Document and Entity Information (USD $)
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12 Months Ended | ||
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Sep. 30, 2011
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Nov. 09, 2011
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Mar. 31, 2011
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Document and Entity Information [Abstract] | |||
Entity Registrant Name | BEAZER HOMES USA INC | ||
Entity Central Index Key | 0000915840 | ||
Document Type | 10-K | ||
Document Period End Date | Sep. 30, 2011 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2011 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 345,892,003 | ||
Entity Common Stock, Shares Outstanding | 75,548,949 |
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If the value is true, then the document as an amendment to previously-filed/accepted document. No definition available.
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- Definition
End date of current fiscal year in the format --MM-DD. No definition available.
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- Definition
This is focus fiscal period of the document report. For a first quarter 2006 quarterly report, which may also provide financial information from prior periods, the first fiscal quarter should be given as the fiscal period focus. Values: FY, Q1, Q2, Q3, Q4, H1, H2, M9, T1, T2, T3, M8, CY. No definition available.
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- Definition
This is focus fiscal year of the document report in CCYY format. For a 2006 annual report, which may also provide financial information from prior periods, fiscal 2006 should be given as the fiscal year focus. Example: 2006. No definition available.
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The end date of the period reflected on the cover page if a periodic report. For all other reports and registration statements containing historical data, it is the date up through which that historical data is presented. If there is no historical data in the report, use the filing date. The format of the date is CCYY-MM-DD. No definition available.
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- Definition
The type of document being provided (such as 10-K, 10-Q, N-1A, etc). The document type is limited to the same value as the supporting SEC submission type, minus any "/A" suffix. The acceptable values are as follows: S-1, S-3, S-4, S-11, F-1, F-3, F-4, F-9, F-10, 6-K, 8-K, 10, 10-K, 10-Q, 20-F, 40-F, N-1A, 485BPOS, 497, NCSR, N-CSR, N-CSRS, N-Q, 10-KT, 10-QT, 20-FT, POS AM and Other. No definition available.
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- Definition
A unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Indicate number of shares outstanding of each of registrant's classes of common stock, as of latest practicable date. Where multiple classes exist define each class by adding class of stock items such as Common Class A [Member], Common Class B [Member] onto the Instrument [Domain] of the Entity Listings, Instrument No definition available.
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- Definition
Indicate "Yes" or "No" whether registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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Indicate whether the registrant is one of the following: (1) Large Accelerated Filer, (2) Accelerated Filer, (3) Non-accelerated Filer, or (4) Smaller Reporting Company. Definitions of these categories are stated in Rule 12b-2 of the Exchange Act. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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- Definition
State aggregate market value of voting and non-voting common equity held by non-affiliates computed by reference to price at which the common equity was last sold, or average bid and asked price of such common equity, as of the last business day of registrant's most recently completed second fiscal quarter. The public float should be reported on the cover page of the registrants form 10K. No definition available.
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The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Indicate "Yes" or "No" if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. No definition available.
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- Definition
Indicate "Yes" or "No" if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Is used on Form Type: 10-K, 10-Q, 8-K, 20-F, 6-K, 10-K/A, 10-Q/A, 20-F/A, 6-K/A, N-CSR, N-Q, N-1A. No definition available.
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- Definition
Aggregate dividends paid during the period for each share of common stock outstanding. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of expense recognized in the current period that reflects the allocation of the cost of tangible assets over the assets' useful lives. Includes production and non-production related depreciation. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of net income or loss for the period per each share in instances when basic and diluted earnings per share are the same amount and reported as a single line item on the face of the financial statements. Basic earnings per share is the amount of net income or loss for the period per each share of common stock or unit outstanding during the reporting period. Diluted earnings per share includes the amount of net income or loss for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period. No definition available.
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- Definition
Amount represents the difference between the fair value of the payments made and the carrying amount of the debt at the time of its extinguishment. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate total of expenses of managing and administering the affairs of an entity, including affiliates of the reporting entity, which are not directly or indirectly associated with the manufacture, sale or creation of a product or product line. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Loss recognized during the period that results from the write-down of goodwill after comparing the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. Goodwill is assessed at least annually for impairment. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate revenue less cost of goods and services sold or operating expenses directly attributable to the revenue generation activity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate costs related to design, development, general contracting, remodeling, and renovation services for residential buildings, including single-family houses, multifamily housing, townhomes, apartments, and modular housing. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
This element represents the income or loss from continuing operations attributable to the parent which may also be defined as revenue less expenses and taxes from ongoing operations before extraordinary items but after deduction of those portions of income or loss from continuing operations that are allocable to noncontrolling interests, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
This element represents the income or loss from continuing operations attributable to the economic entity which may also be defined as revenue less expenses from ongoing operations, after income or loss from equity method investments, but before income taxes, extraordinary items, and noncontrolling interest. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of net income (loss) from continuing operations per each basic and diluted share of common stock or unit when the per share amount is the same for both basic and diluted shares. No definition available.
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- Definition
This element represents the overall income (loss) from a disposal group apportioned to the parent that is classified as a component of the entity, net of income tax, reported as a separate component of income before extraordinary items after deduction or consideration of the amount which may be allocable to noncontrolling interests, if any. Includes the following (net of tax): income (loss) from operations during the phase-out period, gain (loss) on disposal, provision (or any reversals of earlier provisions) for loss on disposal, and adjustments of a prior period gain (loss) on disposal. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of income (loss) derived from discontinued operations during the period, net of related tax effect, per each basic and diluted share of common stock or unit when the per share amount is the same for both basic and diluted shares. No definition available.
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- Definition
This item represents the entity's proportionate share for the period of the net income (loss) of its investee (such as unconsolidated subsidiaries and joint ventures) to which the equity method of accounting is applied. This item includes income or expense related to stock-based compensation based on the investor's grant of stock to employees of an equity method investee. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The sum of the current income tax expense or benefit and the deferred income tax expense or benefit pertaining to continuing operations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Charge to cost of goods sold that represents the reduction of the carrying amount of inventory, generally attributable to obsolescence or market conditions. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The net result for the period of deducting operating expenses from operating revenues. No definition available.
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- Definition
The net amount of other income and expense amounts, the components of which are not separately disclosed on the income statement, resulting from ancillary business-related activities (that is, excluding major activities considered part of the normal operations of the business) also known as other nonoperating income (expense) recognized for the period. Such amounts may include: (a) dividends, (b) interest on securities, (c) net gains or losses on securities, (d) unusual costs, (e) gains or losses on foreign exchange transactions, and (f) miscellaneous other income and expense items. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate revenue from real estate operations during the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Primarily represents commissions incurred in the period based upon the sale by commissioned employees or third parties of the entity's goods or services, and fees for sales assistance or product enhancements performed by third parties (such as a distributor or value added reseller). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The average number of shares or units issued and outstanding that are used in calculating basic and diluted EPS. No definition available.
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- Definition
Obligations related to consolidated inventory not owned No definition available.
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- Definition
Carrying value as of the balance sheet date of obligations incurred (and for which invoices have typically been received) and payable to vendors for goods and services received that are used in an entity's business. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
For an unclassified balance sheet, the amount due from customers or clients for goods or services that have been delivered or sold in the normal course of business, reduced to their estimated net realizable fair value by an allowance established by the entity of the amount it deems uncertain of collection. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Value received from shareholders in common stock-related transactions that are in excess of par value or stated value and amounts received from other stock-related transactions. Includes only common stock transactions (excludes preferred stock transactions). May be called contributed capital, capital in excess of par, capital surplus, or paid-in capital. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Cash includes currency on hand as well as demand deposits with banks or financial institutions. It also includes other kinds of accounts that have the general characteristics of demand deposits in that the customer may deposit additional funds at any time and effectively may withdraw funds at any time without prior notice or penalty. Cash equivalents, excluding items classified as marketable securities, include short-term, highly liquid Investments that are both readily convertible to known amounts of cash, and so near their maturity that they present minimal risk of changes in value because of changes in interest rates. Generally, only investments with original maturities of three months or less qualify under that definition. Original maturity means original maturity to the entity holding the investment. For example, both a three-month US Treasury bill and a three-year Treasury note purchased three months from maturity qualify as cash equivalents. However, a Treasury note purchased three years ago does not become a cash equivalent when its remaining maturity is three months. Short-term investments, exclusive of cash equivalents, generally consist of marketable securities intended to be sold within one year (or the normal operating cycle if longer) and may include trading securities, available-for-sale securities, or held-to-maturity securities (if maturing within one year), as applicable. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate par or stated value of issued nonredeemable common stock (or common stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable common shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate tax effects as of the balance sheet date of all future tax deductions arising from temporary differences between tax basis and generally accepted accounting principles basis recognition of assets, liabilities, revenues and expenses, which can only be deducted for tax purposes when permitted under enacted tax laws; net of deducting the allocated valuation allowance, if any, to reduce such amount to net realizable value. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Carrying amount as of the balance sheet date of income taxes previously overpaid to tax authorities (such as U.S. Federal, state and local tax authorities) representing refunds of overpayments or recoveries based on agreed-upon resolutions of disputes. Also called income tax refund receivable. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The net carrying amount as of the balance sheet date of the sum of the various components of an operative builder's inventory, including finished homes. Operative builders primarily consist of entities that develop land, construct residential homes and commercial and industrial buildings thereon, and sell them to home buyers and operators of the commercial and industrial properties. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total of (1) improvements, (2) held-for-sale, (3) land and land under development, (4) construction-in-process, (5) mortgage loans held-in-inventory, and (6) other real estate investments which are considered inventory due to being held for sale or disposition. No definition available.
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- Definition
Total investments in (A) an entity in which the entity has significant influence, but does not have control, (B) subsidiaries that are not required to be consolidated and are accounted for using the equity and or cost method, and (C) an entity in which the reporting entity shares control of the entity with another party or group. Includes long-term advances receivable from a party that is affiliated with the reporting entity by means of direct or indirect ownership. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The carrying amount as of the balance sheet date of land not owned but under a contract in which the entity has an option to purchase the land. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total of all Liabilities and Stockholders' Equity items (or Partners' Capital, as applicable), including the portion of equity attributable to noncontrolling interests, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Including the current and noncurrent portions, aggregate carrying amount of all types of notes payable, as of the balance sheet date, with initial maturities beyond one year or beyond the normal operating cycle, if longer. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate carrying amounts, as of the balance sheet date, of assets not separately disclosed in the balance sheet. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The aggregate carrying amount, as of the balance sheet date, of liabilities not separately disclosed in the balance sheet. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Aggregate par or stated value of issued nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable preferred shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Tangible assets that are held by an entity for use in the production or supply of goods and services, for rental to others, or for administrative purposes and that are expected to provide economic benefit for more than one year; net of accumulated depreciation. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The carrying amounts of cash and cash equivalent items which are restricted as to withdrawal or usage. Restrictions may include legally restricted deposits held as compensating balances against borrowing arrangements, contracts entered into with others, or entity statements of intention with regard to particular deposits; however, time deposits and short-term certificates of deposit are not generally included in legally restricted deposits. Excludes compensating balance arrangements that are not agreements which legally restrict the use of cash amounts shown on the balance sheet. This element is for unclassified presentations; for classified presentations there is a separate and distinct element. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The cumulative amount of the reporting entity's undistributed earnings or deficit. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified |
Sep. 30, 2011
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Sep. 30, 2010
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ASSETS | ||
Allowances for accounts receivable | $ 3,872 | $ 3,567 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Discounts on total debt | $ 23,243 | $ 23,617 |
Stockholders' equity: | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 180,000,000 | 180,000,000 |
Common stock, shares issued | 75,588,396 | 75,669,381 |
Common stock, shares outstanding | 75,588,396 | 75,669,381 |
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- Definition
For an unclassified balance sheet, a valuation allowance for receivables due a company that are expected to be uncollectible. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Details
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- Definition
Face amount or stated value of common stock per share; generally not indicative of the fair market value per share. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The maximum number of common shares permitted to be issued by an entity's charter and bylaws. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total number of common shares of an entity that have been sold or granted to shareholders (includes common shares that were issued, repurchased and remain in the treasury). These shares represent capital invested by the firm's shareholders and owners, and may be all or only a portion of the number of shares authorized. Shares issued include shares outstanding and shares held in the treasury. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total number of shares of common stock held by shareholders. May be all or portion of the number of common shares authorized. These shares represent the ownership interest of the common shareholders. Shares outstanding equals shares issued minus shares held in treasury and other adjustments, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The amount of debt discount that was originally recognized at the issuance of the instrument that has yet to be amortized. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Details
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- Definition
Face amount or stated value per share of nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer); generally not indicative of the fair market value per share. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The maximum number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) permitted to be issued by an entity's charter and bylaws. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Total number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) issued to shareholders (includes related preferred shares that were issued, repurchased, and remain in the treasury). May be all or portion of the number of preferred shares authorized. Excludes preferred shares that are classified as debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Details
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- Definition
Issuance of prepaid stock purchase contracts No definition available.
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X | ||||||||||
- Definition
Return and retirement of unvested & vested restricted stock, shares No definition available.
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- Definition
Return and retirement of unvested & vested restricted stock No definition available.
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- Definition
This element represents the amount of recognized equity-based compensation related to nonvested shares during the period, that is, the amount recognized as expense in the income statement (or as asset if compensation is capitalized). No definition available.
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- Definition
This element represents the amount of recognized equity-based compensation related to stock options during the period, that is, the amount recognized as expense in the income statement (or as asset if compensation is capitalized). No definition available.
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- Definition
Tax benefit associated with any equity-based compensation plan other than an employee stock ownership plan (ESOP). The tax benefit results from the deduction by the entity on its tax return for an award of stock that exceeds the cumulative compensation cost for common stock or preferred stock recognized for financial reporting. Includes any resulting tax benefit that exceeds the previously recognized deferred tax asset (excess tax benefits). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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X | ||||||||||
- Definition
Number of shares issued and outstanding as of the balance sheet date. No definition available.
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- Definition
Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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X | ||||||||||
- Definition
Number of new stock issued during the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Number of shares (or other type of equity) issued during the period as a result of any equity-based compensation plan other than an employee stock ownership plan (ESOP), net of any shares forfeited. Shares issued could result from the issuance of restricted stock, the exercise of stock options, stock issued under employee stock purchase plans, and/or other employee benefit plans. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Number of treasury shares (units) reissued during the period, excluding reissuance of shares (units) held in treasury used to satisfy equity-based compensation obligations exercised by the holders of such rights. Upon reissuance of shares (units) from treasury, either the common or preferred stock (unit) reissued is outstanding. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Equity impact of the value of new stock issued during the period. Includes shares issued in an initial public offering or a secondary public offering. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Value of stock (or other type of equity) issued during the period as a result of any equity-based compensation plan other than an employee stock ownership plan (ESOP), net of stock value of such awards forfeited. Stock issued could result from the issuance of restricted stock, the exercise of stock options, stock issued under employee stock purchase plans, and/or other employee benefit plans. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Equity impact of the value of treasury stock (units) reissued during the period, excluding reissuance of shares (units) held in treasury used to satisfy equity-based compensation obligations exercised by the holders of such rights. Upon reissuance of shares (units) from treasury, either the common or preferred stock (unit) reissued is outstanding. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Number of stock bought back by the entity at the exercise price or redemption price. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition
Equity impact of the value of stock bought back by the entity at the exercise price or redemption price. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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X | ||||||||||
- Definition
Decreases in restricted cash No definition available.
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- Definition
Distributions from unconsolidated joint ventures No definition available.
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X | ||||||||||
- Definition
Equity in (income) loss of unconsolidated joint ventures No definition available.
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X | ||||||||||
- Definition
Increases in restricted cash No definition available.
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- Definition
Inventory impairments and option contract abandonments No definition available.
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X | ||||||||||
- Definition
Proceeds from issuance of TEU prepaid stock purchase contracts No definition available.
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- Details
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X | ||||||||||
- Definition
The increase (decrease) during the reporting period in cash and cash equivalents. While for technical reasons this element has no balance attribute, the default assumption is a debit balance consistent with its label. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Cash includes currency on hand as well as demand deposits with banks or financial institutions. It also includes other kinds of accounts that have the general characteristics of demand deposits in that the customer may deposit additional funds at any time and effectively may withdraw funds at any time without prior notice or penalty. Cash equivalents, excluding items classified as marketable securities, include short-term, highly liquid Investments that are both readily convertible to known amounts of cash, and so near their maturity that they present minimal risk of changes in value because of changes in interest rates. Generally, only investments with original maturities of three months or less qualify under that definition. Original maturity means original maturity to the entity holding the investment. For example, both a three-month US Treasury bill and a three-year Treasury note purchased three months from maturity qualify as cash equivalents. However, a Treasury note purchased three years ago does not become a cash equivalent when its remaining maturity is three months. Short-term investments, exclusive of cash equivalents, generally consist of marketable securities intended to be sold within one year (or the normal operating cycle if longer) and may include trading securities, available-for-sale securities, or held-to-maturity securities (if maturing within one year), as applicable. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The component of income tax expense for the period representing the increase (decrease) in the entity's deferred tax assets and liabilities pertaining to continuing operations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The aggregate net amount of depreciation, amortization, and accretion recognized during an accounting period. As a noncash item, the net amount is added back to net income when calculating cash provided by or used in operations using the indirect method. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
This item represents disclosure of the amount of dividends or other distributions received from unconsolidated subsidiaries, certain corporate joint ventures, and certain noncontrolled corporation; these investments are accounted for under the equity method of accounting. This element excludes distributions that constitute a return of investment, which are classified as investing activities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Reductions in the entity's income taxes that arise when compensation cost (from non-qualified share-based compensation) recognized on the entity's tax return exceeds compensation cost from equity-based compensation recognized in financial statements. This element represents the cash inflow reported in the enterprise's financing activities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Reductions in the entity's income taxes that arise when compensation cost (from non-qualified equity-based compensation) recognized on the entity's tax return exceeds compensation cost from equity-based compensation recognized in financial statements. This element reduces net cash provided by operating activities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Loss recognized during the period that results from the write-down of goodwill after comparing the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. Goodwill is assessed at least annually for impairment. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The amount of impairment loss recognized in the period resulting from the write-down of the carrying amount of a finite-lived intangible asset to fair value. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The increase (decrease) during the reporting period in the amount due from customers for the credit sale of goods and services; includes accounts receivable and other types of receivables. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Change in recurring obligations of a business that arise from the acquisition of merchandise, materials, supplies and services used in the production and sale of goods and services. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The increase (decrease) during the reporting period in income taxes receivable, which represents the amount due from tax authorities for refunds of overpayments or recoveries of income taxes paid. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The increase (decrease) during the reporting period in the aggregate value of all inventory held by the reporting entity, associated with underlying transactions that are classified as operating activities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Details
|
X | ||||||||||
- Definition
The increase (decrease) during the reporting period in other assets used in operating activities not separately disclosed in the statement of cash flows. May include changes in other current assets, other noncurrent assets, or a combination of other current and noncurrent assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The increase (decrease) during the reporting period in other liabilities used in operating activities not separately disclosed in the statement of cash flows. May include changes in other current liabilities, other noncurrent liabilities, or a combination of other current and noncurrent liabilities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The net cash inflow or outflow from financing activity for the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Details
|
X | ||||||||||
- Definition
The net cash inflow or outflow from investing activity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Details
|
X | ||||||||||
- Definition
The net cash from (used in) all of the entity's operating activities, including those of discontinued operations, of the reporting entity. Operating activities generally involve producing and delivering goods and providing services. Operating activity cash flows include transactions, adjustments, and changes in value that are not defined as investing or financing activities. While for technical reasons this element has no balance attribute, the default assumption is a debit balance consistent with its label. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Details
|
X | ||||||||||
- Definition
The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Other cash or noncash adjustments to reconcile net income to cash provided by (used in) operating activities that are not separately disclosed in the statement of cash flows (for example, cash received or cash paid during the current period for miscellaneous operating activities, net change during the reporting period in other assets or other liabilities). No definition available.
|
X | ||||||||||
- Definition
The cash outflow to reacquire common stock during the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The cash outflow paid to third parties in connection with debt origination, which will be amortized over the remaining maturity period of the associated long-term debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The cash outflow associated with the purchase of or advances to an equity method investments, which are investments in joint ventures and entities in which the entity has an equity ownership interest normally of 20 to 50 percent and exercises significant influence. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The cash outflow associated with the acquisition of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale; includes cash outflows to pay for construction of self-constructed assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The cash inflow from the additional capital contribution to the entity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The cash inflow during the period from additional borrowings in aggregate debt. Includes proceeds from short-term and long-term debt. No definition available.
|
X | ||||||||||
- Definition
The cash inflow from amounts received from issuance of long-term debt that is wholly or partially secured by collateral. Excludes proceeds from tax exempt secured debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Amount of the current period expense charged against operations, the offset which is generally to the allowance for doubtful accounts for the purpose of reducing receivables, including notes receivable, to an amount that approximates their net realizable value (the amount expected to be collected). Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
The cash outflow during the period from the repayment of aggregate short-term and long-term debt. Excludes payment of capital lease obligations. No definition available.
|
X | ||||||||||
- Definition
The aggregate amount of noncash, equity-based employee remuneration. This may include the value of stock or unit options, amortization of restricted stock or units, and adjustment for officers' compensation. As noncash, this element is an add back when calculating net cash generated by operating activities using the indirect method. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
X | ||||||||||
- Definition
Write-off of amounts previously capitalized as debt issuance cost in an extinguishment of debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
|
Summary of Significant Accounting Policies
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Summary of Significant Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies |
Organization. Beazer Homes USA, Inc. is one of
the ten largest homebuilders in the United States, based on
number of homes closed. We are a geographically diversified
homebuilder with active operations in 16 states: Arizona,
California, Delaware, Florida, Georgia, Indiana, Maryland,
Nevada, New Jersey, New York, North Carolina, Pennsylvania,
South Carolina, Tennessee, Texas, and Virginia. Through
September 30, 2010, we offered title insurance services to
our homebuyers in many of our markets. Effective
September 30, 2010 we exited the title services business.
Over the past few years, we have discontinued homebuilding
operations in certain of our markets. Results from our title
services business and exit markets are reported as discontinued
operations in the accompanying Consolidated Statements of
Operations for all periods presented (see Note 15 for
further discussion of our Discontinued Operations). We evaluated
events that occurred after the balance sheet date but before the
financial statements were issued or are available to be issued
for accounting treatment and disclosure.
Presentation. The accompanying consolidated
financial statements include the accounts of Beazer Homes USA,
Inc. and our subsidiaries. Intercompany balances have been
eliminated in consolidation. Certain items in prior period
financial statements have been reclassified to conform to the
current presentation.
Cash and Cash Equivalents and Restricted
Cash. We consider investments with maturities of
three months or less when purchased to be cash equivalents. At
September 30, 2011, the majority of our cash and cash
equivalents were invested in high-quality money market mutual
funds, highly marketable securities, or on deposit with major
banks, which were valued at par with no withdrawal restrictions.
The underlying investments of these funds were predominately
U.S. Government and U.S. Government Agency
obligations. Restricted cash includes cash restricted by state
law or a contractual requirement and, as of September 30,
2011 relates primarily to cash collateral for our cash secured
term loan and outstanding letters of credit.
Accounts Receivable. Accounts receivable
primarily consist of escrow deposits to be received from title
companies associated with closed homes. Generally, we receive
cash from title companies within a few days of the home being
closed.
Inventory. Owned inventory consists solely of
residential real estate developments. Interest, real estate
taxes and development costs are capitalized in inventory during
the development and construction period. Construction and land
costs are comprised of direct and allocated costs, including
estimated future costs for warranties and amenities. Land, land
improvements and other common costs are typically allocated to
individual residential lots on a pro-rata basis, and the costs
of residential lots are transferred to construction in progress
when home construction begins. Consolidated inventory not owned
represents the fair value of land under option agreements of a
variable interest entity (VIE) where the Company is deemed to be
the primary beneficiary of the VIE. VIEs are entities in which
1) equity investors do not have a controlling financial
interest
and/or
2) the entity is unable to finance its activities without
additional subordinated financial support from other parties. In
addition, when our deposits and pre-acquisition development
costs exceed certain thresholds, we record the remaining
purchase price of the lots as consolidated inventory not owned
and obligations related to consolidated inventory not owned in
the Consolidated Balance Sheets.
Inventory Valuation — Held for
Development. Our homebuilding inventories that
are accounted for as held for development include land and home
construction assets grouped together as communities.
Homebuilding inventories held for development are stated at cost
(including direct construction costs, capitalized indirect
costs, capitalized interest and real estate taxes) unless facts
and circumstances indicate that the carrying value of the assets
may not be recoverable. We assess these assets no less than
quarterly for recoverability. Generally, upon the commencement
of land development activities, it may take three to five years
(depending on, among other things, the size of the community and
its sales pace) to fully develop, sell, construct and close all
the homes in a typical community. However, the impact of the
recent downturn in our business has significantly lengthened the
estimated life of many communities. Recoverability of assets is
measured by comparing the carrying amount of an asset to future
undiscounted cash flows expected to be generated by the asset.
If the expected undiscounted cash flows generated are expected
to be less than its carrying amount, an impairment charge should
be recorded to write down the carrying amount of such asset to
its estimated fair value based on discounted cash flows.
When conducting our community level review for the
recoverability of our homebuilding inventories held for
development, we establish a quarterly “watch list” of
communities with more than 10 homes remaining that carry profit
margins in backlog and in our forecast that are below a minimum
threshold of profitability. In our experience, this threshold
represents a level of profitability that may be an indicator of
conditions which would require an asset impairment but does not
guarantee that such impairment will definitively be appropriate.
As such, assets on the quarterly watch list are subject to
substantial additional financial and operational analyses and
review that consider the competitive environment and other
factors contributing to profit margins below our watch list
threshold. For communities where the current competitive and
market dynamics indicate that these factors may be other than
temporary, which may call into question the recoverability of
our investment, a formal impairment analysis is performed. The
formal impairment analysis consists of both qualitative
competitive market analyses and a quantitative analysis
reflecting market and asset specific information.
Our qualitative competitive market analyses include site visits
to competitor new home communities and written community level
competitive assessments. A competitive assessment consists of a
comparison of our specific community with its competitor
communities, considering square footage of homes offered,
amenities offered within the homes and the communities,
location, transportation availability and school districts,
among many factors. In addition, we review the pace of monthly
home sales of our competitor communities in relation to our
specific community. We also review other factors such as the
target buyer and the macro-economic characteristics that impact
the performance of our assets, such as unemployment and the
availability of mortgage financing, among other things. Based on
this qualitative competitive market analysis, adjustments to our
sales prices may be required in order to make our communities
competitive. We incorporate these adjusted prices in our
quantitative analysis for the specific community.
The quantitative analysis compares the projected future
undiscounted cash flows for each such community with its current
carrying value. This undiscounted cash flow analysis requires
important assumptions regarding the location and mix of house
plans to be sold, current and future home sale prices and
incentives for each plan, current and future construction costs
for each plan, and the pace of monthly sales to occur today and
into the future.
There is uncertainty associated with preparing the undiscounted
cash flow analysis because future market conditions will almost
certainly be different, either better or worse, than current
conditions. The single most important “input” to the
cash flow analysis is current and future home sales prices for a
specific community. The risk of over or under-stating any of the
important cash flow variables, including home prices, is greater
with longer-lived communities and within markets that have
historically experienced greater home price volatility. In an
effort to address these risks, we consider some home price and
construction cost appreciation in future years for certain
communities that are expected to be selling for more than three
years and/or
if the market has typically exhibited high levels of price
volatility. Absent these assumptions on cost and sales price
appreciation, we believe the long-term cash flow analysis would
be unrealistic and would serve to artificially improve future
profitability. Finally, we also ensure that the monthly sales
absorptions, including historical seasonal differences of our
communities and those of our competitors, used in our
undiscounted cash flow analyses are realistic, consider our
development schedules and relate to those achieved by our
competitors for the specific communities.
If the aggregate undiscounted cash flows from our quantitative
analysis are in excess of the carrying value, the asset is
considered to be recoverable and is not impaired. If the
aggregate undiscounted cash flows are less than the carrying or
book value, we perform a discounted cash flow analysis to
determine the fair value of the community. The fair value of the
community is estimated using the present value of the estimated
future cash flows using discount rates commensurate with the
risk associated with the underlying community assets. The
discount rate used may be different for each community. The
factors considered when determining an appropriate discount rate
for a community include, among others: (1) community
specific factors such as the number of lots in the community,
the status of land development in the community, the competitive
factors influencing the sales performance of the community and
(2) overall market factors such as employment levels,
consumer confidence and the existing supply of new and used
homes for sale. If the determined fair value is less than the
carrying value of the specific asset, the asset is considered
not recoverable and is written down to its fair value plus the
asset’s share of capitalized
unallocated interest and other costs. The carrying value of
assets in communities that were previously impaired and continue
to be classified as held for development is not increased for
future estimates of increases in fair value in future reporting
periods. Due to uncertainties in the estimation process,
particularly with respect to projected home sales prices and
absorption rates, the timing and amount of the estimated future
cash flows and discount rates, it is reasonably possible that
actual results could differ from the estimates used in our
impairment analyses.
Asset Valuation — Land Held for Future
Development. For those communities for which
construction and development activities are expected to occur in
the future or have been idled (land held for future
development), all applicable interest and real estate taxes are
expensed as incurred and the inventory is stated at cost unless
facts and circumstances indicate that the carrying value of the
assets may not be recoverable. The future enactment of a
development plan or the occurrence of events and circumstances
may indicate that the carrying amount of an asset may not be
recoverable. We evaluate the potential development plans of each
community in land held for future development if changes in
facts and circumstances occur which would give rise to a more
detailed analysis for a change in the status of a community to
active status or held for development.
Asset Valuation — Land Held for
Sale. We record assets held for sale at the lower
of the carrying value or fair value less costs to sell. The
following criteria are used to determine if land is held for
sale:
Additionally, in certain circumstances, management will
re-evaluate the best use of an asset that is currently being
accounted for as held for development. In such instances,
management will review, among other things, the current and
projected competitive circumstances of the community, including
the level of supply of new and used inventory, the level of
sales absorptions by us and our competition, the level of sales
incentives required and the number of owned lots remaining in
the community. If, based on this review and the foregoing
criteria have been met at the end of the applicable reporting
period, we believe that the best use of the asset is the sale of
all or a portion of the asset in its current condition, then all
or portions of the community are accounted for as held for sale.
In determining the fair value of the assets less cost to sell,
we consider factors including current sales prices for
comparable assets in the area, recent market analysis studies,
appraisals, any recent legitimate offers, and listing prices of
similar properties. If the estimated fair value less cost to
sell of an asset is less than its current carrying value, the
asset is written down to its estimated fair value less cost to
sell. Due to uncertainties in the estimation process, it is
reasonably possible that actual results could differ from the
estimates used in our historical analyses.
Land Not Owned Under Option Agreements. In
addition to purchasing land directly, we utilize lot option
agreements which generally enable us to defer acquiring portions
of properties owned by third parties and unconsolidated entities
until we have determined whether to exercise our lot option. A
majority of our lot option contracts require a non-refundable
cash deposit or irrevocable letter of credit based on a
percentage of the purchase price of the land for the right to
acquire lots during a specified period of time at a certain
price. Under lot option contracts, purchase of the properties is
contingent upon satisfaction of certain requirements by us and
the sellers. Under lot option contracts our liability is
generally limited to forfeiture of the non-refundable deposits,
letters of credit and other non-refundable amounts incurred.
In accordance with generally accepted accounting principles in
the United States of America (GAAP), if the entity holding the
land under option is a VIE, the Company’s deposit
represents a variable interest in that entity. To determine
whether we are the primary beneficiary of the VIE, we are first
required to evaluate whether we have the ability to control the
activities of the VIE that most significantly impact its
economic performance. Such activities
include, but are not limited to, the ability to determine the
budget and scope of land development work, if any; the ability
to control financing decisions for the VIE; the ability to
acquire additional land into the VIE or dispose of land in the
VIE not under contract with Beazer; and the ability to change or
amend the existing option contract with the VIE. If we are not
determined to control such activities, we are not considered the
primary beneficiary of the VIE and thus do not consolidate the
VIE. If we do have the ability to control such activities, we
will continue our analysis by determining if we are expected to
absorb a potentially significant amount of the VIE’s losses
or, if no party absorbs the majority of such losses, if we will
benefit from potentially a significant amount of the VIE’s
expected gains.
If we are the primary beneficiary of the VIE, we will
consolidate the VIE and reflect such assets and liabilities as
land not owned under option agreements in our balance sheets,
though creditors of the VIE have no recourse against the
Company. For VIEs we are required to consolidate, we record the
remaining contractual purchase price under the applicable lot
option agreement to land not owned under option agreements with
an offsetting increase to obligations related to land not owned
under option agreements. In recent years, the Company has
canceled a significant number of lot option agreements, which
has resulted in significant write-offs of the related deposits
and pre-acquisition costs but has not exposed the Company to the
overall risks or losses of the applicable VIEs.
Investments in Unconsolidated Joint
Ventures. We participate in a number of land
development joint ventures in which we have less than a
controlling interest. Our joint ventures are typically entered
into with unrelated developers, other homebuilders and financial
partners to develop finished lots for sale to the joint
venture’s members and other third parties. We have
determined that our interest in these joint ventures should be
accounted for under the equity method. We recognize our share of
profits from the sale of lots to other buyers. Our share of
profits from lots we purchase from the joint ventures is
deferred and treated as a reduction of the cost of the land
purchased from the joint venture. Such profits are subsequently
recognized at the time the home closes and title passes to the
homebuyer. We evaluate our investments in unconsolidated
entities for impairment during each reporting period in
accordance with ASC 323, Investments — Equity
Method and Joint Ventures. A series of operating losses of
an investee or other factors may indicate that a decrease in the
value of our investment in the unconsolidated entity has
occurred which is
other-than-temporary.
The amount of impairment recognized is the excess of the
investment’s carrying value over its estimated fair value.
Our joint ventures typically obtain secured acquisition and
development financing. See Note 3, Investments in
Unconsolidated Joint Ventures.
Property, Plant and Equipment. Property, plant
and equipment is recorded at cost. Depreciation is computed on a
straight-line basis at rates based on estimated useful lives as
follows:
Goodwill. Goodwill represents the excess of
the purchase price over the fair value of assets acquired. From
late fiscal 2006 through the first half of fiscal 2009, the
deterioration of the housing industry resulted in an oversupply
of inventory, reduced levels of demand, increased cancellation
rates, aggressive price competition and increased incentives for
homes sales. Based on our impairment tests and consideration of
the current and expected future market conditions, over this
time we determined that all of our goodwill was impaired. We
recorded a non-cash, pre-tax goodwill impairment of
$16.1 million in fiscal 2009. The Company has no goodwill
remaining as of September 30, 2011.
Other Assets. Other assets principally include
prepaid expenses, debt issuance costs and deferred compensation
plan assets.
Income Taxes. The provision for income taxes
is comprised of taxes that are currently payable and deferred
taxes that relate to temporary differences between financial
reporting carrying values and tax bases of assets and
liabilities. Deferred tax assets and liabilities result from
deductible or taxable amounts in future years when such assets
and liabilities are recovered or settled and are measured using
the enacted tax rates and laws that are expected to be in effect
when the assets and liabilities are recovered or settled. We
include any estimated interest and penalties on tax related
matters in income taxes payable. We recognize the effect of
income tax positions only if those positions are more likely
than not of being sustained. Recognized income tax positions are
measured at the largest amount that is greater than 50% likely
of being realized. Changes in recognition of measurement are
recorded in the period in which the change in judgment occurs.
We record interest and penalties related to unrecognized tax
benefits in income tax expense.
Other Liabilities. Other liabilities include
the following:
Income Recognition and Classification of
Costs. Revenue and related profit are generally
recognized at the time of the closing of a sale, when title to
and possession of the property are transferred to the buyer. As
appropriate, revenue for condominiums under construction is
recognized based on the
percentage-of-completion
method, when certain criteria are met.
Sales discounts and incentives include items such as cash
discounts, discounts on options included in the home, option
upgrades (such as upgrades for cabinetry, countertops and
flooring), and seller-paid financing or closing costs. In
addition, from time to time, we may also provide homebuyers with
retail gift certificates
and/or other
nominal retail merchandise. All sales incentives other than cash
discounts are recognized as a cost of selling the home and are
included in home construction and land sales expenses. Cash
discounts are accounted for as a reduction in the sales price of
the home.
Estimated future warranty costs are charged to cost of sales in
the period when the revenues from home closings are recognized.
Such estimated warranty costs generally range from 0.5% to 2.0%
of total revenue. Additional warranty costs are charged to cost
of sales as necessary based on management’s estimate of the
costs to remediate existing claims. See Note 13 for a more
detailed discussion of warranty costs and related reserves.
Advertising costs related to our continuing operations of
$11.4 million, $11.2 million and $11.7 million
for fiscal years 2011, 2010, and 2009, respectively, were
expensed as incurred and are included in general and
administrative expenses.
Earnings Per Share (EPS). The computation of
basic earnings per common share is determined by dividing net
income applicable to common stockholders by the weighted average
number of common shares outstanding during the period. Diluted
EPS additionally gives effect (when dilutive) to stock options,
other stock based awards and other potentially dilutive
securities including the common shares issuable upon conversion
of our Mandatory
Convertible Subordinated Notes and Tangible Equity Unit prepaid
stock purchase contracts. In computing diluted loss per share
for the fiscal years ended September 30, 2011, 2010, and
2009, all common stock equivalents were excluded from the
computation of diluted loss per share as a result of their
anti-dilutive effect, including options/SSARs to purchase
1.9 million shares of common stock and 12.5 million
and 12.9 million shares issuable upon the conversion of our
Mandatory Convertible Notes and our TEU prepaid stock purchase
contracts (based on the maximum potential shares upon
conversion), respectively. See notes 7, 11 and 12 for
further discussion of these common stock equivalents.
Fair Value Measurements. Certain of our assets
are required to be recorded at fair value on a non-recurring
basis when events and circumstances indicate that the carrying
value may not be recovered. We review our long-lived assets,
including inventory for recoverability when factors that
indicate an impairment may exist, but no less than quarterly.
Fair value is based on estimated cash flows discounted for
market risks associated with the long-lived assets. The fair
value of certain of our financial instruments approximate their
carrying amounts due to the short maturity of these assets and
liabilities or the variable interest rates on such obligations.
The fair value of our publicly held debt is generally estimated
based on quoted bid prices for these instruments. Certain of our
other financial instruments are estimated by discounting
scheduled cash flows through maturity or using market rates
currently being offered on loans with similar terms and credit
quality. See Notes 4 and 8 for additional discussion of our
fair value measurements.
Stock-Based Compensation. We use the
Black-Scholes model to value stock-settled appreciation rights
(SSARs) and stock option grants. We estimate forfeitures in
calculating the expense related to stock-based compensation. In
addition, we reflect the benefits of tax deductions in excess of
recognized compensation cost as a financing cash inflow and an
operating cash outflow. Nonvested stock granted to employees is
valued based on the market price of the common stock on the date
of the grant. Performance based, nonvested stock granted to
employees is valued using the Monte Carlo valuation method.
Cash-settled, stock-based awards if, and when, granted to
employees are initially valued based on the market price of the
underlying common stock on the date of the grant and are
adjusted to fair value until vested. Stock options issued to
non-employees are valued using the Black-Scholes option pricing
model. Nonvested stock granted to non-employees is initially
valued based on the market price of the common stock on the date
of the grant and is adjusted to fair value until vested.
Compensation cost arising from nonvested stock granted to
employees, from cash-settled, stock-based employee awards and
from non-employee stock awards is recognized as expense using
the straight-line method over the vesting period. Although the
Company may, from time to time grant cash-settled awards to
employees, for the fiscal years ended and as of
September 30, 2011, 2010 and 2009, there were no such
awards either granted or outstanding.
Unearned compensation is included in paid in capital. As of
September 30, 2011 and 2010, there was $4.0 million
and $10.0 million, respectively, of total unrecognized
compensation cost related to nonvested stock. The cost remaining
at September 30, 2011 is expected to be recognized over a
weighted average period of 1.8 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 assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
Recently Adopted Accounting Pronouncements. In
February 2007, the FASB issued SFAS 159, The Fair Value
Option for Financial Assets and Financial
Liabilities — Including an amendment of FASB Statement
No. 115 (ASC 825). SFAS 159 (ASC 825) permits
companies to measure certain financial instruments and other
items at fair value. We have not elected the fair value option
applicable under SFAS 159 (ASC 825).
In May 2008, the FASB issued FSP APB
14-1,
Accounting for Convertible Debt Instruments That May Be
Settled in Cash Upon Conversion (Including Partial Cash
Settlement) (ASC 470). FSP APB
14-1 (ASC
470) applies to convertible debt instruments that have a
“net settlement feature” permitting settlement
partially or fully in cash upon conversion. FSP APB
14-1 (ASC
470) was effective for the Company beginning
October 1, 2009. Due to the fact that the Company’s
convertible securities cannot be settled in cash upon
conversion, the adoption of
FSP APB 14-1 (ASC 470) did
not have a material impact on our consolidated financial
condition and results of operations.
In June 2009, the FASB revised its guidance regarding the
determination of a primary beneficiary of a VIE. We adopted the
revised provisions of ASC 810 on October 1, 2010. The
amendments to ASC 810 replace the prior quantitative
computations for determining which entity, if any, is the
primary beneficiary of the VIE. The revision also increased the
disclosures required about a reporting entity’s involvement
with VIEs. Under these revised provisions, we determined that,
for certain VIEs, we do not control the activities of the VIE
that most significantly impact its economic performance and,
therefore, we are not the primary beneficiary of the VIE. In
addition, we reviewed our non-VIE lot option agreements pursuant
to
ASC 470-40,
Product Financing Arrangements. As a result, as of
October 1, 2010, we deconsolidated land under four lot
option agreements which reduced Land Not Owned Under Option
Agreements and Obligations Related to Land Not Owned Under
Options Agreements by $12.9 million.
Recent Accounting Pronouncements Not Yet
Adopted. In May 2011, the Financial Accounting
Standard Board (“FASB”) issued ASU
2011-04,
Fair Value Measurement (Topic 820): Amendments to Achieve
Common Fair Value Measurement and Disclosure Requirements in
U.S. GAAP and IFRSs. ASU
2011-04
clarifies some existing concepts, eliminates wording differences
between U.S. GAAP and International Financial Reporting
Standards (IFRS), and in some limited cases, changes some
principles to achieve convergence between U.S. GAAP and
IFRS. ASU
2011-04
results in a consistent definition of fair value and common
requirements for measurement of and disclosure about fair value
between U.S. GAAP and IFRS. ASU
2011-04 also
expands the disclosures for fair value measurements that are
estimated using significant unobservable
(Level 3) inputs. ASU
2011-04 will
be effective for the Company beginning after December 15,
2011. The Company does not expect the adoption of ASU
2011-04 to
have a material effect on its operating results or financial
position.
In June 2011, the FASB issued ASU
2011-05,
Presentation of Comprehensive Income, which requires an
entity to present the total of comprehensive income, the
components of net income, and the components of other
comprehensive income either in a single continuous statement of
comprehensive income, or in two separate but consecutive
statements. ASU
2011-05
eliminates the option to present components of other
comprehensive income as part of the statement of equity. ASU
2011-05 will
be effective for the Company beginning after December 15,
2011. The Company does not expect the adoption of ASU
2011-05 to
have a material effect on its operating results or financial
position.
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The entire disclosure for the organization, consolidation and basis of presentation of financial statements disclosure, and significant accounting policies of the reporting entity. May be provided in more than one note to the financial statements, as long as users are provided with an understanding of (1) the significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement with a VIE, (2) the nature of restrictions on a consolidated VIE's assets reported by an enterprise in its statement of financial position, including the carrying amounts of such assets, (3) the nature of, and changes in, the risks associated with an enterprise's involvement with the VIE, and (4) how an enterprise's involvement with the VIE affects the enterprise's financial position, financial performance, and cash flows. Describes procedure if disclosures are provided in more than one note to the financial statements. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Supplemental Cash Flow Information
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Supplemental Cash Flow Information |
We had the following cash and non-cash activity (in
thousands):
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The entire disclosure for supplemental cash flow activities, including cash, noncash, and part noncash transactions, for the period. Noncash is defined as information about all investing and financing activities of an enterprise during a period that affect recognized assets or liabilities but that do not result in cash receipts or cash payments in the period. "Part noncash" refers to that portion of the transaction not resulting in cash receipts or cash payments in the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Investments in Unconsolidated Joint Ventures
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Investments in Unconsolidated Joint Ventures |
As of September 30, 2011, we participated in certain land
development joint ventures in which Beazer Homes had less than a
controlling interest. The following table presents our
investment in our unconsolidated joint
ventures, the total equity and outstanding borrowings of these
joint ventures and our guarantees of these borrowings as of
September 30, 2011 and September 30, 2010 (in
thousands):
The increase in our investment in unconsolidated joint ventures
from September 30, 2010 to September 30, 2011 relates
primarily to additional investments of $1.9 million offset
by distributions of earnings in cash and lots totaling
$1.2 million. For the fiscal years ended September 30,
2011, 2010 and 2009, our loss from joint venture activities, the
impairments of our investments in certain of our unconsolidated
joint ventures, and the overall equity in loss of unconsolidated
joint ventures is as follows:
The aggregate debt of the unconsolidated joint ventures was
$394.4 million and $394.3 million at
September 30, 2011 and 2010, respectively. At
September 30, 2011, total borrowings outstanding include
$327.9 million related to our interest in South Edge.
South
Edge
During fiscal 2008, the administrative agent for the lenders to
our South Edge joint venture notified the joint venture members
that it believed the joint venture was in default of certain
joint venture loan agreements, in particular, the failure of the
joint venture members to acquire and pay for specified parcels
of land, resulting in a payment default. In December 2008, the
lenders filed lawsuits against some of the joint venture members
and certain of those members’ parent companies (including
the Company), seeking to recover damages under completion
guarantees, among other claims. Based on the Company’s
revised estimates regarding the value of our investment, the
Company impaired its equity interest of $8.8 million in
this joint venture during the second quarter of fiscal 2010. In
addition, one member of the joint venture filed an arbitration
proceeding against the remaining members related to the
plaintiff-member’s allegations that the other members
failed to perform under the applicable joint venture agreements.
The arbitration panel issued its decision on July 6, 2010
and awarded the plaintiff-member a monetary award against the
remaining members. At that time, the Company recorded an accrual
for such matter.
On December 9, 2010, three lenders filed an involuntary
bankruptcy petition against the South Edge joint venture. On
February 3, 2011, the bankruptcy court granted this
petition and the motion for appointment of a Chapter 11
trustee. Effective June 10, 2011, the Company and certain
other joint venture members (the Participating Members) entered
into a settlement agreement with the administrative agent and
the three lenders. Under this agreement, the parties agreed to
develop a plan of reorganization for the joint venture. At the
same time, the
members, the administrative agent and the three lenders entered
into an agreement with the Chapter 11 Trustee, under which
the Trustee agreed to support the plan of reorganization. Based
on the terms of the agreement, the Company will pay the lenders
an amount between approximately $15.7 million and
$17.2 million in relation to the repayment guarantees.
Payments pursuant to the plan of reorganization would give each
payor lien rights to its share of the property currently owned
by the joint venture. The Company also agreed to make other
payments in connection with the bankruptcy proceeding. In
addition, the Company and the other Participating Members
reached a settlement, with the plaintiff- member, of the
arbitration claims and other claims relating to the joint
venture.
On October 26, 2011, the bankruptcy court approved a plan
of reorganization for South Edge that included approval of the
settlement agreement with the lenders and the settlement of the
arbitration award referred to above. The plan of reorganization
calls for the formation of a new joint venture called Inspirada,
LLC (Inspirada), with the Participating Members constituting the
members of the new venture. Inspirada will take title to the
South Edge assets including its real property and lien rights,
and the debt to the lenders will be extinguished upon payment by
the Inspirada members of their obligations under the plan of
reorganization. All pending litigation claims by the lenders and
the plaintiff-member against the Participating Members will be
dismissed as well. The Participating Members also acquired all
claims of the lender and South Edge against the
non-Participating Members. In addition to the payments to the
lenders, we, as a member of the Inspirada joint venture, will
have obligations for future infrastructure and other development
costs. At this time, these costs cannot be quantified due to,
among other things, uncertainty over the future development
configuration of the project and the related costs, market
conditions, uncertainty over the remaining infrastructure
deposits and previously filed bankruptcies of other joint
venture members.
As a result of these occurrences, during the fiscal 2011, we
accrued $17.2 million related to our estimated obligation
under the settlement agreement. In accordance with the final
agreement, we paid $1.5 million into an escrow fund in June
2011, reducing our outstanding liability at September 30,
2011 to approximately $15.7 million. As previously
discussed, the Company will ultimately obtain land in exchange
for satisfaction of our obligations under the plan of
reorganization. At the current time, there are uncertainties
with respect to the location and density of the land we would
receive, the products we would build on such land and the
estimated selling prices of such homes. Considering the various
potential scenarios and the current and expected market
conditions in the Las Vegas area, we determined that the value
of our future land purchase rights was approximately
$11.7 million as of September 30, 2011 and recognized
non-cash pre-tax impairments totaling $5.6 million on such
future land purchase rights during the fiscal 2011. We have
recorded $11.7 million to Other Assets as of
September 30, 2011 representing our future land purchase
rights from the ultimate payment of this repayment guarantee.
Because there are uncertainties with respect to the value of the
lien rights or title to our share of the underlying property, we
may be required to record adjustments to the carrying value of
these recognized Other Assets in future periods as better
information becomes available.
Guarantees
Our joint ventures typically obtain secured acquisition,
development and construction financing. Generally Beazer and our
joint venture partners provide varying levels of guarantees of
debt and other obligations for our unconsolidated joint
ventures. At September 30, 2011, these guarantees included,
for certain joint ventures, construction completion guarantees,
repayment guarantees and environmental indemnities.
As of September 30, 2011, we have a completion guarantee
related to one joint venture loan which also has a repayment
guarantee associated with it. With respect to this guaranty, we
and our joint venture partners may be obligated to the project
lenders to complete land development improvements and the
construction of planned homes if the joint venture does not
perform the required development. In addition, we and our joint
venture partners have repayment guarantees related to certain
joint ventures’ borrowings. These repayment guarantees
require the repayment of all or a portion of the debt of the
unconsolidated joint venture only in the event the joint venture
defaults on its obligations under the borrowing or in some cases
only in the event the joint venture files for bankruptcy. Our
estimate of Beazer’s maximum exposure to our repayment
guarantees related to the outstanding
debt of its unconsolidated joint ventures was $17.9 million
and $15.8 million at September 30, 2011 and 2010,
respectively. As of September 30, 2011, $16.4 million
has been recorded in Other Liabilities related to our repayment
guarantees, which is net of the $1.5 million we paid in
fiscal 2011 related to our South Edge joint venture. We and our
joint venture partners also generally provide unsecured
environmental indemnities to joint venture project lenders. In
each case, we have performed due diligence on potential
environmental risks. These indemnities obligate us to reimburse
the project lenders for claims related to environmental matters
for which they are held responsible. During the fiscal years
ended September 30, 2011 and 2010, we were not required to
make any payments related to environmental indemnities.
In assessing the need to record a liability for the contingent
aspect of these guarantees, we consider our historical
experience in being required to perform under the guarantees,
the fair value of the collateral underlying these guarantees and
the financial condition of the applicable unconsolidated joint
ventures. In addition, we monitor the fair value of the
collateral of these unconsolidated joint ventures to ensure that
the related borrowings do not exceed the specified percentage of
the value of the property securing the borrowings. We have
recorded a liability for guarantees we determined were probable
and reasonably estimable, but we have not recorded a liability
for the contingent aspects of any guarantees that we determined
were reasonably possible but not probable.
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The entire disclosure for equity investment, or group of investments, for which combined disclosure is appropriate, including: (a) the name of each investee and percentage of ownership of common stock, (b) accounting policies for investments in common stock, (c) difference between the amount at which the investment is carried and the amount of underlying equity in net assets and the accounting treatment of the difference, (d) the total fair value of each identified investment for which a market value is available, (e) summarized information as to assets, liabilities, and results of operations of the investees (for investments in unconsolidated subsidiaries, common stock of joint ventures, or other investments using the equity method), and (f) material effects of possible conversions, exercises, or contingent issuances of the investee. Other disclosures include (a) the names of any investee in which the investor owns 20 percent or more of the voting stock and investment is not accounted for using the equity method, and the reasons why not, and (b) the names of any investee in which the investor owns less than 20 percent of the voting stock and the investment is accounted for using the equity method, and the reasons why it is. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Inventory [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory |
Homes under construction includes homes finished and ready for
delivery and homes in various stages of construction. We had 334
($59.3 million) and 423 ($71.5 million) substantially
completed homes that were not subject to a sales contract (spec
homes) at September 30, 2011 and 2010, respectively.
Development projects in progress consist principally of land and
land improvement costs. Certain of the fully developed lots in
this category are reserved by a deposit or sales contract. Land
held for future development consists of communities for which
construction and development activities are expected to occur in
the future or have been idled and are stated at cost unless
facts and circumstances indicate that the carrying value of the
assets may not be recoverable. All applicable interest and real
estate taxes on land held for future development are expensed as
incurred. Land held for sale as of September 30, 2011
principally included land held for sale in the markets we have
decided to exit including Denver, Colorado, Charlotte, North
Carolina, and Jacksonville, Florida.
The value related to previously owned homes acquired by our
Pre-Owned Homes Division is reported as property, plant and
equipment, excluded from the inventory information provided, and
depreciated over the asset’s estimated remaining useful
life. These homes are within select communities in markets in
which the Company currently operates and will be repaired,
rented to consumers and eventually resold.
Total owned inventory, by reportable segment, is set forth in
the table below (in thousands):
Inventory located in California, the state with our largest
concentration of inventory, was $367.8 million and
$345.7 million at September 30, 2011 and 2010,
respectively.
Inventory Impairments. In our fiscal 2011
analyses, we have assumed limited market improvements in some
communities beginning in fiscal 2013 and continuing improvement
in these communities in subsequent years. For any communities
scheduled to close out in fiscal 2012, we did not assume any
market improvements. The discount rate used may be different for
each community and ranged from 12.6% to 18.2% for the
communities analyzed in the fiscal year ended September 30,
2011 from 13.7% to 19.8% for the fiscal year ended
September 30, 2010 and 17.0% to 22.4% for the fiscal year
ended September 30, 2009. The following tables represent
the results, by reportable segment of our community level review
of the recoverability of our inventory assets held for
development as of September 30, 2011 and 2010 ($ in
thousands). We have elected to aggregate our disclosure at
the reportable segment level because we believe this level of
disclosure is most meaningful to the readers of our financial
statements. As previously discussed, communities included on our
“watch list” typically carry profit margins in backlog
and in our forecast that are below a minimum threshold of
profitability. The aggregate
undiscounted cash flow fair value as a percentage of book value
for the communities represented below is consistent with our
expectations given our “watch list” methodology.
The table below summarizes the results of our discounted cash
flow analysis for the years ended September 30, 2011, 2010
and 2009. The impairment charges below include impairments taken
as a result of these discounted cash flow analyses and also
impairment charges recorded for individual homes sold and in
backlog with net contribution margins below a minimum threshold
of profitability in communities that were otherwise impaired
through our discounted cash flow analyses. The estimated fair
value of the impaired inventory is determined immediately after
a community’s impairment. If a community was impaired in
more than one quarter in the same fiscal year, it is only
counted once in the number of communities impaired. In addition,
the information below only includes the last
fiscal impairment information with respect to the number of lots
impaired and the estimated fair value at period end for those
communities impaired multiple times in the same fiscal year.
Our assumptions about future home sales prices and absorption
rates require significant judgment because the residential
homebuilding industry is cyclical and is highly sensitive to
changes in economic conditions. During these periods, for
certain communities we determined that it was prudent to reduce
sales prices or further increase sales incentives in response to
factors including competitive market conditions in those
specific submarkets for the product and locations of these
communities. Because the projected cash flows used to evaluate
the fair value of inventory are significantly impacted by
changes in market conditions including decreased sales prices,
the change in sales prices and changes in absorption estimates
based on current market conditions and management’s
assumptions relative to future results led to additional
impairments in certain communities during the years ended
September 30, 2011, 2010 and 2009. Market deterioration
that exceeds our estimates may lead us to incur additional
impairment charges on previously impaired homebuilding assets in
addition to homebuilding assets not currently impaired but for
which indicators of impairment may arise if the market continues
to deteriorate.
The impairments on land held for sale below represent further
write downs of these properties to net realizable value, less
estimated costs to sell and are as a result of challenging
market conditions and our review of recent comparable
transactions. The negative impairments for the fiscal year ended
September 30, 2011 are due to adjustments to accruals for
estimated selling costs related to either our strategic decision
to develop a previously
held-for-sale
land position or revised estimates based on pending sales
transactions.
Our assumptions about land sales prices require significant
judgment because the current market is highly sensitive to
changes in economic conditions. We calculated the estimated fair
values of land held for sale based on current market conditions
and assumptions made by management, which may differ materially
from actual results and may result in additional impairments if
market conditions continue to deteriorate.
Also, we have determined the proper course of action with
respect to a number of communities within each homebuilding
segment was to abandon the remaining lots under option and to
write-off the deposits securing the option takedowns, as well as
pre-acquisition costs. In determining whether to abandon a lot
option contract, we evaluate the lot option primarily based upon
the expected cash flows from the property that is the subject of
the option. If we intend to abandon or walk-away from a lot
option contract, we record a charge to earnings in the period
such decision is made for the deposit amount and any related
capitalized costs associated with the lot option contract. We
recorded lot option abandonment charges during the year ended
September 30, 2011, 2010 and 2009 as indicated in the table
below. The abandonment charges relate to our decision to abandon
certain option contracts that no longer fit in our long-term
strategic plan.
The following tables set forth, by reportable homebuilding
segment, the inventory impairments and lot option abandonment
charges recorded for the fiscal 2011, 2010 and 2009 (in
thousands) :
Lot Option Agreements and Variable Interest
Entities. As previously discussed, we also have
access to land inventory through lot option contracts, which
generally enable us to defer acquiring portions of properties
owned by third parties and unconsolidated entities until we have
determined whether to exercise our lot option. A majority of our
lot option contracts require a non-refundable cash deposit or
irrevocable letter of credit based on a percentage of the
purchase price of the land for the right to acquire lots during
a specified period of time at a certain price. Under lot option
contracts, purchase of the properties is contingent upon
satisfaction of certain requirements by us and the sellers. Our
liability under option contracts is generally limited to
forfeiture of the non-refundable deposits, letters of credit and
other non-refundable amounts incurred, which aggregated
approximately $25.9 million at September 30, 2011.
This amount includes non-refundable letters of credit of
approximately $1.0 million. The total remaining purchase
price, net of cash deposits, committed under all options was
$225.2 million as of September 30, 2011. We expect to
exercise, subject to market conditions, most of our remaining
option contracts. Various factors, some of which are beyond our
control, such as market conditions, weather conditions and the
timing of the completion of development activities, will have a
significant impact on the timing of option exercises or whether
lot options will be exercised.
For the VIEs in which we are the primary beneficiary of the VIE,
we have consolidated the VIE and reflected such assets and
liabilities as land not owned under option agreements in our
balance sheets. For VIEs we were required to consolidate, we
recorded the remaining contractual purchase price under the
applicable lot option agreement to land not owned under option
agreements with an offsetting increase to obligations related to
land not owned under option agreements. Also, to reflect the
purchase price of this inventory consolidated, we reclassified
the related option deposits from land under development to land
not owned under option agreement in the accompanying
Consolidated Balance Sheets. Consolidation of these VIEs has no
impact on the Company’s results of operations or cash
flows. The following provides a summary of our interests in lot
option agreements as of September 30, 2011 (in
thousands):
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The entire disclosure for inventory. This may include, but is not limited to, the basis of stating inventory, the method of determining inventory cost, the major classes of inventory, and the nature of the cost elements included in inventory. If inventory is stated above cost, accrued net losses on firm purchase commitments for inventory and losses resulting from valuing inventory at the lower-of-cost-or-market may also be included. For LIFO inventory, may disclose the amount and basis for determining the excess of replacement or current cost over stated LIFO value and the effects of a LIFO quantities liquidation that impacts net income. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Interest
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Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest |
Our ability to capitalize all interest incurred during fiscal
2011, 2010 and 2009 has been limited by our inventory eligible
for capitalization. The following table sets forth certain
information regarding interest (in thousands):
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Interest No definition available.
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Property, Plant and Equipment
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment |
Property, plant and equipment consists of (in thousands):
Buildings and improvements as of September 30, 2011 above
includes $11.4 million related to previously owned homes
purchased by the Company for our pre-owned rental homes business
(see Note 11).
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The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Borrowings
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Borrowings |
At September 30, 2011 and 2010, we had the following
long-term debt (in thousands):
As of September 30, 2011, future maturities of our
borrowings, excluding our Mandatory Convertible Subordinated
Notes which are convertible to common stock upon maturity, are
as follows (in thousands):
Secured Revolving Credit Facility. On
August 5, 2009, we entered into an amendment to our Secured
Revolving Credit Facility that reduced the size of the facility
to $22 million. The Secured Revolving Credit Facility is
provided by one lender. The Secured Revolving Credit Facility
provides for future working capital and letter of credit needs
collateralized by either cash or assets of the Company at our
option, based on certain conditions and covenant compliance. As
of September 30, 2011, we have elected to cash
collateralize all letters of credit; however, we have pledged
approximately $1.0 billion of inventory assets to our
Senior Secured Revolving Credit Facility to collateralize
potential future borrowings or letters of credit. The Secured
Revolving Credit Facility contains certain covenants, including
negative covenants and financial maintenance covenants, with
which we are required to comply. Subject to our option to cash
collateralize our obligations under the Secured Revolving Credit
Facility upon certain conditions, our obligations under the
Secured Revolving Credit Facility are secured by liens on
substantially all of our personal property and a significant
portion of our owned real properties. There were no outstanding
borrowings under the Secured Revolving Credit Facility as of
September 30, 2011. In July 2011, we further amended our
Secured Revolving Credit Facility to extend its maturity to
August 2012.
We have entered into stand-alone, cash-secured letter of credit
agreements with banks to maintain our pre-existing letters of
credit and to provide for the issuance of new letters of credit.
The letter of credit arrangements
combined with our Senior Secured Revolving Credit Facility
provide a total letter of credit capacity of approximately
$92.1 million. As of September 30, 2011 and 2010, we
have secured letters of credit using cash collateral in
restricted accounts totaling $28.9 million and
$38.8 million, respectively. The Company may enter into
additional arrangements to provide additional letter of credit
capacity.
Senior Notes — The majority of our Senior Notes are
unsecured or secured obligations ranking pari passu with all
other existing and future senior indebtedness. Substantially all
of our significant subsidiaries are full and unconditional
guarantors of the Senior Notes and are jointly and severally
liable for obligations under the Senior Notes and the Secured
Revolving Credit Facility. Each guarantor subsidiary is a 100%
owned subsidiary of Beazer Homes.
The indentures under which the Senior Notes were issued contain
certain restrictive covenants, including limitations on payment
of dividends. At September 30, 2011, under the most
restrictive covenants of each indenture, no portion of our
retained earnings was available for cash dividends or for share
repurchases. The indentures provide that, in the event of
defined changes in control or if our consolidated tangible net
worth falls below a specified level or in certain circumstances
upon a sale of assets, we are required to offer to repurchase
certain specified amounts of outstanding Senior Notes.
Specifically, certain indentures require us to offer to purchase
10% of the original amount of the Senior Notes at par if our
consolidated tangible net worth (defined as stockholders’
equity less intangible assets) is less than $85 million at
the end of any two consecutive fiscal quarters. If triggered and
fully subscribed, this could result in our having to purchase
$62.5 million of notes, based on the original amounts of
the applicable notes; however, this amount may be reduced by
certain Senior Note repurchases (potentially at less than par)
made after the triggering date. As of September 30, 2011,
our consolidated tangible net worth was $153.1 million.
On January 8, 2010, we redeemed our
85/8% Senior
Notes due 2011 at par totaling $127.3 million. This
redemption resulted in a loss on debt extinguishment of
$0.9 million due primarily to the acceleration of debt
discount and issuance costs. In May 2010, we redeemed our
83/8% Senior
Notes due 2012 at par for a total of $303.6 million. This
redemption resulted in a loss on debt extinguishment of
$2.9 million, which included the acceleration of debt
issuance cost amortization. In addition, during the fiscal year
ended September 30, 2010, we redeemed for cash all of the
outstanding Convertible Senior Notes for a total of
$155.5 million. The redemption resulted in a loss on debt
extinguishment of $6.2 million, which included the
acceleration of debt issuance cost amortization.
On September 11, 2009, we issued and sold $250 million
aggregate principal amount of our 12% Senior Secured Notes
due 2017 (Senior Secured Notes) through a private placement. The
Senior Secured Notes were issued at a price of 89.5% of their
face amount (before underwriting and other issuance costs).
Interest on the Senior Secured Notes is payable semi-annually in
cash in arrears. During the quarter ended March 31, 2010,
we completed an offer to exchange substantially all of the
$250 million Senior Secured Notes, which were registered
under the Securities Act of 1933. The Senior Secured Notes were
issued under an indenture, dated as of September 11, 2009.
The indenture contains covenants which, subject to certain
exceptions, limit the ability of the Company and its restricted
subsidiaries to, among other things, incur additional
indebtedness, engage in certain asset sales, make certain types
of restricted payments, engage in transactions with affiliates
and create liens on assets of the Company. Upon a change of
control, as defined, the indenture requires us to make an offer
to repurchase the Senior Secured Notes at 101% of their
principal amount, plus accrued and unpaid interest. If we sell
certain assets and do not reinvest the net proceeds in
compliance with the indenture, then we must use the net proceeds
to offer to repurchase the Senior Secured Notes at 100% of their
principal amount, plus accrued and unpaid interest. After
October 15, 2012, we may redeem some or all of the Senior
Secured Notes at redemption prices set forth in the indenture.
The Senior Secured Notes are secured on a second priority basis
by, subject to exceptions specified in the related agreements,
substantially all of the tangible and intangible assets of the
Company as defined.
In May 2010, we issued $300 million aggregate principal
amount of
91/8% Senior
Notes due June 15, 2018. Interest on these notes is payable
semi-annually in cash in arrears, commencing on June 15,
2010. These notes are unsecured and rank equally with our
unsecured indebtedness. We may, at our option, redeem the
91/8% Senior
Notes
in whole or in part at any time at specified redemption prices
which include a “make whole” provision through
June 15, 2014.
Also in May 2010, we issued 3 million, publicly traded,
7.25% tangible equity units (TEUs) which were comprised of
prepaid stock purchase contracts and senior amortizing notes.
The two components of the TEUs are legally separate and
detachable, there are no beneficial conversion features
associated with these instruments, and we have accounted for the
two components as separate items for financial reporting
purposes and valued them based on their relative fair value at
the date of issuance. The amortizing notes are unsecured senior
obligations and rank equally with all of our other unsecured
indebtedness and had an aggregate initial principal amount of
$15.7 million as determined under the relative fair value
method. The prepaid stock purchase contracts will convert to
Beazer Homes stock on August 15, 2013 based on the
applicable settlement factor, as defined in the offering
agreement, which will be between 3.5126 share per unit and
4.3029 shares per unit, and were recorded as additional
paid-in-capital
at their relative fair value at the date of issuance
($57.4 million). The TEU notes pay quarterly installments
of principal and interest aggregating approximately
$1.4 million per quarter through August 15, 2013, and
in the aggregate, these installments will be equivalent to a
7.25% cash payment per year with respect to each $25 stated
amount of the TEUs. If we elect to settle the prepaid stock
purchase contracts early, we may be required to repurchase
certain amortizing notes, plus accrued and unpaid interest as
provided for in the TEU agreement. The related prepaid stock
purchase contracts will be settled in Beazer Homes’ common
stock on August 15, 2013 and have been accounted for as
equity in the accompanying Consolidated Balance Sheets.
In November 2010, we issued $250 million aggregate
principal amount of
91/8% Senior
Notes due May 15, 2019 in a private placement. Interest on
these notes is payable semi-annually in cash in arrears,
commencing on May 15, 2011. These notes are unsecured and
rank equally with our unsecured indebtedness. We may, at our
option, redeem the
91/8% Senior
Notes in whole or in part at any time at specified redemption
prices which include a “make whole” provision through
May 15, 2014. During fiscal year 2011, we offered to
exchange substantially all of the $250 million
91/8% Senior
Notes due 2019 for notes that were publically traded and
registered under the Securities Act of 1933. Approximately
$250 million of the
91/8% Senior
Notes were exchanged for the publically traded and registered
91/8% Senior
Notes during the fourth quarter of fiscal 2011.
During fiscal 2011, we redeemed or repurchased in open market
transactions $209.5 million principal amount of our Senior
Notes ($164.5 million of
61/2% Senior
Notes due 2013, $37.0 million of
67/8% Senior
Notes due 2015 and $8.0 million of
81/8% Senior
Notes due 2016). The aggregate purchase price was
$210.0 million, plus accrued and unpaid interest as of the
purchase date. The redemption/repurchase of the notes resulted
in a $2.9 million pre-tax loss on extinguishment of debt,
net of unamortized discounts and debt issuance costs related to
these notes. All Senior Notes redeemed/repurchased by the
Company were cancelled.
As of September 30, 2011, we were in compliance with all
covenants under our Senior Notes.
Mandatory Convertible Subordinated Notes. On
January 12, 2010, we issued $57.5 million aggregate
principal amount of
71/2%
Mandatory Convertible Subordinated Notes due 2013 (the Mandatory
Convertible Subordinated Notes). Interest on the Mandatory
Convertible Subordinated Notes is payable quarterly in cash in
arrears. Holders of the Mandatory Convertible Subordinated Notes
have the right to convert their notes, in whole or in part, at
any time prior to maturity, into shares of our common stock at a
fixed conversion rate of 5.4348 shares per $25 principal
amount of notes. At maturity, the remaining notes will
automatically convert into the Company’s common stock at a
defined conversion rate which will range from 4.4547 to 5.4348
(the initial conversion rate) shares per $25 principal amount of
notes based on the then current price of the common stock. The
securities are subordinated to nonconvertible debt, the
conversion feature is non-detachable and there are no beneficial
conversion features associated with this debt. If our
consolidated tangible net worth is less than $85 million as
of the last day of a fiscal quarter, the Company has the right
to require holders to convert all of the notes then outstanding
for shares of our common stock at the maximum conversion rate
plus a conversion premium as described in the agreement.
Junior Subordinated Notes. On June 15,
2006, we completed a private placement of $103.1 million of
unsecured junior subordinated notes which mature on
July 30, 2036 and are redeemable at par on or after
July 30, 2011 and pay a fixed rate of 7.987% for the first
ten years ending July 30, 2016. Thereafter, the securities
have a floating interest rate equal to three-month LIBOR plus
2.45% per annum, resetting quarterly. These notes were issued to
Beazer Capital Trust I, which simultaneously issued, in a
private transaction, trust preferred securities and common
securities with an aggregate value of $103.1 million to
fund its purchase of these notes. The transaction is treated as
debt in accordance with GAAP. The obligations relating to these
notes and the related securities are subordinated to the Secured
Revolving Credit Facility and the Senior Notes.
On January 15, 2010, we completed an exchange of
$75 million of our trust preferred securities issued by
Beazer Capital Trust I for a new issue of $75 million
of junior subordinated notes due July 30, 2036 issued by
the Company (the New Junior Notes). The exchanged trust
preferred securities and the related junior subordinated notes
issued in 2006 were cancelled effective January 15, 2010.
The material terms of the New Junior Notes are identical to the
terms of the original trust securities except that when the New
Junior Notes change from a fixed rate to a variable rate in
August 2016, the variable rate is subject to a floor of 4.25%
and a cap of 9.25%. In addition, the Company now has the option
to redeem the New Junior Notes beginning on June 1, 2012 at
75% of par value and beginning on June 1, 2022, the
redemption price of 75% of par value will increase by 1.785% per
year.
The aforementioned exchange has been accounted for as an
extinguishment of debt as there has been a significant
modification of cash flows and, as such, the New Junior Notes
were recorded at their estimated fair value at the exchange
date. Over the remaining life of the New Junior Notes, we will
increase their carrying value until this carrying value equals
the face value of the notes. During fiscal 2010, we recorded a
pre-tax gain on extinguishment of $53.6 million in
connection with this exchange. As of September 30, 2011,
the unamortized accretion was $51.2 million and will be
amortized over the remaining life of the notes.
As of September 30, 2011, we were in compliance with all
covenants under our Junior Notes.
Cash Secured Loans. In November 2010, we
entered into two separate loan facilities for a combined total
of $275 million. Borrowing under the cash secured loan
facilities will replenish cash used to repay or repurchase the
Company’s debt and would be considered “refinancing
indebtedness” under certain of the Company’s existing
indentures and debt covenants. However, because the loans are
fully collateralized by cash equal to the loan amount, the loans
do not provide liquidity to the Company.
The lenders of these facilities may put the outstanding loan
balances to the Company at the two or four year anniversaries of
the loan. The loan matures in seven years. Borrowings under the
facilities are fully secured by cash held by the lender or its
affiliates. This secured cash is reflected as restricted cash on
our consolidated balance sheet as of September 30, 2011. We
borrowed $32.6 million at inception of the loans. As
previously indicated and in order to protect financing capacity
available under our covenant refinancing basket related to
previous or future debt repayments, we borrowed an additional
$214.8 million under the cash secured loan facilities in
the quarter ended June 30, 2011. The cash secured loan has
an interest rate equivalent to LIBOR plus 0.4% per annum which
is paid every three months following the effective date of each
borrowing.
Other Secured Notes Payable. We periodically
acquire land through the issuance of notes payable. As of
September 30, 2011 and 2010, we had outstanding notes
payable of $2.3 million and $10.8 million,
respectively, primarily related to land acquisitions. These
notes payable expire between 2012 and 2016 and have a weighted
average fixed rate of 7.135% at September 30, 2011. The
notes are secured by the real estate to which they relate.
The agreements governing these secured notes payable contain
various affirmative and negative covenants. There can be no
assurance that we will be able to obtain any future waivers or
amendments that may become necessary without significant
additional cost or at all. In each instance, however, a covenant
default can be cured by repayment of the indebtedness.
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The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Fair Value Measurements
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Fair Value Measurements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements |
As of September 30, 2011, we had no assets or liabilities
in our consolidated balance sheets that were required to be
measured at fair value on a recurring basis. Certain of our
assets are required to be recorded at fair value on a
non-recurring basis when events and circumstances indicate that
the carrying value may not be recovered. We use a fair value
hierarchy that requires us to maximize the use of observable
inputs and minimize the use of unobservable inputs when
measuring fair value as follows: Level 1 — Quoted
prices in active markets for identical assets or liabilities;
Level 2 — Inputs other than quoted prices
included in Level 1 that are observable either directly or
indirectly through corroboration with market data;
Level 3 — Unobservable inputs that reflect our
own estimates about the assumptions market participants would
use in pricing the asset or liability.
The following table presents our assets measured at fair value
on a non-recurring basis for each hierarchy level and represents
only those assets whose carrying values were adjusted to fair
value during the year ended September 30, 2011 and 2010
(in thousands):
As previously disclosed, we review our long-lived assets,
including inventory for recoverability when factors that
indicate an impairment may exist, but no less than quarterly.
Fair value is based on estimated cash flows discounted for
market risks associated with the long-lived assets. The fair
values of our investments in unconsolidated joint ventures are
determined primarily using a discounted cash flow model to value
the underlying net assets of the respective entities. During the
year ended September 30, 2011, we recorded total
impairments, including discontinued operations, of
$29.6 million, $0.4 million and $0.6 million for
development projects in progress, land held for sale and joint
venture investments, respectively. During the year ended
September 30, 2010, we recorded total impairments,
including discontinued operations, of $48.9 million and
$2.1 million and $24.3 million for development
projects in progress, land held for sale, and joint venture
investments, respectively. See Notes 1 and 3 for additional
information related to the fair value accounting for the assets
listed above. Determining which hierarchical level an asset or
liability falls within requires significant judgment. We
evaluate our hierarchy disclosures each quarter.
The fair value of our cash and cash equivalents, restricted
cash, accounts receivable, trade accounts payable, other
liabilities, cash secured loan and other secured notes payable
approximate their carrying amounts due to the short maturity of
these assets and liabilities. Obligations related to land not
owned under option agreements are
recorded at estimated fair value. The carrying values and
estimated fair values of other financial assets and liabilities
were as follows (in thousands):
The estimated fair values shown above for our publicly held
Senior Notes and Mandatory Convertible Subordinated Notes have
been determined using quoted market rates. The fair value of our
publicly held junior subordinated notes is estimated by
discounting scheduled cash flows through maturity. The discount
rate is estimated using market rates currently being offered on
loans with similar terms and credit quality. Judgment is
required in interpreting market data to develop these estimates
of fair value. Accordingly, the estimates presented herein are
not necessarily indicative of the amounts that we could realize
in a current market exchange.
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The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Income Taxes
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Income Taxes [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes |
The provision (benefit) for income taxes from continuing
operations consists of the following (in thousands):
The provision (benefit) for income taxes from continuing
operations differs from the amount computed by applying the
federal income tax statutory rate as follows (in
thousands):
The principal difference between our effective rate and the
U.S. federal statutory rate relates to our valuation
allowance.
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of the assets and
liabilities for financial reporting purposes and the amounts
used for income tax purposes. The tax effects of significant
temporary differences that give rise to the net deferred tax
asset are as follows (in thousands):
At September 30, 2011, our gross deferred tax assets above
included $224.4 million for federal net operating loss
carryforwards, $71.7 million for state net operating loss
carryforwards and $9.8 million for an alternative minimum
tax credit. The net operating loss carryforwards expire at
various dates through 2031.
A reduction of the carrying amounts of deferred tax assets by a
valuation allowance is required if, based on the available
evidence, it is more likely than not that such assets will not
be realized. Accordingly, the need to establish valuation
allowances for deferred tax assets is assessed periodically
based on the more-likely-than-not realization threshold
criterion. In the assessment for a valuation allowance,
appropriate consideration is given to all positive and negative
evidence related to the realization of the deferred tax assets.
This assessment considers, among other matters, the nature,
frequency and severity of current and cumulative losses,
forecasts of future profitability, the duration of statutory
carryforward periods, the Company’s experience with loss
carryforwards not expiring unused and tax planning alternatives.
Based upon an evaluation of all available evidence, we
established a valuation allowance for substantially all of our
deferred tax assets during fiscal 2008. Given the prolonged
economic downturn affecting the homebuilding industry and the
continued uncertainty regarding the recoverability of the
remaining deferred tax assets, we continue to believe that a
valuation allowance is needed for substantially all of our
deferred tax assets. Therefore, at September 30, 2011 and
2010, the Company’s deferred tax asset valuation allowance
was $479.3 million and $403.8 million, respectively.
In future periods, the allowance could be modified based on
sufficient evidence indicating that more likely than not a
portion of our deferred tax assets will be realized. Changes in
existing tax laws could also affect actual tax results and the
valuation of deferred tax assets over time.
Further, we experienced an “ownership change” as
defined in Section 382 of the Internal Revenue Code
(Section 382) as of January 12, 2010.
Section 382 contains rules that limit the ability of a
company that undergoes an “ownership change” to
utilize its net operating loss carryforwards (NOLs) and certain
built-in losses or deductions recognized during the five-year
period after the ownership change to offset future taxable
income. Therefore, our ability to utilize our pre-ownership
change net operating loss carryforwards and recognize certain
built-in losses or
deductions is limited by Section 382 to an estimated
maximum amount of approximately $11.4 million
($4 million tax-effected) annually. Certain deferred tax
assets are not subject to any limitation imposed by
Section 382.
Due to the Section 382 limitation and the maximum
carryforward period of our NOLs, we are unable to fully
recognize certain deferred tax assets. Accordingly, during
fiscal 2011 and 2010, we reduced our gross deferred tax assets
and corresponding valuation allowance by $0.9 million and
$5.9 million, respectively. As of September 30, 2010,
we had disclosed that up to $183.2 million of gross
deferred tax assets related to accrued losses on our inventory
may have been unavailable due to the limitation imposed by
Section 382. Based on certain economic results during
fiscal 2011, we have revised our previous estimate and, after
adjusting for certain state NOLs and other deferred tax assets
which may not be recoverable, we now estimate that up to
$157.4 million of gross deferred tax assets may be
unavailable due to the limitation imposed by Section 382.
However, based on our annual assessment, our current realization
projections for our built in losses support that only
$70.1 million of our deferred tax asset is likely to be
unavailable under Section 382. As future economic
conditions unfold, we will be able to confirm that certain
deferred tax assets will not provide any future tax benefit. At
such time, we will accordingly remove any deferred tax asset and
corresponding valuation allowance.
Considering the limitation imposed by Section 382, the
table below depicts the classifications of our deferred tax
assets:
Therefore, based on the classification of which deferred tax
assets are likely to be impacted by our annual limitation, as of
September 30, 2011, we had deferred tax assets, net of
$54.0 million of deferred tax liabilities, of
$482.1 million. While the actual realization of the
deferred tax assets is difficult to predict and is dependent on
future events, as evidenced by our current valuation allowance,
we currently anticipate that between $324.7 million and
$412.0 million of these deferred tax assets may be
available even after consideration of the Section 382
imposed limitation. Further, we expect to continue to add to our
gross deferred tax assets for anticipated NOLs that will not be
limited by Section 382.
A reconciliation of the beginning and ending amount of
unrecognized tax benefits at the beginning and end of fiscal
2011, 2010 and 2009 is as follows (in thousands):
If the Company were to recognize the $46.6 million of gross
unrecognized tax benefits, substantially all of which would
affect our effective tax rate. The Company expects the total
amount of unrecognized tax benefits to decrease by
$27.2 million, resulting in a non-cash tax benefit, within
twelve months as a result of tax planning, settlements with
various taxing authorities and the expiration of certain
statutes of limitations. Additionally, we had $8.2 million
and $6.0 million of accrued interest and penalties at
September 30, 2011 and 2010, respectively. Our income tax
benefit includes tax related interest.
In the normal course of business, we are subject to audits by
federal and state tax authorities regarding various tax
liabilities. The IRS is currently conducting a routine
examination of our federal income tax returns for fiscal year
2007 through 2010, and certain state taxing authorities are
examining various fiscal years. The statute of limitations for
our major tax jurisdictions remains open for examination for
fiscal years 2006 and subsequent years.
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The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Leases
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Sep. 30, 2011
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases |
We are obligated under various noncancelable operating leases
for office facilities, model homes and equipment. Rental expense
under these agreements, which is included in general and
administrative expenses, amounted to approximately
$11.0 million, $10.3 million and $12.2 million
for the years ended September 30, 2011, 2010 and 2009,
respectively. This rental expense excludes expense related to
our discontinued operations. As of September 30, 2011,
future minimum lease payments under noncancelable operating
lease agreements are as follows (in thousands):
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The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Stockholders' Equity
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Sep. 30, 2011
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Stockholders' Equity [Abstract] | |||||
Stockholders' Equity |
Preferred Stock. We currently have no shares
of preferred stock outstanding.
Common Stock Transactions. On January 12,
2010, we closed on our underwritten public offering of
22,425,000 shares of Beazer common stock. The Company
utilized 3.4 million shares of treasury stock and received
net proceeds of $97.8 million from the offering, after
underwriting discounts, commissions and transaction expenses.
On May 10, 2010, we concurrently closed on our underwritten
public offerings of 12.5 million shares of Beazer common
stock and 3.0 million 7.25% tangible equity units (TEUs)
and received net proceeds of $141.6 million from these two
offerings, after underwriting discounts, commissions and
transaction expenses. Each TEU is comprised of a prepaid stock
purchase contract and a senior amortizing note due
August 15, 2013 (see Note 7 for discussion of the
amortizing notes) which are legally separable and detachable.
The prepaid stock purchase contracts will convert to Beazer
Homes stock on August 15, 2013 based on the applicable
settlement factor, as defined in the offering agreement, which
will be between 3.5126 shares per unit and
4.3029 shares per unit. We have accounted for the prepaid
stock purchase contracts as equity and recorded
$57.4 million, the initial fair value of these contracts,
based on the relative fair value method, as additional paid in
capital as of September 30, 2010.
Common Stock Repurchases. During fiscal 2011,
2010 and 2009, we did not repurchase any shares in the open
market. Any future stock repurchases as allowed by our debt
covenants must be approved by the Company’s Board of
Directors or its Finance Committee.
During fiscal 2011, 2010 and 2009, 52,198, 32,944 and
14,393 shares, respectively, were surrendered to us by
employees in payment of minimum tax obligations upon the vesting
of restricted stock and restricted stock units under our stock
incentive plans. We valued the stock at the market price on the
date of surrender, for an aggregate value of approximately
$170,000, or approximately $3 per share in fiscal 2011,
$160,000, or approximately $5 per share in fiscal 2010 and
$21,000, or approximately $2 per share in fiscal 2009.
Dividends. The indentures under which our
senior notes were issued contain certain restrictive covenants,
including limitations on payment of dividends. At
September 30, 2011, under the most restrictive covenants of
each indenture, none of our retained earnings was available for
cash dividends. Hence, there were no dividends paid in fiscal
2011, 2010 and 2009.
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The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Retirement Plan and Incentive Awards |
401(k) Retirement Plan. We sponsor a 401(k)
plan (the Plan). Substantially all employees are eligible for
participation in the Plan after completing one calendar month of
service with us. Participants may defer and contribute to the
Plan from 1% to 80% of their salary with certain limitations on
highly compensated individuals. We match 50% of the first 6% of
the participant’s contributions. The participant’s
contributions vest 100% immediately, while our contributions
vest over five years. Our total contributions for the fiscal
years ended September 30, 2011, 2010 and 2009 were
approximately $1.5 million, $1.6 million and
$1.1 million, respectively. During fiscal 2011, 2010 and
2009, participants forfeited $0.2 million,
$0.1 million and $0.7, million, respectively, of unvested
matching contributions.
Deferred Compensation Plan. During fiscal
2002, we adopted the Beazer Homes USA, Inc. Deferred
Compensation Plan (the DCP Plan). The DCP Plan is a
non-qualified deferred compensation plan for a select group of
executives and highly compensated employees. The DCP Plan allows
the executives to defer current compensation on a pre-tax basis
to a future year, up until termination of employment. The
objectives of the DCP Plan are to assist executives with
financial planning and capital accumulation and to provide the
Company with a method of attracting, rewarding, and retaining
executives. Participation in the DCP Plan is voluntary. Beazer
Homes may voluntarily make a contribution to the
participants’ DCP accounts. Deferred compensation assets of
$5.9 million and $9.9 million and deferred
compensation liabilities of $7.1 million and
$10.7 million as of September 30, 2011 and 2010,
respectively, are included in other assets and other liabilities
on the accompanying Consolidated Balance Sheets. The decrease in
the deferred compensation assets and liabilities between fiscal
2010 and fiscal 2011 relates to employee elections to withdraw
funds from the plan, forfeitures of matching contributions
related to terminated employees and market losses on investments
held within the plan. For the years ended September 30,
2011, 2010 and 2009, Beazer Homes contributed approximately
$197,000, $273,000 and $355,000, respectively, to the DCP Plan.
Stock Incentive Plans. During fiscal 2010, we
adopted the 2010 Stock Incentive Plan (the 2010 Plan) because
our 1999 Stock Incentive Plan (the 1999 Plan) had expired. At
September 30, 2011, we had reserved approximately
5.9 million shares of common stock for issuance under our
various stock incentive plans, of which approximately
4.0 million shares are available for future grants.
Stock Option and SSAR Awards. We have issued
various stock option and SSAR awards to officers and key
employees under both the 2010 Plan and the 1999 Plan. Stock
options have an exercise price equal to the fair market value of
the common stock on the grant date, vest three years after the
date of grant and may be exercised thereafter until their
expiration, subject to forfeiture upon termination of employment
as provided in the applicable plan. Under certain conditions of
retirement, eligible participants may receive a partial vesting
of stock options. Stock options granted prior to fiscal 2004,
generally expire on the tenth anniversary from the date such
options were granted. Beginning in fiscal 2004, newly granted
stock options expire on the seventh anniversary from the date
such options were granted. SSARs generally vest three years
after the date of grant, have an exercise price equal to the
fair market value of the common stock on the date of grant and
are subject to forfeiture upon termination of employment as
provided in the applicable plan. Under certain conditions of
retirement, eligible participants may receive a partial vesting
of SSARs.
The following table summarizes stock options and SSARs
outstanding as of September 30 and activity during the fiscal
years ended September 30:
The fair value of each grant is estimated on the date of grant
using the Black-Scholes option-pricing model based on the
following assumptions:
The expected volatility is based on the historic returns of our
stock and the implied volatility of our publicly-traded options.
We assumed no dividends would be paid since our Board of
Directors has suspended payment of dividends indefinitely. The
risk-free interest rate is based on the term structure of
interest rates at the time of the option grant and we have
relied upon a combination of the observed exercise behavior of
our prior grants with similar characteristics, the vesting
schedule of the current grants, and an index of peer companies
with similar grant characteristics to determine the expected
life of the options.
At September 30, 2011, 1,838,465 SSARs/stock options were
vested or expected to vest in the future with a weighted average
exercise price of $9.86 and a weighted average expected life of
2.74 years. At September 30, 2011, there was no
aggregate intrinsic value of SSARs/stock options, vested and
expected to vest in the future, and
exercisable. The intrinsic value of a stock option/SSAR is the
amount by which the market value of the underlying stock exceeds
the exercise price of the option/SSAR.
During the first quarter of fiscal 2010, certain executive
officers and directors elected to relinquish 465,933 vested and
outstanding options that had exercise prices above $20 per share
in order to provide additional shares for use in the
Company’s January 2010 public stock offering.
On August 5, 2008, at the Company’s annual meeting of
stockholders, the stockholders voted to approve amendments to
the 1999 Plan to authorize a stock option/SSAR exchange program
for eligible employees other than executive officers and
directors. On August 4, 2009 we offered to exchange stock
options/SSARs with exercise prices ranging from $26.51 to $62.02
per share for newly issued restricted shares of common stock
based on the exercise price of the eligible awards exchanged.
This exchange was structured to be a value for value exchange
and, as of the grant date, there was no incremental expense
recorded related to this exchange. Stock options/SSARs to
purchase 292,969 shares of our common stock were cancelled
and exchanged for 90,405 restricted shares of stock with a grant
price of $4.16.
The following table summarizes information about stock options
and SSARs outstanding and exercisable at September 30, 2011:
For the years ended September 30, 2011, 2010, and 2009,
total non-cash stock-based compensation expense, included in
G&A expenses, was $7.2 million ($4.5 million net
of tax), $11.4 million ($7.6 million net of tax) and
$11.8 million ($8.3 million net of tax), respectively.
Nonvested Stock Awards. We have made various
non-vested stock awards to officers and key employees under the
2010 Plan and the 1999 Plan. All restricted stock is awarded in
the name of the participant, who has all the rights of other
common stockholders with respect to such stock, subject to
restrictions and forfeiture provisions. Accordingly, such
nonvested stock awards are considered outstanding shares.
Restricted stock awards generally vest from three to seven years
after the date of grant. Certain restricted stock awards provide
for accelerated vesting if certain performance goals are
achieved.
In fiscal 2009 as discussed above, we exchanged certain stock
options/SSARs to purchase shares of our common stock for
restricted shares of common stock. These restricted shares will
vest 50% on the first anniversary of the exchange and 50% on the
second anniversary of the exchange. We valued these restricted
shares in accordance with GAAP based on the remaining
unamortized cost of the exchanged stock options/SSARs. The
weighted average exchange price fair value of these restricted
shares was $4.16 per share. Our estimated fair value of these
restricted shares will be amortized over the applicable vesting
period.
Prior to fiscal 2008, participants in certain of our management
incentive compensation programs could defer a portion of their
earned annual incentive compensation under the applicable plan
pursuant to the terms of the Corporate Management Stock Purchase
Program (the CMSPP). The deferred amounts are represented by
restricted stock units, each of which represents the right to
receive one share of Beazer Homes’ common stock upon
vesting. Such shares are issued after a three-year vesting
period, subject to an election for further deferral by the
participant. The number of restricted stock units granted is
based on a discount to the market value of our common stock at
the
time the bonus is earned. Should the participant’s
employment terminate during the vesting period, the deferred
incentive compensation is settled in cash or cash and stock,
depending on the cause of termination as set forth in the CMSPP
or applicable deferred compensation plan. Due to low
availability of shares at the beginning of fiscal 2008 under the
1999 Plan, from which shares under CMSPP are issued, the
Compensation Committee suspended this program until further
notice.
Activity relating to nonvested stock awards for the years ended
September 30, 2011 and 2010 are as follows:
Compensation expense for the nonvested restricted stock awards
totaled $3.8 million, $5.6 million and
$6.6 million for the fiscal years ended September 30,
2011, 2010 and 2009, respectively.
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The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. No definition available.
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Contingencies
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Contingencies |
Beazer Homes and certain of its subsidiaries have been and
continue to be named as defendants in various construction
defect claims, complaints and other legal actions. The Company
is subject to the possibility of loss contingencies arising in
its business. In determining loss contingencies, we consider the
likelihood of loss as well as the ability to reasonably estimate
the amount of such loss or liability. An estimated loss is
recorded when it is considered probable that a liability has
been incurred and when the amount of loss can be reasonably
estimated.
Warranty Reserves. We currently provide a
limited warranty (ranging from one to two years) covering
workmanship and materials per our defined performance quality
standards. In addition, we provide a limited warranty (generally
ranging from a minimum of five years up to the period covered by
the applicable statute of repose) covering only certain defined
construction defects. We also provide a defined structural
warranty with single-family homes and townhomes in certain
states.
Since we subcontract our homebuilding work to subcontractors
whose contracts generally include an indemnity obligation and a
requirement that certain minimum insurance requirements be met,
including providing us with a certificate of insurance prior to
receiving payments for their work, many claims relating to
workmanship and materials are the primary responsibility of the
subcontractors.
Warranty reserves are included in other liabilities and the
provision for warranty accruals is included in home construction
and land sales expenses in the consolidated financial
statements. We record reserves covering anticipated warranty
expense for each home closed. Management reviews the adequacy of
warranty reserves each reporting period based on historical
experience and management’s estimate of the costs to
remediate the claims and adjusts these provisions accordingly.
Our review includes a quarterly analysis of the historical data
and trends in warranty expense by operating segment. An analysis
by operating segment allows us to consider market specific
factors such as our warranty experience, the number of home
closings, the prices of homes, product mix and other data in
estimating our warranty reserves. In addition, our analysis also
contemplates the existence of any non-recurring or
community-specific warranty related matters that might not be
contemplated in our historical data and trends.
As of September 30, 2011, our warranty reserves include an
estimate for the repair of less than 60 homes in Florida where
certain of our subcontractors installed defective Chinese
drywall in homes that were delivered during our 2006 and 2007
fiscal years. As of September 30, 2011, we have completed
repairs on approximately 92% of these homes and we are in the
process of repairing all of the remaining homes that we have
been given permission to repair. We continue to inspect
additional homes in order to determine whether they also contain
the defective Chinese drywall. Like most major homebuilders, we
contract for many of our construction activities on a turnkey
basis, including the purchase and installation of drywall.
Therefore, with few exceptions, our contractors purchased the
drywall from independent suppliers, and delivered and installed
this drywall into Beazer’s homes. Much of this data is
unavailable or inconclusive. Accordingly, it is difficult for
the Company to determine which suppliers were used by these
contractors, which suppliers provided defective Chinese drywall
during the time period at issue or what amounts may have been
purchased from such suppliers. As a result, it is difficult for
the Company to determine which Beazer communities or particular
homes had Chinese drywall installed without inspections and, the
amount of additional liability, if any, is not reasonably
estimable. Therefore, the outcome of inspections in process and
potential future inspections or an unexpected increase in repair
costs may require us to increase our warranty reserve in the
future. In addition, the Company has been named as a defendant
in a number of legal actions related to defective Chinese
drywall (see Other Litigation below).
As a result of our analyses, we adjust our estimated warranty
liabilities. While we believe that our warranty reserves are
adequate as of September 30, 2011, historical data and
trends may not accurately predict actual warranty costs or
future developments could lead to a significant change in the
reserve. Our warranty reserves are as follows (in
thousands):
South
Edge Litigation
During fiscal 2008, the administrative agent for the lenders of
one of our unconsolidated joint ventures, South Edge, filed
individual lawsuits against some of the joint venture members
and certain of those members’ parent companies (including
the Company), seeking to recover damages under completion
guarantees, among other claims. As discussed in Note 3,
South Edge was the subject of an involuntary bankruptcy petition
filed in December 2010. During fiscal 2011, the Company and one
of its subsidiaries became parties to a settlement among the
administrative agent for the lenders to South Edge (the
Administrative Agent), certain of the lenders to South Edge, and
certain of the other South Edge members and their respective
parent companies (together with the Company and its subsidiary,
the Participating Members). On October 26, 2011, the
bankruptcy court approved the South Edge plan of reorganization
including the settlement agreement.
Pursuant to the agreement, the Company would pay to the lenders
an amount between approximately $15.7 million and
$17.2 million, depending on certain contingencies including
the extent to which infrastructure development funds already
pledged to the Administrative Agent can be applied to the
Participating Members’ obligations as set forth under the
proposed Plan. In addition to these amounts, the Company will be
responsible for its pro rata share of various fees, expenses and
charges of the administrative agent for the lenders, the lenders
and the Chapter 11 trustee, and to pay its share of certain
allowed general unsecured claims in the South Edge bankruptcy
case. As previously disclosed in Note 3, as of
September 30, 2011, $15.7 million has been recorded in
Other
Liabilities which is net of the $1.5 million we paid and is
currently held in escrow related to our South Edge joint venture.
Under the agreement, the Company anticipates that one of its
subsidiaries would acquire its share of the land previously
owned by South Edge as a result of a bankruptcy court-approved
disposition of the land to a newly created entity in which such
subsidiary would expect to be a member and which would satisfy
the obligations secured by the liens of the Administrative Agent
and the lenders on the land. Matters related to this litigation
are more fully discussed in Note 3.
Other
Litigation
Homeowners Class Action Lawsuits and Multi-Plaintiff
Lawsuit. A putative class action was filed on
April 8, 2008 in the United States District Court for the
Middle District of North Carolina, Salisbury Division, against
Beazer Homes, U.S.A., Inc., Beazer Homes Corp. and Beazer
Mortgage Corporation (BMC). The Complaint alleges that Beazer
violated the Real Estate Settlement Practices Act (RESPA) and
North Carolina Gen. Stat.
§ 75-1.1
by (1) improperly requiring homebuyers to use Beazer-owned
mortgage and settlement services as part of a down payment
assistance program, and (2) illegally increasing the cost
of homes and settlement services sold by Beazer Homes Corp. On
September 2, 2011, the court entered a final judgment and
order approving a class settlement in which the Company and all
other defendants did not admit any liability. The settling class
consists of all persons who purchased a home from Beazer in
North Carolina, closed on the home purchase between
August 1, 2002 and August 31, 2011, and received
seller-funded down payment assistance as part of the
transaction. Under the terms of the settlement, the Company has
made a payment that is not material to the Company’s
financial position or results of operations and which will be
partially funded by insurance proceeds.
On June 3, 2009, Beazer Homes Corp. was named as a
defendant in a purported class action lawsuit in the Circuit
Court for Lee County, State of Florida, filed by Bryson and
Kimberly Royal, the owners of one of our homes in our Magnolia
Lakes’ community in Ft. Myers, Florida. The complaint
names the Company and certain distributors and suppliers of
drywall and was on behalf of the named plaintiffs and other
similarly situated owners of homes in Magnolia Lakes or
alternatively in the State of Florida. The plaintiffs allege
that the Company built their homes with defective drywall,
manufactured in China, that contains sulfur compounds that
allegedly corrode certain metals and that are allegedly capable
of harming the health of individuals. Plaintiffs allege physical
and economic damages and seek legal and equitable relief,
medical monitoring and attorney’s fees. This case has been
transferred to the Eastern District of Louisiana pursuant to an
order from the United States Judicial Panel on Multidistrict
Litigation. In addition, the Company has been named in other
multi-plaintiff complaints filed in the multidistrict
litigation. We believe that the claims asserted in these actions
are governed by home warranties or are without merit.
Accordingly, the Company intends to vigorously defend against
these actions. Furthermore, the Company has offered to repair
all Beazer homes affected by defective Chinese drywall pursuant
to a repair protocol that has been adopted by the multidistrict
litigation court, including those homes involved in litigation.
To date, nearly all of affected Beazer homeowners have accepted
the Company’s offer to repair. The Company also continues
to pursue recovery against responsible subcontractors, drywall
suppliers and drywall manufacturers for its repair costs.
On March 14, 2011, the Company and several subsidiaries
were named as defendants in a lawsuit filed by Flagstar Bank,
FSB in the Circuit Court for the County of Oakland, State of
Michigan. The complaint demands approximately $5 million to
recover purported losses in connection with 57 residential
mortgage loan transactions under theories of breach of contract,
fraud/intentional misrepresentation and other similar theories
of recovery. We believe we have strong defenses to the claims on
these individual loans and intend to vigorously defend the
action. In addition, BMC has received notices from other
investors demanding that BMC indemnify them for losses suffered
with respect to certain other mortgage loan transactions,
largely alleging misrepresentations during the loan origination
process. We are currently investigating these claims and are in
communication with the investors. To date, including the
mortgage loans that are the subject of the lawsuit, we have
received requests to repurchase fewer than 100 mortgage loans
from various investors. As previously disclosed, we operated BMC
from 1998
through February 2008 to offer mortgage financing to the buyers
of our homes. BMC entered into various agreements with mortgage
investors, pursuant to which BMC originated certain mortgage
loans and ultimately sold those loans to investors. Underwriting
decisions were not made by BMC but by the investors themselves
or third-party service providers. While we have not been
required to repurchase any mortgage loans, we have established
an immaterial amount as a reserve for the repurchase of mortgage
loans originated by BMC. We cannot rule out the potential for
additional mortgage loan repurchase claims in the future,
although, at this time, we do not believe that the exposure
related to any such additional claims would be material to our
consolidated financial position or results of operation. As of
September 30, 2011, no liability has been recorded for any
such additional claims as such exposure is not both probable and
reasonably estimable.
On March 15, 2011, a shareholder derivative suit was filed
by certain funds affiliated with Teamster Local 237 in the
Superior Court of Fulton County, State of Georgia against
certain officers and directors of the Company and the
Company’s compensation consultants. The complaint alleges
breach of fiduciary duties involving decisions regarding
executive compensation; specifically that compensation awarded
to certain Company executives for the 2010 fiscal year were
improper in light of the negative subsequent advisory “say
on pay” vote by shareholders at the Company’s 2011
stockholders meeting. On September 16, 2011, the court
entered an order and granted the defendants’ motion to
dismiss all counts of the complaint. The plaintiffs have filed a
notice of appeal.
We cannot predict or determine the timing or final outcome of
the lawsuits or the effect that any adverse findings or adverse
determinations in the pending lawsuits may have on us. In
addition, an estimate of possible loss or range of loss, if any,
cannot presently be made with respect to certain of the above
pending matters. An unfavorable determination in any of the
pending lawsuits could result in the payment by us of
substantial monetary damages which may not be fully covered by
insurance. Further, the legal costs associated with the lawsuits
and the amount of time required to be spent by management and
the Board of Directors on these matters, even if we are
ultimately successful, could have a material adverse effect on
our business, financial condition and results of operations.
Other
Matters
As disclosed in our 2009
Form 10-K,
on July 1, 2009, the Company announced that it has resolved
the criminal and civil investigations by the United States
Attorney’s Office in the Western District of North Carolina
(the U.S. Attorney) and other state and federal agencies
concerning matters that were the subject of the independent
investigation, initiated in April 2007 by the Audit Committee of
the Board of Directors (the Investigation) and concluded in May
2008. Under the terms of a deferred prosecution agreement (DPA),
the Company’s liability for fiscal 2011 and each of the
fiscal years after 2010 through a portion of fiscal 2014 (unless
extended as previously described in our 2009
Form 10-K)
will also be equal to 4% of the Company’s adjusted EBITDA
(as defined in the DPA). The total amount of such obligations
will be dependent on several factors; however, the maximum
liability under the DPA and other settlement agreements
discussed above will not exceed $55.0 million of which
$16 million has been paid as of September 30, 2011. As
of September 30, 2010, we had accrued approximately
$1 million for future obligations under the DPA and HUD
agreements which was paid in November 2010. Based on our
adjusted EBITDA for fiscal 2011, we do not have an accrual
related to these future obligations as of September 30,
2011. Positive adjusted EBITDA in future years will require us
to incur additional expense in the future.
In 2006, we received two Administrative Orders issued by the New
Jersey Department of Environmental Protection. The Orders allege
certain violations of wetlands disturbance permits. The two
Orders assess proposed fines of $630,000 and $678,000,
respectively. We have met with the Department to discuss their
concerns on the two affected communities and have requested
hearings on both matters. We believe that we have significant
defenses to the alleged violations and intend to contest the
agency’s findings and the proposed fines. We are currently
pursuing settlement discussions with the Department.
We and certain of our subsidiaries have been named as defendants
in various claims, complaints and other legal actions, most
relating to construction defects, moisture intrusion and product
liability. Certain of the liabilities resulting from these
actions are covered in whole or part by insurance. In our
opinion, based on our current
assessment, the ultimate resolution of these matters will not
have a material adverse effect on our financial condition,
results of operations or cash flows.
We have accrued $30.4 million and $18.0 million in
other liabilities related to all of the above matters as of
September 30, 2011 and 2010, respectively.
We had outstanding letters of credit and performance bonds of
approximately $28.9 million and $174.7 million,
respectively, at September 30, 2011 related principally to
our obligations to local governments to construct roads and
other improvements in various developments. Our outstanding
letters of credit include $1.0 million relating to our land
option contracts discussed in Note 4.
|
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- Details
|
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The entire disclosure for commitments and contingencies. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Segment Information
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Segment Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information |
We have three homebuilding segments operating in 16 states
and beginning in the second quarter of fiscal 2011, we
introduced our Pre-Owned Homes division in Arizona and Nevada.
Revenues in our homebuilding segments are derived from the sale
of homes which we construct and from land and lot sales.
Revenues from our Pre-Owned segment are derived from the rental
and ultimate sale of previously owned homes purchased and
improved by the Company. Our reportable segments have been
determined on a basis that is used internally by management for
evaluating segment performance and resource allocations. During
the third quarter of fiscal 2011, in order to further optimize
capital and resource allocations and based on our evaluation of
both external market factors and our position in each market, we
decided to discontinue our homebuilding operations in Northwest
Florida. As a result, the information below for continuing
operations and the Southeast segment, excludes results from our
Northwest Florida market. The reportable homebuilding segments
and all other homebuilding operations, not required to be
reported separately, include operations conducting business in
the following states:
West: Arizona, California, Nevada and Texas
Southeast: Florida, Georgia, North Carolina
(Raleigh) and South Carolina
Management’s evaluation of segment performance is based on
segment operating income. Operating income for our homebuilding
segments is defined as homebuilding, land sale and other
revenues less home construction, land development and land sales
expense, commission expense, depreciation and amortization and
certain general and administrative expenses which are incurred
by or allocated to our homebuilding segments. Operating income
for our Pre-Owned segment is defined as rental and home sale
revenues less home repairs and operating expenses, home sales
expense, depreciation and amortization and certain general and
administrative expenses which are incurred by or allocated to
the segment. The accounting policies of our segments are those
described in Note 1. The following information is in
thousands:
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- Details
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- Definition
The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Discontinued Operations
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Discontinued Operations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations |
We continually review each of our markets in order to refine our
overall investment strategy and to optimize capital and resource
allocations in an effort to enhance our financial position and
to increase shareholder value. This review entails an evaluation
of both external market factors and our position in each market
and over time, has resulted in the decision to discontinue
certain of our homebuilding operations. During fiscal 2008, we
discontinued our homebuilding operations in Charlotte, NC,
Cincinnati/Dayton, OH, Columbia, SC, Columbus, OH, Lexington,
KY, Denver, CO and Fresno, CA. During fiscal 2010, we
substantially completed our homebuilding operations in
Jacksonville, Florida and Albuquerque, New Mexico. During the
third quarter of fiscal 2011, we decided to discontinue our
homebuilding operations in Northwest Florida which have
historically been reported in our Southeast segment.
Up until September 30, 2010, we offered title services to
our homebuyers in several of our markets. Effective
September 30, 2010, we had sold or discontinued all of our
title services operations.
We have classified the results of operations of our prior
mortgage origination services, title services and our exit
markets as discontinued operations in the accompanying
consolidated statements of operations for all periods presented.
Discontinued operations were not segregated in the consolidated
balance sheets or statements of cash flows. Therefore, amounts
for certain captions in the consolidated statements of cash
flows will not agree with the respective data in the
consolidated statements of operations. The results of our
discontinued operations in the
Consolidated Statements of Operations for the fiscal years ended
September 30, 2011, 2010, and 2009 were as follows (in
thousands):
Assets and liabilities from discontinued operations at
September 30, 2011 and 2010 consist of the following (in
thousands):
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- Details
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- Definition
The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Supplemental Guarantor Information
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Sep. 30, 2011
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Supplemental Guarantor Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Guarantor Information |
As discussed in Note 7, our obligations to pay principal,
premium, if any, and interest under certain debt are guaranteed
on a joint and several basis by substantially all of our
subsidiaries. Certain of our title, warranty and immaterial
subsidiaries do not guarantee our Senior Notes or our Secured
Revolving Credit Facility. The guarantees are full and
unconditional and the guarantor subsidiaries are 100% owned by
Beazer Homes USA, Inc. We have
determined that separate, full financial statements of the
guarantors would not be material to investors and, accordingly,
supplemental financial information for the guarantors is
presented ($ in thousands).
Beazer
Homes USA, Inc.
Consolidating
Balance Sheet Information
September 30,
2011
Beazer
Homes USA, Inc.
Consolidating Balance Sheet Information September 30, 2010
Beazer
Homes USA, Inc.
Consolidating
Statement of Operations Information
Fiscal
Year Ended September 30, 2011
Beazer
Homes USA, Inc.
Consolidating
Statement of Operations Information
Fiscal
Year Ended September 30, 2010
Beazer
Homes USA, Inc.
Consolidating
Statement of Operations Information
Fiscal
Year Ended September 30, 2009
Beazer
Homes USA, Inc.
Consolidating
Statement of Cash Flow Information
Beazer
Homes USA, Inc.
Consolidating
Statement of Cash Flow Information
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- Definition
Supplemental Guarantor Information No definition available.
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SEC Settlements
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12 Months Ended | ||||
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Sep. 30, 2011
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SEC Settlements [Abstract] | |||||
SEC Settlements |
On March 3, 2011, Ian McCarthy, the Company’s former
Chief Executive Officer (CEO) and on August 30, 2011, James
O’Leary, the Company’s former Chief Financial Officer,
entered into consent agreements with the Securities and Exchange
Commission (SEC) to resolve potential enforcement actions under
Section 304(a) of the Sarbanes Oxley Act (SOX). The final
judgments with respect to these consents were approved by the
United States District Court of the Northern District of Georgia
on March 28, 2011 and September 27, 2011,
respectively. Section 304 of SOX empowers the SEC to
recover for the benefit of the Company certain incentive
compensation of a CEO
and/or CFO
if the company has restated its financial statements without any
wrongdoing on the part of the CEO or CFO. As previously
disclosed, in May of 2008, the Company restated its financial
statements, covering fiscal years ending September 30, 2002
through 2006 and the first two quarters of fiscal 2007. The SEC
did not allege that either Mr. McCarthy or
Mr. O’Leary were involved in any wrongdoing or had
otherwise violated securities laws. In accordance with the final
judgments and Section 304 of SOX, Mr. McCarthy agreed
to reimburse
the Company for his entire fiscal 2006 incentive bonus, certain
of his stock sale profits and certain 2006 equity grants and
Mr. O’Leary agreed to reimburse the Company for his
entire 2006 incentive bonus. According to his agreement,
Mr. McCarthy paid $6,479,281 in cash to the Company and
returned 57,837 shares of common stock net of shares
previously redeemed for tax withholdings. He also agreed to
forfeit his right to 52,509 shares of unvested restricted
stock. According to his agreement, Mr. O’Leary agreed
to pay $1.4 million in cash to the Company which we
recorded as a receivable as of September 30, 2011. We
received this payment from Mr. O’Leary in October 2011.
With respect to the cash reimbursements, the Company recognized
$7.9 million of income in the fiscal 2011. This amount
represents the amount of compensation expense previously
recognized by the Company. With respect to the stock related to
previously vested awards that were returned by
Mr. McCarthy, the Company recognized income equal to the
value of the stock at the date of return. Due to the significant
decline in the Company’s stock price, the stock price used
to determine the value of the returned stock was significantly
less than the grant date price of the equity award under which
these shares vested and, therefore, the amount of income
recognized was less than the amount of expense previously
recognized by the Company related to these awards. The Company
recorded approximately $196,000 related to
Mr. McCarthy’s return of 57,837 shares of common
stock during fiscal 2011. With respect to the 52,509 shares
of unvested restricted stock returned by Mr. McCarthy, the
Company recognized approximately $245,000 which is equal to the
fair value of the shares at the date of return. The income
related to the cash reimbursements, the return of common stock
and the return of the unvested restricted stock is included in
other expense, net in the accompanying consolidated statements
of operations.
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- Definition
SEC Settlements No definition available.
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