v3.7.0.1

Taxes on Earnings | 6 Months Ended
--- | ---
Apr. 30, 2017
Income Tax Disclosure [Abstract] |
Taxes on Earnings | Taxes on Earnings Provision for Taxes The Company's effective tax rate was 582.2% and 2.4% for the three months ended April 30, 2017 and 2016, respectively, and 152.8% and 7.9% for the six months ended April 30, 2017 and 2016, respectively. During the second quarter of fiscal 2017, as a result of the Everett Transaction, the Company recorded valuation allowances of $473 million on U.S. state deferred tax assets and $110 million of other taxes, which had an unfavorable impact on the Company's tax rates for the three and six months ended April 30, 2017. The Company's effective tax rate generally differs from the U.S. federal statutory rate of 35% due to favorable tax rates associated with certain earnings from the Company's operations in lower-tax jurisdictions throughout the world. The Company has not provided U.S. taxes for all foreign earnings because it plans to reinvest some of those earnings indefinitely outside the U.S. For the three and six months ended April 30, 2017, the Company recorded $506 million and $471 million of net income tax charges, respectively, related to various items discrete to the period. In the second quarter of fiscal 2017, the Company recorded income tax charges of $473 million from valuation allowances on U.S. state deferred tax assets and $110 million of other taxes related to the Everett Transaction, partially offset by income tax benefits of $79 million and $141 million for the three and six months ended April 30, 2017, respectively, on restructuring charges, separation costs and acquisition and other related charges. For the three and six months ended April 30, 2016, the Company recorded $92 million and $174 million, respectively, of net income tax benefits related to various items discrete to the period. These amounts primarily included tax benefits on restructuring charges, separation costs, acquisition and other related charges and tax matters related to the separation from former Parent. Uncertain Tax Positions The Company is subject to income tax in the U.S. and approximately 110 other countries and is subject to routine corporate income tax audits in many of these jurisdictions. In addition, former Parent, whose liabilities for which the Company is jointly and severally liable, is subject to numerous ongoing audits by federal, state and foreign tax authorities. The Company believes it has provided adequate reserves for all tax deficiencies or reductions in tax benefits that could result from federal, state and foreign tax audits. The Company regularly assesses the likely outcomes of these audits in order to determine the appropriateness of the Company’s tax provision. The Company adjusts its uncertain tax positions to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular audit. However, income tax audits are inherently unpredictable and there can be no assurance that the Company will accurately predict the outcome of these audits. The amounts ultimately paid on resolution of an audit could be materially different from the amounts previously included in the Provision for taxes and therefore the resolution of one or more of these uncertainties in any particular period could have a material impact on net income or cash flows. As of April 30, 2017 and October 31, 2016, the amount of unrecognized tax benefits was $11.5 billion and $11.4 billion, respectively, of which up to $3.0 billion and $2.9 billion would affect the Company's effective tax rate if realized as of their respective periods. The Company recognizes interest income from favorable settlements and interest expense and penalties accrued on unrecognized tax benefits in Provision for taxes in the Condensed Consolidated Statements of Earnings. As of April 30, 2017 and October 31, 2016, the Company recorded $403 million and $394 million, respectively, for interest and penalties in the Condensed Consolidated Balance Sheets. The Company engages in continuous discussions and negotiations with taxing authorities regarding tax matters in various jurisdictions. HPE does not expect complete resolution of any U.S. Internal Revenue Service ("IRS") audit cycle within the next 12 months. However, it is reasonably possible that certain federal, foreign and state tax issues may be concluded in the next 12 months, including issues involving transfer pricing, joint and several tax liabilities related to the separation from former Parent and other matters. Accordingly, the Company believes it is reasonably possible that its existing unrecognized tax benefits may be reduced by an amount up to $2.7 billion within the next 12 months. Deferred Tax Assets and Liabilities Deferred tax assets and liabilities included in the Condensed Consolidated Balance Sheets were as follows:
| As of
| April 30, 2017 |  | October 31, 2016
| In millions
Deferred tax assets - long-term | $ | 3,491 |  |  | $ | 3,830 |
Deferred tax liabilities - long-term | (83 | ) |  | (98 | )
Deferred tax assets net of deferred tax liabilities | $ | 3,408 |  |  | $ | 3,732 |
The Company periodically engages in intercompany advanced royalty payment and licensing arrangements that may result in advance payments between subsidiaries in different tax jurisdictions. When the local tax treatment of the intercompany licensing arrangements differs from U.S. GAAP treatment, deferred taxes are recognized. Hewlett Packard Enterprise executed intercompany advanced royalty payment arrangements resulting in advanced payments of $439 million during fiscal 2017 and $3.7 billion during fiscal 2016. In these transactions, the payments were received in the U.S. from a foreign consolidated affiliate, with a deferral of intercompany revenues over the term of the arrangements, approximately 5 years. Intercompany royalty revenue and the amortization expense related to the licensing rights are eliminated in consolidation. Tax Matters Agreement and Other Income Tax Matters In connection with the Separation, the Company entered into a Tax Matters Agreement with HP Inc., formerly Hewlett-Packard Company. In connection with the Everett Transaction, the Company entered into a DXC Tax Matters Agreement with DXC. See Note 19, "Guarantees, Indemnifications and Warranties", for a full description of the Tax Matters Agreement and the DXC Tax Matters Agreement.

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=6907707&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=6907707&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=6907707&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=6907707&loc=d3e32537-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration