Circuit City 2006 Annual Report Download - page 46

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Foreign 508 6,983 (2,203)
--- ----- ------
Total deferred 2,254 6,228 (2,377)
----- ----- ------
TOTAL $24,548 $21,433 $6,368
======= ======= ======
Years Ended December 31 2006 2005 2004
----------------------- ---- ---- ----
Income tax at Federal statutory rate $24,407 $11,506 $5,795
State and local income taxes (benefits) and
changes in valuation allowances, net of
federal tax benefit 2,577 1,311 (172)
Foreign taxes at rates different from the U.S. rate 1,199 1,703 2,375
Changes in valuation allowances for foreign
deferred tax assets (2,260) 10,194 --
Tax credits (718) (197) (599)
Adjustment for prior year taxes (760) (3,205) (588)
Other items, net 103 121 (443)
--- --- ----
$24,548 $21,433 $6,368
======= ======= ======
2006 2005
---- ----
Current:
Deductible assets $ (876) $(1,197)
Accrued expenses and other liabilities 8,063 9,875
Inventory 1,596 1,201
Other (318) (125)
Valuation allowances (738) (527)
---- ----
Total current 7,727 9,227
----- -----
Non-current:
Net operating loss and credit carryforwards 15,881 14,543
Foreign currency translation adjustments - (511)
Accelerated depreciation 3,520 3,059
Intangible and other assets 8,453 10,031
Other 3,328 1,757
Valuation allowances (17,141) (14,779)
------- -------
Total non-current 14,041 14,100
------- -------
TOTAL $21,768 $23,327
======= =======
Income taxes are accrued and paid by each foreign entity in accordance with applicable local regulations.
A reconciliation of the difference between the income tax expense (benefit) and the computed income tax expense
based on the Federal statutory corporate rate is as follows (in thousands):
The deferred tax assets (liabilities) are comprised of the following (in thousands):
The Company has not provided for federal income taxes applicable to the undistributed earnings of its foreign
subsidiaries of approximately $21.8 million as of December 31, 2006, since these earnings are indefinitely reinvested.
The Company has foreign net operating loss carryforwards which expire from 2006 through 2020 except for
carryforwards in the United Kingdom and the Netherlands, which have no expiration. The Company records these
benefits as assets to the extent that utilization of such assets is more likely than not; otherwise, a valuation allowance
has been recorded. The Company has also provided valuation allowances for certain state deferred tax assets and net
operating loss carryforwards where it is not likely they will be realized.