to us and, to the extent they do, will be resolved for substantially less due to mitigating factors including our expectation to further sublet.

TJX is a party to various agreements under which it may be obligated to indemnify the other party with respect to breach of warranty or losses related to such matters as title to assets sold, specified environmental matters or certain income taxes. These obligations are typically limited in time and amount. There are no amounts reflected in our balance sheets with respect to these contingent obligations.

Contingencies: TJX is subject to certain legal proceedings, lawsuits, disputes and claims that arise from time to time in the ordinary course of our business. In addition, TJX is a defendant in several lawsuits filed in federal and state courts brought as putative class or collective actions on behalf of various groups of current and former salaried and hourly associates in the U.S. The lawsuits allege violations of the Fair Labor Standards Act and of state wage and hour and other labor statutes, including alleged misclassification of positions as exempt from overtime, alleged entitlement to additional wages for alleged off-the-clock work by hourly employees and alleged failure to pay all wages due upon termination. The lawsuits are in various procedural stages and seek unspecified monetary damages, injunctive relief and attorneys’ fees. At this time, TJX is not able to predict the outcome of these lawsuits or the amount of any loss that may arise from them.

Note P. Supplemental Cash Flows Information

The cash flows required to satisfy obligations of former operations discussed in Note C are classified as a reduction in cash provided by operating activities. There are no remaining operating activities relating to these operations.

TJX’s cash payments for interest and income taxes and non-cash investing and financing activities are as follows:

Fiscal Year Ended
In thousandsFebruary 1, 2014February 2, 2013January 28, 2012
(53 weeks)
Cash paid for:
Interest on debt$52,196$45,653$46,691
Income taxes1,240,377971,732781,170
Changes in accrued expenses due to:
Dividends payable$19,380$12,291$13,018
Property additions(6,432)33,615(23,746)

There were no non-cash financing or investing activities during fiscal 2014, 2013 or 2012.

F-33

Note Q. Selected Quarterly Financial Data (Unaudited)

Presented below is selected quarterly consolidated financial data for fiscal 2014 and fiscal 2013 which was prepared on the same basis as the audited consolidated financial statements and includes all adjustments necessary to present fairly, in all material respects, the information set forth therein on a consistent basis.

In thousands except per share amountsFirst QuarterSecond QuarterThird QuarterFourth Quarter(2)
Fiscal Year Ended February 1, 2014 (52 weeks)
Net sales$6,189,609$6,442,424$6,981,876$7,808,787
Gross earnings(1)1,756,0761,855,6852,047,4112,158,487
Net income452,890479,559622,655582,292
Basic earnings per share0.630.670.880.82
Diluted earnings per share0.620.660.860.81
Fiscal Year Ended February 2, 2013 (53 weeks)
Net sales$5,798,086$5,945,559$6,410,913$7,723,814
Gross earnings(1)1,632,3581,670,4861,844,8402,209,288
Net income419,200421,092461,551604,844
Basic earnings per share0.560.570.630.83
Diluted earnings per share0.550.560.620.82
(1)Gross earnings equal net sales less cost of sales, including buying and occupancy costs.
(2)The fourth quarter of fiscal 2013 included 14 weeks.

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