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Income taxes (Tables)

12 Months Ended

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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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.

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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.

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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.

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Tabular disclosure of income before income tax between domestic and foreign jurisdictions.

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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.

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