Income Taxes

12 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Amounts have been revised to reflect the correction of certain immaterial misstatements.Refer to Note 1 of Notes to Consolidated Financial Statements, for further discussion. The provisions for income taxes from continuing operations consisted of the following:

	Fiscal Year
	2023		2022		2021
Currently payable:
United States - Federal	$	12.5	$	12.4	$	(2.8)
State	3.5		6.6		(0.1)
Foreign	21.5		19.4		22.6
Total current	37.5		38.4		19.7
Deferred:
United States - Federal	(4.5)		(7.6)		7.9
State	(0.6)		(0.6)		0.3
Foreign	0.6		(5.6)		1.4
Total deferred	(4.5)		(13.8)		9.6
Income tax provision	$	33.0	$	24.6	$	29.3

Amounts have been revised to reflect the correction of certain immaterial misstatements. Refer to Note 1 of Notes to Consolidated Financial Statements, for further discussion. The source of pre-tax earnings was:

	Fiscal Year
	2023		2022		2021
United States	$	37.6	$	2.6	$	(10.4)
Foreign	110.1		121.5		157.5
Pre-tax earnings	$	147.7	$	124.1	$	147.1

Amounts have been revised to reflect the correction of certain immaterial misstatements. Refer to Note 1 of Notes to Consolidated Financial Statements, for further discussion. A reconciliation of income taxes with the amounts computed at the statutory federal income tax rate follows:

	Fiscal Year
	2023				2022				2021
Computed tax at federal statutory rate	$	31.0	21.0	%	$	25.8	21.0	%	$	30.7	21.0	%
State income taxes, net of federal tax benefit	2.7		1.8		2.7		2.2		0.8		0.6
Foreign tax less than the federal rate (1)	(1.0)		(0.7)		(11.7)		(9.5)		(9.0)		(6.2)
Adjustments to prior years’ tax accruals	(6.1)		(4.2)		1.6		1.3		(4.3)		(2.9)
Other taxes including repatriation of foreign earnings	4.4		3.1		4.6		3.7		8.9		6.1
Other, net	1.4		0.9		3.9		3.2		2.7		1.8
Uncertain tax positions	0.6		0.4		(2.3)		(2.0)		(0.5)		(0.6)
Total	$	33.0	22.3	%	$	24.6	19.9	%	$	29.3	19.8	%

(1) Includes the impact of foreign valuation allowances.

The deferred tax assets and deferred tax liabilities recorded on the balance sheet were as follows, and include current and noncurrent amounts: 

	September 30,
	2023		2022
Deferred tax liabilities:
Depreciation and property differences	$	(20.8)	$	(22.8)
Amortizable assets	(230.2)		(229.4)
Lease liabilities	(15.2)		(13.0)
Other tax liabilities	(4.3)		(3.9)
Gross deferred tax liabilities	(270.5)		(269.1)
Deferred tax assets:
Accrued liabilities	56.6		55.8
Deferred and share-based compensation	14.9		13.7
Tax carryforwards and tax credits	37.3		26.0
Postretirement benefits other than pensions	1.0		1.1
Pension plans	25.0		24.0
Inventory differences	5.0		5.8
Lease right of use assets	15.3		13.1
Deferred revenue	7.0		9.7
Other tax assets	8.0		8.1
Gross deferred tax assets	170.1		157.3
Valuation allowance	(18.3)		(10.3)
Net deferred tax liabilities	$	(118.7)	$	(122.1)

There were no material tax loss carryforwards that expired in fiscal 2023. Future expirations of tax loss carryforwards and tax credits, if not utilized, are not expected to be material from 2023 through 2040. The remaining tax loss carryforwards and credits have no expiration. The valuation allowance is primarily attributable to tax loss carryforwards, other carryforwards, and certain deferred tax assets impacted by the deconsolidation of the Company’s Venezuelan subsidiaries.

The Company generally repatriates a portion of current year earnings from select non-US subsidiaries only if the economic cost of the repatriation is not considered material. No provision is made for additional taxes on undistributed earnings of foreign affiliates that are intended and planned to be indefinitely invested in the affiliate. The Company intends to, and has plans to, reinvest these earnings indefinitely in its foreign subsidiaries to, amongst other things, fund local operations, fund pension and other post-retirement obligations, fund capital projects and to support foreign growth initiatives including potential acquisitions. As of September 30, 2023, approximately $897.0 of foreign subsidiary earnings were considered indefinitely invested in those businesses. If the Company repatriated any of the earnings it could be subject to withholding tax and the impact of foreign currency movements. Accordingly, it is not practical to calculate a specific potential tax exposure. Applicable income and withholding taxes will be provided on these earnings in the periods in which they are no longer considered reinvested.

Amounts have been revised to reflect the correction of certain immaterial misstatements. Refer to Note 1 of Notes to Consolidated Financial Statements, for further discussion. Unrecognized tax benefits activity is summarized below:

	2023		2022		2021
Unrecognized tax benefits, beginning of year	$	19.4	$	21.9	$	22.4
Additions based on current year tax positions and acquisitions	1.9		2.1		2.0
Settlements with taxing authorities and statute expirations	(1.6)		(4.6)		(2.5)
Unrecognized tax benefits, end of year	$	19.7	$	19.4	$	21.9

Included in the unrecognized tax benefits noted above was $18.7 of uncertain tax positions that would affect the Company’s effective tax rate, if recognized. The Company does not expect any significant increases or decreases to its unrecognized tax benefits within 12 months of this reporting date. In the Consolidated Balance Sheets, unrecognized tax benefits are classified as Other liabilities (non-current) to the extent that payments are not anticipated within one year.

The Company classifies accrued interest and penalties related to unrecognized tax benefits in the income tax provision. The accrued interest and penalties are not included in the table above. The Company accrued approximately $4.4 of interest, (net of the deferred tax asset of $0.8) at September 30, 2023, and $4.1 of interest, (net of the deferred tax asset of $0.7) at September 30, 2022. Interest was computed on the difference between the tax position recognized in accordance with GAAP and the amount previously taken or expected to be taken in the Company’s tax returns.

The Company files income tax returns in the U.S. federal jurisdiction, various cities and states, and more than 30 foreign jurisdictions where the Company has operations. In general, U.S. federal income tax returns for tax years ended September 30, 2020 and after remain subject to examination by the Internal Revenue Service (the “IRS”). With few exceptions, the Company is no longer subject to state and local income tax examinations for years before September 30, 2013. The status of international income tax examinations varies by jurisdiction. At this time, the Company does not anticipate any material adjustments to its financial statements resulting from tax examinations currently in progress.