XML 62 R22.htm IDEA: XBRL DOCUMENT v2.4.0.8
Income Taxes (Notes)
 12 Months Ended
Dec. 31, 2013
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

The components of income before income taxes are as follows:

    
 
2013
 
2012
 
2011
Domestic
$
125,772

 
$
123,691

 
$
117,497

Foreign
83,179

 
60,496

 
41,295

 
$
208,951

 
$
184,187

 
$
158,792



The income tax provision (benefit) consists of the following:
    
 
2013
 
2012
 
2011
Current:
 
 
 
 
 
Federal
$
41,334

 
$
41,280

 
$
43,953

State and local
11,265

 
10,319

 
8,560

Foreign
14,385

 
11,035

 
6,814

 
66,984

 
62,634

 
59,327

Deferred:
 
 
 
 
 
Federal
8,815

 
2,272

 
1,588

State and local
(667
)
 
(396
)
 
676

       Foreign
534

 
113

 
—

 
8,682

 
1,989

 
2,264

 
$
75,666

 
$
64,623

 
$
61,591


Note N - Income Taxes (continued)

A reconciliation between taxes computed at the federal statutory rate and the effective tax rate is as follows:
    
 
December 31,
 
2013
 
2012
 
2011
Income taxes at federal statutory rate
35.0
 %
 
35.0
 %
 
35.0
 %
Effects of foreign operations
(1.7
)
 
(3.3
)
 
—

State and local income taxes - net of federal income tax benefit
3

 
3.4

 
3.9

Nondeductible items
0.1

 
0.1

 
0.3

Valuation allowance (reversal)


 
(0.3
)
 
(0.4
)
Other
(0.2
)
 
0.2

 
—

Effective rate
36.2
 %
 
35.1
 %
 
38.8
 %


The Company applies the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.

In accordance with accounting guidance, the Company has opted to classify interest and penalties that would accrue according to the provisions of relevant tax law as income tax expense on the Consolidated Statements of Income. The Company determines the amount of interest expense to be recognized by applying the applicable statutory rate of interest to the difference between the tax position recognized and the amount previously taken or expected to be taken on a tax return. The Company's tax years 2010 through 2013 remain open to examination by most taxing authorities. The Company has no unrecognized tax benefits recorded as of the year ended December 31, 2013.
Note N - Income Taxes (continued)

The components of deferred tax assets and liabilities are as follows:    
 
December 31,
 
2013
 
2012
Current deferred tax assets (liabilities):
 
 
 
Receivable allowances
$
8,024

 
$
9,005

Inventory
1,932

 
1,588

Unrealized (gain) loss
(23
)
 
58

Accrued expenses
499

 
496

Other
1,835

 
(74
)
Gross current deferred tax asset
12,267

 
11,073

 
 
 
 
Non-current deferred tax assets (liabilities):
 
 
 
Depreciation and amortization
(5,033
)
 
(1,982
)
Deferred compensation
10,827

 
8,200

Unremitted earnings of foreign subsidiaries
(20,748
)
 
(10,224
)
Deferred rent
3,741

 
2,991

Amortization of goodwill
(3,293
)
 
(3,097
)
 Unrealized loss (gain)
1,226

 
(1,073
)
Other
56

 
68

 
(13,224
)
 
(5,117
)
Deferred tax (liabilities) assets
$
(957
)
 
$
5,956



The Company's consolidated financial statements provide for any related tax liability on amounts that may be repatriated from foreign operations, aside from undistributed earnings of certain of the Company's foreign subsidiaries that are intended to be indefinitely reinvested in operations outside the U.S. The deferred tax liability of $20,748 and $10,224 for the years ended December 31, 2013 and 2012, respectively, reflects the amounts that may be repatriated from foreign operations. A portion of the amount established in the year ended December 31, 2012 was based on the finalization of the purchase accounting in 2012 of Topline. The total amount of indefinitely reinvested earnings of foreign subsidiaries as of December 31, 2013 and 2012 was $42,750 and $27,100, respectively. Accordingly, no provision has been made for United States income taxes which may become payable if those undistributed earnings of foreign subsidiaries are paid as dividends. Determination of the amount of unrecognized deferred income tax liabilities on these earnings is not practicable because such liability, if any, is subject to many variables and is dependent on circumstances existing if and when remittance occurs.