TD Bank 2009 Annual Report Download - page 134

TD BANK FINANCIAL GROUP ANNUAL REPORT 2009 FINANCIAL RESULTS130
The net future tax asset (liability) which is reported in other liabilities
assets is composed of:
Net Future Income Tax Asset (Liability)
(millions of Canadian dollars) 2009 2008
Future income tax assets
Allowance for credit losses $ 678 $ 503
Premises and equipment 170 125
Deferred income –23
Securities 65 1,321
Goodwill 67 76
Employee benefits 545 431
Loss carry forward 141 580
Other 35 –
Total future income tax assets 1,701 3,059
Valuation allowance (124) (80)
Future income tax assets 1,577 2,979
Future income tax liabilities
Intangible assets (898) (1,111)
Deferred income (72) –
Employee benefits (323) (140)
Other (519) (481)
Future income tax liabilities (1,812) (1,732)
Net future income tax asset (liability)1$ (235) $ 1,247
1Included in the October 31, 2009 net future income tax liability are future
income tax assets/(liabilities) of $(473) million (2008 – $193 million) in Canada,
$194 million (2008 – $1,031 million) in the United States and $44 million
(2008 – $23 million) in international jurisdictions.
Earnings of certain subsidiaries would be subject to additional tax only
upon repatriation. The Bank has not recognized a future income tax
liability for this additional tax since it does not currently plan to repa-
triate the undistributed earnings. If all the undistributed earnings
of the operations of these subsidiaries were repatriated, estimated
additional taxes payable would be $462 million as at October 31,
2009 (2008 – $473 million).
Basic earnings per share is calculated by dividing net income available
to common shareholders by the weighted-average number of common
shares outstanding for the period.
Diluted earnings per share is calculated using the same method as
basic earnings per share except that the weighted-average number of
common shares outstanding includes the potential dilutive effect of
stock options granted by the Bank as determined under the treasury
stock method. The treasury stock method determines the number of
additional common shares by assuming that the outstanding stock
options, whose exercise price is less than the average market price of
the Bank’s common stock during the period, are exercised and then
reduced by the number of common shares assumed to be repurchased
with the exercise proceeds. Such potential dilution is not recognized
in a loss period.
EARNINGS PER SHARE
NOTE 29
Basic and Diluted Earnings Per Share
(millions of Canadian dollars, except as noted) 2009 2008 2007
Basic earnings per share
Net income available to common shareholders $ 2,953 $ 3,774 $ 3,977
Average number of common shares outstanding (millions) 847.1 769.6 718.6
Basic earnings per share (Canadian dollars) $ 3.49 $ 4.90 $ 5.53
Diluted earnings per share
Net income available to common shareholders 2,953 3,774 3,977
Average number of common shares outstanding (millions) 847.1 769.6 718.6
Stock options potentially exercisable as determined under the treasury stock method1(millions) 3.0 6.1 6.9
Average number of common shares outstanding – diluted (millions) 850.1 775.7 725.5
Diluted earnings per share1(Canadian dollars) $ 3.47 $ 4.87 $ 5.48
1
For 2009, the computation of diluted earnings per share excluded weighted-average
options outstanding of 14,292 thousand with a weighted-average exercise price of
$64.44 as the option price was greater than the average market price of the Bank’s
common shares. For 2008, the computation of diluted earnings per share excluded
weighted-average options outstanding of 7,077 thousand with a weighted-average
exercise price of $68.94 as the option price was greater than the average market
price of the Bank’s common shares. For 2007, the computation of diluted earnings
per share excluded weighted-average options outstanding of 0.01 thousand with
a weighted-average exercise price of $65.44 as the option price was greater than
the average market price of the Bank’s common shares.