TJX filing — read by section

Item 9A. Controls and Procedures

ITEM 9A. Controls and Procedures 
 (a) Evaluation of Disclosure Controls and Procedures 
 We have carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this report pursuant to Rules 13a-15 and 15d-15 of the Exchange Act. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective at a reasonable assurance level in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms; and (ii) accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of implementing controls and procedures. 
 (b) Changes in Internal Control Over Financial Reporting 
 There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth quarter of fiscal 2021 identified in connection with our Chief Executive Officer’s and Chief Financial Officer’s evaluation that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 
 (c) Management’s Annual Report on Internal Control Over Financial Reporting 
 Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, our principal executive and principal financial officers, or persons performing similar functions, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes those policies and procedures that: 
 – Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of TJX; 
 – Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of TJX are being made only in accordance with authorizations of management and directors of TJX; and 
 – Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of TJX’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. 
 Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of January 30, 2021 based on criteria established in Internal Control—Integrated Framework 2013 issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, management concluded that its internal control over financial reporting was effective as of January 30, 2021. 
 PricewaterhouseCoopers LLP, the independent registered public accounting firm that audited and reported on the consolidated financial statements contained herein, has audited the effectiveness of our internal control over financial reporting as of January 30, 2021, and has issued an attestation report on the effectiveness of our internal controls over financial reporting included herein. 
 
 ITEM 9B. Other Information 
 Not applicable. 
 41 

 
 
 

 PART III 
 
 ITEM 10. Directors, Executive Officers and Corporate Governance 
 The information concerning our executive officers is set forth under the heading “Information about our Executive Officers” in Part I of this report. TJX will file with the Securities and Exchange Commission (SEC) a definitive proxy statement no later than 120 days after the close of its fiscal year ended January 30, 2021 ("Proxy Statement"). The other information required by this Item and not given in this Item will appear under the headings “Election of Directors” and “Corporate Governance,” including in “Board Leadership and Committees,” and “Audit Committee Report” and, if applicable, “Beneficial Ownership” and “Delinquent Section 16(a) Reports” in our Proxy Statement, which sections are incorporated herein by reference. 
 In addition to our Global Code of Conduct, TJX has a Code of Ethics for TJX Executives governing its Executive Chairman, Chief Executive Officer and President, Chief Financial Officer, Principal Accounting Officer and other senior operating, financial and legal executives. The Code of Ethics for TJX Executives is designed to ensure integrity in TJX’s financial reports and public disclosures. TJX also has a Directors Code of Business Conduct and Ethics which promotes honest and ethical conduct, compliance with applicable laws, rules and regulations and the avoidance of conflicts of interest. Both of these codes of conduct are published at tjx.com. We intend to disclose any future amendments to, or waivers from, the Code of Ethics for TJX Executives or the Directors Code of Business Conduct and Ethics within four business days of the waiver or amendment through a website posting or by filing a Current Report on Form 8-K with the SEC. 
 
 ITEM 11. Executive Compensation 
 The information required by this Item will appear under the headings “Compensation Discussion and Analysis,” “Compensation Tables,” “Director Compensation” and “Compensation Program Risk Assessment” in our Proxy Statement, which sections are incorporated herein by reference. 
 
 ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 
 The information required by this Item will appear under the headings “Equity Compensation Plan Information” and “Beneficial Ownership” in our Proxy Statement, which sections are incorporated herein by reference. 
 
 ITEM 13. Certain Relationships and Related Transactions, and Director Independence 
 The information required by this Item will appear under the heading “Corporate Governance,” including in “Transactions with Related Persons” and “Board Independence,” in our Proxy Statement, which section is incorporated herein by reference. 
 
 ITEM 14. Principal Accountant Fees and Services 
 The information required by this Item will appear under the headings “Audit Committee Report” and “Auditor Fees” in our Proxy Statement, which sections are incorporated herein by reference. 
 42 

 
 
 

 PART IV 
 
 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 millions 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, 2021 
 $ 109 $ 3,530 $ 3,471 $ 168 
 Fiscal Year Ended February 1, 2020 
 $ 104 $ 4,862 $ 4,857 $ 109 
 Fiscal Year Ended February 2, 2019 
 $ 103 $ 4,862 $ 4,861 $ 104 

 
 
 43 

 
 
 

 (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. 
 
 Incorporate by Reference 
 Exhibit No. Description Form Exhibit No. Filing
 Date 
 3(i).1 Fifth Restated Certificate of Incorporation 
 10-K 3(i).1 4/3/2019 
 3(ii).1 By-laws of TJX, as amended 
 8-K 3.1 2/5/2018 
 4.01 Indenture between TJX and U.S. Bank National Association dated as of April 2, 2009 (File No. 333-158360) 
 S-3 4.1 4/2/2009 
 4.02 Third Supplemental Indenture dated as of May 2, 2013 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto 
 8-K 4.2 5/2/2013 
 4.03 Fourth Supplemental Indenture dated as of June 5, 2014 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto 
 8-K 4.2 6/5/2014 
 4.04 Indenture between TJX and U.S. Bank National Association dated September 12, 2016 
 8-K 4.1 9/12/2016 
 4.05 First Supplemental Indenture dated as of September 12, 2016 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto 
 8-K 4.2 9/12/2016 
 4.06 Indenture dated as of April 1, 2020 between The TJX Companies, Inc. and U.S. Bank National Association, as Trustee 
 8-K 4.1 4/1/2020 
 4.07 First Supplemental Indenture, dated as of April 1, 2020 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto. 
 8-K 4.2 4/1/2020 
 4.08 Second Supplemental Indenture, dated as of April 1, 2020 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto. 
 8-K 4.3 4/1/2020 
 4.09 Third Supplemental Indenture, dated as of April 1, 2020 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto. 
 8-K 4.4 4/1/2020 
 4.10 Fourth Supplemental Indenture, dated as of April 1, 2020 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto. 
 8-K 4.5 4/1/2020 
 4.11 Fifth Supplemental Indenture, dated as of November 30, 2020 by and between TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto. 
 8-K 4.1 12/3/2020 
 4.12 Sixth Supplemental Indenture, dated as of November 30, 2020 by and TJX and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto. 
 8-K 4.2 12/3/2020 
 4.13 Description of Registrant's Securities . 
 10-K 4.06 3/27/2020 
 10.01 The Executive Severance Plan effective September 27, 2018* 
 10-Q 10.2 12/4/2018 
 10.02 The Executive Severance Plan Participation Agreement dated September 27, 2018 between Carol Meyrowitz and TJX* 
 10-Q 10.3 12/4/2018 
 10.03 The Employment Agreement dated February 1, 2019 between Carol Meyrowitz and TJX * 
 10-K 10.03 4/3/2019 
 10.04 The Executive Severance Plan Participation Agreement dated September 27, 2018 between Ernie Herrman and TJX* 
 10-Q 10.4 12/4/2018 
 10.05 The Employment Agreement dated February 1, 2019 between Ernie Herrman and TJX * 
 10-K 10.05 4/3/2019 
 10.06 The Employment Agreement dated February 2, 2018 between Richard Sherr and TJX* 
 10-K 10.4 4/4/2018 
 10.07 The Executive Severance Plan Participation Agreement dated September 27, 2018 between Richard Sherr and TJX* 
 10-Q 10.6 12/4/2018 
 10.08 The Amendment to the Employment Agreement between Richard Sherr and TJX effective as of February 13, 2019* 
 10-K 10.10 4/3/2019 
 10.09 The Amendment to the Employment Agreement between Richard Sherr and TJX effective as of January 29, 2021, filed herewith* 
 
 10.10 The Employment Agreement dated February 2, 2018 between Scott Goldenberg and TJX* 
 10-K 10.5 4/4/2018 
 10.11 The Executive Severance Plan Participation Agreement dated September 27, 2018 between Scott Goldenberg and TJX* 
 10-Q 10.5 12/4/2018 

 44 

 
 

 
 Incorporate by Reference 
 Exhibit No. Description Form Exhibit No. Filing
 Date 
 10.12 The Amendment to the Employment Agreement between Scott Goldenberg and TJX effective as of February 13, 2019* 
 10-K 10.13 4/3/2019 
 10.13 The Amendment to the Employment Agreement between Scott Goldenberg and TJX effective as of January 29, 2021, filed herewith* 
 
 10.14 The Employment Agreement dated February 2, 2018 between Kenneth Canestrari and TJX* 
 10-K 10.6 4/4/2018 
 10.15 The Executive Severance Plan Participation Agreement dated September 27, 2018 between Kenneth Canestrari and TJX* 
 10-Q 10.7 12/4/2018 
 10.16 The Amendment to the Employment Agreement between Kenneth Canestrari and TJX effective as of February 13, 2019* 
 10-K 10.16 4/3/2019 
 10.17 The Amendment to the Employment Agreement between Kenneth Canestrari and TJX effective as of January 29, 2021, filed herewith* 
 
 10.18 The Employment Agreement dated January 16, 2018 between Douglas Mizzi and TJX* 
 10-K 10.7 4/4/2018 
 10.19 The Executive Severance Plan Participation Agreement dated September 27, 2018 between Douglas Mizzi and TJX* 
 10-Q 10.8 12/4/2018 
 10.20 The Amendment to the Employment Agreement between Douglas Mizzi and TJX effective as of February 13, 2019* 
 10-K 10.19 4/3/2019 
 10.21 The Amendment to the Employment Agreement between Douglas Mizzi and TJX effective as of January 29, 2021, filed herewith* 
 
 10.22 The Stock Incentive Plan (2013 Restatement)* 
 10-Q 10.1 5/31/2013 
 10.23 The First Amendment to the Stock Incentive Plan (2013 Restatement) effective as of June 7, 2016* 
 10-Q 10.1 8/26/2016 
 10.24 The Second Amendment to the Stock Incentive Plan (2013 Restatement) effective as of January 29, 2017* 
 10-K 10.8 3/28/2017 
 10.25 The Third Amendment to the Stock Incentive Plan (2013 Restatement) effective as of November 6, 2018* 
 10-K 10.23 4/3/2019 
 10.26 The Stock Incentive Plan Rules for U.K. Employees, effective as of September 17, 2018* 
 10-Q 10.1 12/4/2018 
 10.27 The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 9, 2010* 
 10-Q 10.2 11/24/2010 
 10.28 The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 9, 2010* 
 10-K 10.19 3/27/2012 
 10.29 The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 20, 2012* 
 10-Q 10.1 11/29/2012 
 10.30 The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 20, 2012* 
 10-Q 10.2 11/29/2012 
 10.31 The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 19, 2013* 
 10-Q 10.1 12/3/2013 
 10.32 The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 19, 2013* 
 10-Q 10.2 12/3/2013 
 10.33 The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 10, 2014* 
 10-Q 10.4 12/2/2014 
 10.34 The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 10, 2014* 
 10-Q 10.5 12/2/2014 
 10.35 The Form of Non-Qualified Stock Option Certificate granted under the Stock Incentive Plan as of September 17, 2015* 
 10-Q 10.1 12/1/2015 
 10.36 The Form of Non-Qualified Stock Option Terms and Conditions granted under the Stock Incentive Plan as of September 17, 2015* 
 10-Q 10.2 12/1/2015 
 10.37 The Restricted Stock Unit Award granted under the Stock Incentive Plan on January 29, 2016 to Ernie Herrman* 
 10-K 10.19 3/29/2016 
 10.38 The Form of Performance Share Unit Award granted under the Stock Incentive Plan as of April 3, 2018* 
 10-Q 10.1 6/1/2018 
 10.39 The Form of Restricted Stock Unit Award granted under the Stock Incentive Plan as of April 3, 2018* 
 10-Q 10.2 6/1/2018 
 10.40 The Form of Performance Share Unit Award granted under the Stock Incentive Plan as of April 1, 2019* 
 10-Q 10.01 5/31/2019 
 10.41 The Form of Restricted Stock Unit Award granted under the Stock Incentive Plan as of April 1, 2019* 
 10-Q 10.02 5/31/2019 

 45 

 
 

 
 Incorporate by Reference 
 Exhibit No. Description Form Exhibit No. Filing
 Date 
 10.42 The Form of Deferred Stock Award for Directors granted under the Stock Incentive Plan* 
 10-K 10.20 3/31/2015 
 10.43 The Form of Deferred Stock Award for Directors granted under the Stock Incentive Plan as of June 7, 2016* 
 10-Q 10.2 8/26/2016 
 10.44 The Management Incentive Plan and Long Range Performance Incentive Plan (2013 Restatement)* 
 10-K 10.22 4/2/2013 
 10.45 The General Deferred Compensation Plan (1998 Restatement) (the GDCP) and First Amendment to the GDCP, effective January 1, 1999* 
 10-K 10.9 4/29/1999 
 10.46 The Second Amendment to the GDCP, effective January 1, 2000* 
 10-K 10.10 4/28/2000 
 10.47 The Third and Fourth Amendments to the GDCP* 
 10-K 10.17 3/29/2006 
 10.48 The Fifth Amendment to the GDCP, effective January 1, 2008* 
 10-K 10.17 3/31/2009 
 10.49 The Supplemental Executive Retirement Plan (2015 Restatement)* 
 10-Q 10.3 5/29/2015 
 10.50 The Executive Savings Plan (As Amended and Restated, Effective January 1, 2015) (the ESP)* 
 10-K 10.25 3/31/2015 
 10.51 The First Amendment to the ESP, dated December 30, 2015* 
 10-K 10.25 3/29/2016 
 10.52 The Form of TJX Indemnification Agreement for its executive officers and directors*(p) 10-K 10(r) 4/27/1990 
 10.53 The Trust Agreement dated as of April 8, 1988 between TJX and State Street Bank and Trust Company*(p) 10-K 10(y) 4/28/1988 
 10.54 The Trust Agreement dated as of April 8, 1988 between TJX and Fleet Bank (formerly Shawmut Bank of Boston, N.A.)*(p) 10-K 10(z) 4/28/1988 
 10.55 The Trust Agreement for Executive Savings Plan dated as of October 23, 2015 between TJX and Vanguard Fiduciary Trust Company* 
 10-Q 10.5 10/31/2015 
 10.56 First Amendment to 2022 Revolving Credit Agreement, dated as of May 10, 2019, by and among TJX, U.S. Bank National Association, as administrative agent, and each of the lenders party thereto 
 10-K 10.55 3/27/2020 
 10.57 Second Amendment to 2022 Revolving Credit Agreement, dated as of May 15, 2020, by and among The TJX Companies, Inc., the lenders party thereto and U.S. Bank National Association, as administrative agent. 
 8-K 10.1 5/21/2020 
 10.58 Third Amendment to 2022 Revolving Credit Agreement, dated as of November 24, 2020, by and among The TJX Companies, Inc., the lenders party thereto and U.S. Bank National Association, as administrative agent, filed herewith 
 
 10.59 First Amendment to 2024 Revolving Credit Agreement, dated as of May 10, 2019, by and among TJX, U.S. Bank National Association, as administrative agent, and each of the lenders party thereto 
 10-K 10.56 3/27/2020 
 10.60 Second Amendment to 2024 Revolving Credit Agreement, dated as of May 15, 2020, by and among TJX, the lender party thereto and U.S. Bank National Association, as administrative agent 
 8-K 10.2 5/21/2020 
 10.61 Third Amendment to 2024 Revolving Credit Agreement, dated as of November 24, 2020, by and among TJX, the lender party thereto and U.S. Bank National Association, as administrative agent, filed herewith 
 
 10.62 364 Day Revolving Credit Agreement, dated August 10, 2020, by and among The TJX Companies, Inc., the lenders from time to time party thereto, Bank of America, N.A., as syndication agent, U.S. Bank National Association, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as co-documentation agents, and BofA Securities, Inc., U.S. Bank National Association, Deutsche Bank Securities Inc., HSBC Bank USA, National Association, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as lead arrangers and bookrunners. 
 8-K 10.1 8/11/2020 
 10.63 First Amendment to 364 Day Revolving Credit Agreement, dated November 24, 2020, by and among The TJX Companies, Inc., the lenders from time to time party thereto, Bank of America, N.A., as syndication agent, U.S. Bank National Association, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as co-documentation agents, and BofA Securities, Inc., U.S. Bank National Association, Deutsche Bank Securities Inc., HSBC Bank USA, National Association, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as lead arrangers and bookrunners, filed herewith 
 
 21 Subsidiaries of TJX, filed herewith 
 
 23 Consent of Independent Registered Public Accounting Firm, filed herewith 
 
 24 Power of Attorney given by the Directors and certain Executive Officers of TJX, filed herewith 
 
 31.1 Certification Statement of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith 
 

 46 

 
 

 
 Incorporate by Reference 
 Exhibit No. Description Form Exhibit No. Filing
 Date 
 31.2 Certification Statement of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith 
 
 32.1 Certification Statement of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith 
 
 32.2 Certification Statement of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 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, 2021, formatted in Inline Extensible Business Reporting Language (iXBRL): (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 
 
 104 The cover page from The TJX Companies, Inc.'s Annual Report on Form 10-K for the fiscal year ended January 30, 2021, formatted in iXBRL (included in Exhibit 101) 
 

 * Management contract or compensatory plan or arrangement. 
 (p) Paper filing. 
 Unless otherwise indicated, exhibits incorporated by reference were filed under Commission File Number 001-04908. 
 
 ITEM 16. Form 10-K Summary 
 Not applicable. 
 47 

 
 
 

 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. 
 
 
 
 /s/ SCOTT GOLDENBERG 
 Dated: March 31, 2021 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 /s/ SCOTT GOLDENBERG 
 Ernie Herrman, Chief Executive Officer, President and Director (Principal Executive Officer) Scott Goldenberg, Chief Financial Officer
(Principal Financial and Accounting Officer) 
 
 ZEIN ABDALLA* MICHAEL F. HINES* 
 Zein Abdalla, Director Michael F. Hines, Director 
 
 JOSÉ B. ALVAREZ* AMY B. LANE* 
 José B. Alvarez, Director Amy B. Lane, Director 
 
 ALAN M. BENNETT* CAROL MEYROWITZ* 
 Alan M. Bennett, Director Carol Meyrowitz, Executive Chairman of the Board of Directors 
 
 ROSEMARY T. BERKERY* JACKWYN L. NEMEROV* 
 Rosemary T. Berkery, Director Jackwyn L. Nemerov, Director 
 
 DAVID T. CHING* JOHN F. O’BRIEN* 
 David T. Ching, Director John F. O’Brien, Director 
 
 C. KIM GOODWIN* WILLOW B. SHIRE* 
 C. Kim Goodwin, Director Willow B. Shire, Director 

 
 
 
 
 
 
 *BY /s/ SCOTT GOLDENBERG 
 Dated: March 31, 2021 Scott Goldenberg,
as attorney-in-fact 

 
 
 48 

 
 
 

 
 
 
 The TJX Companies, Inc. 
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS 
 For Fiscal Years Ended January 30, 2021, February 1, 2020 and February 2, 2019. 
 
 
 Report of Independent Registered Public Accounting Firm 
 F- 2 
 
 Consolidated Financial Statements: 
 Consolidated Statements of Income 
 F- 4 
 
 Consolidated Statements of Comprehensive Income 
 F- 5 
 
 Consolidated Balance Sheets 
 F- 6 
 
 Consolidated Statements of Cash Flows 
 F- 7 
 
 Consolidated Statements of Shareholders’ Equity 
 F- 8 
 
 Notes to Consolidated Financial Statements 
 F- 9 
 
 Financial Statement Schedules: 
 Schedule II – Valuation and Qualifying Accounts 
 43 
 

 
 
 F-1 

 
 
 

 Report of Independent Registered Public Accounting Firm 
 To the Board of Directors and Shareholders of The TJX Companies, Inc. 
 
 
 Opinions on the Financial Statements and Internal Control over Financial Reporting 
 We have audited the accompanying consolidated balance sheets of The TJX Companies, Inc. and its subsidiaries (the “Company”) as of January 30, 2021 and February 1, 2020, and the related consolidated statements of income, of comprehensive income, of shareholders' equity and of cash flows for each of the three years in the period ended January 30, 2021, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended January 30, 2021 appearing under Item 15(a) (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of January 30, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 
 In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 30, 2021 and February 1, 2020, and the results of its operations and its cash flows for each of the three years in the period ended January 30, 2021 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 30, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. 
 Change in Accounting Principle 
 As discussed in Note A to the consolidated financial statements, the Company changed the manner in which it accounts for leases as of February 3, 2019. 
 Basis for Opinions 
 The Company's management is responsible for these consolidated financial statements, 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 the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. 
 We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. 
 Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. 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. 
 Definition and Limitations of Internal Control over Financial Reporting 
 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. 
 F-2 

 
 

 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. 
 Critical Audit Matters 
 The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 
 Income Tax (Benefit) Provision 
 As described in Note L to the consolidated financial statements, the Company recorded a benefit for income taxes of $1.2 million for the year ended January 30, 2021, has a deferred tax asset net of deferred tax liability of $90 million, including a valuation allowance of $77 million, as of January 30, 2021 and total gross unrecognized tax benefits of $269 million as of January 30, 2021, of which $250 million would affect the Company’s effective tax rate if recognized in a future period. The Company is subject to taxation in the United States, as well as various state, local and foreign jurisdictions. The use of estimates and judgments, as well as the interpretation and application of complex tax laws is required by management to determine its (benefit) provision for income taxes. 
 The principal considerations for our determination that performing procedures relating to the (benefit) provision for income taxes is a critical audit matter are the (i) the significant judgment by management when determining the (benefit) provision for income taxes, which led to (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures relating to the (benefit) provision for income taxes. 
 Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the (benefit) provision for income taxes. These procedures also included, among others (i) testing the (benefit) provision for income taxes, including the rate reconciliation and current and deferred tax (benefit) provision, and (ii) evaluating the completeness of uncertain tax positions, including application of foreign and domestic tax laws and regulations. 
 
 
 
 
 /s/PricewaterhouseCoopers LLP 
 Boston, Massachusetts 
 March 31, 2021 
 
 
 We have served as the Company’s auditor since 1962. 
 F-3 

 
 
 

 THE TJX COMPANIES, INC. 
 CONSOLIDATED STATEMENTS OF INCOME 
 IN THOUSANDS EXCEPT PER SHARE AMOUNTS 
 
 
 Fiscal Year Ended 
 January 30,
2021 February 1,
2020 February 2,
2019 
 
 
 Net sales $ 32,136,962 $ 41,716,977 $ 38,972,934 
 Cost of sales, including buying and occupancy costs 24,533,815 29,845,780 27,831,177 
 Selling, general and administrative expenses 7,020,917 7,454,988 6,923,564 
 Loss on early extinguishment of debt 312,233 — — 
 
 Interest expense, net 180,734 10,026 8,860 
 Pension settlement charge — — 36,122 
 Income before income taxes 89,263 4,406,183 4,173,211 
 Benefit (provision) for income taxes 1,207 ( 1,133,990 ) ( 1,113,413 ) 
 Net income $ 90,470 $ 3,272,193 $ 3,059,798 
 
 Basic earnings per share $ 0.08 $ 2.71 $ 2.47 
 Weighted average common shares – basic 1,199,927 1,208,163 1,241,153 
 
 Diluted earnings per share $ 0.07 $ 2.67 $ 2.43 
 Weighted average common shares – diluted 1,214,703 1,226,519 1,259,252 

 The accompanying notes are an integral part of the financial statements. 
 F-4 

 
 
 

 THE TJX COMPANIES, INC. 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 
 IN THOUSANDS 
 
 
 Fiscal Year Ended 
 January 30,
2021 February 1,
2020 February 2,
2019 
 
 
 Net income $ 90,470 $ 3,272,193 $ 3,059,798 
 Additions to other comprehensive income (loss): 
 Foreign currency translation adjustments, net of related tax provision of $ 2,442 in fiscal 2021 and tax benefits of $ 1,189 and $ 8,233 in fiscal 2020 and 2019, respectively 
 15,588 ( 3,943 ) ( 192,664 ) 
 Gain on net investment hedges, net of related tax provision of $ 7,113 in fiscal 2019 
 — — 19,538 
 Recognition of net gains/losses on benefit obligations, net of related tax provision of $ 9,974 in fiscal 2021 and tax benefits of $ 20,489 and $ 19,813 in fiscal 2020 and 2019, respectively 
 30,635 ( 56,275 ) ( 54,420 ) 
 Reclassifications from other comprehensive loss to net income: 
 Pension settlement charge, net of related tax provision of $ 9,641 in fiscal 2019 
 — — 26,481 
 Amortization of loss on cash flow hedge, net of related tax provisions of $ 303 , $ 303 , and $ 304 in fiscal 2021, 2020 and 2019, respectively 
 831 831 847 
 Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $ 7,298 , $ 6,019 , and $ 4,280 , in fiscal 2021, 2020 and 2019, respectively 
 20,046 16,537 11,756 
 Other comprehensive income (loss), net of tax 67,100 ( 42,850 ) ( 188,462 ) 
 Total comprehensive income $ 157,570 $ 3,229,343 $ 2,871,336 

 The accompanying notes are an integral part of the financial statements. 
 F-5 

 
 
 

 THE TJX COMPANIES, INC. 
 CONSOLIDATED BALANCE SHEETS 
 IN THOUSANDS EXCEPT PER SHARE AMOUNTS 
 
 
 
 Fiscal Year Ended 
 January 30,
2021 February 1,
2020 
 ASSETS 
 Current assets: 
 Cash and cash equivalents $ 10,469,570 $ 3,216,752 
 
 Accounts receivable, net 461,139 386,261 
 Merchandise inventories 4,337,389 4,872,592 
 Prepaid expenses and other current assets 434,977 368,048 
 Federal, state and foreign income taxes recoverable 36,262 46,969 
 Total current assets 15,739,337 8,890,622 
 Net property at cost 5,036,096 5,325,048 
 Non-current deferred income taxes, net 127,191 12,132 
 Operating lease right of use assets 8,989,998 9,060,332 
 Goodwill 98,998 95,546 
 Other assets 821,935 761,323 
 TOTAL ASSETS $ 30,813,555 $ 24,145,003 
 LIABILITIES 
 Current liabilities: 
 Accounts payable $ 4,823,397 $ 2,672,557 
 Accrued expenses and other current liabilities 3,471,459 3,041,774 
 Current portion of operating lease liabilities 1,677,605 1,411,216 
 Current portion of long-term debt 749,684 — 
 Federal, state and foreign income taxes payable 81,523 24,700 
 Total current liabilities 10,803,668 7,150,247 
 Other long-term liabilities 1,063,902 851,116 
 Non-current deferred income taxes, net 37,164 142,170 
 Long-term operating lease liabilities 7,743,216 7,816,633 
 Long-term debt 5,332,921 2,236,625 
 Commitments and contingencies (See Note O) 
 SHAREHOLDERS’ EQUITY 
 Preferred stock, authorized 5,000,000 shares, par value $ 1 , no shares issued 
 — — 
 Common stock, authorized 1,800,000,000 shares, par value $ 1 , issued and outstanding 1,204,698,124 and 1,199,099,768 , respectively 
 1,204,698 1,199,100 
 Additional paid-in capital 260,515 — 
 Accumulated other comprehensive (loss) income ( 606,071 ) ( 673,171 ) 
 Retained earnings 4,973,542 5,422,283 
 Total shareholders’ equity 5,832,684 5,948,212 
 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 30,813,555 $ 24,145,003 

 The accompanying notes are an integral part of the financial statements. 
 F-6 

 
 
 

 THE TJX COMPANIES, INC. 
 CONSOLIDATED STATEMENTS OF CASH FLOWS 
 IN THOUSANDS 
 
 Fiscal Year Ended 
 January 30,
2021 February 1,
2020 February 2,
2019 
 
 Cash flows from operating activities: 
 Net income $ 90,470 $ 3,272,193 $ 3,059,798 
 Adjustments to reconcile net income to net cash provided by operating activities: 
 Depreciation and amortization 870,758 867,303 819,655 
 Loss on early extinguishment of debt 312,233 — — 
 Loss on property disposals and impairment charges 83,794 16,054 17,653 
 Deferred income tax (benefit) ( 230,690 ) ( 6,233 ) ( 88,594 ) 
 Share-based compensation 58,519 124,957 103,557 
 
 Pension settlement charge — — 36,122 
 
 Changes in assets and liabilities: 
 (Increase) in accounts receivable ( 71,091 ) ( 42,998 ) ( 23,532 ) 
 Decrease (increase) in merchandise inventories 588,756 ( 296,541 ) ( 465,429 ) 
 Decrease (increase) in income taxes recoverable 10,707 ( 34,177 ) 15,452 
 (Increase) decrease in prepaid expenses and other current assets ( 57,450 ) ( 17,084 ) 220,890 
 Increase in accounts payable 2,111,189 29,338 198,212 
 Increase in accrued expenses and other liabilities 584,502 345,745 169,418 
 Increase (decrease) in income taxes payable 52,791 ( 128,342 ) 40,965 
 Increase in net operating lease liabilities 200,243 29,617 — 
 Other, net ( 42,842 ) ( 93,292 ) ( 15,708 ) 
 Net cash provided by operating activities 4,561,889 4,066,540 4,088,459 
 Cash flows from investing activities: 
 Property additions ( 568,021 ) ( 1,223,116 ) ( 1,125,139 ) 
 Investment in Familia — ( 230,156 ) — 
 Purchases of investments ( 29,100 ) ( 28,838 ) ( 161,625 ) 
 Sales and maturities of investments 18,524 12,720 636,560 
 Other — 7,419 26,652 
 Net cash (used in) investing activities ( 578,597 ) ( 1,461,971 ) ( 623,552 ) 
 Cash flows from financing activities: 
 Payments on revolving credit facilities ( 1,000,000 ) — — 
 Proceeds from long-term debt including revolving credit facilities 5,986,873 — — 
 Payments of long-term debt and extinguishment expenses ( 1,418,358 ) — — 
 Payments for debt issuance expenses ( 42,377 ) — — 
 Payments for repurchase of common stock ( 201,500 ) ( 1,551,992 ) ( 2,406,997 ) 
 Proceeds from issuance of common stock 211,189 232,106 255,241 
 Payments of employee tax withholdings for performance based stock awards ( 29,309 ) ( 23,423 ) ( 16,014 ) 
 Cash dividends paid ( 278,256 ) ( 1,071,562 ) ( 922,596 ) 
 Other — — ( 7,115 ) 
 Net cash provided by (used in) financing activities 3,228,262 ( 2,414,871 ) ( 3,097,481 ) 
 Effect of exchange rate changes on cash 41,264 ( 3,175 ) ( 95,674 ) 
 Net increase in cash and cash equivalents 7,252,818 186,523 271,752 
 Cash and cash equivalents at beginning of year 3,216,752 3,030,229 2,758,477 
 Cash and cash equivalents at end of year $ 10,469,570 $ 3,216,752 $ 3,030,229 

 The accompanying notes are an integral part of the financial statements. 
 F-7 

 
 
 

 THE TJX COMPANIES, INC. 
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY 
 IN THOUSANDS 
 
 
 Common Stock Additional
Paid-In
Capital Accumulated
Other
Comprehensive(Loss) Income Retained
Earnings Total 
 Shares Par Value 
 $ 1 
 
 Balance, February 3, 2018 
 1,256,018 $ 1,256,018 $ — $ ( 441,859 ) $ 4,334,150 $ 5,148,309 
 Net income — — — — 3,059,798 3,059,798 
 Cumulative effect of accounting change — — — — 58,712 58,712 
 Other comprehensive (loss), net of tax — — — ( 188,462 ) — ( 188,462 ) 
 Cash dividends declared on common stock — — — — ( 965,539 ) ( 965,539 ) 
 Recognition of share-based compensation — — 103,557 — — 103,557 
 Issuance of common stock under stock incentive plan and related tax effect 11,988 11,988 227,240 — — 239,228 
 Common stock repurchased ( 50,823 ) ( 50,823 ) ( 330,797 ) — ( 2,025,377 ) ( 2,406,997 ) 
 Balance, February 2, 2019 
 1,217,183 1,217,183 — ( 630,321 ) 4,461,744 5,048,606 
 Net income — — — — 3,272,193 3,272,193 
 Cumulative effect of accounting change — — — — 403 403 
 Other comprehensive (loss), net of tax — — — ( 42,850 ) — ( 42,850 ) 
 Cash dividends declared on common stock — — — — ( 1,111,788 ) ( 1,111,788 ) 
 Recognition of share-based compensation — — 124,957 — — 124,957 
 Issuance of common stock under stock incentive plan and related tax effect 10,067 10,067 198,616 — — 208,683 
 Common stock repurchased ( 28,150 ) ( 28,150 ) ( 323,573 ) — ( 1,200,269 ) ( 1,551,992 ) 
 Balance, February 1, 2020 
 1,199,100 1,199,100 — ( 673,171 ) 5,422,283 5,948,212 
 Net income — — — — 90,470 90,470 
 
 Other comprehensive income, net of tax — — — 67,100 — 67,100 
 Cash dividends declared on common stock — — — — ( 311,970 ) ( 311,970 ) 
 Recognition (reversal) of share-based compensation — — 112,923 — ( 54,404 ) 58,519 
 Issuance of common stock under stock incentive plan and related tax effect 8,985 8,985 173,307 — ( 439 ) 181,853 
 Common stock repurchased ( 3,387 ) ( 3,387 ) ( 25,715 ) — ( 172,398 ) ( 201,500 ) 
 Balance, January 30, 2021 
 1,204,698 $ 1,204,698 $ 260,515 $ ( 606,071 ) $ 4,973,542 $ 5,832,684 

 The accompanying notes are an integral part of the financial statements. 
 F-8 

 
 
 

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
 
 Note A. Basis of Presentation and Summary of Accounting Policies 
 Basis of Presentation 
 The Consolidated Financial Statements and Notes thereto of The TJX Companies, Inc. (referred to as “TJX,” “we” or “the Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the financial statements of all of TJX’s subsidiaries, all of which are wholly owned. All of the Company's activities are conducted by TJX or its subsidiaries and are consolidated in these financial statements. All intercompany transactions have been eliminated in consolidation. Investments for which the Company exercises significant influence but does not have control are accounted for under the equity method. 
 TJX is impacted by the uncertainty surrounding the financial impact of the novel coronavirus (“COVID-19”) pandemic as discussed in Note B—Impact of the COVID-19 Pandemic. 
 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, 2021 (“fiscal 2021”), February 1, 2020 (“fiscal 2020”) and February 2, 2019 ("fiscal 2019") were 52-week fiscal years. 
 Use of Estimates 
 The preparation of financial statements, in conformity with 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 leases, inventory valuation, impairment of long-lived assets, reserves for uncertain tax positions and loss contingencies to be the most significant accounting policies that involve management estimates and judgments. The Company considered COVID-19 related impacts to its estimates, as appropriate, within its consolidated financial statements and there may be changes to those estimates in future periods. The Company believes that its accounting estimates are appropriate after giving consideration to the ongoing uncertainties surrounding the severity and duration of the COVID-19 pandemic and the associated containment and remediation efforts. Actual amounts could differ from these estimates, and such differences could be material. 
 Reclassifications 
 Certain reclassifications have been made to prior year financial information to conform to the current year presentation. 
 Summary of Accounting Policies 
 Revenue Recognition 
 Net Sales 
 Net sales consist primarily of merchandise sales, which are recorded net of a reserve for estimated returns, any discounts and sales taxes, for the sales of merchandise both within our stores and online. Net sales also include an immaterial amount of other revenues that represent less than 1 % of total revenues, primarily generated from shipping fee revenue on our online sales. In addition, certain customers may receive discounts that are accounted for as consideration reducing the transaction price. Merchandise sales from our stores are recognized at the point of sale when TJX provides the merchandise to the customer. The performance obligation is fulfilled at this point when the customer has obtained control by paying for and leaving with the merchandise. Merchandise sales made online are recognized when the product has been shipped, which is when legal title has passed and when TJX is entitled to payment, and the customer has obtained the ability to direct the use of and obtain substantially all of the remaining benefits from the goods. Shipping and handling activities related to online sales occur after the customer obtains control of the goods. TJX’s policy is to treat shipping costs as part of our fulfillment center costs within our operating expenditures. As a result, shipping fee revenues received is recognized when control of the goods transfer to the customer and is recorded as net sales. Shipping and handling costs incurred by TJX are included in cost of sales, including buying and occupancy costs. TJX disaggregates revenue by operating segment, see Note H—Segment Information. 
 Deferred Gift Card Revenue 
 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, as TJX does not fulfill its performance obligation until the gift card has been redeemed. While gift cards have an indefinite life, substantially all are redeemed in the first year of issuance. 
 F-9 

 
 

 The following table presents deferred gift card revenue activity: 
 
 In thousands January 30,
2021 February 1,
2020 
 Balance, beginning of year $ 500,844 $ 450,302 
 Deferred revenue 1,159,242 1,690,073 
 Effect of exchange rates changes on deferred revenue 3,758 258 
 Revenue recognized ( 1,087,657 ) ( 1,639,789 ) 
 Balance, end of year $ 576,187 $ 500,844 

 TJX recognized $ 1.1 billion in gift card revenue in fiscal 2021 and $ 1.6 billion in each of fiscal 2020 and fiscal 2019. The decrease in fiscal 2021 in both deferred revenue and revenue recognized versus the prior year reflects the impact of lower customer traffic and temporary store and e-commerce closures due to the COVID-19 pandemic. Gift cards are combined in one homogeneous pool and are not separately identifiable. As such, the revenue recognized consists of gift cards that were part of the deferred revenue balance at the beginning of the period as well as gift cards that were issued during the period. Based on historical experience, the Company estimates 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 estimated redemption period. Revenue recognized from breakage was $ 14 million in fiscal 2021, $ 20 million in fiscal 2020 and $ 21 million in fiscal 2019. 
 Sales Return Reserve 
 The Company's products are generally sold with a right of return and the Company may provide other credits or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize. The Company has elected to apply the portfolio practical expedient. The Company estimates the variable consideration using the expected value method when calculating the returns reserve because the difference in applying it to the individual contract would not differ materially. Returns are estimated based on historical experience and are required to be established and presented at the gross sales value with an asset established for the estimated value of the merchandise returned separate from the refund liability. Liabilities for return allowances are included in “Accrued expenses and other current liabilities” and the estimated value of the merchandise to be returned is included in “Prepaid expenses and other current assets” on our Consolidated Balance Sheets. 
 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; asset retirement obligation costs; divisional 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. If applicable, 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, 2021, TJX’s cash and cash equivalents held outside the U.S. were $ 1.2 billion, of which $ 0.8 billion was held in countries where TJX has the intention to reinvest any undistributed earnings indefinitely. 
 F-10 

 
 

 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 T.K. Maxx in Australia which is immaterial. The businesses that utilize the retail method have some inventory that is initially valued at cost before the retail method is applied as that inventory 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 records inventory at the time title transfers, which is typically at the time when inventory is shipped. As a result, merchandise inventories on TJX’s Consolidated Balance Sheets include in-transit inventory of $ 1.2 billion at January 30, 2021 and $ 0.8 billion at February 1, 2020. 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 volume of share repurchases under previous programs, TJX has historically had no remaining balance in APIC. 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 excess tax benefits or deficiencies are included in the provision for income taxes. The par value of performance share units and restricted stock units is added to common stock when shares are delivered following performance measurement date or service period to the extent vesting requirements have been achieved. The fair value of stock awards and units are 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 stock awards. Performance-based awards are evaluated quarterly for probability of vesting and performance achievement levels. See Note I—Stock Incentive Plan 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 interest expense, net: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 
 
 Interest expense $ 199,038 $ 61,400 $ 69,102 
 Capitalized interest ( 5,384 ) ( 2,314 ) ( 4,263 ) 
 Interest (income) ( 12,920 ) ( 49,060 ) ( 55,979 ) 
 Interest expense, net $ 180,734 $ 10,026 $ 8,860 

 
 TJX capitalizes interest during the active construction period of major capital projects and adds the interest to the related assets. 
 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 to 15 years), whichever is shorter. Furniture, fixtures and equipment are depreciated over 3 to 10 years. Depreciation and amortization expense for property was $ 858 million in fiscal 2021, $ 858 million in fiscal 2020 and $ 819 million in fiscal 2019. TJX had no property held under finance leases during fiscal 2021 and fiscal 2020 or under capital leases during fiscal 2019. Maintenance and repairs are charged to expense as incurred. Significant costs incurred for internally developed software are capitalized and amortized, generally over 5 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. 
 F-11 

 
 

 Lease Accounting 
 The Company adopted ASU No. 2016-02, Leases (Topic 842), as of February 3, 2019, using the modified retrospective method under ASU 2018-11. The Company elected the transition package of three practical expedients, which among other things, allowed it to carry forward the historical lease classification. The Company has elected the practical expedient to not separate non-lease components from the lease components to which they relate and instead to combine them and account for them as a single lease component. The Company also elected the accounting policy election to keep leases with a term of twelve months or less off the Consolidated Balance Sheets and recognizes these lease payments on a straight-line basis over the lease term. 
 Operating leases are included in “Operating lease right of use assets”, “Current portion of operating lease liabilities”, and “Long-term operating lease liabilities” on our Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. At the inception of the arrangement, the Company determines if an arrangement is a lease based on assessment of the terms and conditions of the contract. Operating lease ROU assets and lease liabilities are recognized at possession date based on the present value of lease payments over the lease term. The majority of our leases are retail store locations and the possession date 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. Our lessors do not provide an implicit rate, nor is one readily available, therefore the Company uses its incremental borrowing rate based on the information available at possession date in determining the present value of future lease payments. The incremental borrowing rate is calculated based on the US Consumer Discretionary yield curve and adjusted for collateralization and foreign currency impact for TJX International and Canada leases. The operating lease ROU assets also include any acquisition costs offset by lease incentives. The Company’s lease terms include options to extend the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term within “Cost of sales, including buying and occupancy costs”. See Note M—Leases for a detailed discussion of lease accounting. 
 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, and the purchase of Sierra Trading Post in fiscal 2013, which was rebranded as Sierra in fiscal 2019, both which are included in Marmaxx. The Company fully impaired the Sierra goodwill, recording an impairment charge of $ 97 million in fiscal 2018. The Company’s goodwill also includes, 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, included in TJX Canada, as well as the purchase of Trade Secret in fiscal 2016, which was re-branded under the T.K. Maxx name during fiscal 2018 and is included in TJX International. The following is a roll forward of goodwill by segment: 
 
 In thousands Marmaxx TJX Canada TJX International Total 
 Balance, February 2, 2019 $ 70,027 $ 1,692 $ 25,833 $ 97,552 
 
 Effect of exchange rate changes on goodwill — ( 17 ) ( 1,989 ) ( 2,006 ) 
 Balance, February 1, 2020 $ 70,027 $ 1,675 $ 23,844 $ 95,546 
 Effect of exchange rate changes on goodwill — 61 3,391 3,452 
 Balance, January 30, 2021 $ 70,027 $ 1,736 $ 27,235 $ 98,998 

 
 Goodwill is considered to have an indefinite life and accordingly is not amortized. 
 Tradenames, which are included in other assets, 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 considered to have an indefinite life and accordingly is not amortized. The Sierra Trading Post tradename is being amortized over 15 years. During the first quarter of fiscal 2021, the Company fully impaired the Trade Secret tradename, recording an impairment charge of $ 5 million. 
 F-12 

 
 

 The following is a roll forward of tradenames: 
 
 Fiscal Year Ended 
 January 30, 2021 February 1, 2020 
 In thousands Gross Carrying Amount Accumulated Amortization Impact of FX Net Carrying Value Gross Carrying Amount Accumulated Amortization Impact of FX Net Carrying Value 
 Definite-lived intangible assets: 
 Sierra Trading Post $ 38,500 $ ( 20,747 ) $ — $ 17,753 $ 38,500 $ ( 18,181 ) $ — $ 20,319 
 Trade Secret $ 12,541 $ ( 10,247 ) $ ( 2,294 ) $ — $ 12,541 $ ( 5,242 ) $ ( 1,948 ) $ 5,351 
 Indefinite-lived intangible asset: 
 Marshalls $ 107,695 $ — $ — $ 107,695 $ 107,695 $ — $ — $ 107,695 

 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 or impairment if any, are included in the respective operating segment to which they relate. 
 Impairment of Long-Lived Assets, Goodwill and Tradenames 
 TJX evaluates long-lived assets, including tradenames that are amortized and operating lease right of use assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. This evaluation is performed at the lowest level of identifiable cash flows which are largely independent of other groups of assets, generally at the individual store level for fixed assets and operating lease right of use assets, and at the reporting unit for tradenames that are amortized. If indicators of impairment are identified, an undiscounted cash flow analysis is performed to determine if the carrying value of the asset or asset group is recoverable. If the cash flow is less than the carrying value then an impairment charge will be recorded to the extent the fair value of an asset or asset group is less than the carrying value of that asset or asset group. This resulted in immaterial impairment charges on operating lease right of use assets and store fixed assets in fiscal 2021 and fiscal 2020, and immaterial impairment charges on store fixed assets in fiscal 2019. In fiscal 2021, the Company fully impaired the Trade Secret tradename. There were no impairments related to tradenames in fiscal 2020 or 2019. 
 Goodwill and indefinite life tradenames are 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. Goodwill is tested for impairment by 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. The Company 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. Indefinite life tradenames are tested for impairment by comparing their carrying value to their fair value, which is determined by calculating the discounted present value of assumed after-tax royalty payments. In fiscal 2021, fiscal 2020 and fiscal 2019, the Company bypassed the qualitative assessment and performed the quantitative impairment test. There were no impairments related to the Company’s goodwill or indefinite life tradenames in fiscal 2021, 2020, or 2019. 
 Advertising Costs 
 TJX expenses advertising costs as incurred. Advertising expense was $ 296 million for fiscal 2021, $ 452 million for fiscal 2020 and $ 446 million for fiscal 2019. 
 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 (loss) income. Activity of the foreign operations that affect the Consolidated Statements of Income and Cash Flows is translated at average exchange rates prevailing during the fiscal year. 
 F-13 

 
 

 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. 
 Equity Investment 
 In fiscal 2020, the Company acquired a 25 % ownership stake in privately held Familia, an established, off-price apparel and home fashions retailer operating stores throughout Russia. The Company accounts for its equity investment in Familia using the equity method of accounting, with the investment recorded in Other assets on our Consolidated Balance Sheets, and the Company’s share of Familia’s results recorded in Selling, general and administrative expenses in our Consolidated Statements of Income. Due to the timing and availability of financial information of Familia, the Company accounts for this equity method investment on a one-quarter lag. 
 As of fiscal 2021 and fiscal 2020, the carrying value of the Company’s equity investment in Familia was $ 196 million and $ 230 million, respectively, which exceeded its share of Familia’s net assets by approximately $ 186 million and $ 212 million, respectively. Substantially all of this difference is comprised of goodwill. Revaluing the investment from Russian rubles to the U.S. dollar as of January 30, 2021 resulted in a cumulative translation loss and reduced the carrying value of our investment by $ 35 million. The cumulative translation loss has been recorded in our Consolidated Balance Sheets as a component of Accumulated other comprehensive loss. Other indefinite-lived intangible assets consisting of tradename and customer relationships are amortized straight line over their useful lives of 10 years for the tradename and 7 years for customer relationship. 
 This investment is evaluated for indicators of impairment on a periodic basis or whenever events or circumstances indicate the carrying amount may be other-than-temporarily impaired. If the Company concludes that there is an other-than-temporary impairment of this equity investment, it will adjust the carrying amount of the investment to the current fair value. As of fiscal year ended 2021 and 2020, the Company determined that no impairment of its equity method investment existed. 
 Future Adoption of New Accounting Standards 
 From time to time, the Financial Accounting Standards Board (“FASB”) or other standard setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification are communicated through issuance of an Accounting Standards Update (“ASU”). Unless otherwise discussed, the Company has reviewed the guidance and have determined that they will not apply or are not expected to be material to our Consolidated Financial Statements upon adoption and therefore, are not disclosed. 
 Recently Adopted Accounting Standards 
 Simplified Accounting for Income Taxes 
 In December 2019, the FASB issued guidance related to simplified accounting for income taxes. The new standard simplifies accounting for income taxes by removing certain exceptions to the general principals in Topic 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. It also clarifies and simplifies other aspects of the accounting for income taxes. This standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2020, with early adoption permitted in any interim period within that year. The Company reviewed the provisions of this standard and determined that most of them do not apply to TJX. The most significant impact to the Company is the simplification of the tax benefit calculation recognized on pre-tax losses in interim periods. The Company elected to early adopt this standard as of February 2, 2020, which did not have an impact on the Company's Consolidated Financial Statements or disclosures for fiscal 2021. 
 F-14 

 
 
 

 Note B. Impact of the COVID-19 Pandemic 
 After a novel coronavirus disease (“COVID-19”) emerged and spread worldwide, the World Health Organization declared COVID-19 a pandemic in March 2020, and national, state and local governments and private entities began issuing various restrictions, including travel restrictions, restrictions on public gatherings, stay at home orders and advisories and quarantine or isolation protocols. The Company temporarily closed all of its stores, its online businesses, its distribution centers and its offices in March 2020, with Associates working remotely where possible. During April 2020, the Company temporarily furloughed the majority of the hourly store and distribution center Associates in the U.S. and Canada, with employee benefits coverage for eligible Associates continuing during the temporary furlough at no cost to impacted Associates. The Company also took comparable actions with respect to portions of our European and Australian workforces. 
 When the Company began to reopen stores and distribution centers in May 2020, it implemented new health and safety practices, including practices related to personal protective equipment and social distancing protocols. Early in the fourth quarter of fiscal 2021, in response to increasing cases of COVID-19, hundreds of stores had additional temporary closures, primarily in Europe and Canada. As of March 30, 2021, the Company has approximately 580 stores, primarily in Europe, that are temporarily closed due to government mandates in response to the COVID-19 global pandemic. All of the Company’s e-commerce businesses remain open, including tkmaxx.com in the U.K. 
 In fiscal 2021, the Company amended the credit agreements governing its revolving credit facilities and as a result, the Company expects to maintain compliance with its covenants for at least one year from the issuance of these consolidated financial statements. As the COVID-19 pandemic is complex and rapidly evolving, and cases have been rising around the world, the Company cannot reasonably estimate the duration and severity of this pandemic, which has had and may continue to have a material impact on its business, results of operations, financial position and cash flows. 
 Financial Actions 
 Balance Sheet, Cash Flow and Liquidity 
 During fiscal 2021 the Company generated $ 4.6 billion of operating cash flows and ended the year with $ 10.5 billion of cash. In addition, the Company increased its borrowing capacity by entering into a $ 500 million 364 Day Revolving Credit Facility (as defined in Note K—Long-Term Debt and Credit Lines), making a total of $ 1.5 billion available to the Company under revolving credit facilities. In the first quarter of fiscal 2021, TJX issued $ 4 billion aggregate principal amount of notes. During the fourth quarter of fiscal 2021, the Company issued $ 1 billion in notes and accepted $ 1.12 billion in combined aggregate principal amount of certain of its notes issued in the first quarter of fiscal 2021 pursuant to cash tender offers. The Company paid $ 1.42 billion aggregate consideration (including transaction costs) and recorded a $ 0.3 billion pre-tax loss on the early extinguishment for the accepted notes. For additional information on the new credit facility and debt transactions, see Note K—Long-Term Debt and Credit Lines. The Company's Board of Directors suspended its share buyback program and did not declare a dividend in the first nine months of fiscal 2021. The Board of Directors declared a dividend of $ 0.26 per share in the fourth quarter of fiscal 2021, paid in March 2021. 
 During fiscal 2021, the Company negotiated rent deferrals (primarily for second quarter lease payments) for a significant number of its stores, with repayment at later dates, primarily in fiscal 2022. Consistent with updated guidance from the FASB in April 2020, the Company elected to treat the COVID-19 pandemic-related rent deferrals as a resolution of a contingency by remeasuring the lease liability, with a corresponding offset to the right-of-use asset, using the remeasured consideration. In addition to negotiating deferral of lease payments, the Company also temporarily extended payment terms on merchandise orders, which increased our accounts payable as of the end of the fiscal year, benefiting operating cash flows. As payment terms are reduced and we make deferred payments, the Company expects our operating cash flows to be negatively impacted. 
 The Company evaluated the value of its inventory in light of the temporary store closures in the first and fourth quarters of fiscal 2021 due to the COVID-19 pandemic. Permanent markdowns, which had been or will be taken upon reopening of the stores, on transitional or out of season merchandise and merchandise that was already in markdown status, combined with the write-off of perishable goods, resulted in a reduction of inventory for fiscal 2021. Additional markdowns recorded throughout the year were taken in the ordinary course of business operations. 
 Given the substantial reduction in the Company’s sales and the reduced cash flow projections as a result of the temporary store closures during fiscal 2021 due to the COVID-19 pandemic, the Company determined that triggering events had occurred and that impairment assessments were warranted for certain stores. This resulted in immaterial impairment charges for fiscal 2021 , related to operating lease right of use assets and store fixed assets. 
 F-15 

 
 

 In response to the COVI D-19 pandemic, governments in the U.S., United Kingdom ( “ U.K. ” ), Canada and various other jurisdictions have implemented programs to encourage companies to retain and pay employees who are unable to work or are limited in the work that they can perform in light of closures or a significant decline in sales. Throughout fiscal 2021, the Company continued to qualify for certain of these provisions, which partially offset related expenses. During fiscal 2021, these programs reduced the Company’s expenses by approximately $ 0.5 billion o n its Consolidated Statements of Income, and increased Accounts receivable, net on its Consolidated Balance Sheets by approxim ately $ 0.1 billion. These government programs also provide for the option to defer payroll tax and VAT payments, which has resulted in a combined increase in Accrued expenses and other current liabilities and Other long-term liabilities o n our Consolidated Balance Sheets b y approximately $ 0.3 billion. 
 The Company also incurred incremental costs associated with the COVID-19 pandemic, including primarily from: 
 – Incremental payroll costs associated with monitoring occupancy limits to comply with social distancing protocols and implementing enhanced cleaning regimens. 
 – Incremental expense related to the discre tionary appreciation bonus for store and distribution center Associates. 
 – Incremental cleaning supplies and personal protective equipment for our Associates. 
 
 Note C. Property at Cost 
 Presented below are the components of property at cost: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 
 Land and buildings 
 $ 1,668,381 $ 1,505,039 
 Leasehold costs and improvements 
 3,568,829 3,481,313 
 Furniture, fixtures and equipment 
 6,525,615 6,385,926 
 Total property at cost $ 11,762,825 $ 11,372,278 
 Less accumulated depreciation and amortization 6,726,729 6,047,230 
 Net property at cost $ 5,036,096 $ 5,325,048 

 Presented below is information related to carrying values of TJX’s long-lived tangible assets by geographic location: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 
 United States $ 3,844,711 $ 4,054,833 
 Canada 241,086 259,977 
 Europe 898,518 965,751 
 Australia 51,781 44,487 
 Total long-lived tangible assets $ 5,036,096 $ 5,325,048 

 
 
 F-16 

 
 
 

 Note D. Accumulated Other Comprehensive (Loss) Income 
 Amounts included in Accumulated other comprehensive (loss) income relate to the Company’s foreign currency translation adjustments, gains/losses on net investment derivatives, deferred gains/losses on pension and other post-retirement obligations and a 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 (loss) income for fiscal 2021, fiscal 2020 and fiscal 2019: 
 
 In thousands Foreign
Currency
Translation Deferred
Benefit Costs Cash Flow
Hedge on Debt Accumulated
Other
Comprehensive(Loss) Income 
 Balance, February 3, 2018 $ ( 280,051 ) $ ( 159,562 ) $ ( 2,246 ) $ ( 441,859 ) 
 Additions to other comprehensive loss: 
 Foreign currency translation adjustments (net of taxes of $ 8,233 ) 
 ( 192,664 ) — — ( 192,664 ) 
 Recognition of net gains/losses on investment hedges (net of taxes of $ 7,113 ) 
 19,538 — — 19,538 
 Recognition of net gains/losses on benefit obligations (net of taxes of $ 19,813 ) 
 — ( 54,420 ) — ( 54,420 ) 
 Reclassifications from other comprehensive loss to net income: 
 Pension settlement charge (net of taxes of $ 9,641 ) 
 — 26,481 — 26,481 
 Amortization of loss on cash flow hedge (net of taxes of $ 304 
 — — 847 847 
 Amortization of prior service cost and deferred gains/losses (net of taxes of $ 4,280 ) 
 — 11,756 — 11,756 
 Balance, February 2, 2019 $ ( 453,177 ) $ ( 175,745 ) $ ( 1,399 ) $ ( 630,321 ) 
 Additions to other comprehensive loss: 
 Foreign currency translation adjustments (net of taxes of $ 1,189 ) 
 ( 3,943 ) — — ( 3,943 ) 
 
 Recognition of net gains/losses on benefit obligations (net of taxes of $ 20,489 ) 
 — ( 56,275 ) — ( 56,275 ) 
 
 Reclassifications from other comprehensive loss to net income: 
 Amortization of loss on cash flow hedge (net of taxes of $ 303 ) 
 — — 831 831 
 Amortization of prior service cost and deferred gains/losses (net of taxes of $ 6,019 ) 
 — 16,537 — 16,537 
 Balance, February 1, 2020 $ ( 457,120 ) $ ( 215,483 ) $ ( 568 ) $ ( 673,171 ) 
 Additions to other comprehensive loss: 
 Foreign currency translation adjustments (net of taxes of $ 2,442 ) 
 15,588 — — 15,588 
 Recognition of net gains/losses on benefit obligations (net of taxes of $ 9,974 ) 
 — 30,635 — 30,635 
 Reclassifications from other comprehensive loss to net income: 
 Amortization of loss on cash flow hedge (net of taxes of $ 303 ) 
 — — 831 831 
 Amortization of prior service cost and deferred gains/losses (net of taxes of $ 7,298 ) 
 — 20,046 — 20,046 
 Balance, January 30, 2021 $ ( 441,532 ) $ ( 164,802 ) $ 263 $ ( 606,071 ) 

 
 
 
 F-17 

 
 
 

 Note E. Capital Stock and Earnings Per Share 
 Capital Stock 
 In March 2020, in connection with the actions taken related to the COVID-19 pandemic as described in Note B—Impact of the COVID-19 Pandemic, the Company suspended its share repurchase program. 
 During the first quarter of fiscal 2021, prior to the suspension of the Company’s share repurchase program, TJX repurchased and retired 3.2 million shares of its common stock at a cost of $ 190.1 million on a “trade date” basis. All share repurchases occurred during the first quarter of fiscal 2021. TJX reflects stock repurchases in its financial statements on a “settlement date” or cash basis. TJX had cash expenditures under repurchase programs of $ 201.5 million in fiscal 2021, $ 1.6 billion in fiscal 2020 and $ 2.4 billion in fiscal 2019 and repurchased 3.4 million shares in fiscal 2021, 28.2 million shares in fiscal 2020 and 50.8 million shares in fiscal 2019. These expenditures were funded by cash generated from operations. 
 As of January 30, 2021 TJX had approximately $ 3.0 billion available under previously announced stock repurchase programs. 
 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. 
 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,
2021 February 1,
2020 February 2,
2019 
 
 Basic earnings per share: 
 Net income $ 90,470 $ 3,272,193 $ 3,059,798 
 Weighted average common stock outstanding for basic earnings per share calculation 1,199,927 1,208,163 1,241,153 
 Basic earnings per share $ 0.08 $ 2.71 $ 2.47 
 Diluted earnings per share: 
 Net income $ 90,470 $ 3,272,193 $ 3,059,798 
 Weighted average common stock outstanding for basic earnings per share calculation 1,199,927 1,208,163 1,241,153 
 Assumed exercise / vesting of: 
 Stock options and awards 14,776 18,356 18,099 
 Weighted average common stock outstanding for diluted earnings per share calculation 1,214,703 1,226,519 1,259,252 
 Diluted earnings per share $ 0.07 $ 2.67 $ 2.43 
 Cash dividends declared per share (a) 
 $ 0.26 $ 0.92 $ 0.78 

 (a) There were no dividends declared during the first three quarters of fiscal 2021. The Company declared a dividend of $ 0.26 per share in the fourth quarter of fiscal 2021. 
 The weighted average common shares for the diluted earnings per share calculation exclude 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 6.2 million, 11.8 million and 6.1 million such options excluded at the end of fiscal 2021, fiscal 2020 and fiscal 2019, respectively. 
 
 
 F-18 

 
 
 

 Note F. Financial Instruments 
 As a result of its operating and financing activities, TJX is exposed to market risks from changes in interest and foreign currency exchange rates and fuel costs. These market risks may adversely affect TJX’s operating results and financial position. TJX seeks to minimize risk from changes in interest and foreign currency exchange rates and fuel costs through the use of derivative financial instruments when and to the extent deemed appropriate. 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. 
 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 based on the price of diesel fuel. 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 2021, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2022. The hedge agreements outstanding at January 30, 2021 relate to approximately 42 % of TJX’s estimated notional diesel requirements for fiscal 2022. These diesel fuel hedge agreements will settle throughout fiscal 2022 and the first month of fiscal 2023. TJX elected not to apply hedge accounting rules to these contracts. 
 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 currencies other than their respective functional currencies, primarily in TJX International and TJX Canada. These contracts typically have a term of twelve months or less. The contracts outstanding at January 30, 2021 cover a portion of such actual and anticipated merchandise purchases throughout fiscal 2022. Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the U.K. 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 may sometimes generate Euros in excess of those needed to meet merchandise commitments to outside vendors. TJX calculates this excess Euro exposure each month and enters into forward contracts of approximately 30 days duration 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. 
 TJX periodically reviews its net investments in foreign subsidiaries. During the fiscal quarter ended May 5, 2018, TJX entered into net investment hedge contracts related to a portion of its investment in TJX Canada. During the fiscal quarter ended August 4, 2018, TJX de-designated the net investment hedge contracts. The remaining life of the foreign currency contracts provided a natural hedge to the declared cash dividend from TJX Canada. The contracts settled during the second quarter of fiscal 2019 resulting in a pre-tax gain of $ 27 million while designated as a net investment hedge and subsequent to de-designation, a pre-tax gain of $ 19 million. The $ 27 million gain is reflected in shareholders equity as a component of other comprehensive income. The $ 19 million gain subsequent to de-designation is reflected in the income statement offsetting a foreign currency loss of $ 18 million on the declared dividends. 
 
 
 F-19 

 
 

 The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at January 30, 2021: 
 
 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, 2021 
 
 Fair value hedges: 
 Intercompany balances, primarily debt and related interest: 
 zł 45,000 £ 8,846 0.1966 Prepaid Exp $ 11 $ — $ 11 
 A$ 80,000 U.S.$ 62,032 0.7754 Prepaid Exp 738 — 738 
 U.S.$ 75,102 £ 55,000 0.7323 Prepaid Exp 357 — 357 
 £ 200,000 U.S.$ 274,853 1.3743 Prepaid Exp 32 — 32 
 € 200,000 U.S.$ 244,699 1.2235 Prepaid Exp / (Accrued Exp) 427 ( 182 ) 245 
 Economic hedges for which hedge accounting was not elected: 
 Diesel contracts Diesel fuel contracts Fixed on 
 1.5 M - 3.8 M 
 gal per month 
 Float on 
 1.5 M - 3.8 M 
 gal per month 
 N/A Prepaid Exp 4,880 — 4,880 
 
 
 Merchandise purchase commitments: 
 C$ 384,679 U.S.$ 296,000 0.7695 Prepaid Exp / (Accrued Exp) 430 ( 5,627 ) ( 5,197 ) 
 C$ 5,391 € 3,500 0.6492 Prepaid Exp 24 — 24 
 £ 203,264 U.S.$ 263,950 1.2986 (Accrued Exp) — ( 15,086 ) ( 15,086 ) 
 zł 30,000 £ 5,865 0.1955 (Accrued Exp) — ( 29 ) ( 29 ) 
 A$ 46,985 U.S.$ 35,250 0.7502 Prepaid Exp / (Accrued Exp) 144 ( 837 ) ( 693 ) 
 U.S.$ 99,810 € 83,700 0.8386 Prepaid Exp / (Accrued Exp) 1,986 ( 160 ) 1,826 
 Total fair value of financial instruments $ 9,029 $ ( 21,921 ) $ ( 12,892 ) 

 F-20 

 
 

 The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at February 1, 2020: 
 
 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 
 February 1, 2020 
 
 Fair value hedges: 
 Intercompany balances, primarily debt and related interest: 
 zł 45,000 £ 8,930 0.1984 Prepaid Exp $ 270 $ — $ 270 
 
 A$ 50,000 U.S.$ 33,911 0.6782 Prepaid Exp 275 — 275 
 U.S.$ 72,475 £ 55,000 0.7589 Prepaid Exp 743 — 743 
 Economic hedges for which hedge accounting was not elected: 
 Diesel fuel contracts Fixed on 
 2.9 M - 3.5 M 
 gal per month 
 Float on 
 2.9 M - 3.5 M 
 gal per month 
 N/A (Accrued Exp) — ( 9,927 ) ( 9,927 ) 
 Intercompany billings in TJX International, primarily merchandise related: 
 € 58,700 £ 49,848 0.8492 Prepaid Exp 655 — 655 
 Merchandise purchase commitments: 
 C$ 609,340 U.S.$ 463,200 0.7602 Prepaid Exp / (Accrued Exp) 2,877 ( 207 ) 2,670 
 C$ 37,051 € 25,200 0.6801 Prepaid Exp / (Accrued Exp) 61 ( 44 ) 17 
 £ 265,653 U.S.$ 341,880 1.2869 Prepaid Exp / (Accrued Exp) 11 ( 9,792 ) ( 9,781 ) 
 zł 362,700 £ 72,217 0.1991 Prepaid Exp 1,903 — 1,903 
 A$ 29,400 U.S.$ 20,151 0.6854 Prepaid Exp 435 — 435 
 U.S.$ 49,849 € 44,635 0.8954 Prepaid Exp / (Accrued Exp) 10 ( 235 ) ( 225 ) 
 Total fair value of financial instruments $ 7,240 $ ( 20,205 ) $ ( 12,965 ) 

 
 
 F-21 

 
 

 The impact of derivative financial instruments on the Consolidated Statements of Income during fiscal 2021, fiscal 2020 and fiscal 2019 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,
2021 February 1,
2020 February 2,
2019 
 
 Fair value hedges: 
 Intercompany balances, primarily debt and related interest Selling, general and administrative expenses $ ( 59,829 ) $ 4,788 $ ( 2,674 ) 
 Economic hedges for which hedge accounting was not elected: 
 Intercompany receivable Selling, general and administrative expenses — 3,257 18,823 
 Diesel fuel contracts Cost of sales, including buying and occupancy costs ( 5,638 ) ( 9,780 ) 1,373 
 Intercompany billings in TJX International, primarily merchandise related Cost of sales, including buying and occupancy costs ( 4,249 ) 2,652 1,137 
 International lease liabilities Cost of sales, including buying and occupancy costs — ( 1,113 ) — 
 Merchandise purchase commitments Cost of sales, including buying and occupancy costs ( 4,468 ) 10,484 60,407 
 (Loss) gain recognized in income $ ( 74,184 ) $ 10,288 $ 79,066 

 Included in the table above are realized losses of $ 74 million in fiscal 2021 and realized gains of $ 20 million in fiscal 2020 and $ 74 million in fiscal 2019, all of which were largely offset by gains and losses on the underlying hedged item. 
 
 Note G. Fair Value Measurements 
 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,
2021 February 1,
2020 
 Level 1 
 Assets: 
 Executive Savings Plan investments $ 363,729 $ 305,777 
 Level 2 
 Assets: 
 Foreign currency exchange contracts $ 4,149 $ 7,240 
 Diesel fuel contracts 4,880 — 
 Liabilities: 
 Foreign currency exchange contracts $ 21,921 $ 10,278 
 Diesel fuel contracts — 9,927 

 F-22 

 
 

 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. 
 Foreign currency exchange contracts and diesel fuel contracts are valued using broker quotations, which include observable market information. TJX does not make adjustments to quotes or prices obtained from brokers or pricing services but does assess the credit risk of counterparties and will adjust final valuations when appropriate. Where independent pricing services provide fair values, TJX obtains an understanding of the methods used in pricing. As such, these instruments are classified within Level 2. 
 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, 2021 was $ 5.9 billion compared to a carrying value of $ 5.3 billion. The fair value of the current portion of long-term debt as of January 30, 2021 was $ 754 million compared to a carrying value of $ 750 million. For additional information on the new debt issuances, see Note K—Long-Term Debt and Credit Lines. The fair value of long-term debt at February 1, 2020 was $ 2.3 billion compared to a carrying value of $ 2.2 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. 
 Certain assets and liabilities are measured at fair value on a nonrecurring basis, where as the assets and liabilities are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances, such as when there is evidence of an impairment. For the years ended January 30, 2021, February 1, 2020 and February 2,
2019, the Company did not record any material impairments to long-lived assets. 
 
 Note H. Segment Information 
 TJX operates four main business segments. The Marmaxx segment (T.J. Maxx, Marshalls, tjmaxx.com and marshalls.com) and the HomeGoods segment (HomeGoods and Homesense) 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 T.K. Maxx in Australia. In addition to our four main business segments, Sierra operates sierra.com and retail stores in the U.S. The results of Sierra are included in the Marmaxx segment. 
 All of TJX’s stores, with the exception of HomeGoods and HomeSense, sell family apparel and home fashions. HomeGoods and HomeSense offer home fashions. The percentages of our consolidated revenues by major product category for the last three fiscal years are as follows: 
 
 Fiscal 2021 Fiscal 2020 Fiscal 2019 
 Apparel 
 Clothing including footwear 46 % 51 % 52 % 
 Jewelry and accessories 15 16 15 
 Home fashions 39 33 33 
 Total 100 % 100 % 100 % 

 
 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, interest expense, net and certain separately disclosed unusual or infrequent items. “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. 
 F-23 

 
 

 Presented below is financial information with respect to TJX’s business segments: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 
 Net sales: 
 In the United States: 
 Marmaxx $ 19,362,573 $ 25,664,805 $ 24,057,970 
 HomeGoods 6,096,237 6,355,770 5,787,365 
 TJX Canada 2,836,088 4,031,406 3,869,779 
 TJX International 3,842,064 5,664,996 5,257,820 
 Total net sales $ 32,136,962 $ 41,716,977 $ 38,972,934 
 Segment profit (loss): 
 In the United States: 
 Marmaxx 
 $ 891,180 $ 3,469,794 $ 3,253,949 
 HomeGoods 509,562 680,520 671,871 
 TJX Canada 124,143 515,559 551,617 
 TJX International ( 503,618 ) 307,081 285,790 
 Total segment profit $ 1,021,267 $ 4,972,954 $ 4,763,227 
 General corporate expense 439,037 556,745 545,034 
 Loss on early extinguishment of debt 312,233 — — 
 Interest expense, net 180,734 10,026 8,860 
 Pension settlement charge — — 36,122 
 Income before income taxes $ 89,263 $ 4,406,183 $ 4,173,211 

 
 
 F-24 

 
 

 Business segment information (continued): 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 
 Identifiable assets: 
 In the United States: 
 Marmaxx $ 10,220,441 $ 11,162,890 $ 6,223,110 
 HomeGoods 2,851,131 2,785,006 1,416,687 
 TJX Canada 2,035,341 1,889,679 914,789 
 TJX International 4,389,261 4,284,385 2,344,033 
 Corporate (a) 
 11,317,381 4,023,043 3,427,410 
 Total identifiable assets (b) 
 $ 30,813,555 $ 24,145,003 $ 14,326,029 
 Capital expenditures: 
 In the United States: 
 Marmaxx $ 216,186 $ 614,624 $ 598,955 
 HomeGoods 162,200 251,864 170,978 
 TJX Canada 43,879 101,862 82,333 
 TJX International 145,756 254,766 272,873 
 Total capital expenditures (c) 
 $ 568,021 $ 1,223,116 $ 1,125,139 
 Depreciation and amortization: 
 In the United States: 
 Marmaxx $ 478,963 $ 473,908 $ 456,420 
 HomeGoods 135,205 124,360 110,978 
 TJX Canada 70,777 66,693 66,365 
 TJX International 175,824 197,262 180,631 
 Corporate (d) 
 9,989 5,080 5,261 
 Total depreciation and amortization $ 870,758 $ 867,303 $ 819,655 

 (a) Corporate identifiable assets consist primarily of cash, the trust assets in connection with the Executive Savings Plan and the investment in Familia. Consolidated cash, including cash held in the Company’s foreign entities, is included with corporate assets for consistency with the reporting of cash for the Company’s segments in the U.S. The increase in Corporate identifiable assets in fiscal 2021 is primarily attributable to the increase in cash. 
 (b) On February 3, 2019, the Company adopted ASU 2016-02, Leases (Topic 842) using the modified retrospective method under ASU 2018-11, allowing it to not restate its prior period Consolidated Balance Sheets to reflect the new guidance. The adoption of the new lease standard significantly increased assets and current and long term liabilities on the Company’s Consolidated Balance Sheets as it recorded operating lease right of use assets and corresponding operating lease liabilities. For additional information, see Note M—Leases. 
 (c) Fiscal 2021 reduction in capital spending due to the COVID-19 pandemic. 
 (d) Includes debt discount accretion and debt expense amortization. 
 
 Note I. Stock Incentive Plan 
 TJX has a Stock Incentive Plan under which options and other share-based awards may be granted to its directors, officers and key employees. This plan has been approved by TJX’s shareholders, and all share-based compensation awards are made under this plan. The Stock Incentive Plan, as amended with shareholder approval, has provided for the issuance of up to 695.7 million shares with 33.9 million shares available for future grants as of January 30, 2021. TJX issues shares under the plan from authorized but unissued common stock. 
 Total compensation cost related to share-based compensation was $ 59 million, $ 125 million and $ 104 million in fiscal 2021, 2020 and 2019, respectively. As of January 30, 2021, there was $ 149 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 2 years. 
 Stock Options 
 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 3-year period starting 1 year after the grant, and have a 10-year maximum term. When options are granted with other vesting terms, the vesting information is reflected in the valuation. 
 F-25 

 
 

 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,
2021 February 1,
2020 February 2,
2019 
 Risk-free interest rate 0.28 % 1.65 % 2.88 % 
 Dividend yield (a) 
 1.4 % 1.6 % 1.4 % 
 Expected volatility factor 26.5 % 23.4 % 23.5 % 
 Expected option life 5.0 years 4.9 years 4.9 years 
 Weighted average fair value of options issued $ 11.29 $ 10.84 $ 11.85 

 (a) The reduction in the yield reflects the temporary suspension of dividends due to the COVID-19 pandemic. TJX calculated an implied dividend yield of 1.4 % by anticipating dividends to resume. The decrease in expected dividend yield reflects the suspension of dividend payments during the first nine months of fiscal 2021. 
 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. The Company uses 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. 
 A summary of the status of TJX’s stock options and related weighted average exercise prices (“WAEP”) is presented below: 
 
 Fiscal Year Ended 
 Shares in thousands January 30,
2021 February 1,
2020 February 2,
2019 
 Options WAEP Options WAEP Options WAEP 
 
 Outstanding at beginning of year 45,065 $ 36.81 49,053 $ 32.02 55,260 $ 27.52 
 Granted 6,268 57.32 6,150 56.74 6,143 53.98 
 Exercised ( 8,239 ) 25.68 ( 9,518 ) 24.40 ( 11,670 ) 21.88 
 Forfeitures ( 490 ) 52.96 ( 620 ) 46.37 ( 680 ) 38.59 
 Outstanding at end of year 42,604 $ 41.79 45,065 $ 36.81 49,053 $ 32.02 
 Options exercisable at end of year 30,659 $ 36.05 32,276 $ 31.04 34,344 $ 26.95 

 The total intrinsic value of options exercised was $ 279 million in fiscal 2021, $ 293 million in fiscal 2020 and $ 284 million in fiscal 2019. 
 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, 2021: 
 
 Shares 
 (in thousands) 
 Aggregate 
 Intrinsic 
 Value 
 (in thousands) 
 Weighted
Average
Remaining
Contract Life WAEP 
 Options outstanding expected to vest (a) 
 11,060 $ 82,510 9.0 years $ 56.58 
 Options exercisable 30,659 $ 858,015 5.0 years $ 36.05 
 Total outstanding options vested and expected to vest 41,719 $ 940,525 6.1 years $ 41.50 

 (a) Reflects 11.9 million unvested options, net of anticipated forfeitures. 
 F-26 

 
 

 Stock Awards 
 TJX grants restricted stock units and performance share units under the Stock Incentive Plan. Restricted stock units, performance share units, and previously-granted performance-based stock awards are collectively referred to as stock awards. These awards were granted without a purchase price to the recipient and are subject to vesting conditions. Vesting conditions for performance share units and performance-based stock awards include specified performance criteria, generally for a period of three fiscal years. The grant date fair value of the stock awards is charged to income over the requisite service period during which the recipient must remain employed. The fair value of the stock awards is determined at date of grant in accordance with ASC Topic 718 and, for performance share units and performance-based stock awards, assumes that performance goals will be achieved at target. Performance share units, performance-based stock awards and related compensation costs recognized are adjusted, as applicable, for performance above or below the target specified in the award. 
 During fiscal 2021, TJX determined that performance share unit awards granted during fiscal 2019 and fiscal 2020 were not expected to vest under the original performance vesting conditions. As a result, the expense previously recognized for these awards was reversed which decreased fiscal 2021 compensation expense by $ 55 million. In January 2021, for certain participants, a discretionary payout with respect to performance share unit awards granted during fiscal 2019 was approved and constituted a modification of the awards during fiscal 2021. Under ASC Topic 718 the modification requires that the fair value of these awards be adjusted to reflect the fair value on the date of the modification and resulted in a stock compensation charge of $ 16 million in fiscal 2021. 
 A summary of the status of our nonvested stock awards and changes during fiscal 2021 is presented below: 
 
 Stock Awards
(in thousands) Weighted
Average
Grant Date
Fair Value 
 Nonvested at beginning of year 3,445 $ 44.54 
 Granted 857 56.24 
 Vested ( 1,317 ) 43.25 
 Forfeited ( 14 ) 48.04 
 Modification ( 50 ) 52.17 
 Nonvested at end of year 2,921 51.36 

 There were 857,216 units with a weighted average grant date fair value of $ 56.24 , granted in fiscal 2021, 1,001,849 units, with a weighted average grant date fair value of $ 53.20 , granted in fiscal 2020, and 1,267,802 units, with a weighted average grant date fair value of $ 41.17 , granted in fiscal 2019. The fair value of awards that vested was $ 57 million in fiscal 2021, $ 38 million in fiscal 2020, and $ 30 million in fiscal 2019. 
 Other Awards 
 TJX also awards deferred shares to its outside directors under the Stock Incentive Plan. As of the end of fiscal 2021, a total of 665,477 of these deferred shares were outstanding under the plan. 
 
 Note J. Pension Plans and Other Retirement Benefits 
 Pension 
 TJX has a funded defined benefit retirement plan that covers 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. The Company has elected the practical expedient pursuant to ASU 2015-4– Compensation-retirement benefits (Topic 715) and has selected the measurement date of January 31, the calendar month end closest to the Company’s fiscal year end. 
 F-27 

 
 

 
 Funded Plan
Fiscal Year Ended Unfunded Plan
Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 January 30,
2021 February 1,
2020 
 
 Change in projected benefit obligation: 
 Projected benefit obligation at beginning of year $ 1,532,416 $ 1,221,170 $ 104,823 $ 96,759 
 Service cost 50,123 44,685 2,430 2,059 
 Interest cost 50,210 52,172 3,283 3,740 
 Actuarial losses 13,758 237,125 8,229 4,682 
 
 Benefits paid ( 24,527 ) ( 19,891 ) ( 5,287 ) ( 2,417 ) 
 Expenses paid ( 2,706 ) ( 2,845 ) — — 
 Projected benefit obligation at end of year $ 1,619,274 $ 1,532,416 $ 113,478 $ 104,823 
 Accumulated benefit obligation at end of year $ 1,481,505 $ 1,383,298 $ 97,451 $ 88,038 

 
 
 
 Funded Plan
Fiscal Year Ended Unfunded Plan
Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 January 30,
2021 February 1,
2020 
 
 Change in plan assets: 
 Fair value of plan assets at beginning of year $ 1,562,274 $ 1,245,335 $ — $ — 
 Actual return on plan assets 151,594 239,675 — — 
 Employer contribution 100 100,000 5,287 2,417 
 
 Benefits paid ( 24,527 ) ( 19,891 ) ( 5,287 ) ( 2,417 ) 
 Expenses paid ( 2,706 ) ( 2,845 ) — — 
 Fair value of plan assets at end of year $ 1,686,735 $ 1,562,274 $ — $ — 
 Reconciliation of funded status: 
 Projected benefit obligation at end of year $ 1,619,274 $ 1,532,416 $ 113,478 $ 104,823 
 Fair value of plan assets at end of year 1,686,735 1,562,274 — — 
 Funded status – excess (asset) obligation $ ( 67,461 ) $ ( 29,858 ) $ 113,478 $ 104,823 
 Net (asset) liability recognized on Consolidated Balance Sheets $ ( 67,461 ) $ ( 29,858 ) $ 113,478 $ 104,823 
 Amounts not yet reflected in net periodic benefit cost and included in Accumulated other comprehensive income (loss): 
 Prior service cost $ 803 $ 1,181 $ — $ — 
 Accumulated actuarial losses 245,506 316,695 35,880 32,266 
 Amounts included in Accumulated other comprehensive income (loss) $ 246,309 $ 317,876 $ 35,880 $ 32,266 

 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 $ 46 million at January 30, 2021 is reflected on the Consolidate Balance Sheets as of that date as a current liability of $ 7 million, a long-term liability of $ 106 million, and a long-term asset of $ 67 million. The combined net accrued liability of $ 75 million at February 1, 2020 is reflected on the Consolidated Balance Sheets as of that date as a current liability of $ 3 million, a long-term liability of $ 102 million, and a long-term asset of $ 30 million. 
 The reduction in the actuarial losses included in Accumulated other comprehensive income (loss) for the funded plan for fiscal 2021 was driven by the actual return on assets which exceeded our estimated return by $ 63 million. 
 F-28 

 
 

 TJX determined the assumed discount rate using the BOND: Link model in fiscal 2021 and fiscal 2020. 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,
2021 February 1,
2020 January 30,
2021 February 1,
2020 
 Discount rate 3.20 % 3.30 % 2.80 % 3.10 % 
 Rate of compensation increase (a) 
 4.00 % 4.00 % 4.00 % 4.00 % 

 
 (a) As of fiscal 2020, the rate of compensation increase for the Unfunded Plan, reflects the rate for participants eligible for the alternative benefit as the participants eligible for the primary benefit no longer accrue benefits under this plan. 
 TJX made aggregate cash contributions of $ 5 million in fiscal 2021, $ 102 million in fiscal 2020 and $ 106 million in fiscal 2019 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. The Company does not anticipate any required funding in fiscal 2022 for the funded plan. The Company anticipates making contributions of $ 4 million to provide current benefits coming due under the unfunded plan in fiscal 2022. 
 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 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 January 30,
2021 February 1,
2020 February 2,
2019 
 
 Net periodic pension cost: 
 Service cost $ 50,123 $ 44,685 $ 45,342 $ 2,430 $ 2,059 $ 2,391 
 Interest cost 50,210 52,172 54,355 3,283 3,740 3,600 
 Expected return on plan assets ( 88,997 ) ( 74,141 ) ( 79,190 ) — — — 
 Amortization of prior service cost 377 377 377 — — — 
 Amortization of net actuarial loss 22,351 19,055 12,250 4,616 3,124 3,409 
 Settlement charge — — 36,122 — — — 
 Total expense $ 34,064 $ 42,148 $ 69,256 $ 10,329 $ 8,923 $ 9,400 
 Other changes in plan assets and benefit obligations recognized in other comprehensive income: 
 Net (gain) loss ( 48,838 ) $ 71,590 $ 68,770 $ 8,229 $ 4,682 $ 5,955 
 Amortization of net (loss) ( 22,351 ) ( 19,055 ) ( 12,250 ) ( 4,616 ) ( 3,124 ) ( 3,409 ) 
 Settlement charge — — ( 36,122 ) — — — 
 Amortization of prior service cost ( 377 ) ( 377 ) ( 377 ) — — — 
 Total recognized in other comprehensive income (loss) $ ( 71,566 ) $ 52,158 $ 20,021 $ 3,613 $ 1,558 $ 2,546 
 Total recognized in net periodic benefit cost and other comprehensive income (loss) $ ( 37,502 ) $ 94,306 $ 89,277 $ 13,942 $ 10,481 $ 11,946 
 Weighted average assumptions for expense purposes: 
 Discount rate 3.30 % 4.30 % 4.00 %/ 4.40 % 
 3.10 % 4.10 % 3.80 % 
 Expected rate of return on plan assets 5.75 % 6.00 % 6.00 %/ 6.00 % 
 N/A N/A N/A 
 Rate of compensation increase (a) 
 4.00 % 4.00 % 4.00 % 4.00 % 6.00 % 6.00 % 

 (a) For fiscal 2020 and fiscal 2019, the rate of compensation increase for participants eligible for the primary benefit under the unfunded plan is 6.00 %. The assumed rate of compensation increase for participants eligible for the alternative benefit under the unfunded plan is 4.00 %. 
 F-29 

 
 

 During the third quarter of fiscal 2019, TJX annuitized and transferred current pension obligations for certain U.S. retirees and beneficiaries under the funded plan through the purchase of a group annuity contract with an insurance company. TJX transferred $ 207 million of pension plan assets to the insurance company, thereby reducing its pension benefit obligations. The transaction had no cash impact on TJX but did result in a non-cash pre-tax pension settlement charge of $ 36 million, which is reported separately on the Consolidated Statements of Income. As a result of the annuity purchase the Company re-measured the funded status of its pension plan as of September 30, 2018. The assumptions for pension expense presented above include a discount rate of 4.00 % through the measurement date and 4.40 % thereafter. The expected rate of return on plan assets is 6.00 % through the measurement date and 6.00 % thereafter. The discount rate for determining the obligation at the measurement date is 4.40 %. 
 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. 
 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 
 2022 $ 35,475 $ 4,088 
 2023 40,692 45,914 
 2024 46,242 6,148 
 2025 51,865 7,356 
 2026 57,629 7,992 
 2027 through 2031 371,352 37,035 

 The following tables present the fair value hierarchy (See Note G—Fair Value Measurements) for pension assets measured at fair value on a recurring basis as of January 30, 2021 and February 1, 2020: 
 
 Funded Plan at January 30, 2021 
 In thousands Level 1 Level 2 Total 
 Asset category: 
 Short-term investments $ 8,598 $ — $ 8,598 
 Equity Securities 174,691 — 174,691 
 Fixed Income Securities: 
 Corporate and government bond funds — 548,667 548,667 
 Futures Contracts — 4,896 4,896 
 Total assets in the fair value hierarchy $ 183,289 $ 553,563 $ 736,852 
 Assets measured at net asset value (a) 
 — — 949,883 
 Fair value of assets $ 183,289 $ 553,563 $ 1,686,735 

 
 
 F-30 

 
 

 
 Funded Plan at February 1, 2020 
 In thousands Level 1 Level 2 Total 
 Asset category: 
 Short-term investments $ 109,953 $ — $ 109,953 
 Equity Securities 231,607 — 231,607 
 Fixed Income Securities: 
 Corporate and government bond funds — 480,519 480,519 
 Futures Contracts — ( 2,540 ) ( 2,540 ) 
 Total assets in the fair value hierarchy $ 341,560 $ 477,979 $ 819,539 
 Assets measured at net asset value (a) 
 — — 742,735 
 Fair value of assets $ 341,560 $ 477,979 $ 1,562,274 

 (a) 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. 
 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, and the 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 qualified pension plan assets as of January 30, 2021 along with the actual allocation of qualified pension plan assets as of the valuation date for the fiscal years presented: 
 
 Target Allocation January 30,
2021 February 1,
2020 
 Return-seeking assets 50 % 48 % 44 % 
 Liability-hedging assets 50 % 51 % 49 % 
 All other – primarily cash — % 1 % 7 % 

 Under TJX’s investment policy, plan assets are to be invested with the objective of generating investment returns that, in combination with funding contributions, provide adequate assets to meet all current and reasonably anticipated future benefit obligations under the plan. The investment policy includes a dynamic asset allocation strategy, whereby, over time, in connection with any improvements in the plan’s funded status, the target allocation of return-seeking assets (generally, equities and other instruments with similar risk profile) may decline and the target allocation of liability-hedging assets (generally, fixed income and other instruments with a similar risk profile) may increase. 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 investment portfolio reviews, annual liability measurements and periodic asset/liability studies. 
 F-31 

 
 

 Other Retirement Benefits 
 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. 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. TJX may also make additional discretionary contributions. Eligible employees are automatically enrolled in the U.S. plan at a 2 % deferral rate, unless the employee elects otherwise. The total cost of TJX contributions to these plans was $ 61 million in fiscal 2021, $ 59 million in fiscal 2020 and $ 61 million in fiscal 2019. 
 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 $ 3 million in fiscal 2021, $ 7 million in fiscal 2020 and $ 6 million in fiscal 2019. Although the plan is unfunded, in order to help meet its future obligations TJX transfers an amount generally equal to employee deferrals and the related company match to a separate “rabbi” trust. The trust assets, which are invested in a variety of mutual funds, are included in other assets on the balance sheets. 
 In addition to the plans described above, TJX also contributes to retirement/deferred savings programs for eligible Associates at certain of its foreign subsidiaries. The Company contributed $ 22 million for these programs in fiscal 2021, $ 20 million for these programs in fiscal 2020 and $ 15 million in fiscal 2019. 
 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 $ 19 million in fiscal 2021, $ 20 million in fiscal 2020 and $ 19 million in fiscal 2019 to the Legacy Plan of the National Retirement Fund (EIN #13-6130178, plan #1), the Adjustable Plan of the National Retirement Fund (EIN #13-6130178, plan #2), the Legacy Plan of the UNITE HERE Retirement Fund (EIN #82-0994119, plan #1) and the Adjustable Plan of the UNITE HERE Retirement Fund (EIN #82-0994119, plan #2). TJX was listed in the Form 5500 for the Legacy Plan of the National Retirement Fund and the Adjustable Plan of the National Retirement Fund as providing more than 5 % of the total contributions for the plan year ending December 31, 2019. In addition, based on information available to TJX, the Pension Protection Act Zone Status for each of the Legacy Plan of the National Retirement Fund and the Legacy Plan of the UNITE HERE Retirement Fund is Critical and rehabilitation plans have 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, or in certain other circumstances, 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. 
 F-32 

 
 
 

 Note K. Long-Term Debt and Credit Lines 
 The table below presents long-term debt, exclusive of current installments, as of January 30, 2021 and February 1, 2020. All amounts are net of unamortized debt discounts. 
 
 In thousands January 30,
2021 February 1,
2020 
 General corporate debt: 
 2.750 % senior unsecured notes, maturing June 15, 2021 (effective interest rate of 2.76 % after reduction of unamortized debt discount of $ 25 and $ 100 in fiscal 2021 and 2020, respectively) 
 $ 749,975 $ 749,900 
 2.500 % senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51 % after reduction of unamortized debt discount of $ 100 and $ 145 in fiscal 2021 and 2020, respectively) 
 499,900 499,855 
 3.500 % senior unsecured notes, maturing April 15, 2025 (effective interest rate of 3.58 % after reduction of unamortized debt discount of $ 4,208 in fiscal 2021) 
 1,245,792 — 
 2.250 % senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32 % after reduction of unamortized debt discount of $ 4,165 and $ 4,911 in fiscal 2021 and 2020, respectively) 
 995,835 995,089 
 3.750 % senior unsecured notes, maturing April 15, 2027 (effective interest rate of 3.76 % after reduction of unamortized debt discount of $ 456 in fiscal 2021) 
 749,544 — 
 1.150 % senior unsecured notes, maturing May 15, 2028 (effective interest rate of 1.18 % after reduction of unamortized debt discount of $ 939 in fiscal 2021) 
 499,061 — 
 3.875 % senior unsecured notes, maturing April 15, 2030 (effective interest rate of 3.89 % after reduction of unamortized debt discount of $ 568 in fiscal 2021) 
 495,282 — 
 1.600 % senior unsecured notes, maturing May 15, 2031 (effective interest rate of 1.61 % after reduction of unamortized debt discount of $ 610 in fiscal 2021) 
 499,390 — 
 4.500 % senior unsecured notes, maturing April 15, 2050 (effective interest rate of 4.52 % after reduction of unamortized debt discount of $ 2,208 in fiscal 2021) 
 383,291 — 
 Total Debt 6,118,070 2,244,844 
 Current maturities of long-term debt, net of debt issuance costs ( 749,684 ) — 
 Debt issuance cost ( 35,465 ) ( 8,219 ) 
 Long-term debt $ 5,332,921 $ 2,236,625 

 The aggregate maturities of long-term debt, inclusive of current installments at January 30, 2021 are as follows: 
 
 In thousands Long-Term
Debt 
 Fiscal Year 
 2022 
 $ 750,000 
 2023 — 
 2024 500,000 
 2025 — 
 2026 1,250,000 
 Later years 3,631,349 
 Less: amount representing unamortized debt discount ( 13,279 ) 
 Less: amount representing debt issuance cost ( 35,465 ) 
 Less: current maturities of long-term debt ( 749,684 ) 
 Aggregate maturities of long-term debt $ 5,332,921 

 In April 2020, given the rapidly changing environment and level of uncertainty created by the COVID-19 pandemic and the associated impact on future earnings, TJX completed the issuance and sale of (a) $ 1.25 billion aggregate principal amount of 3.500 % notes due 2025, (b) $ 750 million aggregate principal amount of 3.750 % notes due 2027, (c) $ 1.25 billion aggregate principal amount of 3.875 % notes due 2030 and (d) $ 750 million aggregate principal amount of 4.500 % notes due 2050. Interest on these notes are payable semi-annually. In December 2020, TJX accepted $ 1.12 billion in aggregate principal amount of certain of its notes issued in April 2020 pursuant to cash tender offers as foll ows: $ 365 million of the 2050 Notes and $ 754 million of the 2030 Notes. TJX paid $ 1.42 billion aggregate consideration in connection with the tender offers (including transaction costs) and recorded a $ 0.3 billion pre-tax loss on the early extinguishment for the accepted notes. 
 F-33 

 
 

 In November 2020, TJX completed the issuance of (a) $ 500 million aggregate principal amount of 1.150 % notes due 2028 and (b) $ 500 million aggregate principal amount of 1.600 % notes due 2031. Cash proceeds, net of discounts and other issuance costs, were $ 990 million. Interest on the 2028 and 2031 Notes is payable semi-annually beginning May 2021. TJX used the net proceeds from the offering of the 2028 and 2031 Notes to partially fund the purchase of the accepted notes from its December 2020 tender offers. 
 At January 30, 2021, TJX had outstanding $ 1 billion aggregate principal amount of 2.250 % ten-year notes due September 2026 and $ 500 million aggregate principal amount of 2.500 % ten-year notes due May 2023. TJX entered into a rate-lock agreement to hedge $ 700 million of the 2.250 % notes and $ 250 million of the 2.500 % notes prior to their issuance. The cost of these agreements are being amortized to interest expense over the term of the notes resulting in an effective fixed rate of 2.36 % for the 2.25 % notes and 2.57 % for the 2.50 % notes. 
 At January 30, 2021, TJX also had outstanding $ 750 million aggregate principal amount of 2.750 % seven-year notes due June 2021. TJX also entered into rate-lock agreements to hedge the underlying treasury rate of all of the 2.750 % notes prior to their issuance. The agreements were accounted for as cash flow hedges and the pre-tax realized loss of $ 8 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 %. 
 At January 30, 2021, TJX had a $ 500 million 364 Day Revolving Credit Facility that matures in August 2021 (the “364-Day Revolving Credit Facility”), a $ 500 million revolving credit facility that matures in March 2022 (the “2022 Revolving Credit Facility”), and a $ 500 million revolving credit facility that matures in May 2024 (the “2024 Revolving Credit Facility”). Under these credit facilities, TJX has borrowing capacity of $ 1.5 billion, all of which remains available to the Company. I n July 2020, TJX paid off the $ 1 billion it had drawn down on the 2022 Revolving Credit Facility and 2024 Revolving Credit Facility during the first quarter of fiscal 2021. The six-month interest rate on these borrowings was 1.757 % through May 15, 2020, and increased to 2.007 % through the payoff date. The terms of these revolving credit facilities require quarterly payments on the committed amount and payment of interest on borrowings at rates based on LIBOR or a base rate plus a variable margin, in each case based on the TJX’s long term debt ratings. The 2022 Revolving Credit Facility and the 2024 Revolving Credit Facility require usages fees based on total credit extensions under such facilities. As of January 30, 2021 and February 1, 2020, there were no amounts outstanding under these facilities. 
 Beginning with the fiscal quarter ending May 1, 2021, the terms and covenants under the revolving credit facilities require TJX to maintain a quarterly-tested leverage ratio of funded debt to earnings before interest, taxes, depreciation and amortization and rentals (“EBITDAR”) of not more than 5.00 to 1.00 for the four fiscal quarter period then ended (a “Test Period”), with an incremental 0.5 0 stepdown each Test Period thereafter, until the fourth quarter of fiscal 2022 when the new covenant of 3.50 to 1.00 permanently applies. In addition, TJX is required to maintain a minimum liquidity of at least $ 1.5 billion through the period ending April 30, 2021, and a minimum EBITDAR of $ 650 million for the fiscal quarter ending January 30, 2021. TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented. 
 As of January 30, 2021 and February 1, 2020, TJX Canada had two uncommitted credit lines, a C$ 10 million facility for operating expenses and a C$ 10 million letter of credit facility. As of January 30, 2021 and February 1, 2020, and during the years then ended, there were no amounts outstanding on the Canadian credit line for operating expenses. As of January 30, 2021 and February 1, 2020, and during the years then ended, our European business at TJX International had an uncommitted credit line of £ 5 million. As of January 30, 2021 and February 1, 2020, there were no amounts outstanding on the European credit line. 
 
 Note L. Income Taxes 
 For financial reporting purposes, components of income before income taxes are as follows: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 
 
 United States $ 642,482 $ 3,742,227 $ 3,463,785 
 Foreign ( 553,219 ) 663,956 709,426 
 Income before income taxes $ 89,263 $ 4,406,183 $ 4,173,211 

 F-34 

 
 

 The (benefit) provision for income taxes includes the following: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 
 
 Current: 
 Federal $ 189,854 $ 708,508 $ 711,369 
 State 36,246 250,830 251,187 
 Foreign 4,985 181,061 238,692 
 Deferred: 
 Federal ( 97,705 ) 9,409 ( 62,278 ) 
 State ( 25,406 ) ( 8,203 ) ( 27,831 ) 
 Foreign ( 109,181 ) ( 7,615 ) 2,274 
 (Benefit) provision for income taxes $ ( 1,207 ) $ 1,133,990 $ 1,113,413 

 TJX had net deferred tax assets (liabilities) as follows: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 
 Deferred tax assets: 
 Net operating loss carryforward $ 171,568 $ 57,886 
 
 Pension, stock compensation, postretirement and employee benefits 272,872 290,144 
 
 Operating lease liabilities 2,409,392 2,384,486 
 Accruals and reserves 
 239,696 125,022 
 Other 
 14,750 16,349 
 Total gross deferred tax assets $ 3,108,278 $ 2,873,887 
 Valuation allowance ( 76,682 ) ( 60,086 ) 
 Net deferred tax asset $ 3,031,596 $ 2,813,801 
 Deferred tax liabilities: 
 Property, plant and equipment $ 530,675 $ 557,848 
 Capitalized inventory 47,769 46,778 
 Operating lease right of use assets 2,321,733 2,315,690 
 Tradename / intangibles 17,391 15,705 
 Undistributed foreign earnings 4,789 1,806 
 Other 19,212 6,012 
 Total deferred tax liabilities $ 2,941,569 $ 2,943,839 
 Net deferred tax asset (liability) $ 90,027 $ ( 130,038 ) 
 Non-current asset $ 127,191 $ 12,132 
 Non-current liability ( 37,164 ) ( 142,170 ) 
 Total $ 90,027 $ ( 130,038 ) 

 TJX has provided for all applicable state and foreign withholding taxes on all undistributed earnings of its foreign subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong and Vietnam through January 30, 2021. The Company has not provided for federal, state, or foreign withholding taxes on the approximately $ 1 billion of undistributed earnings related to all other foreign subsidiaries as such earnings are considered to be indefinitely reinvested in the business. The net amount of unrecognized state and foreign withholding tax liabilities related to the undistributed earnings is not material. 
 F-35 

 
 

 As of January 30, 2021 and February 1, 2020, for state income tax purposes, TJX had net operating loss carryforwards of $ 224 million and $ 190 million respectively, which expire, if unused, in the years 2022 through 2041 . 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 $ 14 million has been provided for the deferred tax asset as of January 30, 2021 and $ 13 million as of February 1, 2020. 
 The Company had available for foreign income tax purposes net operating loss carryforwards of $ 626 million (related to Australia, Austria, Germany, the Netherlands, Poland and the U.K.) as of January 30, 2021, and $ 156 million (related to Australia, Austria and the Netherlands) as of February 1, 2020. Of the net operating loss carryforwards as of January 30, 2021, $ 48 million will expire, if unused, in fiscal years 2025 through 2028 . 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 $ 62 million as of January 30, 2021, and approximately $ 47 million as of February 1, 2020. 
 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,
2021 February 1,
2020 February 2,
2019 
 
 U.S. federal statutory income tax rate 21.0 % 21.0 % 21.0 % 
 Effective state income tax rate 28.1 4.6 4.5 
 Impact of foreign operations 21.4 0.8 1.2 
 Excess share-based compensation ( 59.4 ) ( 1.3 ) ( 1.2 ) 
 Tax credits ( 8.9 ) — — 
 Nondeductible / nontaxable items ( 3.3 ) — — 
 Impact of 2017 Tax Act — — 1.5 
 All other ( 0.3 ) 0.6 ( 0.3 ) 
 Worldwide effective income tax rate ( 1.4 ) % 25.7 % 26.7 % 

 TJX’s effective income tax rate decreased for fiscal 2021 as compared to fiscal 2020. The decrease in the fiscal 2021 effective income tax rate is primarily driven by the negative impact of the COVID-19 pandemic to the Company’s results and the change in the jurisdictional mix of income and losses. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) was signed into law, which provides emergency economic assistance for American workers, families and businesses affected by the COVID-19 pandemic. The CARES Act does not have a significant impact on our fiscal 2021 tax expense. 
 The 2017 Tax Act made broad and complex changes to the U.S. tax code which had a significant impact on our fiscal 2018 and fiscal 2019 tax expense, including reducing the U.S. federal corporate tax rate from 35% to 21%, expanded rules regarding expensing of fixed assets, and required one-time transition tax on certain undistributed earnings of foreign subsidiaries. Other provisions that became effective in Fiscal 2019 impacting income taxes include: an exemption from U.S. tax on dividends of future foreign earnings, expanded limitations on executive compensation, a minimum tax on certain foreign earnings in excess of 10 % of the foreign subsidiaries tangible assets (i.e. global intangible low-taxed income or “GILTI”), and allows a benefit for foreign derived intangible income (“FDII”). 
 In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118, which allows a measurement period, not to exceed one year, to finalize the accounting for the income tax impacts of the 2017 Tax Act. The Company completed our analysis in the fourth quarter of fiscal 2019 and determined there was no material adjustment to the income tax expense. The Company has recorded current tax on GILTI relative to fiscal 2020 operations and will continue to account for GILTI as a period cost when incurred. 
 TJX had net unrecognized tax benefits of $ 272 million as of January 30, 2021, $ 255 million as of February 1, 2020 and $ 233 million as of February 2, 2019. 
 F-36 

 
 

 A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 February 2,
2019 
 Balance, beginning of year $ 259,359 $ 244,195 $ 61,704 
 Additions for uncertain tax positions taken in current year 11,751 21,559 7,406 
 Additions for uncertain tax positions taken in prior years 834 722 177,741 
 
 Reductions resulting from lapse of statute of limitations ( 2,352 ) ( 4,022 ) ( 1,388 ) 
 Settlements with tax authorities ( 221 ) ( 3,095 ) ( 1,268 ) 
 Balance, end of year $ 269,371 $ 259,359 $ 244,195 

 Included in the gross amount of unrecognized tax benefits are items that will impact future effective tax rates upon recognition. These items amounted to $ 250 million as of January 30, 2021, $ 240 million as of February 1, 2020 and $ 222 million as of February 2, 2019. 
 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. and India, fiscal years through 2010 are no longer subject to examination. In all other jurisdictions, fiscal years through 2011 are no longer subject to examination. 
 TJX’s accounting policy is to classify interest and penalties related to income tax matters as part of income tax expense. The amount of interest and penalties expensed was $ 8 million for the year ended January 30, 2021, $ 5 million for the year ended February 1, 2020 and $ 12 million for the year ended February 2, 2019. The accrued amounts for interest and penalties are $ 36 million as of January 30, 2021, $ 28 million as of February 1, 2020 and $ 24 million as of February 2, 2019. 
 Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statutes 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, 2021. During the next twelve months, it is reasonably possible that tax audit resolutions may reduce unrecognized tax benefits by $ 0 to $ 40 million, which would reduce the provision for taxes on earnings. 
 
 Note M. Leases 
 TJX is committed under long-term leases related to its continuing operations for the rental of real estate and certain service contracts containing embedded leases, all of which are operating leases. Real estate leases represent virtually all of our store locations as well as some of our distribution centers and office space. Most of TJX’s leases in the U.S. and Canada are store operating leases with ten-year terms and options to extend for one or more five-year periods. Leases in Europe generally have an initial term of ten to fifteen years and leases in Australia generally have an initial lease term of primarily seven to ten years , some of which have options to extend. Many of the Company's leases have options to terminate prior to the lease expiration date. The exercise of both lease renewal and termination options is at our sole discretion and is not reasonably certain at lease commencement. The Company has deemed that the expense of store renovations makes the renewal of the next lease option reasonably certain to be exercised after these renovations occur. 
 While the overwhelming majority of leases have fixed payment schedules, some leases have variable lease payments based on market indices adjusted periodically for inflation, or include rental payments based on a percentage of retail sales over contractual levels. In addition, for real estate leases, TJX is generally required to pay insurance, real estate taxes and other operating expenses including common area maintenance based on a proportionate share of premises, and some of these costs are based on a market index, primarily in Canada. For leases with these payments based on a market index, the initial lease payment amount is used in the calculation of the operating lease liability and corresponding operating lease assets included on the Consolidated Balance Sheets. Future payment changes to these market index rate leases are not reflected in the operating lease liability and are instead included in variable lease cost. Variable lease cost also includes variable operating expenses for third party service centers and dedicated transportation contracts that are deemed embedded leases. The operating lease ROU assets also includes any lease payments made in advance of the assets use and is reduced by lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term. 
 F-37 

 
 

 Supplemental balance sheet information related to leases is as follows: 
 
 Fiscal Year Ended 
 January 30,
2021 February 1,
2020 
 Weighted-average remaining lease term 6.8 years 7.2 years 
 Weighted-average discount rate 2.6 % 2.9 % 

 
 
 The following table is a summary of the Company’s components of net lease cost for the fiscal years ended: 
 
 Fiscal Year Ended 
 In thousands Classification January 30,
2021 February 1,
2020 
 Operating lease cost Cost of sales, including buying and occupancy costs $ 1,820,396 $ 1,752,122 
 Variable and short term lease cost Cost of sales, including buying and occupancy costs 1,162,971 1,226,716 
 Total lease cost $ 2,983,367 $ 2,978,838 

 Supplemental cash flow information related to leases is as follows: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 
 Cash paid for amounts included in the measurement of lease liabilities: 
 Operating cash flows paid for operating leases $ 1,663,005 $ 1,736,403 
 Lease liabilities arising from obtaining right of use assets $ 1,380,402 $ 1,786,212 

 During fiscal 2021, the Company negotiated rent deferrals (primarily for second quarter lease payments) for a significant number of our stores, with repayment at later dates, primarily in fiscal 2022. See Note B—Impact of the COVID-19 Pandemic for additional information. 
 The following table summarizes the maturity of lease liabilities under operating leases as of January 30, 2021: 
 
 In thousands January 30,
2021 
 Fiscal Year 
 2022 $ 2,049,652 
 2023 1,741,490 
 2024 1,559,123 
 2025 1,331,267 
 2026 1,087,555 
 Later years 2,507,701 
 Total lease payments (a) 
 10,276,788 
 Less: imputed interest (b) 
 855,967 
 Total lease liabilities (c) 
 $ 9,420,821 

 (a) Operating lease payments exclude legally binding minimum lease payments for leases signed but not yet commenced and include options to extend lease terms that are now deemed reasonably certain of being exercised according to our Lease Accounting Policy. 
 (b) Calculated using the incremental borrowing rate for each lease. 
 (c) Total lease liabilities are broken out on the Consolidated Balance Sheets between Current portion of operating lease liabilities and Long-term operating lease liabilities. 
 F-38 

 
 
 

 Note N. Accrued Expenses and Other Liabilities, Current and Long Term 
 The major components of accrued expenses and other current liabilities are as follows: 
 
 Fiscal Year Ended 
 In thousands January 30,
2021 February 1,
2020 
 Employee compensation and benefits, current 
 $ 946,229 $ 819,368 
 Merchandise credits and gift certificates 576,187 500,844 
 Dividends payable 315,604 281,703 
 Occupancy costs, including rent, utilities and real estate taxes 
 314,850 283,383 
 Sales tax collections and V.A.T. taxes 115,409 195,059 
 Accrued capital additions 89,110 125,361 
 All other current liabilities 
 1,114,070 836,056 
 Total accrued expenses and other current liabilities $ 3,471,459 $ 3,041,774 

 All other current liabilities include accruals for insurance, expense payables, customer rewards liability, reserve for sales returns, reserve for taxes, interest, advertising, fair value of derivatives 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,
2021 February 1,
2020 
 Employee compensation and benefits, long-term $ 679,661 $ 514,788 
 Tax reserve, long-term 264,104 255,371 
 Asset retirement obligation 58,385 52,214 
 
 
 
 
 All other long-term liabilities 61,752 28,743 
 Total other long-term liabilities $ 1,063,902 $ 851,116 

 
 
 
 Note O. Contingent Obligations, Contingencies, and Commitments 
 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. The Company has had numerous leases from its former operations where its guarantee required it to satisfy some of these lease obligations and TJX established appropriate reserves. The Company may be contingently liable on up to eight leases of former TJX businesses, for which the Company believes the likelihood of future liability to TJX is remote. The Company may also be contingently liable for assignments and subleases if the assignees or subtenants do not fulfill their obligations. TJX estimates the undiscounted value of these contingent obligations as of January 30, 2021 to be approximately $ 11 million. TJX believes that most or all of these contingent obligations will not revert to the Company and, to the extent they do, may be resolved for substantially less due to mitigating factors including TJX's ability to potentially further sublet. 
 TJX is a party to various agreements under which it may be obligated to indemnify the other party with respect to certain losses related to matters including title to assets sold, specified environmental matters or certain income taxes. These obligations are often limited in time and amount. There are no amounts reflected in our Consolidated 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, collective, and/or representative 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. The lawsuits are in various procedural stages and seek monetary damages, injunctive relief and attorneys’ fees. In connection with ongoing litigation, an immaterial amount has been accrued in the accompanying Consolidated Financial Statements. 
 F-39 

 
 

 Letters of Credit 
 TJX had outstanding letters of credit totaling $ 28 million as of January 30, 2021 and $ 30 million as of February 1, 2020. Letters of credit are issued by TJX primarily for the purchase of inventory. 
 
 Note P. Supplemental Cash Flow 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,
2021 February 1,
2020 February 2,
2019 
 
 Cash paid for: 
 Interest on debt (a) 
 $ 153,045 $ 56,322 $ 64,007 
 Income taxes (b) 
 146,008 1,280,680 1,147,511 
 Non-cash investing and financing activity: 
 Dividends payable $ 33,714 $ 40,226 $ 42,943 
 Property additions ( 36,251 ) 6,189 28,836 
 Build-to-suit construction in progress (c) 
 — — ( 40,911 ) 
 Build-to-suit lease obligation (c) 
 — — 40,911 

 (a) Increased interest is due to the issuance of additional debt due to the COVID-19 pandemic. 
 (b) Decreased income taxes is primarily due to lower profits due to the COVID-19 pandemic and the change in the jurisdictional mix of profits and losses. 
 (c) The assets and liabilities related to non-TJX owned properties that had previously existed under build-to-suit accounting have been de-recognized in fiscal 2020 upon adoption of the new lease accounting standard. 
 
 Note Q. Selected Quarterly Financial Data (Unaudited) 
 Presented below is selected quarterly consolidated financial data for fiscal 2021 and fiscal 2020 which was prepared on the same basis as the audited consolidated financial statements and includes all adjustments necessary to state fairly, in all material respects, the information set forth therein on a consistent basis. 
 
 Amounts in thousands except per share amounts First 
 Quarter (a) 
 Second 
 Quarter (a) 
 Third 
 Quarter (a) 
 Fourth 
 Quarter (a) 
 
 Fiscal Year Ended January 30, 2021 
 
 Net sales $ 4,408,888 $ 6,667,575 $ 10,117,289 $ 10,943,210 
 Gross earnings (b) 
 ( 5,577 ) 1,493,085 3,055,004 3,060,635 
 Net income (c) 
 ( 887,489 ) ( 214,220 ) 866,656 325,523 
 Basic earnings per share (d) 
 ( 0.74 ) ( 0.18 ) 0.72 0.27 
 Diluted earnings per share (d) 
 ( 0.74 ) ( 0.18 ) 0.71 0.27 
 Fiscal Year Ended February 1, 2020 
 
 Net sales $ 9,277,585 $ 9,781,596 $ 10,451,334 $ 12,206,462 
 Gross earnings (b) 
 2,639,700 2,755,539 3,011,301 3,464,657 
 Net income 700,178 758,962 828,263 984,790 
 Basic earnings per share 
 0.58 0.63 0.69 0.82 
 Diluted earnings per share 
 0.57 0.62 0.68 0.81 

 (a) Fiscal 2021 quarters reflect the impact of the COVID-19 pandemic. 
 (b) Gross earnings equal net sales less cost of sales, including buying and occupancy costs. 
 (c) The fourth quarter of fiscal 2021 includes a $ 0.3 billion early extinguishment of debt charge. 
 (d) As a result of the net loss for the first and second quarters of fiscal 2021, basic and diluted earnings per share were the same. 
 F-40
TJX COMPANIES INC /DE/ 10-K

Item 9A. Controls and Procedures
