notes to consolidated financial statements note 11 . income taxes 2013 ( continued ) the federal income tax return for 2006 is subject to examination by the irs . in addition for 2007 and 2008 , the irs has invited the company to participate in the compliance assurance process ( 201ccap 201d ) , which is a voluntary program for a limited number of large corporations . under cap , the irs conducts a real-time audit and works contemporaneously with the company to resolve any issues prior to the filing of the tax return . the company has agreed to participate . the company believes this approach should reduce tax-related uncertainties , if any . the company and/or its subsidiaries also file income tax returns in various state , local and foreign jurisdictions . these returns , with few exceptions , are no longer subject to examination by the various taxing authorities before as discussed in note 1 , the company adopted the provisions of fin no . 48 , 201caccounting for uncertainty in income taxes , 201d on january 1 , 2007 . as a result of the implementation of fin no . 48 , the company recognized a decrease to beginning retained earnings on january 1 , 2007 of $ 37 million . the total amount of unrecognized tax benefits as of the date of adoption was approximately $ 70 million . included in the balance at january 1 , 2007 , were $ 51 million of tax positions that if recognized would affect the effective tax rate . a reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows : ( in millions ) .
what is the ratio of the decrease in the retained earnings to the to the beginning amount of unrecognized tax benefits in 2007
the company anticipates that it is reasonably possible that payments of approximately $ 2 million will be made primarily due to the conclusion of state income tax examinations within the next 12 months . additionally , certain state and foreign income tax returns will no longer be subject to examination and as a result , there is a reasonable possibility that the amount of unrecognized tax benefits will decrease by $ 7 million . at december 31 , 2007 , there were $ 42 million of tax benefits that if recognized would affect the effective rate . the company recognizes interest accrued related to : ( 1 ) unrecognized tax benefits in interest expense and ( 2 ) tax refund claims in other revenues on the consolidated statements of income . the company recognizes penalties in income tax expense ( benefit ) on the consolidated statements of income . during 2007 , the company recorded charges of approximately $ 4 million for interest expense and $ 2 million for penalties . provision has been made for the expected u.s . federal income tax liabilities applicable to undistributed earnings of subsidiaries , except for certain subsidiaries for which the company intends to invest the undistributed earnings indefinitely , or recover such undistributed earnings tax-free . at december 31 , 2007 , the company has not provided deferred taxes of $ 126 million , if sold through a taxable sale , on $ 361 million of undistributed earnings related to a domestic affiliate . the determination of the amount of the unrecognized deferred tax liability related to the undistributed earnings of foreign subsidiaries is not practicable . in connection with a non-recurring distribution of $ 850 million to diamond offshore from a foreign subsidiary , a portion of which consisted of earnings of the subsidiary that had not previously been subjected to u.s . federal income tax , diamond offshore recognized $ 59 million of u.s . federal income tax expense as a result of the distribution . it remains diamond offshore 2019s intention to indefinitely reinvest future earnings of the subsidiary to finance foreign activities . total income tax expense for the years ended december 31 , 2007 , 2006 and 2005 , was different than the amounts of $ 1601 million , $ 1557 million and $ 639 million , computed by applying the statutory u.s . federal income tax rate of 35% ( 35 % ) to income before income taxes and minority interest for each of the years. .