Cemex 2009 Annual Report Download - page 70

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Information related to other postretirement benefits
In some countries, CEMEX has established health care benefits for retired personnel limited to a certain number of years after retirement. As of
December 31, 2009 and 2008, the PBO related to these benefits was approximately $1,247 and $1,116, respectively. The medical inflation rate used in 2009
to determine the PBO of these benefits was 7% in Mexico, 3% in Puerto Rico, 4% in the United States and 7% in the United Kingdom.
Other employee benefits
In addition, in some countries, CEMEX has self-insured health care benefits plans for its active employees, which are managed on cost plus fee arrangements
with major insurance companies or provided through health maintenance organizations. As of December 31, 2009 and 2008, in certain plans, CEMEX has
established stop-loss limits for continued medical assistance derived from a specific cause (e.g., an automobile accident, illness, etc.) ranging from US$23
thousand to US$400 thousand. In other plans, CEMEX has established stop-loss limits per employee regardless of the number of events ranging from
US$350 thousand to US$2. If all employees qualifying for health care benefits required medical services simultaneously, the contingency for CEMEX would
be significantly larger. However, this scenario, while possible, is remote. The amount expensed for the years ended December 31, 2009, 2008 and 2007
through self-insured health care benefits was approximately US$106 ($1,442), US$100 ($1,126) and US$99 ($1,081), respectively.
16. INCOME TAXES
A) Income taxes
As mentioned in note 3N, CEMEX determines current and deferred income taxes. The amounts for income taxes included in the income statement for the
years ended December 31, 2009, 2008 and 2007 are summarized as follows:
2009 2008 2007
Current income taxes
From Mexican operations $ (3,804) (2,793) (1,649)
From foreign operations (4,885) (5,180) (3,161)
(8,689) (7,973) (4,810)
Deferred income taxes
From Mexican operations 2,181 5,990 (357)
From foreign operations 17,074 24,981 693
19,255 30,971 336
$ 10,566 22,998 (4,474)
As of December 31, 2009, consolidated tax loss and tax credits carryforwards expired as follows:
Amount of
carryforwards
2010 $ 18,456
2011 22,105
2012 29,639
2013 53,425
2014 and thereafter 149,164
$ 272,789
In connection with changes to the tax consolidation regime in Mexico (note 3N) and based on Interpretation 18, CEMEX recognized a liability for
approximately $10,461 against “Other non-current assets” for approximately $8,216 in connection with the net liability recognized before the new tax
law, and approximately $2,245 against “Retained earnings,” for the portion, according to the new law, related to: a) the difference between the sum of
the equity of the controlled entities for tax purposes and the equity for tax purposes of the consolidated entity; b) dividends from the controlled entities for
tax purposes to CEMEX, S.A.B. de C.V.; and c) other transactions between the companies included in the tax consolidation that represented the transfer of
resources within the group.
B) Deferred income taxes
Deferred income taxes for the period represent the difference between the balances of deferred income at the beginning and the end of the period.
Deferred income tax assets and liabilities relating to different tax jurisdictions are not offset. As of December 31, 2009 and 2008, the income tax effects of
the main temporary differences that generated the consolidated deferred income tax assets and liabilities are presented below:
2009 2008
Deferred tax assets:
Tax loss carryforwards and other tax credits 1 $ 77,602 55,488
Accounts payable and accrued expenses 8,197 11,708
Deferred charges, net 2,779 6,802
Others 1,202 688
Total deferred tax assets 89,780 74,686
Less – Valuation allowance (32,079) (27,194)
Net deferred tax assets 57,701 47,492
Deferred tax liabilities:
Property, machinery and equipment (50,582) (53,067)
Investments and other assets (1,960) (8,195)
Deferred credits – (2,199)
Others (1,050) (1,178)
Total deferred tax liabilities (53,592) (64,639)
Net deferred tax asset (liability) $ 4,109 (17,147)