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Income Taxes
6 Months Ended
Dec. 31, 2017
Income Tax Disclosure [Abstract]  
Income Taxes
8.      Income Taxes
The United States government enacted comprehensive income tax legislation (the “Tax Act”) in December 2017. The Tax Act makes broad and complex changes to United States income tax law and includes numerous elements that affect the Company, including a reduced federal corporate income tax rate and changes to business-related exclusions, deductions and credits. The Tax Act also has consequences related to our international operations.
Our consolidated financial statements as of December 31, 2017, and for the three and six months then ended, reflect the estimated effects of the Tax Act, including:
•         a $2,450 provision for income taxes and reduction in deferred tax assets for the remeasurement of deferred tax assets and liabilities to reflect the reduced income tax rate;
•         a $4,249 provision for income taxes and increase in current and long-term liabilities to reflect the one-time mandatory toll charge on the deemed repatriation of undistributed earnings of foreign subsidiaries;
•         an update to the provision for income taxes to reflect a statutory 28.1% weighted-average federal income tax rate and other elements of the Tax Act in effect for our fiscal year ending June 30, 2018. The statutory federal income tax rate will be 21.0% for our fiscal year beginning July 1, 2018.
We have recorded reasonable estimates of the effects of the Tax Act; however, we have not completed the analysis of all necessary information, including our assessment of a potential provision for Global Intangible Low-Taxed Income wherein taxes on certain foreign income are imposed in excess of a deemed return on tangible assets of foreign corporations. As such, we have recorded provisional amounts and may adjust such amounts as we complete our analysis. The final financial statement effects of the Tax Act may differ from the provisional amounts, possibly materially, due to, among other things, changes in interpretations, legislative action to address questions that arise because of the Tax Act, changes in accounting standards for income taxes or related interpretations, or any updates or changes to estimates we have utilized.
Our consolidated financial statements as of December 31, 2017, and for the three and six months then ended, also reflect the following discrete income tax related items:
•         a $527 provision for income taxes and a reduction in accumulated other comprehensive income (“AOCI”). The provision was necessary to eliminate the income taxes remaining in AOCI after all related foreign currency derivatives had matured and were completely cleared from AOCI;
•         a $1,000 provision for income taxes and a reduction in deferred tax assets for the remeasurement of deferred tax assets to reflect a reduced income tax rate in certain international jurisdictions.
•         a $387 net provision and a $2,359 benefit from the exercise of employee stock options for the three and six months ended December 31, 2017, respectively. The net provision from the exercise of employee stock options included a $460 provision to adjust the benefit recognized in the three months ended September 30, 2017, to the reduced income tax rate.