Income Taxes

3 Months Ended

Jul. 02, 2011


9.	Income Taxes

Uncertain Income Tax Benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest and penalties, for the three months ended July 2, 2011 and July 3, 2010 is presented below:


	Three Months Ended
	July 2,			July 3,
	2011			2010
	(millions)

Unrecognized tax benefits beginning balance	$	125.0		$	96.2
Additions related to current period tax positions		1.0			0.8
Additions related to prior period tax positions		0.1			24.8
Reductions related to prior period tax positions		(0.4	)		(8.1	)
Additions (reductions) related to foreign currency translation		1.3			(2.2	)

Unrecognized tax benefits ending balance	$	127.0		$	111.5

The Company classifies interest and penalties related to unrecognized tax benefits as part of its provision for income taxes. A reconciliation of the beginning and ending amounts of accrued interest and penalties related to unrecognized tax benefits for the three months ended July 2, 2011 and July 3, 2010 is presented below:


	Three Months Ended
	July 2,		July 3,
	2011		2010
	(millions)

Accrued interest and penalties beginning balance	$	31.4	$	29.8
Net additions charged to expense		2.0		0.9
Additions (reductions) related to foreign currency translation		0.4		(0.5	)

Accrued interest and penalties ending balance	$	33.8	$	30.2

The total amount of unrecognized tax benefits, including interest and penalties, was $160.8 million as of July 2, 2011 and $156.4 million as of April 2, 2011 and is included within non-current liability for unrecognized tax benefits in the consolidated balance sheets. The total amount of unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate was $114.6 million as of July 2, 2011.

Future Changes in Unrecognized Tax Benefits

The total amount of unrecognized tax benefits relating to the Company’s tax positions is subject to change based on future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, the Company does not anticipate that the balance of gross unrecognized tax benefits, excluding interest and penalties, will change significantly during the next 12 months. However, changes in the occurrence, expected outcomes and timing of those events could cause the Company’s current estimate to change materially in the future.

The Company files tax returns in the U.S. federal and various state, local and foreign jurisdictions. With few exceptions for those tax returns, the Company is no longer subject to examinations by the relevant tax authorities for years prior to Fiscal 2004.