XML 40 R21.htm IDEA: XBRL DOCUMENT
v3.5.0.2

Income Taxes | 12 Months Ended
--- | ---
Oct. 02, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Components of earnings before income taxes (in millions):
Fiscal Year Ended | Oct 2, 2016 |  | Sep 27, 2015 |  | Sep 28, 2014
United States | $ | 3,415.7 |  |  | $ | 2,837.2 |  |  | $ | 2,572.4 |
Foreign | 782.9 |  |  | 1,065.8 |  |  | 587.3 |
Total earnings before income taxes | $ | 4,198.6 |  |  | $ | 3,903.0 |  |  | $ | 3,159.7 |
Provision/(benefit) for income taxes (in millions):
Fiscal Year Ended | Oct 2, 2016 |  | Sep 27, 2015 |  | Sep 28, 2014
Current taxes: |  |  |  |  |
U.S. federal | $ | 704.1 |  |  | $ | 801.0 |  |  | $ | 822.7 |
U.S. state and local | 166.5 |  |  | 150.1 |  |  | 132.9 |
Foreign | 218.5 |  |  | 172.2 |  |  | 128.8 |
Total current taxes | 1,089.1 |  |  | 1,123.3 |  |  | 1,084.4 |
Deferred taxes: |  |  |  |  |
U.S. federal | 351.3 |  |  | 56.5 |  |  | 12.0 |
U.S. state and local | 25.8 |  |  | 4.0 |  |  | (4.9 | )
Foreign | (86.5 | ) |  | (40.1 | ) |  | 0.5 |
Total deferred taxes | 290.6 |  |  | 20.4 |  |  | 7.6 |
Total income tax expense | $ | 1,379.7 |  |  | $ | 1,143.7 |  |  | $ | 1,092.0 |
Reconciliation of the statutory U.S. federal income tax rate with our effective income tax rate:
Fiscal Year Ended | Oct 2, 2016 |  | Sep 27, 2015 |  | Sep 28, 2014
Statutory rate | 35.0 | % |  | 35.0 | % |  | 35.0 | %
State income taxes, net of federal tax benefit | 3.0 |  |  | 2.8 |  |  | 2.6 |
Benefits and taxes related to foreign operations | (2.2 | ) |  | (2.1 | ) |  | (1.9 | )
Domestic production activity deduction | (1.9 | ) |  | (2.2 | ) |  | (0.7 | )
Gain resulting from acquisition of joint venture | — |  |  | (3.7 | ) |  | — |
Other, net | (1.0 | ) |  | (0.5 | ) |  | (0.4 | )
Effective tax rate | 32.9 | % |  | 29.3 | % |  | 34.6 | %
U.S. income and foreign withholding taxes have not been provided on approximately $3.3 billion of cumulative undistributed earnings of foreign subsidiaries and equity investees. We intend to reinvest these earnings for the foreseeable future. If these amounts were distributed to the U.S., in the form of dividends or otherwise, we would be subject to additional U.S. income taxes, which could be material. Determination of the amount of unrecognized deferred income tax liabilities on these earnings is not practicable because of the complexities with its hypothetical calculation, and the amount of liability, if any, is dependent on circumstances existing if and when remittance occurs. Tax effect of temporary differences and carryforwards that comprise significant portions of deferred tax assets and liabilities (in millions):
| Oct 2, 2016 |  | Sep 27, 2015
Deferred tax assets: |  |  |
Property, plant and equipment | $ | 56.8 |  |  | $ | 54.4 |
Accrued occupancy costs | 104.5 |  |  | 95.6 |
Accrued compensation and related costs | 88.6 |  |  | 81.6 |
Stored value card liability | 124.2 |  |  | 97.2 |
Stock-based compensation | 138.3 |  |  | 135.5 |
Net operating losses | 79.0 |  |  | 93.4 |
Litigation charge | 862.3 |  |  | 931.0 |
Other | 197.4 |  |  | 171.3 |
Total | $ | 1,651.1 |  |  | $ | 1,660.0 |
Valuation allowance | (70.3 | ) |  | (143.7 | )
Total deferred tax asset, net of valuation allowance | $ | 1,580.8 |  |  | $ | 1,516.3 |
Deferred tax liabilities: |  |  |
Property, plant and equipment | (445.7 | ) |  | (150.5 | )
Intangible assets and goodwill | (175.9 | ) |  | (176.7 | )
Other | (88.5 | ) |  | (51.7 | )
Total | (710.1 | ) |  | (378.9 | )
Net deferred tax asset | $ | 870.7 |  |  | $ | 1,137.4 |
Reported as: |  |  |
Deferred income tax assets | 885.4 |  |  | 1,180.8 |
Deferred income tax liabilities (included in Other long-term liabilities) | (14.7 | ) |  | (43.4 | )
Net deferred tax asset | $ | 870.7 |  |  | $ | 1,137.4 |
(1) We have adjusted the presentation of certain gross deferred tax assets and liabilities as of September 27, 2015 in the above table to conform to our presentation as of October 2, 2016. The valuation allowance as of October 2, 2016 and September 27, 2015 is primarily related to net operating losses and other deferred tax assets of consolidated foreign subsidiaries. The net change in the total valuation allowance was a decrease of $73.4 million and $23.1 million for fiscal 2016 and 2015, respectively. As of October 2, 2016, we had state tax credit carryforwards of $24.9 million with an expiration date of fiscal 2024 and foreign net operating loss carryforwards of $264.2 million, the majority of which has no expiration date. Uncertain Tax Positions As of October 2, 2016, we had $146.5 million of gross unrecognized tax benefits of which $102.0 million, if recognized, would affect our effective tax rate. We recognized a benefit of $3.6 million, an expense of $0.7 million and an expense of $5.9 million of interest and penalties in income tax expense, prior to the benefit of the federal tax deduction, for fiscal 2016, 2015 and 2014, respectively. As of October 2, 2016 and September 27, 2015, we had accrued interest and penalties of $7.7 million and $11.3 million, respectively, before the benefit of the federal tax deduction, included within other long-term liabilities on our consolidated balance sheets. The following table summarizes the activity related to our unrecognized tax benefits (in millions):
| Oct 2, 2016 |  | Sep 27, 2015 |  | Sep 28, 2014
Beginning balance | $ | 150.4 |  |  | $ | 112.7 |  |  | $ | 88.8 |
Increase related to prior year tax positions | — |  |  | 7.9 |  |  | 1.4 |
Decrease related to prior year tax positions | (23.6 | ) |  | (0.9 | ) |  | (2.2 | )
Increase related to current year tax positions | 33.7 |  |  | 32.0 |  |  | 26.7 |
Decrease related to current year tax positions | — |  |  | (0.6 | ) |  | (1.9 | )
Decreases related to settlements with taxing authorities | (3.1 | ) |  | (0.7 | ) |  | (0.1 | )
Decrease related to lapsing of statute of limitations | (10.9 | ) |  | — |  |  | — |
Ending balance | $ | 146.5 |  |  | $ | 150.4 |  |  | $ | 112.7 |
We are currently under examination, or may be subject to examination, by various jurisdictions inside and outside the U.S. as well as U.S. state and municipal taxing jurisdictions for fiscal years 2006 through 2015. We are no longer subject to U.S. federal or state examination for years prior to fiscal year 2011, with the exception of one city. We are no longer subject to examination in any material international markets prior to 2006. There is a reasonable possibility that $18.6 million of the currently remaining unrecognized tax benefits may be recognized by the end of fiscal 2017 as a result of a lapse of the statute of limitations.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: 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=65882285&loc=d3e32639-109319 Reference 5: 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=65882285&loc=d3e32537-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration