Annual report pursuant to Section 13 and 15(d)

Income Taxes

v2.4.1.9
Income Taxes
12 Months Ended
Jan. 03, 2015
Income Taxes [Abstract]  
Income Taxes

NOTE E – INCOME TAXES 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense (benefit) included in income from net earnings consists of the following:

 

 

 

 

 

 

 

 

 

Year ended

 

 

2012

 

2013

 

2014

 

 

 

 

 

 

 

Current

 

 

 

 

 

 

Federal

 

$             27,779

 

$             26,233

 

$             22,362

State

 

1,141 

 

94 

 

1,056 

Foreign

 

4,051 

 

9,626 

 

16,265 

 

 

 

 

 

 

 

Total Current

 

32,971 

 

35,953 

 

39,683 

 

 

 

 

 

 

 

Deferred

 

 

 

 

 

 

Federal

 

(145)

 

5,507 

 

(1,096)

State

 

94 

 

(5)

 

(43)

Foreign

 

(927)

 

(3,898)

 

473 

 

 

 

 

 

 

 

Total Deferred

 

(978)

 

1,604 

 

(666)

 

 

 

 

 

 

 

 

 

$             31,993

 

$             37,557

 

$             39,017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The income tax provision, as reconciled to the tax computed at the federal statutory rate of 35% for 2012, 2013, and

2014, is as follows:

 

 

 

 

 

 

 

 

Year ended

 

 

2012

 

2013

 

2014

 

 

 

 

 

 

 

Federal income taxes at statutory rate

 

$             34,449

 

$             40,803

 

$             40,479

State income taxes, net of federal tax benefit

 

1,201 

 

102 

 

653 

Qualified production activities deduction

 

(2,651)

 

(1,700)

 

(887)

Foreign rate differential

 

(337)

 

(890)

 

(603)

All other, net

 

(669)

 

(758)

 

(625)

 

 

 

 

 

 

 

 

 

$             31,993

 

$             37,557

 

$             39,017

 

 

 

 

 

 

 

NOTE  E – INCOME TAXES – CONTINUED

 

 

 

 

 

 

 

 

 

 

 

 

The significant categories of deferred taxes are as follows:

 

 

December 28,

 

January 3,

 

 

2013

 

2015

Deferred tax assets

 

 

 

 

Inventory differences

 

$              3,111

 

$              3,024

Accruals not currently deductible

 

5,345 

 

4,427 

Equity-based compensation

 

2,779 

 

2,822 

Intangible assets

 

10,590 

 

10,107 

Net operating losses

 

530 

 

526 

Other

 

2,315 

 

4,543 

 

 

 

 

 

Gross deferred tax assets

 

24,670 

 

25,449 

Valuation allowance

 

(530)

 

(526)

 

 

 

 

 

Net deferred tax assets

 

24,140 

 

24,923 

 

 

 

 

 

Deferred tax liabilities

 

 

 

 

Depreciation/amortization

 

(5,323)

 

(6,171)

Accumulated other comprehensive income

 

(3,418)

 

(1,994)

Prepaid expenses

 

(1,370)

 

(1,431)

Intangible assets

 

(10,590)

 

(10,107)

Other

 

(5,268)

 

(5,473)

 

 

 

 

 

Gross deferred tax liabilities

 

(25,969)

 

(25,176)

 

 

 

 

 

Net deferred taxes

 

$            (1,829)

 

$               (253)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Components of deferred taxes, net on a jurisdiction basis are as follows:

 

 

 

 

 

 

 

 

 

December 28,

 

January 3,

 

 

2013

 

2015

 

 

 

 

 

Net current deferred tax assets

 

$              8,588

 

$              9,683

Net noncurrent deferred tax assets

 

5,519 

 

5,933 

Net current deferred tax liabilities

 

(5,070)

 

(5,268)

Net noncurrent deferred tax liabilities

 

(10,866)

 

(10,601)

 

 

 

 

 

Net deferred taxes

 

$            (1,829)

 

$               (253)

 

 

At January 3, 2015, the Company had foreign operating loss carry forwards of approximately $1,901.  If these operating losses are not used, a portion of them will begin to expire in 2017.  A valuation allowance of $526 has been placed on these foreign operating loss carry forwards.  The valuation allowance is determined using a more likely than not realization criteria and is based upon all available positive and negative evidence, including future reversals of temporary differences.  A future increase or decrease in the current valuation allowance is not expected to impact the income tax provision due to the Company’s ability to fully utilize foreign tax credits associated with taxable income in these jurisdictions.

NOTE  E – INCOME TAXES – CONTINUED

 

The Company has not recognized a deferred tax liability for the undistributed earnings of certain of its foreign operations that arose during 2014 and in prior years as the Company considers these earnings to be indefinitely reinvested. As of January 3, 2015, the undistributed earnings of these subsidiaries was $12,296The hypothetical repatriation of these earnings would result in a tax liability to the Company of approximately $1,537

 

The Company recognizes the impact of a tax position in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position.  As of December 28, 2013 and January 3, 2015, the Company had no significant unrecognized tax benefits.

 

From time to time, the Company is subject to federal, state, and foreign tax authority income tax examinations. The Company remains subject to income tax examinations for each of its open tax years, which extend back to 2011 under most circumstances.  Certain taxing jurisdictions may provide for additional open years depending upon their statutes or if an audit is on-going.