Albertsons 2012 Annual Report Download - page 56

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Income Taxes
Deferred income taxes represent future net tax effects resulting from temporary differences between the financial
statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the
differences are expected to be settled or realized.
The Company is currently in various stages of audits, appeals or other methods of review with taxing authorities
from various taxing jurisdictions. The Company establishes liabilities for unrecognized tax benefits in a variety
of taxing jurisdictions when, despite management’s belief that the Company’s tax return positions are
supportable, certain positions may be challenged and may need to be revised. The Company adjusts these
liabilities in light of changing facts and circumstances, such as the progress of a tax audit. The Company also
provides interest on these liabilities at the appropriate statutory interest rate. The Company recognizes interest
related to unrecognized tax benefits in interest expense and penalties in Selling and administrative expenses in
the Consolidated Statements of Earnings.
Net Earnings (Loss) Per Share
Basic net earnings (loss) per share is calculated using net earnings (loss) available to stockholders divided by the
weighted average number of shares outstanding during the period. Diluted net earnings (loss) per share is similar
to basic net earnings (loss) per share except that the weighted average number of shares outstanding is
determined after giving effect to the dilutive impacts of stock options, restricted stock awards and outstanding
convertible securities. In addition, for the calculation of diluted net earnings (loss) per share, net earnings (loss) is
adjusted to eliminate the after-tax interest expense recognized during the period related to contingently
convertible debentures if dilutive.
Reclassifications
Certain prior year amounts in the Company’s Consolidated Statement of Cash Flows and Consolidated Balance
Sheets have been reclassified to conform with to the current year’s presentation.
Recently Adopted Accounting Standards
In September 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update
No. 2011-09, Compensation—Retirement Benefits—Multiemployer Plans (Subtopic 715-80) (“ASU 2011-09”).
This accounting standard provides guidance on disclosure requirements for employers participating in
multiemployer pension and other postretirement benefit plans (multiemployer plans) to improve transparency and
increase awareness of the commitments and risks involved with participation in multiemployer plans. The new
guidance requires employers participating in multiemployer plans to provide additional quantitative and
qualitative disclosures to provide users with more detailed information regarding an employer’s involvement in
multiemployer plans. The Company adopted the standard effective February 25, 2012. Refer to Note 12 – Benefit
Plans in the accompanying Notes to Consolidated Financial Statements for additional information on the
Company’s participation in these multiemployer pension plans. The adoption of this new standard resulted in
enhanced disclosures, but otherwise did not have an impact on the Company’s Consolidated Financial
Statements.
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