v3.23.2
Income Taxes (Tables)
 12 Months Ended
Jun. 30, 2023
Income Tax Disclosure [Abstract]  
Schedule of (Loss) Income from Continuing Operations Before Income Tax Expense (Benefit) Attributable to Jurisdictions
Income before income tax expense was attributable to the following jurisdictions:
For the fiscal years ended June 30,
202320222021
(in millions)
U.S.$74 $194 $266 
Foreign256 618 184 
Income before income tax expense$330 $812 $450 
Schedule of Components of Income Tax Expense (Benefit)
The significant components of the Company’s income tax expense were as follows:
For the fiscal years ended June 30,
202320222021
(in millions)
Current:
U.S.
Federal$1 $— $5 
State & Local15 9 9 
Foreign125 160 133 
Total current tax141 169 147 
Deferred:
U.S.
Federal(10)54 (30)
State & Local— 4 (1)
Foreign12 (175)(55)
Total deferred tax2 (117)(86)
Total income tax expense$143 $52 $61 
Effective Income Tax Rate Reconciliation
The reconciliation between the Company’s actual effective tax rate and the statutory U.S. Federal income tax rate was as follows:
For the fiscal years ended June 30,
202320222021
U.S. federal income tax rate21 %21 %21 %
State and local taxes, net4 1 2 
Effect of foreign operations (a)
15 7 12 
Change in valuation allowance (b)
1 (19)(16)
Non-deductible goodwill and asset impairments4 — 1 
Non-deductible compensation and benefits3 — 4 
Remeasurement of deferred tax assets (c)
— (2)(7)
R&D tax credits(3)(1)(2)
Impact of dispositions— (2)— 
Other(2)1 (1)
Effective tax rate43 %6 %14 %
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(a)The Company’s effective tax rate is impacted by the geographic mix of its pre-tax income. The Company’s foreign operations are located primarily in Australia and the United Kingdom (“U.K.”). Australia has a higher income tax rate than the U.S. and the U.K. has a lower tax rate than the U.S. through the fiscal year ended June 30, 2023.
(b)For the fiscal year ended June 30, 2022, the Company released valuation allowances of $156 million, including $149 million related to certain Foreign deferred tax assets. For the fiscal year ended June 30, 2021, the Company released $75 million of valuation allowances, including $64 million related to certain U.S. deferred tax assets.
(c)For the fiscal year ended June 30, 2022, the Company recorded a benefit of $18 million related to the remeasurement of its U.K. deferred tax assets. For the fiscal year ended June 30, 2021, the Company recorded a benefit of $34 million related to the remeasurement of its U.K. deferred tax assets which includes the enacted corporate income tax increase resulting from the Finance Act 2021.
Summary of Recognized Deferred Income Taxes in Balance Sheets
The Company recognized deferred income taxes in the Balance Sheets as follows:
As of June 30,
20232022
(in millions)
Deferred income tax assets
$393 $422 
Deferred income tax liabilities
(163)(198)
Net deferred tax assets$230 $224 
Schedule of Components of Deferred Tax Assets and Liabilities
The significant components of the Company’s deferred tax assets and liabilities were as follows:
As of June 30,
20232022
(in millions)
Deferred tax assets:
Accrued liabilities$150 $181 
Capital loss carryforwards1,163 1,135 
Net operating loss carryforwards360 408 
Business tax credits131 122 
Operating lease liabilities309 278 
Other138 116 
Total deferred tax assets2,251 2,240 
Deferred tax liabilities:
Asset basis difference and amortization(79)(163)
Operating lease right-of-use asset(287)(257)
Other(9)(8)
Total deferred tax liabilities(375)(428)
Net deferred tax asset before valuation allowance1,876 1,812 
Less: valuation allowance (See Note 22—Valuation and Qualifying Accounts)
(1,646)(1,588)
Net deferred tax assets$230 $224 
Schedule of Income Tax Net Operating Loss Carryforwards (NOLs) (Gross, Net Uncertain Tax Benefits)
As of June 30, 2023, the Company had income tax net operating loss (“NOL”) carryforwards (gross, net of uncertain tax benefits) in various jurisdictions as follows:
JurisdictionExpirationAmount
(in millions)
U.S. Federal2024 to 2037$116 
U.S. FederalIndefinite333 
U.S. StatesVarious730 
AustraliaIndefinite319 
U.K.Indefinite28 
Other ForeignVarious568 
Change in Unrecognized Tax Benefits, Excluding Interest and Penalties
The following table sets forth the change in the Company’s unrecognized tax benefits, excluding interest and penalties:
For the fiscal years ended June 30,
202320222021
(in millions)
Balance, beginning of period$86 $69 $63 
Additions for prior year tax positions14 — — 
Additions for current year tax positions17 28 4 
Reduction for prior year tax positions— (1)(2)
Lapse of the statute of limitations(2)(3)(3)
Settlement—tax attributes(14)— — 
Impact of currency translations4 (7)7 
Balance, end of period$105 $86 $69 
Summary of Major Tax Jurisdictions and Fiscal Years Open to Examination The following is a summary of major tax jurisdictions for which tax authorities may assert additional taxes based upon tax years currently under audit and subsequent years that could be audited by the respective taxing authorities.
JurisdictionFiscal Years Open to Examination
U.S. federal2018, 2020-2022
U.S. statesVarious
Australia2015-2022
U.K.2011-2022