Visa 2009 Annual Report Download - page 113
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Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2009
(in millions, except as noted)
The tax effect of temporary differences that give rise to significant portions of deferred tax assets and liabilities at September 30, 2009 and 2008 are
presented below:
2009 2008
(in millions)
Deferred Tax Assets
Accrued compensation and benefits $ 37 $ 88
Comprehensive income 105 41
Investments in joint ventures 19 —
Accrued litigation obligation 571 1,182
Volume and support incentives 122 37
Research and development credits 19 19
Federal benefit of state taxes 268 211
Federal benefit of foreign taxes 5 32
Other 44 28
Deferred tax assets 1,190 1,638
Deferred Tax Liabilities
Property, equipment and technology, net (135) (82)
Investment in joint ventures — (212)
Intangible assets (4,131) (4,199)
Foreign taxes (16) (4)
Other (12) (8)
Deferred tax liabilities (4,294) (4,505)
Net deferred tax (liabilities) assets $ (3,104) $ (2,867)
Total net deferred tax assets and liabilities are included in the Company's consolidated balance sheets as follows:
September 30,
2009
September 30,
2008
(in millions)
Current deferred tax assets $ 703 $ 944
Non current deferred tax (liabilities) assets, net (3,807) (3,811)
Net deferred tax (liabilities) assets $ (3,104) $ (2,867)
The decrease in the deferred tax asset for accrued litigation obligation is primarily due to payments of the Discover settlement during fiscal 2009.
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that all or some portion of the deferred tax
assets will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible. Management believes it is more likely than not that the Company will realize the benefits of its
deferred tax assets recorded.
The Company had state research and development tax credit carry forwards of approximately $19 million at September 30, 2009 that may be carried
forward indefinitely. The Company expects to realize the benefit of the credit carry forwards in future years.
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