Income Taxes (Tables)

12 Months Ended

Oct. 31, 2013

Income Taxes

Provision for Income Taxes by Taxing Jurisdiction and by Significant Component

The provision for income taxes by taxing jurisdiction and by significant component consisted of the following (in millions of dollars):

	2013		2012			2011
Current:
U.S.:
Federal	$	174.6	$	173.6		$	66.5
State	6.8		10.1			14.4
Foreign	32.6		34.0			25.0
Total current	214.0		217.7			105.9
Deferred:
U.S.:
Federal	42.4		4.4			98.1
State	.8		1.6			2.8
Foreign	1.2		(5.9		)	2.4
Total deferred	44.4		.1			103.3
Provision for income taxes	$	258.4	$	217.8		$	209.2

Comparison of Statutory and Effective Income Tax Provision

A comparison of the statutory and effective income tax provision and reasons for related differences follows (in millions of dollars):

	2013			2012			2011
U.S. federal income tax provision at a statutory rate of 35 percent	$	254.0		$	209.7		$	200.1
Increase (decrease) resulting from:
Municipal lease income not taxable	(1.4		)	(1.5		)	(1.6		)
Tax rates on foreign earnings	(7.2		)	(6.3		)	(5.5		)
State and local income taxes, net of federal income tax benefit	4.9			7.6			11.2
Other — net	8.1			8.3			5.0
Provision for income taxes	$	258.4		$	217.8		$	209.2

Analysis of Deferred Income Tax Assets and Liabilities

Deferred income taxes arise because there are certain items that are treated differently for financial accounting than for income tax reporting purposes. An analysis of deferred income tax assets and liabilities at October 31 was as follows (in millions of dollars):

	2013					2012
	Deferred Tax Assets			Deferred Tax Liabilities		Deferred Tax Assets			Deferred Tax Liabilities
Lease transactions				$	406.2				$	345.6
Tax over book depreciation				2.9					2.0
Deferred retail note finance income				3.9					3.0
Allowance for credit losses	$	43.1				$	45.9
Unrealized gain/loss on derivatives	2.0					6.1
Accrual for retirement and other benefits	22.2					8.0
Federal taxes on deferred state tax deductions	12.6					12.2
Tax loss and tax credit carryforwards	5.4					3.9
Miscellaneous accruals and other	5.3					.2
Less valuation allowances	(.8		)			(.4		)
Deferred income tax assets and liabilities	$	89.8		$	413.0	$	75.9		$	350.6

Reconciliation of Total Amounts of Unrecognized Tax Benefits

A reconciliation of the total amounts of unrecognized tax benefits at October 31 was as follows (in millions of dollars):

	2013			2012			2011
Beginning of year balance	$	32.5		$	30.0		$	30.3
Increases to tax positions taken during the current year	11.8			12.0			10.6
Increases to tax positions taken during prior years	1.1			.8			5.9
Decreases to tax positions taken during prior years	(7.8		)	(6.6		)	(14.7		)
Decreases due to lapse of statute of limitations	(4.0		)	(3.6		)	(2.1		)
Settlements							(.1		)
Foreign exchange				(.1		)	.1
End of year balance	$	33.6		$	32.5		$	30.0