XML 33 R18.htm IDEA: XBRL DOCUMENT
v3.24.4

Income Taxes | 12 Months Ended
--- | ---
Oct. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes |
8 | Income Taxes
Earnings Before Income Taxes Earnings before income taxes were as follows (dollars in millions):
Fiscal Years Ended October 31 |  | 2024 |  | 2023 |  | 2022
Earnings before income taxes: |  |  |  |  |  |
United States |  | $ | 436.6 |  |  | $ | 345.0 |  |  | $ | 491.3 |
Foreign |  | 76.2 |  |  | 55.5 |  |  | 61.2 |
Total earnings before income taxes |  | $ | 512.8 |  |  | $ | 400.5 |  |  | $ | 552.5 |
Reconciliation of Effective Tax Rate A reconciliation of the statutory federal income tax rate to the company's effective tax rate is summarized as follows:
Fiscal Years Ended October 31 |  | 2024 |  | 2023 |  | 2022
Statutory federal income tax rate |  | 21.0 | % |  | 21.0 | % |  | 21.0 | %
Excess deduction for stock-based compensation |  | (0.6) |  |  | (1.1) |  |  | (0.4) |
State and local income taxes, net of federal benefit |  | 2.2 |  |  | 1.8 |  |  | 2.0 |
Foreign operations |  | (1.2) |  |  | (0.7) |  |  | (0.7) |
Federal research tax credit |  | (1.9) |  |  | (2.3) |  |  | (1.3) |
Foreign-derived intangible income |  | (0.9) |  |  | (1.1) |  |  | (0.7) |
Other, net |  | (0.3) |  |  | 0.1 |  |  | (0.1) |
Effective tax rate |  | 18.3 | % |  | 17.7 | % |  | 19.8 | %
Provision for Income Taxes Components of the company's provision for income taxes were as follows (dollars in millions):
Fiscal Years Ended October 31 |  | 2024 |  | 2023 |  | 2022
Current provision: |  |  |  |  |  |
Federal |  | $ | 94.9 |  |  | $ | 94.4 |  |  | $ | 94.7 |
State |  | 18.5 |  |  | 17.0 |  |  | 19.1 |
Foreign |  | 8.4 |  |  | 7.3 |  |  | 7.7 |
Total current provision |  | $ | 121.8 |  |  | $ | 118.7 |  |  | $ | 121.5 |
Deferred (benefit) provision: |  |  |  |  |  |
Federal |  | $ | (23.6) |  |  | $ | (37.8) |  |  | $ | (7.4) |
State |  | (4.6) |  |  | (10.3) |  |  | (4.9) |
Foreign |  | 0.3 |  |  | 0.2 |  |  | — |
Total deferred benefit |  | (27.9) |  |  | (47.9) |  |  | (12.3) |
Total provision for income taxes |  | $ | 93.9 |  |  | $ | 70.8 |  |  | $ | 109.2 |
Deferred Income Taxes The components of the company's deferred income tax assets and liabilities were as follows (dollars in millions):
Fiscal Years Ended October 31 |  | 2024 |  | 2023
Deferred income tax assets: |  |  |  |
Research and experimentation |  | $ | 64.6 |  |  | $ | 35.4 |
Warranty and insurance |  | 40.0 |  |  | 37.6 |
Compensation and benefits |  | 32.3 |  |  | 32.5 |
Lease liabilities |  | 32.1 |  |  | 35.3 |
Advertising and sales promotions and incentives |  | 19.8 |  |  | 16.5 |
Inventory |  | 6.8 |  |  | 14.4 |
Net operating losses and other carryforwards |  | 5.4 |  |  | 5.3 |
Other 1 |  | 6.9 |  |  | 3.3 |
Valuation allowance |  | (5.1) |  |  | (3.3) |
Deferred income tax assets |  | $ | 202.8 |  |  | $ | 177.0 |
Deferred income tax liabilities: |  |  |  |
Right-of-use assets |  | $ | (31.5) |  |  | $ | (34.8) |
Depreciation |  | (55.1) |  |  | (60.0) |
Amortization |  | (71.7) |  |  | (68.4) |
Deferred income tax liabilities |  | (158.3) |  |  | (163.2) |
Deferred income tax assets, net |  | $ | 44.5 |  |  | $ | 13.8 |
1 Presentation of fiscal 2023 deferred income taxes has been conformed to the current year presentation. There was no change to total deferred income tax assets, deferred income tax liabilities, or deferred income tax liabilities, net. As of October 31, 2024, the company has domestic net operating loss carryforwards of $2.2 million for federal income tax purposes, and $3.1 million state income tax purposes, that do not expire and $0.4 million for state income tax purposes that expire between fiscal 2038 and fiscal 2044. As of October 31, 2024, the company has net operating loss carryforwards of approximately $6.9 million in foreign jurisdictions, which are comprised of $6.7 million that do not expire and $0.2 million that expires between fiscal 2035 and fiscal 2041. The company also has domestic credit carryforwards of $2.3 million that expire between fiscal 2027 and fiscal 2043. The net change in the total valuation allowance between the fiscal years ended October 31, 2024 and 2023 was an increase of $1.8 million. The change in valuation allowance is related to capital loss carryforwards, domestic tax credits, and foreign net operating losses that are expected to expire prior to utilization. The company expects that $25.9 million of the total undistributed earnings of its foreign operations will be indefinitely reinvested. Should these earnings be distributed in the future in the form of dividends or otherwise, the company may be subject to foreign withholding taxes, state income taxes, and/or additional federal taxes for currency fluctuations. As of October 31, 2024, the unrecognized deferred tax liabilities for temporary differences related to the company’s investment in non-U.S. subsidiaries, and any withholding, state, or additional federal taxes that may be applied upon any future repatriation, are expected to be immaterial. Unrecognized Tax Benefits A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (dollars in millions):
Unrecognized tax benefits as of October 31, 2023 |  | $ | 3.7 |
Increase as a result of tax positions taken during the current period |  | 0.4 |
Reductions as a result of statute of limitations lapses |  | (0.6) |
Unrecognized tax benefits as of October 31, 2024 |  | $ | 3.5 |
The company recognizes interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes within the Consolidated Statements of Earnings. In addition to the unrecognized tax benefits of $3.5 million, which have been recorded as an other accrued liability within the Consolidated Balance Sheets as of October 31, 2024, the company recorded $1.1 million of accrued interest and penalties as an other accrued liability within the Consolidated Balance Sheets as of October 31, 2024. Included in the balance of unrecognized tax benefits as of October 31, 2024 are potential benefits of $3.7 million that, if recognized, would affect the effective tax rate. The company and its wholly owned subsidiaries file income tax returns in the U.S. federal jurisdiction, and numerous state and foreign jurisdictions. With few exceptions, the company is no longer subject to U.S. federal, state and local, and foreign income tax examinations by tax authorities for taxable years before fiscal 2020. The Internal Revenue Service has commenced an audit of fiscal 2022, with no material adjustments to tax expense or unrecognized tax benefits expected. The company is under audit in certain state jurisdictions and expects various statutes of limitation to expire during the next 12 months. Due to the uncertainty related to the response of taxing authorities, a range of outcomes cannot be reasonably estimated at this time. The Organization for Economic Co-operation and Development ("OECD") has issued the Pillar Two Model Rules Framework (the "Framework"), which establishes global minimum tax rules with a minimum tax rate of 15%. The OECD continues to release additional guidance on these rules. Although it is uncertain whether the United States will enact legislation to adopt the minimum tax directive, certain countries where the company operates have adopted legislation effective for fiscal years beginning on or after January 1, 2024, and other countries are in the process of introducing such legislation. The company does not expect the Framework to have a material impact on its Consolidated Financial Statements.

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 tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration