INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

Components of income (loss) before income taxes

The components of income before income taxes for the three years ended December 31, 2012 were as follows:



	Year Ended December 31,
	2012		2011		2010
U.S.	$	243,382	$	204,667	$	135,756
Non-U.S.	126,188		96,664		51,352
Total	$	369,570	$	301,331	$	187,108

Components of income tax expense (benefit)

The components of income tax expense (benefit) for the three years ended December 31, 2012 were as follows:



	Year Ended December 31,
	2012			2011		2010
Current:
Federal	$	72,809		$	42,510	$	30,642
Non-U.S.	33,510			19,970		15,532
State and local	8,172			6,699		4,337
	114,491			69,179		50,511
Deferred:
Federal	(1,673		)	12,140		6,802
Non-U.S.	(750		)	2,768		(2,640		)
State and local	286			231		225
	(2,137		)	15,139		4,387
Total	$	112,354		$	84,318	$	54,898

Differences between total income tax expense and the amount computed by applying the statutory federal income tax rate to income before income taxes

The differences between total income tax expense and the amount computed by applying the statutory federal income tax rate to income before income taxes for the three years ended December 31, 2012 were as follows:



	Year Ended December 31,
	2012			2011			2010
Statutory rate of 35% applied to pre-tax income	$	129,350		$	105,466		$	65,488
Effect of state and local income taxes, net of federal tax benefit	5,598			4,585			3,044
Taxes (less) more than the U.S. tax rate on non-U.S. earnings, including utilization of tax loss carry-forwards, losses with no benefit and changes in non-U.S. valuation allowance	(11,263		)	(13,637		)	(1,417		)
Manufacturing deduction	(6,287		)	(5,330		)	(3,900		)
U.S. tax cost (benefit) of foreign source income	(4,766		)	145			(3,282		)
Resolution and adjustments to uncertain tax positions	(1,493		)	(5,103		)	(3,204		)
Other	1,215			(1,808		)	(1,831		)
Total	$	112,354		$	84,318		$	54,898
Effective tax rate	30.40		%	27.98		%	29.34		%

Significant components of deferred tax assets and liabilities

Significant components of deferred tax assets and liabilities at December 31, 2012 and 2011, were as follows:



	December 31,
	2012			2011
Deferred tax assets:
Tax loss and credit carry-forwards	$	40,373		$	32,313
Inventory	1,328			3,639
Other accruals	14,981			15,653
Employee benefits	17,904			17,600
Pension obligations	82,903			79,371
Other	12,686			7,111
Deferred tax assets, gross	170,175			155,687
Valuation allowance	(38,799		)	(31,713		)
Deferred tax assets, net	131,376			123,974
Deferred tax liabilities:
Property, plant and equipment	41,380			40,806
Intangible assets	19,545			13,251
Inventory	5,783			2,973
Pension obligations	2,940			1,676
Other	8,769			9,685
Deferred tax liabilities	78,417			68,391
Total Deferred taxes	$	52,959		$	55,583

Summary of the activity related to unrecognized tax benefits

The following table summarizes the activity related to unrecognized tax benefits:



	2012			2011
Balance at January 1	$	26,656		$	38,393
Increase related to current year tax provisions	3,838			2,221
Increase related to prior years' tax positions	212			3,250
Increase related to acquisitions	1,274			—
Decrease related to settlements with taxing authorities	(940		)	(3,424		)
Resolution of and other decreases in prior years' tax liabilities	(5,964		)	(13,460		)
Other	179			(324		)
Balance at December 31	$	25,255		$	26,656

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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