Taxes on Earnings (Tables)

12 Months Ended

Oct. 31, 2013

Taxes on Earnings

Schedule of domestic and foreign components of earnings (loss) before taxes

	2013		2012			2011
	In millions
U.S.	$	2,618	$	(3,192	)	$	3,039
Non-U.S.		3,892		(8,741	)		5,943
	$	6,510	$	(11,933	)	$	8,982

Schedule of provision for (benefit from) taxes on earnings

	2013			2012			2011
	In millions
U.S. federal taxes:
Current	$	475		$	330		$	390
Deferred		(666	)		81			(590	)
Non-U.S. taxes:
Current		1,275			1,139			1,177
Deferred		89			(787	)		611
State taxes:
Current		57			(41	)		141
Deferred		167			(5	)		179
	$	1,397		$	717		$	1,908

Schedule of differences between the U.S. federal statutory income tax rate and effective tax rate

	2013			2012(1)			2011
U.S. federal statutory income tax rate		35.0	%		35.0	%		35.0	%
State income taxes, net of federal tax benefit		0.1			0.5			0.5
Lower rates in other jurisdictions, net		(24.5	)		13.9			(23.3	)
Research and development credit		(0.7	)		0.1			(0.6	)
Valuation allowance		3.8			(14.0	)		5.2
Nondeductible goodwill		—			(40.3	)		3.4
Uncertain tax positions		4.1			(1.4	)		(1.1	)
Other, net		3.7			0.2			2.1
		21.5	%		(6.0	)%		21.2	%

⁽¹⁾

Positive numbers represent tax benefits and negative numbers represent tax expense as HP recorded income tax expense on a pretax loss.

Schedule of reconciliation of gross unrecognized tax benefits

	2013			2012			2011
	In millions
Balance at beginning of year	$	2,573		$	2,118		$	2,085
Increases:
For current year's tax positions		290			209			384
For prior years' tax positions		997			651			426
Decreases:
For prior years' tax positions		(146	)		(321	)		(159	)
Statute of limitations expiration		(11	)		(1	)		(20	)
Settlements with taxing authorities		(219	)		(83	)		(598	)
Balance at end of year	$	3,484		$	2,573		$	2,118

Schedule of significant components of deferred tax assets and deferred tax liabilities

	2013					2012
	Deferred Tax Assets			Deferred Tax Liabilities		Deferred Tax Assets			Deferred Tax Liabilities
	In millions
Loss carryforwards	$	9,807		$	—	$	9,142		$	—
Credit carryforwards		4,261			—		3,884			—
Unremitted earnings of foreign subsidiaries		—			7,469		—			7,559
Inventory valuation		128			13		185			12
Intercompany transactions—profit in inventory		125			—		463			—
Intercompany transactions—excluding inventory		1,923			—		881			—
Fixed assets		289			72		349			65
Warranty		622			—		663			—
Employee and retiree benefits		2,350			11		3,264			16
Accounts receivable allowance		185			1		161			2
Intangible assets		224			886		264			1,111
Restructuring		340			—		225			—
Deferred revenue		1,119			19		969			16
Other		1,443			759		1,107			367
Gross deferred tax assets and liabilities		22,816			9,230		21,557			9,148
Valuation allowance		(11,390	)		—		(10,223	)		—
Net deferred tax assets and liabilities	$	11,426		$	9,230	$	11,334		$	9,148

Schedule of current and long term deferred tax assets and liabilities

	2013			2012
	In millions
Current deferred tax assets	$	3,893		$	3,783
Current deferred tax liabilities		(375	)		(230	)
Long-term deferred tax assets		1,346			1,581
Long-term deferred tax liabilities		(2,668	)		(2,948	)
Net deferred tax assets net of deferred tax liabilities	$	2,196		$	2,186

Schedule of tax credit carryforwards

As of October 31, 2013, HP had recorded deferred tax assets for various tax credit carryforwards as follows:

	Carryforward		Valuation Allowance		Initial Year of Expiration
	In millions
U.S. foreign tax credits	$	3,200	$	47		2021
U.S. research and development and other credits		653		—		2018
Tax credits in state and foreign jurisdictions		408		239		2014
Balance at end of year	$	4,261	$	286

Schedule of valuation allowance balance

	2013			2012		2011
	In millions
Balance at beginning of year	$	10,223		$	9,057	$	8,755
Charged to expenses		1,644			865		315
Other comprehensive income, currency translation and other		(477	)		301		(13	)
Balance at end of year	$	11,390		$	10,223	$	9,057