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This excerpt taken from the MRVL 10-K filed Jul 2, 2007. Deferred Tax Asset for Stock
Based Compensation: The Company recorded adjustments for the creation of
additional deferred tax asset for stock based compensation that is deductible
at later periods for U.S. income tax purposes on its balance sheets for year
end dates of each of fiscal 2002 through fiscal 2006. As a result, additional
benefits for income tax arising from stock based compensation was recognized in
fiscal 2006 of $1.8 million, fiscal 2005 of $1.1 million, fiscal 2004 of $1.2
million, fiscal 2003 of $0.4 million and fiscal 2002 of $0.3 million. The total
gross stock based compensation cost that results in a deferred tax benefit is
$12.0 million of the total expense of $327.4 million.
In addition, the Company evaluated the impact of the restatement on its global tax provision. The Company and its subsidiaries file tax returns in multiple tax jurisdictions around the world. In the U.S. jurisdiction one of the company’s subsidiaries claims a tax deduction relative to stock options with regard to the U.S. distributor business. In accordance with FAS 123R for this jurisdiction where the deduction is claimed during fiscal 2007, the Company has recorded a deferred tax asset totaling $3.5 million at January 27, 2007, to reflect future tax deductions to the extent the company believes such asset is recoverable. |
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