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Income Tax
 6 Months Ended
Jun. 30, 2012
Income Tax [Abstract]  
Income Tax

Note 7 — Income Tax

During the quarter ended June 30, 2012, the Company’s deferred tax assets increased by $15.8 million to $34.3 million primarily due to non-cash charges related to goodwill impairment and severance. However, due to the cumulative losses it has experienced, the recoverability of substantially all of the deferred tax assets is uncertain. Therefore, the Company recorded an additional valuation allowance of $33.5 million resulting in a net tax expense of $19.5 million for the quarter.

Income tax as a percentage of pre-tax loss for the three months ended June 30, 2012 was negative 46.7% compared to an effective tax rate of 31.3% for the three months ended June 30, 2011. Exclusive of the effect of the increase in the tax valuation allowance, the effective income tax rate would have been 33.7%.

Income tax as a percentage of pre-tax loss for the six months ended June 30, 2012 was negative 41.1% compared to a tax rate of 35.1% for the six months ended June 30, 2011. Exclusive of the effect of the increase in the tax valuation allowances, the effective income tax rate would have been 34.0%.

The Company and its subsidiaries are subject to U.S. Federal income tax as well as income tax of multiple state and foreign jurisdictions. As of June 30, 2012, the Company is subject to U.S. Federal income tax examinations for the years 2009 and 2010, and income tax examinations from various other jurisdictions for the years 2006 through 2010.

Earnings from the Company’s foreign subsidiaries are considered to be indefinitely reinvested. A distribution of these non-U.S. earnings in the form of dividends or otherwise would subject the Company to both U.S. Federal and state income taxes, as adjusted for tax credits and foreign withholding taxes.