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INCOME TAXES | 12 Months Ended
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Jun. 30, 2014
Income Tax Disclosure [Abstract] |
INCOME TAXES | NOTE 19. INCOME TAXES The domestic and foreign components of income before provision for income taxes are as follows (in thousands):
|  | Year ended June 30, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Domestic |  | $ | 204,879 |  |  | $ | 231,342 |  |  | $ | 263,790 |
Foreign |  |  | 13,763 |  |  |  | 12,694 |  |  |  | 11,201 |
Income before income taxes |  | $ | 218,642 |  |  | $ | 244,036 |  |  | $ | 274,991 |
The components of income tax expense are as follows (in thousands):
|  | Year ended June 30, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 53,055 |  |  | $ | 47,038 |  |  | $ | 76,874 |
State and local |  |  | 11,456 |  |  |  | 10,767 |  |  |  | 16,678 |
Foreign |  |  | 3,256 |  |  |  | 3,440 |  |  |  | 3,332 |
Total current |  |  | 67,767 |  |  |  | 61,245 |  |  |  | 96,884 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 12,580 |  |  |  | 26,218 |  |  |  | 9,000 |
State and local |  |  | 2,680 |  |  |  | 5,313 |  |  |  | 1,458 |
Foreign |  |  | 299 |  |  |  | (429 | ) |  |  | 195 |
Total deferred |  |  | 15,559 |  |  |  | 31,102 |  |  |  | 10,653 |
Total income tax expense |  | $ | 83,326 |  |  | $ | 92,347 |  |  | $ | 107,537 |
Income tax expense differs from the amounts computed by applying the statutory U.S. income tax rate of 35 percent as a result of the following (in thousands):
|  | Year ended June 30, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Expected tax expense computed at federal rate |  | $ | 76,525 |  |  | $ | 85,413 |  |  | $ | 96,247 |
State and local taxes, net of federal benefit |  |  | 9,188 |  |  |  | 10,452 |  |  |  | 11,788 |
(Nonincludible) nondeductible items |  |  | 1,150 |  |  |  | (929 | ) |  |  | 2,424 |
Incremental effect of foreign tax rates |  |  | (1,885 | ) |  |  | (1,376 | ) |  |  | (1,026 | )
Other |  |  | (1,652 | ) |  |  | (1,213 | ) |  |  | (1,896 | )
Total income tax expense |  | $ | 83,326 |  |  | $ | 92,347 |  |  | $ | 107,537 |
The tax effects of temporary differences that give rise to deferred taxes are presented below (in thousands):
|  | June 30, |
|  | 2014 |  |  | 2013 |
Deferred tax assets: |  |  |  |  |  |  |  |
Deferred compensation and post-retirement obligations |  | $ | 35,360 |  |  | $ | 34,597 |
Reserves and accruals |  |  | 28,176 |  |  |  | 27,640 |
Stock-based compensation |  |  | 8,301 |  |  |  | 13,409 |
Deferred rent |  |  | 4,632 |  |  |  | 3,522 |
Other |  |  | 13,127 |  |  |  | 7,900 |
Total deferred tax assets |  |  | 89,596 |  |  |  | 87,068 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Goodwill and other intangible assets |  |  | (243,035 | ) |  |  | (162,739 | )
Unbilled revenue |  |  | (6,948 | ) |  |  | (11,583 | )
Prepaid expenses |  |  | (4,986 | ) |  |  | (4,638 | )
Other |  |  | (9,780 | ) |  |  | (9,040 | )
Total deferred tax liabilities |  |  | (264,749 | ) |  |  | (188,000 | )
Net deferred tax liability |  | $ | (175,153 | ) |  | $ | (100,932 | )
The Company is subject to income taxes in the U.S. and various state and foreign jurisdictions. Tax statutes and regulations within each jurisdiction are subject to interpretation and require the application of significant judgment. The Company’s consolidated federal income tax returns through June 30, 2009 are no longer subject to audit. The Company is currently under examination by two state jurisdictions and one foreign jurisdiction for years ended June 30, 2004 through June 30, 2012. The Company does not expect the resolution of these examinations to have a material impact on its results of operations, financial condition or cash flows. During the years ended June 30, 2014 and 2013, the Company’s income tax expense was favorably impacted by non-taxable gains on assets invested in corporate-owned life insurance (COLI) policies, and tax benefits related to deductions claimed for income from domestic production activities. In connection with the issuance of the Notes referred to in Note 13, there was original issue discount (OID) created for income tax purposes. Over the term of the Notes, this OID generated additional interest expense for income tax reporting purposes. As of June 30, 2013, the Company corrected the classification of $4.2 million of deferred tax liabilities by reclassifying this amount from non-current deferred tax liabilities to a reduction of current deferred tax assets and concluded that this reclassification was not material. U.S. income taxes have not been provided for undistributed earnings of foreign subsidiaries that have been permanently reinvested outside the United States. As of June 30, 2014, the estimated deferred tax liability associated with these undistributed earnings is approximately $8.8 million. The Company’s total liability for unrecognized tax benefits as of June 30, 2014, 2013 and 2012 was approximately $9.6 million, $8.2 million and $7.0 million, respectively. Of the unrecognized tax benefits at June 30, 2014, 2013, and 2012, $2.4 million, $2.6 million and $2.4 million, respectively, if recognized, would impact the Company’s effective tax rate. A reconciliation of the beginning and ending amount of unrecognized benefits is shown in the table below (in thousands):
|  | Year ended June 30, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Beginning of year |  | $ | 8,184 |  |  | $ | 7,013 |  |  | $ | 5,897 |
Additions based on current year tax positions |  |  | 2,023 |  |  |  | 1,261 |  |  |  | 1,181 |
Lapse of statute of limitations |  |  | (426 | ) |  |  | (90 | ) |  |  | (65 | )
Settlement with taxing authorities |  |  | (145 | ) |  |  | — |  |  |  | — |
End of year |  | $ | 9,636 |  |  | $ | 8,184 |  |  | $ | 7,013 |
The Company recognizes net interest and penalties as a component of income tax expense. Over the next 12 months, the Company does not expect a significant increase or decrease in the unrecognized tax benefits recorded at June 30, 2014. As of June 30, 2014, approximately $9.2 million of the unrecognized tax benefits are included in other long-term liabilities, with the remainder included in other balance sheet accounts.

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- 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
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