XML 165 R20.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2013
Income Taxes | 13. Income Taxes The Company’s United States and Irish based subsidiaries file tax returns in the United States and Ireland respectively. Other foreign subsidiaries are taxed separately under the laws of their respective countries. The components of income before provision for income tax expense are as follows:
|  | Year ended |
|  | December |  |  | December |  |  | December |
|  | 2013 |  |  | 2012 |  |  | 2011 |
|  | (in thousands) |
Ireland |  | $ | 80,914 |  |  | $ | 12,157 |  |  | $ | (33,732 | )
United States |  |  | 16,218 |  |  |  | 11,371 |  |  |  | 13,317 |
Other |  |  | 23,733 |  |  |  | 43,693 |  |  |  | 49,410 |
Income before provision for income taxes |  | $ | 120,865 |  |  | $ | 67,221 |  |  | $ | 28,995 |
The components of total income tax expense are as follows:
|  | Year ended |
|  | December |  |  | December |  |  | December |
|  | 2013 |  |  | 2012 |  |  | 2011 |
|  | (in thousands) |
Provision for income taxes: |  |  |  |  |  |  |  |  |
Current: |  |  |  |  |  |  |  |  |
Ireland |  | $ | 9,158 |  |  | $ | 1,684 |  |  | $ | 351 |
United States |  |  | 14,492 |  |  |  | 12,290 |  |  |  | 6,367 |
Other |  |  | 4,876 |  |  |  | 8,257 |  |  |  | 5,518 |
Total current tax |  |  | 28,526 |  |  |  | 22,231 |  |  |  | 12,236 |
Deferred expense/(benefit): |  |  |  |  |  |  |  |  |  |  |  |
Ireland |  |  | 1,914 |  |  |  | (287 | ) |  |  | (3,825 | )
United States |  |  | (9,420 | ) |  |  | (9,715 | ) |  |  | (1,711 | )
Other |  |  | (2,967 | ) |  |  | (428 | ) |  |  | (585 | )
Total deferred tax expense/(benefit) |  |  | (10,473 | ) |  |  | (10,430 | ) |  |  | (6,121 | )
Provision for income taxes |  |  | 18,053 |  |  |  | 11,801 |  |  |  | 6,115 |
Impact on shareholders equity and other comprehensive income of the tax consequence of : |  |  |  |  |  |  |  |  |  |  |  |
Excess tax benefit on stock compensation |  |  | (1,651 | ) |  |  | (1,274 | ) |  |  | (681 | )
Currency impact on long term funding |  |  | 87 |  |  |  | 356 |  |  |  | (294 | )
Total |  | $ | 16,489 |  |  | $ | 10,883 |  |  | $ | 5,140 |
Ireland’s statutory income tax rate is 12.5%. The Company’s consolidated effective tax rate differed from the statutory rate as set forth below;
|  | Year ended |
|  | December |  |  | December |  |  | December |
|  | 2013 |  |  | 2012 |  |  | 2011 |
|  | (in thousands) |
Taxes at Irish statutory rate of 12.5% (2011:12.5%; 2012: 12.5%) |  | $ | 15,108 |  |  | $ | 8,401 |  |  | $ | 3,625 |
Foreign and other income taxed at higher/(reduced) rates |  |  | 4,229 |  |  |  | 7,873 |  |  |  | 5,373 |
Research & development tax incentives |  |  | (2,598 | ) |  |  | (4,954 | ) |  |  | (6,341 | )
Movement in valuation allowance |  |  | 2,389 |  |  |  | 1,557 |  |  |  | 4,362 |
Prior year over provision in respect of foreign taxes |  |  | (47 | ) |  |  | (678 | ) |  |  | (83 | )
Effects of permanent items |  |  | (1,002 | ) |  |  | (26 | ) |  |  | (615 | )
Other |  |  | (26 | ) |  |  | (372 | ) |  |  | (206 | )
|  | $ | 18,053 |  |  | $ | 11,801 |  |  | $ | 6,115 |
The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are presented below:
|  | Year ended |
|  | December |  |  | December |  |  | December |
|  | 2013 |  |  | 2012 |  |  | 2011 |
|  | (in thousands) |
Deferred tax liabilities: |  |  |  |  |  |  |  |  |
Property, plant and equipment |  | $ | 6,501 |  |  | $ | 6,631 |  |  | $ | 7,331 |
Goodwill |  |  | 14,013 |  |  |  | 11,467 |  |  |  | 9,443 |
Other intangible assets |  |  | 970 |  |  |  | 2,707 |  |  |  | 3,525 |
Accruals |  |  | 51 |  |  |  | 77 |  |  |  | 1,185 |
Other |  |  | 4 |  |  |  | 88 |  |  |  | 97 |
Unrealised FX |  |  | 1,056 |  |  |  | 1,160 |  |  |  | - |
Total deferred tax liabilities recognized |  |  | 22,595 |  |  |  | 22,130 |  |  |  | 21,581 |
Deferred tax assets: |  |  |  |  |  |  |  |  |  |  |  |
Net operating loss carry forwards |  |  | 27,646 |  |  |  | 25,116 |  |  |  | 21,981 |
Property, plant and equipment |  |  | 2,739 |  |  |  | 2,345 |  |  |  | 1,324 |
Accrued expenses and payments on account |  |  | 29,429 |  |  |  | 19,382 |  |  |  | 11,652 |
Stock compensation |  |  | 6,291 |  |  |  | 5,586 |  |  |  | 4,818 |
Deferred compensation expense |  |  | 1,187 |  |  |  | 1,136 |  |  |  | 1,197 |
Other |  |  | - |  |  |  | - |  |  |  | 214 |
Unrealised FX |  |  | 92 |  |  |  | 98 |  |  |  | - |
Total deferred tax assets |  |  | 67,384 |  |  |  | 53,663 |  |  |  | 41,186 |
Valuation allowance for deferred tax assets |  |  | (21,591 | ) |  |  | (18,817 | ) |  |  | (16,445 | )
Deferred tax assets recognized |  | $ | 45,793 |  |  | $ | 34,846 |  |  | $ | 24,741 |
Net deferred tax asset |  | $ | 23,198 |  |  | $ | 12,716 |  |  | $ | 3,160 |
At December 31, 2013 non-U.S subsidiaries had operating loss carry forwards for income tax purposes that may be carried forward indefinitely, available to offset against future taxable income, if any, of approximately $96.2 million (2012: $94.4 million). At December 31, 2013 non-U.S. subsidiaries also had additional operating loss carry forwards of $5.9 million which are due to expire between 2014 and 2016. At December 31, 2013 U.S. subsidiaries, had U.S. federal and state net operating loss (“NOL”) carry forwards of approximately $8.3 million and $15.9 million, respectively. These net operating losses are available for offset against future taxable income and expire between 2014 and 2032. Of the $8.3 million U.S. federal and $15.9 million state net operating losses, approximately $7.6 million and $15.2 million are currently available for offset against future U.S. federal and state taxable income respectively. Annual utilization of these state net operating losses may be limited by specific state rules. The subsidiary’s ability to use the remaining U.S. federal and state net operating loss carry forwards of $0.7 million and $0.7 million, respectively is further limited to $113,000 per year due to a change of ownership in 2000, as defined by Section 382 of the Internal Revenue Code of 1986, as amended. The expected expiry dates of these losses are as follows:
| Federal |  |  | State |
| NOL’s |  |  | NOL’s |
| (in thousands) |
2014- 2020 | $ | 678 |  |  | $ | 678 |
2021- 2025 |  | - |  |  |  | 8,572 |
2026- 2032 |  | 7,644 |  |  |  | 6,648 |
| $ | 8,322 |  |  | $ | 15,898 |
In addition US subsidiaries have alternative minimum tax credit carry forwards of approximately $0.3 million that are available to reduce future U.S. federal regular income taxes, over an indefinite period. They also have general business credit carry forwards of approximately $0.3 million that are available to offset future U.S. federal income taxes. The valuation allowance at December 31, 2013 was approximately $21.6 million. The valuation allowance for deferred tax assets as of December 31, 2012 and December 31, 2011 was $18.8 million and $16.4 million respectively. The net change in the total valuation allowance was an increase of $2.8 million during 2013 and an increase of $2.4 million during 2012. The valuation allowances at December 31, 2013 and December 31, 2012 were primarily related to tax losses and tax credits carried forward that, in the judgment of management, are not more likely than not to be realized. 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 tax assets will not be realized. The ultimate realization of deferred 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 tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. The Company has not recognized a deferred tax liability for the undistributed earnings of foreign subsidiaries that arose in 2013 and prior years as the Company considers these earnings to be indefinitely reinvested. It is not practical to calculate the unrecognized deferred tax liability. A reconciliation of the beginning and ending amount of total unrecognized tax benefits is as follows:
|  | December 31, |  |  | December 31, |  |  | December 31, |
|  | 2013 |  |  | 2012 |  |  | 2011 |
|  | (in thousands) |
Gross amount of unrecognized tax benefits at start of year |  | $ | 7,189 |  |  | $ | 6,543 |  |  | $ | 8,566 |
Increase related to prior year tax positions |  |  | - |  |  |  | 1,167 |  |  |  | 304 |
Decrease related to prior year tax positions |  |  | (494 | ) |  |  | - |  |  |  | (36 | )
Increase related to current year tax positions |  |  | 2,269 |  |  |  | 1,473 |  |  |  | 482 |
Settlements |  |  | (899 | ) |  |  | (98 | ) |  |  | - |
Lapse of statute of limitations |  |  | (2,285 | ) |  |  | (1,896 | ) |  |  | (2,773 | )
Gross amount of unrecognized tax benefits at end of year |  | $ | 5,780 |  |  | $ | 7,189 |  |  | $ | 6,543 |
The relevant statute of limitations for gross unrealized tax benefits totaling $1.2 million could potentially expire during 2014. Included in the balance of total unrecognized tax benefits at December 31, 2013 there were net potential benefits of $5.8 million, which if recognized, would affect the effective rate on income tax from continuing operations. The balance of total unrecognized tax benefits at December 31, 2012 and December 31, 2011 included net potential benefits which, if recognized, would affect the effective rate of income tax from continuing operations of $7.2 million and $6.5 million respectively. Interest and penalties recognized as a net benefit during the year ended December 31, 2013 amounted to $0.2 million (2012: $0.1 million) and are included within the provision for income taxes. Total accrued interest and penalties as of December 31, 2013 and December 31, 2012 were $0.9 million and $1.1 million respectively and are included in the closing income tax liabilities at those dates. Our major tax jurisdictions are the United States and Ireland. We may potentially be subjected to tax audits in both our major jurisdictions. In the United States tax periods open to audit include the years December 31, 2010, December 31, 2011, December 31, 2012 and December 31, 2013. In Ireland tax periods open to audit include the years ended December 31, 2008, December 31, 2009, December 31, 2010, December 31, 2011, December 31, 2012 and December 31, 2013. During such audits, local tax authorities may challenge the positions taken by us in tax returns.

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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration