VMware 2015 Annual Report Download - page 78

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TableofContents
VMware, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
havebeenfulfilled.Intheeventthearrangementdoesnotincludeprofessionalservices,unearnedlicenserevenuesmayalsoberecognizedratably,ifthecustomer
isgrantedtherighttoreceiveunspecifiedfutureproductsorVSOEoffairvalueonthesoftwaremaintenanceelementofthearrangementdoesnotexist.
UnearnedsoftwaremaintenancerevenuesareattributabletoVMware’smaintenancecontractsandaregenerallyrecognizedratablyoverthecontractperiod.
Theweighted-averageremainingtermatDecember31,2015wasapproximatelytwoyears.Unearnedprofessionalservicesrevenuesresultprimarilyfromprepaid
professionalservices,includingtraining,andaregenerallyrecognizedastheservicesaredelivered.
Unearnedlicenseandsoftwaremaintenancerevenueswillfluctuatebaseduponavarietyoffactorsincludingsalesvolume,thetimingofbothproduct
promotionoffersanddeliveryofthefutureproductsoffered,andtheamountofarrangementssoldwithratablerevenuerecognition.Additionally,theamountof
unearnedrevenuesderivedfromtransactionsdenominatedinaforeigncurrencyisimpactedbyfluctuationsintheforeigncurrenciesinwhichVMwareinvoices.
K. Income Taxes
Thedomesticandinternationalcomponentsofincomebeforeprovisionsforincometaxeswereasfollows(tableinmillions):
For the Year Ended December 31,
2015
2014
2013
Domestic $ 257
$ 174
$ 160
International 956
874
987
Total $ 1,213
$ 1,048
$ 1,147
VMware’sprovisionforincometaxesconsistedofthefollowing(tableinmillions):
For the Year Ended December 31,
2015
2014
2013
Federal:
Current $ 142
$ 188
$ 1
Deferred (33)
(116)
57
109
72
58
State:
Current 9
15
2
Deferred (1)
(12)
6
8
3
8
Foreign:
Current 96
87
72
Deferred 3
—
(5)
99
87
67
Totalprovisionforincometaxes $ 216
$ 162
$ 133
75