Hasbro 2013 Annual Report Download - page 82

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HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)
The components of deferred income tax expense (benefit) arise from various temporary differences and
relate to items included in the consolidated statements of operations as well as items recognized in other
comprehensive earnings. The tax effects of temporary differences that give rise to significant portions of the
deferred tax assets and liabilities at December 29, 2013 and December 30, 2012 are:
2013 2012
Deferred tax assets:
Accounts receivable ............................................ $ 20,853 21,410
Inventories .................................................... 16,272 15,472
Loss carryforwards ............................................. 27,870 25,083
Operating expenses ............................................. 54,255 46,879
Pension ...................................................... 31,533 49,159
Other compensation ............................................. 46,206 53,611
Postretirement benefits .......................................... 12,873 16,447
Tax sharing agreement .......................................... 24,835 25,510
Other ........................................................ 30,338 31,038
Gross deferred tax assets ....................................... 265,035 284,609
Valuation allowance ............................................ (21,474) (17,145)
Net deferred tax assets ......................................... 243,561 267,464
Deferred tax liabilities:
Depreciation and amortization of long-lived assets .................... 66,856 76,365
Equity method investment ........................................ 18,571 19,967
Other ........................................................ 5,455 7,655
Deferred tax liabilities ......................................... 90,882 103,987
Net deferred income taxes .......................................... $152,679 163,477
Hasbro has a valuation allowance for certain deferred tax assets at December 29, 2013 of $21,474, which is
an increase of $4,329 from $17,145 at December 30, 2012. The valuation allowance pertains to certain U.S. state
and international loss carryforwards, some of which have no expiration and others that would expire beginning in
2015.
Based on Hasbro’s history of taxable income and the anticipation of sufficient taxable income in years when
the temporary differences are expected to become tax deductions, the Company believes that it will realize the
benefit of the deferred tax assets, net of the existing valuation allowance.
At December 29, 2013 and December 30, 2012, the Company’s net deferred income taxes are recorded in
the consolidated balance sheets as follows:
2013 2012
Prepaid expenses and other current assets ............................. $ 86,634 85,429
Other assets ..................................................... 67,773 79,746
Accrued liabilities ................................................ (183) (641)
Other liabilities .................................................. (1,545) (1,057)
Net deferred income taxes .......................................... $152,679 163,477
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