Berkshire Hathaway 2001 Annual Report Download - page 40

39
(11) Borrowings under investment agreements and other debt (Continued)
Borrowings under investment agreements are made pursuant to contracts calling for interest payable, normally
semiannually, at fixed rates ranging from 2.5% to 8.6% per annum. Contractual maturities of borrowings under
investment agreements generally range from 3 months to 30 years. Under certain conditions, these borrowings may be
redeemable prior to the contractual maturity dates.
Other debt includes variable and fixed rate term bonds and notes issued by various of Berkshire subsidiaries.
These obligations generally, are redeemable prior to maturity at the option of the issuing company.
No materially restrictive covenants are included in any of the various debt agreements. Payments of principal
amounts expected during the next five years are as follows (in millions).
2002 2003 2004 2005 2006
$1,835 $53 $40 $415 $98
During the second quarter of 2001, Berkshire filed a shelf registration to issue up to $700 million in new debt
securities at a future date. The intended purpose of the future issuance of debt is to fund the repayment of borrowings of
certain Berkshire subsidiaries. The timing and amount of the debt to be issued under the shelf registration has not yet
been determined.
(12) Income taxes
The liability for income taxes as of December 31, 2001 and 2000 as reflected in the accompanying Consolidated
Balance Sheets is as follows (in millions). 2001 2000
Payable currently ................................................................................. $ (272) $ 522
Deferred ............................................................................................... 7,293 9,603
$7,021 $10,125
The Consolidated Statements of Earnings reflect charges for income taxes as shown below (in millions).
2001 2000 1999
Federal......................................................................................................................... $ 629 $2,136 $ 748
State............................................................................................................................. 68 32 43
Foreign ........................................................................................................................ (77) (150) 61
$ 620 $2,018 $ 852
Current ........................................................................................................................ $ 109 $2,012 $1,189
Deferred ...................................................................................................................... 511 6 (337)
$ 620 $2,018 $ 852
The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred
tax liabilities at December 31, 2001 and 2000 are shown below (in millions).
2001 2000
Deferred tax liabilities:
Relating to unrealized appreciation of investments........................... $7,078 $9,571
Deferred charges reinsurance assumed ............................................. 1,131 916
Investments ....................................................................................... 382 441
Other ................................................................................................. 1,552 717
10,143 11,645
Deferred tax assets:
Unpaid losses and loss adjustment expenses..................................... (752) (1,061)
Unearned premiums .......................................................................... (294) (227)
Other ................................................................................................. (1,804) (754)
(2,850) (2,042)
Net deferred tax liability ...................................................................... $7,293 $9,603