401k Plan
Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
 
FORM 11-K
 
 
 
x
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended February 2, 2013
OR
 
¬
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission file number 1-11084
 
 
 
A.
Full title of the plan and the address of the plan, if different from that of the issuer named below:
Kohl's Department Stores, Inc.
Savings Plan
 
B.
Name of the issuer of the securities held pursuant to the plan and the address of its principal executive office:
Kohl's Corporation
N56 W17000 Ridgewood Drive
Menomonee Falls, WI 53051
 






Table of Contents

Kohl's Department Stores, Inc. Savings Plan
 
February 2, 2013 and January 28, 2012
Contents
 
 
Financial Statements
 
          Notes to Financial Statements
 
 
Supplemental Schedule
 
 
 
Exhibit 23.1 Consent of Registered Public Accounting Firm
 





Table of Contents


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUTING FIRM


To The Plan Administrator
Kohl's Department Stores, Inc. Savings Plan
Menomonee Falls, Wisconsin

We have audited the accompanying statements of assets available for benefits of Kohl's Department Stores, Inc. Savings Plan (the “Plan”) as of February 2, 2013 and January 28, 2012, and the related statement of changes in assets available for benefits for the year ended February 2, 2013. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the assets available for benefits of the Plan as of February 2, 2013 and January 28, 2012, and the changes in assets available for benefits for the year ended February 2, 2013, in conformity with accounting principles generally accepted in the United States of America.

Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule, as listed in the Table of Contents, is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is supplementary information required by Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.


/s/ Baker Tilly Virchow Krause, LLP


Milwaukee, Wisconsin
July 24, 2013


1

Table of Contents


Kohl's Department Stores, Inc. Savings Plan
Statements of Assets Available for Benefits

 
 
February 2, 2013
 
January 28, 2012
Cash
 
$
176,122

 
$
34,634

Investments, at fair value
762,444,245

 
647,118,510

Receivables
 
 
 
 
Company contribution
301,565

 
1,241,328

 
Participants' contributions
552,403

 
2,173,966

 
Notes receivable from participants
23,664,118

 
20,585,789

Assets available for benefits - at fair value
787,138,453

 
671,154,227

Adjustment from fair value to contract value for interest in collective trust fund relating to fully benefit-responsive investment contracts
(2,441,533
)
 
(2,679,995
)
Total assets available for benefits
$
784,696,920

 
$
668,474,232


See accompanying notes to financial statements.

2

Table of Contents


Kohl's Department Stores, Inc. Savings Plan
Statement of Changes in Assets Available for Benefits
Year Ended February 2, 2013

Additions:
 

 
Contributions:

 
     Company
$
38,875,908

 
     Participants
60,990,436
 
     Rollovers
4,906,208
 
Total contributions
104,772,552
 
Net realized and unrealized appreciation in fair value of investments
66,211,716
 
Interest income on notes receivable from participants
712,140
 
Interest and dividend income from investments
13,646,402
Total additions
185,342,810
 
 
 
Deductions:
 

 Benefit and withdrawal payments
(69,120,122)
Net increase in assets available for benefits
116,222,688
Assets available for benefits at beginning of year
668,474,232
Assets available for benefits at end of year
$
784,696,920


See accompanying notes to financial statements.


3

Table of Contents
Kohl's Department Stores Inc. Savings Plan
Notes to Financial Statements
February 2, 2013 and January 28, 2012




1. Description of Plan
The Kohl's Department Stores, Inc. Savings Plan (the "Plan") is a defined-contribution plan covering all full-time and part-time employees of Kohl's Department Stores, Inc. (the "Company"), a wholly-owned subsidiary of Kohl's Corporation. All full-time employees are eligible to participate when they are hired and part-time employees are eligible to participate once they reach 1,000 hours of service in any calendar year. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Participants should refer to the Plan agreement for more complete information.

Participants may borrow up to $50,000 from their fund accounts, not to exceed 50% of their vested account balance. Loan terms may be up to five years, or longer if the loan proceeds are applied to the purchase of a principal residence. The loans are secured by the vested balance in the participant's account and bear interest at a rate equal to the Prime Rate as listed in the Wall Street Journal on the first business day of the month in which the loan is taken and range from 3.25% to 7.75%. Principal and interest are repaid in substantially equal installments through deductions from each paycheck beginning with the first payroll following loan issuance.

The Plan includes a non-leveraged employee stock ownership plan (the "ESOP") within the meaning of Internal Revenue Code(the "Code") Section 4975(e)(7). The ESOP is maintained as part of the Plan and is designed to invest primarily in the Company’s common stock. The purpose of the ESOP is to provide participants with the option of having dividends on the Company’s common stock re-invested in the Plan or paid directly to them in cash.

Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100% vested in their accounts.

2. Summary of Significant Accounting Policies
Valuation of Investments and Investment Income
The Plan's investments are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Refer to Note 4, Investments, for details on inputs, valuation techniques and fair value measurement level within the fair value hierarchy.
Net appreciation or depreciation of investments included in the accompanying statement of changes in assets available for benefits includes realized gains or losses from the sale of investments and unrealized appreciation or depreciation in the fair value of investments. The net realized gains or losses on the sale of investments represents the difference between the sale proceeds and the fair value of the investment as of the beginning of the period or the cost of the investment if purchased during the year. Net unrealized appreciation or depreciation in the fair value of investments represents the net change in the fair value of the investments held during the period.
The Plan invests in pooled separate accounts that determine their fair value using the net asset value (“NAV”) of the funds. The NAV is determined by each fund's trustee using the fair value of the underlying securities within the fund at year end.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis and dividends are recorded on the ex-dividend date.
Investment Options
The Plan is intended to satisfy the requirements under Section 404(c) of ERISA and, therefore, provides that participants may choose to direct their contributions and/or all or part of their account balances among any of the Plan's various investment alternatives. Participant contributions in Kohl's Corporation common stock are limited to 25% of a participant's total contribution amount.

4

Table of Contents
Kohl's Department Stores Inc. Savings Plan
Notes to Financial Statements
February 2, 2013 and January 28, 2012



Contributions
Contributions from the Company are accrued for in accordance with the terms of the Plan and are made in cash. Participant contributions are recorded in the period the Company makes corresponding payroll deductions.
Expenses

Expenses related to the administration of the Plan are paid by the Company.
Plan Year

The Plan's fiscal year ends on the Saturday closest to January 31. Fiscal 2012 ended on February 2, 2013 and fiscal 2011 ended on January 28, 2012. The retail calendar for fiscal January 2012 included a fifth week, resulting in a 53-week year in Fiscal 2012.
Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts in the financial statements. Actual results could differ from those estimates.
Payment of Benefits

Benefits are recorded when paid.
Risks and Uncertainties

The Plan invests in various investment securities. Investment securities are exposed to various risks such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the Statements of Assets Available for Benefits.
Notes Receivable from Participants

Notes receivable from participants are segregated from plan investments and measured at their unpaid principal balance plus any accrued but unpaid interest, which approximates fair value.

3. Contributions and Benefit and Withdrawal Payments
Eligible participants may make voluntary tax-deferred contributions up to a total of 100% of their base compensation (as defined), subject to certain statutory limits. Participant contributions made with tax-deferred dollars under Section 401(k) of the Internal Revenue Code (“IRC”) are excluded from the participant's current wages for federal income tax purposes. No federal income tax is paid on the tax-deferred contributions and growth thereon until the participant withdraws them from the Plan. The participant's contribution rate may be adjusted at the discretion of the plan administrator if a reduced rate is necessary to maintain Section  401(k) benefits. The Company's matching contribution is equal to 100% of each participant's contribution, up to a maximum of 5% of the participant's base compensation. The Plan also provides for additional Company contributions based on the discretion of the Company's Board of Directors. There were no additional discretionary Company contributions during the year ended February 2, 2013.
Company contributions made after January 30, 2010 vest immediately. Company contributions made before January 30, 2010 are 100% vested after three years of credited service, as defined by the Plan.



5

Table of Contents
Kohl's Department Stores Inc. Savings Plan
Notes to Financial Statements
February 2, 2013 and January 28, 2012



Subject to the terms of the Plan, upon termination, the non-vested portion of any participant account is generally forfeited and applied to reduce future Company contributions. Forfeitures used to reduce contributions totaled $285 thousand for the year ended February 2, 2013 and $1.2 million for the year ended January 28, 2012. Unallocated forfeitures, which were used to reduce Company contributions in the following year, totaled $31 thousand as of February 2, 2013 and $114 thousand as of January 28, 2012.
Vested benefits for retired participants and permanently disabled participants are distributed, at the discretion of the participant, in a lump-sum payment or in periodic equal installments over a period not exceeding the lesser of ten years or the life expectancy of the participant. Vested benefits for terminated participants and deceased participants are distributed in a lump-sum payment.
Upon substantial financial hardship (as defined in the plan), participants may withdraw any portion of the balance in their account, which is attributable to their voluntary tax-deferred contributions and earnings. Participants are prohibited from making contributions to the Plan for six months following receipt of a hardship withdrawal.
4. Investments
The Plan's investments are valued as follows:
Kohl's Corporation Common Stock is valued at fair value based on the closing price reported in an active market where such shares are traded.

Mutual Funds are valued at fair value based on the net asset value of the fund.

Common Collective Trust Index Funds are valued at fair value based on the net asset values of the funds. The objective of these funds is to track the performance of a benchmark index. The Vanguard Total International Stock Index Fund measures the investment return of stocks issued by companies located in developed and emerging markets, excluding the United States. The Vanguard Institutional Index Fund measures the investment return of large-capitalization stocks in the United States.

The Common Collective Trust Fund is valued at the unit value, as reported by the fund manager, based on the fair value of the underlying investments. The objective of the Putnam Stable Value Fund, the Plan's only Common Collective Trust Fund investment, is to deliver intermediate bond like returns with money market liquidity. In determining assets available for benefits, the Common Collective Trust Fund is recorded at contract value. Contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the plan and represents contributions under the contract, plus earnings (accrued interest), less participant withdrawals and administrative expenses.

The Plan's investments are classified into one of the following fair value measurement categories:

Level 1 - Securities valued using quoted prices from active markets for identical assets

Level 2 - Securities not traded on an active market but for which there are readily available observable market inputs that are corroborated by market data

Level 3 - Unobservable inputs that are not corroborated by market data

Investments are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.


6

Table of Contents
Kohl's Department Stores Inc. Savings Plan
Notes to Financial Statements
February 2, 2013 and January 28, 2012



The following table sets forth the fair value classification of the Plan's investments:
 
 
February 2, 2013
 
January 28, 2012
 
 
Level 1
 
Level 2
 
Total
 
Kohl's Common Stock
$
57,183,363

 

 
$
57,183,363

 
$
56,694,708

Common Collective
 
 
 
 
 
 
 
 
Trust Fund

 
$
81,455,554

 
81,455,554

 
81,503,351

Common Collective
 
 
 
 
 
 
 
 
Trust Index Fund

 
60,273,117

 
60,273,117

 
49,537,204

Mutual Funds:
 
 
 
 
 
 
 
 
Age Based
247,557,711

 

 
247,557,711

 
187,188,404

 
Large Cap Growth
79,649,027

 

 
79,649,027

 
70,735,792

 
Global
62,593,424

 

 
62,593,424

 
54,856,401

 
Balanced
47,444,812

 

 
47,444,812

 
42,723,020

 
Fixed Income
53,017,283

 

 
53,017,283

 
47,339,995

 
Large Cap Value
40,140,853

 

 
40,140,853

 
31,842,975

 
Small Cap Blend
24,774,461

 

 
24,774,461

 
19,638,144

 
Mid Cap Blend
8,354,640

 

 
8,354,640

 
5,058,516

     Total Mutual Funds
563,532,211

 

 
563,532,211

 
459,383,247

Total Investments
$
620,715,574

 
$
141,728,671

 
$
762,444,245

 
$
647,118,510


There have been no transfers of investments between levels in fiscal years 2012 and 2011.

During the year ended February 2, 2013, the Plan's investments, including investments purchased, sold, and held, appreciated (depreciated) in fair value as determined by quoted redemption or market prices as follows:

Kohl's Corporation common stock
$
(696,545
)
Common collective trust index fund
7,569,256

Mutual funds
59,339,005

 
$
66,211,716


The fair values of investments representing 5% or more of the Plan's assets are as follows:
 
February 2, 2013
 
January 28, 2012
SSGA Target Retirement Portfolio
$
247,557,711

 
$
187,188,404

Putnam Stable Value Fund
81,455,554

 
81,503,351

American Funds Europacific Growth Fund
62,593,424

 
54,856,401

Kohl's Corporation Common Stock*
57,183,363

 
56,694,708

Vanguard Institutional Index Fund
58,985,081

 
49,416,682

T. Rowe Price Balanced Fund
47,444,812

 
42,723,020

PIMCO Total Return Fund
45,001,265

 
40,307,029

Harbor Appreciation Fund
79,649,027

 
70,735,792

Dodge & Cox Stock Fund
40,140,853

 
31,842,975

 
 
 
 
* Indicates party in interest to the Plan
 
 
 

7

Table of Contents
Kohl's Department Stores Inc. Savings Plan
Notes to Financial Statements
February 2, 2013 and January 28, 2012




Common Collective Trust Fund

The Putnam Stable Value Fund, a common collective trust fund, invests in guaranteed investment contracts ("GICs") and similar contracts issued by insurance companies, banks and other financial institutions. This fund invests up to 75% of its assets in security-backed investment contracts (“SBIC's”), including separate account products of insurance companies, and at least 5% of its assets in money-market, cash, cash equivalents and stable value funds. The Putnam Stable Value Fund primarily holds investments in fully benefit-responsive insurance contracts that provide that the Plan may make withdrawals at contract value for benefit-responsive requirements.

The interest crediting rate is the periodic interest rate accrued to participants and is either set at the beginning of the contract and held constant, or reset periodically to reflect the performance of the underlying securities. Variables impacting future crediting rates include current yield and duration of the assets backing the contracts, existing differences between the market values of assets backing the contracts and the contract values of the contracts.

Participants may ordinarily direct the withdrawal or transfer of all or a portion of their investment in the Putnam Stable Value Fund at contract value. Certain events may limit the ability of the Plan to transact at contract value with the issuer. The plan administrator does not believe that the occurrence of any such event is probable. The average yield and crediting interest rates were approximately two percent for the year ended February 2, 2013 and approximately three percent for the year ended January 28, 2012.

The table below reconciles the fair value and the contract value of the Common Collective Trust Fund:

 
February 2, 2013
 
January 28, 2012
Fair Value
$
81,455,554

 
$
81,503,351

Adjustment to contract value
(2,441,533
)
 
(2,679,995
)
Contract Value
$
79,014,021

 
$
78,823,356


5. Amount Owed to Participants Withdrawing from the Plan
There were no amounts owed to participants who have withdrawn from the Plan as of February 2, 2013 or January 28, 2012.
6. Income Tax Status
The Plan has received a determination letter from the Internal Revenue Service dated January 31, 2012, stating that the Plan is qualified under Section 401(a) of the IRC and, therefore, the related trust is exempt from taxation. The plan is required to operate in conformity with the IRC to maintain its qualification.  The plan administrator is not aware of any events that have occurred that might adversely affect the plan's qualified status.

U.S. generally accepted accounting principles require Plan management to evaluate tax positions taken by the Plan. The financial statement effects of a tax position are recognized when the position is more likely than not, based on the technical merits, to be sustained upon examination by the IRS. The Plan Administrator has analyzed the tax positions taken by the Plan, and has concluded that as of February 2, 2013 and January 28, 2012, there are no uncertain positions taken or expected to be taken. The Plan has recognized no interest or penalties related to uncertain tax positions. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes the Plan is no longer subject to income tax examinations for tax returns filed in years prior to 2009.



8

Table of Contents
Kohl's Department Stores Inc. Savings Plan
Notes to Financial Statements
February 2, 2013 and January 28, 2012



7. Transactions With Parties-in-Interest
During fiscal 2012, the Plan purchased and sold Kohl's Corporation common stock as indicated in the following table. Such purchases and sales were made at the market price for the stock on the respective dates.
 
Purchases
 
Sales
Amount
$
11,670,158

 
$
10,484,958

Number of Shares
243,656

 
215,089


During fiscal 2012, dividend income of $1.6 million ($1.28 per share of Kohl's Corporation common stock) was used to purchase 33,262 shares of Kohl's Corporation stock.


8. Reconciliation of Financial Statements to Schedule H Form 5500
The following is a reconciliation of the assets available for benefits as reported in the financial statements to the assets as reported on the 2012 Form 5500, Schedule H, Part I:

 
February 2, 2013
 
January 28, 2012
Assets available for benefits as reported in the financial statements
$
784,696,920

 
$
668,474,232

Adjustment to fair value from contract value for investment relating to fully benefit-responsive investment contracts
2,441,533

 
2,679,995

Net income as reported on Form 5500
$
787,138,453

 
$
671,154,227


The following is a reconciliation of the net increase in assets available for benefits as reported in the 2012 financial statements to the net income as reported on the 2012 Form 5500, Schedule H, Part II:
Net increase in assets available for benefits as reported in the financial statements
$
116,222,688

Change in adjustment to fair value from contract value for investment relating to fully benefit-responsive investment contracts
(238,462
)
Net income as reported on Form 5500
$
115,984,226





9








SUPPLEMENTAL SCHEDULE


Table of Contents
Kohl's Department Stores, Inc. Savings Plan

Employer Identification Number 13-3357362
Plan Number 002
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
February 2, 2013

(a) Parties in interest to the Plan
 
(b)


Identity of Issue, Borrower, Lessor or Similar Party
 
(d)

 Cost
 
(e)


Current Value
*
 
Kohl's Corporation Common Stock
 
**
 
$
57,183,363

 
 
Mutual Funds:
 
 
 
 
 
 
 
American Funds Europacific Growth Fund
 
**
 
62,593,424

 
 
 
Dodge & Cox Stock Fund
 
**
 
40,140,853

 
 
 
Blackrock Inflation Protected Bond Institution
 
**
 
8,016,018

 
 
 
JPMorgan Mid Cap Equity Select
 
**
 
8,354,640

 
 
 
PIMCO Total Return Fund
 
**
 
45,001,265

 
 
 
T. Rowe Price Small Cap Stock Fund
 
**
 
24,774,461

 
 
 
T. Rowe Price Balanced Fund
 
**
 
47,444,812

 
 
 
Harbor Appreciation Fund
 
**
 
79,649,027

 
 
 
SSGA Target Retirement Income Strategy
 
**
 
4,485,528

 
 
 
SSGA Target Retirement 2010 Strategy
 
**
 
6,207,719

 
 
 
SSGA Target Retirement 2015 Strategy
 
**
 
18,933,697

 
 
 
SSGA Target Retirement 2020 Strategy
 
**
 
27,786,600

 
 
 
SSGA Target Retirement 2025 Strategy
 
**
 
33,632,038

 
 
 
SSGA Target Retirement 2030 Strategy
 
**
 
34,328,600

 
 
 
SSGA Target Retirement 2035 Strategy
 
**
 
32,443,658

 
 
 
SSGA Target Retirement 2040 Strategy
 
**
 
29,353,508

 
 
 
SSGA Target Retirement 2045 Strategy
 
**
 
29,647,633

 
 
 
SSGA Target Retirement 2050 Strategy
 
**
 
30,738,730

 
 
Common Collective Trust Index Fund:
 
 
 
 
 
 
 
Vanguard Total International Stock Index Fund
 
**
 
1,288,036

 
 
 
Vanguard Institutional Index Fund
 
**
 
58,985,081

 
 
Common Collective Trust Fund:
 
 
 
 
 
 
 
Putnam Stable Value Fund
 
**
 
81,455,554

*
 
Notes Receivable from Participants, interest ranges from 3.25 - 7.75%; Maturities through 2023
 
-0-
 
23,664,118

 
 
 
 
 
 
 
$
786,108,363

* Indicates party in interest to the Plan
** Cost omitted for participant direct funds

10

Table of Contents

SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed by the undersigned thereunto duly authorized.

KOHL'S DEPARTMENT STORES, INC. SAVINGS PLAN


/s/ Wesley S. McDonald
Wesley S. McDonald
Senior Executive Vice President,
Chief Financial Officer,
On behalf of Kohl's Corporation as Plan Administrator
Date: July 24, 2013



11
Exhibit 23.1 (401k)


Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in the Registration Statement No. 33-84558 of Kohl's Corporation on Form S-8 of our report dated July 24, 2013, appearing in this Annual Report on Form 11-K of Kohl's Department Store, Inc. Savings Plan for the year ended February 2, 2013.
/s/ Baker Tilly Virchow Krause, LLP
Milwaukee, Wisconsin
July 24, 2013