Income Taxes (Tables)

12 Months Ended

Jun. 30, 2012

Provision for Income Taxes

The components of the provision for income taxes were as follows:

(In millions)
Year Ended June 30,	2012		2011		2010
Current Taxes
U.S. federal	$	2,235	$	3,108	$	4,415
U.S. state and local		153		209		357
International		1,947		1,602		1,701
Current taxes		4,335		4,919		6,473
Deferred Taxes
Deferred taxes		954		2		(220	)
Provision for income taxes	$	5,289	$	4,921	$	6,253

Income Before Income Taxes

U.S. and international components of income before income taxes were as follows:

(In millions)
Year Ended June 30,	2012		2011		2010
U.S.	$	1,600	$	8,862	$	9,575
International		20,667		19,209		15,438
Income before income taxes	$	22,267	$	28,071	$	25,013

Difference Between Income Taxes Computed at Federal Statutory Rate and Provision for Income Taxes

The items accounting for the difference between income taxes computed at the U.S. federal statutory rate and our effective rate were as follows:

Year Ended June 30,	2012		2011		2010
Federal statutory rate		35.0%		35.0%		35.0%
Effect of:
Foreign earnings taxed at lower rates		(21.1)%		(15.6)%		(12.1)%
Goodwill impairment		9.7%		0%		0%
I.R.S. settlement		0%		(1.7)%		0%
Other reconciling items, net		0.2%		(0.2)%		2.1%
Effective rate		23.8%		17.5%		25.0%

Deferred Income Tax Assets and Liabilities

The components of the deferred income tax assets and liabilities were as follows:

(In millions)
June 30,	2012			2011
Deferred Income Tax Assets
Stock-based compensation expense	$	882		$	1,079
Other expense items		965			1,321
Unearned revenue		571			463
Impaired investments		152			424
Loss carryforwards		532			90
Other revenue items		79			69
Deferred income tax assets	$	3,181		$	3,446
Less valuation allowance		(453	)		0
Deferred income tax assets, net of valuation allowance	$	2,728		$	3,446
Deferred Income Tax Liabilities
International earnings	$	(1,072	)	$	(1,266	)
Unrealized gain on investments		(830	)		(904	)
Depreciation and amortization		(670	)		(265	)
Other		(14	)		0
Deferred income tax liabilities		(2,586	)		(2,435	)
Net deferred income tax assets	$	142		$	1,011
Reported As
Current deferred income tax assets	$	2,035		$	2,467
Long-term deferred income tax liabilities		(1,893	)		(1,456	)
Net deferred income tax assets	$	142		$	1,011

Changes in Unrecognized Tax Benefits

The aggregate changes in the balance of unrecognized tax benefits were as follows:

(In millions)
Year Ended June 30,	2012			2011			2010
Balance, beginning of year	$	6,935		$	6,542		$	5,403
Decreases related to settlements		(16	)		(632	)		(57	)
Increases for tax positions related to the current year		481			739			1,012
Increases for tax positions related to prior years		118			405			364
Decreases for tax positions related to prior years		(292	)		(119	)		(166	)
Decreases due to lapsed statutes of limitations		(24	)		0			(14	)
Balance, end of year	$	7,202		$	6,935		$	6,542