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INCOME TAXES (Tables) | 12 Months Ended
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Oct. 31, 2014
INCOME TAXES |
Provision for Income Taxes by Taxing Jurisdiction and by Significant Component | The provision for income taxes by taxing jurisdiction and by significant component consisted of the following in millions of dollars:
|  | 2014 |  | 2013 |  | 2012
Current: |  |  |  |  |  |
U.S.: |  |  |  |  |  |
Federal |  | $ | 1,217 |  | $ | 1,405 |  | $ | 1,277
State |  | 126 |  | 145 |  | 119
Foreign |  | 564 |  | 569 |  | 355
Total current |  | 1,907 |  | 2,119 |  | 1,751
Deferred: |  |  |  |  |  |
U.S.: |  |  |  |  |  |
Federal |  | (189) |  | (117) |  | (76)
State |  | (11) |  | (11) |  | (7)
Foreign |  | (80) |  | (45) |  | (9)
Total deferred |  | (280) |  | (173) |  | (92)
Provision for income taxes |  | $ | 1,627 |  | $ | 1,946 |  | $ | 1,659
Comparison of Statutory and Effective Income Tax Provision | A comparison of the statutory and effective income tax provision and reasons for related differences in millions of dollars follow:
|  | 2014 |  | 2013 |  | 2012
U.S. federal income tax provision at a statutory rate of 35 percent |  | $ | 1,679 |  | $ | 1,919 |  | $ | 1,657
Increase (decrease) resulting from: |  |  |  |  |  |
State and local income taxes, net of federal income tax benefit |  | 75 |  | 87 |  | 73
German branch deferred tax write-off |  |  |  | 56 |  |
Nontaxable foreign partnership (earnings) losses |  | (305) |  | 43 |  | (172)
Nondeductible impairment charges |  | 32 |  | 29 |  | 6
Research and business tax credits |  | (99) |  | (56) |  | (10)
Tax rates on foreign earnings |  | (71) |  | (34) |  | (69)
Valuation allowance on foreign deferred taxes |  | 363 |  | (14) |  | 200
Other-net |  | (47) |  | (84) |  | (26)
Provision for income taxes |  | $ | 1,627 |  | $ | 1,946 |  | $ | 1,659
Analysis of the Deferred Income Tax Assets and Liabilities | An analysis of the deferred income tax assets and liabilities at October 31 in millions of dollars follows:
|  | 2014 |  | 2013
|  | Deferred Tax Assets |  | Deferred Tax Liabilities |  | Deferred Tax Assets |  | Deferred Tax Liabilities
Other postretirement benefit liabilities |  | $ | 1,968 |  |  |  | $ | 1,777 |  |
Tax over book depreciation |  |  |  | $ | 542 |  |  |  | $ | 582
Accrual for sales allowances |  | 654 |  |  |  | 602 |  |
Lease transactions |  |  |  | 404 |  |  |  | 424
Tax loss and tax credit carryforwards |  | 514 |  |  |  | 371 |  |
Accrual for employee benefits |  | 229 |  |  |  | 234 |  |
Pension liability - net |  | 160 |  |  |  |  |  |
Pension asset - net |  |  |  |  |  |  |  | 137
Share-based compensation |  | 145 |  |  |  | 142 |  |
Inventory |  | 22 |  |  |  | 161 |  |
Goodwill and other intangible assets |  |  |  | 89 |  |  |  | 100
Allowance for credit losses |  | 73 |  |  |  | 69 |  |
Deferred gains on distributed foreign earnings |  | 32 |  |  |  | 26 |  |
Deferred compensation |  | 47 |  |  |  | 44 |  |
Undistributed foreign earnings |  |  |  | 26 |  |  |  | 26
Other items |  | 586 |  | 116 |  | 419 |  | 157
Less valuation allowances |  | (637) |  |  |  | (254) |  |
Deferred income tax assets and liabilities |  | $ | 3,793 |  | $ | 1,177 |  | $ | 3,591 |  | $ | 1,426
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the total amounts of unrecognized tax benefits at October 31 in millions of dollars follows:
|  | 2014 |  | 2013 |  | 2012
Beginning of year balance |  | $ | 272 |  | $ | 265 |  | $ | 199
Increases to tax positions taken during the current year |  | 28 |  | 30 |  | 46
Increases to tax positions taken during prior years |  | 20 |  | 24 |  | 54
Decreases to tax positions taken during prior years |  | (84) |  | (51) |  | (14)
Decreases due to lapse of statute of limitations |  | (4) |  | (5) |  | (9)
Foreign exchange |  | (19) |  | 9 |  | (11)
End of year balance |  | $ | 213 |  | $ | 272 |  | $ | 265

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- Definition Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 + Details
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- Definition Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 + Details
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- Definition Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32687-109319 + Details
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