Western Digital 2011 Annual Report Download - page 73

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Deferred Taxes
Temporary differences and carryforwards, which give rise to a significant portion of deferred tax assets and liabilities
as of July 1, 2011 and July 2, 2010 were as follows (in millions):
2011 2010
Deferred tax assets:
Sales related reserves and accrued expenses not currently deductible ............. $ 51 $ 50
Accrued compensation and benefits not currently deductible .................. 69 44
Domestic net operating loss (“NOL”) carryforward ......................... 49 52
Business credit carryforward ......................................... 145 137
Other ......................................................... 53 47
Total deferred tax assets ............................................ 367 330
Deferred tax liabilities:
Depreciation . ................................................... (116) (58)
Other ......................................................... (10) (11)
Total deferred tax liabilities.......................................... (126) (69)
Deferred tax assets, net ........................................... $241 $261
2011 2010
Deferred tax assets:
Current portion (included in other current assets) .......................... $108 $ 81
Non-current portion (included in other non-current assets).................... 259 249
Total deferred tax assets ............................................ 367 330
Deferred tax liabilities:
Current portion (included in other current assets) .......................... (2) (2)
Non-current portion (included in other non-current assets).................... (124) (67)
Total deferred tax liabilities.......................................... (126) (69)
Deferred tax assets, net ........................................... $241 $261
In addition to the deferred tax assets presented above, the Company had additional NOL benefits related to stock-
based compensation deductions of $110 million and $93 million at July 1, 2011 and July 2, 2010, respectively. The
increase in NOL benefits relates to the current year stock based compensation deductions which will result in a future
benefit of $17 million. This $17 million will be recorded as a credit to shareholders’ equity when an incremental benefit
is recognized after considering all other tax attributes available to the Company.
67
WESTERN DIGITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)