NOTE 6 - Income Taxes

The provision (benefit) for income taxes, relating to continuing operations, consists of the following:

       
    2001  
  Current:    
       Federal $(23,353)  
       State and local (996)  
    (24,349)  
  Deferred (10,635)  
       Total $(34,984)  
       
     
2000 1999  
     
$ l.714 $16,067  
427 2,857  
2,l41 18,924  
(19,655) 14,873  
$(17,514) $33,797  
     

The significant components of the deferred tax expense (benefit) are as follows:

       
    2001  
  Depreciation $(11,085)  
  Goodwill impairment 1,615  
  Restructuring (2,692)  
  Pension 5,570  
  Inventories 752  
  State and local income tax benefit (2,165)  
  Federal tax credit (1,555)  
  Compensation and benefits 399  
  Accounts and noces receivable (1,858)  
  Retiree health care benefits 779  
  Litigation 484  
  Other (879)  
       Total $(10,635)  
       
     
2000 1999  
$ 3,929 $ 4,114  
(19,379) ---  
(3,471) ---  
3,087 5,775  
44 459  
--- ---  
--- ---  
(2,544) (483)  
(1,112) 4,236  
550 359  
(805) ---  
46 413  
$(19,655) $14,873  
     

The components of the current net deferred tax asset and long-term net deferred tax liability are as follows:

       
 
  		DECEMBER 30,
2001		  
  Deferred tax asset:    
       Allowance for doubtful accounts $ 3,660  
       Inventories 2,275  
       State and local income tax benefit 2,165  
       Federal tax credit 1,555  
       Compensation and benefits 11,279  
       Restructuring 6,163  
       Litigation 321  
       Other 891  
            Total current asset $ 28,309  
       
  Deferred tax liability:    
       Depreciation $ 19,079  
       Notes receivable (710)  
       Goodwill impairment (17,764)  
       Pension 44,327  
       Retiree health care benefits (20,480)  
       Interest rate swap (3,420)  
       Other (57)  
            Total long-term liability $ 20,975  
       
   
December 31,
2000 		 
   
$ 2,512  
3,027  
---  
---  
11,678  
3,471  
805  
280  
$ 21,773  
   
   
$ 30,164  
---  
(19,379)  
38,890  
(21,259)  
---  
211  
$ 28,627  
   

The reconciliation of the statutory federal income tax rate and the effective tax rate follows:

       
    2001  
  Statutory federal income tax race (35.0)%  
  State and local income taxes (5.3)  
  Capital loss ---  
  Utilization of capital loss carryover (1.5)  
  Other 0.3  
       Effective tax rate (41.5)%  
       
     
2000 1999
(35.0)% 35.0%  
(5.3) 5.3  
1.8 ---  
--- (2.3)  
1.0 (0.3)  
(37,5)% 37,7%  
     



Standard Register                          
2001 Annual Report