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56
Notes to Consolidated Financial Statements
Jarden Corporation Annual Report 2011 (Dollars in millions, except per share data and unless otherwise indicated)
The difference between the federal statutory income tax rate and the Company’s reported income tax rate as a percentage of
income from operations for 2011, 2010 and 2009 is reconciled as follows:
2011 2010 2009
Federal statutory tax rate 35.0% 35.0% 35.0%
Increase (decrease) in rates resulting from:
State and local taxes, net 1.6 1.8 0.4
Foreign rate differences (3.1) (3.8) (2.3)
Non-deductible compensation 1.0 3.5 3.3
Foreign earnings not permanently reinvested 3.4 6.8 10.7
Tax settlements and related adjustments — — (3.6)
Goodwill impairment 3.4 — —
Valuation allowance (2.3) (0.3) 1.4
Venezuela devaluation and inflationary adjustments and tax exempt income (1.5) 5.9 (5.4)
Foreign dividends 1.3 0.9 7.7
Non-deductible transaction costs — 3.1 —
Other (0.8) 0.6 (1.0)
Reported income tax rate 38.0% 53.5% 46.2%
Foreign pre-tax income was approximately $250, $115, and $218 for 2011, 2010 and 2009, respectively.
Deferred tax assets (liabilities) at December 31, 2011 and 2010 are comprised of the following:
(In millions) 2011 2010
Intangibles $ (370.8) $ (375.6)
Goodwill (110.1) (92.6)
Financial reporting amount of a subsidiary in excess of tax basis (71.6) (71.6)
Foreign earnings not permanently reinvested (45.6) (38.1)
Property and equipment (13.4) (14.8)
Other (6.9) (6.6)
Gross deferred tax liabilities (618.4) (599.3)
Net operating loss 40.0 73.2
Accounts receivable allowances 13.3 14.7
Inventory valuation 56.7 51.8
Pension and postretirement 41.5 43.0
Stock-based compensation 17.9 10.1
Other compensation and benefits 21.2 19.7
Operating reserves 60.6 57.9
Other 79.9 72.2
Gross deferred tax assets 331.1 342.6
Valuation allowance (26.9) (35.3)
Net deferred tax liability $ (314.2) $ (292.0)