Emerson 2008 Annual Report Download - page 35

[ 28 ] Emerson 2008
addresses the accounting for uncertain tax positions that
a company has taken or expects to take on a tax return. As
of October 1, 2007, the Company had total unrecognized
tax benets of $149 million before recoverability of cross-
jurisdictional tax credits (U.S., state and non-U.S.) and
temporary differences, and including amounts related to
acquisitions that would reduce goodwill. If none of these
liabilities is ultimately paid, the tax provision and tax rate
would be favorably impacted by $90 million. As a result of
adoption, the Company recorded a charge of $6 million
to beginning retained earnings. See Note 13 for
additional disclosures regarding the adoption.
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In September 2006, the Financial Accounting Standards
Board issued Statement of Financial Accounting Stan-
dards No. 157, “Fair Value Measurements” (FAS 157). FAS
157 denes fair value, establishes a formal framework for
measuring fair value and expands disclosures about fair
value measurements. The Company believes FAS 157,
which is required to be adopted in the rst quarter of
scal 2009, will not have a material impact on the nan-
cial statements.
In March 2008, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards
No. 161, “Disclosures about Derivative Instruments and
Hedging Activities” (FAS 161). FAS 161 requires addi-
tional derivative disclosures, including objectives and
strategies for using derivatives, fair value amounts of and
gains and losses on derivative instruments, and credit-
risk-related contingent features in derivative agreements.
The Company believes FAS 161, which is effective for
nancial statements issued for scal years and interim
periods beginning after November 15, 2008, will not have
a material impact on the nancial statements.
In December 2007, the Financial Accounting Stan-
dards Board issued Statement of Financial Accounting
Standards No. 141(R), “Business Combinations” (FAS
141(R)). FAS 141(R) requires assets acquired and liabilities
assumed to be measured at fair value as of the acquisi-
tion date, acquisition related costs incurred prior to the
acquisition to be expensed and contractual contingencies
to be recognized at fair value as of the acquisition date.
FAS 141(R) is effective for acquisitions completed after
October 1, 2009.
In December 2007, the Financial Accounting Standards
Board issued Statement of Financial Accounting Stan-
dards No. 160, “Noncontrolling Interests in Consolidated
Financial Statements – an amendment of ARB No. 51”
(FAS 160). FAS 160 requires an entity to separately
disclose non-controlling interests as a separate compo-
nent of equity in the balance sheet and clearly identify on
the face of the income statement net income related to
non-controlling interests. FAS 160 is effective for scal
years beginning after December 15, 2008. The Company
does not expect the adoption of FAS 160 to have a mate-
rial impact on the nancial statements.
In June 2008, the Financial Accounting Standards Board
issued FASB Staff Position No. EITF 03-6-1, “Determining
Whether Instruments Granted in Share-Based Payment
Transactions Are Participating Securities” (FSP EITF
03-6-1). FSP EITF 03-6-1 claries whether instruments
granted in share-based payment transactions should be
included in the computation of EPS using the two-class
method prior to vesting. The Company is in the process of
analyzing the impact of FSP EITF 03-6-1, which is effective
for nancial statements issued for scal years beginning
after December 15, 2008. The Company does not expect
the adoption of FSP EITF 06-3-1 to have a material impact
on the nancial statements.
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Net earnings per share were a record $3.06 in 2008,
a 15 percent increase over the prior year.
2003 2008
$1.29
$1.70
$3.06
$2.24
$2.66
$1.49