Parker Wellbore Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Summary of Income (Loss) Before Income Taxes

Income (loss) before income taxes is summarized below:


	Year Ended December 31,
	2012		2011			2010
	(Dollars in Thousands)
United States	$	52,422	$	(61,434	)	$	1,865
Foreign		18,555		(3,978	)		9,640

	$	70,977	$	(65,412	)	$	11,505

Summary of Income Tax Expense (Benefit)

Income tax expense (benefit) is summarized as follows:


	Year Ended December 31,
	2012			2011			2010
	(Dollars in Thousands)
Current:
United States:
Federal	$	7,791		$	17,168		$	(273	)
State		733			1,264			184
Foreign		9,518			15,176			27,610
Deferred:
United States:
Federal		15,612			(46,694	)		(3,981	)
State		4,296			1,864			1,459
Foreign		(4,071	)		(3,545	)		1,214

	$	33,879		$	(14,767	)	$	26,213

Schedule of Income Tax Reconciliation from Federal Income Tax Statutory Rate

Total income tax expense differs from the amount computed by multiplying income before income taxes by the U.S. federal income tax statutory rate. The reasons for this difference are as follows:


	Year Ended December 31,
	2012						2011						2010
	(Dollars in thousands)
	Amount			% of Pre-Tax Income			Amount			% of Pre-Tax Income			Amount			% of Pre-Tax Income
Computed Expected Tax Expense	$	24,842			35	%	$	(22,894	)		35	%	$	4,027			35	%
Foreign Taxes		13,428			19	%		15,644			-24	%		18,951			165	%
Tax Effect Different From Statutory Rates		(8,080	)		-11	%		(1,571	)		2	%		(7,996	)		-70	%
State Taxes, net of federal benefit		4,757			7	%		2,689			-4	%		1,579			14	%
Foreign Tax Credits		(1,867	)		-3	%		(14,595	)		22	%		(15,442	)		-134	%
Kazakhstan Tax Settlement		—			0	%		(536	)		1	%		13,304			116	%
Mexico Tax Settlement		—			0	%		—			0	%		1,022			9	%
Change in Valuation Allowance		(1,662	)		-2	%		2,542			-4	%		506			4	%
Uncertain Tax Positions		(6,814	)		-10	%		1,348			-2	%		983			9	%
Permanent Differences		5,477			8	%		6,356			-10	%		6,003			52	%
Prior Year Return to Provision Adjustments		2,948			4	%		835			-1	%		1,775			15	%
Other		850			1	%		899			-1	%		1,501			13	%
Unremitted Foreign Earnings-Current Year Adjustment		—			0	%		(5,484	)		8	%		—			0	%

Actual Tax Expense	$	33,879			48	%	$	(14,767	)		22	%	$	26,213			228	%

Components of Deferred Tax Assets and Liabilities

The components of the Company’s deferred tax assets and liabilities as of December 31, 2012 and 2011 are shown below:


	December 31,
	2012			2011
	(Dollars in Thousands)
Deferred tax assets
Current deferred tax assets:
Reserves established against realization of certain assets	$	1,634		$	3,284
Accruals		6,747			3,065
Other		361			301

Gross current deferred tax assets		8,742			6,650
Valuation allowance		—			—

Current deferred tax assets		8,742			6,650

Non-current deferred tax assets:
Federal net operating loss carryforwards		—			361
State net operating loss carryforwards		3,095			6,393
Other state deferred tax asset, net		914			656
Foreign Tax Credits		25,977			28,146
Note Hedge Interest		—			1,318
Uncertain tax positions		8,015			8,188
Foreign tax		5,838			9,824
Impairment of long-lived assets		56,190			59,500
Other		71			392

Gross long-term deferred tax assets		100,100			114,778
Valuation Allowance		(4,805	)		(6,467	)

Non-current deferred tax assets, net of valuation allowance		95,295			108,311

Net deferred tax assets		104,037			114,961

Deferred tax liabilities:
Non-current deferred tax liabilities:
Property, Plant and equipment		(19,139	)		(8,986	)
Accruals		(1,066	)		—
Foreign tax		—			(6,379	)
Convertible Debt		—			(31	)
Deferred compensation		2,001			1,243
Other state deferred tax liability, net		(2,643	)
Other		—			(630	)

Gross non-current deferred tax liabilities		(20,847	)		(15,934	)

Net deferred tax asset	$	83,190		$	99,027

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:


	In Thousands
Balance at January 1, 2012	$	(15,492	)
Additions based on tax positions taken during a prior period		(1,495	)
Reductions based on tax positions taken during a prior period		4,102
Reductions related to a lapse of applicable statute of limitations		2,855

Balance at December 31, 2012	$	(10,030	)

Open Tax Years by Major Tax Jurisdiction

In many cases, our uncertain tax positions are related to tax years that remain subject to examination by tax authorities. The following describes the open tax years, by major tax jurisdiction, as of December 31, 2012:


Colombia			2008-present
Kazakhstan			2007-present
Mexico			2007-present
Papua New Guinea			2010-present
Russia			2009-present
United States — Federal			2011-present