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Income Taxes | 12 Months Ended
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Apr. 30, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | 9. Income Taxes Income from continuing operations before provision for income taxes was as follows:
|  | Year Ended April 30, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
|  | (in thousands) |
Domestic |  | $ | 34,661 |  |  | $ | 40,736 |  |  | $ | (22,039 | )
Foreign |  |  | 129,039 |  |  |  | 110,226 |  |  |  | 156,379 |
Income before provision for income taxes |  | $ | 163,700 |  |  | $ | 150,962 |  |  | $ | 134,340 |
The provision for domestic and foreign income taxes was as follows:
|  | Year Ended April 30, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
|  | (in thousands) |
Current income taxes: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 16,913 |  |  | $ | 14,336 |  |  | $ | 6,152 |
State |  |  | 4,719 |  |  |  | 4,974 |  |  |  | 9,097 |
Foreign |  |  | 40,646 |  |  |  | 33,965 |  |  |  | 42,091 |
Current provision for income taxes |  |  | 62,278 |  |  |  | 53,275 |  |  |  | 57,340 |
Deferred income taxes: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (5,809 | ) |  |  | (6,862 | ) |  |  | (16,211 | )
State |  |  | (5,025 | ) |  |  | (784 | ) |  |  | (7,682 | )
Foreign |  |  | (3,306 | ) |  |  | (1,684 | ) |  |  | (3,903 | )
Deferred benefit for income taxes |  |  | (14,140 | ) |  |  | (9,330 | ) |  |  | (27,796 | )
Total provision for income taxes |  | $ | 48,138 |  |  | $ | 43,945 |  |  | $ | 29,544 |
The reconciliation of the statutory federal income tax rate to the effective consolidated tax rate is as follows:
|  | Year Ended April 30, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
U.S. federal statutory income tax rate |  |  | 21.0 | % |  |  | 21.0 | % |  |  | 21.0 | %
State tax, net of federal effect |  |  | 1.0 |  |  |  | 2.2 |  |  |  | 1.1 |
Foreign tax rates differential |  |  | 4.5 |  |  |  | 4.5 |  |  |  | 5.0 |
Non-deductible officers compensation |  |  | 2.3 |  |  |  | 0.5 |  |  |  | 1.1 |
Excess tax expense (benefit) on stock-based compensation |  |  | 0.8 |  |  |  | (1.0 | ) |  |  | (3.1 | )
Change in valuation allowance |  |  | 0.3 |  |  |  | — |  |  |  | (2.0 | )
COLI increase, net |  |  | (1.7 | ) |  |  | (0.9 | ) |  |  | (1.0 | )
Change in uncertain tax positions |  |  | 1.1 |  |  |  | 0.2 |  |  |  | 0.1 |
Other |  |  | 0.1 |  |  |  | 2.6 |  |  |  | (0.2 | )
Effective income tax rate |  |  | 29.4 | % |  |  | 29.1 | % |  |  | 22.0 | %
Components of deferred tax assets and liabilities were as follows:
|  | April 30, |
|  | 2021 |  |  | 2020 |
|  | (in thousands) |
Deferred tax assets: |  |  |  |  |  |  |  |
Deferred compensation |  | $ | 107,834 |  |  | $ | 86,479 |
Operating lease liability |  |  | 34,183 |  |  |  | 37,934 |
Loss carryforwards |  |  | 39,704 |  |  |  | 27,845 |
Reserves and accruals |  |  | 16,393 |  |  |  | 14,211 |
Allowance for doubtful accounts |  |  | 4,885 |  |  |  | 4,029 |
Other |  |  | — |  |  |  | 2,703 |
Gross deferred tax assets |  |  | 202,999 |  |  |  | 173,201 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Operating lease, right-of-use, assets |  |  | (27,777 | ) |  |  | (29,998 | )
Intangibles and Goodwill |  |  | (26,570 | ) |  |  | (29,006 | )
Property and equipment |  |  | (20,590 | ) |  |  | (22,332 | )
Prepaid expenses |  |  | (23,928 | ) |  |  | (19,567 | )
Marketable Securities |  |  | (7,003 | ) |  |  | — |
Other |  |  | (2,684 | ) |  |  | — |
Gross deferred tax liabilities |  |  | (108,552 | ) |  |  | (100,903 | )
Valuation allowances |  |  | (25,173 | ) |  |  | (17,875 | )
Net deferred tax asset |  | $ | 69,274 |  |  | $ | 54,423 |
Deferred tax assets are reduced by a valuation allowance if it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. Management believes uncertainty exists regarding the realizability of certain deferred tax assets and has, therefore, established a valuation allowance for deferred tax assets that are not more-likely-than-not to be realized. Realization of the deferred tax asset is dependent on the Company generating enough taxable income of the appropriate nature in future years. Although realization is not assured, management believes that it is more likely than-not that the net deferred tax assets will be realized. Deferred tax assets and deferred tax liabilities are presented net on the consolidated balance sheets by tax jurisdiction. As of April 30, 2021, the Company had U.S. federal net operating loss carryforwards of $2.2 million, which the Company anticipates will be fully utilized by fiscal 2028. The Company has state net operating loss carryforwards of $40.3 million, which, if unutilized, will begin to expire in fiscal 2022. The Company also has foreign net operating loss carryforwards of $159.3 million, which, if unutilized, will begin to expire in fiscal 2022. We continue to consider approximately $571.3 million of undistributed earnings of our foreign subsidiaries to be indefinitely reinvested, and, accordingly, have provided no taxes on such earnings other than the Transition Tax. While we do not anticipate a need to repatriate funds to the U.S. to satisfy domestic liquidity needs, we review our cash positions regularly and, to the extent we determine that all or a portion of our foreign earnings are not indefinitely reinvested, we provide additional taxes, if applicable, including foreign withholding taxes and U.S. state income taxes. The Company elected to treat taxes due on future U.S. inclusions in taxable income related to Global Intangible Low-Taxed Income as an expense when incurred (the “period cost method”) as opposed to factoring such amounts in the Company’s measurement of its deferred taxes (the “deferred method”). The Company and its subsidiaries file federal and state income tax returns in the U.S. as well as in foreign jurisdictions. These income tax returns are subject to audit by the Internal Revenue Service (the “IRS”) and various state and foreign tax authorities. Currently, income tax returns of the Company’s subsidiaries are under audit in Brazil, Germany, Switzerland, Japan and India. The Company’s income tax returns are not otherwise under examination in any material jurisdictions. The statute of limitations varies by jurisdiction in which the Company operates. With few exceptions, however, the Company’s tax returns for years prior to fiscal 2015 are no longer open to examination by tax authorities (including U.S. federal, state and foreign). Unrecognized tax benefits are the differences between the amount of benefits of tax positions taken, or expected to be taken, on a tax return and the amount of benefits recognized for financial reporting purposes. As of April 30, 2021, the Company had a liability of $10.0 million for unrecognized tax benefits. A reconciliation of the beginning and ending balances of the unrecognized tax benefits is as follows:
|  | Year Ended April 30, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
|  | (in thousands) |
Unrecognized tax benefits, beginning of year |  | $ | 6,037 |  |  | $ | 7,794 |  |  | $ | 3,674 |
Settlement with tax authority |  |  | — |  |  |  | (1,767 | ) |  |  | (1,771 | )
Additions based on tax positions related to the current year |  |  | 1,716 |  |  |  | 10 |  |  |  | 1,775 |
Additions based on tax positions related to prior years |  |  | 2,201 |  |  |  | — |  |  |  | 4,116 |
Unrecognized tax benefits, end of year |  | $ | 9,954 |  |  | $ | 6,037 |  |  | $ | 7,794 |
The full amount of unrecognized tax benefits would impact the effective tax rate if recognized. In the next 12 months, it is reasonably possible that the Company’s unrecognized tax benefits could change due to the resolution of certain tax matters either because the tax positions are sustained on audit or the Company agrees to their disallowance. These resolutions could reduce the Company’s liability for unrecognized tax benefits by approximately $1.3 million. The Company does not expect a change in the amount of unrecognized tax benefits to have a material financial statement impact. The Company classifies interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes. The Company had accruals of $0.9 million, $0.6 million, and $0.4 million for interest related to unrecognized tax benefits as of April 30, 2021, 2020, and 2019 respectively. The Company had an accrual of $0.5 million as of April 30, 2021, for penalties related to unrecognized tax benefits and no accrual for penalties related to unrecognized tax benefits in fiscal 2020 and 2019. The Company recognized tax expense of $0.8 million, $0.2 million, and $0.1 million for interest and penalties related to unrecognized tax benefits during fiscal 2021, 2020, and 2019, respectively.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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