Symantec 2013 Annual Report Download - page 146

Revenue concerning compensating adjustments arising from this matter, resulting in an additional $10 million
tax benefit in the fourth quarter of fiscal 2011. This matter has now been closed and no further adjustments to the
accrued liability are expected.
On December 2, 2009, we received a Revenue Agent’s Report from the IRS for the VERITAS 2002 through
2005 tax years assessing additional taxes due. We contested $80 million of the tax assessed and all penalties. As
a result of negotiations with IRS Appeals in the third quarter of fiscal 2012, we remeasured our liability for
unrecognized tax benefits, resulting in a tax benefit of $52 million. We executed the final closing agreement for
the VERITAS 2002 through 2005 tax years on December 26, 2012. Accordingly, we recorded a further tax
benefit of $3 million during the third quarter of fiscal 2013 based on the closing agreement. Further, we amended
our state tax returns for the VERITAS 2002 through 2005 tax years in the fourth quarter of fiscal 2013 to reflect
the adjustments in the closing agreement and remeasured our state liability resulting in a benefit of $7 million.
The timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately
paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts
accrued for each year. Although potential resolution of uncertain tax positions involve multiple tax periods and
jurisdictions, it is reasonably possible that the gross unrecognized tax benefits related to these audits could
decrease (whether by payment, release, or a combination of both) in the next 12 months by between $15 million
and $130 million. Depending on the nature of the settlement or expiration of statutes of limitations, we estimate
at least $15 million could affect our income tax provision and therefore benefit the resulting effective tax rate. As
of March 29, 2013, we have $76 million on deposit with the IRS pertaining to U.S. tax matters in the Symantec
2005 through 2008 audit cycle.
We continue to monitor the progress of ongoing tax controversies and the impact, if any, of the expected
tolling of the statute of limitations in various taxing jurisdictions.
Noncontrolling interest
In fiscal 2011, we completed the acquisition of the identity and authentication business of VeriSign,
including a controlling interest in its subsidiary VeriSign Japan K.K. (“VeriSign Japan”), a publicly traded
company on the Tokyo Stock Exchange. Given our majority ownership interest of 54% in VeriSign Japan, the
accounts of VeriSign Japan have been consolidated with our accounts, and a noncontrolling interest has been
recorded for the noncontrolling investors’ interests in the equity and operations of VeriSign Japan. During the
second quarter of fiscal 2013, we completed a tender offer and paid $92 million to acquire VeriSign Japan
common shares and stock rights, which increased our ownership percentage to 92%. During the third quarter of
fiscal 2013, we acquired the remaining 8% interest for $19 million and VeriSign Japan became a wholly-owned
subsidiary. The payment was made in the fourth quarter of fiscal 2013. See Note 14 of the Notes to Consolidated
Financial Statements in this annual report for additional information. For fiscal 2013, 2012, and 2011, the loss
attributable to the noncontrolling interest in VeriSign Japan was approximately $0 million, $0 million, and
$4 million, respectively.
LIQUIDITY AND CAPITAL RESOURCES
Sources of cash
We have historically relied on cash flow from operations, borrowings under a credit facility, and issuances
of debt and equity securities for our liquidity needs. As of March 29, 2013, we had cash and cash equivalents of
$4.7 billion and an unused credit facility of $1.0 billion resulting in a liquidity position of $5.7 billion. As of
March 29, 2013, $2.6 billion in cash, cash equivalents, and marketable securities were held by our foreign
subsidiaries. We have provided U.S. deferred taxes on a portion of our undistributed foreign earnings sufficient
to address the incremental U.S. tax that would be due if we needed such portion of these funds to support our
operations in the U.S.
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