Proctor and Gamble 2008 Annual Report Download - page 75

NotestoConsolidatedFinancialStatements TheProcter&GambleCompany 73
Amountsinmillionsofdollarsexceptpershareamountsorasotherwisespecied.
above.Atthistimewearenotabletomakeareasonableestimateof
therangeofimpactonthebalanceofunrecognizedtaxbenetsor
theimpactontheeffectivetaxraterelatedtotheseitems.
Taxbenetscreditedtoshareholders’equitytotaled$1,823and
$1,066fortheyearsendedJune30,2008and2007,respectively.
Theseprimarilyrelatetothetaxeffectsofnetinvestmenthedges,
excesstaxbenetsfromtheexerciseofstockoptionsandtheimpacts
ofcertainadjustmentstopensionandotherretireebenetobligations
recordedinshareholders’equity,includingtheimpactofadopting
SFAS158in2007.
Wehaveundistributedearningsofforeignsubsidiariesofapproximately
$21billionatJune30,2008,forwhichdeferredtaxeshavenotbeen
provided.Suchearningsareconsideredindenitelyinvestedinthe
foreignsubsidiaries.Ifsuchearningswererepatriated,additionaltax
expensemayresult,althoughthecalculationofsuchadditionaltaxes
isnotpracticable.
Deferredincometaxassetsandliabilitieswerecomprisedofthe
following:
June30    2007

Stock-basedcompensation     $ 1,132
Unrealizedlossonnancialand
foreignexchangetransactions   723
Pensionandpostretirementbenets   560
Lossandothercarryforwards    439
Advancepayments    183
Goodwillandotherintangibleassets   249
Accruedmarketingandpromotionexpense   161
Accruedinterestandtaxes    —
Inventory    95
Fixedassets    85
Other    1,119
Valuationallowances    (190)
  4,556

Goodwillandotherintangibleassets   $12,102
Fixedassets    1,884
Other    132
  14,118
Netoperatinglosscarryforwardswere$1,515and$1,442atJune30,
2008and2007,respectively.Ifunused,$629willexpirebetween2009
and2028.Theremainder,totaling$886atJune30,2008,maybe
carriedforwardindenitely.
NOTE 11


Inconjunctionwithcertaintransactions,primarilydivestitures,wemay
provideroutineindemnications(e.g.,indemnicationforrepresenta-
tionsandwarrantiesandretentionofpreviouslyexistingenvironmental,
taxandemployeeliabilities)ofwhichtermsrangeindurationandin
somecircumstancesarenotexplicitlydened.Themaximumobligation
undersomeindemnicationsisnotexplicitlystatedand,asaresult,
theoverallamountoftheseobligationscannotbereasonablyesti-
mated.Otherthanobligationsrecordedasliabilitiesatthetimeof
divestiture,wehavenotmadesignicantpaymentsfortheseindem-
nications.Webelievethatifweweretoincuralossonanyofthese
matters,thelosswouldnothaveamaterialeffectonournancial
position,resultsofoperationsorcashows.
Incertainsituations,weguaranteeloansforsuppliersandcustomers.
Thetotalamountofguaranteesissuedundersucharrangementsis
notmaterial.

Wedonothaveoff-balancesheetnancingarrangements,including
variableinterestentities,underFIN46(R),“ConsolidationofVariable
InterestEntities,”thathaveamaterialimpactonournancial
statements.

Wehavepurchasecommitmentsformaterials,supplies,servicesand
property,plantandequipmentaspartofthenormalcourseofbusiness.
Commitmentsmadeundertake-or-payobligationsareasfollows:
2009–$1,205;2010–$917;2011–$745;2012–$688;2013–$408;
and$363thereafter.Suchamountsrepresentfuturepurchasesinline
withexpectedusagetoobtainfavorablepricing.Approximately35%
ofourpurchasecommitmentsrelatetoservicecontractsforinformation
technology,humanresourcesmanagementandfacilitiesmanagement
activitiesthatwereoutsourcedinrecentyears.Duetotheproprietary
natureofmanyofourmaterialsandprocesses,certainsupplycontracts
containpenaltyprovisionsforearlytermination.Wedonotexpectto
incurpenaltypaymentsundertheseprovisionsthatwouldmaterially
affectournancialposition,resultsofoperationsorcashows.

Weleasecertainpropertyandequipmentforvaryingperiods.Future
minimumrentalcommitmentsundernoncancelableoperatingleases
areasfollows:2009–$299;2010–$288;2011–$240;2012–$196;
2013–$185;and$448thereafter.Operatingleaseobligationsare
shownnetofguaranteedsubleaseincome.