Item 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 thousands		Balance Beginning of Period				Amounts Charged to Net Income				Write-Offs Against Reserve				Balance End of Period
Sales Return Reserve:
Fiscal Year Ended January 30, 2016		$	35,476			$	1,497,963			$	1,491,716			$	41,723
Fiscal Year Ended January 31, 2015		$	37,429			$	1,348,933			$	1,350,886			$	35,476
Fiscal Year Ended February 1, 2014		$	36,618			$	1,667,466			$	1,666,655			$	37,429
Casualty Insurance Reserve:
Fiscal Year Ended January 30, 2016		$	14,303			$	80,738			$	75,355			$	19,686
Fiscal Year Ended January 31, 2015		$	14,696			$	72,604			$	72,997			$	14,303
Fiscal Year Ended February 1, 2014		$	14,632			$	71,093			$	71,029			$	14,696

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).1		Fourth 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).1		By-laws of TJX, as amended, are incorporated herein by reference to Exhibit 3.1 to the Form 8-K filed on September 22, 2009.
4.1		Indenture between TJX and U.S. Bank National Association dated as of April 2, 2009 is incorporated herein by reference to Exhibit 4.1 of the Registration Statement on Form S-3 filed on April 2, 2009 (File 333-158360).
4.2		First Supplemental Indenture between TJX and U.S. Bank National Association dated as of April 7, 2009 is incorporated herein by reference to Exhibit 4.1 to the Form 8-K filed on April 7, 2009.
4.3		Second Supplemental Indenture between TJX and U.S. Bank National Association dated as of July 23, 2009 is incorporated herein by reference to Exhibit 4.1 to the Form 8-K filed on July 23, 2009.
4.4		Third 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, is incorporated herein by reference to Exhibit 4.2 to the Form 8-K filed on May 2, 2013.
4.5		Fourth Supplemental Indenture dated as of June 5, 2014 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, is incorporated herein by reference to Exhibit 4.2 to the Form 8-K filed on June 5, 2014.
10.1		The Amended and Restated Employment Agreement dated January 29, 2016 between Carol Meyrowitz and TJX is filed herewith.*
10.2		The Amended and Restated Employment Agreement dated January 29, 2016 between Ernie Herrman and TJX is filed herewith.*
10.3		The Employment Agreement dated January 31, 2014 between and among Michael MacMillan, NBC Attire, Inc. and TJX is incorporated herein by reference to Exhibit 10.5 to the Form 10-K filed for the year ended February 1, 2014. The Letter Agreement dated March 30, 2015 between and among Michael MacMillan, NBC Attire, Inc. and TJX is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended May 2, 2015.*
10.4		The Employment Agreement dated January 30, 2015 between Richard Sherr and TJX is incorporated herein by reference to Exhibit 10.7 to the Form 10-K filed for the fiscal year ended January 31, 2015.*
10.5		The Employment Agreement dated January 30, 2015 between Scott Goldenberg and TJX is incorporated herein by reference to Exhibit 10.8 to the Form 10-K filed for the fiscal year ended January 31, 2015.*
10.6		The Employment Agreement dated as of September 29, 2014 between Kenneth Canestrari and TJX is incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed for the quarter ended November 1, 2014.*
10.7		The 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.*
10.8		The 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.*
10.9		The 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.*

10.10		The 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.*
10.11		The 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.*
10.12		The 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.*
10.13		The 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.*
10.14		The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 10, 2014 is incorporated herein by reference to Exhibit 10.4 to the Form 10-Q filed for the quarter ended November 1, 2014. The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 10, 2014 is incorporated herein by reference to Exhibit 10.5 to the Form 10-Q filed for the quarter ended November 1, 2014.*
10.15		The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 17, 2015 is incorporated herein by reference to Exhibit 10.1 to the Form 10-Q filed for the quarter ended October 31, 2015. The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 17, 2015 is incorporated herein by reference to Exhibit 10.2 to the Form 10-Q filed for the quarter ended October 31, 2015.*
10.16		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.*
10.17		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.*
10.18		The Performance-Based Restricted Stock Award granted under the Stock Incentive Plan on January 29, 2016 to Carol Meyrowitz is filed herewith.*
10.19		The Restricted Stock Unit Award granted under the Stock Incentive Plan on January 29, 2016 to Ernie Herrman is filed herewith.*
10.20		The Form of Deferred Stock Award for Directors granted under the Stock Incentive Plan is incorporated herein by reference to Exhibit 10.20 to the Form 10-K filed for the fiscal year ended January 31, 2015.*
10.21		Description of Director Compensation Arrangements is filed herewith.*
10.22		The 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.*

10.23		The 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 for the fiscal year ended January 31, 2009.*
10.24		The Supplemental Executive Retirement Plan (2015 Restatement) is incorporated herein by reference to Exhibit 10.3 to the Form 10-Q filed for the quarter ended May 2, 2015.*
10.25		The Executive Savings Plan (As Amended and Restated, Effective January 1, 2015) (the ESP) is incorporated herein by reference to Exhibit 10.25 to the Form 10-K filed for the fiscal year ended January 31, 2015. The First Amendment to the ESP, dated December 30, 2015, is filed herewith.*
10.26		The 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 fiscal year ended February 2, 2013.*
10.27		The 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.*
10.28		The 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.*
10.29		The 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.*
10.30		The Trust Agreement for Executive Savings Plan dated as of October 23, 2015 between TJX and Vanguard Fiduciary Trust Company is incorporated herein by reference to Exhibit 10.5 to the Form 10-Q filed for the quarter ended October 31, 2015.*
21		Subsidiaries of TJX is filed herewith.
23		Consent of Independent Registered Public Accounting Firm is filed herewith.
24		Power of Attorney given by the Directors and certain Executive Officers of TJX is filed herewith.
31.1		Certification Statement of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 is filed herewith.
31.2		Certification Statement of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 is filed herewith.
32.1		Certification Statement of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith.
32.2		Certification Statement of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith.
101		The following materials from The TJX Companies, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 30, 2016, 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.
				By		/s/ SCOTT GOLDENBERG
Dated: March 29, 2016						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/ ERNIE HERRMAN Ernie Herrman, Chief Executive Officer, President and Director (Principal Executive Officer)		/s/ SCOTT GOLDENBERG Scott Goldenberg, Chief Financial Officer (Principal Financial and Accounting Officer)
ZEIN ABDALLA* Zein Abdalla, Director		AMY B. LANE* Amy B. Lane, Director
JOSE B. ALVAREZ* José B. Alvarez, Director		CAROL MEYROWITZ* Carol Meyrowitz, Executive Chairman of the Board of Directors
ALAN M. BENNETT* Alan M. Bennett, Director		JOHN F. O’BRIEN* John F. O’Brien, Director
DAVID T. CHING* David T. Ching, Director		WILLOW B. SHIRE* Willow B. Shire, Director
MICHAEL F. HINES* Michael F. Hines, Director		WILLIAM H. SWANSON* William H. Swanson, Director

		*BY		/s/ SCOTT GOLDENBERG
Dated: March 29, 2016				Scott Goldenberg, as attorney-in-fact

The TJX Companies, Inc.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

For Fiscal Years Ended January 30, 2016, January 31, 2015 and February 1, 2014.

Report of Independent Registered Public Accounting Firm			F-2
Consolidated Financial Statements:
Consolidated Statements of Income for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014			F-3
Consolidated Statements of Comprehensive Income for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014			F-4
Consolidated Balance Sheets as of January 30, 2016 and January 31, 2015			F-5
Consolidated Statements of Cash Flows for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014			F-6
Consolidated Statements of Shareholders’ Equity for the fiscal years ended January 30, 2016, January 31, 2015 and February 1, 2014			F-7
Notes to Consolidated Financial Statements			F-8
Financial Statement Schedules:
Schedule II – Valuation and Qualifying Accounts			41

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 January 30, 2016 and January 31, 2015, and the results of their operations and their cash flows for each of the three years in the period ended January 30, 2016, 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 January 30, 2016, based on criteria established in Internal Control—Integrated Framework 2013 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.

As discussed in Note K to the consolidated financial statements, the Company changed the manner in which it accounts for the classification of deferred taxes in the consolidated balance sheets due to the adoption of ASU 2015-17, Balance Sheet Classification of Deferred Taxes.

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

March 29, 2016

F-2

The TJX Companies, Inc.

CONSOLIDATED STATEMENTS OF INCOME

		Fiscal Year Ended
Amounts in thousands except per share amounts		January 30, 2016				January 31, 2015				February 1, 2014
Net sales		$	30,944,938			$	29,078,407			$	27,422,696
Cost of sales, including buying and occupancy costs			22,034,523				20,776,522				19,605,037
Selling, general and administrative expenses			5,205,715				4,695,384				4,467,089
Loss on early extinguishment of debt			—				16,830				—
Interest expense, net			46,400				39,787				31,081
Income before provision for income taxes			3,658,300				3,549,884				3,319,489
Provision for income taxes			1,380,642				1,334,756				1,182,093
Net income		$	2,277,658			$	2,215,128			$	2,137,396
Basic earnings per share:
Net income		$	3.38			$	3.20			$	3.00
Weighted average common shares – basic			673,484				692,691				713,470
Diluted earnings per share:
Net income		$	3.33			$	3.15			$	2.94
Weighted average common shares – diluted			683,251				703,545				726,376
Cash dividends declared per share		$	0.84			$	0.70			$	0.58

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 thousands		January 30, 2016				January 31, 2015				February 1, 2014
Net income		$	2,277,658			$	2,215,128			$	2,137,396
Additions to other comprehensive income:
Foreign currency translation adjustments, net of related tax benefits of $41,048, $56,567 and $41,713 in fiscal 2016, 2015 and 2014, respectively			(143,923	)			(218,700	)			(57,926	)
Loss on cash flow hedge, net of related tax benefit of $3,149 in fiscal 2015			—				(4,762	)			—
Recognition of net gains/losses on benefit obligations, net of related tax provision of $6,335, benefit of $91,941, and provision of $36,856 in fiscal 2016, 2015 and 2014, respectively			9,629				(139,366	)			55,285
Reclassifications from other comprehensive income to net income:
Amortization of loss on cash flow hedge, net of related tax provision of $450 and $300 in fiscal 2016 and 2015, respectively			684				452				—
Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $13,501, $4,591, and $11,001 in fiscal 2016, 2015 and 2014, respectively			20,523				7,523				16,501
Other comprehensive income (loss), net of tax			(113,087	)			(354,853	)			13,860
Total comprehensive income		$	2,164,571			$	1,860,275			$	2,151,256

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 amounts		January 30, 2016				January 31, 2015
ASSETS
Current assets:
Cash and cash equivalents		$	2,095,473			$	2,493,775
Short-term investments			352,313				282,623
Accounts receivable, net			238,072				213,824
Merchandise inventories			3,695,113				3,217,923
Prepaid expenses and other current assets			380,530				356,824
Federal, state, and foreign income taxes recoverable			11,059				12,475
Total current assets			6,772,560				6,577,444
Property at cost:
Land and buildings			1,013,247				888,580
Leasehold costs and improvements			2,943,191				2,780,932
Furniture, fixtures and equipment			5,112,229				4,671,029
Total property at cost			9,068,667				8,340,541
Less accumulated depreciation and amortization			4,931,092				4,472,176
Net property at cost			4,137,575				3,868,365
Non-current deferred income taxes, net			13,831				22,532
Other assets			231,720				210,539
Goodwill and tradenames, net of amortization			343,796				309,870
TOTAL ASSETS		$	11,499,482			$	10,988,750
LIABILITIES
Current liabilities:
Accounts payable		$	2,203,050			$	2,007,511
Accrued expenses and other current liabilities			2,069,659				1,796,122
Federal, state and foreign income taxes payable			129,521				126,001
Total current liabilities			4,402,230				3,929,634
Other long-term liabilities			881,021				888,137
Non-current deferred income taxes, net			285,102				282,885
Long-term debt			1,624,054				1,623,864
Commitments and contingencies (See Note L and Note N)
SHAREHOLDERS’ EQUITY
Preferred stock, authorized 5,000,000 shares, par value $1, no shares issued			—				—
Common stock, authorized 1,200,000,000 shares, par value $1, issued and outstanding 663,495,715 and 684,733,200, respectively			663,496				684,733
Additional paid-in capital			—				—
Accumulated other comprehensive income (loss)			(667,472	)			(554,385	)
Retained earnings			4,311,051				4,133,882
Total shareholders’ equity			4,307,075				4,264,230
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	11,499,482			$	10,988,750

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 thousands		January 30, 2016				January 31, 2015				February 1, 2014
Cash flows from operating activities:
Net income		$	2,277,658			$	2,215,128			$	2,137,396
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			616,696				588,975				548,823
Loss on property disposals and impairment charges			3,383				3,897				7,914
Deferred income tax provision			31,204				102,070				52,233
Share-based compensation			94,107				88,014				76,080
Early extinguishment of debt			—				16,830				—
Excess tax benefits from share-based compensation			(64,680	)			(95,063	)			(82,546	)
Changes in assets and liabilities:
(Increase) decrease in accounts receivable			(27,357	)			(9,052	)			11,979
(Increase) decrease in merchandise inventories			(506,633	)			(332,271	)			35,233
Decrease (increase) in taxes recoverable			1,416				(12,475	)			—
(Increase) decrease in prepaid expenses and other current assets			(41,519	)			3,719				(3,354	)
Increase (decrease) in accounts payable			216,265				285,223				(152,271	)
Increase (decrease) in accrued expenses and other liabilities			284,929				20,800				(29,590	)
Increase in income taxes payable			68,014				144,977				10,994
Other			(16,140	)			(12,403	)			(12,425	)
Net cash provided by operating activities			2,937,343				3,008,369				2,600,466
Cash flows from investing activities:
Property additions			(889,380	)			(911,522	)			(946,678	)
Purchases of investments			(798,008	)			(431,152	)			(496,657	)
Sales and maturities of investments			681,377				388,037				394,914
Cash paid for acquisition of Trade Secret, net of cash received			(57,104	)			—				—
Cash received at completion of acquisition of Sierra Trading Post			—				—				2,653
Net cash (used in) investing activities			(1,063,115	)			(954,637	)			(1,045,768	)
Cash flows from financing activities:
Proceeds from issuance of long-term debt			—				749,475				499,555
Cash payments for extinguishment of debt			—				(416,357	)			—
Cash payments for debt issuance expenses			—				(6,185	)			(4,297	)
Cash payments for rate lock agreement			—				(7,937	)			(3,251	)
Cash payments for repurchase of common stock			(1,828,297	)			(1,650,704	)			(1,471,096	)
Proceeds from issuance of common stock			132,033				143,005				146,495
Excess tax benefits from share-based compensation			64,680				95,063				82,546
Cash dividends paid			(544,271	)			(465,902	)			(393,755	)
Net cash (used in) financing activities			(2,175,855	)			(1,559,542	)			(1,143,803	)
Effect of exchange rate changes on cash			(96,675	)			(150,161	)			(73,106	)
Net (decrease) increase in cash and cash equivalents			(398,302	)			344,029				337,789
Cash and cash equivalents at beginning of year			2,493,775				2,149,746				1,811,957
Cash and cash equivalents at end of year		$	2,095,473			$	2,493,775			$	2,149,746

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

F-6

The TJX Companies, Inc.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

		Common Stock								Additional Paid-In Capital				Accumulated Other Comprehensive Income (Loss)				Retained Earnings				Total
Amounts in thousands		Shares				Par Value $1
Balance, February 2, 2013			723,902			$	723,902			$	—			$	(213,392	)		$	3,155,427			$	3,665,937
Net income			—				—				—				—				2,137,396				2,137,396
Other comprehensive income (loss), net of tax			—				—				—				13,860				—				13,860
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 effect			8,462				8,462				212,388				—				—				220,850
Common stock repurchased			(27,347	)			(27,347	)			(288,468	)			—				(1,155,281	)			(1,471,096	)
Balance, February 1, 2014			705,017				705,017				—				(199,532	)			3,724,408				4,229,893
Net income			—				—				—				—				2,215,128				2,215,128
Other comprehensive income (loss), net of tax			—				—				—				(354,853	)			—				(354,853	)
Cash dividends declared on common stock			—				—				—				—				(483,280	)			(483,280	)
Recognition of share-based compensation			—				—				88,014				—				—				88,014
Issuance of common stock under stock incentive plan and related tax effect			7,318				7,318				212,714				—				—				220,032
Common stock repurchased			(27,602	)			(27,602	)			(300,728	)			—				(1,322,374	)			(1,650,704	)
Balance, January 31, 2015			684,733				684,733				—				(554,385	)			4,133,882				4,264,230
Net income			—				—				—				—				2,277,658				2,277,658
Other comprehensive income (loss), net of tax			—				—				—				(113,087	)			—				(113,087	)
Cash dividends declared on common stock			—				—				—				—				(564,586	)			(564,586	)
Recognition of share-based compensation			—				—				94,107				—				—				94,107
Issuance of common stock under stock incentive plan and related tax effect			5,317				5,317				171,733				—				—				177,050
Common stock repurchased			(26,554	)			(26,554	)			(265,840	)			—				(1,535,903	)			(1,828,297	)
Balance, January 30, 2016			663,496			$	663,496			$	—			$	(667,472	)		$	4,311,051			$	4,307,075

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,” “we” or “the Company”) 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 January 30, 2016 (fiscal 2016), January 31, 2015 (fiscal 2015) and February 1, 2014 (fiscal 2014) each included 52 weeks.

Earnings Per Share: All earnings per share amounts refer to diluted earnings per share, unless otherwise indicated.

Use of Estimates: Preparation of the TJX Companies, Inc. 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 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 (referred to as breakage) and, to the extent allowed by local law, these amounts are amortized into income over the redemption period. Revenue recognized from breakage was $13.8 million in fiscal 2016, $17.8 million in fiscal 2015 and $17.5 million in fiscal 2014. 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 including foreign currency gains and losses on merchandise purchases denominated in other currencies; 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.

As of January 30, 2016, TJX’s cash and cash equivalents held outside the U.S. were $1.2 billion, of which $355.4 million was held in countries where TJX has the intention to reinvest any undistributed earnings indefinitely.

F-8

Merchandise Inventories****: Inventories are stated at the lower of cost or market. TJX uses the retail method for valuing inventories at all of its businesses, except Sierra Trading Post (STP), and Trade Secret. The businesses that utilize the retail method have some inventory that is initially valued at cost before the retail method is applied as it has not been fully processed for sale (e.g. inventory in transit and unprocessed inventory in our distribution centers). Under the retail method, 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 title transfers, which is typically at the time when inventory is shipped. As a result, merchandise inventories on TJX’s balance sheet include an accrual for in-transit inventory of $690.3 million at January 30, 2016 and $495.2 million at January 31, 2015. Comparable amounts were reflected in accounts payable at those dates.

Common Stock and Equity: 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 the market price on the grant date for performance-based restricted stock awards. See Note H for a detailed discussion of share-based compensation.

Interest****: TJX’s interest expense is presented net of capitalized interest and interest income. The following is a summary of net interest expense:

		Fiscal Year Ended
Dollars in thousands		January 30, 2016				January 31, 2015				February 1, 2014
Interest expense		$	68,253			$	64,783			$	57,084
Capitalized interest			(7,984	)			(9,403	)			(10,993)
Interest (income)			(13,869	)			(15,593	)			(15,010)
Interest expense, net		$	46,400			$	39,787			$	31,081

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 2016, 2015 and 2014 relates to costs on active owned real estate projects and development costs on a merchandising system.

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 $622.0 million in fiscal 2016, $595.6 million in fiscal 2015 and $555.8 million in fiscal 2014. TJX had no property held under capital lease during fiscal 2016, 2015, or

F-9

2014. Maintenance and repairs are charged to expense as incurred. Significant costs incurred for internally developed software are capitalized and amortized over 3 to 15 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. Lease agreements involving property built to our specifications are reviewed to determine if our involvement in the construction project requires that we account for the project costs as if we were the owner for accounting purposes. We have entered into several lease agreements where we are deemed the owner of a construction project for accounting purposes. Thus, during construction of the facility the construction costs incurred by the lessor are included as a construction in progress asset along with a related liability of the same amount on our balance sheet. Upon completion of the project, a sale-leaseback analysis is performed to determine if the Company should record a sale to remove the related asset and related obligation and record the lease as either an operating or capital lease obligation. If the Company is precluded from derecognizing the asset when construction is complete, due to continuing involvement beyond a normal leaseback, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remain on the Consolidated Balance Sheets. Accordingly, the asset is depreciated over its estimated useful life in accordance with the Company’s policy and a portion of the lease payments is allocated to ground rent and treated as an operating lease. The portion of the lease payment allocated to ground rental expense is based on the fair value of the land at the commencement of construction. Lease payments allocated to the non-land asset are recognized as reductions to the financing obligation and interest expense.

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 thousands		January 30, 2016				January 31, 2015				February 1, 2014
United States		$	3,101,846			$	2,927,297			$	2,693,670
Canada			242,705				266,332				214,459
Europe			782,970				674,736				686,372
Australia			10,054				—				—
Total long-lived assets		$	4,137,575			$	3,868,365			$	3,594,501

Goodwill and Tradenames: 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, the purchase of Sierra Trading Post in fiscal 2013, and the purchase of Trade Secret in fiscal 2016 (See Note B). The following is a rollforward of goodwill by component:

Amounts in thousands		Marmaxx				Winners				Sierra Trading Post				Trade Secret				Total
Balance, February 2, 2013		$	70,027			$	2,226			$	98,035			$	—			$	170,288
Adjustment to purchase price			—				—				(781	)			—				(781	)
Effect of exchange rate changes on goodwill			—				(234	)			—				—				(234	)
Balance, February 1, 2014			70,027				1,992				97,254				—				169,273
Effect of exchange rate changes on goodwill			—				(251	)			—				—				(251	)
Balance, January 31, 2015			70,027				1,741				97,254				—				169,022
Additions			—				—				—				25,233				25,233
Effect of exchange rate changes on goodwill			—				(154	)			—				(190	)			(344	)
Balance, January 30, 2016		$	70,027			$	1,587			$	97,254			$	25,043			$	193,911

Goodwill is considered to have an indefinite life and accordingly is not amortized.

F-10

Tradenames are the value assigned to the name “Marshalls,” acquired by TJX in fiscal 1996 as part of the acquisition of the Marshalls chain, the value assigned to the name “Sierra Trading Post,” acquired by TJX in fiscal 2013 and the value assigned to the name “Trade Secret,” acquired by TJX in fiscal 2016. The tradenames were valued by calculating the discounted present value of assumed after-tax royalty payments. 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 was carried at a value of $30.6 million in fiscal 2016, $33.2 million in fiscal 2015 and $35.7 million in fiscal 2014 net of amortization of $7.9 million, $5.3 million and $2.8 million in fiscal 2016, fiscal 2015 and fiscal 2014, respectively. The Trade Secret tradename is being amortized over 10 years and was carried at a value of $11.6 million in fiscal 2016 net of amortization of $300,000.

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, tradenames 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 Tradenames: TJX evaluates its long-lived assets, goodwill and tradenames 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 cash flows which are largely independent of other groups of assets, 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 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. In fiscal 2016 and fiscal 2015, we bypassed the qualitative assessment and performed the first step of the quantitative goodwill impairment test.

Tradenames are 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 tradenames in fiscal 2016, 2015 or 2014.

Advertising Costs: TJX expenses advertising costs as incurred. Advertising expense was $382.9 million for fiscal 2016, $371.3 million for fiscal 2015 and $333.5 million for fiscal 2014.

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.

F-11

New Accounting Standards: In May 2014, a pronouncement was issued that creates common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards. The new guidance supersedes most preexisting revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard was originally scheduled to be effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. In April 2015, the Financial Accounting Standards Board proposed an update to this rule which would defer its effective date for one year. The proposed update stipulates the new standard would be effective for annual reporting periods beginning after December 15, 2017, and interim periods therein, with an option to adopt the standard on the originally scheduled effective date. The standard shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. For TJX, the standard will be effective in the first quarter of the fiscal year ending February 2, 2019. TJX is in the process of evaluating this guidance to determine the impact it will have on our consolidated financial statements.

In April 2015, a pronouncement was issued that allows employers with fiscal year ends that do not coincide with a calendar month end to make an accounting policy election to measure defined benefit plan assets and obligations as of the end of the month closest to their fiscal year end. This update is effective for interim and annual reporting periods beginning after December 15, 2015. TJX is in the process of evaluating this guidance to determine the impact it will have on our consolidated financial statements.

In April 2015, a pronouncement was issued that requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. For TJX, the standard will be effective in the first quarter of fiscal 2017. TJX expects to change the presentation of our debt issuance costs as prescribed by the new guidance.

In May 2015, a pronouncement was issued that removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The pronouncement also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments for which the entity has elected to measure the fair value using that practical expedient. The guidance is effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. Earlier application is permitted and TJX has adopted these provisions, including the retrospective application, to all periods presented in the consolidated financial statements.

In September 2015, a pronouncement was issued that eliminates the requirement to restate prior period financial statements for measurement period adjustments following a business combination. The guidance requires that the cumulative impact of a measurement period adjustment be recognized in the reporting period in which the adjustment is identified. The portion of the adjustment which relates to a prior period should either be presented separately on the face of the income statement or disclosed in the notes. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015, with early adoption permitted. The guidance is to be applied prospectively to adjustments to provisional amounts that occur after the effective date. TJX does not expect this new guidance to have a material impact on our consolidated financial statements.

In November 2015, a pronouncement was issued that requires entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as noncurrent in a classified balance sheet. It simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current or noncurrent in a classified balance sheet. Netting of DTAs and DTLs by tax jurisdiction is still required under the new guidance. This pronouncement is effective for annual periods beginning after December 15, 2016, and interim periods within those fiscal years; early adoption is permitted. TJX has adopted this guidance as of January 30, 2016, and has applied it retrospectively. As a result, we have recast the January 31, 2015 consolidated balance sheet to conform to the current period presentation. The adoption of this standard reduced previously-presented current DTAs by $137.6 million, decreased long-term DTAs by $2.0 million and reduced long-term DTLs by $139.6 million as of January 31, 2015.

In February 2016, the Financial Accounting Standards Board issued ASU 2016-02, “Leases (Topic 842),” which will replace the existing guidance in ASC 840, “Leases.” The updated standard aims to increase transparency and

F-12

comparability among organizations by requiring lessees to recognize lease assets and lease liabilities on the balance sheet and requiring disclosure of key information about leasing arrangements. ASU 2016-02 is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods; early adoption is permitted and modified retrospective application is required. TJX is in the process of evaluating this guidance to determine the impact it will have on our financial statements.

In March 2016, the Financial Accounting Standards Board issued ASU 2016-04 “Liabilities-Extinguishments of Liabilities.” The updated standard aims to address the diversity in practice related to the derecognition of prepaid store-value product liabilities. ASU 2016-04 is effective for annual periods beginning after December 15, 2017 and interim periods within those annual periods; early adoption is permitted and modified retrospective application is required. TJX is in the process of evaluating this guidance to determine the impact it will have on our financial statements.

Note B. Acquisition of Trade Secret

On October 24, 2015, TJX purchased Trade Secret, an off-price retailer that operates 35 stores in Australia, for approximately AUD$83 million (U.S. $59 million), which is subject to customary post-closing adjustments.

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.

The following table presents the allocation of the purchase price (after preliminary adjustment for customary post-closing adjustments) to the assets and liabilities acquired based on their estimated fair values as of October 24, 2015:

In thousands		Allocation of purchase price
Current assets		$	25,962
Property and equipment			10,184
Goodwill and intangible assets			37,225
Total assets acquired			73,371
Total liabilities assumed			(14,071	)
Net assets acquired		$	59,300

As is customary, the amounts above may be further adjusted up to one year after date of acquisition.

Goodwill and intangible assets include identified intangible assets of $12 million for the value of the tradename “Trade Secret” which is being amortized over 10 years, and $25 million representing goodwill (See Note A).

The operating results of Trade Secret have been included in TJX’s consolidated financial statements from the date of acquisition and Trade Secret is now part of the TJX International segment along with our European operations. Pro forma results of operations assuming the acquisition of Trade Secret occurred as of the beginning of fiscal 2015 have not been presented as the inclusion of the results of operations for the acquired business would not have produced a material impact on TJX’s sales, net income or earnings per share as reported.

F-13

Note C. Accumulated Other Comprehensive Income (Loss)

Amounts included in accumulated other comprehensive income (loss) relate to the Company’s foreign currency translation adjustments, minimum pension and other post-retirement liabilities and cash flow hedge on issued debt, all of which are recorded net of the related income tax effects. The following table details the changes in accumulated other comprehensive income (loss) for fiscal 2016, fiscal 2015 and fiscal 2014:

Amounts in thousands		Foreign Currency Translation				Deferred Benefit Costs				Cash Flow Hedge on Debt				Accumulated Other Comprehensive Income (Loss)
Balance, February 2, 2013		$	(18,643	)		$	(194,749	)		$	—			$	(213,392	)
Foreign currency translation adjustments (net of taxes of $41,713)			(57,926	)			—				—				(57,926	)
Recognition of net gains/losses on benefit obligations (net of taxes of $36,856)			—				55,285				—				55,285
Amortization of deferred benefit costs (net of taxes of $11,001)			—				16,501				—				16,501
Balance, February 1, 2014			(76,569	)			(122,963	)			—				(199,532	)
Foreign currency translation adjustments (net of taxes of $56,567)			(218,700	)			—				—				(218,700	)
Recognition of net gains/losses on benefit obligations (net of taxes of $91,941)			—				(139,366	)			—				(139,366	)
Loss on cash flow hedge (net of taxes of $3,149)			—				—				(4,762	)			(4,762	)
Amortization of loss on cash flow hedge (net of taxes of $300)			—				—				452				452
Amortization of prior service cost and deferred gains/losses (net of taxes of $4,591)			—				7,523				—				7,523
Balance, January 31, 2015			(295,269	)			(254,806	)			(4,310	)			(554,385	)
Foreign currency translation adjustments (net of taxes of $41,048)			(143,923	)			—				—				(143,923	)
Recognition of net gains/losses on benefit obligations (net of taxes of $6,335)			—				9,629				—				9,629
Amortization of loss on cash flow hedge (net of taxes of $450)			—				—				684				684
Amortization of prior service cost and deferred gains/losses (net of taxes of $13,501)			—				20,523				—				20,523
Balance, January 30, 2016		$	(439,192	)		$	(224,654	)		$	(3,626	)		$	(667,472	)

Note D. Capital Stock and Earnings Per Share

Capital Stock: TJX repurchased and retired 26.5 million shares of its common stock at a cost of $1.8 billion during fiscal 2016, 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 $1.8 billion in fiscal 2016, $1.7 billion in fiscal 2015 and $1.5 billion in fiscal 2014, and repurchased 26.6 million shares in fiscal 2016, 27.6 million shares in fiscal 2015 and 27.3 million shares in fiscal 2014. These expenditures were funded primarily by cash generated from operations. As of January 30, 2016 TJX had $1.5 billion available under the existing $2.0 billion stock repurchase program announced by TJX in February 2015. In addition, in February 2016, TJX announced the Board of Directors had approved the repurchase of an additional $2.0 billion of TJX common stock from time to time.

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

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

F-14

Earnings Per Share: The following table presents the calculation of basic and diluted earnings per share for net income:

		Fiscal Year Ended
Amounts in thousands except per share amounts		January 30, 2016				January 31, 2015				February 1, 2014
Basic earnings per share:
Net income		$	2,277,658			$	2,215,128			$	2,137,396
Weighted average common stock outstanding for basic earnings per share calculation			673,484				692,691				713,470
Basic earnings per share		$	3.38			$	3.20			$	3.00
Diluted earnings per share:
Net income		$	2,277,658			$	2,215,128			$	2,137,396
Weighted average common stock outstanding for basic earnings per share calculation			673,484				692,691				713,470
Assumed exercise / vesting of:
Stock options and awards			9,767				10,854				12,906
Weighted average common stock outstanding for diluted earnings per share calculation			683,251				703,545				726,376
Diluted earnings per share		$	3.33			$	3.15			$	2.94

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 average price of TJX’s common stock for the related fiscal periods. Such options are excluded because they would have an antidilutive effect. There were 4.1 million, 8.8 million and 4.7 million such options excluded at the end of fiscal 2016, fiscal 2015 and fiscal 2014, respectively.

Note E. 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 as well as fuel costs. These market risks may adversely affect TJX’s operating results and financial position. TJX seeks to minimize risk from changes in interest rates and foreign currency exchange rates and fuel costs, to the extent we deem appropriate, 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. During fiscal 2015 and fiscal 2016, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2016. Similarly, during fiscal 2016, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for the fiscal year ending January 28, 2017 (fiscal 2017). The hedge agreements outstanding at January 30, 2016 relate to approximately 40% of TJX’s estimated notional diesel requirements for fiscal 2017. These diesel fuel hedge agreements will settle throughout fiscal 2017. TJX elected not to apply hedge accounting rules to these contracts.

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 the Company’s operations in Europe (United Kingdom, Ireland, Germany, Poland, Austria, and the Netherlands), 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 January 30, 2016 cover a portion of such actual and anticipated merchandise purchases throughout fiscal 2017. Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the United Kingdom. All merchandise is purchased centrally in the U.K. and then shipped and billed to the retail entities in other countries. This intercompany billing to TJX’s European businesses’ Euro denominated operations creates exposure to the buying entity for changes in the exchange rate between the Euro and British Pound. The inflow of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros. However, with the growth of TJX’s Euro denominated retail operations, the intercompany billings committed to the Euro denominated operations is generating Euros in excess of those needed to meet merchandise commitments to outside vendors. TJX calculates this excess Euro exposure each month and enters a 30 day hedge to mitigate the exposure. 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 January 30, 2016:

In thousands		Pay				Receive				Blended Contract Rate				Balance Sheet Location				Current Asset U.S.$				Current (Liability) U.S.$				Net Fair Value in U.S.$ at January 30, 2016
Fair value hedges:
Intercompany balances, primarily debt and related interest
			zł 87,073				C$ 29,950				0.3440				Prepaid Exp			$	144			$	—			$	144
			zł 45,000				£ 7,403				0.1645				(Accrued Exp)				—				(448	)			(448	)
			€ 45,000				£ 34,496				0.7666				(Accrued Exp)				—				(200	)			(200	)
			U.S.$ 77,957				£ 55,000				0.7055				Prepaid Exp				535				—				535
Economic hedges for which hedge accounting was not elected:
Diesel contracts			Fixed on 900K —3.0M gal per month				Float on 900K —3.0M gal per month				N/A				(Accrued Exp	)			—				(13,952	)			(13,952	)
Intercompany billings in Europe, primarily merchandise related			€ 60,000				£ 46,113				0.7686				Prepaid Exp				566				—				566
Merchandise purchase commitments
			C$ 434,271				U.S.$ 322,050				0.7416				Prepaid Exp / (Accrued Exp)				12,891				(1,601	)			11,290
			C$ 16,719				€ 11,250				0.6729				Prepaid Exp / (Accrued Exp)				316				(90	)			226
			£ 174,235				U.S.$ 262,250				1.5052				Prepaid Exp				13,996				—				13,996
			zł 195,892				£ 33,088				0.1689				Prepaid Exp / (Accrued Exp)				123				(926	)			(803	)
			U.S.$ 18,243				€ 16,724				0.9167				Prepaid Exp / (Accrued Exp)				72				(190	)			(118	)
Total fair value of financial instruments																		$	28,643			$	(17,407	)		$	11,236

F-16

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at January 31, 2015:

In thousands		Pay				Receive				Blended Contract Rate				Balance Sheet Location				Current Asset U.S.$				Current (Liability) U.S.$				Net Fair Value in U.S.$ at January 31, 2015
Fair value hedges:
Intercompany balances, primarily debt and related interest
			zł 94,073				C$ 32,318				0.3435				Prepaid Exp / (Accrued Exp)			$	153			$	(81	)		$	72
			€ 39,000				£ 30,988				0.7946				Prepaid Exp / (Accrued Exp)				2,536				(72	)			2,464
			€ 19,850				U.S.$ 22,647				1.1409				Prepaid Exp				108				—				108
			U.S.$ 83,401				£ 55,000				0.6595				(Accrued Exp)				—				(725	)			(725	)
Economic hedges for which hedge accounting was not elected:
Diesel contracts			Fixed on 1.2M —1.9M gal per month				Float on 1.2M —1.9M gal per month				N/A				(Accrued Exp)				—				(15,324	)			(15,324	)
Merchandise purchase commitments
			C$ 322,492				U.S.$ 281,890				0.8741				Prepaid Exp				28,789				—				28,789
			C$ 13,426				€ 9,500				0.7076				Prepaid Exp				183				—				183
			£ 77,722				U.S.$ 123,500				1.5890				Prepaid Exp				6,477				—				6,477
			zł 139,215				£ 25,547				0.1835				Prepaid Exp / (Accrued Exp)				1,172				(166	)			1,006
			U.S.$ 12,590				€ 10,353				0.8223				Prepaid Exp / (Accrued Exp)				1				(898	)			(897	)
Total fair value of financial instruments																		$	39,419			$	(17,266	)		$	22,153

The impact of derivative financial instruments on the statements of income during fiscal 2016, fiscal 2015 and fiscal 2014 are as follows:

				Amount of Gain (Loss) Recognized in Income by Derivative
In thousands		Location of Gain (Loss) Recognized in Income by Derivative		January 30, 2016				January 31, 2015				February 1, 2014
Fair value hedges:
Intercompany balances, primarily debt and related interest		Selling, general and administrative expenses		$	(3,927	)		$	7,413			$	6,099
Economic hedges for which hedge accounting was not elected:
Diesel contracts		Cost of sales, including buying and occupancy costs			(21,797	)			(16,050	)			(1,831	)
Intercompany billings in Europe, primarily merchandise related		Cost of sales, including buying and occupancy costs			(5,768	)			—				—
Merchandise purchase commitments		Cost of sales, including buying and occupancy costs			49,107				41,554				22,338
Gain recognized in income				$	17,615			$	32,917			$	26,606

Included in the table above are realized gains of $28.5 million in fiscal 2016, $24.3 million in fiscal 2015 and $10.7 million in fiscal 2014, all of which were largely offset by gains and losses on the underlying hedged item.

F-17

Note F. 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 thousands		January 30, 2016				January 31, 2015				February 1, 2014
Level 1
Assets:
Executive Savings Plan investments		$	155,847			$	151,936			$	131,049
Level 2
Assets:
Short-term investments		$	352,313			$	282,623			$	294,702
Foreign currency exchange contracts			28,643				39,419				19,482
Diesel fuel contracts			—				—				137
Liabilities:
Foreign currency exchange contracts		$	3,455			$	1,942			$	6,107
Diesel fuel contracts			13,952				15,324				—

Investments designed to meet obligations under the Executive Savings Plan are invested in registered investment companies 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’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks. 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.

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 January 30, 2016 was $1.70 billion compared to a carrying value of $1.62 billion. The fair value of long-term debt at January 31, 2015 was $1.73 billion compared to a carrying value of $1.62 billion. The fair value of long-term debt at February 1, 2014 was $1.34 billion compared to a carrying value of $1.27 billion. 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.

Note G. 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 International segment operates T.K. Maxx, HomeSense and tkmaxx.com in Europe and Trade Secret in Australia. TJX also operates Sierra Trading Post, an off-price Internet retailer that operates a small number of stores in the U.S. The results of STP are included in the Marmaxx segment.

F-18

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

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

		Fiscal 2016				Fiscal 2015				Fiscal 2014
Apparel
Clothing including footwear			55	%			57	%			58	%
Jewelry and accessories			15				14				14
Home fashions			30				29				28
Total			100	%			100	%			100	%

For fiscal 2016, TJX Canada and TJX International accounted for 23% of TJX’s net sales, 17% of segment profit and 23% 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, loss on early extinguishment of debt and interest expense, net. “Segment profit or loss,” as defined by TJX, may not be comparable to similarly titled measures used by other entities. 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 thousands		January 30, 2016				January 31, 2015				February 1, 2014
Net sales:
In the United States
Marmaxx		$	19,948,227			$	18,687,880			$	17,929,576
HomeGoods			3,915,221				3,414,351				2,993,718
TJX Canada			2,854,617				2,883,863				2,877,834
TJX International			4,226,873				4,092,313				3,621,568
		$	30,944,938			$	29,078,407			$	27,422,696
Segment profit:
In the United States
Marmaxx		$	2,858,780			$	2,736,694			$	2,612,693
HomeGoods			549,318				463,193				386,541
TJX Canada			375,306				393,622				405,363
TJX International			316,939				337,406				275,453
			4,100,343				3,930,915				3,680,050
General corporate expense			395,643				324,414				329,480
Loss on early extinguishment of debt			—				16,830				—
Interest expense, net			46,400				39,787				31,081
Income before provision for income taxes		$	3,658,300			$	3,549,884			$	3,319,489

F-19

Business segment information (continued):

		Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				February 1, 2014
Identifiable assets:
In the United States
Marmaxx		$	5,526,570			$	5,014,573			$	4,700,347
HomeGoods			915,549				777,214				638,742
TJX Canada			1,021,584				1,020,955				962,101
TJX International			1,645,296				1,531,661				1,510,132
Corporate(1)			2,390,483				2,644,347				2,286,345
		$	11,499,482			$	10,988,750			$	10,097,667
Capital expenditures:
In the United States
Marmaxx		$	442,910			$	445,041			$	551,839
HomeGoods			130,593				148,354				99,828
TJX Canada			71,071				100,779				104,888
TJX International			244,806				217,348				190,123
		$	889,380			$	911,522			$	946,678
Depreciation and amortization:
In the United States
Marmaxx		$	364,892			$	340,830			$	318,414
HomeGoods			67,204				54,867				47,176
TJX Canada			54,573				66,141				66,295
TJX International			126,020				123,547				114,651
Corporate(2)			4,007				3,590				2,287
		$	616,696			$	588,975			$	548,823

(1)	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.

(2)	Includes debt discount accretion and debt expense amortization.

Note H. 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 36.0 million shares available for future grants as of January 30, 2016. TJX issues shares under the plan from authorized but unissued common stock.

Total compensation cost related to share-based compensation was $94.1 million, $88.0 million and $76.1 million in fiscal 2016, 2015 and 2014, respectively. As of January 30, 2016, there was $132.4 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 with an exercise price that is 100% of market price on the grant date, 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, 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
		January 30, 2016				January 31, 2015				February 1, 2014
Risk-free interest rate			1.50	%			1.79	%			1.42	%
Dividend yield			1.2	%			1.2	%			1.0	%
Expected volatility factor			24.4	%			24.2	%			25.9	%
Expected option life in years			4.5				4.5				4.4
Weighted average fair value of options issued		$	14.48			$	12.00			$	11.92

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
		January 30, 2016								January 31, 2015								February 1, 2014
		Options				WAEP				Options				WAEP				Options				WAEP
Outstanding at beginning of year			30,078			$	34.91				32,628			$	28.30				36,620			$	22.31
Granted			4,169				72.54				4,849				59.70				4,742				56.71
Exercised			(5,124	)			25.87				(6,981	)			20.39				(8,258	)			17.71
Forfeitures			(437	)			55.06				(418	)			48.76				(476	)			34.74
Outstanding at end of year			28,686			$	41.68				30,078			$	34.91				32,628			$	28.30
Options exercisable at end of year			20,175			$	31.75				21,001			$	25.75				22,473			$	20.19

The total intrinsic value of options exercised was $227.4 million in fiscal 2016, $286.3 million in fiscal 2015 and $289.8 million in fiscal 2014.

The following table summarizes information about stock options outstanding that were expected to vest and stock options outstanding that were exercisable as of January 30, 2016:

Shares in thousands		Shares				Aggregate Intrinsic Value				Weighted Average Remaining Contract Life				WAEP
Options outstanding expected to vest			7,862			$	51,648				8.9 years			$	65.29
Options exercisable			20,175			$	796,741				5.1 years			$	31.75
Total outstanding options vested and expected to vest			28,037			$	848,389				6.2 years			$	41.15

Options outstanding expected to vest represents total unvested options of 8.5 million adjusted for anticipated forfeitures.

Performance-Based Stock Awards: TJX grants performance-based restricted stock, performance-based restricted stock units and performance-based deferred stock awards (collectively referred to as performance-based stock awards) under the Stock Incentive Plan. These awards are granted without a purchase price to the recipient and are subject to vesting conditions, including specified performance criteria aligned with management incentive plans for a period of generally one to three years. The grant date fair value of the awards 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.

F-21

A summary of the status of our nonvested performance-based stock awards and changes during fiscal 2016 is presented below:

Shares in thousands		Performance- based stock awards				Weighted Average Grant Date Fair Value
Nonvested at beginning of year			1,810			$	53.16
Granted			696				70.41
Vested			(646	)			41.97
Forfeited			(84	)			61.89
Nonvested at end of year			1,776			$	63.57

There were 696,057 shares of performance-based stock awards, with a weighted average grant date fair value of $70.41, granted in fiscal 2016, 717,500 shares of performance-based stock awards, with a weighted average grant date fair value of $62.85, granted in fiscal 2015, and 743,576 shares of performance-based stock awards, with a weighted average grant date fair value of $51.02, granted in fiscal 2014. The fair value of performance-based stock awards that vested was $27.1 million in fiscal 2016, $21.4 million in fiscal 2015, and $14.2 million 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 which were valued at $75,000 for fiscal 2016. 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 2016, a total of 301,654 of these deferred shares were outstanding under the plan.

Note I. Pension Plans and Other Retirement Benefits

Pension****: TJX has a funded defined benefit retirement plan that covers eligible 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).

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 Ended								Unfunded Plan Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				January 30, 2016				January 31, 2015
Change in projected benefit obligation:
Projected benefit obligation at beginning of year		$	1,309,889			$	996,968			$	82,238			$	59,566
Service cost			50,080				40,481				1,562				1,398
Interest cost			51,710				49,522				3,033				3,001
Actuarial (gains) losses			(170,674	)			251,144				3,806				19,552
Benefits paid			(24,956	)			(28,348	)			(5,672	)			(1,279	)
Expenses paid			(3,049	)			(2,945	)			—				—
Plan amendment			—				3,067				—				—
Projected benefit obligation at end of year		$	1,213,000			$	1,309,889			$	84,967			$	82,238
Accumulated benefit obligation at end of year		$	1,120,602			$	1,203,464			$	70,750			$	68,591

F-22

		Funded Plan Fiscal Year Ended								Unfunded Plan Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				January 30, 2016				January 31, 2015
Change in plan assets:
Fair value of plan assets at beginning of year		$	1,170,748			$	944,801			$	—			$	—
Actual return on plan assets			(72,901	)			107,240				—				—
Employer contribution			50,000				150,000				5,672				1,279
Benefits paid			(24,956	)			(28,348	)			(5,672	)			(1,279	)
Expenses paid			(3,049	)			(2,945	)			—				—
Fair value of plan assets at end of year		$	1,119,842			$	1,170,748			$	—			$	—
Reconciliation of funded status:
Projected benefit obligation at end of year		$	1,213,000			$	1,309,889			$	84,967			$	82,238
Fair value of plan assets at end of year			1,119,842				1,170,748				—				—
Funded status – excess obligation		$	93,158			$	139,141			$	84,967			$	82,238
Net liability recognized on consolidated balance sheets		$	93,158			$	139,141			$	84,967			$	82,238
Amounts not yet reflected in net periodic benefit cost and included in accumulated other comprehensive income (loss):
Prior service cost		$	2,690			$	3,067			$	—			$	—
Accumulated actuarial losses			348,289				401,165				29,046				29,198
Amounts included in accumulated other comprehensive income (loss)		$	350,979			$	404,232			$	29,046			$	29,198

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 $178.1 million at January 30, 2016 is reflected on the balance sheet as of that date as a current liability of $3.2 million and a long-term liability of $174.9 million.

The combined net accrued liability of $221.4 million at January 31, 2015 is reflected on the balance sheet as of that date as a current liability of $3.5 million and a long-term liability of $217.9 million.

The estimated prior service cost that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in fiscal 2017 for the funded plan is $377,000. The estimated net actuarial loss that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost in fiscal 2017 is $28.5 million for the funded plan and $3.5 million for the unfunded plan.

In fiscal 2015, the Society of Actuaries issued new mortality tables projecting longer life expectancies that will result in higher postretirement benefit obligations for U.S. companies. Accordingly, we updated our mortality assumptions at January 31, 2015. The new mortality assumptions increased our funded plan’s benefit obligation by $59 million and the unfunded plan’s benefit obligation by $4 million at January 31, 2015. Both of these amounts are included in actuarial gains/losses presented in the change in the projected benefit obligation.

TJX determined the assumed discount rate using the BOND: Link model in fiscal 2016 and fiscal 2015. TJX uses 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 Ended								Unfunded Plan Fiscal Year Ended
		January 30, 2016				January 31, 2015				January 30, 2016				January 31, 2015
Discount rate			4.80	%			4.00	%			4.20	%			3.70	%
Rate of compensation increase			4.00	%			4.00	%			6.00	%			6.00	%

F-23

TJX made aggregate cash contributions of $55.7 million in fiscal 2016, $151.3 million in fiscal 2015 and $32.7 million in fiscal 2014 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 2017 for the funded plan. We anticipate making contributions of $3.3 million to provide current benefits coming due under the unfunded plan in fiscal 2017.

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

		Funded Plan Fiscal Year Ended												Unfunded Plan Fiscal Year Ended
Dollars in thousands		January 30, 2016				January 31, 2015				February 1, 2014				January 30, 2016				January 31, 2015				February 1, 2014
Net periodic pension cost:
Service cost		$	50,080			$	40,481			$	44,623			$	1,562			$	1,398			$	1,716
Interest cost			51,710				49,522				44,654				3,033				3,001				2,447
Expected return on plan assets			(78,042	)			(65,187	)			(60,474	)			—				—				—
Amortization of prior service cost			377				—				—				—				2				3
Amortization of net actuarial loss			33,146				13,848				28,070				3,958				2,146				2,884
Total expense		$	57,271			$	38,664			$	56,873			$	8,553			$	6,547			$	7,050
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Net (gain) loss		$	(19,731	)		$	209,091			$	(89,265	)		$	3,806			$	19,552			$	(2,925	)
Amortization of net (loss)			(33,146	)			(13,848	)			(28,070	)			(3,958	)			(2,146	)			(2,884	)
Amortization of prior service cost			(377	)			—				—				—				(2	)			(3	)
Plan amendment			—				3,067				—				—				—				—
Total recognized in other comprehensive income (loss)		$	(53,254	)		$	198,310			$	(117,335	)		$	(152	)		$	17,404			$	(5,812	)
Total recognized in net periodic benefit cost and other comprehensive income (loss)		$	4,017			$	236,974			$	(60,462	)		$	8,401			$	23,951			$	1,238
Weighted average assumptions for expense purposes:
Discount rate			4.00%				5.00%				4.40%				3.70%				4.80%				4.00%
Expected rate of return on plan assets			6.75%				7.00%				7.00%				N/A				N/A				N/A
Rate of compensation increase			4.00%				4.00%				4.00%				6.00%				6.00%				6.00%

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.

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.

F-24

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 thousands		Funded Plan Expected Benefit Payments				Unfunded Plan Expected Benefit Payments
Fiscal Year
2017		$	32,624			$	3,324
2018			36,341				5,505
2019			40,419				5,778
2020			44,794				34,008
2021			49,427				3,534
2022 through 2026			319,360				22,974

The following table presents the fair value hierarchy (See Note F) for pension assets measured at fair value on a recurring basis as of January 30, 2016:

		Funded Plan
In thousands		Level 1				Level 2				Total
Asset category:
Short-term investments		$	57,713			$	—			$	57,713
Equity Securities			216,526				—				216,526
Fixed Income Securities:
Corporate and government bond funds			—				337,864				337,864
Futures Contracts			—				(33	)			(33	)
Total assets in the fair value hierarchy		$	274,239			$	337,831			$	612,070
Assets measured at net asset value*			—				—				507,772
Fair value of assets		$	274,239			$	337,831			$	1,119,842

*	In accordance with Subtopic 820-10, certain investments that were measured using net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the fair value of assets presented above.

The following table presents the fair value hierarchy for pension assets measured at fair value on a recurring basis as of January 31, 2015:

		Funded Plan
In thousands		Level 1				Level 2				Total
Asset category:
Short-term investments		$	136,276			$	—			$	136,276
Equity Securities			234,765				—				234,765
Fixed Income Securities:
Corporate and government bond funds			—				300,761				300,761
Total assets in the fair value hierarchy		$	371,041			$	300,761			$	671,802
Assets measured at net asset value*			—				—				498,946
Fair value of assets		$	371,041			$	300,761			$	1,170,748

*	In accordance with Subtopic 820-10, certain investments that were measured using net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the fair value of assets presented above.

F-25

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.

Short-term investments are primarily cash related to funding of the plan which had yet to be invested as of balance sheet dates.

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.

Assets measured at net asset value include investments in limited partnerships which 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, cash equivalents or short-term investments are stated at cost which approximates fair value, fair value of 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 guidelines 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 Allocation				January 30, 2016				January 31, 2015
Equity securities			50%				40%				44%
Fixed income			50%				55%				45%
All other – primarily cash			—				5%				11%

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 of plan for eligible employees in Puerto Rico. Assets under the plans totaled $1,314.8 million as of December 31, 2015 and $1,275.4 million as of December 31, 2014, and are invested in a variety of funds. Employees may contribute up to 50% of eligible pay, subject to limitations. TJX matches employee contributions, up to 5% of eligible pay, including a basic match at rates of 25% or 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 $30.8 million in fiscal 2016, $31.2 million in fiscal 2015 and $29.7 million in fiscal 2014 to these employee savings plans. The plans include a TJX stock fund in which participants could invest a portion of TJX’s matching contribution. The TJX stock fund was closed to new investments, other than reinvestment of dividends, at the end of calendar 2015. The TJX stock fund represented 7.1% of plan assets at December 31, 2015, 7.4% of plan assets at December 31, 2014 and 8.3% of plan investments at December 31, 2013.

TJX also has a nonqualified savings plan (the Executive Savings Plan) for certain U.S. employees. TJX matches employee deferrals at various rates which amounted to $1.3 million in fiscal 2016, $3.5 million in fiscal 2015 and $2.4 million in fiscal 2014. 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.

F-26

In addition to the plans described above, TJX also maintains retirement/deferred savings plans for eligible associates at its foreign subsidiaries. We contributed $9.7 million for these plans in fiscal 2016, $9.3 million for these plans in fiscal 2015 and $8.1 million in fiscal 2014.

Multiemployer Pension Plans: TJX contributes to certain multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover union-represented employees. TJX contributed $13.4 million in fiscal 2016, $11.5 million in fiscal 2015 and $11.5 million in fiscal 2014 to the National Retirement Fund (EIN #13-6130178) and was listed in the plan’s Form 5500 as providing more than 5% of the total contributions for the plan year ending December 31, 2014. Based on information TJX received from the plan, the Pension Protection Act Zone Status of the National Retirement Fund is Critical and a rehabilitation plan has been implemented.

The risks of participating in multiemployer pension plans are different from the risks of single-employer pension plans in certain respects, including the following: (a) assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers; (b) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; (c) if we cease to have an obligation to contribute to a multiemployer plan in which we had been a contributing employer, we may be required to pay to the plan an amount based on our allocable share of the underfunded status of the plan, referred to as a withdrawal liability.

Postretirement Medical****: TJX has maintained a postretirement medical plan that provides limited postretirement medical benefits to retirees who are eligible for the defined benefit 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 that was offered to retirees enrolled in the plan at that time.

TJX paid $161,000 of benefits in fiscal 2016 and has a postretirement liability of $1 million as of January 31, 2016, representing the present value of future benefits TJX expected to pay. The amendment to the plan in fiscal 2006 resulted in a negative plan amendment of $46.8 million, which was being amortized over the average remaining life of the active participants. As of January 31, 2016 the unamortized balance of $6.2 million was included in accumulated other comprehensive income (loss). During fiscal 2016 there was a pre-tax benefit of $3.5 million reflected in the consolidated statements of income as it relates to this postretirement medical plan.

During fiscal 2017, TJX decided to terminate the plan and make a discretionary lump sum payment to participants. The settlement of the liability and the recognition of the remaining negative plan amendment is expected to result in a pre-tax benefit of $5.6 million in the first quarter of fiscal 2017.

Note J. Long-Term Debt and Credit Lines

The table below presents long-term debt, exclusive of current installments, as of January 30, 2016 and January 31, 2015. All amounts are net of unamortized debt discounts.

In thousands		January 30, 2016				January 31, 2015
General corporate debt:
6.95% senior unsecured notes, maturing April 15, 2019 (effective interest rate of 6.98% after reduction of unamortized debt discount of $223 and $294 in fiscal 2016 and 2015, respectively)		$	374,777			$	374,706
2.50% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $323 and $367 in fiscal 2016 and 2015, respectively)			499,677				499,633
2.75% senior unsecured notes, maturing June 15, 2021 (effective interest rate of 2.76% after reduction of unamortized debt discount of $400 and $475 in fiscal 2016 and 2015, respectively)			749,600				749,525
Long-term debt		$	1,624,054			$	1,623,864

F-27

The aggregate maturities of long-term debt, exclusive of current installments at January 30, 2016 are as follows:

In thousands		Long-Term Debt
Fiscal Year
2018		$	—
2019			—
2020			375,000
2021			—
Later years			1,250,000
Less amount representing unamortized debt discount			(946	)
Aggregate maturities of long-term debt		$	1,624,054

At January 30, 2016, TJX had outstanding $750 million aggregate principal amount of 2.75% seven-year notes, due June 2021. TJX entered into rate-lock agreements to hedge the underlying treasury rate of all of the 2.75% notes prior to their issuance. The agreements were accounted for as cash flow hedges and the pre-tax realized loss of $7.9 million was recorded as a component of other comprehensive income and is being amortized to interest expense over the term of the notes, resulting in an effective fixed interest rate of 2.91%. In July 2014, TJX used a portion of the proceeds of the 2.75% seven-year notes to redeem the 4.20% notes and recorded a pre-tax loss on the early extinguishment of debt of $16.8 million, which includes $16.4 million of redemption premium and approximately $400,000 to write off unamortized debt expenses and discount.

At January 30, 2016, TJX also had outstanding $500 million aggregate principal amount of 2.50% ten-year notes due May 2023 and $375 million aggregate principal amount of 6.95% ten-year notes due April 2019. TJX entered into rate-lock agreements to hedge the underlying treasury rate of $250 million of the 2.50% notes and all of the 6.95% notes. The cost of these agreements are being amortized to interest expense over the term of the respective notes, resulting in an effective fixed interest rate of 2.57% for the 2.50% notes and 7.00% for the 6.95% notes.

At January 30, 2016, TJX had two $500 million revolving credit facilities, one which was scheduled to mature in June 2017 and one which was scheduled to mature in May 2016. As of January 30, 2016 and January 31, 2015, and during the years then ended, there were no amounts outstanding under these facilities. At January 30, 2016, the agreements required quarterly payments on the unused committed amounts of 6.0 basis points for the agreement maturing in 2017 and 10 basis points for the agreement maturing in 2016. These agreements had no compensating balance requirements and had various covenants. Each of these facilities required 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 1.00 on a rolling four-quarter basis. TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented. In March 2016, the $500 million revolving credit facility scheduled to mature in May 2016 was replaced with a new five-year $500 million revolving credit facility maturing in March 2021 and the $500 million revolving credit facility scheduled to mature in June 2017 was replaced with a new four-year $500 million revolving credit facility maturing in March 2020. The terms and covenants under the new revolving credit facilities are similar to those in the terminated facilities and require quarterly payments of 6.0 basis points on the committed amounts for both agreements. This rate is based on the credit ratings of TJX’s long-term debt and will vary with specified changes in the credit ratings.

As of January 30, 2016 and January 31, 2015, 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. As of January 30, 2016 and January 31, 2015 and during the years then ended, there were no amounts outstanding on the Canadian credit line for operating expenses. As of January 30, 2016 and January 31, 2015, our European business at TJX International had a credit line of £5million and £20 million, respectively. As of January 30, 2016 and January 31, 2015 and during the years then ended, there were no amounts outstanding on this U.K. credit line.

F-28

Note K. Income Taxes

For financial reporting purposes, components of income before income taxes are as follows:

		Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				February 1, 2014
United States		$	3,102,304			$	2,943,745			$	2,746,925
Foreign			555,996				606,139				572,564
Income before provision for income taxes		$	3,658,300			$	3,549,884			$	3,319,489

The provision for income taxes includes the following:

		Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				February 1, 2014
Current:
Federal		$	992,094			$	896,672			$	815,811
State			208,357				180,616				177,009
Foreign			149,408				155,398				136,626
Deferred:
Federal			34,620				87,057				73,206
State			(9,979	)			14,231				5,928
Foreign			6,142				782				(26,487	)
Provision for income taxes		$	1,380,642			$	1,334,756			$	1,182,093

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

		Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015
Deferred tax assets:
Net operating loss carryforward		$	18,872			$	18,305
Reserves for lease obligations and computer intrusion			7,623				16,242
Pension, stock compensation, postretirement and employee benefits			380,523				351,171
Leases			51,823				47,464
Other			91,575				74,451
Total gross deferred tax assets		$	550,416			$	507,633
Valuation allowance			(11,998	)			(5,122	)
Net deferred tax asset		$	538,418			$	502,511
Deferred tax liabilities:
Property, plant and equipment		$	539,818			$	474,179
Capitalized inventory			47,374				50,536
Tradename/intangibles			49,111				47,443
Undistributed foreign earnings			167,968				181,822
Other			5,418				8,884
Total deferred tax liabilities		$	809,689			$	762,864
Net deferred tax (liability)		$	(271,271	)		$	(260,353	)
Non-current asset		$	13,831			$	22,532
Non-current liability			(285,102	)			(282,885	)
Total		$	(271,271	)		$	(260,353	)

In November 2015, the FASB issued ASU 2015-17, “Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes.” This guidance requires deferred tax liabilities, deferred tax assets and valuation allowances be classified as non-current in a classified balance sheet. This ASU is effective for annual reporting periods beginning after December 15, 2016 and interim periods within those annual periods. Early adoption is permitted and may be

F-29

applied either prospectively or retrospectively to all periods presented. TJX has elected to early adopt the new reporting standard retrospectively on its fiscal 2016 consolidated financial statements. The classification for deferred tax assets (liabilities) for fiscal 2015 has been recast to reflect the new reporting standard. Current asset, non-current asset and non-current liability balances were $137.6 million, $24.6 million and $422.5 million, respectively on the original financial statements for fiscal 2015.

TJX has provided for deferred U.S. taxes on all undistributed earnings through January 30, 2016 from its subsidiaries in Canada, Puerto Rico, Italy, India and Hong Kong. For all other foreign subsidiaries, no income taxes have been provided on the approximately $727 million of undistributed earnings as of January 30, 2016 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 January 30, 2016, TJX had available for state income tax purposes net operating loss carryforwards of $62.4 million which expire, if unused, in the years 2017 through 2035. As of January 31, 2015, TJX had available for state income tax purposes net operating loss carryforwards of $61.5 million. TJX 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 of $5.1 million has been provided for the deferred tax asset as of January 30, 2016, and $5.1 million as of January 31, 2015.

As of January 30, 2016, the Company had available for foreign income tax purposes (primarily related to Germany, Australia, Austria and the Netherlands) net operating loss carryforwards of $51.1 million, of which $3.9 million will expire, if unused, in fiscal 2025. The remaining loss carryforwards do not expire. For the deferred tax assets associated with the net operating loss carryforwards for which management has determined it is more likely than not that the deferred tax assets will not be realized, TJX had valuation allowances recorded of approximately $6.9 million. As of January 31, 2015, the Company had available for foreign income tax purposes (primarily related to Germany and Poland) net operating loss carryforwards of $48.3 million.

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
		January 30, 2016				January 31, 2015				February 1, 2014
U.S. federal statutory income tax rate			35.0	%			35.0	%			35.0	%
Effective state income tax rate			3.5				3.6				3.6
Impact of foreign operations			(0.7	)			(0.9	)			(0.8	)
All other			(0.1	)			(0.1	)			(2.2	)
Worldwide effective income tax rate			37.7	%			37.6	%			35.6	%

TJX’s effective income tax rate increased for fiscal 2016 as compared to fiscal 2015. The increase in the effective income tax rate was primarily due to the jurisdictional mix of income and the increase in valuation allowance on foreign net operating losses.

TJX had net unrecognized tax benefits (net of federal benefit on state issues) of $34.1 million as of January 30, 2016, $32.7 million as of January 31, 2015 and $26.2 million as of February 1, 2014.

F-30

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

		Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				February 1, 2014
Balance at beginning of year		$	55,619			$	48,680			$	148,777
Additions for uncertain tax positions taken in current year			2,248				4,771				4,212
Additions for uncertain tax positions taken in prior years			11,707				5,278				5,096
Reductions for uncertain tax positions taken in prior years			(23,874	)			(2,747	)			(69,292	)
Reductions resulting from lapse of statute of limitations			(389	)			—				(317	)
Settlements with tax authorities			(1,985	)			(363	)			(39,796	)
Balance at end of year		$	43,326			$	55,619			$	48,680

Included in the gross amount of unrecognized tax benefits are items that will impact future effective tax rates upon recognition. These items amounted to $39.0 million as of January 30, 2016, $34.8 million as of January 31, 2015 and $27.8 million as of February 1, 2014.

TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In the U.S., fiscal years through 2010 are no longer subject to examination. In Canada, fiscal years through 2007 are no longer subject to examination. In all other jurisdictions, fiscal years through 2009 are no longer subject to examination.

TJX follows the with and without approach for direct and indirect effects of windfall tax deductions. 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 $1.6 million for the year ended January 30, 2016, $1.9 million for the year ended January 31, 2015 and $4.0 million for the year ended February 1, 2014. The accrued amounts for interest and penalties are $7.0 million as of January 30, 2016, $10.1 million as of January 31, 2015 and $8.1 million as of February 1, 2014.

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 January 30, 2016. During the next twelve months, it is reasonably possible that state tax audit resolutions may reduce unrecognized tax benefits by $0 to $11 million, which would reduce the provision for taxes on earnings.

Note L. 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 in Europe, some of which have options to extend. Many of the Company’s leases contain escalation clauses and we have the right to terminate some of the leases before the expiration date under specified circumstances and some with specified payments. 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 2016, fiscal 2015 and fiscal 2014 and are not included in the table below.

The following is a schedule of future minimum lease payments for continuing operations as of January 30, 2016:

In thousands		Operating Leases
Fiscal Year
2017		$	1,368,050
2018			1,273,888
2019			1,150,172
2020			1,005,127
2021			845,910
Later years			2,354,674
Total future minimum lease payments		$	7,997,821

F-31

Rental expense under operating leases for continuing operations amounted to $1,365.6 million for fiscal 2016, $1,321.6 million for fiscal 2015 and $1,238.2 million for fiscal 2014. Rental expense includes contingent rent and is reported net of sublease income. Contingent rent paid was $15.7 million in fiscal 2016, $15.2 million in fiscal 2015 and $15.7 million in fiscal 2014. Sublease income was $0.9 million in fiscal 2016, $0.8 million in fiscal 2015 and $0.9 million in fiscal 2014.

As of January 30, 2016 we have two lease agreements for facilities that resulted in TJX being considered the owner of the property for accounting purposes (see Lease Accounting within Note A). One of the leases is for our home office facility in Canada which did not meet the sale-leaseback criteria and is therefore being accounted for as a financing transaction. The other lease relates to a facility under construction in Europe. Upon completion, a sale-leaseback analysis will be performed to determine if the Company should record a sale to remove the assets and related obligation and record the lease as either an operating or capital lease obligation. The assets related to these properties are included in “land and buildings” and the related liabilities of $85.2 million are included in “other long-term liabilities.”

TJX had outstanding letters of credit totaling $29.3 million as of January 30, 2016 and $42.9 million as of January 31, 2015. Letters of credit are issued by TJX primarily for the purchase of inventory.

Note M. 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 thousands		January 30, 2016				January 31, 2015
Employee compensation and benefits, current		$	573,965			$	470,887
Dividends payable			141,295				120,980
Accrued capital additions			132,871				99,487
Rent, utilities and occupancy, including real estate taxes			202,653				205,819
Merchandise credits and gift certificates			307,350				274,557
Insurance			65,983				38,514
Sales tax collections and V.A.T. taxes			134,535				118,821
All other current liabilities			511,007				467,057
Accrued expenses and other current liabilities		$	2,069,659			$	1,796,122

All other current liabilities include accruals for advertising, customer rewards liability, interest, reserve for sales returns, reserve for taxes, fair value of derivatives, 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 thousands		January 30, 2016				January 31, 2015
Employee compensation and benefits, long term		$	418,156			$	460,086
Accrued rent			216,040				203,216
Landlord allowances			93,024				97,861
Tax reserve, long term			33,403				28,088
Financing lease obligations			85,214				60,733
All other long-term liabilities			35,184				38,153
Other long-term liabilities		$	881,021			$	888,137

Note N. 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,

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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 may also be contingently liable on up to nine leases of former TJX businesses which we believe the likelihood of future liability to TJX is remote.

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 $42.6 million as of January 30, 2016. 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. TJX is also a defendant in lawsuits filed in federal courts brought as putative class actions on behalf of customers relating to TJX’s compare at pricing. 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 O. Supplemental Cash Flows Information

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

		Fiscal Year Ended
In thousands		January 30, 2016				January 31, 2015				February 1, 2014
Cash paid for:
Interest on debt		$	64,188			$	66,265			$	52,196
Income taxes			1,301,122				1,091,128				1,240,377
Changes in accrued expenses due to:
Dividends payable		$	20,315			$	17,377			$	19,380
Property additions			33,384				8,254				(6,432	)
Non-cash investing and financing activity:
Construction in progress		$	(30,767	)		$	(60,733	)		$	—
Financing lease obligation			30,767				60,733				—

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Note P. Selected Quarterly Financial Data (Unaudited)

Presented below is selected quarterly consolidated financial data for fiscal 2016 and fiscal 2015 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 amounts		First Quarter				Second Quarter				Third Quarter				Fourth Quarter
Fiscal Year Ended January 30, 2016
Net sales		$	6,865,637			$	7,363,731			$	7,753,495			$	8,962,075
Gross earnings(1)			1,945,396				2,144,540				2,246,596				2,573,883
Net income			474,601				549,335				587,256				666,466
Basic earnings per share			0.70				0.81				0.88				1.00
Diluted earnings per share			0.69				0.80				0.86				0.99
Fiscal Year Ended January 31, 2015
Net sales		$	6,491,176			$	6,917,212			$	7,366,066			$	8,303,953
Gross earnings(1)			1,813,176				1,981,356				2,162,437				2,344,916
Net income			454,317				517,624				594,957				648,230
Basic earnings per share			0.65				0.75				0.86				0.95
Diluted earnings per share			0.64				0.73				0.85				0.93

(1)	Gross earnings equal net sales less cost of sales, including buying and occupancy costs.

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