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Income taxes (Tables) | 12 Months Ended
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Sep. 30, 2020
Income Tax Disclosure [Abstract] |
Components of income from continuing operations before income taxes | The components of income before income taxes and the corresponding provision for income taxes are as follows:
|  | Year ended September 30,
(in thousands) |  | 2020 |  | 2019 |  | 2018
Income before income taxes: |  |  |  |  |  |
United States |  | $ | 304,240 |  |  | $ | 280,092 |  |  | $ | 248,360 |
Foreign |  | (17,178) |  |  | 37,228 |  |  | 50,849 |
Income before income taxes |  | $ | 287,062 |  |  | $ | 317,320 |  |  | $ | 299,209 |
Provision for income taxes |
|  | Year ended September 30,
(in thousands) |  | 2020 |  | 2019 |  | 2018
Current provision/(benefit): |  |  |  |  |  |
Federal |  | $ | 65,735 |  |  | $ | 37,123 |  |  | $ | 42,318 |
State and local |  | 28,117 |  |  | 14,480 |  |  | 13,459 |
Foreign |  | (2,154) |  |  | 12,561 |  |  | 15,895 |
Total current provision |  | 91,698 |  |  | 64,164 |  |  | 71,672 |
Deferred tax expense/(benefit): |  |  |  |  |  |
Federal |  | (12,984) |  |  | 12,627 |  |  | 4,106 |
State and local |  | (4,246) |  |  | 3,013 |  |  | 2,902 |
Foreign |  | (1,915) |  |  | (2,979) |  |  | (287) |
Total deferred tax expense/(benefit) |  | (19,145) |  |  | 12,661 |  |  | 6,721 |
Provision for income taxes |  | $ | 72,553 |  |  | $ | 76,825 |  |  | $ | 78,393 |
Reconciliation of tax provision using the federal statutory income tax rate to reported provision | The provision for income taxes differs from that which would have resulted from the use of this rate is as follows:
|  | Year ended September 30,
(in thousands) |  | 2020 |  | 2019 |  | 2018
Federal income tax provision at statutory rate of 21%, 21% and 24.5%, respectively |  | $ | 60,284 |  |  | $ | 66,637 |  |  | $ | 73,396 |
State income taxes, net of federal benefit |  | 17,480 |  |  | 14,825 |  |  | 12,348 |
Foreign taxation |  | (463) |  |  | 1,210 |  |  | (1,531) |
Permanent items |  | 2,200 |  |  | 2,682 |  |  | 1,176 |
Tax credits |  | (4,149) |  |  | (3,730) |  |  | (2,438) |
Toll tax |  | — |  |  | (481) |  |  | 9,425 |
Deferred tax liability - tax rate change |  | — |  |  | — |  |  | (10,514) |
Vesting of equity compensation |  | (2,038) |  |  | (4,783) |  |  | (2,849) |
Other |  | (761) |  |  | 465 |  |  | (620) |
Provision for income taxes |  | $ | 72,553 |  |  | $ | 76,825 |  |  | $ | 78,393 |
Significant items comprising the Company's deferred tax assets and liabilities | The significant items comprising our deferred tax assets and liabilities as of September 30, 2020 and 2019, are as follows:
|  | As of September 30,
(in thousands) |  | 2020 |  | 2019
Net deferred tax assets/(liabilities) |  |  |  |
Costs deductible in future periods |  | $ | 24,127 |  |  | $ | 19,133 |
Deferred revenue |  | 8,054 |  |  | 6,098 |
Stock compensation |  | 4,140 |  |  | 3,617 |
Net operating loss carryforwards |  | 252 |  |  | 798 |
Amortization of goodwill and intangible assets |  | (27,555) |  |  | (26,338) |
Capitalized software |  | (10,076) |  |  | (8,635) |
Accounts receivable - unbilled |  | (11,565) |  |  | (35,566) |
Property and equipment |  | (2,365) |  |  | 515 |
Prepaid expenses |  | (4,245) |  |  | (3,645) |
Other |  | (3,589) |  |  | (2,351) |
|  | $ | (22,822) |  |  | $ | (46,374) |
Our deferred tax assets and liabilities are held in various national and international jurisdictions that do not allow right of offset. Accordingly, our presentation of deferred taxes on our consolidated balance sheets is split between jurisdictions that show a net deferred tax asset and a net deferred tax liability. Our net deferred tax position is summarized below:
|  | As of September 30,
(in thousands) |  | 2020 |  | 2019
Balance of tax jurisdictions with net deferred tax assets |  | $ | 1,915 |  |  | $ | 186 |
Balance of tax jurisdictions with net deferred tax liabilities |  | (24,737) |  |  | (46,560) |
Net deferred tax liabilities |  | $ | (22,822) |  |  | $ | (46,374) |
Schedule of reconciliation of the beginning and ending amount of gross unrecognized tax benefits | The reconciliation of the beginning and ending amount of gross unrecognized tax benefits was as follows:
|  | Year ended September 30,
(in thousands) |  | 2020 |  | 2019 |  | 2018
Balance at beginning of year |  | $ | 3,001 |  |  | $ | 721 |  |  | $ | 633 |
Increases for tax positions taken in current year |  | 770 |  |  | 2,280 |  |  | 88 |
Decreases for tax positions taken in current year |  | (1,973) |  |  | — |  |  | — |
Balance at end of year |  | $ | 1,798 |  |  | $ | 3,001 |  |  | $ | 721 |

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- Definition Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32639-109319 + Details
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- Definition Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32537-109319 + Details
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- Definition Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32687-109319 + Details
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- Definition Tabular disclosure for tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15A -URI http://asc.fasb.org/extlink&oid=84230637&loc=SL6600010-109319 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32718-109319 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 19 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32840-109319 + Details
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