Sunbeam 2002 Annual Report Download - page 42

Jarden Corporation
Notes to Consolidated Financial Statements (Continued)
10. Taxes on Income
The components of the provision (benefit) for income taxes attributable to continuing operations were as
follows for the years ended December 31:
(in thousands) 2002 2001 2000
Current income tax expense (benefit):
U.S. federal .................................................. $13,513 $(13,978) $ (166)
Foreign ..................................................... 692 1,163 462
State and local ............................................... 2,813 (500) (59)
Total ...................................................... 17,018 (13,315) 237
Deferred income tax expense (benefit):
U.S. federal .................................................. (340) (33,707) 1,135
State, local and other. .......................................... (489) (4,962) 187
Total ...................................................... (829) (38,669) 1,322
Income tax benefit applied to goodwill ............................. — 11,541 843
Total income tax provision (benefit) ................................ $16,189 $(40,443) $2,402
Foreign pre-tax income (all arising in Canada) was $1.8 million, $0.9 million, and $2.5 million in 2002,
2001, and 2000, respectively.
Deferred tax liabilities (assets) are comprised of the following at December 31:
(in thousands) 2002 2001
Property, equipment and intangibles ......................................... $ (2,741) $ (9,430)
Other ................................................................... (7,459) (2,314)
Gross deferred tax liabilities .............................................. (10,200) (11,744)
Net operating loss ........................................................ 2,726 39,909
Accounts receivable allowances ............................................. 310 388
Inventory valuation ....................................................... 2,095 1,730
Compensation and benefits ................................................. 7,671 4,010
Other ................................................................... 2,333 1,351
Gross deferred tax assets ................................................. 15,135 47,388
Valuation allowance ...................................................... (1,000) (5,395)
Net deferred tax asset ..................................................... $ 3,935 $ 30,249
Approximately $2.7 million of state net operating loss carryforwards remain at December 31, 2002 before
the valuation allowance. Their use is limited to future taxable income of the Company. The carryforwards
expire in 2021. The Company maintained a valuation allowance against a portion of the net tax benefit
associated with all carryforwards and temporary differences at December 31, 2002, as it is more likely than not
that these will not be fully utilized in the available carryforward period.
As a result of the losses arising from the sale of the TPD Assets, the Company recovered in January 2002
approximately $15.7 million of federal income taxes paid in 1999 and 2000 by utilizing the carryback of a tax
net operating loss generated in 2001. On March 9, 2002, The Job Creation and Workers Assistance Act of 2002
was enacted which provides, in part, for the carryback of 2001 net operating losses for five years instead of the
previous two year period. As a result, the Company filed for an additional refund of $22.8 million, of which
$22.2 million was received in March 2002 and the remainder was received in April 2002.
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