Autodesk 2014 Annual Report Download - page 122

2013 Annual Report
2014 Form 10-K 48
Interest and Other (Expense) Income, Net
The following table sets forth the components of interest and other income, net:
Fiscal Year Ended
January 31,
2014 2013 2012
(in millions)
Interest and investment (expense) income, net (1) $ (9.8) $ 4.9 $ 5.4
Gain (loss) on foreign currency 4.0 1.2 (1.1)
(Loss) gain on strategic investments (1) (1.8) (4.0) 0.3
Other income 2.7 2.0 2.7
Interest and other (expense) income, net $ (4.9) $ 4.1 $ 7.3
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(1) For comparability, the presentation of the balances at January 31, 2012 was adjusted to align to current year presentation.
Interest and other (expense) income, net, decreased $9.0 million during fiscal 2014, as compared to fiscal 2013, primarily
due to a reduction in our net interest and investment (expense) income.
The decrease in interest and investment (expense) income, net, during fiscal 2014 as compared to fiscal 2013 is primarily
due to interest expense resulting from the December 2012 issuance of $400.0 million aggregate principal amount of 1.95%
senior notes due December 15, 2017 and $350.0 million aggregate principal amount of 3.6% senior notes due December 15,
2022. Interest and investment income fluctuates based on average cash, marketable securities and debt balances, average
maturities and interest rates.
Interest and other income, net, decreased $3.2 million during fiscal 2013, as compared to fiscal 2012, primarily due to a
reduction in our net interest and investment income and losses incurred due to impairments of certain strategic investments. A
loss on strategic investments occurs when a net reduction in valuation occurs or an impairment is recorded. Impairment results
from the determination that the value of the investment is no longer recoverable.
Provision for Income Taxes
We account for income taxes and the related accounts under the liability method. Deferred tax liabilities and assets are
determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted rates
expected to be in effect during the year in which the basis differences reverse.
Our effective tax rate was 18% and 20% during fiscal 2014 and fiscal 2013, respectively. Our effective tax rate decreased
two percentage points from fiscal 2013 to fiscal 2014 due to an increase in tax benefits from foreign earnings taxed at different
rates in fiscal 2014 compared to fiscal 2013, offset in part by lower tax benefits from restructuring and additional tax expense
associated with uncertain tax positions and audit assessements.
Our effective tax rate was 20% and 21% during fiscal 2013 and 2012, respectively. Our effective tax rate decreased one
percentage point from fiscal 2012 to fiscal 2013 primarily due to an increase in tax benefits from foreign earnings taxed at
lower rates in fiscal 2013 compared to fiscal 2012, partially offset by tax benefits associated with closure of audits in fiscal
2011.
Our future effective tax rate may be materially impacted by the amount of benefits and charges from tax amounts
associated with our foreign earnings that are taxed at rates different from the federal statutory rate, research credits, state
income taxes, the tax impact of stock-based compensation, accounting for uncertain tax positions, business combinations, U.S.
Manufacturer's deduction, closure of statute of limitations or settlement of tax audits, changes in valuation allowances and
changes in tax laws including possible U.S. tax law changes that, if enacted, could significantly impact how U.S. multinational
companies are taxed on foreign subsidiary earnings. A significant amount of our earnings is generated by our Europe and Asia
Pacific subsidiaries. Our future effective tax rates may be adversely affected to the extent earnings are lower than anticipated in
countries where we have lower statutory tax rates or we repatriate certain foreign earnings on which U.S. taxes have not
previously been provided.