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Income Taxes | 12 Months Ended
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Jun. 30, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | NOTE 5 - Income Taxes The provision for income taxes is comprised of the following (in thousands):
|  | For the Years Ended June 30, |
|  | 2016 |  | 2015 |
Current income taxes: |  |  |  |  |  |  |
Federal |  | $ | (31) |  | $ | (49) |
State |  |  | 27 |  |  | 35 |
|  |  | (4) |  |  | (14) |
Deferred income tax provision |  |  | 375 |  |  | 230 |
Provision for income taxes |  | $ | 371 |  | $ | 216 |
A reconciliation of the U.S. Federal statutory income tax rate to our actual effective tax rate on earnings before income taxes is as follows for the years ended June 30, (dollars in thousands):
|  | 2016 |  |  | 2015 |
|  | Amount |  | % of Pre-tax Income |  |  | Amount |  |  | % of Pre-tax Income |
Tax at Federal statutory rate |  | $ | 2,089 |  |  | 34.0 | % |  | $ | 1,721 |  |  | 34.0 | %
Increases (decreases) in taxes resulting from: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Meals and entertainment |  |  | 61 |  |  | 1.0 | % |  |  | 66 |  |  | 1.3 | %
State income taxes, net of Federal income tax benefit |  |  | 20 |  |  | 0.3 | % |  |  | 21 |  |  | 0.4 | %
Foreign source income not subject to tax |  |  | (1,278) |  |  | (20.8) | % |  |  | (1,069) |  |  | (21.1) | %
R&D Credit refund |  |  | (415) |  |  | (6.8) | % |  |  | (328) |  |  | (6.5) | %
Undistributed foreign earnings |  |  | (90) |  |  | (1.4) | % |  |  | (93) |  |  | (1.8) | %
Other, net |  |  | (16) |  |  | (0.3) | % |  |  | (102) |  |  | (2.0) | %
Effective tax rate |  | $ | 371 |  |  | 6.0 | % |  | $ | 216 |  |  | 4.3 | %
Deferred tax assets and deferred tax liabilities at June 30, 2016 and 2015 are as follows (in thousands):
|  | Current Deferred Tax Assets (Liabilities) |  |  | Long-term Deferred Tax Assets (Liabilities) |
|  | 2016 |  | 2015 |  |  | 2016 |  | 2015 |
Accounts receivable |  | $ | 26 |  | $ | 36 |  |  | $ | — |  | $ | — |
Inventories |  |  | 364 |  |  | 533 |  |  |  | 200 |  |  | 261 |
Accrued Liabilities |  |  | 313 |  |  | 311 |  |  |  | 87 |  |  | 86 |
Stock based compensation expense |  |  | — |  |  | — |  |  |  | 154 |  |  | 147 |
Goodwill |  |  | — |  |  | — |  |  |  | (14) |  |  | 214 |
R&D credit |  |  | — |  |  | — |  |  |  | 1,214 |  |  | 804 |
Property, plant and equipment |  |  | — |  |  | — |  |  |  | (503) |  |  | (512) |
Other deferred tax liabilities |  |  | — |  |  | — |  |  |  | (702) |  |  | (366) |
|  |  | 703 |  |  | 880 |  |  |  | 436 |  |  | 634 |
Valuation allowance |  |  | — |  |  | — |  |  |  | — |  |  | — |
Net deferred tax assets |  | $ | 703 |  | $ | 880 |  |  | $ | 436 |  | $ | 634 |
The Company has identified the United States and New York State as its major tax jurisdictions. The fiscal 2012 and forward years are still open for examination. During the year ending June 30, 2016 the Company increased its reserve for uncertain income tax positions by $46,000. The Company’s practice is to recognize interest and penalties related to income tax matters in income tax expense and accrued income taxes. As of June 30, 2016, the Company had accrued interest totaling $0 and $148,000 of unrecognized net tax benefits that, if recognized, would favorably affect the Company’s effective income tax rate in any future period. The Company uses the flow through method to account for investment tax credits earned on eligible research and development expenditures. Under this method, the investment tax credits are recognized as a reduction to income tax expense. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):
|  | Tax |  | Interest |  | Total |
Balance of gross unrecognized tax benefits as of July 1, 2015 |  | $ | 102 |  | $ | — |  | $ | 102 |
Increases to unrecognized tax benefits resulting from the generation of additional R&D credits |  |  | 46 |  |  | — |  |  | 46 |
Balance of gross unrecognized tax benefits as of June 30, 2016 |  | $ | 148 |  | $ | — |  | $ | 148 |
The Company plans to permanently reinvest a substantial portion of its foreign earnings and as such has not provided US corporate taxes on the permanently reinvested earnings. As of June 30, 2016, the Company had approximately $7.6 million of undistributed earnings of foreign subsidiaries.

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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