Adobe 2007 Annual Report Download - page 83
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83
Accrued expenses consisted of the following as of November 30, 2007 and December 1, 2006:
2007 2006
Accrued compensation and benefits.......................... $ 205,018 $ 148,000
Sales and marketing allowances ............................. 21,231 20,361
Other................................................... 157,187 135,189
Total accrued expenses .................................. $ 383,436 $ 303,550
Note 8. Income Taxes
Income before income taxes includes income from foreign operations of $453.2 million, $293.7 million and $348.7
million for fiscal 2007, 2006 and 2005, respectively.
The provision for income taxes consisted of the following for fiscal 2007, 2006 and 2005:
2007 2006 2005
Current:
United States federal.......................................... $ 36,614 $ 12,419 $ 63,932
Foreign..................................................... 55,536 34,762 18,550
State and local............................................... 4,100 3,623 4,671
Total current .................................................. 96,250 50,804 87,153
Deferred:
United States federal.......................................... 50,640 (19,843 ) (7,653)
Foreign..................................................... (13,480) 2,198 93
State and local............................................... 23,007 (5,383 ) 492
Total deferred ................................................. 60,167 (23,028 ) (7,068)
Tax expense attributable to employee stock plans .................... 66,966 146,142 82,852
$ 223,383 $ 173,918 $ 162,937
Certain employee stock plan benefits in fiscal 2007 and 2006 associated with the acquisition of Macromedia reduced
goodwill. See Note 5 for further information.
Total income tax expense differs from the expected tax expense (computed by multiplying the United States federal
statutory rate of 35% by income before income taxes) as a result of the following:
2007 2006 2005
Computed “expected” tax expense ........................ $ 331,516 $ 237,905 $ 268,022
State tax expense, net of federal benefit.................... 8,938 8,768 9,878
Tax-exempt income .................................... (11,123) (12,637 ) (7,196)
Tax credits............................................ (23,341) (1,204 ) (8,977)
Differences between statutory rate and foreign effective tax rate (84,740) (61,067 ) (62,561)
Change in deferred tax asset valuation allowance............ 1,694 (7,539 ) (5,836)
FAS 123R Stock Compensation (net of tax deduction)........ 2,587 3,320 —
Tax benefit for repatriation of certain foreign earnings under the
AJCA.............................................. — — (29,271)
Other, net............................................. (2,148) 6,372 (1,122)
$ 223,383 $ 173,918 $ 162,937
The tax effects of the temporary differences that gave rise to significant portions of the deferred tax assets and liabilities
as of November 30, 2007 and December 1, 2006 are presented below: