Print Page  |  Close Window

SEC Filings

10-K
TERRAFORM GLOBAL, INC. filed this Form 10-K on 12/21/2016
Entire Document
 

which will occur as a result of such income or loss being subject to tax both in the foreign jurisdiction to which the entity relates as well as the U.S. The U.S. statutory rate, rather than the local foreign rate, is applied to this income or loss so that the impact of the rate differential between the U.S. statutory rate and the various foreign rates can be separately shown in the line item “Foreign rate differential”.    
The foreign taxes line item represents the future U.S. tax implications associated with foreign tax expense or benefit generated in each foreign jurisdiction. To the extent a foreign jurisdiction generates tax expense, that expense is generally expected to result in U.S. tax deductions in the future. To the extent a foreign jurisdiction recognizes a tax benefit, that benefit is generally expected to result in an increase to U.S. taxable income in the future.
As of December 31, 2015, the Company owns 65.1% of Global LLC and consolidates the results of Global LLC through its controlling interest. The Company records SunEdison’s 34.9% ownership of Global LLC as a non-controlling interest in the financial statements. Global LLC is treated as a partnership for income tax purposes. As such, the Company records income tax on its 65.1% of Global LLC’s taxable income and SunEdison records income tax on its 34.9% share of taxable income generated by Global LLC.
For the year ended December 31, 2015, the overall effective tax rate was different than the statutory rate of 35.0% primarily due to change in valuation allowances in our U.S. and foreign jurisdictions as well as non-allocable partnership losses. For the year ended December 31, 2015, the Company increased its valuation allowance by $252.2 million, of which $82.5 million dollars was recorded to continuing operations and $169.8 million was recorded to the balance sheet. As part of the IPO, the Company allocates taxes to its minority owner, of which $3.7 million was allocated for the year ended December 31, 2015.
Deferred Taxes
The tax effects of the major items recorded as deferred tax assets and liabilities are:
 
 
As of December 31,
(In thousands)
 
2015
 
2014
Deferred tax assets:
 
 
 
 
Net operating loss carryforwards
 
$
99,724

 
$
38,901

Asset retirement obligations
 
685

 
644

Deferred foreign taxes
 

 
940

Derivatives
 
16,464

 
3,452

Unrealized currency loss
 
822

 
164

Investment in Partnership
 
214,799

 

Other
 
1,892

 

Total deferred tax assets
 
334,386

 
44,101

Valuation allowance
 
(261,501
)
 
(9,265
)
Net deferred tax assets
 
72,885

 
34,836

 
 
 
 
 
Deferred tax liabilities:
 
 
 
 
Power plants
 
(64,967
)
 
(36,136
)
Intangible assets
 
(18,320
)
 

Derivatives
 

 

Capitalized Interest
 
(1,013
)
 

Unrealized currency gain/loss
 
(17,529
)
 
(1,384
)
Other
 

 

Total deferred tax liabilities
 
(101,829
)
 
(37,520
)
Valuation allowance
 

 

Net deferred tax liabilities
 
$
(28,944
)
 
$
(2,684
)
The Company regularly reviews its deferred tax assets for realizability, taking into consideration all available evidence, both positive and negative, including cumulative losses, projected future pre-tax and taxable income (losses), the


165