AutoNation 2006 Annual Report Download - page 62
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Table of Contents
As of December 31, 2006, there was $27.3 million of total unrecognized compensation cost related to non-vested stock options,
which is expected to be recognized over a period of four years. The total fair value of shares vested during 2006 was $14.7 million.
Prior to the adoption of SFAS No. 123R, the Company reported all tax benefits resulting from the exercise of common stock options
as operating cash flows in the Company’s Consolidated Statements of Cash Flows. In accordance with SFAS No. 123R, tax benefits
from the exercise of stock options of $18.0 million are reported as financing cash flows in 2006.
The components of the provision for income taxes from continuing operations for the years ended December 31 are as follows:
Current:
Federal $165.7 $180.7 $147.3
State 26.9 31.7 23.6
Federal and state deferred 19.7 30.4 63.3
Change in valuation allowance, net (2.3) 2.1 .5
Adjustments and settlements, net .7 (16.6) (26.3)
Provision for income taxes $ 210.7 $228.3 $208.4
A reconciliation of the provision for income taxes calculated using the statutory federal income tax rate to the Company’s provision
for income taxes from continuing operations for the years ended December 31 is as follows:
Provision for income taxes at statutory rate of 35% $189.7 35.0 $218.8 35.0 $210.5 35.0
Non-deductible expenses 3.2 .6 2.3 .4 2.1 .4
State income taxes, net of federal benefit 19.4 3.6 21.7 3.5 21.6 3.6
212.3 39.2 242.8 38.9 234.2 39.0
Change in valuation allowance, net (2.3) (.4) 2.1 .3 .5 .1
Adjustments and settlements, net .7 .1 (16.6) (2.7) (26.3) (4.4)
Provision for income taxes $ 210.7 38.9 $ 228.3 36.5 $ 208.4 34.7
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