Dillard's 2013 Annual Report Download - page 63

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F-17
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the
Company's deferred tax assets and liabilities as of February 1, 2014 and February 2, 2013 are as follows:
(in thousands of dollars)
February 1,
2014
February 2,
2013
Property and equipment bases and depreciation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 311,422 $ 346,246
Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,083 26,565
Joint venture bases differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,407 12,277
Differences between book and tax bases of inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,214 52,306
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,539 3,239
Total deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 428,665 440,633
Accruals not currently deductible. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (81,383)(94,286)
Net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (82,262)(89,828)
State income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,751)(1,994)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,611)(199)
Total deferred tax assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (167,007)(186,307)
Net operating loss valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,503 62,712
Net deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (114,504)(123,595)
Net deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 314,161 $ 317,038
At February 1, 2014, the Company had a deferred tax asset related to state net operating loss carryforwards of
approximately $82.3 million that could be utilized to reduce the tax liabilities of future years. These carryforwards will expire
between fiscal 2014 and 2034. A portion of the deferred tax asset attributable to state net operating loss carryforwards was
reduced by a valuation allowance of approximately $52.5 million for the losses of various members of the affiliated group in
states for which the Company determined that it is "more likely than not" that the benefit of the net operating losses will not be
realized.
Deferred tax assets and liabilities are presented as follows in the accompanying consolidated balance sheets:
(in thousands of dollars)
February 1,
2014
February 2,
2013
Net deferred tax liabilities—noncurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 230,248 $ 255,652
Net deferred tax liabilities—current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83,913 61,386
Net deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 314,161 $ 317,038
The total amount of unrecognized tax benefits as of February 1, 2014 and February 2, 2013 was $6.5 million and $5.4
million, respectively, of which $4.1 million and $3.9 million, respectively, would, if recognized, affect the effective tax rate.
The Company classifies accrued interest expense and penalties relating to income tax in the consolidated financial statements
as income tax expense. The total interest and penalties recognized in the consolidated statements of income during fiscal 2013,
2012 and 2011 was $(0.4) million, $(2.1) million and $(0.2) million, respectively. The total accrued interest and penalties in the
consolidated balance sheets as of February 1, 2014 and February 2, 2013 was $0.9 million and $1.4 million, respectively.