Chevron 2009 Annual Report Download - page 57

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Chevron Corporation 2009 Annual Report 55
FS-PB
The following table indicates the changes to the company’s
unrecognized tax benefits for the year ended December 31,
2009. The term “unrecognized tax benefits” in the accounting
standards for income taxes (ASC 740-10-20) refers to the dif-
ferences between a tax position taken or expected to be taken
in a tax return and the benefit measured and recognized in the
financial statements. Interest and penalties are not included.
2009 2008 2007
Balance at January 1 $ 2,696 $ 2,199 $ 2,296
Foreign currency effects (1) (1) 19
Additions based on tax positions
taken in current year 459 522 418
Reductions based on tax positions
taken in current year – (17) –
Additions/reductions resulting from
current-year asset acquisitions/sales – 175 –
Additions for tax positions taken
in prior years 533 337 120
Reductions for tax positions taken
in prior years (182) (246) (225)
Settlements with taxing authorities
in current year (300) (215) (255)
Reductions as a result of a lapse
of the applicable statute of limitations (10) (58) –
Reductions due to tax positions previously
expected to be taken but subsequently
not taken on prior-year tax returns – – (174)
Balance at December 31 $ 3,195 $ 2,696 $ 2,199
Although unrecognized tax benefits for individual tax
positions may increase or decrease during 2010, the company
believes that no change will be individually significant during
2010. Approximately 90 percent of the $3,195 of unrecog-
nized tax benefits at December 31, 2009, would have an
impact on the effective tax rate if subsequently recognized.
Tax positions for Chevron and its subsidiaries and
affiliates are subject to income tax audits by many tax juris-
dictions throughout the world. For the company’s major tax
jurisdictions, examinations of tax returns for certain prior tax years
had not been completed as of December 31, 2009. For these
jurisdictions, the latest years for which income tax examinations
had been finalized were as follows: United States – 2005,
Nigeria – 1994, Angola – 2001 and Saudi Arabia – 2003.
On the Consolidated Statement of Income, the company
reports interest and penalties related to liabilities for uncertain
tax positions as “Income tax expense.” As of December 31,
2009, accruals of $232 for anticipated interest and penalty
obligations were included on the Consolidated Balance Sheet,
compared with accruals of $276 as of year-end 2008. Income
tax (benefit) expense associated with interest and penalties was
$(20), $79 and $70 in 2009, 2008 and 2007, respectively.
Taxes Other Than on Income
Year ended December 31
2009 2008 2007
United States
Excise and similar taxes on
products and merchandise $ 4,573 $ 4,748 $ 4,992
Import duties and other levies (4) 1 12
Property and other
miscellaneous taxes 584 588 491
Payroll taxes 223 204 185
Taxes on production 135 431 288
Total United States 5,511 5,972 5,968
International
Excise and similar taxes on
products and merchandise 3,536 5,098 5,129
Import duties and other levies 6,550 8,368 10,404
Property and other
miscellaneous taxes 1,740 1,557 528
Payroll taxes 134 106 89
Taxes on production 120 202 148
Total International 12,080 15,331 16,298
Total taxes other than on income $ 17,591 $ 21,303 $ 22,266
Note 16
Short-Term Debt
At December 31
2009 2008
Commercial paper* $ 2,499 $ 5,742
Notes payable to banks and others with
originating terms of one year or less 213 149
Current maturities of long-term debt 66 429
Current maturities of long-term
capital leases 76 78
Redeemable long-term obligations
Long-term debt 1,702 1,351
Capital leases 18 19
Subtotal 4,574 7,768
Reclassified to long-term debt (4,190) (4,950)
Total short-term debt $ 384 $ 2,818
* Weighted-average interest rates at December 31, 2009 and 2008, were 0.08 percent
and 0.67 percent, respectively.
Redeemable long-term obligations consist primarily
of tax-exempt variable-rate put bonds that are included as
current liabilities because they become redeemable at the
option of the bondholders within one year following
Note 15 Taxes – Continued