Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Disclosure Of Major Components Of Tax Expense



	Year ended December 31
	2016			2017			2018
Current income tax expense:	(restated)			(restated)
Current year ⁽ⁱ⁾	$	48.3		$	39.3		$	44.4
Adjustments for prior years, including changes to net provisions related to tax uncertainties ⁽ⁱⁱ⁾	(34.1		)	(0.2		)	(4.7		)
	14.2			39.1			39.7
Deferred income tax expense (recovery):
Origination and reversal of temporary differences ⁽ⁱ⁾	20.0			(5.6		)	6.2
Changes in previously unrecognized tax losses and deductible temporary differences, including adjustments for prior years⁽ⁱⁱⁱ⁾	(9.5		)	(5.9		)	(62.9		)
	10.5			(11.5		)	(56.7		)
Income tax expense	$	24.7		$	27.6		$	(17.0	)

Disclosure Of Reconciliation Of Income Taxes Calculated At The Statutory Income Tax Rate To The Effective Tax Rate

A reconciliation of income taxes calculated at the statutory income tax rate to the income tax expense at the effective tax rate is as follows:



	Year ended December 31
	2016			2017			2018
	(restated)			(restated)
Earnings before income taxes	$	163.0		$	133.1		$	81.9
Income tax expense at Celestica’s statutory income tax rate of 26.5% (2017 and 2016 — 26.5%)	$	43.2		$	35.3		$	21.7
Impact on income taxes from:
Manufacturing and processing deduction	(0.1		)	(0.1		)	(0.1		)
Foreign income taxed at different rates	(0.1		)	(7.6		)	(9.1		)
Foreign exchange	4.8			(6.8		)	3.8
Other, including non-taxable/non-deductible items and changes to net provisions related to tax uncertainties ^(i)(ii)	(25.3		)	3.4			11.3
Change in unrecognized tax losses and deductible temporary differences ⁽ⁱⁱⁱ⁾	2.2			3.4			(44.6		)
Income tax expense	$	24.7		$	27.6		$	(17.0	)

(i)

These line items for 2016 and 2017 in the two tables above were negatively impacted by a deferred tax expense of $8.0 and $4.0, respectively, related to taxable temporary differences associated with the then-anticipated repatriation of undistributed earnings from certain of our Chinese subsidiaries, of which $6.0 and $3.5 was realized as a current tax expense for withholding tax on dividends paid in 2017 and 2018, respectively.


(ii)	These line items for 2016 in the two tables above were favorably impacted by the reversal of provisions of $34 previously recorded for tax uncertainties related to the resolution of a transfer pricing matter for one of our Canadian subsidiaries (discussed below).


(iii)	These line items for 2018 in the two tables above include the recognition of an aggregate of $53.3 of deferred tax assets in our U.S. group of subsidiaries (discussed below).

Changes In Deferred Tax Assets And Liabilities

Changes in deferred tax assets and liabilities for the periods indicated are as follows:



	Unrealized foreign exchange gains			Accounting provisions not currently deductible			Pensions and non-pension post-retirement benefits			Tax losses carried forward			Property, plant and equipment and intangibles			Other			Reclassification between deferred tax assets and deferred tax liabilities⁽ⁱ⁾			Total
Deferred tax assets*:
Balance — January 1, 2017	$	—		$	10.4		$	—		$	30.2		$	—		$	12.6		$	(17.9	)	$	35.3
Credited (charged) to net earnings	—			(1.9		)	—			4.5			—			(14.8		)	—			(12.2		)
Credited (charged) directly to equity	—			—			—			(1.7		)	—			—			—			(1.7		)
Effects of foreign exchange	—			0.3			—			1.6			—			—			—			1.9
Other	—			—			—			—			6.3			2.2			5.8			14.3
Balance — December 31, 2017	—			8.8			—			34.6			6.3			—			(12.1		)	37.6
Credited (charged) to net earnings	—			2.1			—			36.8			—			17.1			—			56.0
Credited (charged) directly to equity	—			—			—			(9.8		)	—			1.7			—			(8.1		)
Effects of foreign exchange	—			(0.1		)	—			(2.1		)	—			0.1			—			(2.1		)
Other	—			—			—			—			(6.3		)	(4.1		)	(36.3		)	(46.7		)
Balance — December 31, 2018	$	—		$	10.8		$	—		$	59.5		$	—		$	14.8		$	(48.4	)	$	36.7
Deferred tax liabilities*:
Balance — January 1, 2017	$	26.5		$	—		$	12.2		$	—		$	12.8		$	0.1		$	(16.2	)	$	35.4
Charged (credited) to net earnings	(2.9		)	—			0.1			—			(18.7		)	(2.8		)	—			(24.3		)
Charged (credited) directly to equity	—			—			(1.7		)	—			—			2.5			—			0.8
Effects of foreign exchange	1.6			—			—			—			(0.4		)	—			—			1.2
Other	—			—			—			—			6.3			4.3			4.1			14.7
Balance — December 31, 2017	25.2			—			10.6			—			—			4.1			(12.1		)	27.8
Charged (credited) to net earnings	1.5			—			—			—			(2.3		)	—			—			(0.8		)
Charged (credited) directly to equity	—			—			(9.9		)	—			—			—			—			(9.9		)
Additions from business combinations	—			—			—			—			56.6			—			—			56.6
Effects of foreign exchange	(2.1		)	—			0.1			—			0.5			—			—			(1.5		)
Other	—			—			—			—			(6.3		)	(4.1		)	(36.3		)	(46.7		)
Balance — December 31, 2018	$	24.6		$	—		$	0.8		$	—		$	48.5		$	—		$	(48.4	)	$	25.5


*	Certain of the 2017 figures have been restated to reflect the adoption of IFRS15.


(i)	This reclassification reflects the offsetting of deferred tax assets and deferred tax liabilities to the extent they relate to the same taxing authorities and there is a legally enforceable right to such offset.