Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

Components of Earnings Before Income Taxes

The components of earnings before income taxes consisted of the following (in millions):

	For the Years Ended December 31,
	2016			2015			2014
United States operations	$	(251.8	)	$	(246.2	)	$	403.3
Foreign operations		651.4			399.4			536.1
Total	$	399.6		$	153.2		$	939.4

Provision for Income Taxes and Income Taxes Paid

The provision for income taxes and the income taxes paid consisted of the following (in millions):
Current:
Federal	$	134.2		$	55.8		$	178.2
State		12.4			18.9			16.5
Foreign		101.6			96.3			116.0
		248.2			171.0			310.7
Deferred:
Federal		(108.5	)		(120.6	)		(54.8	)
State		2.3			(20.0	)		(6.6	)
Foreign		(47.0	)		(23.4	)		(29.1	)
		(153.2	)		(164.0	)		(90.5	)
Provision for income taxes	$	95.0		$	7.0		$	220.2
Income taxes paid	$	269.6		$	193.6		$	340.1

Reconciliation of U.S. Statutory Income Tax Rate to Our Effective Tax Rate

A reconciliation of the U.S. statutory income tax rate to our effective tax rate is as follows:

	For the Years Ended December 31,
	2016			2015			2014
U.S. statutory income tax rate		35.0	%		35.0	%		35.0	%
State taxes, net of federal deduction		2.0			(1.7	)		0.8
Tax impact of foreign operations, including foreign tax credits		(11.0	)		(62.3	)		(14.2	)
Change in valuation allowance		–			(3.7	)		–
Non-deductible expenses		0.9			2.4			–
Tax impact of certain significant transactions		1.6			21.6			1.4
Tax benefit relating to U.S. manufacturer’s deduction and export sales		(4.7	)		(6.2	)		(1.9	)
R&D credit		(1.9	)		(4.2	)		(0.2	)
Share based compensation		(2.9	)		1.1			0.2
Net uncertain tax positions, including interest and penalties		4.2			22.9			2.2
Other		0.6			(0.3	)		0.1
Effective income tax rate		23.8	%		4.6	%		23.4	%

Components of Deferred Taxes

The components of deferred taxes consisted of the following (in millions):

	As of December 31,
	2016			2015
Deferred tax assets:
Inventory	$	260.3		$	159.7
Net operating loss carryover		181.3			117.4
Tax credit carryover		110.4			207.8
Capital loss carryover		2.3			4.2
Accrued liabilities		182.2			190.2
Share-based compensation		60.3			59.0
Accounts receivable		22.3			23.7
Other		101.9			133.6
Total deferred tax assets		921.0			895.6
Less: Valuation allowances		(88.3	)		(72.7	)
Total deferred tax assets after valuation allowances		832.7			822.9
Deferred tax liabilities:
Fixed assets	$	138.7		$	144.6
Intangible assets		2,343.7			2,337.2
Unremitted earnings of foreign subsidiaries		1,159.4			1,374.8
Other		–			4.3
Total deferred tax liabilities		3,641.8			3,860.9
Total net deferred income taxes	$	(2,809.1	)	$	(3,038.0	)

Tabular Reconciliation of Total Amounts of Unrecognized Tax Benefits

The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in millions):

	For the Years Ended December 31,
	2016			2015			2014
Balance at January 1	$	591.9		$	321.7		$	311.0
Increases related to business combinations*		70.2			247.6			–
Increases related to prior periods		36.7			1.3			0.9
Decreases related to prior periods		(94.7	)		–			(3.8	)
Increases related to current period		53.0			25.7			18.3
Decreases related to settlements with taxing authorities		(3.2	)		(1.4	)		(3.0	)
Decreases related to lapse of statute of limitations		(4.6	)		(3.0	)		(1.7	)
Balance at December 31	$	649.3		$	591.9		$	321.7
Amounts impacting effective tax rate, if recognized balance at December 31*	$	511.5		$	443.7		$	186.3

* Subject to change during measurement period of business combinations.