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Select a company that is publicly listed on a U.S. stock exchange and that is of personal interest to you. Access its latest Annual Report on Form 10K and attach a copy of that latest Annual Report to
Select a company that is publicly listed on a U.S. stock exchange and that is of personal interest to you. Access its latest Annual Report on Form 10K and attach a copy of that latest Annual Report to your initial response. Using CTRL F on your personal computer or Command F on Mac, do a search of that latest Annual Report and locate any information contained in that latest Annual Report related to:
- Transfer pricing and/or tax havens
- From the Business Section of the Annual Report on Form 10K, find any information or disclosures made by management related to income taxes
- From the Summary of Accounting Policies, any income tax policies related to the accounting for income taxes
- From the footnotes to the financial statements, the income tax footnote, and
- In management’s Discussion and Analysis section of the Annual Report on 10K, find any information or disclosures related to income taxes made by management
Ensure you select a company that none of your peers has selected (Exxon Mobil)
Address in your initial response what you learned from the above search about your chosen company that relates to what we are learning in this Module about international taxation-related Issues. In preparing your response, number your answers to items 1-5 inclusive above so that you are sure to answer each point in your initial response.
Finally, would you say that your chosen company has been tax conservative or tax aggressive or something in between regarding the management of income tax expense? For example, the basic corporate income tax rate as of December 2016 is 35% for U.S. corporations; what is the effective income tax rate of your chosen company in its latest Annual Report? (Hint: take income tax expense on the income statement divided by income before income taxes to obtain the overall effective income tax rate.) What has been the trend in that effective income tax rate over the last three fiscal years compared to the 35% basic corporate tax rate? Does that change your answer to the tax “conservative or aggressive” question for your chosen company?
