ManpowerGroup 2012 Annual Report Download - page 70

As of December 31, 2012, we have gross unrecognized tax benefits related to various tax jurisdictions, including interest
and penalties, of $28.5. We have related tax benefits of $2.5, and the net amount of $26.0 would favorably affect
the effective tax rate if recognized. We do not expect our unrecognized tax benefits to change significantly over the next
12 months.
As of December 31, 2011, we had gross unrecognized tax benefits related to various tax jurisdictions, including interest and
penalties, of $27.0. We had related tax benefits of $3.6 for a net amount of $23.4.
We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. We accrued net
interest and penalties of $0.1 and $0.6 during 2012 and 2011, respectively. In 2010, we had a net benefit of $1.3 due to a
$1.8 benefit from statute expirations.
The following table summarizes the activity related to our unrecognized tax benefits during 2012, 2011 and 2010:
2012 2011 2010
Gross unrecognized tax benefits, beginning of year $ 25.0 $ 25.0 $ 41.7
Increases in prior year tax positions 5.8 0.9 3.0
Decreases in prior year tax positions (0.8) (1.5) (2.0)
Increases for current year tax positions 3.1 2.5 —
Expiration of statute of limitations and audit settlements (6.7) (1.9) (17.7)
Gross unrecognized tax benefits, end of year $ 26.4 $ 25.0 $ 25.0
Potential interest and penalties 2.1 2.0 1.4
Balance, end of year $ 28.5 $ 27.0 $ 26.4
We conduct business globally in 80 countries and territories. We are routinely audited by the tax authorities of the various
tax jurisdictions in which we operate. Generally, the tax years that could be subject to examination are 2009 through 2011
for our major operations in Germany, Italy, France, Japan, United States and United Kingdom. During 2012, we closed the
United States tax examination for our 2008 and 2009 tax years and as of December 31, 2012, we are subject to tax audits
in France, Germany, Denmark, Austria, Italy, Spain and Norway. We believe that the resolution of these audits will not have
a material impact on earnings.
06.
Goodwill
Changes in the carrying value of goodwill by reportable segment and Corporate were as follows:
Americas(1)
Southern
Europe(2)
Northern
Europe APME Right Management Corporate(3),(4) Total(4)
Balance, January 1, 2011 $465.5 $ 33.1 $265.1 $64.9 $60.6 $64.9 $ 954.1
Goodwill acquired — 26.8 — 13.0 — — 39.8
Currency impact and other (3.7) (0.4) (4.4) (0.4) (0.3) — (9.2)
Balance, December 31, 2011 461.8 59.5 260.7 77.5 60.3 64.9 984.7
Goodwill acquired 4.8 41.4 — — — — 46.2
Currency impact and other 0.5 2.4 10.0 (4.3) 1.8 — 10.4
Balance, December 31, 2012 $467.1 $103.3 $270.7 $73.2 $62.1 $64.9 $1,041.3
(1) Balances related to United States were $451.7, $448.3 and $448.5 as of January 1, 2011, December 31, 2011 and December 31, 2012, respectively.
(2) Balances related to France were $15.8, $42.1 and $83.8 as of January 1, 2011, December 31, 2011 and December 31, 2012, respectively. Balances
related to Italy were $4.6, $5.4 and $5.5 as of January 1, 2011, December 31, 2011 and December 31, 2012, respectively.
(3) The majority of the Corporate balance as of December 31, 2012 relates to goodwill attributable to our acquisition of Jefferson Wells ($55.5) which is
part of the United States reporting unit. For purposes of monitoring our total assets by segment, we do not allocate the Corporate balance to the
respective reportable segments. We do, however, include these balances within the appropriate reporting units for our goodwill impairment testing.
See the table below for the breakout of goodwill balances by reporting unit.
(4) Balances were net of accumulated impairment loss of $513.4 as of January 1, 2011, December 31, 2011 and December 31, 2012.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
in millions, except share and per share data
68 ManpowerGroup 2012 Annual Report Notes to Consolidated Financial Statements