Seagate 2007 Annual Report Download - page 97
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Table of Contents
SEAGATE TECHNOLOGY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
—
(
Continued)
trust are recorded as other income or expense in the Company’s financial statements. The corresponding gain or loss on deferred compensation
plan liabilities is offset against compensation expenses in cost of revenue and operating expenses. At June 27, 2008 and June 29, 2007, the
deferred compensation amounts related to the rabbi trust included in Other Assets, net on the accompanying balance sheets were approximately
$132 million and $136 million, respectively. At June 27, 2008 and June 29, 2007, the deferred compensation obligation related to the rabbi trust
included in Accrued expenses on the accompanying balance sheets were approximately $138 million and $139 million, respectively.
4. Income Taxes
The provision for (benefit from) income taxes consisted of the following:
Income before income taxes consisted of the following:
For fiscal year 2008 there were $6 million tax benefits recorded to Additional Paid-In Capital associated with stock option deductions. The
Company did not record a tax expense associated with stock option deductions in fiscal year 2007 compared to $44 million recorded in fiscal
year 2006; the related tax benefit was recorded directly to Additional Paid
-In Capital.
U.S. federal and state deferred tax expense in fiscal year 2008 was $37 million. In fiscal year 2007, the deferred tax benefit of $359 million
includes $319 million of deferred tax benefits resulting from the release of valuation allowance recorded in prior years. The fiscal year 2007
valuation allowance release was largely due to the completion during 2007 of the restructuring of the Company’s intercompany arrangements,
which enables the Company to forecast future U.S. taxable income with greater certainty and U.S. taxable income from the
96
Fiscal Years Ended
June 27,
2008
June 29,
2007
June 30,
2006
(In millions)
Current Tax Expense (Benefit):
U.S. Federal
$
8
$
6
$
35
U.S. State
10
(1
)
7
Foreign
26
8
19
Total Current
$
44
$
13
$
61
Deferred Tax Expense (Benefit):
U.S. Federal
$
34
$
(319
)
$
29
U.S. State
3
(40
)
4
Foreign
(14
)
(6
)
(10
)
Total Deferred
$
23
$
(365
)
$
23
Provision for (Benefit from) income taxes
$
67
$
(352
)
$
84
Fiscal Years Ended
June 27,
2008
June 29,
2007
June 30,
2006
(In millions)
U.S
$
90
$
(125
)
$
(18
)
Foreign
1,239
686
942
$
1,329
$
561
$
924