Autodesk 2012 Annual Report Download - page 137

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Significant components of Autodesk’s deferred tax assets and liabilities are as follows:
Nonqualified stock options
Research and development tax credit carryforwards
Foreign tax credit carryforwards
Accrued compensation and benefits
Other accruals not currently deductible for tax
Purchased technology and capitalized software
Fixed assets
Tax loss carryforwards
Other
Total deferred tax assets
Less: valuation allowance
Net deferred tax assets
Tax method change on advanced payments
Unremitted earnings of foreign subsidiaries
Total deferred tax liability
Net deferred tax assets
January 31,
2012
$ 71.6
49.3
0.1
35.6
31.1
20.6
15.9
12.4
3.7
240.3
(47.5)
192.8
(6.3)
(20.6)
(26.9)
$ 165.9
2011
$ 69.0
64.0
16.6
33.7
20.8
25.3
15.1
6.3
2.6
253.4
(42.9)
210.5
(9.4)
(53.6)
(63.0)
$ 147.5
The valuation allowance increased by $4.6 million, $3.9 million and $14.3 million in fiscal 2012, 2011 and 2010,
respectively. The fiscal 2012, fiscal 2011, and fiscal 2010 changes in valuation allowance were related to California and
Canadian deferred taxes. During the first quarter of fiscal 2010, the State of California enacted legislation significantly altering
California tax law. As a result of the newly enacted legislation, Autodesk expects that in fiscal years 2012 and beyond, income
subject to tax in California will be less than under prior tax law and accordingly, deferred tax assets are less likely to be
realized.
No provision has been made for federal income taxes on unremitted earnings of certain Autodesk's foreign subsidiaries
(cumulatively $1,290.1 million at January 31, 2012) because Autodesk plans to reinvest such earnings indefinitely. At
January 31, 2012, the net unrecognized deferred tax liability for these earnings was approximately $390.9 million.
Realization of the Company's net deferred tax assets of $165.9 million is dependent upon the Company's ability to
generate future taxable income in appropriate tax jurisdictions to obtain benefit from the reversal of temporary differences, net
operating loss carryforwards and tax credits. The amount of deferred tax assets considered realizable is subject to adjustment in
future periods if estimates of future taxable income are reduced.
As of January 31, 2012, Autodesk had $34.2 million of cumulative federal tax loss carryforwards and $306.9 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 2013 through fiscal 2032 and fiscal 2013 through
fiscal 2032, respectively.
As of January 31, 2012, Autodesk had $77.8 million of cumulative federal research tax credit carryforwards, $34.3
million of cumulative California state research tax credit carryforwards and $50.1 million of cumulative Canadian federal 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 2013 through fiscal 2032, the state credit carryforwards may reduce future
California income tax liabilities indefinitely, and the Canadian tax credit carryforwards will expire beginning fiscal 2023
through fiscal 2032. Autodesk also has $60.0 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 2020 through fiscal 2022.
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
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expiration of net operating losses and credits before utilization.
2012 Annual Report