INCOME TAXES (Tables)

12 Months Ended

Oct. 29, 2017

Provision for Income Taxes by Taxing Jurisdiction and by Significant Component

The provision for income taxes by taxing jurisdiction and by significant component consisted of the following in millions of dollars:


	2017		2016		2015
Current:
U.S.:
Federal	$	360	$	51	$	377
State		48		26		32
Foreign		463		340		449
Total current		871		417		858
Deferred:
U.S.:
Federal		59		297		21
State		7		11		4
Foreign		34		(25)		(43)
Total deferred		100		283		(18)
Provision for income taxes	$	971	$	700	$	840

Comparison of Statutory and Effective Income Tax Provision

A comparison of the statutory and effective income tax provision and reasons for related differences in millions of dollars follow:


	2017		2016		2015
U.S. federal income tax provision at a statutory rate of 35 percent	$	1,104	$	778	$	973
Increase (decrease) resulting from:
State and local income taxes, net of federal income tax benefit		35		26		23
Differences in taxability of foreign earnings		(83)		(107)		(449)
Nondeductible impairment charges				4
Research and business tax credits		(63)		(57)		(76)
Tax rates on foreign earnings		(86)		(27)		(36)
Valuation allowance on deferred taxes		89		79		384
Other-net		(25)		4		21
Provision for income taxes	$	971	$	700	$	840

Analysis of the Deferred Income Tax Assets and Liabilities

An analysis of the deferred income tax assets and liabilities at October 29, 2017 and October 30, 2016 in millions of dollars follows:


	2017				2016
	Deferred		Deferred		Deferred		Deferred
	Tax		Tax		Tax		Tax
	Assets		Liabilities		Assets		Liabilities
Other postretirement benefit liabilities	$	2,011			$	2,191
Lease transactions			$	933			$	817
Tax loss and tax credit carryforwards		677				661
Accrual for sales allowances		680				592
Tax over book depreciation				569				578
Pension liability - net		420				706
Foreign unrealized losses		7				472
Accrual for employee benefits		141				133
Share-based compensation		116				152
Goodwill and other intangible assets				130				89
Allowance for credit losses		107				88
Deferred compensation		59				50
Undistributed foreign earnings				21				30
Other items		432		172		471		175
Less valuation allowances		(620)				(1,029)
Deferred income tax assets and liabilities	$	4,030	$	1,825	$	4,487	$	1,689

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the total amounts of unrecognized tax benefits at October 29, 2017, October 30, 2016, and November 1, 2015 in millions of dollars follows:


	2017		2016		2015
Beginning of year balance	$	198	$	229	$	213
Increases to tax positions taken during the current year		35		14		32
Increases to tax positions taken during prior years		13		11		29
Decreases to tax positions taken during prior years		(17)		(36)		(15)
Decreases due to lapse of statute of limitations		(11)		(7)		(11)
Settlements		(1)		(5)		(6)
Foreign exchange		4		(8)		(13)
End of year balance	$	221	$	198	$	229