Taxes on Earnings (Tables)

12 Months Ended

Sep. 28, 2018

Taxes on earnings from continuing operations were as follows:

Earnings from continuing operations before taxes are generated from the following geographic areas:

The effective tax rate on continuing operations differs from the U.S. federal statutory tax rate as a result of the following:



	Fiscal Years
	2018		2017		2016
Federal statutory income tax rate	24.6	%	35.0	%	35.0	%
Impact of U.S. Tax Reform	46.3	%	—	%	—	%
State and local taxes, net of federal tax benefit	0.5	%	0.9	%	0.2	%
Non-U.S. income taxed at different rates, net	(0.6	)%	(8.4	)%	(9.3	)%
Resolution of tax contingencies to due to expiration of statutes of limitation	(2.5	)%	(1.7	)%	(1.2	)%
Change in acquirer's deferred taxes related to purchase accounting	(1.8	)%	—	%	—	%
Excess stock deduction	(1.5	)%	—	%	—	%
Other	1.8	%	(0.4	)%	0.8	%
Effective tax rate	66.8	%	25.4	%	25.5	%

Significant components of deferred tax assets and liabilities are as follows:



	September 28,			September 29,
(In millions)	2018			2017
Deferred Tax Assets:
Deferred revenues	$	13.2		$	40.8
Deferred compensation	34.6			45.0
Product warranty	7.5			9.6
Inventory adjustments	7.6			11.1
Share-based compensation	13.7			17.8
Environmental reserve	2.2			3.9
Accruals and reserves	12.1			20.1
Net operating loss carryforwards	132.0			124.4
Other	24.2			29.7
	247.1			302.4
Valuation allowance	(101.6		)	(105.8		)
Total deferred tax assets	145.5			196.6
Deferred Tax Liabilities:
Tax-deductible goodwill	(31.6		)	(27.7		)
Property, plant and equipment	(9.4		)	(13.6		)
Unremitted earnings of foreign subsidiaries	(20.4		)	(16.2		)
Other	(13.3		)	(8.9		)
Total deferred tax liabilities	(74.7		)	(66.4		)
Net deferred tax assets	$	70.8		$	130.2
Reported As:
Deferred tax assets	$	102.2		$	147.3
Deferred tax liabilities (included in other long-term liabilities)	(31.4		)	(17.1		)
Net deferred tax assets	$	70.8		$	130.2

Income taxes paid were as follows:



	Fiscal Years
(In millions)	2018		2017		2016
Federal income taxes paid, net	$	10.6	$	62.0	$	78.3
State, income taxes paid, net	7.2		5.0		5.0
Foreign income taxes paid, net	68.2		77.1		72.6
Total income taxes paid, net	$	86.0	$	144.1	$	155.9

Changes in the Company’s unrecognized tax benefits were as follows:



	Fiscal Years
(In millions)	2018			2017			2016
Unrecognized tax benefits balance–beginning of fiscal year	$	42.7		$	40.7		$	39.5
Additions based on tax positions related to a prior year	1.1			1.4			0.6
Reductions based on tax positions related to a prior year	(3.0		)	(0.3		)	(0.8		)
Additions based on tax positions related to the current year	14.8			5.8			6.6
Settlements	(2.8		)	—			—
Reductions resulting from the expiration of the applicable statute of limitations	(9.3		)	(4.9		)	(5.2		)
Unrecognized tax benefits balance–end of fiscal year	$	43.5		$	42.7		$	40.7