Annual report pursuant to Section 13 and 15(d)

Income Taxes Income Taxes (Tables)

v3.5.0.2
Income Taxes Income Taxes (Tables)
12 Months Ended
Sep. 30, 2016
Income Tax Disclosure [Abstract]  
Schedule of Components of the Provision (Benefit) for Income Taxes
 
Year Ended September 30,
 
2016
 
2015
 
2014
 
(dollars in thousands)
Domestic
$
2,100

 
$
94

 
$
278

Foreign
(7,550
)
 
(4,901
)
 
(13,327
)
 
$
(5,450
)
 
$
(4,807
)
 
$
(13,049
)


The components of the provision (benefit) for income taxes are as follows:

 
Year Ended September 30,
 
2016
 
2015
 
2014
 
(dollars in thousands)
Current:
 
 
 
 
 
Domestic Federal
$
530

 
$
(320
)
 
$
370

Foreign
500

 
500

 
530

Foreign withholding taxes
280

 
1,240

 

Domestic state
110

 

 
80

Total current
1,420

 
1,420

 
980

 
 
 
 
 
 
Deferred:
 
 
 
 
 
Domestic Federal
1,680

 
720

 
(490
)
Foreign

 
(210
)
 
750

Domestic state

 
(20
)
 

Total deferred
1,680

 
490

 
260

Total provision
$
3,100

 
$
1,910

 
$
1,240

Reconciliation of Actual Income Taxes to Expected Federal Corporate Income Taxes
A reconciliation of actual income taxes to income taxes at the expected United States federal corporate income tax rate of thirty-four percent is as follows:
 
Year Ended September 30,
 
2016
 
2015
 
2014
 
(dollars in thousands)
Tax benefit at the U.S. rate
$
(1,890
)
 
$
(1,630
)
 
$
(4,440
)
Effect of permanent book-tax differences
1,120

 
(1,570
)
 
30

State tax provision
110

 
(40
)
 
80

Valuation allowance for net deferred tax assets
2,690

 
2,490

 
3,900

Uncertain tax items
350

 
330

 
370

Foreign tax rate differential
1,050

 
1,890

 
1,000

Other items
(330
)
 
440

 
300

 
$
3,100

 
$
1,910

 
$
1,240

Schedule of Deferred Tax Assets and Deferred Tax Liability
The tax effects of temporary book-tax differences that give rise to significant portions of the deferred tax assets and deferred tax liability are as follows:
 
Year Ended September 30,
 
2016
 
2015
 
2014
 
(dollars in thousands)
Deferred tax assets - current:
 
 
 
 
 
Capitalized inventory costs
$
270

 
$
340

 
$
230

Inventory write-downs
2,460

 
4,840

 
950

Accrued warranty
160

 
280

 
180

Deferred profits
1,180

 
1,180

 
1,460

Accruals and reserves not currently deductible
1,720

 
1,920

 
520

Deferred tax assets - current
$
5,790

 
$
8,560

 
$
3,340

Valuation allowance
(5,790
)
 
(6,510
)
 
(2,280
)
Deferred tax assets - current, net of valuation allowance
$

 
$
2,050

 
$
1,060

 
 
 
 
 
 
Deferred tax assets (liabilities)- non-current:
 
 
 
 
 
Stock option expense
$
890

 
$
680

 
$
670

Book vs. tax basis of acquired assets
(1,340
)
 
(1,350
)
 
(1,210
)
Federal net operating loss carryforwards
3,370

 
5,570

 
900

Foreign and state net operating losses
13,200

 
10,550

 
8,070

Book vs. tax depreciation and amortization
(2,200
)
 
(2,030
)
 
(10
)
Foreign tax credits
4,230

 
3,950

 

Other deferred tax assets
570

 
360

 
2,950

Total deferred tax assets - non-current
18,720

 
17,730

 
11,370

Valuation allowance
(18,520
)
 
(17,300
)
 
(10,070
)
Deferred tax assets (liabilities) - non-current, net of valuation allowance
$
200

 
$
430

 
$
1,300

Changes in Deferred Tax Valuation Allowance
Changes in the deferred tax valuation allowance are as follows:
 
 
Year Ended September 30,
 
2016
 
2015
 
2014
 
(dollars in thousands)
Balance at the beginning of the year
$
23,810

 
$
12,350

 
$
8,450

Additions to valuation allowance
500

 
11,460

 
3,900

Balance at the end of the year
$
24,310

 
$
23,810

 
$
12,350

Schedule of Unrecognized Tax Benefit Liabilities
A reconciliation of the beginning and ending amount of our unrecognized tax benefits is summarized as follows:
 
 
Year Ended September 30,
 
2016
 
2015
 
2014
 
(dollars in thousands)
Balance at beginning of the year
$
3,510

 
$
3,180

 
$
2,810

Additions related to tax positions taken in prior years
350

 
330

 
370

Reductions due to lapse of statute of limitations

 

 

Balance at the end of the year
$
3,860

 
$
3,510

 
$
3,180