World Fuel Services 2014 Annual Report Download - page 81

Download and view the complete annual report

Please find page 81 of the 2014 World Fuel Services annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 89

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89

76
If our uncertain tax positions as of December 31, 2014 are settled by the taxing authorities in our favor, our income tax
expense would be reduced by $22.0 million (exclusive of interest and penalties) in the period the matter is considered settled
in accordance with Accounting Standards Codification 740. This would have the impact of reducing our 2014 effective
income tax rate by 8.2%. As of December 31, 2014, it does not appear that the total amount of our unrecognized income
tax benefits will significantly increase or decrease within the next twelve months.
We record accrued interest and penalties related to unrecognized income tax benefits as income tax expense. Related to
the uncertain income tax benefits noted above, for interest we recorded income of $0.6 million, $0.6 million and $0.7 million
during 2014, 2013 and 2012, respectively. For penalties, we recorded income of $0.3 million, $0.3 million and $1.5 million
during 2014, 2013 and 2012, respectively. As of December 31, 2014 and 2013, we had recognized liabilities of $4.2 million
and $4.9 million for interest and $4.5 million and $4.8 million for penalties, respectively.
In many cases, our uncertain tax positions are related to tax years that remain subject to examination by the relevant taxing
authorities. The following table summarizes these open tax years by jurisdiction with major uncertain tax positions:
Open Tax Year
Examination Examination not
Jurisdiction in progress yet initiated
United States 2011 2012 - 2014
Singapore None 2011 - 2014
United Kingdom None 2004 - 2014
Brazil 2009 2010 - 2014
Chile None 2009 - 2014
Denmark 2011 2012 - 2014
10. Fair Value Measurements
The carrying amounts of cash and cash equivalents, accounts receivable, net, accounts payable and accrued expenses
and other current liabilities approximate fair value based on the short-term maturities of these instruments. We believe the
carrying values of our debt and notes receivable approximate fair value since these instruments bear interest either at
variable rates or fixed rates which are not significantly different than market rates. Based on the fair value hierarchy, our
debt of $689.9 million as of December 31, 2014 and $463.7 million as of December 31, 2013 and our notes receivable of
$7.0 million as of December 31, 2014 and $20.9 million as of December 31, 2013 are categorized in Level 3.