Income Taxes (Tables)

12 Months Ended

Oct. 31, 2018

The provision for income taxes consists of the following:

The following is a reconciliation of the provision for income taxes based on the federal statutory rate to the Company’s effective income tax rate:



	Year Ended October 31,
	2018		2017		2016
Federal statutory rate	23.33	%	35.00	%	35.00	%
Impact of foreign tax rate differential	(0.57	)%	(9.86	)%	(11.15	)%
State and local taxes, net of federal tax benefit	2.38	%	1.35	%	2.19	%
Net impact of changes in valuation allowances	5.65	%	20.74	%	1.91	%
Non-deductible write-off and impairment of goodwill and other intangible assets	0.06	%	(0.02	)%	7.37	%
Unrecognized tax benefits	3.41	%	(2.00	)%	4.84	%
Permanent book-tax differences	(4.03	)%	(15.71	)%	(4.78	)%
Withholding taxes	1.84	%	1.88	%	4.64	%
Tax Reform Act ⁽¹⁾	(7.31	)%	—	%	—	%
Other items, net	(0.33	)%	2.20	%	7.08	%
	24.43	%	33.58	%	47.10	%

⁽¹⁾Reflects the net impact of the change in deferred tax assets and liabilities and the estimated transition tax resulting from the Tax Reform Act.

The components of the Company’s deferred tax assets and liabilities as of October 31 for the years indicated were as follows:



(in millions)	2018			2017
Deferred Tax Assets
Net operating loss and other carryforwards	$	122.8		$	116.4
Foreign tax credits	20.7			5.1
Pension liabilities	12.2			38.8
Incentive liabilities	12.1			14.7
Workers compensation accruals	6.6			4.5
Inventories	4.9			7.6
State income taxes	4.5			7.1
Deferred compensation	2.2			4.2
Other	16.5			30.0
Total Deferred Tax Assets	202.5			228.4
Valuation allowance	(157.2		)	(132.4		)
Net Deferred Tax Assets	$	45.3		$	96.0

Deferred Tax Liabilities
Properties, plants and equipment	$	78.9		$	99.1
Timberland transactions	73.5			113.5
Goodwill and other intangible assets	49.2			74.0
Other	15.6			16.7
Total Deferred Tax Liabilities	217.2			303.3
Net Deferred Tax Liability	$	171.9		$	207.3

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



(in millions)	2018			2017			2016
Balance at November 1	$	26.8		$	29.7		$	29.6
Increases in tax positions for prior years	7.8			2.1			5.7
Decreases in tax positions for prior years	(1.4		)	(1.8		)	(10.5		)
Increases in tax positions for current years	8.0			6.7			6.9
Settlements with taxing authorities	—			(7.4		)	—
Lapse in statute of limitations	(3.6		)	(4.6		)	(2.6		)
Currency translation	(1.4		)	2.1			0.6
Balance at October 31	$	36.2		$	26.8		$	29.7