Note 11 — Income Taxes

The Company’s quarterly provision for income taxes is determined by estimating an annual effective tax rate. This estimate may fluctuate throughout the year as new information becomes available affecting its underlying assumptions. The tax effect of unusual or infrequent transactions that occurred during the reporting period is calculated separately and added to the amount of tax estimated using the annual effective tax rate discussed above. All earnings from the Company’s subsidiaries are not considered to be permanently reinvested. Accordingly, the Company provides withholding and U.S. taxes on all unremitted foreign earnings.

The $1.7 million income tax benefit recorded during the first nine months of 2016, was attributable to (1) the Company’s net operating losses reported by its foreign operations principally due to an acceleration of stock-based compensation during the first quarter of 2016, and (2) a reduction in its foreign withholding taxes in connection with the dissolution of one of its foreign subsidiaries effective April 1, 2016. During the nine months ended October 2, 2015, the Company recorded an income tax provision of $114,000, primarily benefiting from the mix of pre-tax earnings in lower- and zero- rate foreign jurisdictions. There are no unrecognized tax benefits related to uncertain tax positions taken by the Company.