Orbitz 2013 Annual Report Download - page 77

ORBITZ WORLDWIDE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
77
Current and non-current deferred income tax assets and liabilities in various jurisdictions are composed of the following:
December 31, 2013 December 31, 2012
(in thousands)
Current deferred income tax assets/(liabilities):
Accrued liabilities and deferred income $ 3,422 $ 4,233
Provision for bad debts 199 179
Prepaid expenses (1,854)(1,860)
Tax sharing liability 6,774 5,529
Reserve accounts 4,129 4,084
Other — (404)
Valuation allowance (1,521)(11,774)
Current net deferred income tax assets (a) $ 11,149 $ (13)
Non-current deferred income tax assets/(liabilities):
U.S. net operating loss carryforwards $ 51,887 $ 46,749
Non-U.S. net operating loss carryforwards 92,637 98,437
Accrued liabilities and deferred income 7,309 5,811
Depreciation and amortization 84,434 99,508
Tax sharing liability 22,339 25,750
Other 9,070 15,552
Valuation allowance (107,039)(285,034)
Non-current net deferred income tax assets $ 160,637 $ 6,773
(a) The current portion of the deferred income tax asset at December 31, 2013 and 2012 is included in other current
assets in our consolidated balance sheets.
The net deferred tax assets at December 31, 2013 and 2012 amounted to $171.8 million and $6.8 million, respectively.
These net deferred tax assets largely relate to temporary tax to book differences and net operating loss carryforwards, the
realization of which is, in management's judgment, more likely than not. We have assessed the likelihood of realization based
on our expectations of future taxable income, carry-forward periods available and other relevant factors.
During 2013 we released the valuation allowance against the majority of our US deferred tax assets. As a result, our
net deferred tax assets increased significantly during 2013.
As of December 31, 2012, we had established valuation allowances against the majority of our deferred tax assets. As a
result, any changes in our gross deferred tax assets and liabilities during the year ended December 31, 2012 was largely offset
by corresponding changes in our valuation allowances, resulting in a decrease in our net deferred tax assets of $0.5 million for
the year ended December 31, 2012.
As of December 31, 2013, we had U.S. federal and state net operating loss carry-forwards of approximately $136.7
million and $97.5 million, respectively, which expire between 2021 and 2033. In addition, we had $424.7 million of non-
U.S. net operating loss carry-forwards, most of which do not expire. Additionally, we had $5.0 million of U.S. federal and state
income tax credit carry-forwards which expire between 2027 and 2033 and $1.1 million of U.S. federal income tax credits
which have no expiration date. No provision has been made for U.S. federal or non-U.S. deferred income taxes on
approximately $11.9 million of accumulated and undistributed earnings of foreign subsidiaries at December 31, 2013. A
provision has not been established because it is our present intention to reinvest the undistributed earnings indefinitely in those
foreign operations. The determination of the amount of unrecognized U.S. federal or non-U.S. deferred income tax liabilities
for unremitted earnings at December 31, 2013 is not practicable.
We have established a liability for unrecognized tax benefits that management believes to be adequate. Once established,
unrecognized tax benefits are adjusted if more accurate information becomes available, or a change in circumstance or an event
occurs necessitating a change to the liability. Given the inherent complexities of the business and that we are subject to taxation
in a substantial number of jurisdictions, we routinely assess the likelihood of additional assessment in each of the taxing
jurisdictions.