Lululemon 2011 Annual Report Download - page 73

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Table of Contents
14 SUPPLEMENTAL CASH FLOW INFORMATION
Other, including changes in non-cash working capital items:
15 INCOME TAXES
The Company files income tax returns in the U.S., Canada and various foreign, state and provincial jurisdictions. The Company is subject
to income tax examination by tax authorities in all jurisdictions from its inception to date. The 2008 to 2011 tax years remain subject to
examination by the U.S. federal and state tax authorities. The 2007 tax year is still open for certain state tax authorities. The 2007 to 2011 tax
years remain subject to examination by tax authorities in certain foreign jurisdictions. The Company
’
s policy is to recognize interest expense and
penalties related to income tax matters as a selling, general and administrative expense. At January 29, 2012, the Company does not have any
significant accruals for interest related to unrecognized tax benefits or tax penalties.
The Company’s intercompany transfer pricing policies are currently subject to audits by the various foreign tax jurisdictions. Although the
Company believes that its intercompany transfer pricing policies and tax positions are fully supportable, the final determination of tax audits or
potential tax disputes may be different from that which is reflected in the Company’s income tax provisions and accruals.
The provision for income taxes consists of the following:
70
January 29,
2012
January 30,
2011
January 31,
2010
(Increase) decrease in receivables
$
3,743
$
(541
)
$
(3,974
)
Increase in deferred lease inducements received
2,905
1,934
675
(Increase) decrease in prepaid expenses and other current assets
(2,400
)
(2,902
)
(225
)
(Increase) decrease in inventories
(46,072
)
(7,954
)
11,296
Increase (decrease) in trade accounts payable
7,861
(5,167
)
6,025
Increase (decrease) in accrued liabilities
1,027
5,589
(4,857
)
Increase in sales tax collected
8,232
1,811
1,077
Increase in other non
-
cash balances
14,925
16,267
14,887
Increase (decrease) in income taxes payable
(3,951
)
14,929
5,886
$
(13,730
)
$
23,966
$
30,790
Cash paid for income taxes
$
85,633
$
30,968
$
27,719
Interest paid
$
501
$
424
$
157
January 29,
2012
January 30,
2011
January 31,
2010
Federal income tax at statutory rate
35.0
%
35.0
%
35.0
%
Non
-
deductible compensation expense
0.8
0.8
1.5
U.S. state taxes
2.8
1.7
0.3
Foreign tax rate differential
(3.4
)
(4.0
)
(3.8
)
Permanent and other
0.9
(0.2
)
(0.2
)
Provision for income taxes
36.1
%
33.3
%
32.8
%