HP 2010 Annual Report Download - page 130

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 14: Taxes on Earnings (Continued)
The significant components of deferred tax assets and deferred tax liabilities were as follows for
the following fiscal years ended October 31:
2010 2009
Deferred Deferred Deferred Deferred
Tax Ta x Ta x Tax
Assets Liabilities Assets Liabilities
In millions
Loss carryforwards ................................ $ 9,832 $ — $ 9,191 $ —
Credit carryforwards .............................. 733 — 1,444 —
Unremitted earnings of foreign subsidiaries .............. — 7,529 — 7,555
Inventory valuation ............................... 153 10 111 6
Intercompany transactions—profit in inventory ........... 514 1 534 16
Intercompany transactions—excluding inventory .......... 2,339 — 1,328 —
Fixed assets ..................................... 163 15 119 9
Warranty ....................................... 723 48 794 38
Employee and retiree benefits ....................... 2,800 29 2,692 80
Accounts receivable allowance ....................... 290 9 300 4
Capitalized research and development .................. 597 — 879 —
Purchased intangible assets .......................... 11 1,885 28 1,594
Restructuring .................................... 404 13 459 17
Equity investments ................................ 59 — 81 —
Deferred revenue ................................ 975 24 949 12
Other ......................................... 1,587 251 1,599 82
Gross deferred tax assets and liabilities ................. 21,180 9,814 20,508 9,413
Valuation allowance ............................... (8,755) — (8,678) —
Total deferred tax assets and liabilities ................. $12,425 $9,814 $11,830 $9,413
The breakdown between current and long-term deferred tax assets and deferred tax liabilities was
as follows for the following fiscal years ended October 31:
2010 2009
In millions
Current deferred tax assets .......................................... $5,833 $ 4,979
Current deferred tax liabilities ....................................... (53) (83)
Long-term deferred tax assets ........................................ 2,070 1,751
Long-term deferred tax liabilities ..................................... (5,239) (4,230)
Total deferred tax assets net of deferred tax liabilities ...................... $2,611 $ 2,417
As of October 31, 2010, HP had $2.8 billion, $4.1 billion and $29.8 billion of federal, state and
foreign net operating loss carryforwards, respectively. Amounts included in each of these respective
totals will begin to expire in fiscal 2011. HP also has a capital loss carryforward of approximately
$275 million which will expire in fiscal 2015. HP has provided a valuation allowance of $145 million for
deferred tax assets related to federal and state net operating losses, $106 million for deferred tax assets
related to capital loss carryforwards, and $8.0 billion for deferred tax assets related to foreign net
operating loss carryforwards that HP does not expect to realize.
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