DIRECTV 2003 Annual Report Download - page 94

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THE DIRECTV GROUP, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (continued)
Income (loss) from continuing operations before income taxes, minority interests and cumulative effect of
accounting changes included the following components:
2003 2002 2001
(Dollars in Millions)
U.S.income(loss)................................................ $ 49.7 $533.2 $(458.0)
Foreign loss ..................................................... (386.0) (570.0) (388.0)
Total .................................................. $(336.3) $ (36.8) $(846.0)
The income tax benefit was different than the amount computed using the U.S. federal statutory income tax
rate for the reasons set forth in the following table:
2003 2002 2001
(Dollars in Millions)
Expected refund at U.S. federal statutory income tax rate ...................... $(117.7) $(12.9) $(296.1)
Resolution of tax contingencies .......................................... (48.0) (98.0) (30.0)
Extraterritorial income exclusion and foreign sales corporation tax benefit ........ (34.8) (34.8) (37.1)
U.S. state and local income tax benefit .................................... (3.3) (1.0) (20.9)
Tax basis differences attributable to equity method investees ................... — — (29.6)
Minority interests in losses of partnership .................................. — — 33.9
Non-deductible goodwill and intangible assets .............................. 20.4 — 46.3
Foreign losses and taxes, net of credits .................................... 34.8 56.2 36.2
Change in valuation allowance .......................................... 69.7 58.6 20.6
Transaction costs and other ............................................. 7.0 4.3 0.8
Total income tax benefit ............................................ $ (71.9) $(27.6) $(275.9)
Temporary differences and carryforwards which gave rise to deferred tax assets and liabilities at
December 31 were as follows:
2003 2002
Deferred
Tax
Assets
Deferred
Tax
Liabilities
Deferred
Tax
Assets
Deferred
Tax
Liabilities
(Dollars in Millions)
Accruals and advances .................................... $ 337.8 $ 43.3 $ 295.9
Prepaidexpenses ......................................... — 225.3 — $ 114.7
State taxes .............................................. 1.4 — — 2.6
GainonPanAmSatmerger ................................. — 171.6 — 171.6
Depreciation and amortization .............................. — 991.3 — 1,068.4
Net operating loss and tax credit carryforwards ................. 805.1 — 353.2 —
Programming contract liabilities ............................. 150.1 — 168.5 —
Unrealized gains and losses on securities ...................... — 177.7 1.4 —
Tax basis differences in investments and affiliates ............... 78.1 323.5 163.9 —
Discontinuation of DIRECTV Broadband business .............. — — 104.1 —
Other .................................................. 186.5 42.4 54.3 134.4
Subtotal ................................................ 1,559.0 1,975.1 1,141.3 1,491.7
Valuation allowance ...................................... (171.5) — (133.1) —
Total deferred taxes ................................... $1,387.5 $1,975.1 $1,008.2 $1,491.7
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