Slide 1 Sample Disclosures from 2007 10-Qs and 10-Ks

Slide 1Slide 1

Sample Disclosures from 2007 10-Qs and 10-Ks

Slide 2Slide 2

Sample Disclosures: Tabular Reconciliations

The following tabular reconciliation from JP Morgan Chase’s 2007 10-K is typical: Unrecognized tax benefits Year ended December 31, 2007 (in millions) Balance at January 1, 2007

$ 4,67

7 Increases based on tax positions related to the current

period 434 Decreases based on tax positions related to the current

period (241 ) Increases based on tax positions related to prior periods 903 Decreases based on tax positions related to prior periods (791 ) Decreases related to settlements with taxing authorities (158 ) Decreases related to a lapse of applicable statute of

limitations (13 ) Balance at December 31, 2007 $ 4,811

Slide 3Slide 3

Sample Disclosures: Tabular Reconciliations

An Example of a Tabular Reconciliation with Extra Detail: Bristol Myers Squibb’s 2007 10-K

Dollars in Millions

Unrecognized Federal, State and Foreign Tax Benefits Interest Penalties

Unrecognized Income Tax Benefits,

Including Interest and Penalties

Deferred Income Tax

Benefits

Unrecognized Income Tax Benefits,

Including Interest and Penalties, Net of Deferred Income

Tax Benefits Total uncertain tax positions that, if

recognized, would impact the effective tax rate as of January 1, 2007 $ 898 $ 72 $ 22 $ 992 $ (56 ) $ 936

Add: Tax attributable to deferred tax items at January 1, 2007 242 — — 242 — 242

Balance, gross uncertain tax positions, January 1, 2007 1,140 72 22 1,234 (56 ) 1,178

Gross additions to tax positions related to current year 208 — 1 209 (3 ) 206

Gross reductions to tax positions related to current year (4 ) — — (4 ) — (4 )

Gross additions to tax positions related to prior years 193 79 6 278 (27 ) 251

Gross reductions to tax positions related to prior years (253 ) (20 ) (1 ) (274 ) 17 (257 )

Settlements (240 ) (54 ) (3 ) (297 ) 10 (287 ) Reductions to tax positions related to

lapse of statute (1 ) — (1 ) (2 ) — (2 ) Cumulative translation adjustment 15 4 3 22 — 22

Balance, gross uncertain tax positions, December 31, 2007 1,058 81 27 1,166 (59 ) 1,107

Less: Tax attributable to deferred tax items at December 31, 2007 (264 ) — — (264 ) — (264 )

Total uncertain tax positions that, if recognized, would impact the effective tax rate as of December 31, 2007 $ 794 $ 81 $ 27 $ 902 $ (59 ) $ 843

Slide 4Slide 4

Sample Disclosures: Paragraph 21(d) “Early Warning” Disclosures

• Occidental Petroleum. ``It is reasonably possible that Occidental's existing liabilities for uncertain tax benefits may increase or decrease within the next twelve months primarily due to the progression of audits in process or the expiration of statutes of limitation. Occidental cannot reasonably estimate a range of potential changes in such benefits due to the unresolved nature of the various audits.''

• JPMorgan Chase. “As JPMorgan Chase is presently under audit by a number of tax authorities, it is reasonably possible that unrecognized tax benefits could change significantly over the next 12 months. JPMorgan Chase does not expect that any such changes would have a material impact on its annual effective tax rate.”

• Boeing. “It is reasonably possible that within the next 12 months we and the IRS will resolve some of the matters presently under consideration at appeals for 1998-2003 which may increase or decrease unrecognized tax benefits for all open tax years. Settlement could increase earnings in an amount ranging from $0 to $130 based on current estimates. Audit outcomes and the timing of audit settlements are subject to significant uncertainty.”

• Bristol Myers Squibb. “The Company is currently under examination by a number of tax authorities, including all of the major tax jurisdictions listed in the table below, which have proposed adjustments to tax for issues such as transfer pricing, certain tax credits and the deductibility of certain expenses. The Company estimates that it is reasonably possible that the balance of unrecognized tax benefits as of December 31, 2007 will decrease in the range of approximately $175 million to $215 million in the next twelve months as a result of the anticipated effective settlement of certain tax audits for the jurisdictions listed below. Such settlements will involve the payment of additional taxes, the adjustment of certain deferred taxes and/or the recognition of tax benefits. The Company also anticipates that it is reasonably possible that new issues will be raised by tax authorities who may require increases to the balance of unrecognized tax benefits; however, an estimate of such increases cannot be made. The Company believes that it has adequately provided for all open tax years by tax jurisdiction under FIN No. 48.”

Note: These sample disclosures are intended to illustrate the range of publicly-available disclosures and NOT to infer their adequacy.

Slide 5Slide 5

Sample Disclosures: Paragraph 21(d) Expanded Disclosure (GE)

2007 (In millions) December 31 January 1 Unrecognized tax benefits $ 6,331 $ 6,806 Portion that, if recognized, would reduce tax expense and effective tax rate(a)

4,268 4,302

Accrued interest on unrecognized tax benefits 923 1,281 Accrued penalties on unrecognized tax benefits 77 121 Reasonably possible reduction to the balance of unrecognized tax

benefits in succeeding 12 months 0 – 1,500 0 – 1,900

Portion that, if recognized, would reduce tax expense and effective tax rate(a)

0 – 1,250 0 – 900

(a) Some portion of such reduction might be reported as discontinued operations.

• General Electric 1st Qtr 10-Q. “During 2007, global audit resolutions could potentially reduce our unrecognized tax benefits, either because our tax positions are sustained on audit or because we agree to their disallowance, by as much as $1,900 million, depending on the outcomes of ongoing examinations and litigation. Of this amount, $1,000 million relates to positions that would not affect our total tax provision or effective tax rate.”

• 10-K: GE further expanded its 21(d) disclosure in its 2007 10-K:

…The IRS is currently auditing our consolidated U.S. income tax returns for 2003 – 2005. In addition, certain other U.S. tax deficiency issues and refund claims for previous years remain unresolved. It is reasonably possible that the 2003 – 2005 U.S. audit cycle will be completed during the next 12 months, which could result in a decrease in our balance of “unrecognized tax benefits” — that is, the aggregate tax effect of differences between tax return positions and the benefits recognized in our financial statements. We believe that there are no other jurisdictions in which the outcome of unresolved issues or claims is likely to be material to our results of operations, financial position or cash flows. We further believe that we have made adequate provision for all income tax uncertainties. The balance of unrecognized tax benefits, the amount of related interest and penalties we have provided and what we believe to be the range of reasonably possible changes in the next 12 months, were: