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INCOME TAXES (Tables) | 12 Months Ended
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Oct. 29, 2017
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:
|  | 2017 |  | 2016 |  | 2015 |
Current: |  |  |  |  |  |  |  |  |  |
U.S.: |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 360 |  | $ | 51 |  | $ | 377 |
State |  |  | 48 |  |  | 26 |  |  | 32 |
Foreign |  |  | 463 |  |  | 340 |  |  | 449 |
Total current |  |  | 871 |  |  | 417 |  |  | 858 |
Deferred: |  |  |  |  |  |  |  |  |  |
U.S.: |  |  |  |  |  |  |  |  |  |
Federal |  |  | 59 |  |  | 297 |  |  | 21 |
State |  |  | 7 |  |  | 11 |  |  | 4 |
Foreign |  |  | 34 |  |  | (25) |  |  | (43) |
Total deferred |  |  | 100 |  |  | 283 |  |  | (18) |
Provision for income taxes |  | $ | 971 |  | $ | 700 |  | $ | 840 |
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:
|  | 2017 |  | 2016 |  | 2015 |
U.S. federal income tax provision at a statutory rate of 35 percent |  | $ | 1,104 |  | $ | 778 |  | $ | 973 |
Increase (decrease) resulting from: |  |  |  |  |  |  |  |  |  |
State and local income taxes, net of federal income tax benefit |  |  | 35 |  |  | 26 |  |  | 23 |
Differences in taxability of foreign earnings |  |  | (83) |  |  | (107) |  |  | (449) |
Nondeductible impairment charges |  |  |  |  |  | 4 |  |  |  |
Research and business tax credits |  |  | (63) |  |  | (57) |  |  | (76) |
Tax rates on foreign earnings |  |  | (86) |  |  | (27) |  |  | (36) |
Valuation allowance on deferred taxes |  |  | 89 |  |  | 79 |  |  | 384 |
Other-net |  |  | (25) |  |  | 4 |  |  | 21 |
Provision for income taxes |  | $ | 971 |  | $ | 700 |  | $ | 840 |
Analysis of the Deferred Income Tax Assets and Liabilities | An analysis of the deferred income tax assets and liabilities at October 29, 2017 and October 30, 2016 in millions of dollars follows:
|  | 2017 |  | 2016 |
|  | Deferred |  | Deferred |  | Deferred |  | Deferred |
|  | Tax |  | Tax |  | Tax |  | Tax |
|  | Assets |  | Liabilities |  | Assets |  | Liabilities |
Other postretirement benefit liabilities |  | $ | 2,011 |  |  |  |  | $ | 2,191 |  |  |  |
Lease transactions |  |  |  |  | $ | 933 |  |  |  |  | $ | 817 |
Tax loss and tax credit carryforwards |  |  | 677 |  |  |  |  |  | 661 |  |  |  |
Accrual for sales allowances |  |  | 680 |  |  |  |  |  | 592 |  |  |  |
Tax over book depreciation |  |  |  |  |  | 569 |  |  |  |  |  | 578 |
Pension liability - net |  |  | 420 |  |  |  |  |  | 706 |  |  |  |
Foreign unrealized losses |  |  | 7 |  |  |  |  |  | 472 |  |  |  |
Accrual for employee benefits |  |  | 141 |  |  |  |  |  | 133 |  |  |  |
Share-based compensation |  |  | 116 |  |  |  |  |  | 152 |  |  |  |
Goodwill and other intangible assets |  |  |  |  |  | 130 |  |  |  |  |  | 89 |
Allowance for credit losses |  |  | 107 |  |  |  |  |  | 88 |  |  |  |
Deferred compensation |  |  | 59 |  |  |  |  |  | 50 |  |  |  |
Undistributed foreign earnings |  |  |  |  |  | 21 |  |  |  |  |  | 30 |
Other items |  |  | 432 |  |  | 172 |  |  | 471 |  |  | 175 |
Less valuation allowances |  |  | (620) |  |  |  |  |  | (1,029) |  |  |  |
Deferred income tax assets and liabilities |  | $ | 4,030 |  | $ | 1,825 |  | $ | 4,487 |  | $ | 1,689 |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the total amounts of unrecognized tax benefits at October 29, 2017, October 30, 2016, and November 1, 2015 in millions of dollars follows:
|  | 2017 |  | 2016 |  | 2015 |
Beginning of year balance |  | $ | 198 |  | $ | 229 |  | $ | 213 |
Increases to tax positions taken during the current year |  |  | 35 |  |  | 14 |  |  | 32 |
Increases to tax positions taken during prior years |  |  | 13 |  |  | 11 |  |  | 29 |
Decreases to tax positions taken during prior years |  |  | (17) |  |  | (36) |  |  | (15) |
Decreases due to lapse of statute of limitations |  |  | (11) |  |  | (7) |  |  | (11) |
Settlements |  |  | (1) |  |  | (5) |  |  | (6) |
Foreign exchange |  |  | 4 |  |  | (8) |  |  | (13) |
End of year balance |  | $ | 221 |  | $ | 198 |  | $ | 229 |

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