Income Taxes (Tables)

12 Months Ended

Oct. 29, 2017

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):

	2017		2016		2015
Current:
U.S.:
Federal	$	50.0	$	(119.0)	$	119.1
State		3.1		4.4		5.4
Foreign		25.6		17.1		20.1
Total current		78.7		(97.5)		144.6
Deferred:
U.S.:
Federal		93.5		273.4		121.2
State		.3		(.7)		1.7
Foreign		(1.0)		5.1		2.4
Total deferred		92.8		277.8		125.3
Provision for income taxes	$	171.5	$	180.3	$	269.9

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):

	2017		2016		2015
U.S. federal income tax provision at a statutory rate of 35 percent	$	174.6	$	182.0	$	268.4
Increase (decrease) resulting from:
Tax rates on foreign earnings		(6.8)		(5.9)		(6.0)
Municipal lease income not taxable		(1.3)		(1.4)		(1.4)
State and local income taxes, net of federal income tax benefit		2.2		2.4		4.6
Other – net		2.8		3.2		4.3
Provision for income taxes	$	171.5	$	180.3	$	269.9

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 29, 2017 and October 30, 2016 was as follows (in millions of dollars):

	2017				2016
	Deferred		Deferred		Deferred		Deferred
	Tax		Tax		Tax		Tax
	Assets		Liabilities		Assets		Liabilities
Lease transactions			$	898.4			$	789.9
Tax over book depreciation				2.5				12.0
Deferred retail note finance income				4.6				5.4
Allowance for credit losses	$	54.5			$	53.6
Accrual for retirement and other benefits		29.9				26.3
Tax loss and tax credit carryforwards		29.5				20.8
Federal taxes on deferred state tax deductions		14.5				14.6
Miscellaneous accruals and other		1.7		2.3		8.3		.2
Less valuation allowances		(2.9)				(1.8)
Deferred income tax assets and liabilities	$	127.2	$	907.8	$	121.8	$	807.5

Reconciliation of Total Amounts of Unrecognized Tax Benefits

A reconciliation of the total amounts of unrecognized tax benefits at October 29, 2017, October 30, 2016, and November 1, 2015 was as follows (in millions of dollars):

	2017		2016		2015
Beginning of year balance	$	36.5	$	36.0	$	36.2
Increases to tax positions taken during the current year		7.6		9.7		11.1
Increases to tax positions taken during prior years		1.2		1.1		1.6
Decreases to tax positions taken during prior years		(5.9)		(7.3)		(7.8)
Decreases due to lapse of statute of limitations		(3.9)		(3.0)		(3.9)
Settlements						(1.1)
Foreign exchange						(.1)
End of year balance	$	35.5	$	36.5	$	36.0