INCOME TAXES (Tables)

12 Months Ended

Jan. 02, 2016

Income Tax Disclosure [Abstract]

Significant Components of Deferred Tax Assets and Liabilities

Significant components of the Company’s deferred tax assets and liabilities at the end of each fiscal year were as follows:

(Millions of Dollars)	2015		2014
Deferred tax liabilities:
Depreciation	$	99.6	$	72.7
Amortization of intangibles	868.5		888.3
Liability on undistributed foreign earnings	319.9		369.2
Discharge of indebtedness	9.3		12.4
Inventories	—		8.8
Deferred revenue	25.5		32.0
Other	66.8		59.4
Total deferred tax liabilities	$	1,389.6	$	1,442.8
Deferred tax assets:
Employee benefit plans	$	361.1	$	308.3
Doubtful accounts and other customer allowances	19.0		15.0
Inventories	16.1		—
Accruals	135.6		131.7
Restructuring charges	12.6		42.2
Operating loss, capital loss and tax credit carryforwards	562.5		594.6
Currency and derivatives	42.2		47.3
Other	82.7		97.1
Total deferred tax assets	$	1,231.8	$	1,236.2
Net Deferred Tax Liabilities before Valuation Allowance	$	157.8	$	206.6
Valuation allowance	$	480.7	$	551.9
Net Deferred Tax Liabilities after Valuation Allowance	$	638.5	$	758.5

Classification of Deferred Taxes

The classification of deferred taxes as of January 2, 2016 and January 3, 2015 is as follows:

	2015					2014
(Millions of Dollars)	Deferred Tax Asset			Deferred Tax  Liability		Deferred Tax Asset			Deferred Tax  Liability
Current	$	(85.4	)	$	18.5	$	(137.4	)	$	11.9
Non-current	(120.5		)	825.9		(108.7		)	992.7
Total	$	(205.9	)	$	844.4	$	(246.1	)	$	1,004.6

Income Tax Expense (Benefit) Attributable to Continuing Operations

Income tax expense (benefit) attributable to continuing operations consisted of the following:

(Millions of Dollars)	2015			2014			2013
Current:
Federal	$	64.4		$	18.4		$	84.0
Foreign	171.4			141.1			123.5
State	14.1			17.1			(3.0		)
Total current	$	249.9		$	176.6		$	204.5
Deferred:
Federal	$	64.2		$	55.3		$	(77.1	)
Foreign	(47.3		)	(19.3		)	(50.6		)
State	(18.2		)	14.5			(8.2		)
Total deferred	(1.3		)	50.5			(135.9		)
Income taxes on continuing operations	$	248.6		$	227.1		$	68.6

Reconciliation of U.S. Federal Statutory Income Tax to Income Taxes on Continuing Operations

The reconciliation of the U.S. federal statutory income tax provision to the income taxes provision on continuing operations is as follows:

(Millions of Dollars)	2015			2014			2013
Tax at statutory rate	$	402.9		$	379.7		$	205.8
State income taxes, net of federal benefits	14.9			24.3			(6.6		)
Difference between foreign and federal income tax	(166.9		)	(178.0		)	(124.9		)
Tax accrual reserve	43.9			1.1			15.3
Audit settlements	1.3			(5.3		)	0.9
NOL/capital loss & valuation allowance related items	(21.6		)	2.7			6.8
Foreign dividends and related items	19.1			25.6			(9.5		)
Change in deferred tax liabilities on undistributed foreign earnings	(31.0		)	(6.0		)	(19.5		)
Statutory income tax rate change	4.8			(0.6		)	(1.7		)
Other-net	(18.8		)	(16.4		)	2.0
Income taxes on continuing operations	$	248.6		$	227.1		$	68.6

Components of Earnings from Continuing Operations Before Income Taxes

The components of earnings from continuing operations before income taxes consisted of the following:

(Millions of Dollars)	2015		2014		2013
United States	$	405.5	$	234.4	$	112.7
Foreign	745.3		850.4		474.9
Earnings from continuing operations before income taxes	$	1,150.8	$	1,084.8	$	587.6

Activity Related to Unrecognized Tax Benefits

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

(Millions of Dollars)	2015			2014			2013
Balance at beginning of year	$	280.8		$	269.5		$	207.2
Additions based on tax positions related to current year	23.2			27.4			37.1
Additions based on tax positions related to prior years	24.3			40.1			46.9
Reductions based on tax positions related to prior years	(14.3		)	(30.9		)	(13.2		)
Settlements	(21.5		)	(5.9		)	7.7
Statute of limitations expirations	(9.4		)	(19.4		)	(16.2		)
Balance at end of year	$	283.1		$	280.8		$	269.5