Coach 2010 Annual Report Download - page 66

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TABLE OF CONTENTS
COACH, INC.
Notes to Consolidated Financial Statements
(dollars and shares in thousands, except per share data)
10. INCOME TAXES – (continued)
Current and deferred tax provisions (benefits) were:
Fiscal Year Ended
July 2, 2011 July 3, 2010 June 27, 2009
Current Deferred Current Deferred Current Deferred
Federal $ 345,006 $ 11,848 $ 384,716 $ (40,613) $ 300,700 $ (5,646)
Foreign (3,064) 26,589 (9,956) 28,449 (4,544) 14,788
State 38,753 1,287 65,562 (4,965) 49,507 4,518
Total current and deferred tax
provisions (benefits)
$ 380,695 $ 39,724 $ 440,322 $ (17,129) $ 345,663 $ 13,660
The components of deferred tax assets and liabilities at the respective year-ends were as follows:
Fiscal 2011 Fiscal 2010
Share-based compensation $ 59,672 $ 74,455
Reserves not deductible until paid 67,072 81,396
Pensions and other employee benefits 67,264 45,935
Property and equipment 12,439 17,121
Net operating loss 42,215 40,890
Other 2,887 3,194
Gross deferred tax assets $ 251,549 $ 262,991
Prepaid expenses $ 6,781 $ 7,426
Goodwill 45,528 20,521
Other 1,681 1,224
Gross deferred tax liabilities 53,990 29,171
Net deferred tax assets $ 197,559 $ 233,820
Consolidated Balance Sheets Classification
Deferred income taxes – current asset $ 93,902 $ 77,355
Deferred income taxes – noncurrent asset 103,657 156,465
Deferred income taxes – noncurrent liability — —
Net amount recognized $ 197,559 $ 233,820
Significant judgment is required in determining the worldwide provision for income taxes, and there are many transactions for which the
ultimate tax outcome is uncertain. It is the Company’s policy to establish provisions for taxes that may become payable in future years as a
result of an examination by tax authorities. The Company establishes the provisions based upon management’s assessment of exposure
associated with uncertain tax positions. The provisions are analyzed periodically and adjustments are made as events occur that warrant
adjustments to those provisions. All of these determinations are subject to the requirements of ASC 740.
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