Cabela's 2007 Annual Report Download - page 78

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72
CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
Deferred tax assets and liabilities consisted of the following for the years ended:
2007 2006
Deferred tax assets:
Deferred compensation ........................................... $ 5,547 $ 3,907
Deferred revenue ................................................ 3,744 3,276
Reserve for returns ............................................... 7,550 8,032
Accrued expenses................................................ 5,121 4,360
Gift certificates liability ........................................... 3,401 —
Allowance for doubtful accounts .................................... 2,505 1,822
Other.......................................................... 3,623 2,298
31,491 23,695
Deferred tax liabilities:
Prepaid expenses ................................................ 17,773 14,249
Property and equipment ........................................... 34,519 28,955
Inventories ..................................................... 14,902 16,999
Retained interests in securitized loans ................................ 10,050 9,055
Other ......................................................... 45 2,855
77,289 72,113
Valuation allowance................................................. (916) —
Net deferred tax liability ............................................. (46,714) (48,418)
Less current deferred income taxes..................................... 15,601 17,978
Long-term deferred income taxes ...................................... $(31,113) $ (30,440)
As of December 29, 2007, state net operating losses totaling $15,656 are being carried forward which begin to
expire in 2014. These losses will expire completely by 2021. A full valuation allowance has been established against
net operating loss carryforwards as it is uncertain if we will generate sufficient taxable income in these jurisdictions
to recognize the tax benefit of these losses.
We adopted the provisions of FIN 48 in 2007 as discussed in Note 2. The reconciliation of unrecognized tax
benefits, the balance of which is classified as other long-term liabilities in the consolidated balance sheet, is as
follows for the year ended 2007:
Unrecognized tax benefits, beginning of year ......................................... $ 8,569
Decreases on items related to prior periods ........................................... (6,866)
Increases from current period items ................................................ 297
Unrecognized tax benefits, end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000