Unum 2009 Annual Report Download - page 124
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122
Notes To Consolidated Financial Statements
Unum
2009
Our consolidated statements of income include amounts subject to both domestic and foreign taxation. The income and related tax
expense (benefit) are as follows:
Year Ended December 31
(in millions of dollars) 2009 2008 2007
Income Before Tax
United States — Federal $1,065.2 $ 531.3 $ 703.9
Foreign 227.1 292.7 311.1
Total $1,292.3 $ 824.0 $1,015.0
Current Tax Expense
United States — Federal $ 283.7 $ 297.2 $ 214.0
Foreign 94.2 43.7 72.9
Total 377.9 340.9 286.9
Deferred Tax Expense (Benefit)
United States — Federal 91.4 (106.2) 38.6
Foreign (29.6) 36.1 10.2
Total 61.8 (70.1) 48.8
Total $ 439.7 $ 270.8 $ 335.7
During 2007, the U.K. enacted a tax rate decrease from 30 percent to 28 percent. The tax benefit recognized in 2007 operations as
a result of this decrease was $1.7 million. We consider the unremitted earnings of our foreign operations to be permanently invested.
The determination of a tax liability related to these earnings is not practicable.
The cumulative effect of applying the provisions of the accounting interpretation, now included in ASC 740, which clarified the
accounting for uncertainty in income taxes recognized in an enterprise’s financial statements resulted in a $22.7 million decrease in our
liability for unrecognized tax benefits, net of associated deferred tax assets, as of January 1, 2007. Our consolidated statements of income
include the following changes in unrecognized tax benefits:
December 31
(in millions of dollars) 2009 2008
Balance at Beginning of Year $ 149.8 $ 161.0
Tax Positions Related to Prior Years
Additions 8.5 0.3
Subtractions (11.5) (11.5)
Balance at End of Year 146.8 149.8
Less Tax Attributable to Temporary Items Included Above (131.6) (134.6)
Total Unrecognized Tax Benefits that if Recognized Would Affect the Effective Tax Rate $ 15.2 $ 15.2
Included in the balance at December 31, 2009 and 2008 are $131.6 million and $134.6 million, respectively, of unrecognized tax
benefits for tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such
deductibility. Other than potential interest and penalties, the disallowance of the shorter deductibility period would not affect our results
of operations but would accelerate the payment of cash to the taxing authority to an earlier period.