|6 Months Ended|
Jun. 30, 2017
|Income Tax Disclosure [Abstract]|
9. Income Taxes
The effective income tax rate for the three months ended June 30, 2017 and 2016 was 2.8% and 14.5%, respectively, resulting in a $345,000 and $136,000 income tax benefit, respectively. The effective income tax rate for the six months ended June 30, 2017 and 2016 was 5.9% and 20.9%, respectively, resulting in a $947,000 and $594,000 income tax benefit, respectively. The difference in the effective income tax rate for the three and six months ended June 30, 2017, compared to the three and six months ended June 30, 2016, is mainly attributable to the impairment charge recognized on NAPW’s goodwill and the change in the valuation allowance. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on the consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a valuation allowance as of June 30, 2017 and December 31, 2016.
The Company has not provided deferred income taxes on the undistributed earnings of its foreign subsidiaries. The amount of such earnings was insignificant. These earnings have been permanently reinvested and the Company does not plan to initiate action that would precipitate the payment of income taxes thereon. It is not practicable to estimate the amount of additional tax that might be payable on the undistributed earnings of its foreign subsidiaries.
No definition available.
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/presentationRef