eTrade 1999 Annual Report Download - page 54

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Deferred income taxes are recorded when revenues and expenses are recognized in different periods for financial statement and tax
return purposes. The temporary differences and tax carryforwards that created deferred tax assets (liabilities) are as follows (in
thousands):
September 30,
-----------------
1999 1998
-------- -------
Deferred tax assets:
Reserves and allowances................................ $ 2,268 $ 599
Net operating loss carryforwards....................... 80,415 12,173
Depreciation and amortization.......................... 1,505 828
Deferred compensation.................................. 1,373 999
Capitalized research and development................... 5,290 --
Undistributed earnings in subsidiaries................. 5,261 --
Other.................................................. 2,437 685
-------- -------
Total deferred tax assets............................ 98,549 15,284
-------- -------
Deferred tax liabilities:
Internally developed software.......................... (1,709)
(5,783)
Gain on investments.................................... (115,361)
(8,319)
Purchased software..................................... (3,024) --
Other.................................................. (82)
(947)
-------- -------
Total deferred tax liabilities....................... (120,176)
(15,049)
Valuation allowance...................................... (1,629)
(939)
-------- -------
Net deferred tax liability............................... $(23,256) $
(704)
======== =======
56
The Company recorded a valuation allowance of $1,629,000 and $939,000 for the deferred tax assets at September 30, 1999 and
1998, respectively, as full realization of net operating loss carry forwards is not expected in certain foreign countries.
The effective tax rates differed from the federal statutory rates as follows:
2002. EDGAR Online, Inc.