Danaher 2011 Annual Report Download - page 62

Table of Contents
impact of tax planning strategies, and can also be impacted by changes to tax laws. Deferred tax liabilities generally represent items that have already been
taken as a deduction on the Company’s tax return but have not yet been recognized as an expense in the Company’s Consolidated Statements of Earnings. The
effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income tax expense in the period that includes the enactment date.
The Company accounts for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits,
it is “more-likely-than-not” that the position will be sustained upon examination. Judgment is required in evaluating tax positions and determining income tax
provisions. The Company generally re-evaluates the technical merits of its tax positions and recognizes an uncertain tax benefit when: (i) there is completion of
tax audit; (ii) there is a change in applicable tax law including a tax case ruling or legislative guidance; or (iii) there is an expiration of the statute of limitations.
An increase in our nominal tax rate of 1.0% would have resulted in an additional income tax provision for the fiscal year ended December 31, 2011 of
approximately $25 million.
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In September 2011, updated accounting guidance was issued requiring additional disclosures about an employer’s participation in multiemployer retirement
benefit plans. The amended disclosures, which are to be applied retrospectively for all prior periods presented, are effective for annual periods for fiscal years
ending after December 15, 2011, with early adoption permitted. As the new guidance is related to disclosure only, the adoption of this guidance did not have a
material effect on the Company’s results of operations, financial position or cash flows.
In September 2011, updated accounting guidance was issued which allows entities to perform a qualitative assessment on goodwill impairment to determine
whether it is more likely than not (defined as having a likelihood of more than 50 percent) that the fair value of a reporting unit is less than its carrying amount
as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. This guidance is effective for goodwill impairment tests
performed in interim and annual periods for fiscal years beginning after December 15, 2011, with early adoption permitted. The implementation of this
guidance is not expected to have a material impact on the Company’s results of operations, financial position or cash flows.
In June 2011, updated accounting guidance was issued which requires entities to present comprehensive income, which is currently presented in the
Consolidated Statement of Stockholders’ Equity, either as a single continuous statement of comprehensive income or as two separate but consecutive
statements. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2011, with early adoption
permitted. As this new guidance is related to presentation only, the implementation in the first quarter of fiscal year 2012 will not have a material impact on the
Company’s results of operations, financial position or cash flows.
In May 2011, updated accounting guidance was issued as a result of joint efforts by the Financial Accounting Standards Board and the International
Accounting Standards Board to develop a single, converged fair value framework on how to measure fair value and on what disclosures to provide about fair
value measurements. The guidance is largely consistent with existing fair value measurement principles and is effective during interim and annual periods
beginning after December 15, 2011. The Company’s adoption of this guidance in the first quarter of fiscal year 2012 will not have a material impact on the
Company’s results of operations, financial position or cash flows.
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The information required by this item is included under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
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Source: DANAHER CORP /DE/, 10-K, February 24, 2012 Powered by Morningstar® Document Research℠
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