Autodesk 2009 Annual Report Download - page 150

AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
As of January 31, 2009, Autodesk had $33.6 million of cumulative Federal tax loss carryforwards and
$237.5 million of cumulative state tax loss carryforwards, which may be available to reduce future income tax
liabilities in certain jurisdictions. These Federal and state tax loss carryforwards will expire beginning fiscal 2011
through fiscal 2029 and fiscal 2010 through fiscal 2028, respectively.
As of January 31, 2009, Autodesk had $57.2 million of cumulative Federal research tax credit
carryforwards, $30.9 million of cumulative California state research tax credit carryforwards and $40.1 million
of cumulative Canadian tax credit carryforwards, which may be available to reduce future income tax liabilities
in the respective jurisdictions. The Federal credit carryforwards will expire beginning fiscal 2012 through fiscal
2029, the state credit carryforwards may reduce future California income tax liabilities indefinitely, and the
Canadian tax credit carryforwards will expire beginning fiscal 2012 through fiscal 2029. Autodesk also has $77.7
million of cumulative foreign tax credit carryforwards, which may be available to reduce future U. S. tax
liabilities. The foreign tax credit will expire beginning fiscal 2018 through fiscal 2019.
Utilization of net operating losses and tax credits may be subject to an annual limitation due to ownership
change limitations provided in the Internal Revenue Code and similar state provisions. This annual limitation
may result in the expiration of net operating losses and credits before utilization.
As a result of certain business and employment actions and capital investments undertaken by Autodesk,
income earned in certain countries is subject to reduced tax rates through fiscal 2019. The income tax benefits
attributable to the tax status of these business arrangements are estimated to be $0.3 million ($0.001 basic net
income per share) in fiscal 2009, $9.0 million ($0.04 basic net income per share) in fiscal 2008, and $15.0
million ($0.06 basic net income per share) in fiscal 2007.
During fiscal 2009, Autodesk recognized income tax benefits of approximately $6.1 million primarily
related to closure of audits and other decreases in FIN 48 reserves with respect to fiscal 2002 through fiscal 2008.
During fiscal 2008, Autodesk recognized income tax benefits of approximately $3.0 million primarily
related to the lapse of foreign statute of limitations with respect to fiscal 2001.
During fiscal 2007, Autodesk recognized the following income tax benefits:
• In December 2006, Congress passed the Tax Relief and Health Care Act of 2006 which resulted in the
reinstatement of the Federal research and development credit to the beginning of Autodesk’s fiscal
2007 year. Autodesk recorded an income tax benefit of $5.6 million from this Act during the fourth
quarter of fiscal 2007.
• Autodesk also recognized an income tax benefit of $12.5 million related to the lapse of the statute of
limitations with respect to certain Federal and foreign tax years and the release of tax reserves with
respect to fiscal 2003, offset by one-time income tax expense of $3.0 million primarily associated with
the expiration of a capital loss carryforward.
As of January 31, 2009, the Company had $178.1 million of gross unrecognized tax benefits, of which
$166.8 million would impact the effective tax rate, if recognized. It is possible that the amount of unrecognized
tax benefits will change in the next twelve months; however an estimate of the range of the possible change
cannot be made at this time.
72