Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Components of Income from Continuing Operations Before Income Taxes and Equity in Net Income of Affiliates

The components of income from continuing operations before income taxes and equity in net income of affiliates, were:


	Year Ended December 31,
(IN MILLIONS)	2012		2011		2010
Dutch	$	46	$	35	$	146
Non-Dutch		398		94		(43	)

Income from continuing operations before income taxes and equity in net income of affiliates	$	444	$	129	$	103

Provision/(Benefit) for Income Taxes Attributable to Income from Continuing Operations Before Income Taxes and Equity in Net Income of Affiliates

The provision/(benefit) for income taxes attributable to the income from continuing operations before income taxes and equity in net income of affiliates consisted of:


	Year ended December 31,
(IN MILLIONS)	2012			2011			2010
Current:
Dutch	$	8		$	1		$	13
Non-Dutch		117			144			117

		125			145			130

Deferred:
Dutch		(1	)		(13	)		(3	)
Non-Dutch		22			(111	)		(173	)

		21			(124	)		(176	)

Total	$	146		$	21		$	(46	)

Schedule of Provision/(Benefit) for Income Taxes as Per Dutch Federal Income Tax Rates

The Company’s provision/(benefit) for income taxes for the years ended December 31, 2012, 2011 and 2010 was different from the amount computed by applying the statutory Dutch federal income tax rates to the underlying income from continuing operations before income taxes and equity in net income of affiliates as a result of the following:


	Year ended December 31,
(IN MILLIONS)	2012			2011			2010
Income from continuing operations before income taxes and equity in net income of affiliates	$	444		$	129		$	103

Dutch statutory tax rate		25.0	%		25.0	%		25.5	%

Provision/(benefit) for income taxes at the Dutch statutory rate	$	111		$	32		$	26
Impairment of goodwill and intangible assets		—			—			—
Basis difference in sale of subsidiary		—			—			—
Tax impact on distributions from foreign subsidiaries		35			9			1
Effect of operations in non-Dutch jurisdictions, including foreign tax credits		15			(3	)		(35	)
U.S. state and local taxation		7			(4	)		(24	)
Withholding and other taxation		36			30			29
Effect of global financing activities		(51	)		(38	)		(28	)
Changes in estimates for uncertain tax positions		43			12			2
Changes in valuation allowances		(16	)		(25	)		(25	)
Effect of change in deferred tax rates		(40	)		—			—
Other, net		6			8			8

Total (benefit)/provision for income taxes	$	146		$	21		$	(46	)

Effective tax rate		32.9	%		16.3	%		(44.7	%)

Components of Current and Non-Current Deferred Income Tax Assets/(Liabilities)

The components of current and non-current deferred income tax assets/(liabilities) were:


(IN MILLIONS)	December 31, 2012			December 31, 2011
Deferred tax assets (on balance):
Net operating loss carryforwards	$	348		$	394
Interest expense limitation		577			557
Deferred compensation		7			6
Deferred revenues/costs		29			31
Employee benefits		59			51
Tax credit carryforwards		113			96
Share-based payments		59			46
Accrued expenses		26			35
Other assets		52			38

		1,270			1,254
Valuation allowances		(248	)		(193	)

Deferred tax assets, net of valuation allowances		1,022			1,061

Deferred tax liabilities (on balance):
Intangible assets		(1,661	)		(1,723	)
Financial instruments		(50	)		(54	)
Fixed asset depreciation		(21	)		(4	)
Computer software		(69	)		(43	)
		(1,801	)		(1,824	)

Net deferred tax liability	$	(779	)	$	(763	)

Recognized as:
Deferred income taxes, current	$	58		$	57
Deferred income taxes, non-current		(837	)		(820	)

Total	$	(779	)	$	(763	)

Schedule of Reconciliation of Beginning and Ending Amount of Uncertain Tax Positions

A reconciliation of the beginning and ending amount of uncertain tax positions is as follows:


(IN MILLIONS)	December 31, 2012			December 31, 2011			December 31, 2010
Balance as of the beginning of period	$	96		$	114		$	129
Additions for current year tax positions		1			4			3
Additions for tax positions of prior years		16			—			5
Reductions for lapses of statute of limitations		(19	)		(22	)		(22	)
Effect of foreign currency translation		—			—			(1	)

Balance as of the end of the period	$	94		$	96		$	114