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SEC Filings

10-K
CINEMARK HOLDINGS, INC. filed this Form 10-K on 02/27/2015
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Table of Contents

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In thousands, except share and per share data

 

Uncertain Tax Positions

The following is a reconciliation of the total amounts of unrecognized tax benefits excluding interest and penalties, for the years ended December 31, 2012, 2013 and 2014:

 

     Year Ended December 31,  
     2012      2013      2014  

Balance at January 1,

   $ 18,660       $ 33,222       $ 18,780   

Gross increases — tax positions in prior periods

     14,462         413         10   

Gross decreases — tax positions in prior periods

     (3,321      —           (2,379

Gross increases — current period tax positions

     3,672         1,476         1,324   

Gross decreases — current period tax positions

     —           —           —     

Settlements

     —           (15,444      (963

Foreign currency translation adjustments

     (251      (887      (257
  

 

 

    

 

 

    

 

 

 

Balance at December 31,

   $ 33,222       $ 18,780       $ 16,515   
  

 

 

    

 

 

    

 

 

 

The Company had $20,130 and $15,693 of unrecognized tax benefits, including interest and penalties, as of December 31, 2013 and 2014, respectively. Of these amounts, $17,909 and $15,693 represent the amount of unrecognized tax benefits that if recognized would impact the effective income tax rate for the years ended December 31, 2013 and 2014, respectively. The Company had $4,671 and $2,500 accrued for interest and penalties as of December 31, 2013 and 2014, respectively.

The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and in certain state and foreign jurisdictions and are routinely under audit by many different tax authorities. The Company believes that its accrual for tax liabilities is adequate for all open audit years based on its assessment of many factors including past experience and interpretations of tax law. This assessment relies on estimates and assumptions and may involve a series of complex judgments about future events. The Company is no longer subject to income tax audits from the Internal Revenue Service for years before 2011. The Company is no longer subject to state income tax examinations by tax authorities in its major state jurisdictions for years before 2011. Certain state returns were amended as a result of the Internal Revenue Service examination closures for 2007 through 2009, and the statutes remain open for those amendments. The Company is no longer subject to non-U.S. income tax examinations by tax authorities in its major non-U.S. tax jurisdictions for years before 2004.

The Company is currently under audit in the non-U.S. tax jurisdictions of Brazil and Chile. The Company believes that it is reasonably possible that the Chile audit will be completed within the next twelve months.

 

19. COMMITMENTS AND CONTINGENCIES

Leases —   The Company conducts a significant part of its theatre operations in leased properties under noncancelable operating and capital leases with terms generally ranging from 10 to 25 years. In addition to the minimum annual lease payments, some of the leases provide for contingent rentals based on operating results of the theatre and most require the payment of taxes, insurance and other costs applicable to the property. The Company can renew, at its option, a substantial portion of the leases at defined or then market rental rates for various periods. Some leases also provide for escalating rent payments throughout the lease term. A liability for deferred lease expenses of $43,552 and $46,003 at December 31, 2013 and 2014, respectively, has been provided

 

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