Juno 2014 Annual Report Download - page 100

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Table of Contents




—The Company accounts for foreign currency translation in accordance with ASC 830, . The
functional currency of each of the Company's international subsidiaries is its respective local currency. The financial statements of these subsidiaries are
translated to U.S. Dollars using period-end rates of exchange for assets and liabilities, historical rates of exchange for equity, and average rates of exchange
for the period for revenues and expenses. Translation gains and losses are recorded in accumulated other comprehensive loss as a component of stockholders'
equity in the consolidated balance sheets.
—The Company applies the provisions of ASC 740, . Under ASC 740, deferred tax assets and liabilities are determined based
on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in
effect when the differences are expected to reverse. The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more
likely than not to be realized. In evaluating the Company's ability to recover its deferred tax assets, the Company considers all available positive and
negative evidence, including its operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In
accordance with ASC 740, the Company recognizes, in its consolidated financial statements, the impact of the Company's tax positions that are more likely
than not to be sustained upon examination based on the technical merits of the positions. The Company recognizes interest and penalties for uncertain tax
positions in income tax expense.
In connection with the FTD Spin-Off Transaction, the Company entered into a Tax Sharing Agreement with FTD. The Tax Sharing Agreement generally
will govern the Company's and FTD's respective rights, responsibilities, and obligations after the consummation of the FTD Spin-Off Transaction with respect
to taxes, including ordinary course of business taxes and taxes, if any, incurred as a result of any failure of the distribution to qualify as tax-free for U.S.
federal income tax purposes within the meaning of Section 355 of the Internal Revenue Code of 1986, as amended (the "Code"), including as a result of
Section 355(e) of the Code. Under the Tax Sharing Agreement, with certain exceptions, FTD generally will be responsible for the payment of all income and
non-income taxes attributable to its operations or the operations of its subsidiaries, and FTD will indemnify the Company for these taxes. With certain
exceptions, the Company generally will be responsible for the payment of all other income and non-income taxes, including consolidated U.S. federal
income taxes of the United Online tax reporting group for which FTD is severally liable, and the Company will indemnify FTD for these taxes. The Company
and FTD generally will be jointly responsible for any taxes that arise from the failure of the FTD Spin-Off Transaction to qualify as tax-free for U.S. federal
income tax purposes within the meaning of Section 355 of the Code, if such failure is for any reason for which neither the Company nor FTD is responsible.
—The Company computes earnings per share in accordance with ASC 260, . ASC 260 provides that unvested
share-based payment awards that contain non-forfeitable rights to dividends are participating securities and shall be included in the computation of earnings
per share pursuant to the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings
per share for common stock and any participating securities according to dividends declared (whether paid or unpaid) and participation rights in
undistributed earnings. Certain of the Company's restricted stock units are considered
F-18