Starbucks 2014 Annual Report Download - page 80

76 Starbucks Corporation 2014 Form 10-K
Tax effect of temporary differences and carryforwards that comprise significant portions of deferred tax assets and liabilities (in
millions):
Sep 28, 2014 Sep 29, 2013
Deferred tax assets:
Property, plant and equipment $ 78.5 $ 64.9
Accrued occupancy costs 58.8 69.0
Accrued compensation and related costs 75.3 77.6
Other accrued liabilities 27.6 22.0
Asset retirement obligation asset 18.6 21.0
Deferred revenue 63.4 49.9
Asset impairments 49.5 33.3
Tax credits 20.3 19.1
Stock-based compensation 131.5 120.9
Net operating losses 104.4 99.0
Litigation charge 1,002.0 1,071.9
Other 77.0 62.7
Total $ 1,706.9 $ 1,711.3
Valuation allowance (166.8)(160.5)
Total deferred tax asset, net of valuation allowance $ 1,540.1 $ 1,550.8
Deferred tax liabilities:
Property, plant and equipment (148.2)(182.9)
Intangible assets and goodwill (92.9)(81.6)
Other (89.4)(53.1)
Total (330.5)(317.6)
Net deferred tax asset $ 1,209.6 $ 1,233.2
Reported as:
Current deferred income tax assets $ 317.4 $ 277.3
Long-term deferred income tax assets 903.3 967.0
Current deferred income tax liabilities (included in Accrued liabilities) (4.2)(1.0)
Long-term deferred income tax liabilities (included in Other long-term liabilities) (6.9)(10.1)
Net deferred tax asset $ 1,209.6 $ 1,233.2
The valuation allowance as of September 28, 2014 and September 29, 2013 is primarily related to net operating losses and
other deferred tax assets of consolidated foreign subsidiaries. The net change in the total valuation allowance was an increase of
$6.3 million for both fiscal 2014 and 2013.
As of September 28, 2014, Starbucks has state tax credit carryforwards of $31.2 million with an expiration date of fiscal 2024.
Starbucks has foreign net operating loss carryforwards of $342.4 million, with the predominant amount having no expiration
date.
Uncertain Tax Positions
As of September 28, 2014, we had $112.7 million of gross unrecognized tax benefits of which $85.3 million, if recognized,
would affect our effective tax rate. We recognized expense of $5.9 million, a benefit of $0.8 million, and a benefit of $0.7
million of interest and penalties in income tax expense, prior to the benefit of the federal tax deduction, for fiscal 2014, 2013
and 2012, respectively. As of September 28, 2014 and September 29, 2013, we had accrued interest and penalties of $10.6
million and $4.7 million, respectively, before the benefit of the federal tax deduction, included within the related tax liability on
the consolidated balance sheets.