Nucor 2011 Annual Report Download - page 36

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35
ENVIRONMENTAL REMEDIATION
We are subject to environmental laws and regulations established by federal, state and local authorities, and we make provision
for the estimated costs related to compliance. Undiscounted remediation liabilities are accrued based on estimates of known
environmental exposures. The accruals are reviewed periodically and, as investigations and remediation proceed, adjustments
are made as we believe are necessary. The accruals are not reduced by possible recoveries from insurance carriers or other third
parties. Our measurement of environmental liabilities is based on currently available facts, present laws and regulations, and
current technology.
INCOME TAXES
We utilize the liability method of accounting for income taxes. Under the liability method, deferred taxes are determined based on
the temporary differences between the financial statement and tax basis of assets and liabilities using tax rates expected to be in
effect during the years in which the basis differences reverse. A valuation allowance is recorded when it is more likely than not that
some of the deferred tax assets will not be realized. We recognize the effect of income tax positions only if those positions are more
likely than not of being sustained. Potential accrued interest and penalties related to unrecognized tax benefits within operations are
recognized as a component of earnings before taxes and noncontrolling interests.
RECENT ACCOUNTING PRONOUNCEMENTS
See Note 2 to our consolidated financial statements for a discussion of new accounting pronouncements adopted by Nucor
during 2011 and the expected financial impact of accounting pronouncements recently issued or proposed but not yet required
to be adopted.