XML 51 R29.htm IDEA: XBRL DOCUMENT
v3.6.0.2

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Taxes |
Note 20. | Income Taxes
The company’s provision for income tax expense consists of the following for fiscal years 2016, 2015 and 2014 (amounts in thousands):
|  | Fiscal 2016 |  |  | Fiscal 2015 |  |  | Fiscal 2014 |
Current Taxes: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 86,235 |  |  | $ | 75,128 |  |  | $ | 72,780 |
State |  |  | 13,983 |  |  |  | 10,419 |  |  |  | 10,294 |
|  |  | 100,218 |  |  |  | 85,547 |  |  |  | 83,074 |
Deferred Taxes: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (11,656 | ) |  |  | 16,236 |  |  |  | 7,691 |
State |  |  | (2,801 | ) |  |  | 2,057 |  |  |  | 1,550 |
|  |  | (14,457 | ) |  |  | 18,293 |  |  |  | 9,241 |
Income tax expense |  | $ | 85,761 |  |  | $ | 103,840 |  |  | $ | 92,315 |
Income tax expense differs from the amount computed by applying the U.S. federal income tax rate (35%) because of the effect of the following items for fiscal years 2016, 2015, and 2014 (amounts in thousands):
|  | Fiscal 2016 |  |  | Fiscal 2015 |  |  | Fiscal 2014 |
Tax at U.S. federal income tax rate |  | $ | 87,338 |  |  | $ | 102,560 |  |  | $ | 93,819 |
State income taxes, net of federal income tax benefit |  |  | 7,266 |  |  |  | 8,556 |  |  |  | 7,698 |
Section 199 qualifying production activities benefit |  |  | (8,007 | ) |  |  | (6,725 | ) |  |  | (6,892 | )
Other |  |  | (836 | ) |  |  | (551 | ) |  |  | (2,310 | )
Income tax expense |  | $ | 85,761 |  |  | $ | 103,840 |  |  | $ | 92,315 |
In 2016 and 2015, the most significant differences in the effective rate and the statutory rate are state income taxes offset by reductions for the Section 199 qualifying production activities deduction. The company early adopted guidance discussed in Note 3, Recent Accounting Pronouncements, and retrospectively adjusted our current deferred income tax asset balance of $37.2 million at January 2, 2016 to the long-term deferred income tax liability balance. Deferred tax assets (liabilities) are comprised of the following (amounts in thousands):
|  | December 31, 2016 |  |  | January 2, 2016 |
Self-insurance |  | $ | 7,051 |  |  | $ | 6,073 |
Compensation and employee benefits |  |  | 13,512 |  |  |  | 13,632 |
Deferred income |  |  | 10,893 |  |  |  | 10,102 |
Loss and credit carryforwards |  |  | 19,556 |  |  |  | 21,839 |
Equity-based compensation |  |  | 11,890 |  |  |  | 13,676 |
Hedging |  |  | 676 |  |  |  | 6,391 |
Pension and postretirement benefits |  |  | 27,537 |  |  |  | 30,408 |
Intangible assets |  |  | 4,548 |  |  |  | 4,718 |
Other |  |  | 16,801 |  |  |  | 10,409 |
Deferred tax assets valuation allowance |  |  | (18 | ) |  |  | (18 | )
Deferred tax assets |  |  | 112,446 |  |  |  | 117,230 |
Depreciation |  |  | (75,569 | ) |  |  | (79,667 | )
Intangible assets |  |  | (179,491 | ) |  |  | (180,216 | )
Other |  |  | (3,240 | ) |  |  | (3,809 | )
Deferred tax liabilities |  |  | (258,300 | ) |  |  | (263,692 | )
Net deferred tax liability |  | $ | (145,854 | ) |  | $ | (146,462 | )
The company has a deferred tax asset of $7.2 million related to a federal net operating loss carryforward, and $4.1 million related to a federal capital loss carryforward, which we expect to fully utilize before expiration. Additionally, the company and various subsidiaries have a net deferred tax asset of $5.7 million related to state net operating loss carryforwards, and $2.6 million for credit carryforwards with expiration dates through fiscal 2035. The utilization of a portion of these state carryforwards could be limited in the future; therefore, an immaterial valuation allowance has been recorded. Should the company determine at a later date that certain of these losses which have been reserved for may be utilized, a benefit may be recognized in the Consolidated Statements of Income. Likewise, should the company determine at a later date that certain of these net operating losses for which a deferred tax asset has been recorded may not be utilized, a charge to the Consolidated Statements of Income may be necessary. The gross amount of unrecognized tax benefits was $1.8 million and $0.7 million as of December 31, 2016 and January 2, 2016, respectively. This change is primarily due to the addition of state reserves for uncertain positions taken in prior years, which is partially offset by the expiration of the statute of limitations on several previously unrecognized tax benefits. These amounts are exclusive of interest accrued and are recorded in other long-term liabilities on the Consolidated Balance Sheet. If recognized, the $1.8 million (less $0.6 million related to tax imposed in other jurisdictions) would impact the effective rate. The company accrues interest expense and penalties related to income tax liabilities as a component of income before taxes. No accrual of penalties is reflected on the company’s balance sheet as the company believes the accrual of penalties is not necessary based upon the merits of its income tax positions. The company had an accrued interest balance of approximately $0.2 million and $0.1 million at December 31, 2016 and January 2, 2016, respectively. The company defines the federal jurisdiction as well as various state jurisdictions as “major” jurisdictions. The company is no longer subject to federal examinations for years prior to 2015, and with limited exceptions, for years prior to 2012 in state jurisdictions. During the current year, the company closed a federal income tax audit with the Internal Revenue Service (“IRS”) for the fiscal 2012 through 2014 tax years. The impact of the audit did not have a material effect on our consolidated financial statements. The following is a reconciliation of the total amounts of unrecognized tax benefits for fiscal years 2016, 2015 and 2014 (amounts in thousands):
|  | Fiscal 2016 |  |  | Fiscal 2015 |  |  | Fiscal 2014 |
Unrecognized tax benefit at beginning of fiscal year |  | $ | 727 |  |  | $ | 2,107 |  |  | $ | 4,809 |
Gross increases |  |  | 1,488 |  |  |  | — |  |  |  | — |
Lapses of statutes of limitations |  |  | (461 | ) |  |  | (1,380 | ) |  |  | (2,702 | )
Unrecognized tax benefit at end of fiscal year |  | $ | 1,754 |  |  | $ | 727 |  |  | $ | 2,107 |
At this time, we do not anticipate material changes to the amount of gross unrecognized tax benefits over the next twelve months.

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=65882285&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=65882285&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=65882285&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=65882285&loc=d3e32537-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration