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Income Taxes
 9 Months Ended
Oct. 31, 2012
Income Taxes [Abstract]  
INCOME TAXES

NOTE 12 - INCOME TAXES

The Company’s income tax expense amounts related to continuing operations for the nine months ended October 31, 2012 and 2011 differed from the expected income tax expense amounts computed by applying the federal corporate income tax rate (35% for 2012; 34% for 2011) to the income from continuing operations before income taxes as shown in the table below.

 

                 
    Nine Months Ended October 31,  
    2012     2011  

Computed expected income tax expense

   $ 9,093,000     $ 2,458,000  

State income taxes, net of federal tax benefit

     1,073,000       373,000  

Permanent deductions, net

     (648,000 )      (257,000 ) 

Other adjustments, net

     223,000       84,000  
   

 

 

    

 

 

  
    $ 9,741,000     $ 2,658,000  
   

 

 

    

 

 

  

For the nine months ended October 31, 2012 and 2011, the favorable tax effects of permanent differences relate primarily to the tax benefit of the domestic manufacturing deduction for the period. Other adjustments for the nine months ended October 31, 2012 includes primarily a federal return to provision adjustment in the amount of $116,000.

As of October 31, 2012, the amount presented in the condensed consolidated balance sheet for accrued expenses included accrued income taxes of approximately $869,000. As of January 31, 2012, the amount presented in the condensed consolidated balance sheet for prepaid expenses and other current assets included prepaid income taxes of approximately $1,602,000.

The Company’s condensed consolidated balance sheets as of October 31, 2012 and January 31, 2012 included net deferred tax assets in the amounts of approximately $1,094,000 and $1,529,000, respectively, resulting from future deductible temporary differences. At this time, based substantially on the strong earnings performance of the Company’s power industry services business segment, management believes that it is more likely than not that the Company will realize benefit for its deferred tax assets.

The Company is subject to income taxes in the United States of America and in various state jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to federal, state and local income tax examinations by tax authorities for its fiscal years ended on or before January 31, 2008.