Computer Associates 2009 Annual Report Download - page 101

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defenses in connection with such lawsuits and claims, and intends to vigorously contest each of them. In the opinion of
the Company’s management, the results of these other lawsuits and claims, either individually or in the aggregate, are
not expected to have a material adverse effect on the Company’s financial position, results of operations, or cash flows,
although the impact could be material to any individual reporting period.
Note 9 — Income Taxes
The amounts of income (loss) from continuing operations before taxes attributable to domestic and foreign operations
are as follows:
(IN MILLIONS) 2009 2008 2007
YEAR ENDED MARCH 31,
Domestic $ 685 $ 591 $ 111
Foreign 417 217 43
$ 1,102 $ 808 $ 154
Income tax expense (benefit) consists of the following:
(IN MILLIONS) 2009 2008 2007
YEAR ENDED MARCH 31,
Current:
Federal $ 317 $ 203 $ 179
State 14 26
Foreign 119 107 65
450 312 250
Deferred:
Federal (76) 19 (19)
State (10) (6) (25)
Foreign 44 (17) (173)
(42) (4) (217)
Total:
Federal 241 222 160
State 4(4) (19)
Foreign 163 90 (108)
$ 408 $ 308 $ 33
The income tax provision recorded for the fiscal year ended March 31, 2009 includes a net charge of approximately
$22 million, which is primarily attributable to adjustments to uncertain tax positions (including certain refinements of
amounts ascribed to tax positions taken in prior periods), partially offset by the reinstatement of the U.S. Research and
Development Tax Credit and settlement of a U.S. federal income tax audit for the fiscal years 2001 through 2004. As a
result of this settlement, during the first quarter of fiscal year 2009, the Company recognized a tax benefit of
$11 million and a reduction of goodwill by $10 million.
The income tax provision recorded for the fiscal year ended March 31, 2008 included charges of approximately
$26 million associated with certain corporate income tax rate reductions enacted in various non-US tax jurisdictions
(with corresponding impacts on the Company’s net deferred tax assets).
The income tax provision for the fiscal year ended March 31, 2007 included benefits of approximately $23 million
primarily arising from the resolution of certain international and U.S. federal tax liabilities.
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