Symantec 2015 Annual Report Download - page 165

closing agreement. We also amended our state tax returns for the Veritas 2002 through 2005 tax years in fiscal
2013 to reflect the adjustments in the closing agreement and remeasured our state liability resulting in a benefit
of $7 million.
On September 3, 2013, we settled and effectively settled matters with the IRS for the Symantec 2005
through 2008 fiscal years. The result of the settlements, effective settlements, and re-measurements resulted in a
reduction in the balance of our gross unrecognized tax benefits in fiscal year 2014 of $122 million.
On March 18, 2015, we settled and effectively settled matters with the IRS for the Symantec 2009 through
2013 fiscal years. The settlement and effective settlement resulted in a benefit to tax expense in fiscal year 2015
of $59 million. Additionally, the Company settled transfer price related matters of $158 million, a portion of
which was accounted for against deferred tax liabilities on unremitted foreign earnings. The Company has paid in
$155 million to cover the final tax and interest liability on the settlement.
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 $44 million.
Depending on the nature of the settlement or expiration of statutes of limitations, we estimate $44 million could
affect our income tax provision and therefore benefit the resulting effective tax rate.
We continue to monitor the progress of ongoing income tax controversies and the impact, if any, of the
expected tolling of the statute of limitations in various taxing jurisdictions.
Note 12. Earnings Per Share
Basic and diluted earnings per share are computed on the basis of the weighted-average number of shares of
common stock outstanding during the period. Diluted earnings per share also include the incremental effect of
dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive
potential common shares include the dilutive effect of shares underlying outstanding stock options, restricted
stock, warrants, ESPP and convertible senior notes.
The components of earnings per share attributable to Symantec Corporation stockholders are as follows:
Year Ended
April 3,
2015
March 28,
2014
March 29,
2013
(In millions, except per share data)
Net income $ 878 $ 898 $ 755
Net income per share — basic $ 1.27 $ 1.29 $ 1.08
Net income per share — diluted $ 1.26 $ 1.28 $ 1.06
Weighted-average shares outstanding — basic 689 696 701
Dilutive potential shares from stock-based compensation 7 8 10
Weighted-average shares outstanding — diluted 696 704 711
Anti-dilutive effect of stock-based compensation and note hedge 1 5 24
Note 13. Subsequent Event
On January 24, 2011, a class action lawsuit was filed against the Company and its previous e-commerce
vendor Digital River, Inc. Against the Company, the lawsuit alleged violations of California’s Unfair
Competition Law, the California Legal Remedies Act and unjust enrichment related to prior sales of Extended
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