Income Taxes	6 Months Ended
Jun. 30, 2012
Income Taxes	Note 6. Income Taxes: At June 30, 2012, there were $65.2 million of unrecognized tax benefits recorded in Other liabilities and $2.6 million recorded in Other current liabilities. If these unrecognized tax benefits were recognized, the effective tax rate would be affected. For the six months ended June 30, 2012, the Company reversed interest and penalties of $(0.6) million. At June 30, 2012, the Company had accrued interest and penalties of $0.9 million classified in Other current liabilities and $11.8 million of interest and penalties classified in Other liabilities. We regularly repatriate a portion of current year earnings from non–U.S. subsidiaries. No provision is made for additional taxes on undistributed earnings of subsidiary companies that are intended and planned to be indefinitely invested in such subsidiaries to fund local operations and/or capital projects. The Company has ongoing income tax audits and legal proceedings which are at various stages of administrative or judicial review, of which the material items are discussed below. In addition, the Company has other ongoing tax audits and legal proceedings that relate to direct and indirect taxes, such as transfer pricing, value-added taxes, capital tax, sales and use and property taxes, which are discussed in Note 11. As of June 30, 2012, the most significant income tax disputes in which the Company was involved related to ongoing tax assessments and uncertain tax positions within its European operations. Specifically, the Company has been disputing various income tax assessments imposed by the Spanish tax authorities against the Company’s Spanish subsidiaries. As a result of a tax audit for the 2002-2003 fiscal years, the Spanish tax authorities challenged certain tax positions taken in the Spanish subsidiaries’ tax returns and imposed an assessment of Euro 21.8 million ($27.2 million), including estimated interest as of June 30, 2012. During the fourth quarter of 2011, as a result of a tax audit for the 2004-2006 fiscal years, the Spanish tax authorities issued a tax assessment of Euro 62.8 million ($78.3 million), including estimated interest as of June 30, 2012. This assessment challenged similar tax positions identified in the prior assessment. At June 30, 2012, the aggregate amount of assessments from the Spanish tax authorities for all claims arising from the challenged income tax positions were Euro 84.6 million ($105.5 million), including estimated interest. The Company has appealed each of these assessments with the National Appellate Court, or, with respect to the 2004-2006 assessment, at the administrative level. In order to proceed with these appeals, the Company is required to, and, as of June 30, 2012, has posted bank guarantees of Euro 83.1 million ($103.6 million). In January 2012, the Spanish tax authorities commenced an audit of the 2007-2010 income tax returns of the Company’s Spanish subsidiaries. The tax positions that have previously been challenged by the Spanish tax authorities were consistently taken in the Company’s Spanish subsidiaries’ tax returns from 2003 through the end of 2011. Consequently, the Company anticipated that it would receive an assessment for matters similar to those under appeal, for the fiscal years 2007-2011. In accordance with ASC 740 “Income Taxes,” the Company records liabilities for uncertain tax positions. At June 30, 2012, the Company had accrued liabilities for uncertain tax positions of $50.8 million in connection with the income tax positions taken by the Company’s Spanish subsidiaries from 2002 through 2011 (discussed above). As previously disclosed, on August 1, 2012, the Company reached an overall settlement with the Spanish tax authorities regarding the income tax deductions taken by its Spanish subsidiaries for the years 2004-2010. Pursuant to the settlement, the Company and the Spanish tax authorities agreed to settle all disputes and claims arising from the Company’s Spanish subsidiaries’ tax returns for the 2004-2010 fiscal years in exchange for an agreed-upon payment of Euro 86.0 million ($105.7 million), in the aggregate, before the end of 2012. The settlement agreement does not address the Spanish tax authorities’ challenges to similar tax deductions taken in the tax returns filed for the 2002-2003 fiscal years, as these were further along in the Spanish judicial process. The Company intends to continue to challenge these assessments. As a result of the settlement, however, the Company will increase, in the third quarter of 2012, its accrual for uncertain tax positions for 2002-2003 by $13.9 million. The settlement agreement also did not address the 2011 fiscal year as the Spanish subsidiaries’ 2011 tax return was filed in late July 2012 and has not yet been audited. However, based on the settlement reached for 2004-2010, the Company will also increase its accrual for uncertain tax positions covering the 2011 period. As a result of the settlement, the Company will record an after-tax charge in the third quarter of 2012 of $58.5 million including the tax settlement for 2004-2010 and the increase in its liability for uncertain tax positions for 2011, as described above. As previously discussed, in 2012, the Company realigned its business operations in Spain and the Netherlands. As part of the overall settlement, the Company and the Spanish tax authorities have also preliminarily agreed upon the key principles to be incorporated into an agreement that will establish the tax basis for the Company’s activities in Spain for 2012 and future years. The terms and conditions of the agreement are not expected to have a material impact on the Company’s effective tax rate for 2012. In addition to the above, the Company has also been a party to four dividend withholding tax controversies in Spain in which the Spanish tax authorities alleged that the Company’s Spanish subsidiaries underpaid withholding taxes during the 1995-2001 fiscal years. The Company had previously appealed each of these controversies. At June 30, 2012, the aggregate amount of these dividend withholding controversies was Euro 18.0 million ($22.4 million), including estimated interest, for which the Company is fully reserved. During the first six months of 2012, the Company received unfavorable decisions on the first three cases and recorded charges (including estimated interest) aggregating $14.2 million ($12.3 million after-tax), which are reflected in income taxes payable at June 30, 2012. As of June 30, 2012, the Company had posted bank guarantees of Euro 11.9 million ($14.8 million) in order to proceed with these appeals. The Company made payments of $7.1 million during the second quarter of 2012, and expects to pay the remainder of the amount due by the end of 2012. The fourth and final remaining appeal has not yet been heard by the Spanish Supreme Court. As of June 30, 2012, the Company’s liability for uncertain tax positions arising from the Spanish withholding tax controversies was $4.6 million in the aggregate. As of June 30, 2012, the Company’s aggregate provisions for uncertain tax positions, including interest and penalties, is $80.4 million, which includes $50.8 million associated with the tax deductions taken by our Spanish subsidiaries, $4.6 million associated with our Spanish dividend withholding tax controversies and the remainder associated with various other tax positions asserted in foreign jurisdictions, none of which is individually material. In addition, the Company has several other tax audits in process and has open tax years with various taxing jurisdictions that range primarily from 2002 to 2011. Based on currently available information, we do not believe the ultimate outcome of any of these tax audits and other tax positions related to open tax years, when finalized, will have a material impact on our financial position, reported results or liquidity. The effective tax rate for the three months ended June 30, 2012 was 27.7% compared with 27.4 % for the three months ended June 30, 2011. The 2011 second quarter included a $5.8 million write-off of deferred tax assets as a result of U.S. state law changes enacted during that quarter that was partially offset by several items, including provision adjustments on uncertain tax positions and a favorable mix in earnings and remittances. The 2012 second quarter includes a $4.7 million provision related to the second Spanish dividend withholding tax case and other provision adjustments on uncertain tax positions. The year-over-year increase also reflects the absence of an R&D tax credit in the U.S. during the second quarter of 2012. The effective tax rate for the six months ended June 30, 2012 was 27.2% compared with 27.3% for the six months ended June 30, 2011. The 2011 first six-month period included a $5.8 million write-off of deferred tax assets as a result of U.S. state law changes enacted during the second quarter of 2011 that was partially offset by several items, including adjustments on uncertain tax positions and a favorable mix in earnings and remittances. The 2012 first six-month period includes a $10.6 million benefit due to a corporate restructuring of certain of our foreign subsidiaries that was offset by $12.9 million of provisions related to the Spanish dividend withholding tax cases and other reserve adjustments on uncertain tax positions. The year-over-year decrease also reflects a lower cost of repatriation during the six months ended June 30, 2012.

Note 6. Income Taxes:

At June 30, 2012, there were $65.2 million of unrecognized tax benefits recorded in Other liabilities and $2.6 million recorded in Other current liabilities. If these unrecognized tax benefits were recognized, the effective tax rate would be affected.

For the six months ended June 30, 2012, the Company reversed interest and penalties of $(0.6) million. At June 30, 2012, the Company had accrued interest and penalties of $0.9 million classified in Other current liabilities and $11.8 million of interest and penalties classified in Other liabilities.

We regularly repatriate a portion of current year earnings from non–U.S. subsidiaries. No provision is made for additional taxes on undistributed earnings of subsidiary companies that are intended and planned to be indefinitely invested in such subsidiaries to fund local operations and/or capital projects.

The Company has ongoing income tax audits and legal proceedings which are at various stages of administrative or judicial review, of which the material items are discussed below. In addition, the Company has other ongoing tax audits and legal proceedings that relate to direct and indirect taxes, such as transfer pricing, value-added taxes, capital tax, sales and use and property taxes, which are discussed in Note 11.

As of June 30, 2012, the most significant income tax disputes in which the Company was involved related to ongoing tax assessments and uncertain tax positions within its European operations. Specifically, the Company has been disputing various income tax assessments imposed by the Spanish tax authorities against the Company’s Spanish subsidiaries. As a result of a tax audit for the 2002-2003 fiscal years, the Spanish tax authorities challenged certain tax positions taken in the Spanish subsidiaries’ tax returns and imposed an assessment of Euro 21.8 million ($27.2 million), including estimated interest as of June 30, 2012. During the fourth quarter of 2011, as a result of a tax audit for the 2004-2006 fiscal years, the Spanish tax authorities issued a tax assessment of Euro 62.8 million ($78.3 million), including estimated interest as of June 30, 2012. This assessment challenged similar tax positions identified in the prior assessment. At June 30, 2012, the aggregate amount of assessments from the Spanish tax authorities for all claims arising from the challenged income tax positions were Euro 84.6 million ($105.5 million), including estimated interest. The Company has appealed each of these assessments with the National Appellate Court, or, with respect to the 2004-2006 assessment, at the administrative level. In order to proceed with these appeals, the Company is required to, and, as of June 30, 2012, has posted bank guarantees of Euro 83.1 million ($103.6 million).

In January 2012, the Spanish tax authorities commenced an audit of the 2007-2010 income tax returns of the Company’s Spanish subsidiaries. The tax positions that have previously been challenged by the Spanish tax authorities were consistently taken in the Company’s Spanish subsidiaries’ tax returns from 2003 through the end of 2011. Consequently, the Company anticipated that it would receive an assessment for matters similar to those under appeal, for the fiscal years 2007-2011. In accordance with ASC 740 “Income Taxes,” the Company records liabilities for uncertain tax positions. At June 30, 2012, the Company had accrued liabilities for uncertain tax positions of $50.8 million in connection with the income tax positions taken by the Company’s Spanish subsidiaries from 2002 through 2011 (discussed above).

As previously disclosed, on August 1, 2012, the Company reached an overall settlement with the Spanish tax authorities regarding the income tax deductions taken by its Spanish subsidiaries for the years 2004-2010. Pursuant to the settlement, the Company and the Spanish tax authorities agreed to settle all disputes and claims arising from the Company’s Spanish subsidiaries’ tax returns for the 2004-2010 fiscal years in exchange for an agreed-upon payment of Euro 86.0 million ($105.7 million), in the aggregate, before the end of 2012.

The settlement agreement does not address the Spanish tax authorities’ challenges to similar tax deductions taken in the tax returns filed for the 2002-2003 fiscal years, as these were further along in the Spanish judicial process. The Company intends to continue to challenge these assessments. As a result of the settlement, however, the Company will increase, in the third quarter of 2012, its accrual for uncertain tax positions for 2002-2003 by $13.9 million. The settlement agreement also did not address the 2011 fiscal year as the Spanish subsidiaries’ 2011 tax return was filed in late July 2012 and has not yet been audited. However, based on the settlement reached for 2004-2010, the Company will also increase its accrual for uncertain tax positions covering the 2011 period.

As a result of the settlement, the Company will record an after-tax charge in the third quarter of 2012 of $58.5 million including the tax settlement for 2004-2010 and the increase in its liability for uncertain tax positions for 2011, as described above. As previously discussed, in 2012, the Company realigned its business operations in Spain and the Netherlands. As part of the overall settlement, the Company and the Spanish tax authorities have also preliminarily agreed upon the key principles to be incorporated into an agreement that will establish the tax basis for the Company’s activities in Spain for 2012 and future years. The terms and conditions of the agreement are not expected to have a material impact on the Company’s effective tax rate for 2012.

In addition to the above, the Company has also been a party to four dividend withholding tax controversies in Spain in which the Spanish tax authorities alleged that the Company’s Spanish subsidiaries underpaid withholding taxes during the 1995-2001 fiscal years. The Company had previously appealed each of these controversies. At June 30, 2012, the aggregate amount of these dividend withholding controversies was Euro 18.0 million ($22.4 million), including estimated interest, for which the Company is fully reserved. During the first six months of 2012, the Company received unfavorable decisions on the first three cases and recorded charges (including estimated interest) aggregating $14.2 million ($12.3 million after-tax), which are reflected in income taxes payable at June 30, 2012. As of June 30, 2012, the Company had posted bank guarantees of Euro 11.9 million ($14.8 million) in order to proceed with these appeals. The Company made payments of $7.1 million during the second quarter of 2012, and expects to pay the remainder of the amount due by the end of 2012. The fourth and final remaining appeal has not yet been heard by the Spanish Supreme Court. As of June 30, 2012, the Company’s liability for uncertain tax positions arising from the Spanish withholding tax controversies was $4.6 million in the aggregate.

As of June 30, 2012, the Company’s aggregate provisions for uncertain tax positions, including interest and penalties, is $80.4 million, which includes $50.8 million associated with the tax deductions taken by our Spanish subsidiaries, $4.6 million associated with our Spanish dividend withholding tax controversies and the remainder associated with various other tax positions asserted in foreign jurisdictions, none of which is individually material.

In addition, the Company has several other tax audits in process and has open tax years with various taxing jurisdictions that range primarily from 2002 to 2011. Based on currently available information, we do not believe the ultimate outcome of any of these tax audits and other tax positions related to open tax years, when finalized, will have a material impact on our financial position, reported results or liquidity.

The effective tax rate for the three months ended June 30, 2012 was 27.7% compared with 27.4 % for the three months ended June 30, 2011. The 2011 second quarter included a $5.8 million write-off of deferred tax assets as a result of U.S. state law changes enacted during that quarter that was partially offset by several items, including provision adjustments on uncertain tax positions and a favorable mix in earnings and remittances. The 2012 second quarter includes a $4.7 million provision related to the second Spanish dividend withholding tax case and other provision adjustments on uncertain tax positions. The year-over-year increase also reflects the absence of an R&D tax credit in the U.S. during the second quarter of 2012. The effective tax rate for the six months ended June 30, 2012 was 27.2% compared with 27.3% for the six months ended June 30, 2011. The 2011 first six-month period included a $5.8 million write-off of deferred tax assets as a result of U.S. state law changes enacted during the second quarter of 2011 that was partially offset by several items, including adjustments on uncertain tax positions and a favorable mix in earnings and remittances. The 2012 first six-month period includes a $10.6 million benefit due to a corporate restructuring of certain of our foreign subsidiaries that was offset by $12.9 million of provisions related to the Spanish dividend withholding tax cases and other reserve adjustments on uncertain tax positions. The year-over-year decrease also reflects a lower cost of repatriation during the six months ended June 30, 2012.