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58 Jarden Corporation Annual Report 2014
Deferred tax assets (liabilities) at December31, 2014 and 2013 are comprised of the following:
(In millions) 2014 2013
Intangibles $(906.4)$(826.9)
Goodwill (159.7)(135.8)
Financial reporting amount of a subsidiary in excess of tax basis (70.4)(70.4)
Foreign earnings not permanently reinvested (5.6)(48.4)
Property and equipment (11.5)(8.8)
Convertible debt (110.4)(41.9)
Other (9.0)(0.4)
 
Gross deferred tax liabilities (1,273.0)(1,132.6)
 
Net operating loss 50.9 47.8
Accounts receivable allowances 13.8 15.0
Inventory valuation 58.9 58.8
Pension and postretirement 17.0 20.0
Stock-based compensation 12.6 23.6
Other compensation and benets 21.3 13.0
Operating reserves 55.4 66.3
Other 38.1 55.7
Gross deferred tax assets 268.0 300.2
Valuation allowance (40.8)(34.2)
Net deferred tax liability $(1,045.8)$(866.6)
Gross deferred tax liabilities as of December 31, 2013 have been revised to correct for an error in the presentation of $41.9 related to
the convertible debt which was previously included within other deferred tax assets.
The Company continually reviews the adequacy of the valuation allowance. A valuation allowance is recorded if, based on the weight
of available evidence, it is more likely than not that a deferred tax asset will not be realized. This assessment is based on an evaluation
of the level of historical taxable income and projections for future taxable income. During 2014, the Company’s valuation allowance
increased by $6.6 principally due to a provision made against the net deferred tax assets of the Company’s operations in Venezuela.
During 2013, the Company’s valuation allowance increased by $6.1 principally due to the inability to recognize certain foreign losses for
which a valuation allowance was previously provided. During 2012, the Company’s valuation allowance increased by $1.2 principally due
to the Company’s inability to recognize the benet of certain current year foreign losses.
The net operating losses (“NOLs”) reected on the deferred tax asset table consist of state and foreign net operating loss
carryforwards. At December31, 2014, the Company had net U.S. federal NOLs of approximately $580, none of which are reected in
the consolidated nancial statements. In 2014, the Company utilized approximately $123 of these previously unrecognized U.S. federal
NOLs in its consolidated nancial statements. Additionally, approximately $470 of these U.S. federal NOLs are subject to varying
limitations on their use under Section382 of the Internal Revenue Code of 1986, as amended. Included in the total NOLs reported on
the nancial statement are $145 of foreign NOLs which the Company has accumulated or acquired through acquisitions. Of the total
foreign NOLs, approximately $1 will expire in 2015. Approximately $59 of the foreign NOLs will expire in years subsequent to 2015, and
approximately $85 have an unlimited life.
Certain vested and exercised employee equity compensation awards have resulted in tax deductions in excess of previously recorded
tax benets based on the value of such equity compensation awards at the time of grant (“windfalls”). The additional tax benet
associated with the windfalls is not recognized for nancial statement purposes until the deduction reduces taxes payable as recorded
on the Company’s nancial statements with an offset to additional paid-in-capital. Windfall tax benets of $38.0, $11.6 and $41.8 were
recognized in 2014, 2013 and 2012, respectively. All previously unrecognized windfall tax benets were recognized in 2012.
Generally, the Company intends to indenitely reinvest undistributed earnings of certain of its foreign subsidiaries outside the U.S. in
the future growth of its foreign businesses. As a result, the Company has not provided for U.S. income taxes on undistributed foreign
earnings of approximately $1.2 billion at December31, 2014. Determination of the amount of unrecognized deferred U.S. income liability
is not practicable, in part, because of the complexities associated with its hypothetical calculation, which include the impact of complex
Notes to Consolidated Financial Statements
Jarden Corporation Annual Report 2014 (Dollars in millions, except per share data and unless otherwise indicated)