Income Taxes (Tables)

12 Months Ended

Dec. 31, 2011

Income Taxes [Abstract]

Reconciliation of the provision for income taxes computed at Federal statutory rates to the effective rates

The following is a reconciliation of the provision for income taxes computed at federal statutory rates to the effective rates for the years ended December 31, 2011, 2010 and 2009:

	2011	2010	2009
Consolidated tax provision at federal statutory rate	35.0%	35.0%	35.0%
State income tax provisions, net of federal income tax benefit	2.8	3.2	2.8
Reversal of tax credits	4.4	-	-
Non-deductible transaction costs	-	4.2	-
Tax reserve adjustment	(5.5)	0.4	-
All other, net	(0.8)	(0.3)	(1.6)
Effective tax rate	35.9 %	42.5 %	36.2 %

Components of Net Deferred Income Tax Liability (Asset)

The components of the net deferred income tax liability (asset) at December 31 are as follows:

($ in thousands)				2011	2010
Deferred income tax liabilities:
	Property, plant and equipment basis differences			$      1,896,666	$   1,448,061
	Intangibles			997,455	1,145,760
	Other, net			17,584	10,170
				2,911,705	2,603,991
Deferred income tax assets:
	Pension liability			246,714	176,579
	Tax operating loss carryforward			294,171	148,338
	Employee benefits			154,711	189,558
	State tax liability			7,358	13,241
	Accrued expenses			27,645	75,407
	Allowance for doubtful accounts			42,733	37,511
	Other, net			22,313	4,238
				795,645	644,872
		Less: Valuation allowance		(108,662)	(115,585)
	Net deferred income tax asset			686,983	529,287
		Net deferred income tax liability		$      2,224,722	$   2,074,704
Deferred tax assets and liabilities are reflected in the following
	captions on the consolidated balance sheet:
		Deferred income taxes		$      2,458,018	$   2,220,677
		Income taxes and other current assets		(233,296)	(145,973)
			Net deferred income tax liability	$      2,224,722	$   2,074,704

Provision (Benefit) for Income Taxes

The provision (benefit) for Federal and state income taxes, as well as the taxes charged or credited to shareholders' equity of Frontier, includes amounts both payable currently and deferred for payment in future periods as indicated below:

($ in thousands)			2011	2010	2009
Income taxes charged to the consolidated statement of
	operations:
Current:
	Federal		$          (13,320)	$        18,302	$        11,618
	State		14,252	10,260	(2,630)
		Total current	932	28,562	8,988
Deferred:
	Federal		77,750	82,080	49,916
	State		9,661	4,357	11,024
		Total deferred	87,411	86,437	60,940
Total income taxes charged to the consolidated statement of			88,343	114,999	69,928
		operations
Income taxes charged (credited) to shareholders' equity of Frontier:
Current benefit arising from stock options exercised and restricted stock			-	-	881
Deferred income taxes (benefits) arising from the recognition of
	additional pension/OPEB liability		(97,409)	17,501	(4,353)
Total income taxes charged (credited) to shareholders' equity of Frontier			(97,409)	17,501	(3,472)
Total income taxes			$            (9,066)	$      132,500	$        66,456

Changes in the Balance of Unrecognized Tax Benefits

The following table sets forth the changes in the Company's balance of unrecognized tax benefits for the years ended December 31, 2011 and 2010:

	($ in thousands)
		2011	2010
Unrecognized tax benefits - beginning of year		$           49,180	$        56,860
Gross decreases - prior year tax positions		-	(5,442)
Gross increases - current year tax positions		8,200	1,216
Gross decreases - expired statute of limitations		(23,452)	(3,454)
Unrecognized tax benefits - end of year		$           33,928	$        49,180