MasterCard 2008 Annual Report Download - page 72
Download and view the complete annual report
Please find page 72 of the 2008 MasterCard annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
1 -
2
-
3
-
4
-
5
-
6
-
7
-
8
-
9
-
10
-
11
-
12
-
13
-
14
-
15
-
16
-
17
-
18
-
19
-
20
-
21
-
22
-
23
-
24
-
25
-
26
-
27
-
28
-
29
-
30
-
31
-
32
-
33
-
34
-
35
-
36
-
37
-
38
-
39
-
40
-
41
-
42
-
43
-
44
-
45
-
46
-
47
-
48
-
49
-
50
-
51
-
52
-
53
-
54
-
55
-
56
-
57
-
58
-
59
-
60
-
61
-
62 -
63 -
64 -
65 -
66 -
67 -
68 -
69 -
70 -
71 -
72 -
73 -
74 -
75 -
76 -
77 -
78 -
79 -
80 -
81 -
82 -
83
-
84
-
85
-
86
-
87
-
88
-
89
-
90
-
91
-
92
-
93
-
94
-
95
-
96
-
97
-
98
-
99
-
100
-
101
-
102
-
103
-
104
-
105
-
106
-
107
-
108
-
109
-
110
-
111
-
112
-
113
-
114
-
115
-
116
-
117
-
118
-
119
-
120
-
121
-
122
-
123
-
124
-
125
-
126
-
127
-
128
-
129
-
130
-
131
-
132
-
133
-
134
-
135
-
136
-
137
-
138
-
139
-
140
-
141
-
142
-
143
-
144
-
145
-
146
-
147
-
148
-
149
-
150
-
151
-
152
-
153
-
154
-
155
-
156
-
157
-
158
-
159
-
160
 |
 |
The Company’s GAAP effective income tax rate for 2008 was significantly affected by the tax benefits
related to the charges for the Discover Settlement and the American Express Settlement. The Company’s
effective tax rate for 2006 was significantly affected by the $395 million charitable contribution of MasterCard
Class A common stock to the Foundation. Due to the non-recurring nature of these items, the Company believes
that the calculation of the 2008 effective tax rate, excluding the impacts of the Discover Settlement and American
Express Settlement, and the 2006 effective tax rate, excluding the impact of the charitable stock contribution to
the Foundation, will be helpful in comparing effective tax rates for 2008, 2007 and 2006.
GAAP effective tax rate calculation
2008 2007 2006
(In millions, except percentages)
Income (loss) before income taxes ................................. $ (383) $1,671 $ 294
Income tax expense (benefit)1.................................... (129) 586 244
Net income (loss) .............................................. $ (254) $1,086 $ 50
Effective tax rate .............................................. 33.7% 35.0% 82.9%
Non-GAAP effective tax rate calculation
2008 2007 2006
(In millions, except percentages)
GAAP income (loss) before income taxes ........................... $ (383) $1,671 $ 294
Litigation settlements ........................................... 2,483 3 25
Stock donation to the MasterCard Foundation ........................ — — 395
Non-GAAP income before income taxes ............................ $2,100 $1,674 $ 714
Income tax expense (benefit)1.................................... (129) 586 244
Impact of litigation settlements on income tax expense (benefit) ......... (941) (1) (9)
Non-GAAP income tax expense .................................. 812 587 253
Non-GAAP net income ......................................... $1,288 $1,087 $ 461
Non-GAAP effective tax rate ..................................... 38.7% 35.0% 35.4%
1The 2006 stock contribution to the MasterCard Foundation was a permanently non-deductible item and
therefore has no impact on the calculation of non-GAAP income tax expense. The 2008 litigation
settlements will be deductible in future periods as payments are made and are therefore considered in the
calculation of non-GAAP income tax expense.
62