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Income Taxes | 12 Months Ended
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Dec. 31, 2012
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Following is a summary of earnings from continuing operations before income taxes for United States and foreign operations:
| 2012 |  | 2011 |  | 2010
United States | $ | 164,122 |  |  | 78,224 |  |  | 39,332 |
Foreign | 140,370 |  |  | 121,650 |  |  | 153,316 |
Earnings before income taxes | $ | 304,492 |  |  | 199,874 |  |  | 192,648 |
Income tax expense (benefit) for the years ended December 31, 2012, 2011 and 2010 consists of the following:
| 2012 |  | 2011 |  | 2010
Current income taxes: |  |  |  |  |
U.S. federal | $ | 26,204 |  |  | 13,957 |  |  | 14,052 |
State and local | 4,583 |  |  | 5,118 |  |  | 1,514 |
Foreign | 13,775 |  |  | 7,190 |  |  | 8,426 |
Total current | 44,562 |  |  | 26,265 |  |  | 23,992 |
Deferred income taxes: |  |  |  |  |
U.S. federal | 31,106 |  |  | 8,994 |  |  | (8,578 | )
State and local | 4,704 |  |  | (3,488 | ) |  | 18,562 |
Foreign | (26,773 | ) |  | (10,122 | ) |  | (31,263 | )
Total deferred | 9,037 |  |  | (4,616 | ) |  | (21,279 | )
Total | $ | 53,599 |  |  | 21,649 |  |  | 2,713 |
Income tax expense (benefit) attributable to earnings before income taxes differs from the amounts computed by applying the U.S. statutory federal income tax rate to earnings before income taxes as follows:
| 2012 |  | 2011 |  | 2010
Income taxes at statutory rate | $ | 106,572 |  |  | 69,956 |  |  | 67,427 |
State and local income taxes, net of federal income tax benefit | 6,004 |  |  | 2,821 |  |  | 2,358 |
Foreign income taxes | (66,538 | ) |  | (45,112 | ) |  | (21,389 | )
Change in valuation allowance | 5,703 |  |  | (2,052 | ) |  | (17,139 | )
Tax contingencies and audit settlements | (3,598 | ) |  | (5,911 | ) |  | (3,447 | )
Acquisition related tax contingencies | — |  |  | — |  |  | (30,162 | )
Change in statutory tax rate | — |  |  | — |  |  | (49 | )
Other, net | 5,456 |  |  | 1,947 |  |  | 5,114 |
| $ | 53,599 |  |  | 21,649 |  |  | 2,713 |
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities as of December 31, 2012 and 2011 are presented below:
| 2012 |  | 2011
Deferred tax assets: |  |  |
Accounts receivable | $ | 12,289 |  |  | 10,031 |
Inventories | 38,801 |  |  | 39,227 |
Accrued expenses and other | 97,808 |  |  | 90,171 |
Deductible state tax and interest benefit | 13,119 |  |  | 17,224 |
Intangibles | 113,282 |  |  | 136,891 |
Federal, foreign and state net operating losses and credits | 247,786 |  |  | 273,509 |
Gross deferred tax assets | 523,085 |  |  | 567,053 |
Valuation allowance | (321,585 | ) |  | (334,215 | )
Net deferred tax assets | 201,500 |  |  | 232,838 |
Deferred tax liabilities: |  |  |
Inventories | (8,106 | ) |  | (5,270 | )
Plant and equipment | (277,324 | ) |  | (294,960 | )
Intangibles | (128,433 | ) |  | (137,888 | )
Other liabilities | (7,854 | ) |  | (6,401 | )
Gross deferred tax liabilities | (421,717 | ) |  | (444,519 | )
Net deferred tax liability (1) | $ | (220,217 | ) |  | (211,681 | )
(1) | This amount includes $4,317 and $1,822 of non-current deferred tax assets which are in deferred income taxes and other non-current assets and $6,309 and $8,760 current deferred tax liabilities which are included in accounts payable and accrued expenses in the consolidated balance sheets as of December 31, 2012 and 2011, respectively.
The Company evaluates its ability to realize the tax benefits associated with deferred tax assets by analyzing its forecasted taxable income using both historic and projected future operating results, the reversal of existing temporary differences, taxable income in prior carry-back years (if permitted) and the availability of tax planning strategies. The valuation allowance as of December 31, 2012, 2011 and 2010 is $321,585, $334,215 and $325,127, respectively. The valuation allowance as of December 31, 2012 relates to the net deferred tax assets of one of the Company’s foreign subsidiaries as well as certain state net operating losses and tax credits. The total change in the 2012 valuation allowance was a decrease of $12,630 which includes $5,863 related to foreign currency translation. The total change in the 2011 valuation allowance was an increase of $9,088, which includes $7,040 related to foreign currency translation. The total change in the 2010 valuation allowance was a decrease of $40,817, which includes $22,046 related to foreign currency translation. Management believes it is more likely than not that the Company will realize the benefits of its deferred tax assets, net of valuation allowances, based upon the expected reversal of deferred tax liabilities and the level of historic and forecasted taxable income over periods in which the deferred tax assets are deductible. As of December 31, 2012, the Company has state net operating loss carry forwards and state tax credits with potential tax benefits of $49,081, net of federal income tax benefit; these carry forwards expire over various periods based on taxing jurisdiction. A valuation allowance totaling $39,461 has been recorded against these state deferred tax assets as of December 31, 2012. In addition, as of December 31, 2012, the Company has net operating loss carry forwards in various foreign jurisdictions with potential tax benefits of $198,705. A valuation allowance totaling $170,394 has been recorded against these deferred tax assets as of December 31, 2012. The Company does not provide for U.S. federal and state income taxes on the cumulative undistributed earnings of its foreign subsidiaries because such earnings are deemed to be permanently reinvested. As of December 31, 2012, the Company had not provided federal income taxes on earnings of approximately $786,000 from its foreign subsidiaries. Should these earnings be distributed in the form of dividends or otherwise, the Company would be subject to both U.S. income taxes and withholding taxes in various foreign jurisdictions. These taxes may be partially offset by U.S. foreign tax credits. Determination of the amount of the unrecognized deferred U.S. tax liability is not practical because of the complexities associated with this hypothetical calculation. Tax Uncertainties In the normal course of business, the Company’s tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax and interest assessments by these taxing jurisdictions. Accordingly, the Company accrues liabilities when it believes that it is not more likely than not that it will realize the benefits of tax positions that it has taken in its tax returns or for the amount of any tax benefit that exceeds the cumulative probability threshold in accordance with ASC 740-10. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest related to unrecognized tax benefits in interest and penalties in income tax expense (benefit). Differences between the estimated and actual amounts determined upon ultimate resolution, individually or in the aggregate, are not expected to have a material adverse effect on the Company’s consolidated financial position but could possibly be material to the Company’s consolidated results of operations or cash flow in any given quarter or annual period. In January 2012, the Company received a €23,789 assessment from the Belgian tax authority related to its year ended December 31, 2008, asserting that the Company had understated its Belgian taxable income for that year. The Company filed a formal protest in the first quarter of 2012 refuting the Belgian tax authority's position and in order to eliminate the accrual of additional interest on the assessed amount, the Company remitted payment of the tax assessment, plus applicable interest of €2,912 (collectively, the “Deposit”). In July 2012, the Company received notification of the Belgian tax authority's intention to extend the statute of limitations back to and including the tax year 2005. On September 10, 2012, the Company received notice from the Belgian tax authority setting aside the 2008 assessment and refunding the Deposit to the Company. On October 23, 2012, the Company received notification from the Belgian tax authority of its intent to increase the Company's tax base for the 2008 tax year under a revised theory. On December 28, 2012, the Company received the refund of the Deposit of €23,789. On January 30, 2013, the Company received a refund of the interest Deposit of €2,912 and interest income of €1,583 earned on the Deposit. On December 28, 2012, the Belgian taxing authority issued assessments under a revised theory related to the years ended December 31, 2005 and December 31, 2009, in the amounts of €46,135 and €35,567, respectively, excluding potential interest and penalties. The Company intends to file a formal protest during the first quarter of 2013 relating to the new assessments. The Company disagrees with the views of the Belgian tax authority on this matter and will continue to vigorously defend itself. Although there can be no assurances, the Company believes the ultimate outcome of these actions will not have a material adverse effect on its financial condition but could have a material adverse effect on its results of operations, liquidity or cash flows in a given quarter or year. As of December 31, 2012, the Company’s gross amount of unrecognized tax benefits is $53,835, excluding interest and penalties. If the Company were to prevail on all uncertain tax positions, $36,902 of the unrecognized tax benefits would affect the Company’s effective tax rate, exclusive of any benefits related to interest and penalties. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| 2012 |  | 2011
Balance as of January 1 | $ | 46,087 |  |  | 49,943 |
Additions based on tax positions related to the current year | 3,142 |  |  | 306 |
Additions for tax positions of prior years | 17,006 |  |  | 7,907 |
Reductions for tax positions of prior years | (3,571 | ) |  | (926 | )
Reductions resulting from the lapse of the statute of limitations | (1,764 | ) |  | (1,391 | )
Settlements with taxing authorities | (7,065 | ) |  | (9,752 | )
Balance as of December 31 | $ | 53,835 |  |  | 46,087 |
The Company will continue to recognize interest and penalties related to unrecognized tax benefits as a component of its income tax provision. As of December 31, 2012 and 2011, the Company has $5,874 and $7,998, respectively, accrued for the payment of interest and penalties, excluding the federal tax benefit of interest deductions where applicable. During the years ending December 31, 2012 , 2011 and 2010, the Company reversed interest and penalties through the consolidated statements of operations of $1,585, $3,755 and $9,852, respectively. The Company believes that its unrecognized tax benefits could decrease by $7,499 within the next twelve months. The Company has effectively settled all Federal income tax matters related to years prior to 2009. Various other state and foreign income tax returns are open to examination for various years. The Internal Revenue Service ("IRS") recently concluded its examination of the Company's 2007-2009 federal income tax returns. The results of the federal income tax examination were submitted to the Congressional Joint Committee on Taxation for review. Subsequent to the quarter ended December 31, 2012, the Company received notice that the Congressional Joint Committee on Taxation had completed its review and took no exception to the conclusions reached by the IRS.

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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 Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. 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=6881521&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 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 5: 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 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: 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 7: 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 8: 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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