CNS AR24 Digital - Book - Page 53
regarding comparable rental and operating expense data, the capitalization or discount rate and projections of future rent and
expenses based on appropriate market evidence, and other subjective factors. Other methodologies that may also be used to
value a real property investment include, among other approaches, sales comparisons and cost approaches. We monitor the
real property investments for events that we believe could have a material impact on the most recent estimated fair values of
such real property investments.
Income Taxes
We operate globally through our subsidiaries and therefore must allocate our income, expenses, and earnings
considering various laws and regulations. Our tax provision represents an estimate of the total liability that we have incurred
as a result of our global operations. The determination of our annual provision is subject to judgments and estimates and the
actual results included in our annual tax returns may vary from the amounts reported in our consolidated financial statements.
Accordingly, we recognize additions to, or reductions from, income tax expense as our estimated liabilities are revised, actual
tax returns are filed and audits, if any, are settled. Such adjustments are recognized in the quarterly period in which they are
determined.
In addition, we record current and deferred tax consequences of all transactions that have been recognized in the
consolidated financial statements in accordance with the provisions of the enacted tax laws. Deferred tax assets are
recognized for temporary differences that will result in deductible amounts in future years at tax rates that are expected to
apply in those years. We record a valuation allowance, when necessary, to reduce deferred tax assets to an amount that more
likely than not will be realized. Deferred tax liabilities are recognized for temporary differences that will result in taxable
income in future years at tax rates that are expected to apply in those years.
The calculation of our tax liabilities involves uncertainties in the application of complex tax laws and regulations in
several jurisdictions across our global operations. In accordance with Accounting Standards Codification Topic 740, Income
Taxes (ASC 740), a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the
position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis
of the technical merits.
We record unrecognized tax benefits as liabilities in accordance with ASC 740 and adjust these liabilities when our
judgment changes as a result of the evaluation of new information not previously available. Because of the complexity of
these uncertainties, the ultimate resolution may differ from our current estimate of the unrecognized tax benefit liabilities.
These differences are reflected as increases or decreases in income tax expense in the period in which new information
becomes available.
Recently Issued Accounting Pronouncements
See discussion of Recently Issued Accounting Pronouncements in Note 2 of the consolidated financial statements.
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