Charles Schwab 2011 Annual Report Download - page 110

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THE CHARLES SCHWAB CORPORATION
Notes to Consolidated Financial Statements
(Tabular Amounts in Millions, Except Per Share Data, Option Price Amounts, Ratios, or as Noted)
- 82 -
Employee Stock Purchase Plan
Under the Company’s Employee Stock Purchase Plan (ESPP), eligible employees can purchase shares of CSC’s common
stock using amounts withheld through payroll deductions, subject to limitations. Payroll deductions are accumulated during
six-month offering periods that start each year on February 1st and August 1st. Share purchases are made on the last trading
day of each three-month purchase period within the offering period. The three-month purchase periods end on January 31st,
April 30th, July 31st, and October 31st of each year. The purchase price for each share of common stock is 85% of the fair
market value of the shares on the last trading day of the purchase period. At December 31, 2011, the Company had 45 million
shares reserved for future issuance under the ESPP.
Other Deferred Compensation Plans
The Company sponsors deferred compensation plans for eligible officers and non-employee directors. The Company’s
deferred compensation plan for officers permits participants to defer the receipt of certain cash compensation. The deferred
compensation liability was $128 million and $139 million at December 31, 2011 and 2010, respectively. The Company’s
deferred compensation plan for non-employee directors permits participants to defer receipt of all or a portion of their director
fees and to receive either a grant of stock options, or upon ceasing to serve as a director, the number of shares of CSC’s
common stock that would have resulted from investing the deferred fee amount into CSC’s common stock.
Retirement Plan
Upon completing three months of consecutive service, employees of the Company can participate in the Company’s qualified
retirement plan, the SchwabPlan® Retirement Savings and Investment Plan. The Company may match certain employee
contributions or make additional contributions to this plan at its discretion. The Company’s total contribution expense was
$53 million, $50 million, and $49 million in 2011, 2010, and 2009, respectively.
21. Money Market Mutual Fund Charges
In 2010, the Company decided to cover the net remaining losses recognized by Schwab money market mutual funds as a
result of their investments in a single structured investment vehicle that defaulted in 2008 and recorded a charge of
$132 million.
22. Taxes on Income
The components of income tax expense are as follows:
Year Ended December 31, 2011 2010 2009
Current:
Federal $ 424 $ 326 $ 400
State 52 50 73
Total current 476 376 473
Deferred:
Federal 44 (43) 12
State 8 (8) 4
Total deferred 52 (51) 16
Taxes on income $ 528 $ 325 $ 489