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Income Taxes (Tables)

12 Months Ended

Sep. 30, 2012

Calculation of Income Tax (Benefit) Expense from Continuing Operations Before Income Tax

Income tax (benefit) expense was calculated based upon the following components of income (loss) from continuing operations before income tax:

		September 30,
		2012				2011				2010
Pretax income (loss):
United States		$	(146,542	)		$	(74,815	)		$	(238,179	)
Outside the United States			171,928				132,749				105,867
Total pretax income (loss)		$	25,386			$	57,934			$	(132,312	)

Schedule of Components of Income Tax (Benefit) Expense

The components of income tax (benefit) expense were as follows:

		September 30,
		2012				2011				2010
Current:
Federal		$	74,388			$	(875	)		$	—
Foreign			38,113				32,649				44,481
State			(370	)			2,336				2,913
Total current			112,131				34,110				47,394
Deferred:
Federal			(199,162	)			(20,622	)			22,119
Foreign			5,190				28,054				(6,514	)
State			(3,441	)			9,013				196
Total deferred			(197,413	)			16,445				15,801
Income tax (benefit) expense		$	(85,282	)		$	50,555			$	63,195

Schedule of Differences Between Income Taxes Expected and Reported Income Tax

The differences between income taxes expected at the U.S. Federal statutory income tax rate of 35% and reported income tax (benefit) expense are summarized as follows:

		September 30,
		2012				2011				2010
Expected income tax (benefit) expense at Federal statutory rate		$	8,885			$	20,277			$	(46,309	)
Valuation allowance for deferred tax assets			(142,126	)			72,335				92,673
Preferred stock equity conversion feature			54,810				(9,486	)			—
Residual tax on foreign earnings			29,844				18,943				6,609
Foreign rate differential			(14,115	)			(12,650	)			(9,601	)
Bargain purchase gain			—				(55,419	)			—
Gain on contingent purchase price reduction			(14,350	)			—				—
Permanent items			9,544				10,657				4,829
Exempt foreign income			(5,760	)			(380	)			(9	)
Unrecognized tax benefits			(4,386	)			(2,793	)			3,234
State and local income taxes			(8,539	)			1,235				(4,975	)
Dividends received deduction			(965	)			—				—
Inflationary adjustments			(803	)			(1,472	)			3,409
Capitalized transaction costs			343				2,800				—
Deferred tax correction of immaterial prior period error			—				4,873				5,900
Reorganization items			—				—				8,678
Other			2,336				1,635				(1,243	)
Reported income tax (benefit) expense		$	(85,282	)		$	50,555			$	63,195
Effective tax rate			(335.9	)%			87.3	%			(47.8	)%

Schedule of Components of Deferred Income Tax Assets and Liabilities

The following table summarizes the components of deferred income tax assets and liabilities:

		September 30,
		2012				2011
Current deferred tax assets:
Employee benefits		$	29,491			$	14,188
Restructuring			8,054				10,682
Inventories and receivables			22,495				21,521
Marketing and promotional accruals			8,270				8,911
Capitalized transaction costs			129				292
Unrealized losses on mark-to-market securities			10,213				9,574
Other			15,090				14,971
Valuation allowance			(48,968	)			(37,523	)
Total current deferred tax assets			44,774				42,616
Current deferred tax liabilities:
Inventories and receivables			(2,618	)			(5,015	)
Unrealized gains			(1,153	)			(2,382	)
Other			(7,936	)			(5,705	)
Total current deferred tax liabilities			(11,707	)			(13,102	)
Net current deferred tax assets, included in “Prepaid expenses and other current assets”		$	33,067			$	29,514
Noncurrent deferred tax assets:
Employee benefits		$	37,488			$	32,369
Restructuring and purchase accounting			371				2,269
Net operating loss, credit and capital loss carry forwards			914,480				1,026,610
Prepaid royalty			7,006				7,346
Properties			3,255				5,240
Capitalized transaction costs			—				4,648
Unrealized losses on mark-to-market securities			12,734				18,574
Long-term debt			3,976				22,602
Intangibles			4,282				4,749
Deferred acquisition costs			9,906				74,175
Insurance reserves and claim related adjustments			620,285				408,214
Other			30,850				28,556
Valuation allowance			(611,139	)			(764,710	)
Total noncurrent deferred tax assets			1,033,494				870,642
Noncurrent deferred tax liabilities:
Properties			(15,337	)			(16,593	)
Unrealized gains			(15,803	)			(11,619	)
Intangibles			(596,199	)			(571,454	)
Value of business acquired			(36,512	)			(148,876	)
Tax on unremitted foreign earnings			(29,231	)			—
Investments			(438,655	)			(246,632	)
Other			(4,511	)			(6,418	)
Total noncurrent deferred tax liabilities			(1,136,248	)			(1,001,592	)
Net noncurrent deferred tax liabilities, included in “Deferred tax assets” (Insurance and Financial Services) and “Deferred tax liabilities” (Consumer Products and Other)		$	(102,754	)		$	(130,950	)
Net current and noncurrent deferred tax liabilities		$	(69,687	)		$	(101,436	)

Summary of Changes to Unrecognized Tax Benefits Reserves Excluding Related Interest and Penalties

The following table summarizes changes to the Company’s UTB reserves, excluding related interest and penalties:

Unrecognized tax benefits at September 30, 2009		$	7,765
Russell Hobbs acquired unrecognized tax benefits			3,251
HGI unrecognized tax benefits as of June 16, 2010			732
Gross decrease — tax positions in prior period			(904	)
Gross increase — tax positions in current period			3,390
Lapse of statutes of limitations			(1,060	)
Unrecognized tax benefits at September 30, 2010		$	13,174
Gross increase — tax positions in prior period			1,658
Gross decrease — tax positions in prior period			(823	)
Gross increase — tax positions in current period			596
Settlements			(1,850	)
Lapse of statutes of limitations			(3,742	)
Unrecognized tax benefits at September 30, 2011		$	9,013
Gross increase — tax positions in prior period			773
Gross decrease — tax positions in prior period			(1,308	)
Gross increase — tax positions in current period			776
Settlements			(1,737	)
Lapse of statutes of limitations			(1,640	)
Unrecognized tax benefits at September 30, 2012		$	5,877

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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