Ross 2011 Annual Report Download - page 52

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At the end of fiscal 2011, 2010, and 2009, the reserves for unrecognized tax benefits (net of federal tax benefits) were
$53.5 million, $41.8 million, and $33.6 million inclusive of $12.0 million, $12.0 million, and $10.0 million of related interest, respectively.
The Company accounts for interest and penalties related to unrecognized tax benefits as a part of its provision for taxes on
earnings. If recognized, $36.0 million would impact the Company’s effective tax rate. The difference between the total amount of
unrecognized tax benefits and the amounts that would impact the effective tax rate relates to amounts attributable to deferred
income tax assets and liabilities. These amounts are net of federal and state income taxes.
During the next twelve months, it is reasonably possible that the statute of limitations may lapse pertaining to positions taken by
the Company in prior year tax returns. If this occurs, the total amount of unrecognized tax benefits may decrease, reducing the
provision for taxes on earnings by up to $1.2 million.
The Company is generally open to audit by the Internal Revenue Service under the statute of limitations for fiscal years 2008
through 2011. The Company’s state income tax returns are generally open to audit under the various statutes of limitations for
fiscal years 2007 through 2011. Certain state tax returns are currently under audit by state tax authorities. The Company does
not expect the results of these audits to have a material impact on the consolidated financial statements.
Note G: Employee Benefit Plans
The Company has a defined contribution plan that is available to certain employees. Under the plan, employee and Company
contributions and accumulated plan earnings qualify for favorable tax treatment under Section 401(k) of the Internal Revenue
Code. This plan permits employees to make contributions up to the maximum limits allowable under the Internal Revenue Code.
The Company matches up to 4% of the employee’s salary up to the plan limits. Company matching contributions to the 401(k)
plan were $8.7 million, $8.2 million, and $7.6 million in fiscal 2011, 2010, and 2009, respectively.
The Company also has an Incentive Compensation Plan which provides cash awards to key management and employees based
on Company and individual performance.
The Company also makes available to management a Non-qualified Deferred Compensation Plan which allows management
to make payroll contributions on a pre-tax basis in addition to the 401(k) plan. Other long-term assets include $67.5 million and
$63.6 million at January 28, 2012 and January 29, 2011, respectively, of long-term plan investments, at market value, set aside or
designated for the Non-qualified Deferred Compensation Plan (See Note B). Plan investments are designated by the participants,
and investment returns are not guaranteed by the Company. The Company has a corresponding liability to participants of
$67.5 million and $63.6 million at January 28, 2012 and January 29, 2011, respectively, included in other long-term liabilities in the
consolidated balance sheets.
In addition, the Company has certain individuals who receive or will receive post-employment medical benefits. The estimated
liability for these benefits of $5.7 million and $4.9 million is included in accrued liabilities and other in the accompanying
consolidated balance sheets as of January 28, 2012 and January 29, 2011, respectively.