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Income Taxes | 12 Months Ended
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Mar. 31, 2014
Income Taxes [Abstract] |
Income Taxes | Note 8: Income Taxes The U.S. and foreign components of earnings (loss) from continuing operations before income taxes and the (benefit) provision for income taxes consisted of the following:
|  | Years ended March 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Components of earnings (loss) from continuing operations before income taxes: |  |  |  |  |  |  |  |  |
United States |  | $ | 14.1 |  |  | $ | 10.2 |  |  | $ | 17.2 |
Foreign |  |  | 9.9 |  |  |  | (23.2 | ) |  |  | 30.7 |
Total earnings (loss) from continuing operations before income taxes |  | $ | 24.0 |  |  | $ | (13.0 | ) |  | $ | 47.9 |
Income tax (benefit) expense: |  |  |  |  |  |  |  |  |  |  |  |
Federal: |  |  |  |  |  |  |  |  |  |  |  |
Current |  | $ | (2.0 | ) |  | $ | 2.6 |  |  | $ | - |
Deferred |  |  | (95.8 | ) |  |  | (2.6 | ) |  |  | 0.3 |
State: |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  | 0.2 |  |  |  | 0.2 |  |  |  | 0.3 |
Deferred |  |  | (21.4 | ) |  |  | (0.2 | ) |  |  | (0.2 | )
Foreign: |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  | 10.0 |  |  |  | 6.4 |  |  |  | 8.3 |
Deferred |  |  | 1.1 |  |  |  | 3.4 |  |  |  | 1.2 |
Total income tax (benefit) expense |  | $ | (107.9 | ) |  | $ | 9.8 |  |  | $ | 9.9 |
The Company allocates income tax expense between continuing operations, discontinued operations, and other comprehensive income. We apply accounting for income taxes by tax jurisdiction, and in periods in which there is loss from continuing operations before income taxes and pre-tax income in other categories (e.g., discontinued operations or other comprehensive income), we first allocate income tax expense to the other sources of income, and record a related tax benefit in continuing operations. Income tax expense attributable to earnings (loss) from continuing operations before income taxes differed from the amounts computed by applying the statutory U.S. federal income tax rate as a result of the following:
|  | Years ended March 31, |
|  | 2014 |  |  | 2013 |  |  | 2012 |
Statutory federal tax |  |  | 35.0 | % |  |  | 35.0 | % |  |  | 35.0 | %
State taxes, net of federal benefit |  |  | 2.1 |  |  |  | (1.3 | ) |  |  | (0.1 | )
Taxes on non-U.S. earnings and losses |  |  | (3.8 | ) |  |  | (23.8 | ) |  |  | (5.7 | )
Valuation allowance |  |  | (471.7 | ) |  |  | (59.3 | ) |  |  | 2.1 |
Tax credits |  |  | (7.1 | ) |  |  | 37.0 |  |  |  | (19.2 | )
Compensation |  |  | 0.4 |  |  |  | (13.0 | ) |  |  | 3.4 |
Foreign tax rate or law changes |  |  | (9.2 | ) |  |  | 0.9 |  |  |  | 0.6 |
Uncertain tax positions net of settlements |  |  | 0.4 |  |  |  | (41.9 | ) |  |  | 1.9 |
Brazilian interest on equity |  |  | (1.7 | ) |  |  | 3.2 |  |  |  | (1.0 | )
Dividend repatriation |  |  | 5.8 |  |  |  | (11.4 | ) |  |  | 4.4 |
Other |  |  | 0.2 |  |  |  | (0.8 | ) |  |  | (0.7 | )
Effective tax rate |  |  | (449.6 | %) |  |  | (75.4 | %) |  |  | 20.7 | %
Since the third quarter of fiscal 2008, the Company maintained a full valuation allowance against net deferred tax assets in the U.S. since it was more likely than not that the net deferred tax assets would not be realized. The determination of recording and releasing valuation allowances against deferred tax assets is made, in part, pursuant to the Company's assessment of whether it is more likely than not that it will generate sufficient future taxable income against which benefits of the deferred tax assets may or may not be realized. Significant judgment is required when making estimates of the Company’s ability to generate income in future periods. During fiscal 2014, the Company recorded a $6.2 million reduction to the valuation allowance in the U.S. based upon fiscal 2014 activity. Additionally, as of March 31, 2014, the Company concluded it no longer needed a valuation allowance on certain U.S. deferred tax assets, primarily due to the sustained history of U.S. earnings, the favorable impact previous restructuring actions have had on U.S. operating results, current market conditions and trends, and expected future taxable income. As a result, the Company recorded a $119.2 million reversal of its deferred tax asset valuation allowance after determining it was more likely than not that certain U.S. deferred tax assets would be realized. The Company continues to provide a valuation allowance against $15.3 million of U.S. net deferred tax assets since it is more likely than not that these assets will not be realized. During fiscal 2014, the Company recorded an additional valuation allowance of $12.3 million against net deferred tax assets in certain foreign jurisdictions. This increase was largely related to losses in Germany and China based upon the determination that it was more likely than not that the net deferred tax assets in these jurisdictions will not be realized. The Company will continue to provide a valuation allowance against its net deferred tax assets in each of the applicable jurisdictions going forward until the need for a valuation allowance is eliminated. The need for the valuation allowance is eliminated when the Company determines it is more likely than not that the deferred tax assets will be realized. Also during fiscal 2014, the Company recorded income tax benefits totaling $2.2 million related to foreign tax law changes. During fiscal 2012, the Company satisfied requirements under Hungarian regulations necessary to obtain development tax credits in Hungary and, as a result, recorded a $4.4 million tax benefit, which significantly impacted its effective tax rate for the year. The tax effects of temporary differences that give rise to deferred tax assets and deferred tax liabilities were as follows:
|  | March 31, |
|  | 2014 |  |  | 2013 |
Deferred tax assets: |  |  |  |  |  |
Accounts receivable |  | $ | 0.2 |  |  | $ | 0.4 |
Inventories |  |  | 4.1 |  |  |  | 4.1 |
Plant and equipment |  |  | 2.4 |  |  |  | 1.6 |
Pension and employee benefits |  |  | 39.1 |  |  |  | 48.5 |
Net operating loss, capital loss, and credit carryforwards |  |  | 122.4 |  |  |  | 117.6 |
Other, principally accrued liabilities |  |  | 10.3 |  |  |  | 12.0 |
Total gross deferred tax assets |  |  | 178.5 |  |  |  | 184.2 |
Less: valuation allowance |  |  | (61.2 | ) |  |  | (172.8 | )
Net deferred tax assets |  |  | 117.3 |  |  |  | 11.4 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Goodwill |  |  | 4.2 |  |  |  | 4.7 |
Plant and equipment |  |  | 7.6 |  |  |  | 5.6 |
Other |  |  | 1.7 |  |  |  | 2.9 |
Total gross deferred tax liabilities |  |  | 13.5 |  |  |  | 13.2 |
Net deferred tax asset (liability) |  | $ | 103.8 |  |  | $ | (1.8 | )
Deferred tax assets and liabilities are reported in the consolidated balance sheets as follows:
|  | March 31, |
|  | 2014 |  |  | 2013 |
Current deferred tax asset |  | $ | 13.0 |  |  | $ | 6.6 |
Noncurrent deferred tax asset |  |  | 98.6 |  |  |  | 0.4 |
Current deferred tax liability (other current liabilities) |  |  | (0.5 | ) |  |  | (0.2 | )
Noncurrent deferred tax liability |  |  | (7.3 | ) |  |  | (8.6 | )
Total |  | $ | 103.8 |  |  | $ | (1.8 | )
A reconciliation of unrecognized tax benefits is as follows:
|  | Years ended March 31, |
|  | 2014 |  |  | 2013 |
Beginning balance |  | $ | 9.0 |  |  | $ | 3.3 |
Gross increases - tax positions in prior period |  |  | 2.5 |  |  |  | 5.6 |
Gross decreases - tax positions in prior period |  |  | (7.0 | ) |  |  | (0.1 | )
Gross increases - tax positions in current period |  |  | 0.1 |  |  |  | 0.6 |
Gross decreases - tax positions in current period |  |  | - |  |  |  | (0.4 | )
Settlements |  |  | (1.9 | ) |  |  | - |
Lapse of statute of limitations |  |  | (0.8 | ) |  |  | - |
Effect of exchange rate changes |  |  | 0.2 |  |  |  | - |
Ending balance |  | $ | 2.1 |  |  | $ | 9.0 |
The Company’s liability for unrecognized tax benefits as of March 31, 2014 of $2.1 million, if recognized, would have an effective tax rate impact. In accordance with its accounting policy, the Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. During fiscal 2014, no interest and penalties were included as a component of income tax expense in the consolidated statement of operations. At March 31, 2014 and 2013, accrued interest and penalties were not material. The Company files income tax returns in multiple jurisdictions and is subject to examination by taxing authorities throughout the world. During fiscal 2014, the Company was engaged in income tax examinations by the German taxing authority covering fiscal years 2006 through 2010 and the Austrian taxing authority covering fiscal years 2009 through 2011. Both the German and Austrian audits were settled during fiscal 2014. The Company does not anticipate a significant change in unrecognized tax benefits during the next twelve months. The following tax years remain subject to examination for the Company’s major tax jurisdictions:
Austria | Fiscal 2012 - 2013
Brazil | Calendar 2009 - 2013
Germany | Fiscal 2011 - 2013
United States | Fiscal 2011 - 2013
At March 31, 2014, the Company has foreign tax credit carry forwards of $2.4 million that, if not utilized against domestic taxes, will expire between 2015 and 2017. The Company also has federal and state research and development tax credits of $18.7 million that, if not utilized against domestic taxes, will expire between 2018 and 2034. The Company also has various state and local tax loss carry forwards of $188.0 million that, if not utilized against state apportioned taxable income, will expire at various times during 2015 through 2034. In addition, the Company has tax loss carry forwards of $356.5 million in various tax jurisdictions throughout the world. Certain of the carry forwards in the U.S. and many in foreign jurisdictions are offset by a valuation allowance. If not utilized against taxable income, $195.5 million of these tax losses will expire at various times during 2015 through 2034, and $161.0 million, mainly related to India, Austria and Germany, will not expire due to an unlimited carry-forward period. At March 31, 2014, the Company had provided $0.2 million of U.S. tax and $1.0 million of foreign tax on undistributed earnings of certain joint equity investment companies and certain European subsidiaries considered not permanently reinvested. Undistributed earnings are considered permanently reinvested in the remaining foreign operations totaling $497.6 million, and no provision has been made for any taxes that would be payable upon the distribution of such earnings. It is not practicable to estimate the amount of unrecognized withholding taxes and deferred tax liability on such earnings.

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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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