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Income Taxes | 12 Months Ended
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Dec. 31, 2011
Income Taxes [Abstract] |
Income Taxes [Text Block] |
(8) | Income Taxes
Earnings before income taxes for the years ended December 31, 2011, 2010 and 2009 consisted of the following components (in thousands):
|  | 2011 |  | 2010 |  | 2009 |
United States |  | $ | 359,800 |  | $ | 270,281 |  | $ | 210,559 |
Other |  |  | 245,187 |  |  | 178,113 |  |  | 129,209 |
|  | $ | 604,987 |  | $ | 448,394 |  | $ | 339,768 |
Components of income tax expense for the years ended December 31, 2011, 2010 and 2009 were as follows (in thousands):
|  | 2011 |  | 2010 |  | 2009 |
Current: |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 123,310 |  | $ | 93,594 |  | $ | 54,636 |
State |  |  | 14,903 |  |  | 8,185 |  |  | 6,990 |
Foreign |  |  | 41,437 |  |  | 32,706 |  |  | 23,720 |
Deferred: |  |  |  |  |  |  |  |  |  |
Federal |  |  | 1,846 |  |  | (23,107 | ) |  | 14,880 |
Foreign |  |  | (3,756) |  |  | 14,436 |  |  | 61 |
|  | $ | 177,740 |  | $ | 125,814 |  | $ | 100,287 |
Reconciliations between the statutory federal income tax rate and the effective income tax rate for the years ended December 31, 2011, 2010 and 2009 were as follows:
|  | 2011 |  | 2010 |  | 2009 |
Federal statutory rate |  | 35.0 | % | 35.0 | % | 35.0 | %
Foreign rate differential |  | (3.7 | ) | (4.3 | ) | (3.9 | )
R&D tax credits |  | (0.7 | ) | (0.6 | ) | (0.6 | )
State taxes, net of federal benefit |  | 1.7 |  | 1.6 |  | 1.8 |
Foreign tax credit |  | - |  | (2.4 | ) | - |
Other, net |  | (2.9 | ) | (1.2 | ) | (2.8 | )
|  | 29.4 | % | 28.1 | % | 29.5 | %
The deferred income tax balance sheet accounts arise from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. Components of the deferred tax assets and liabilities at December 31 were as follows (in thousands):
|  | 2011 |  | 2010 |
Deferred tax assets: |  |  |  |  |  |  |
Reserves and accrued expenses |  | $ | 72,150 |  | $ | 64,946 |
Inventories |  |  | 7,104 |  |  | 5,947 |
Net operating loss carryforwards |  |  | 20,642 |  |  | 19,600 |
R&D credits |  |  | 1,114 |  |  | 1,047 |
Valuation allowance |  |  | - |  |  | (796 | )
Total deferred tax assets |  | $ | 101,010 |  | $ | 90,744 |
Deferred tax liabilities: |  |  |  |  |  |  |
Reserves and accrued expenses |  | $ | 33,861 |  | $ | 33,884 |
Amortizable intangible assets |  |  | 456,613 |  |  | 435,143 |
Plant and equipment |  |  | 2,677 |  |  | 6,419 |
Total deferred tax liabilities |  | $ | 493,151 |  | $ | 475,446 |
The presentation of the deferred tax assets as of December 31, 2010 has been revised to reflect an adjustment to the classification of certain federal and state net operating losses and state R&D credit carryforwards in 2011. The impact of this adjustment changed the Company's other deferred tax asset classifications by $12.1 million as of December 31, 2010. The adjustment had no impact on Roper's consolidated financial statements. The Company establishes a valuation allowance against its deferred tax asset when it is more likely than not that all or a portion of the deferred tax asset will not be realized. In 2010, the Company recorded a valuation allowance of $0.8 million against a deferred tax asset for certain foreign operations that were in a cumulative loss position. The release of this valuation allowance in 2011 was contemplated after an assessment of both positive and negative evidence as to whether it is more likely than not that the deferred tax assets are recoverable. Based on the weight of available evidence, the Company believes it is more likely than not that the deferred tax asset will be utilized and accordingly, a release of the entire valuation allowance was recorded in the fourth quarter of 2011. At December 31, 2011, Roper has approximately $30.1 million of U.S. federal net operating loss carryforwards. If not utilized, these carryforwards will expire in years 2021 through 2031. The net operating loss carryforward increased between 2010 and 2011 primarily because of losses incurred by a U.S. entity that is not a member of the Company's consolidated tax group and whose losses are therefore not available for offset against the taxable income of other members of the group. Also, due to a recent acquisition, the consolidated group has acquired a net operating loss subject to a Section 382 limitation of the IRC; however, the Company expects to utilize the entire net operating loss prior to expiration. The majority of the state net operating loss carryforward is related to Florida and, if not utilized, will expire in years 2027 through 2030. The Company had smaller net operating losses in various other states. Additionally, Roper has foreign tax credit carryforwards and R&D credit carryforwards. Roper has not recognized a valuation allowance on these attributes since management has determined that it is more likely than not that the results of future operations will generate sufficient taxable income to realize these deferred tax assets. The Company provides income taxes for unremitted earnings of foreign subsidiaries that are not considered permanently reinvested overseas. As of December 31, 2011, the approximate amount of earnings of foreign subsidiaries that the Company considers permanently reinvested and for which deferred taxes have not been provided was approximately $874 million. Because of the availability of U.S. foreign tax credits, it is not practicable to determine the U.S. federal income tax liability that would be payable if such earnings were not reinvested indefinitely. Although it is the Company's intention to permanently reinvest these earnings indefinitely there are certain events that would cause these earnings to become taxable. These events include, but are not limited to, change in U.S. tax laws, dividends paid between foreign subsidiaries in the absence of Section 954(c)(6) of the IRC, foreign subsidiary guarantees of U.S. parent debt and the liquidation of foreign subsidiaries or actual distributions by foreign subsidiaries into a U.S. affiliate. The Company recognizes in the consolidated financial statements only those tax positions determined to be "more likely than not" of being sustained upon examination based on the technical merits of the positions. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):
|  | 2011 |  | 2010 |  | 2009 |
Beginning balance |  | $ | 24,765 |  | $ | 22,922 |  | $ | 22,638 |
Additions for tax positions of prior periods |  |  | 470 |  |  | 203 |  |  | 156 |
Additions for tax positions of the current period |  |  | 2,688 |  |  | 3,169 |  |  | 4,750 |
Additions due to acquisitions |  |  | - |  |  | 3,546 |  |  | - |
Reductions for tax positions of prior periods |  |  | (558 | ) |  | (565 | ) |  | (250 | )
Reductions for tax positions of the current period |  |  | (116) |  |  | - |  |  | - |
Settlements with taxing authorities |  |  | (4,043) |  |  | - |  |  | (224 | )
Lapse of applicable statute of limitations |  |  | (3,650) |  |  | (4,510 | ) |  | (4,148 | )
Ending balance |  | $ | 19,556 |  | $ | 24,765 |  | $ | 22,922 |
The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate is $12.8 million. Interest and penalties related to unrecognized tax benefits are classified as a component of income tax expense and totaled $(0.5) million in 2011. Accrued interest and penalties were $3.5 million at December 31, 2011 and $4.1 million at December 31, 2010. During the next twelve months, it is expected that the unrecognized tax benefits will be reduced by a net $3.8 million, due mainly to a lapse in the applicable statute of limitations. The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of multiple state, city and foreign jurisdictions. The Company's federal income tax returns for 2008 through the current period remain subject to examination and the relevant state, city and foreign statutes vary. There are no current tax examinations in progress where the Company expects the assessment of any significant additional tax in excess of amounts reserved.

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- Definition Description containing the entire income tax disclosure. Examples 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. This element may be used as a single block of text to encapsulate the entire disclosure including data and tables. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 + Details
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