Hess 2000 Annual Report Download - page 42

Download and view the complete annual report

Please find page 42 of the 2000 Hess annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 62

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62

11. Provision for Income Taxes
The provision (benefit) for income taxes consisted of:
Millions of dollars 2000 1999 1998
United States Federal
Current $92 $6 $9
Deferred 62 82 (68)
State 22 62
176 94 (57)
Foreign
Current 371 189 71
Deferred 102 (15) (66)
473 174 5
Adjustment of deferred tax
liability for foreign
income tax rate change —(4) (3)
Total $649 $264* $(55)
*Includes a benefit of $54 million representing deductions for certain prior
year foreign drilling costs and capital losses.
Income (loss) before income taxes consisted of the
following:
Millions of dollars 2000 1999 1998
United States $ 497 $397 $(205)
Foreign* 1,175 305 (309)
Total $1,672 $702 $(514)
*Foreign income includes the Corporation’s Virgin Islands, shipping and
other operations located outside of the United States.
Deferred income taxes arise from temporary differences
between the tax basis of assets and liabilities and their
reported amounts in the financial statements. A summary
of the components of deferred tax liabilities and assets at
December 31 follows:
Millions of dollars 2000 1999
Deferred tax liabilities
Fixed assets and investments $ 350 $ 320
Foreign petroleum taxes 202 225
Other 97 56
Total deferred tax liabilities 649 601
Deferred tax assets
Accrued liabilities 99 98
Net operating and capital loss
carryforwards 171 300
Tax credit carryforwards 122 138
Other 28 79
Total deferred tax assets 420 615
Valuation allowance (111) (182)
Net deferred tax assets 309 433
Net deferred tax liabilities $ 340 $ 168
The difference between the Corporation’s effective
income tax rate and the United States statutory rate is
reconciled below:
2000 1999 1998
United States statutory rate 35.0% 35.0% (35.0)%
Effect of foreign operations,
including foreign tax credits 3.5 3.0 24.2
State income taxes, net of
Federal income tax benefit .8 .6 .2
Prior year adjustments (.6) (.8) (.3)
Other .1 (.2) .2
Total 38.8% 37.6% (10.7)%
40