Income Taxes (Tables)

12 Months Ended

Sep. 30, 2015

Schedule of U.S. and non-U.S. components of income before income tax expense/(benefit)

The Company’s income before taxes by fiscal year consisted of the following:



	2015		2014		2013
	(in millions)
U.S.	$	7,214	$	6,140	$	5,992
Non-U.S.	1,781		1,584		1,265
Total income before taxes	$	8,995	$	7,724	$	7,257

Comprehensive Income Tax (Expense) Benefit Components Table

Income tax provision by fiscal year consisted of the following:



	2015		2014			2013
	(in millions)
Current:
U.S. federal	$	1,991	$	2,353		$	568
State and local	168		237			(58		)
Non-U.S.	300		274			239
Total current taxes	2,459		2,864			749
Deferred:
U.S. federal	181		(576		)	1,401
State and local	1		(31		)	114
Non-U.S.	26		29			13
Total deferred taxes	208		(578		)	1,528
Total income tax provision	$	2,667	$	2,286		$	2,277

Components of Deferred Tax Assets and Liabilities

The tax effect of temporary differences that give rise to significant portions of deferred tax assets and liabilities at September 30, 2015 and 2014, are presented below:



	2015			2014
	(in millions)
Deferred Tax Assets:
Accrued compensation and benefits	$	141		$	134
Comprehensive (income) loss	51			14
Investments in joint ventures	20			14
Accrued litigation obligation	391			558
Client incentives	191			235
Net operating loss carryforward	50			35
Tax credits	1			21
Federal benefit of state taxes	203			210
Other	164			139
Valuation allowance	(40		)	(34		)
Deferred tax assets	1,172			1,326
Deferred Tax Liabilities:
Property, equipment and technology, net	(315		)	(298		)
Intangible assets	(3,964		)	(4,000		)
Foreign taxes	(153		)	(125		)
Other	—			(12		)
Deferred tax liabilities	(4,432		)	(4,435		)
Net deferred tax liabilities	$	(3,260	)	$	(3,109	)

Deferred Tax Assets and Liabilities

Total net deferred tax assets and liabilities are included in the Company’s consolidated balance sheets as follows:



	September 30, 2015			September 30, 2014
	(in millions)
Current deferred tax assets	$	871		$	1,028
Non-current deferred tax assets⁽¹⁾	11			8
Current deferred tax liabilities⁽¹⁾	(19		)	—
Non-current deferred tax liabilities	(4,123		)	(4,145		)
Net deferred tax liabilities	$	(3,260	)	$	(3,109	)


⁽¹⁾	Non-current deferred tax assets are reflected in other assets and current deferred tax liabilities are reflected in accrued liabilities on the consolidated balance sheets.

Reconciliation of the US Statutory Federal Tax Rate

The income tax provision differs from the amount of income tax determined by applying the applicable U.S. federal statutory rate of 35% to pretax income, as a result of the following:



	For the Years Ended September 30,
	2015					2014					2013
	Dollars			Percent		Dollars			Percent		Dollars			Percent
	(in millions, except percentages)
U.S. federal income tax at statutory rate	$	3,148		35	%	$	2,704		35	%	$	2,540		35	%
State income taxes, net of federal benefit	194			2	%	129			2	%	42			1	%
Non-U.S. tax effect, net of federal benefit	(327		)	(4	)%	(278		)	(4	)%	(328		)	(5	)%
Prior years U.S. domestic production activities deduction	—			—	%	(191		)	(2	)%	—			—	%
Reversal of prior years tax reserves related to the resolution of uncertain tax positions	(239		)	(2	)%	—			—	%	—			—	%
Other, net	(109		)	(1	)%	(78		)	(1	)%	23			—	%
Income tax provision	$	2,667		30	%	$	2,286		30	%	$	2,277		31	%

Unrecognized Tax Benefits Reconciliation, Table

A reconciliation of beginning and ending unrecognized tax benefits by fiscal year is as follows:



	2015			2014
	(in millions)
Beginning balance at October 1	$	1,303		$	1,023
Increases of unrecognized tax benefits related to prior years	44			139
Decreases of unrecognized tax benefits related to prior years	(413		)	(54		)
Increases of unrecognized tax benefits related to current year	120			199
Reductions related to lapsing statute of limitations	(3		)	(4		)
Ending balance at September 30	$	1,051		$	1,303