Income Taxes

3 Months Ended

Jul. 27, 2011

Income Taxes [Abstract]

Income Taxes

(5)   Income Taxes

The total amount of gross unrecognized tax benefits for uncertain tax positions, including positions impacting only the timing of tax benefits, was $66.3 million and $70.7 million, on July 27, 2011 and April 27, 2011, respectively. The amounts of unrecognized tax benefits that, if recognized, would impact the effective tax rate were $53.5 million and $56.5 million, on July 27, 2011 and April 27, 2011, respectively. It is reasonably possible that the amount of unrecognized tax benefits will decrease by as much as $17.8 million in the next 12 months due to the expiration of statutes of limitations in various foreign jurisdictions along with the progression of federal, state, and foreign audits in process.

The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes. The total amounts of interest and penalties accrued at July 27, 2011 were $28.4 million and $20.6 million, respectively. The corresponding amounts of accrued interest and penalties at April 27, 2011 were $27.3 million and $21.1 million, respectively.

The provision for income taxes consists of provisions for federal, state and foreign income taxes. The Company operates in an international environment with significant operations in various locations outside the U.S. Accordingly, the consolidated income tax rate is a composite rate reflecting the earnings in various locations and the applicable tax rates. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world, including such major jurisdictions as Australia, Canada, Italy, the United Kingdom and the United States. The Company has substantially concluded all national income tax matters for years through Fiscal 2009 for the U.S., through Fiscal 2008 for the United Kingdom, through Fiscal 2007 for Italy, and through Fiscal 2006 for Australia and Canada.

The effective tax rate for the current quarter was 23.2% compared to 25.3% last year. The decrease in the effective tax rate is primarily the result of a statutory tax rate reduction in the United Kingdom that was enacted during the first quarter of Fiscal 2012.