NOTES TO CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2003 and 2002, a valuation allowance for deferred tax assets of approximately $13.0 million and $12.5  million, respec- tively, was provided on the foreign tax credits and net operating losses of RGA Reinsurance, GA Argentina, RGA South Africa, and RGA UK. The Company utilizes valuation allowances when it cannot assume, based on the weight of the available evidence, that the deferred income taxes will be realized. The Company has not  66 THIS IS RGA. 2003 ANNUAL REPORT YEARS ENDED DECEMBER 31, 2003 2002 2001 Tax provision at U.S. statutory rate $ 95,064 $ 67,892 $ 23,153 Increase (decrease) in income taxes resulting from: Foreign tax rate differing from U.S. tax rate  (2,227) (124) (784) Settlement of IRS audit – (2,000) – Travel and entertainment 2 129 32 Intangible amortization – 199 65 Deferred tax valuation allowance  556 (211) 3,501 Other, net (104) (370) 282 Total provision for income taxes $ 93,291 $ 65,515 $ 26,249 YEARS ENDED DECEMBER 31, 2003 2002 2001 Income tax from continuing operations $ 93,291 $ 65,515 $ 26,249 Tax benefit on discontinued operations (3,082) (3,066) (3,691) Tax effect on cumulative change in accounting principle 293 – – Income tax from stockholders’ equity: Net unrealized holding gain on debt and equity securities recognized  for financial reporting purposes 36,637 51,591 21,320 Exercise of stock options (2,919) (1,943) (1,653) Foreign currency translation 28,477 (3,664) (5,266) Total income tax provided $152,697 $108,433 $ 36,959 YEARS ENDED DECEMBER 31, Deferred income tax assets: Nondeductible accruals $ 23,744 $ 21,120 Reserves for policies and investment income differences 140,049 86,602 Deferred acquisition costs capitalized for tax 40,711 33,561 Net operating loss carryforward 183,340 148,803 Foreign tax and AMT credit carryforward 12,394 9,494 Capital loss carryforward – 4,831 Subtotal 400,238 304,411 Valuation allowance (12,988) (12,458)  Total deferred income tax assets 387,250 291,953 Deferred income tax liabilities: Deferred acquisition costs capitalized for financial reporting 617,492 386,953 Differences between tax and financial reporting amounts  concerning certain reinsurance transactions 35,474 156,123 Differences in foreign currency translation 28,862 385 Differences in the tax basis of cash and invested assets 144,395 40,472 Total deferred income tax liabilities 826,223 583,933 Net deferred income tax liabilities $438,973 $291,980 The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and liabilitie at December 31, 2003 and 2002, are presented in the following tables (in thousands): Total income taxes were as follows (in thousands):