XML 36 R23.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Income Taxes | 12 Months Ended
--- | ---
Sep. 30, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The provision for income taxes was as follows during fiscal 2022, 2021 and 2020:
| Year ended September 30,
| 2022 |  | 2021 |  | 2020
| (In thousands)
Current: |  |  |  |  |
Federal | $ | 50,403 |  |  | $ | 43,437 |  |  | $ | 14,566 |
State | 8,952 |  |  | 7,961 |  |  | 2,180 |
Foreign | 30,597 |  |  | 35,615 |  |  | 12,482 |
| 89,952 |  |  | 87,013 |  |  | 29,228 |
Deferred: |  |  |  |  |
Federal | 8,165 |  |  | (4,602) |  |  | (8,575) |
State | 507 |  |  | (948) |  |  | (957) |
Foreign | (856) |  |  | (405) |  |  | 893 |
| 7,816 |  |  | (5,955) |  |  | (8,639) |
Total provision | $ | 97,768 |  |  | $ | 81,058 |  |  | $ | 20,589 |
The foreign provision was based on foreign pre-tax earnings of $136.0 million, $62.1 million and $42.2 million in fiscal 2022, 2021 and 2020, respectively. Current foreign tax expense related to foreign tax withholdings was $9.5 million, $7.5 million and $6.4 million in fiscal 2022, 2021 and 2020, respectively. Foreign withholding tax and related foreign tax credits are included in current tax expense above. Deferred tax assets and liabilities at September 30, 2022 and 2021 were as follows:
| September 30,
| 2022 |  | 2021
| (In thousands)
Deferred tax assets: |  |  |
Loss and credit carryforwards | $ | 19,122 |  |  | $ | 30,311 |
Compensation benefits | 29,344 |  |  | 29,305 |
Operating lease liabilities | 13,065 |  |  | 17,076 |
Other assets | 14,744 |  |  | 16,711 |
| 76,275 |  |  | 93,403 |
Less: valuation allowance | (16,635) |  |  | (28,403) |
Total deferred tax assets | 59,640 |  |  | 65,000 |
Deferred tax liabilities: |  |  |
Intangible assets | (14,263) |  |  | (10,518) |
Deferred commission | (12,419) |  |  | (10,520) |
Property and equipment | (327) |  |  | (487) |
Operating lease right-of-use assets | (8,798) |  |  | (11,258) |
Other liabilities | (12,030) |  |  | (11,668) |
Total deferred tax liabilities | (47,837) |  |  | (44,451) |
Deferred tax assets, net | $ | 11,803 |  |  | $ | 20,549 |
Based upon the level of historical taxable income and projections for future taxable income over the periods that the deferred tax assets will reverse, management believes it is more likely than not that we will realize the benefits of the deferred tax assets, net of the existing valuation allowance at September 30, 2022. As of September 30, 2022, we had available U.S. federal net operating loss (“NOL”) carryforwards of approximately $5.4 million. The U.S. federal NOLs were acquired in connection with our acquisitions of Adeptra in fiscal 2012 and Infoglide in fiscal 2013. The U.S. federal NOL carryforward will expire at various dates beginning in fiscal 2024, if not utilized. Utilization of the U.S. federal NOL is subject to an annual limitation due to the “change in ownership” provisions of the Internal Revenue Code of 1986, as amended. We have available an excess California state research credit of approximately $16.0 million. The California state research credit does not have an expiration date; however, based on enacted law and expected future cash taxes, we have recorded a valuation allowance of $16.0 million. There is approximately $0.6 million of foreign tax credit carryforwards. A reconciliation of the provision for income taxes, with the amount computed by applying the U.S. federal statutory income tax rate of 21% to income before provision for income taxes for fiscal 2022, 2021 and 2020 is shown below:
| Year Ended September 30,
| 2022 |  | 2021 |  | 2020
| (In thousands)
Income tax provision at U.S. federal statutory rate | $ | 98,975 |  |  | $ | 99,360 |  |  | $ | 53,970 |
State income taxes, net of U.S. federal benefit | 8,359 |  |  | 7,815 |  |  | 4,619 |
Foreign tax rate differential | 3,058 |  |  | 1,490 |  |  | 493 |
Research credits | (5,932) |  |  | (6,795) |  |  | (5,868) |
Valuation allowance | (11,768) |  |  | 3,839 |  |  | 5,332 |
Excess tax benefits relating to share-based compensation | 702 |  |  | (15,573) |  |  | (45,086) |
GILTI, FDII, BEAT and FTC | (2,491) |  |  | (4,958) |  |  | 7,136 |
Other | 6,865 |  |  | (4,120) |  |  | (7) |
Recorded income tax provision | $ | 97,768 |  |  | $ | 81,058 |  |  | $ | 20,589 |
The increase in our income tax provision in fiscal 2022 compared to fiscal 2021 was due to a decrease in excess tax benefits related to share-based compensation. The increase in our income tax provision in fiscal 2021 compared to fiscal 2020 was due to an increase in pretax book income, of which a large amount was due to the gain on divestiture of C&R business, as well as a decrease in excess tax benefits related to share-based compensation. As of September 30, 2022, we had approximately $73.7 million of unremitted earnings of non-U.S. subsidiaries. The Company has not provided deferred tax liabilities for foreign withholding taxes and certain state income taxes on the undistributed earnings and profits from certain non-U.S. subsidiaries that will be permanently reinvested outside the United States. In the event these earnings are later remitted to the U.S., any estimated withholding tax and state income tax due upon remittance of those earnings is expected to be immaterial to the income tax provision. For jurisdictions not permanently reinvested, the Company expects the net impact of any future repatriations to be immaterial to the Company’s overall tax liability. Unrecognized Tax Benefit for Uncertain Tax Positions We conduct business globally and, as a result, file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. In the normal course of business, we are subject to examination by taxing authorities. With a few exceptions, we are no longer subject to U.S. federal, state, local, or foreign income tax examinations for fiscal years prior to 2019. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| Year Ended September 30,
| 2022 |  | 2021 |  | 2020
| (In thousands)
Gross unrecognized tax benefits at beginning of year | $ | 10,897 |  |  | $ | 7,994 |  |  | $ | 5,834 |
Gross increases for tax positions in prior years | 593 |  |  | — |  |  | 883 |
Gross decreases for tax positions in prior years | — |  |  | (385) |  |  | (65) |
Gross increases based on tax positions related to the current year | 3,250 |  |  | 5,273 |  |  | 2,260 |
Decreases for settlements and payments | — |  |  | (643) |  |  | — |
Decreases due to statute expiration | (1,760) |  |  | (1,342) |  |  | (918) |
Gross unrecognized tax benefits at end of year | $ | 12,980 |  |  | $ | 10,897 |  |  | $ | 7,994 |
We had $13.0 million of total unrecognized tax benefits as of September 30, 2022, including $12.3 million of tax benefits that, if recognized, would impact the effective tax rate. Although the timing and outcome of audit settlements are uncertain, it is unlikely there will be a significant reduction of the uncertain tax benefits in the next twelve months. We recognize interest expense and penalties related to unrecognized tax benefits and penalties as part of the provision for income taxes in our consolidated statements of income and comprehensive income. We recognize interest earned related to income tax matters as interest income in our consolidated statements of income and comprehensive income. As of September 30, 2022, we had accrued interest of $0.5 million related to the unrecognized tax benefits.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition 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. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration