Sunbeam 2009 Annual Report Download - page 62

Notes to Consolidated Financial Statements
Jarden Corporation Annual Report 2009 (Dollars in millions, except per share data and unless otherwise indicated)
Litigation
The Company and/or its subsidiaries are involved in various lawsuits arising from time to time that the Company considers ordinary
routine litigation incidental to its business. Amounts accrued for litigation matters represent the anticipated costs (damages and/or settle-
ment amounts) in connection with pending litigation and claims and related anticipated legal fees for defending such actions. The costs are
accrued when it is both probable that a liability has been incurred and the amount can be reasonably estimated. The accruals are based
upon the Company’s assessment, after consultation with counsel (if deemed appropriate), of probable loss based on the facts and
circumstances of each case, the legal issues involved, the nature of the claim made, the nature of the damages sought and any relevant
information about the plaintiffs and other significant factors that vary by case. When it is not possible to estimate a specific expected cost
to be incurred, the Company evaluates the range of probable loss and records the minimum end of the range. The Company believes that
anticipated probable costs of litigation matters have been adequately reserved to the extent determinable. Based on current information,
the Company believes that the ultimate conclusion of the various pending litigation of the Company, in the aggregate, will not have a
material adverse effect on the consolidated financial position, results of operations or cash flows of the Company.
Product Liability
As a consumer goods manufacturer and distributor, the Company and/or its subsidiaries face the risk of product liability and related
lawsuits involving claims for substantial money damages, product recall actions and higher than anticipated rates of warranty returns or
other returns of goods.
The Company and/or its subsidiaries are therefore party to various personal injury and property damage lawsuits relating to their
products and incidental to its business. Annually, the Company sets its product liability insurance program which is an occurrence-based
program based on the Company and its subsidiaries’ current and historical claims experience and the availability and cost of insurance. The
Company’s product liability insurance program generally includes a self-insurance retention per occurrence.
Cumulative amounts estimated to be payable by the Company with respect to pending and potential claims for all years in which
the Company is liable under its self-insurance retention have been accrued as liabilities. Such accrued liabilities are based on estimates
(which include actuarial determinations made by an independent actuarial consultant as to liability exposure, taking into account prior
experience, number of claims and other relevant factors); thus, the Company’s ultimate liability may exceed or be less than the amounts
accrued. The methods of making such estimates and establishing the resulting liability are reviewed on a regular basis and any adjustments
resulting therefrom are reflected in current operating results.
Based on current information, the Company believes that the ultimate conclusion of the various pending product liability claims
and lawsuits of the Company, in the aggregate, will not have a material adverse effect on the consolidated financial position, results of
operations or cash flows of the Company.
12. Taxes on Income
The components of the provision for income taxes attributable to continuing operations were as follows:
Years Ended December 31,
(In millions) 2009 2008 2007
Current income tax expense:
U.S. federal $ (7.9) $ 0.5 $ 5.6
Foreign 55.4 62.1 49.2
State and local 2.0 0.2 1.1
Total 49.5 62.8 55.9
Deferred income tax expense (benefit):
U.S. federal 54.1 (19.9) (11.2)
State, local and other, net of federal tax benefit 8.3 (3.9) (2.9)
Foreign (1.2) (12.7) (3.3)
Total 61.2 (36.5) (17.4)
Total income tax provision $110.7 $ 26.3 $ 38.5
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