Memorex 2013 Annual Report Download - page 87

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The accounting rules require the current and non-current components of the deferred tax balances to be netted by
jurisdiction prior to disclosure in the balance sheet. The table below shows the components of our deferred tax balances after
the results of that netting process as they are recorded on our Consolidated Balance Sheets:
As of
December 31
2013 2012
(In millions)
Deferred tax asset — current ................................................. $ 4.6 $ 4.7
Deferred tax asset — non-current .............................................. 9.5 9.3
Deferred tax liability — current ................................................ (0.4) (0.3)
Deferred tax liability — non-current ............................................. (1.0) (2.1)
Total ................................................................. $12.7 $11.6
Federal net operating loss carry forwards totaling $260.5 million will begin expiring in 2026. We have state income tax
loss carryforwards of $313.4 million, $3.6 million of which will expire between 2014 and 2016 and the remaining will expire at
various dates up to 2033. We have U.S. and foreign tax credit carryforwards of $35.8 million, $6.8 million of which will expire
between 2014 and 2016, $26.6 million of which will expire between 2017 and 2032 and $2.4 million may be carried forward
indefinitely. Of the aggregate foreign net operating loss carryforwards totaling $35.4 million, $0.3 million will expire between
2014 and 2016, $7.4 million will expire at various dates up to 2022 and $27.7 million may be carried forward indefinitely.
As of December 31, 2013, approximately $101.5 million of unremitted earnings attributable to our foreign subsidiaries
were considered to be permanently invested in their operations and no additional deferred taxes have been recorded.
Determination of the related tax liability is not practicable because of the complexities associated with the hypothetical
calculation, however the amount would be limited primarily to required withholding taxes in foreign jurisdictions given that we
have a full valuation allowance recorded in the U.S.
Our income tax returns are subject to review by various U.S. and foreign taxing authorities. As such, we record accruals
for items that we believe may be challenged by these taxing authorities. The threshold for recognizing the benefit of a tax
return position in the financial statements is that the position must be more-likely-than-not to be sustained by the taxing
authorities based solely on the technical merits of the position. If the recognition threshold is met, the tax benefit is measured
and recognized as the largest amount of tax benefit that, in our judgment, is greater than 50 percent likely to be realized.
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