Buffalo Wild Wings 2009 Annual Report Download - page 88

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BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 27, 2009 and December 28, 2008
(Dollar amounts in thousands, except per-share amounts)
Deferred tax assets and liabilities are classified as current and noncurrent on the basis of the classification of the related asset or
liability for financial reporting. Deferred income taxes are provided for temporary differences between the basis of assets and
liabilities for financial reporting purposes and income tax purposes. A valuation allowance is established when it is more likely than
not that some portion of deferred tax assets will not be realized. Since we believe sufficient future taxable income will be generated to
utilize the benefits of the deferred tax assets, a valuation allowance has not been recognized. Temporary differences comprising the
net deferred tax assets and liabilities on the accompanying consolidated balance sheets are as follows:
Fiscal Years Ended
December 27,
2009
December 28,
2008
Deferred tax assets:
Unearned franchise fees $ 1,028 974
Accrued vacation 372 314
Accrued compensation 1,509 715
Deferred lease credits 1,992 1,716
Restricted stock units 1,362 404
Other 839 609
$ 7,102 4,732
Deferred tax liability:
Depreciation $ 18,736 11,780
Goodwill 368 137
Total $ 19,104 11,917
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Balance at December 28, 2008 $ 442
Additions based on tax positions related to the current year 170
Reductions for tax positions of prior years (46)
Balance at December 27, 2009 $ 566
We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. During 2009, 2008, and
2007, interest and penalties of $24, $26, and ($53), respectively, were included in income tax expense. As of December 27, 2009, and
December 28, 2008, interest and penalties related to unrecognized tax benefits totaled $89, and $114, respectively. Included in the
balance at December 27, 2009, and December 28, 2008, are unrecognized tax benefits of $368, and $287, respectively, which if
recognized, would affect the annual effective tax rate. The difference between these amounts and the amount reflected in the
reconciliation above relates to the deferred U.S. federal income tax benefit on unrecognized tax benefits related to U.S. state income
taxes.
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Source: BUFFALO WILD WINGS INC, 10-K, February 26, 2010 Powered by Morningstar® Document Research℠