Here is a link to the COST earnings for the quarter. Sames store sales rose 5% over last year. there was a 8 cent per share writedown on "deferred membership revenue liability" .  I have no idea what this means, any thoughts? Please post here.

• The current period's results were hurt by a one-time charge of $35.8 million, or 8 cents per share, to increase the company's deferred membership revenue liability.

Here's the whole story

http://biz.yahoo.com/ap/071010/earns_costco_wholesale.html?.v=1 

Danny,

Here's what the news release said:

The fiscal year 2007 fourth quarter results were negatively affected by a non-recurring, non-cash pre-tax charge of $56.2 million ($35.8 million, or $.08 per share, after-tax) to increase the Company's deferred membership revenue liability (and reduce membership fee revenue). Excluding this charge, fourth quarter net income would have been $408.2 million, or $.91 per share, representing a 21% increase over last year's fourth quarter earnings.

According to Costco's Chief Financial Officer, Richard Galanti, "Historically, membership fee revenue was recognized using a 'monthly' convention starting from the month the membership payment was received. We are now recognizing membership fees using a 'daily' convention, based on the specific membership terms and timing of payments. The net cash flow effect to the Company is slightly positive, due to a reduction of current income taxes payable of approximately $20 million."

The market appears to be very happy with the results.  As a shareholder, I'm happy too!