Symantec 2016 Annual Report Download - page 123

possible outcomes of current and future audits conducted by foreign and domestic tax authorities. Changes in tax
laws or our interpretation of tax laws and the resolution of current and future tax audits could significantly impact
the amounts provided for income taxes in our Consolidated Balance Sheets and Consolidated Statements of
Operations.
Our effective tax rate includes the impact of providing U.S. taxes on certain undistributed foreign earnings
attributable to the sale of Veritas as well as the impact of certain undistributed foreign earnings for which no U.S.
taxes have been provided because such earnings are planned to be indefinitely reinvested outside the U.S. While
we do not anticipate changing our intention regarding indefinitely reinvested earnings outside the U.S., material
changes in our estimates of such earnings or tax legislation that limits or restricts the amount of such earnings
could materially impact our income tax provision and effective tax rate. If certain foreign earnings previously
treated as indefinitely reinvested outside the U.S. are repatriated, the related U.S. tax liability may be reduced by
any foreign income taxes paid on these earnings.
We account for uncertain tax positions pursuant to authoritative guidance based on a two-step approach to
recognize and measure those positions taken or expected to be taken in a tax return. The first step is to determine
if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained
on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax
benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. We adjust
reserves for our uncertain tax positions due to changing facts and circumstances, such as the closing of a tax
audit, the refinement of estimates, or the realization of earnings or deductions that differ from our estimates. To
the extent that the final outcome of these matters is different than the amounts recorded, such differences will
impact our tax provision in our Consolidated Statements of Operations in the period in which such determination
is made.
We must also assess the likelihood that deferred tax assets will be realized from future taxable income and,
based on this assessment establish a valuation allowance, if required. The determination of our valuation
allowance involves assumptions, judgments and estimates, including forecasted earnings, future taxable income,
and the relative proportions of revenue and income before taxes in the various domestic and international
jurisdictions in which we operate. To the extent we establish a valuation allowance or change the valuation
allowance in a period, we reflect the change with a corresponding increase or decrease to our tax provision in our
Consolidated Statements of Operations.
Recently issued authoritative guidance
See Note 1 of the Notes to Consolidated Financial Statements in this annual report for recently issued
authoritative guidance, including the respective expected dates of adoption and effects on our results of
operations and financial condition.
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