Cabela's 2010 Annual Report Download - page 102

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92
CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
A reconciliation of the statutory federal income tax rate to the effective income tax rate was as follows for the
years ended:
2010 2009 2008
Statutory federal rate 35.0%35.0%35.0%
State income taxes, net of federal tax benefit 2.7 2.1 1.7
Other nondeductible items 0.5 0.2 0.1
Tax exempt interest income (0.3)(0.7) -
Rate differential on foreign income (3.1)(2.2) -
Change in valuation allowance - - (0.8)
Other, net (2.1)0.8 (0.6)
32.7%35.2%35.4%
Deferred tax assets and liabilities consisted of the following for the years ended:
2010 2009
Deferred tax assets:
Deferred compensation $ 11,717 $9,325
Deferred revenue 4,508 4,396
Reserve for returns 5,022 5,886
Accrued expenses 13,003 15,444
Gift certificates liability 7,174 8,453
Allowance for loans losses and doubtful accounts 35,562 4,624
Economic development bonds 1,587 1,197
Loyalty rewards programs 35,740 -
Other 4,709 2,891
119,022 52,216
Deferred tax liabilities:
Prepaid expenses 11,848 14,736
Property and equipment 49,756 36,297
Inventories 3,106 6,791
Retained interests in securitized loans - 9,167
Asset-backed securities - 2,071
Credit card loan fee deferral 28,982 29,302
U.S. income tax on foreign earnings 9,877 -
Other 531 542
104,100 98,906
Net deferred tax (asset) liability (14,922)46,690
Less current deferred income taxes (2,136)25,866
Long-term deferred income taxes $ (12,786) $ 20,824
The Company has not provided United States income taxes and foreign withholding taxes on the portion of
undistributed earnings of foreign subsidiaries that the Company considers to be indefinitely reinvested outside
of the United States as of the end of year 2010. If these foreign earnings were to be repatriated in the future, the
related United States tax liability may be reduced by any foreign income taxes previously paid on these earnings.
As of the year ended 2010, the cumulative amount of earnings upon which United States income taxes have not
been provided is approximately $32,615. If those earnings were not considered indefinitely invested the Company
estimates that an additional income tax expense of $6,756 would be recorded.