XML 37 R22.htm IDEA: XBRL DOCUMENT
v3.22.2

Income Taxes | 12 Months Ended
--- | ---
Apr. 30, 2022
Income Taxes [Abstract] |
Income Taxes | Note 13 –Income Taxes The provisions for income taxes were as follows:
|  | For the Years Ended April 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
Current Provision |  |  |  |  |  |  |  |  |
US – Federal |  | $ | (324 | ) |  | $ | (6,631 | ) |  | $ | 1,145 |
International |  |  | 57,905 |  |  |  | 43,269 |  |  |  | 37,494 |
State and local |  |  | 221 |  |  |  | 1,359 |  |  |  | 172 |
Total current provision |  | $ | 57,802 |  |  | $ | 37,997 |  |  | $ | 38,811 |
Deferred provision (benefit) |  |  |  |  |  |  |  |  |  |  |  |
US – Federal |  | $ | (9,793 | ) |  | $ | (11,996 | ) |  | $ | (8,476 | )
International |  |  | 15,882 |  |  |  | 1,175 |  |  |  | (15,022 | )
State and local |  |  | (2,539 | ) |  |  | 480 |  |  |  | (4,118 | )
Total deferred provision (benefit) |  | $ | 3,550 |  |  | $ | (10,341 | ) |  | $ | (27,616 | )
Total provision |  | $ | 61,352 |  |  | $ | 27,656 |  |  | $ | 11,195 |
International and United States pretax income (loss) were as follows:
|  | For the Years Ended April 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
International |  | $ | 256,456 |  |  | $ | 202,490 |  |  | $ | 104,185 |
United States |  |  | (46,795 | ) |  |  | (26,578 | ) |  |  | (167,277 | )
Total |  | $ | 209,661 |  |  | $ | 175,912 |  |  | $ | (63,092 | )
Our effective income tax rate as a percentage of pretax income differed from the US federal statutory rate as shown below:
|  | For the Years Ended April 30, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
US federal statutory rate |  |  | 21.0 | % |  |  | 21.0 | % |  |  | 21.0 | %
Cost of higher taxes on non-US income |  |  | 9.7 | % |  |  | 1.1 | % |  |  | 4.8 | %
Foreign tax credits related to CARES Act carryback and audit |  |  | (11.9 | )% |  |  | 12.3 | % |  |  | — |
Change in valuation allowance |  |  | 11.9 | % |  |  | (12.3 | )% |  |  | — |
State income taxes, net of US federal tax benefit |  |  | (1.0 | )% |  |  | 0.8 | % |  |  | 3.3 | %
US NOL carryback under CARES Act |  |  | — |  |  |  | (8.0 | )% |  |  | — |
Tax credits and related net benefits |  |  | (0.5 | )% |  |  | (0.5 | )% |  |  | (1.1 | )%
Impairment of goodwill and intangibles |  |  | — |  |  |  | — |  |  |  | (42.3 | )%
Other |  |  | 0.1 | % |  |  | 1.3 | % |  |  | (3.4 | )%
Effective income tax rate (benefit) |  |  | 29.3 | % |  |  | 15.7 | % |  |  | (17.7 | )%
The effective tax rate was 29.3% for the year ended April 30, 2022, compared to 15.7% for the year ended April 30, 2021. Our rate for the year ended April 30, 2022 was higher primarily due to an increase in the UK statutory rate from 19% to 25% enacted during our three months ended July 31, 2021, which resulted in a $21.4 million noncash deferred tax expense from the re-measurement of our applicable UK net deferred tax liabilities. In addition, our rate for the year ended April 30, 2021 benefitted by $14 million from the Coronavirus Aid Relief and Economic Security Act (the CARES Act) and certain regulations issued in late July 2020, which enabled us to carryback certain net operating losses (NOLs) to a year with a higher statutory tax rate. Accounting for Uncertainty in Income Taxes: As of April 30, 2022 and April 30, 2021, the total amount of unrecognized tax benefits were $8.6 million and $9.1 million, respectively, of which $0.6 million and $0.7 million represented accruals for interest and penalties recorded as additional tax expense in accordance with our accounting policy. We recorded net interest expense on reserves for unrecognized and recognized tax benefits of $0.2 million in each of the years ended April 30, 2022 and 2021. As of April 30, 2022 and April 30, 2021, the total amounts of unrecognized tax benefits that would reduce our income tax provision, if recognized, were approximately $6.9 million and $7.4 million, respectively. We do not expect any significant changes to the unrecognized tax benefits within the next twelve months. A reconciliation of the unrecognized tax benefits included within the Other long-term liabilities line item on the Consolidated Statements of Financial Position is as follows:
|  | 2022 |  |  | 2021 |
Balance at May 1 |  | $ | 9,144 |  |  | $ | 6,194 |
Additions for current year tax positions |  |  | 947 |  |  |  | 3,626 |
Additions for prior year tax positions |  |  | 16 |  |  |  | 511 |
Reductions for prior year tax positions |  |  | — |  |  |  | (163 | )
Foreign translation adjustment |  |  | (55 | ) |  |  | 57 |
Payments and settlements |  |  | — |  |  |  | (215 | )
Reductions for lapse of statute of limitations |  |  | (1,460 | ) |  |  | (866 | )
Balance at April 30 |  | $ | 8,592 |  |  | $ | 9,144 |
Tax Audits: We file income tax returns in the US and various states and non-US tax jurisdictions. Our major taxing jurisdictions are the United States, United Kingdom, and Germany. Except for one immaterial item, we are no longer subject to income tax examinations for years prior to fiscal year 2014 in the major jurisdictions in which we are subject to tax. Deferred Taxes: Deferred taxes result from temporary differences in the recognition of revenue and expense for tax and financial reporting purposes. We believe that it is more likely than not that the results of future operations will generate sufficient taxable income to realize the net deferred tax assets. The significant components of deferred tax assets and liabilities at April 30 were as follows:
|  | 2022 |  |  | 2021 |
Net operating losses |  | $ | 20,847 |  |  | $ | 19,433 |
Reserve for sales returns and doubtful accounts |  |  | 3,771 |  |  |  | 3,838 |
Accrued employee compensation |  |  | 26,722 |  |  |  | 32,835 |
Foreign and federal credits |  |  | 34,537 |  |  |  | 5,129 |
Other accrued expenses |  |  | 11,636 |  |  |  | 16,092 |
Retirement and post-employment benefits |  |  | 15,769 |  |  |  | 30,039 |
Total gross deferred tax assets |  | $ | 113,282 |  |  | $ | 107,366 |
Less valuation allowance |  |  | (30,000 | ) |  |  | (4,855 | )
Total deferred tax assets |  | $ | 83,282 |  |  | $ | 102,511 |
Prepaid expenses and other current assets |  | $ | (2,684 | ) |  | $ | (459 | )
Unremitted foreign earnings |  |  | (2,685 | ) |  |  | (2,485 | )
Intangible and fixed assets |  |  | (249,215 | ) |  |  | (260,559 | )
Total deferred tax liabilities |  | $ | (254,584 | ) |  | $ | (263,503 | )
Net deferred tax liabilities |  | $ | (171,302 | ) |  | $ | (160,992 | )
Reported As |  |  |  |  |  |  |  |
Deferred tax assets |  | $ | 8,763 |  |  | $ | 11,911 |
Deferred tax liabilities |  |  | (180,065 | ) |  |  | (172,903 | )
Net Deferred Tax Liabilities |  | $ | (171,302 | ) |  | $ | (160,992 | )
The increase in net deferred tax liabilities was due to the decrease in net deferred tax assets, which was primarily attributable to a decrease in our retirement and post-employment benefits, partially offset by an increase in our Net operating losses and foreign and federal credits net of applicable valuation allowances. The increase in our deferred tax liabilities from the revaluation of our deferred tax liabilities related to the UK rate change from 19% to 25% was largely offset by a decrease in our deferred tax liabilities for intangibles and fixed assets. We have concluded that after valuation allowances, it is more likely than not that we will realize substantially all of the net deferred tax assets at April 30, 2022. In assessing the need for a valuation allowance, we take into account related deferred tax liabilities and estimated future reversals of existing temporary differences, future taxable earnings and tax planning strategies to determine which deferred tax assets are more likely than not to be realized in the future. Changes to tax laws, statutory tax rates and future taxable earnings can have an impact on our valuation allowances. We have provided a $30.0 million valuation allowance based primarily on the uncertainty of utilizing the tax benefits related to our deferred tax assets for foreign tax credits. As of April 30, 2022, we have apportioned state net operating loss carryforwards totaling approximately $129 million, with a tax effected value of $7.1 million net of federal benefits. Our state and federal NOLs and credits, to the extent they expire, expire in various amounts over 2 to 20 years. Since April 30, 2018, we no longer intend to permanently reinvest earnings outside the US. We have recorded a $2.7 million liability related to the estimated taxes that would be incurred upon repatriating certain non-US earnings.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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=121826272&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=122134291&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=121826272&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=122134291&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=121826272&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 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration