ADT 2011 Annual Report Download - page 212

TYCO INTERNATIONAL LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
7. Income Taxes (Continued)
interest and penalties related to unrecognized tax benefits as of September 30, 2011, September 24,
2010 and September 25, 2009, respectively.
A rollforward of unrecognized tax benefits as of September 30, 2011, September 24, 2010 and
September 25, 2009 is as follows ($ in millions):
2011 2010 2009
Balance as of beginning of year ....................... $318 $281 $369
Additions based on tax positions related to the current year . . . 15 11 10
Additions based on tax positions related to prior years ....... 39 58 3
Reductions based on tax positions related to prior years ...... (95) (22) (90)
Reductions related to settlements ...................... (5) (6) (4)
Reductions related to lapse of the applicable statute of
limitations ..................................... (6) (1) (6)
Foreign currency translation adjustments ................. 4 (3) (1)
Balance as of end of year ............................ $270 $318 281
Many of Tyco’s uncertain tax positions relate to tax years that remain subject to audit by the taxing
authorities in the U.S. federal, state and local or foreign jurisdictions. Open tax years in significant
jurisdictions are as follows:
Years
Jurisdiction Open To Audit
Australia ............................................. 2004 - 2010
Canada .............................................. 2001 - 2010
Germany ............................................. 1998 - 2010
Italy ................................................. 2004 - 2010
South Korea ........................................... 2006 - 2010
Switzerland ............................................ 2000 - 2010
United Kingdom ........................................ 2000 - 2010
United States .......................................... 1997 - 2010
Based on the current status of its income tax audits, the Company believes that it is reasonably
possible that between nil and $60 million in unrecognized tax benefits may be resolved in the next
twelve months.
Tax Sharing Agreement and Other Income Tax Matters
In connection with the spin-offs of Covidien and TE Connectivity, Tyco entered into a Tax Sharing
Agreement that generally governs Covidien’s, TE Connectivity’s and Tyco’s respective rights,
responsibilities, and obligations after the 2007 Separation with respect to taxes, including ordinary
course of business taxes and taxes, if any, incurred as a result of any failure of the distribution of all of
the shares of Covidien or TE Connectivity to qualify as a tax-free distribution for U.S. federal income
tax purposes within the meaning of Section 355 of the Code or certain internal transactions undertaken
in anticipation of the spin-offs to qualify for tax-favored treatment under the Code.
2011 Financials 109