XML 75 R13.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2013
Income Taxes [Abstract] |
Income Taxes | Note 5 – Income Taxes Income (loss) from continuing operations before taxes and noncontrolling interests consists of the following components:
|  | Years ended December 31, |
|  | 2013 |  |  | 2012 |  |  | 2011 |
Domestic |  | $ | (26,065 | ) |  | $ | (15,995 | ) |  | $ | 2,143 |
Foreign |  |  | 202,470 |  |  |  | 186,032 |  |  |  | 328,973 |
|  | $ | 176,405 |  |  | $ | 170,037 |  |  | $ | 331,116 |
Significant components of income taxes are as follows:
|  | Years ended December 31, |
|  | 2013 |  |  | 2012 |  |  | 2011 |
Current: |  |  |  |  |  |  |  |  |
Federal |  | $ | (603 | ) |  | $ | 8,409 |  |  | $ | 10,968 |
State and local |  |  | 280 |  |  |  | 574 |  |  |  | (801 | )
Foreign |  |  | 51,225 |  |  |  | 44,351 |  |  |  | 66,844 |
|  |  | 50,902 |  |  |  | 53,334 |  |  |  | 77,011 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 2,215 |  |  |  | (8,557 | ) |  |  | 6,188 |
State and local |  |  | 92 |  |  |  | (240 | ) |  |  | (2,286 | )
Foreign |  |  | (573 | ) |  |  | 1,969 |  |  |  | 10,206 |
|  |  | 1,734 |  |  |  | (6,828 | ) |  |  | 14,108 |
Total income tax expense |  | $ | 52,636 |  |  | $ | 46,506 |  |  | $ | 91,119 |
Note 5 – Income Taxes (continued) Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts for income tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows:
|  | December 31, |
|  | 2013 |  |  | 2012 |
Deferred tax assets: |  |  |  |  |  |
Pension and other retiree obligations |  | $ | 34,343 |  |  | $ | 58,577 |
Inventories |  |  | 8,759 |  |  |  | 13,881 |
Net operating loss carryforwards |  |  | 182,691 |  |  |  | 158,638 |
Tax credit carryforwards |  |  | 20,780 |  |  |  | 16,180 |
Other accruals and reserves |  |  | 31,469 |  |  |  | 34,194 |
Total gross deferred tax assets |  |  | 278,042 |  |  |  | 281,470 |
Less valuation allowance |  |  | (183,289 | ) |  |  | (166,266 | )
|  |  | 94,753 |  |  |  | 115,204 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Tax over book depreciation |  |  | (10,652 | ) |  |  | (13,975 | )
Earnings not permanently reinvested |  |  | - |  |  |  | (1,652 | )
Convertible debentures |  |  | (162,371 | ) |  |  | (149,113 | )
Other - net |  |  | (5,932 | ) |  |  | (2,711 | )
Total gross deferred tax liabilities |  |  | (178,955 | ) |  |  | (167,451 | )
Net deferred tax assets (liabilities) |  | $ | (84,202 | ) |  | $ | (52,247 | )
The Company makes significant judgments regarding the realizability of its deferred tax assets (principally net operating losses). The carrying value of deferred tax assets is based on the Company's assessment that it is more likely than not that the Company will realize these assets after consideration of all available positive and negative evidence. A reconciliation of income tax expense at the U.S. federal statutory income tax rate to actual income tax provision is as follows:
|  | Years ended December 31, |
|  | 2013 |  |  | 2012 |  |  | 2011 |
Tax at statutory rate |  | $ | 61,742 |  |  | $ | 59,513 |  |  | $ | 115,891 |
State income taxes, net of U.S. federal tax benefit |  |  | 242 |  |  |  | 217 |  |  |  | (2,005 | )
Effect of foreign operations |  |  | (18,696 | ) |  |  | (19,083 | ) |  |  | (52,609 | )
Unrecognized tax benefits |  |  | 2,862 |  |  |  | 6,626 |  |  |  | 4,869 |
Change in valuation allowance on non-U.S. deferred tax assets |  |  | (285 | ) |  |  | (4,036 | ) |  |  | (5,554 | )
Tax benefit of operating loss carryforwards |  |  | (1,259 | ) |  |  | (671 | ) |  |  | (1,588 | )
Foreign income taxable in the U.S. |  |  | 11,961 |  |  |  | 7,476 |  |  |  | 22,822 |
Tax on foreign dividends paid to the U.S. |  |  | - |  |  |  | - |  |  |  | 15,453 |
U.S. foreign tax credits |  |  | - |  |  |  | (4,257 | ) |  |  | (12,322 | )
Effect of statutory rate changes on deferred tax assets |  |  | (2,867 | ) |  |  | - |  |  |  | 9,040 |
Other |  |  | (1,064 | ) |  |  | 721 |  |  |  | (2,878 | )
Total income tax expense |  | $ | 52,636 |  |  | $ | 46,506 |  |  | $ | 91,119 |
Note 5 – Income Taxes (continued) Income tax expense for the years ended December 31, 2013, 2012, and 2011 include certain discrete tax items for changes in uncertain tax positions, valuation allowances, tax rates, and other related items. These items total $(4,197) (tax benefit), $(4,036) (tax benefit), and $3,486 in 2013, 2012, and 2011, respectively. For the year ended December 31, 2013, the discrete items include a $2,867 benefit recorded in the third fiscal quarter due to a new tax law enacted in Israel in July 2013 which effectively increases the corporate income tax rate on certain types of income earned after January 1, 2014, and, therefore, increases the deferred tax assets, and a $1,330 benefit recorded in the first fiscal quarter due to the retroactive enactment of the American Taxpayer Relief Act of 2012, signed into law on January 2, 2013. For the year ended December 31, 2012, the discrete item is the reduction of a valuation allowance on a deferred tax asset in Israel due to a merger of several of the Company's wholly-owned subsidiaries in Israel in the fourth fiscal quarter which will allow for the realization of these tax benefits that likely otherwise would have been forgone. For the year ended December 31, 2011, the discrete items included a $10,024 expense for the effect of a tax rate change on deferred taxes in Israel recorded in the first fiscal quarter, reduced by $984 for a 2010 tax return filing in the fourth fiscal quarter, and partially offset by benefits related to reductions of valuation allowances in various jurisdictions of $5,554 recorded in the fourth fiscal quarter. The reductions of valuation allowances were principally in Belgium due to expected future income from a pending real estate sale. At December 31, 2013, the Company had the following significant net operating loss carryforwards for tax purposes:
|  |  |  |  | Expires |
Austria |  | $ | 13,699 |  |  | No expiration |
Belgium |  |  | 196,898 |  |  | No expiration |
Brazil |  |  | 16,736 |  |  | No expiration |
Germany |  |  | 49,880 |  |  | No expiration |
Israel |  |  | 79,406 |  |  | No expiration |
Netherlands |  |  | 24,136 |  |  | 2014 - 2022 |
United States |  |  | 41,575 |  |  | 2033 |
California |  |  | 54,317 |  |  | 2016 - 2033 |
Pennsylvania |  |  | 637,923 |  |  | 2018 - 2033 |
Approximately $72,926 of the carryforwards in Belgium resulted from the Company's acquisition of BCcomponents in 2002. Valuation allowances of $24,788 and $23,946, as of December 31, 2013 and 2012, respectively, have been recorded through goodwill for these acquired net operating losses. Prior to the adoption of updated guidance in ASC Topic 805 on January 1, 2009, if tax benefits were recognized through the utilization of these acquired net operating losses, the benefits of such loss utilization were recorded as a reduction to goodwill. After the adoption of the updated guidance on January 1, 2009, the benefits of such losses are recorded as a reduction of tax expense. In 2013, 2012, and 2011, the tax benefit recognized through a reduction of acquisition-date valuation allowances recorded as a reduction of tax expense was $0, $0, and $4,299, respectively. The reduction in valuation allowances included pre-acquisition allowances for losses in Austria and Netherlands. At December 31, 2013, the Company had the following significant tax credit carryforwards available:
|  |  |  |  | Expires |
U.S. Foreign Tax Credit |  | $ | 11,026 |  |  |  | 2020 - 2022 |
California Research Credit |  |  | 9,062 |  |  | No expiration |
Note 5 – Income Taxes (continued) At December 31, 2013, no provision has been made for U.S. federal and state income taxes on approximately $2,752,155 of foreign earnings, which the Company continues to expect to be reinvested outside of the United States indefinitely. Upon distribution of those earnings in the form of dividends or otherwise, the Company would be subject to U.S. income taxes (subject to an adjustment for foreign tax credits), state income taxes, incremental foreign income taxes, and withholding taxes payable to the various foreign countries. Determination of the amount of unrecognized deferred U.S. income tax liability is not practicable because of the complexities associated with its hypothetical calculation. As of December 31, 2008, the Company recorded additional tax expense for an expected repatriation of $112,500 because such earnings were not deemed to be indefinitely reinvested outside of the United States. During the third fiscal quarter of 2012, the Company repatriated $72,100 of cash to the U.S., which substantially completed the $112,500 cash repatriation program the Company initiated in 2008. This repatriated cash was used to reduce the amount outstanding under the Company's revolving credit facility. At the present time, the Company expects that the remaining cash and profits generated by foreign subsidiaries will continue to be reinvested indefinitely. Net income taxes paid were $44,757, $46,611, and $126,918 for the years ended December 31, 2013, 2012, and 2011, respectively. See Note 19 for a discussion of the tax-related uncertainties for the pre-spin-off period of Vishay Precision Group, Inc. ("VPG"), which was spun off on July 6, 2010. Note 5 – Income Taxes (continued) The following table summarizes changes in the liabilities associated with unrecognized tax benefits:
|  | Years ended December 31, |
|  | 2013 |  |  | 2012 |  |  | 2011 |
Balance at beginning of year |  | $ | 51,771 |  |  | $ | 48,152 |  |  | $ | 52,066 |
Addition based on tax positions related to the current year |  |  | - |  |  |  | 665 |  |  |  | 2,459 |
Addition based on tax positions related to prior years |  |  | 4,015 |  |  |  | 3,498 |  |  |  | 7,232 |
Currency translation adjustments |  |  | 310 |  |  |  | (215 | ) |  |  | (749 | )
Reduction based on tax positions related to prior years |  |  | (2,054 | ) |  |  | - |  |  |  | (3,293 | )
Reduction for settlements |  |  | (7,316 | ) |  |  | (329 | ) |  |  | (9,528 | )
Reduction for lapses of statute of limitation |  |  | (849 | ) |  |  | - |  |  |  | (35 | )
Balance at end of year |  | $ | 45,877 |  |  | $ | 51,771 |  |  | $ | 48,152 |
All of the unrecognized tax benefits of $45,877 and $51,771, as of December 31, 2013 and 2012, respectively, would reduce the effective tax rate if recognized. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. At December 31, 2013 and 2012, the Company had accrued interest and penalties related to the unrecognized tax benefits of $7,766 and $8,513, respectively. During the years ended December 31, 2013, 2012, and 2011, the Company recognized $2,218, $2,833, and $3,795, respectively, in interest and penalties. The Company and its subsidiaries file U.S. federal income tax returns, as well as tax returns in multiple state and foreign jurisdictions. The U.S. Internal Revenue Service is currently conducting an examination of Vishay's U.S. federal tax returns for the years 2010 and 2011. Because of net operating losses which were fully utilized on the 2010 tax return, the Company's U.S. federal tax returns for 2003 through 2009 remain subject to examination. Most principal subsidiaries in Israel are currently under examination for tax years 2008 through 2010. The tax returns of other significant non-U.S. subsidiaries which are currently under examination include India (2004 through 2011), China (2009), and the Republic of Taiwan (2007 through 2012). In 2013, the Company settled an examination of the 2005 through 2008 tax years for its subsidiaries in Germany. The Company and its subsidiaries also file income tax returns in other taxing jurisdictions in the U.S. and around the world, many of which are still open to examinations. The timing of the resolution of income tax examinations is highly uncertain, as are the amounts and timing of tax payments that result from such examinations. These events could cause large fluctuations in the balance sheet classification of current and non-current unrecognized tax benefits. The Company believes that in the next 12 months it is reasonably possible that certain income tax examinations will conclude or the statutes of limitation on certain income tax periods open to examination will expire, or both. Given the uncertainties described above, the Company can only determine an estimate of potential decreases in unrecognized tax benefits ranging from $30,900 to $35,000.

X
- 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 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
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration