Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

v2.4.0.6
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2012
Income Tax Disclosure [Abstract]  
Schedule of earnings (loss) before income taxes by jurisdiction
The sources of Earnings (loss) before income taxes were as follows:
(in millions)
2012
 
2011
 
2010
United States
$
134.0

 
$
45.7

 
$
(99.3
)
Foreign
47.0

 
65.0

 
61.2

Earnings (loss) before income taxes
$
181.0

 
$
110.7

 
$
(38.1
)
Schedule of components of income tax expense (benefit)
The Income tax provision consisted of the following:
(in millions)
2012
 
2011
 
2010
Current tax expense:
 
 
 
 
 
U.S. Federal
$
4.1

 
$
—

 
$
0.2

State and local
2.2

 
1.6

 
1.3

Foreign
19.0

 
19.2

 
18.8

Total current
25.3

 
20.8

 
20.3

 
 
 
 
 
 
Deferred tax expense (benefit):
 
 
 
 
 
U.S. Federal
11.7

 
6.0

 
3.8

State and local
(0.9
)
 
0.8

 
1.3

Foreign
(2.5
)
 
(7.5
)
 
0.5

Total deferred
8.3

 
(0.7
)
 
5.6

 
 
 
 
 
 
Total provision
$
33.6

 
$
20.1

 
$
25.9

Schedule of deferred tax assets and liabilities
Temporary differences and carryforwards giving rise to deferred tax assets and liabilities at December 31, 2012 and 2011, were as follows:
(in millions)
2012
 
2011
Current deferred tax assets:
 
 
 
Product warranties
$
48.1

 
$
48.5

Sales incentives and discounts
26.8

 
23.6

Other
81.5

 
86.7

Gross current deferred tax assets
156.4

 
158.8

Valuation allowance
(130.1
)
 
(135.8
)
Total net current deferred tax assets
26.3

 
23.0

 
 
 
 
Current deferred tax liabilities:
 
 
 
Other
(7.5
)
 
(8.0
)
Total current deferred tax liabilities
(7.5
)
 
(8.0
)
Total net current deferred taxes
$
18.8

 
$
15.0

 
 
 
 
Non-current deferred tax assets:
 
 
 
Pension
$
183.3

 
$
196.0

Loss carryforwards
107.3

 
147.9

Tax credit carryforwards
156.2

 
158.2

Postretirement and postemployment benefits
28.8

 
34.1

Equity compensation
25.7

 
23.4

Other
68.6

 
48.5

Gross non-current deferred tax assets
569.9

 
608.1

Valuation allowance
(587.4
)
 
(592.6
)
  Total net non-current deferred tax assets
(17.5
)
 
15.5

 
 
 
 
Non-current deferred tax liabilities:
 
 
 
Unremitted foreign earnings and withholding
(29.9
)
 
(33.3
)
State and local income taxes
(35.0
)
 
(34.9
)
Other
(10.3
)
 
(29.3
)
Total non-current deferred tax liabilities
(75.2
)
 
(97.5
)
 
 
 
 
Total net non-current deferred taxes
$
(92.7
)
 
$
(82.0
)
Reconciliation of unrecognized tax benefits
The following is a reconciliation of the total amounts of unrecognized tax benefits excluding interest and penalties for the 2012 and 2011 annual reporting periods:
(in millions)
2012
 
2011
Balance at January 1
$
24.4

 
$
32.0

Gross increases - tax positions prior periods
3.7

 
3.9

Gross decreases - tax positions prior periods
(1.4
)
 
(6.0
)
Gross increases - current period tax positions
1.5

 
1.0

Decreases - settlements with taxing authorities
(2.2
)
 
(5.0
)
Reductions - lapse of statute of limitations
(1.1
)
 
(1.5
)
Other - CTA
(0.2
)
 
(0.0
)
Balance at December 31
$
24.7

 
$
24.4

Reconciliation of income taxes at the statutory Federal income tax rate to income tax expense (benefit)
The difference between the actual income tax provision and the tax provision (benefit) computed by applying the statutory Federal income tax rate to Earnings (loss) before income taxes is attributable to the following:
(in millions)
2012
 
2011
 
2010
Income tax provision (benefit) at 35 percent
$
63.4

 
$
38.7

 
$
(13.3
)
State and local income taxes, net of Federal income tax effect
0.1

 
(0.1
)
 
(5.5
)
Deferred tax asset valuation allowance
(31.2
)
 
(6.1
)
 
62.7

Income attributable to domestic production activities
(2.8
)
 
—

 
—

Asset dispositions and write-offs
—

 
(13.1
)
 
(2.1
)
Change in estimates related to prior years and prior years amended tax return filings
(1.4
)
 
(0.4
)
 
1.1

Federal and state tax credits
(0.3
)
 
(5.9
)
 
(21.3
)
Taxes related to foreign income, net of credits
4.9

 
2.0

 
8.0

Taxes related to unremitted earnings
(3.4
)
 
6.8

 
(5.3
)
Tax reserve reassessment
3.8

 
(5.8
)
 
0.2

Other
0.5

 
4.0

 
1.4

Actual income tax provision
$
33.6

 
$
20.1

 
$
25.9

 
 
 
 
 
 
Effective tax rate
18.6
%
 
18.2
%
 
(68.0
)%
Income tax provision (benefit) allocated to continuing and discontinued operations
Income tax provision (benefit) allocated to continuing operations and discontinued operations for the years ended December 31 was as follows:
(in millions)
2012
 
2011
 
2010
Continuing operations
$
33.6

 
$
20.1

 
$
25.9

Discontinued operations
0.7

 
(2.7
)
 
—

Total tax provision
$
34.3

 
$
17.4

 
$
25.9