3M 2006 Annual Report Download - page 82

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
the U.S. and International pension benefit plans, respectively, and $218 million for the postretirement health care and
life insurance benefit plan. See Note 11 for additional detail.
Prior to the implementation of SFAS No. 158, a minimum pension liability adjustment would be recognized annually if the
accumulated benefit obligation (ABO) exceeded the fair value of pension assets, which would result in the employer
recognizing a liability that is at least equal to the unfunded ABO. For the year ended December 31, 2004, the change
from a minimum pension liability within accumulated other comprehensive income to a prepaid pension asset
LQFUHDVHGVWRFNKROGHUV¶HTXLW\E\ELOOLon (after-tax). This increase was primarily the result of the assets being in
excess of the accumulated benefit obligation for the U.S. qualified plan, which caused the minimum pension liability
recorded for the years ended December 31, 2003 and 2002 to be reversed. For the year ended December 31, 2005,
the Company was in a prepaid asset position for its U.S. qualified plan.
Income tax effects for cumulative translation are not significant because no tax provision has been made for the
translation of foreign currency financial statements into U.S. dollars. Reclassification adjustments are made to avoid
double counting in comprehensive income items that are also recorded as part of net income. Reclassification
adjustments (other than for cash flow hedging instruments provided in Note 12) were not material.
NOTE 7. Supplemental Cash Flow Information
  
(Millions) 2006 2005 2004
Cash income tax payments $1,842  
Cash interest payments 119  
Capitalized interest 16 12 8
Individual amounts in the Consolidated Statement of Cash Flows exclude the impacts of acquisitions, divestitures and
exchange rate impacts, which are presented VHSDUDWHO\³2WKHU±QHW´LQWKH&onsolidated Statement of Cash Flows
within operating activities in 2006 includes outstanding liabilitieVDW'HFHPEHUUHODWHGWR0¶VUHVWUXFWXULQJ
actions (Note 4). 2005 includes the non-cash impact of adopting FIN 47 ($35 million cumulative effect of accounting
change).
Transactions related to investing and financing activities with significant non-cash components are as follows:
In 2004, 3M purchased 100 percent of the outstanding common shares of HighJump Software Inc., for approximately
$66 million, which included $23 million of cash paid (net of cash acquired) plus 3M common stock that had a fair market
value of $43 million. Refer to Note 2 for additional details related to assets acquired and liabilities assumed from
acquisitions. Dividends declared, but not paid at December 31, 2004, of $34 million were payable to minority interests in
consolidated subsidiaries.
NOTE 8. Income Taxes
  
Income Before Income Taxes, Minority Interest and
Cumulative Effect of Accounting Change
(Millions) 2006 2005 2004
United States $3,191  
International 2,434 2,224 2,314
Total $5,625 $4,828 $4,303
Provision for Income Taxes
(Millions) 2006 2005 2004
Currently payable
Federal $1,087  
State 128 82 (60)
International 824 704 
Deferred
Federal (261) 127 23
State (24) 11 124
International (31)   
Total $1,723 $1,627 $1,400