Note 16 - Income Taxes

The Company's provision for income taxes in interim periods is computed by applying the estimated annual effective tax rates to income or loss before income taxes for the period. In addition, non-recurring or discrete items, including interest on prior year tax liabilities, are recorded during the period(s) in which they occur.



	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Provision for income taxes	$	20.0		$	28.9		$	47.6		$	7.6
Effective tax rate	30.8		%	43.4		%	30.6		%	(8.5		)%

The effective tax rate in the second quarter of 2016 was calculated as the difference between the income taxes computed for the six months, as described below, and the year-to-date income taxes recorded as of March 31, 2016. This computation resulted in an effective tax rate of 30.8% for the second quarter of 2016, including discrete items.

The effective tax rate in the first six months of 2016 was computed based on an expected annual effective tax rate of 30.2%, excluding discrete items. Discrete tax items are recorded in the period in which they occur. The effective tax rate of 30.6% in the first six months of 2016 was lower than the U.S. federal statutory rate of 35% primarily due to tax benefits related to foreign tax credits, earnings in certain foreign jurisdictions where the effective tax rate is less than 35% and other U.S. tax benefits, such as the Research and Experimentation credit and the U.S. manufacturing deduction. These factors were partially offset by U.S. taxation of foreign earnings, losses at certain foreign subsidiaries where no tax benefit could be recorded, U.S. state and local taxes and the impact of certain discrete tax items during the period.

The effective tax rate in the second quarter of 2015 was calculated as the difference between the income taxes computed for the six months, as described below, and the year-to-date income taxes recorded as of March 31, 2015. This computation resulted in an effective tax rate of 43.4% for the second quarter of 2015, including discrete items.

The effective tax rate in the first six months of 2015 was computed based on an expected annual effective tax rate of negative 4.9%, excluding discrete items. At that time, the Company expected tax benefits on expected pretax income with an estimated effective tax rate of negative 8.5%, including discrete items. This rate reflected an expected full year loss in the U.S. primarily driven by pension settlement charges, and earnings in foreign jurisdictions, which was expected to produce a net tax benefit on pretax income. The expected effective tax rate of negative 8.5% was lower than the U.S. federal statutory rate of 35% primarily due to lower U.S. earnings due to pension settlement charges, earnings in certain foreign jurisdictions where the effective tax rate is less than 35%, tax benefits related to foreign tax credits, U.S. state and local taxes, non-deductible U.S. expenses and the U.S. manufacturing deduction. These factors were partially offset by U.S. taxation of foreign earnings, losses at certain foreign subsidiaries where no tax benefit could be recorded and certain discrete tax expenses.