Coca Cola 2005 Annual Report Download - page 55

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Our effective tax rate of approximately 27.2 percent for the year ended December 31, 2005, included the
following:
• an income tax benefit primarily related to the Philippines impairment charges at a rate of approximately
4 percent;
• an income tax benefit of approximately $101 million related to the reversal of previously accrued taxes
resulting from the favorable resolution of various tax matters; and
• a tax provision of approximately $315 million related to repatriation of previously unremitted foreign
earnings under the Jobs Creation Act.
Our effective tax rate of approximately 22.1 percent for the year ended December 31, 2004, included the
following:
• an income tax benefit of approximately $128 million related to the reversal of previously accrued taxes
resulting from the favorable resolution of various tax matters;
• an income tax benefit on ‘‘Other Operating Charges,’’ discussed above, at a rate of approximately
36 percent;
• an income tax provision of approximately $75 million related to the recording of a valuation allowance on
deferred tax assets of CCEAG; and
• an income tax benefit of approximately $50 million as a result of the realization of certain tax credits
related to the Jobs Creation Act.
Our effective tax rate of approximately 20.9 percent for the year ended December 31, 2003, included the
following:
• an income tax benefit of approximately $50 million related to the reversal of previously accrued taxes
resulting from the favorable resolution of various tax matters partially offset by additional taxes primarily
related to the repatriation of funds;
• the effective tax rate for the costs related to the streamlining initiatives of approximately 33 percent;
• the effective tax rate for the proceeds received related to the vitamin antitrust litigation matter of
approximately 34 percent (refer to Note 17 of Notes to Consolidated Financial Statements); and
• the effective tax rate for the charge related to a Latin American equity method investee of approximately
3 percent.
Based on current tax laws, the Company’s effective tax rate in 2006 is expected to be approximately
24 percent before considering the effect of any unusual or special items that may affect our tax rate in future
years.
Liquidity, Capital Resources and Financial Position
We believe our ability to generate cash from operating activities is one of our fundamental financial
strengths. We expect cash flows from operating activities to be strong in 2006 and in future years. For the
five-year period from 2006 through 2010, we currently estimate that cumulative net cash provided by operating
activities will be at least $30 billion. Accordingly, our Company expects to meet all of our financial commitments
and operating needs during this time frame. We expect to use cash generated from operating activities primarily
for dividends, share repurchases, acquisitions and aggregate contractual obligations.
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