Facebook 2013 Annual Report Download - page 86

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84
The following table reflects changes in the gross unrecognized tax benefits (in millions):
Year Ended December 31,
2013 2012 2011
Gross unrecognized tax benefits-beginning of period $ 164 $ 63 $ 18
Increases related to prior year tax positions 425 13 5
Decreases related to prior year tax positions (13)(16) (2)
Increases related to current year tax positions 740 104 42
Gross unrecognized tax benefits-end of period $ 1,316 $ 164 $ 63
During all years presented, we recognized interest and penalties related to unrecognized tax benefits within the provision for
income taxes on the consolidated statements of income. For the year ended December 31, 2013, we recognized interest of $2 million and
a reversal for penalties of $2 million. The amount of interest and penalties accrued as of December 31, 2013, 2012, and 2011 was $10
million, $10 million, and $6 million, respectively.
If the remaining balance of gross unrecognized tax benefits of $1.32 billion as of December 31, 2013 was realized in a future
period, this would result in a tax benefit of $842 million within our provision of income taxes at such time.
We are subject to taxation in the United States and various other state and foreign jurisdictions. The material jurisdictions in which
we are subject to potential examination include the United States and Ireland. We are under examination by the Internal Revenue Service
(IRS) for our 2008 through 2010 tax years. We believe that adequate amounts have been reserved for any adjustments that may ultimately
result from these examinations and we do not anticipate a significant impact to our gross unrecognized tax benefits within the next 12
months related to these years. Our 2011 through 2013 tax years remain subject to examination by the IRS and all tax years starting in
2008 remain subject to examination in Ireland.
Although the timing of the resolution, settlement, and closure of any audits is highly uncertain, it is reasonably possible that the
balance of gross unrecognized tax benefits could significantly change in the next 12 months. However, given the number of years remaining
that are subject to examination, we are unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax
benefits.
Note 14. Geographical Information
Revenue by geography is based on the billing address of the advertiser or developer. The following table sets forth revenue and
property and equipment, net by geographic area (in millions):
Year Ended December 31,
2013 2012 2011
Revenue:
United States $ 3,613 $ 2,578 $ 2,067
Rest of the world(1) 4,259 2,511 1,644
Total revenue $ 7,872 $ 5,089 $ 3,711
(1) No individual country, other than disclosed above, exceeded 10% of our total revenue for any period presented
December 31,
2013 2012
Property and equipment, net:
United States $ 2,368 $ 2,110
Sweden 415 220
Rest of the world 99 61
Total property and equipment, net $ 2,882 $ 2,391