Income Taxes (Tables)

12 Months Ended

May 31, 2022

Income Tax Disclosure [Abstract]

Income before Income Taxes

Income before income taxes as shown in the Consolidated Statements of Income is summarized below for the periods indicated.

Year Ended May 31,	2022		2021		2020
(In thousands)
United States	$	342,834	$	462,468	$	317,290
Foreign		263,965		205,970		90,474
Income Before Income Taxes	$	606,799	$	668,438	$	407,764

Provision (Benefit) for Income Tax

Provision (benefit) for income taxes consists of the following for the periods indicated:

Year Ended May 31,	2022			2021			2020
(In thousands)
Current:
U.S. federal	$	60,818		$	60,666		$	65,195
State and local		19,495			18,959			17,743
Foreign		59,087			65,125			31,894
Total Current		139,400			144,750			114,832
Deferred:
U.S. federal		(24,025	)		20,027			(19,212	)
State and local		2,489			3,878			(3,031	)
Foreign		(3,531	)		(3,717	)		10,093
Total Deferred		(25,067	)		20,188			(12,150	)
Provision for Income Taxes	$	114,333		$	164,938		$	102,682

Significant Components of Deferred Income Tax Assets and Liabilities

The significant components of deferred income tax assets and liabilities as of May 31, 2022 and 2021 were as follows:

	2022			2021
(In thousands)
Deferred income tax assets related to:
Inventories	$	15,967		$	12,189
Accrued compensation and benefits		22,224			24,637
Accrued other expenses		21,782			28,511
Deferred income and other long-term liabilities		25,389			22,859
Credit and net operating and capital loss carryforwards		63,368			65,091
Net unrealized loss on securities		9,386			9,189
Pension and other postretirement benefits		15,699			34,180
Total Deferred Income Tax Assets		173,815			196,656
Less: valuation allowances		(30,509	)		(64,696	)
Net Deferred Income Tax Assets		143,306			131,960
Deferred income tax (liabilities) related to:
Depreciation		(91,227	)		(85,717	)
Amortization of intangibles		(112,349	)		(107,963	)
Unremitted foreign earnings		(3,002	)		(17,871	)
Total Deferred Income Tax (Liabilities)		(206,578	)		(211,551	)
Deferred Income Tax Assets (Liabilities), Net	$	(63,272	)	$	(79,591	)

Reconciliation of Income Tax Expense (Benefit) Computed by Applying U.S. Statutory Federal Income Tax Rate against Income (Loss) before Income Taxes to Provision (Benefit) for Income Taxes

The following table reconciles income tax expense (benefit) computed by applying the U.S. statutory federal income tax rate against income (loss) before income taxes to the provision (benefit) for income taxes:

Year Ended May 31,	2022			2021			2020
(In thousands, except percentages)
Income tax expense at the U.S. statutory federal income tax rate	$	127,428		$	140,372		$	85,630
Foreign rate differential and other foreign tax adjustments		6,278			11,942			3,433
State and local income taxes, net		20,393			18,625			11,651
Impact of GILTI provisions		1,709			1,598			3,051
Nondeductible business expense		532			616			2,005
Valuation allowance		(32,720	)		(4,389	)		14,008
Deferred tax liability for unremitted foreign earnings		(10,686	)		5,348			(5,527	)
Changes in unrecognized tax benefits		(1,682	)		(1,847	)		1,292
Equity-based compensation		(1,776	)		(8,651	)		(5,162	)
FY19 GILTI impact of issued regulations		-			-			(4,348	)
Other		4,857			1,324			(3,351	)
Provision for Income Tax Expense	$	114,333		$	164,938		$	102,682
Effective Income Tax Rate		18.8	%		24.7	%		25.2	%

Activity Related to Unrecognized Tax Benefits

Uncertain income tax positions are accounted for in accordance with ASC 740. The following table summarizes the activity related to unrecognized tax benefits:

(In millions)	2022			2021			2020
Balance at June 1	$	7.5		$	9.0		$	8.1
Additions for tax positions of prior years		-			-			2.0
Reductions for tax positions of prior years		(1.7	)		(1.8	)		(0.9	)
Foreign currency translation		(0.1	)		0.3			(0.2	)
Balance at May 31	$	5.7		$	7.5		$	9.0