Seagate 2004 Annual Report Download - page 86

Download and view the complete annual report

Please find page 86 of the 2004 Seagate annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 124

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124

Table of Contents
SEAGATE TECHNOLOGY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
4. Income Taxes
Certain U.S. subsidiaries of the Company have been included in certain unitary and combined U.S. state tax returns with certain U.S.
affiliates of New SAC and have entered into a tax sharing agreement effective November 23, 2000. Pursuant to the terms of the state tax
sharing agreement (“State Tax Allocation Agreement”), hypothetical U.S. state tax returns (with certain modifications) are calculated as if the
U.S. subsidiaries of the Company were filing on a separate return basis. The Company’s U.S. subsidiaries are required to reimburse
participating New SAC U.S. affiliates to the extent the Company’s U.S. subsidiaries utilize the tax attributes of these U.S. affiliates of New
SAC to reduce their separately computed income tax liabilities within 30 days of the close of the fiscal year such affiliates would have
otherwise been able to utilize their own tax attributes. If New SAC’s participating U.S. affiliates utilize tax attributes of the Company’s U.S.
subsidiaries, the Company’s U.S. subsidiaries will be reimbursed for those tax attributes within 30 days of the close of the fiscal year during
which the Company’s U.S. subsidiaries would have otherwise been able to utilize the tax attributes to reduce their separately computed tax
liabilities.
In January 2005, the remaining U.S. affiliate of New SAC participating in the tax sharing agreement with the Company’s U.S.
subsidiaries, Certance (US) Holdings, Inc. (“Certance”) was sold to a third party and as a result, will not be joining in the filing of any fiscal
2005 unitary or combined U.S. state returns with U.S. subsidiaries of the Company. Pursuant to the terms of the tax sharing agreement, the U.S.
subsidiaries of the Company were reimbursed for their tax attributes used by Certance, whose participation in the tax sharing agreement was
then terminated. As of July 1, 2005, there were no outstanding balances for taxes due to or from any New SAC affiliates to U.S. subsidiaries of
the Company.
The provision for (benefit from) income taxes consisted of the following:
Income before income taxes consisted of the following:
82
Fiscal Year
Ended
July 1,
2005
Fiscal Year
Ended
July 2,
2004
Fiscal Year
Ended
June 27,
2003
(in millions)
Current Tax Expense (Benefit):
U.S. Federal
$
15
$
(107
)
$
—
U.S. State
3
(17
)
—
Foreign
(4
)
7
34
14
(117
)
34
Deferred Tax Expense (Benefit):
U.S. Federal
1
16
(18
)
U.S. State
—
3
(3
)
Foreign
10
(3
)
6
11
16
(15
)
Provision for (benefit from) income taxes
$
25
$
(101
)
$
19
Fiscal Year
Ended
July 1,
2005
Fiscal Year
Ended
July 2,
2004
Fiscal Year
Ended
June 27,
2003
(in millions)
U.S.
$
92
$
14
$
198
Foreign
640
414
462
$
732
$
428
$
660