v2.4.0.8

Income Taxes | 12 Months Ended
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Dec. 28, 2013
Income Tax Disclosure [Abstract] |
Income Taxes | Note 12 – Income Taxes Income before taxes, equity in earnings of affiliates and loss on sale of equity investment was as follows:
|  | Years ended
|  | December 28, |  | December 29, |  | December 31,
|  | 2013 |  | 2012 |  | 2011
Domestic | $ | 517,950 |  | $ | 466,457 |  | $ | 403,171
Foreign |  | 146,744 |  |  | 137,731 |  |  | 166,136
| Total | $ | 664,694 |  | $ | 604,188 |  | $ | 569,307
The provisions for income taxes were as follows:
|  |  |  |  | Years ended
|  |  |  |  | December 28, |  | December 29, |  | December 31,
|  |  |  |  | 2013 |  | 2012 |  | 2011
Current income tax expense: |  |  |  |  |  |  |  |  |
| U.S. Federal |  | $ | 139,253 |  | $ | 121,591 |  | $ | 125,148
| State and local |  |  | 27,272 |  |  | 23,279 |  |  | 30,423
| Foreign |  |  | 35,880 |  |  | 32,916 |  |  | 43,960
|  | Total current |  |  | 202,405 |  |  | 177,786 |  |  | 199,531
Deferred income tax expense (benefit): |  |  |  |  |  |  |  |  |
| U.S. Federal |  |  | 10,325 |  |  | 9,242 |  |  | (12,466)
| State and local |  |  | (4,531) |  |  | 946 |  |  | (1,782)
| Foreign |  |  | (17,308) |  |  | (116) |  |  | (5,071)
|  | Total deferred |  |  | (11,514) |  |  | 10,072 |  |  | (19,319)
|  |  | Total provision |  | $ | 190,891 |  | $ | 187,858 |  | $ | 180,212
The tax effects of temporary differences that give rise to our deferred income tax asset (liability) were as follows:
|  |  |  | Years Ended
|  |  |  | December 28, |  | December 29,
|  |  |  | 2013 |  | 2012
Current deferred income tax assets: |  |  |  |  |  |
| Inventory, premium coupon redemptions and accounts receivable |  |  |  |  |  |
|  | valuation allowances |  | $ | 31,016 |  | $ | 27,820
| Uniform capitalization adjustments to inventories |  |  | 7,318 |  |  | 9,944
| Other current assets |  |  | 21,351 |  |  | 21,035
| Current deferred income tax asset (1) |  |  | 59,685 |  |  | 58,799
Non-current deferred income tax asset (liability): |  |  |  |  |  |
| Property and equipment |  |  | (5,571) |  |  | (5,661)
| Stock-based compensation |  |  | 35,995 |  |  | 42,875
| Other non-current liabilities |  |  | (211,180) |  |  | (215,562)
| Net operating losses of domestic subsidiaries |  |  | 693 |  |  | 2,768
| Net operating losses of foreign subsidiaries |  |  | 45,254 |  |  | 47,101
|  | Total non-current deferred tax liability |  |  | (134,809) |  |  | (128,479)
|  | Valuation allowance for non-current deferred tax assets (2) |  |  | (16,285) |  |  | (30,598)
| Net non-current deferred tax liability (1) |  |  | (151,094) |  |  | (159,077)
Net deferred income tax liability |  | $ | (91,409) |  | $ | (100,278)
(1) | Certain deferred tax amounts do not have a right of offset and are therefore reflected on a gross basis in current assets
| and non-current liabilities in our consolidated balance sheets.
(2) | Primarily relates to operating losses of acquired foreign subsidiaries, the benefits of which are uncertain. Any future reductions
| of such valuation allowances will be reflected as a reduction of income tax expense in accordance with the provisions of
| ASC Topic 805, “Business Combinations.”
The assessment of the amount of value assigned to our deferred tax assets under the applicable accounting rules is judgmental. We are required to consider all available positive and negative evidence in evaluating the likelihood that we will be able to realize the benefit of our deferred tax assets in the future. Such evidence includes scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and the results of recent operations. Since this evaluation requires consideration of events that may occur some years into the future, there is an element of judgment involved. Realization of our deferred tax assets is dependent on generating sufficient taxable income in future periods. We believe that it is more likely than not that future taxable income will be sufficient to allow us to recover substantially all of the value assigned to our deferred tax assets. However, if future events cause us to conclude that it is not more likely than not that we will be able to recover all of the value assigned to our deferred tax assets, we will be required to adjust our valuation allowance accordingly. As of December 28, 2013, we have state net operating loss carryforwards of $6.9 million relating to our domestic subsidiaries, which can be utilized against future state income through December 31, 2029. As of December 28, 2013, we have foreign net operating loss carryforwards of $11.7 million, which can be utilized against future foreign income through December 31, 2019. Add it i onally, as of December 28, 2013, there were foreign net operating loss carryforwards of $153.1 million that have an indefinite life. The tax provisions differ from the amount computed using the federal statutory income tax rate as follows:
|  |  | Years ended
|  |  | December 28, |  | December 29, |  | December 31,
|  |  | 2013 |  | 2012 |  | 2011
Income tax provision at federal statutory rate |  | $ | 232,644 |  | $ | 211,466 |  | $ | 199,256
State income tax provision, net of federal income tax effect |  |  | 20,134 |  |  | 21,665 |  |  | 18,035
Foreign income tax benefit |  |  | (19,635) |  |  | (17,979) |  |  | (20,169)
Valuation allowance |  |  | (14,026) |  |  | 1,502 |  |  | 442
Interest expense related to loans |  |  | (23,723) |  |  | (21,018) |  |  | (14,394)
Other |  |  | (4,503) |  |  | (7,778) |  |  | (2,958)
| Total income tax provision |  | $ | 190,891 |  | $ | 187,858 |  | $ | 180,212
For the year ended December 28, 2013, our effective tax rate was 28.7% compared to 31.1% for the prior year period. During the third quarter of 2013, we concluded that it is more likely than not that certain deferred tax assets related to tax loss carryforwards originating outside the United States, which had been previously reserved, will be realized. As a result, our provision for income taxes includes a $13.4 million reduction of the valuation allowance which is based on an estimate of future taxable income available to be offset by the tax loss carryforwards. Absent the effects of the reduction of this valuation allowance in the third quarter of 2013, our effective tax rate for the year ended December 28, 2013 would have been 30.7% as compared to our actual effective tax rate of 28.7%. The remaining difference between our effective tax rates and the federal statutory tax rates for both periods primarily relates to state and foreign income taxes and interest expense. Provision has not been made for U.S. or additional foreign taxes on undistributed earnings of foreign subsidiaries, which have been, and will continue to be reinvested. These earnings could become subject to additional tax if they were remitted as dividends, if foreign earnings were loaned to us or a U.S. affiliate, or if we should sell, transfer or dispose of our stock in the foreign subsidiaries. It is not practicable to determine the amount of additional tax, if any, that might be payable on the foreign earnings because if we were to repatriate these earnings, we believe there would be various methods available to us, each with different U.S. tax consequences. As of December 28, 2013, the cumulative amount of reinvested earnings was approximately $694.2 million. ASC Topic 740 clarifies the accounting for uncertainty in income taxes recognized in the financial statements in accordance with other provisions contained within this guidance. This topic prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by the taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate audit settlement. In the normal course of business, our tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax and interest assessments by these taxing authorities for uncertain tax positions taken in respect to certain tax matters. The total amount of unrecognized tax benefits as of December 28, 2013 was approximately $54.1 million, of which $40.3 million would affect the effective tax rate if recognized. It is expected that the amount of unrecognized tax benefits will change in the next 12 months; however, we do not expect the change to have a material impact on our consolidated financial statements. The total amounts of interest and penalties, which are classified as a component of the provision for income taxes, were approximately $10.9 million and $0, respectively, as of December 28, 2013. The tax years subject to examination by major tax jurisdictions include the years 2009 and forward by the U.S. Internal Revenue Service, the years 2000 and forward for certain states and the years 2005 and forward for certain foreign jurisdictions. The following table provides a reconciliation of unrecognized tax benefits excluding the effects of deferred taxes, interest and penalties:
|  | December 28, |  | December 29,
|  | 2013 |  | 2012
Balance, beginning of period |  | $ | 32,700 |  | $ | 19,200
Additions based on current year tax positions |  |  | 6,000 |  |  | 4,900
Additions based on prior year tax positions |  |  | 9,600 |  |  | 11,200
Reductions based on prior year tax positions |  |  | (1,100) |  |  | (600)
Reductions resulting from settlements with taxing authorities |  |  | (800) |  |  | (1,300)
Reductions resulting from lapse in statutes of limitations |  |  | (3,200) |  |  | (700)
Balance, end of period |  | $ | 43,200 |  | $ | 32,700

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- 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 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 2: 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 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 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 Reference 6: 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 + Details
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