GE 2011 Annual Report Download - page 111

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GE 2011 ANNUAL REPORT 109
    
A reconciliation of the U.S. federal statutory income tax rate to the actual income tax rate is provided below.
RECONCILIATION OF U.S. FEDERAL STATUTORY INCOME TAX RATE TO ACTUAL INCOME TAX RATE
Consolidated GE GECS
2011 2010 2009 2011 2010 2009 2011 2010 2009
U.S. federal statutory income tax rate 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0%
Increase (reduction) in rate resulting
from inclusion of after-tax earnings
of GECS in before-tax earnings of GE ———(11.8) (7.0) (3.0) ———
Tax on global activities including exports (a) (10.4) (19.7) (39.7) (5.2) (10.8) (11.0) (14.7) (56.1) 89.4
NBCU gain 9.4 ——9.9 —————
U.S. business credits (b) (3.2) (4.4) (4.6) (1.5) (2.2) (1.0) (4.8) (14.2) 11.8
All other—net (2.3) (3.6) (2.3) (1.0) (1.6) (0.1) (3.5) (13.1) 8.1
(6.5) (27.7) (46.6) (9.6) (21.6) (15.1) (23.0) (83.4) 109.3
Actual income tax rate 28.5% 7.3% (11.6)% 25.4% 13.4% 19.9% 12.0% (48.4)% 144.3%
(a) 2009 included (7.1)% and 26.0% from indefinite reinvestment of prior-year earnings for consolidated and GECS, respectively.
(b) U.S. general business credits, primarily the credit for manufacture of energy efficient appliances, the credit for energy produced from renewable sources, the non-
conventional fuel tax credit, the low-income housing credit and the credit for research performed in the U.S.
DEFERRED INCOME TAXES
Aggregate deferred income tax amounts are summarized below.
December 31 (In millions) 2011 2010
ASSETS
GE $(19,769) $(14,843)
GECS (10,919) (12,867)
(30,688) (27,710)
LIABILITIES
GE 12,586 10,606
GECS 17,971 19,857
30,557 30,463
Net deferred income tax liability (asset) $ (131) $ 2,753
Principal components of our net liability (asset) representing
deferred income tax balances are as follows:
December 31 (In millions) 2011 2010
GE
Investment in NBCU LLC $ 4,880 $ —
Contract costs and estimated earnings 2,834 2,671
Intangible assets 1,701 2,772
Investment in global subsidiaries 780 1,934
Depreciation 574 951
Provision for expenses (a) (6,745) (5,991)
Principal pension plans (6,431) (2,519)
Retiree insurance plans (4,218) (3,814)
Non-U.S. loss carryforwards (b) (1,039) (1,115)
Other—net 481 874
(7,183) (4,237)
GECS
Financing leases 6,718 6,168
Operating leases 5,030 4,812
Intangible assets 1,689 1,567
Investment in global subsidiaries 85 1,321
Allowance for losses (2,949) (2,807)
Non-U.S. loss carryforwards (b) (2,861) (2,320)
Cash flow hedges (104) (612)
Net unrealized losses on securities (64) (276)
Other—net (492) (863)
7,052 6,990
Net deferred income tax liability (asset) $ (131) $ 2,753
(a) Represented the tax effects of temporary differences related to expense
accruals for a wide variety of items, such as employee compensation and
benefits, other pension plan liabilities, interest on tax liabilities, product
warranties and other sundry items that are not currently deductible.
(b) Net of valuation allowances of $1,183 million and $902 million for GE and
$613 million and $419 million for GECS, for 2011 and 2010, respectively. Of the
net deferred tax asset as of December 31, 2011, of $3,900 million, $45 million
relates to net operating loss carryforwards that expire in various years ending
from December 31, 2012, through December 31, 2014; $173 million relates to net
operating losses that expire in various years ending from December 31, 2015,
through December 31, 2026 and $3,682 million relates to net operating loss
carryforwards that may be carried forward indefinitely.