Google 2014 Annual Report Download - page 35


Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

statutory rates and higher than anticipated in countries that have higher statutory rates, the net gains and losses recognized
by legal entities on certain hedges and related hedged intercompany and other transactions under our foreign exchange risk
management program, changes in the valuation of our deferred tax assets or liabilities, or changes in tax laws, regulations, or
accounting principles, as well as certain discrete items.
We are subject to the continuous examination of our income tax returns by the Internal Revenue Service (IRS) and other domestic
and foreign tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to determine
the adequacy of our provision for income taxes. We continue to monitor the progress of ongoing discussions with tax authorities
and the impact, if any, of the expected expiration of the statute of limitations in various taxing jurisdictions. Further information
on these issues, the treatment of undistributed foreign earnings and a reconciliation of the federal statutory income tax rate to

See Critical Accounting Policies and Estimates below for additional information about our provision for income taxes.
Net Income (Loss) from Discontinued Operations
Motorola Mobile
On October 29, 2014, we closed the sale of the Motorola Mobile business to Lenovo for a total purchase price of approximately
$2.9 billion (subject to certain adjustments), including $1.4 billion paid at close, comprised of $660 million in cash and
$750million in Lenovo ordinary shares. The remaining $1.5 billion was paid in the form of an interest-free, three-year
prepayable promissory note.
We maintain ownership of the vast majority of the Motorola Mobile patent portfolio, including pre-closing patent applications
and invention disclosures, which we licensed to Motorola Mobile for its continued operations. Additionally, in connection with
the sale, we agreed to indemnify Lenovo for certain potential liabilities of the Motorola Mobile business, for which we recorded
a liability of $130 million as of December 31, 2014.
The sale resulted in a gain of $740 million, net of tax, which was presented as part of net income from discontinued
operations in the Consolidated Statements of Income for the year ended December 31, 2014. Incremental to this net gain,
we recognized an additional income of $254 million, net of tax, in connection with certain IP licensing arrangements between
the parties, included as part of net income from discontinued operations on the Consolidated Statements of Income for
the year ended December 31, 2014.


business included in net income (loss) from discontinued operations for the years ended December 31, 2012, 2013, and
2014 (in millions):
Year Ended December31,
2012 2013 2014(1)
Revenues $ 4,136 $ 4,306 $5,486
Loss from discontinued operations before income taxes (1,083) (1,403) (177)
(Provision for) income taxes 318 270 (47)
Gain on disposal 0 0 740
Net (loss) income from discontinued operations $ (765) $(1,133) $ 516
(1) The operating results of Motorola Mobile were included in our Consolidated Statements of Income from January 1, 2014 through October
29, 2014, the date of divestiture.
Motorola Home
On April 17, 2013, we sold the Motorola Home business to Arris.


included in net income (loss) from discontinued operations for the years ended December 31, 2012 and 2013 (in millions):
29GOOGLE INC.
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