XML 27 R18.htm IDEA: XBRL DOCUMENT
v3.19.2

Income Taxes | 12 Months Ended
--- | ---
Jul. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act includes broad and complex changes to the U.S. tax code that impacted the Company’s accounting and reporting for income taxes during the year ended July 31, 2018. These changes primarily consist of a reduction in the U.S. federal corporate income tax rate from 35% to 21%, the remeasurement of U.S. net deferred tax liabilities as of the effective date utilizing the new U.S. federal corporate income tax rate of 21%, the elimination of the domestic production activities deduction, as well as revised limitations on certain business expenses and executive compensation deductions under “Section 162(m)” of the Internal Revenue Code and provides for a tax on global intangible low-taxed income (“GILTI”), a base erosion anti-abuse tax (“BEAT”) and a deduction for foreign derived intangible income (“FDII”). On December 22, 2017, the Securities and Exchange Commission (“SEC”) staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to provide guidance related to accounting for the income tax effects of the Tax Act. SAB 118 provides that companies (i) should record the effects of the changes from the Tax Act for which the accounting is complete. In addition, SAB 118 established a one-year measurement period (through December 22, 2018) where a provisional amount could be subject to adjustment, and requires certain qualitative and quantitative disclosures related to provisional amounts and accounting during the measurement period. As a result of the Tax Act, the Company recorded a one-time, net tax benefit of $61.0 million on its Consolidated Statement of Operations for the year ended July 31, 2018, as described below. The Company has determined there is no GILTI inclusion for the year, BEAT would not apply and there is no FDII deduction for the year. The Company has not made a policy decision regarding whether to record deferred taxes on GILTI or use the period cost method as the Company has yet to be subject to a GILTI inclusion. Due to the reduction in the U.S. corporate tax rate, the Company remeasured its U.S. net deferred tax liabilities as of the effective date and recognized a one-time benefit of $67.0 million as a discrete item in the benefit from income taxes for the year ended July 31, 2018, which was a reduction in net deferred tax liabilities in the accompanying Consolidated Balance Sheet as of July 31, 2018. The Company also recorded a charge for the Transition Tax of $6.0 million as a discrete item in the benefit from income taxes for the year ended July 31, 2018. The Tax Act does not provide for additional income taxes for any remaining undistributed foreign earnings not subject to the Transition Tax, or for any additional outside basis differences inherent in foreign entities, as these amounts continue to be indefinitely reinvested in those foreign operations. Substantially all of the Company’s unremitted foreign earnings that have not been previously taxed have now been subjected to U.S. taxation under the Transition Tax. The Company has made no additional provision for U.S. income taxes or additional non-U.S. taxes on the remaining unremitted accumulated earnings of non-U.S. subsidiaries. It is not practical at this time to determine the income tax liability related to any remaining undistributed earnings or additional basis difference not subject to the Transition Tax. U.S. and foreign components of income before (provision) benefit from income taxes is as follows (in thousands):
| Year Ended July 31,
| 2019 | 2018 | 2017
U.S. | $ | 306,323 |  | $ | 264,379 |  | $ | 251,478 |
Foreign | 92,642 |  | 75,713 |  | 96,971 |
Income before income taxes | $ | 398,965 |  | $ | 340,092 |  | $ | 348,449 |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and income tax purposes. Significant components of the Company’s deferred tax liabilities and assets are as follows (in thousands):
| July 31,
| 2019 | 2018
Deferred income tax liabilities: |  |
Fixed assets | $ | 153,182 |  | $ | 126,697 |
Intangible assets | 73,146 |  | 54,708 |
Other | 13,425 |  | 12,865 |
Total | 239,753 |  | 194,270 |
Deferred income tax assets: |  |
Canyons obligation | 13,922 |  | 13,145 |
Stock-based compensation | 9,620 |  | 9,824 |
Investment in Partnerships | 13,281 |  | 15,113 |
Deferred compensation and other accrued benefits | 10,674 |  | 9,220 |
Contingent Consideration | 6,771 |  | 5,476 |
Unfavorable lease obligation, net | 4,896 |  | 5,580 |
Net operating loss carryforwards and other tax credits | 5,631 |  | 5,716 |
Other, net | 18,850 |  | 11,501 |
Total | 83,645 |  | 75,575 |
Valuation allowance for deferred income taxes | (5,365 | ) | (5,450 | )
Deferred income tax assets, net of valuation allowance | 78,280 |  | 70,125 |
Net deferred income tax liability | $ | 161,473 |  | $ | 124,145 |
The components of deferred income taxes recognized in the Consolidated Balance Sheets are as follows (in thousands):
| July 31,
| 2019 | 2018
Non-current deferred income tax asset | $ | 7,286 |  | $ | 9,773 |
Net non-current deferred income tax liability | 168,759 |  | 133,918 |
Net deferred income tax liability | $ | 161,473 |  | $ | 124,145 |
Significant components of the provision (benefit) from income taxes are as follows (in thousands):
| Year Ended July 31,
| 2019 | 2018 | 2017
Current: |  |  |
Federal | $ | 24,309 |  | $ | (43,366 | ) | $ | 55,887 |
State | 8,539 |  | 9,562 |  | 8,096 |
Foreign | 20,205 |  | 18,436 |  | 16,311 |
Total current | 53,053 |  | (15,368 | ) | 80,294 |
Deferred: |  |  |
Federal | 16,983 |  | (45,922 | ) | 29,065 |
State | 5,282 |  | 2,941 |  | 3,601 |
Foreign | 154 |  | (2,789 | ) | 3,771 |
Total deferred | 22,419 |  | (45,770 | ) | 36,437 |
Provision (benefit) from income taxes | $ | 75,472 |  | $ | (61,138 | ) | $ | 116,731 |
A reconciliation of the income tax (benefit) provision from continuing operations and the amount computed by applying the United States federal statutory income tax rate to income before income taxes is as follows:
| Year Ended July 31,
| 2019 | 2018 | 2017
At U.S. federal income tax rate | 21.0 | % | 26.8 | % | 35.0 | %
State income tax, net of federal benefit | 2.8 | % | 3.0 | % | 2.2 | %
Change in uncertain tax positions | (1.6 | )% | — | % | — | %
Change in valuation allowance | — | % | 0.3 | % | 0.9 | %
Excess tax benefits related to stock-based compensation | (3.0 | )% | (20.9 | )% | — | %
Impacts of the Tax Act | — | % | (24.7 | )% | — | %
Noncontrolling interests | (1.5 | )% | (1.7 | )% | (2.1 | )%
Foreign rate differential | 0.4 | % | (1.5 | )% | (3.4 | )%
Other | 0.8 | % | 0.7 | % | 0.9 | %
Effective tax rate | 18.9 | % | (18.0 | )% | 33.5 | %
A reconciliation of the beginning and ending amount of unrecognized tax benefits associated with uncertain tax positions, excluding associated deferred tax benefits and accrued interest and penalties, if applicable, is as follows (in thousands):
| Year Ended July 31,
| 2019 | 2018 | 2017
Balance, beginning of year | $ | 78,242 |  | $ | 76,111 |  | $ | 57,032 |
Additions based on tax positions related to the current year | — |  | — |  | — |
Additions for tax positions of prior years | 11,520 |  | 12,394 |  | 19,079 |
Reductions for tax positions of prior years | — |  | — |  | — |
Lapse of statute of limitations | (17,540 | ) | (10,263 | ) | — |
Settlements | — |  | — |  | — |
Balance, end of year | $ | 72,222 |  | $ | 78,242 |  | $ | 76,111 |
As of July 31, 2019, the Company’s unrecognized tax benefits associated with uncertain tax positions relate to the treatment of the Talisker lease payments as payments of debt obligations and that the tax basis in Canyons goodwill is deductible, and are included within “other long-term liabilities” in the accompanying Consolidated Balance Sheets. During the year ended July 31, 2019, the Company experienced a reduction in the uncertain tax positions due to the lapse of the statute of limitations of $17.5 million, which was offset with an increase to the uncertain tax position of $11.5 million. Interest and penalties associated with the statute of limitations lapse were approximately $2.3 million. The Company is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months. Additionally, the Company expects a reduction to its uncertain tax positions for the fiscal year ending July 31, 2020, due to the lapse of the statute of limitations. As of July 31, 2019 and 2018, accrued interest and penalties, net of tax, was $6.3 million and $5.2 million, respectively. For the years ended July 31, 2019, 2018 and 2017, the Company recognized as income tax expense $1.1 million, $1.6 million and $2.0 million of interest expense and penalties, net of tax, respectively. The Company’s major tax jurisdictions in which it files income tax returns is the U.S. federal jurisdiction, various state jurisdictions, Australia, and Canada. The Company is no longer subject to U.S. federal examinations for tax years prior to 2015. With few exceptions, the Company is no longer subject to examination by various U.S. state jurisdictions for tax years prior to 2013. Additionally, the Company is no longer subject to audits for the tax years prior to 2014 for Australia and Canada. The Company has NOL carryforwards totaling $8.9 million which are primarily comprised of state net operating loss (“NOL”) carryforwards that expire by the year ending July 31, 2031. As of July 31, 2019, the Company has recorded a valuation allowance on $4.0 million of these NOL carryforwards as the Company has determined that it is more likely than not that these NOL carryforwards will not be realized. Additionally, the Company has foreign tax credit carryforwards of $4.2 million, which expire by the year ending July 31, 2027. As of July 31, 2019, the Company has recorded a valuation allowance of $4.2 million on foreign tax credit carryforwards as the Company has determined that it is more likely than not that these foreign tax credit carryforwards will not be realized.

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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration