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Income Taxes (Tables) | 12 Months Ended
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May 31, 2020
Disclosure Text Block [Abstract] |
Income Before Income Taxes | Income before income taxes by source consists of the following amounts:
|  | Year ended May 31 |
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
U.S. |  | $ | 62,329 |  |  | $ | 58,479 |  |  | $ | 62,310 |
Foreign |  |  | 9,976 |  |  |  | 14,480 |  |  |  | 11,155 |
|  | $ | 72,305 |  |  | $ | 72,959 |  |  | $ | 73,465 |
Provision for Income Taxes | The provision for income taxes consists of the following:
|  | Year ended May 31 |
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Current |  |  |  |  |  |  |  |  |  |  |  |
Domestic |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 6,886 |  |  | $ | 7,173 |  |  | $ | 9,715 |
Uncertain tax provision |  |  | 269 |  |  |  | 13 |  |  |  | (963 | )
State |  |  | 1,262 |  |  |  | 1,265 |  |  |  | 1,377 |
Foreign |  |  | 2,475 |  |  |  | 3,758 |  |  |  | 3,066 |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Domestic |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 1,964 |  |  |  | 1,031 |  |  |  | (1,981 | )
State |  |  | 195 |  |  |  | 98 |  |  |  | (355 | )
Foreign |  |  | (221 | ) |  |  | (555 | ) |  |  | (609 | )
Provision for Income Taxes |  | $ | 12,830 |  |  | $ | 12,783 |  |  | $ | 10,250 |
Reconciliation of Income Taxes Computed at U.S. Federal Statutory Tax Rate to Income Tax Expense | The reconciliation of income taxes computed at the U.S. federal statutory tax rate to income tax expense is as follows:
|  | Year ended May 31 |
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Tax at U.S. statutory rate |  | $ | 15,184 |  |  | $ | 15,321 |  |  | $ | 21,459 |
Permanent differences |  |  | 360 |  |  |  | (56 | ) |  |  |  |
Section 199 domestic production deduction |  |  | — |  |  |  | — |  |  |  | (1,167 | )
Global intangible low-taxed income (GILTI) |  |  | 438 |  |  |  | 840 |  |  |  | — |
Foreign derived intangible income deduction (FDII) |  |  | (1,120 | ) |  |  | (1,531 | ) |  |  | — |
Foreign rate differential |  |  | (182 | ) |  |  | 495 |  |  |  | (461 | )
Subpart F income |  |  | 634 |  |  |  | 842 |  |  |  | 816 |
Tax benefits on stock-based compensation |  |  | (1,998 | ) |  |  | (2,586 | ) |  |  | (4,816 | )
Changes in tax contingencies - Increase/(Release) |  |  | 269 |  |  |  | 13 |  |  |  | (1,035 | )
Provision for state income taxes, net of federal benefit |  |  | 1,412 |  |  |  | 1,251 |  |  |  | 975 |
Remeasurement of deferred taxes |  |  | — |  |  |  | — |  |  |  | (6,022 | )
Transition tax on foreign earnings and profits |  |  | — |  |  |  | — |  |  |  | 1,223 |
Tax c redits |  |  | (1,417 | ) |  |  | (1,726 | ) |  |  | (1,151 | )
Other |  |  | (750 | ) |  |  | (80 | ) |  |  | 429 |
Tax Expense |  | $ | 12,830 |  |  | $ | 12,783 |  |  | $ | 10,250 |
Significant Components of Deferred Income Tax Liabilities and Assets | Significant components of our deferred income tax liabilities and assets are as follows:
|  | Year ended May 31 |
(in thousands) |  | 2020 |  |  | 2019 |
Deferred income tax liabilities |  |  |  |  |  |  |  |
Indefinite and long-lived assets |  | $ | (20,867 | ) |  | $ | (18,963 | )
Prepaid expenses |  |  | (795 | ) |  |  | (586 | )
|  |  | (21,662 | ) |  |  | (19,549 | )
Deferred income tax assets |  |  |  |  |  |  |  |
Stock o ptions |  |  | 1,479 |  |  |  | 1,497 |
Inventories and accounts receivable |  |  | 1,336 |  |  |  | 1,315 |
Tax loss carryforwards |  |  | 484 |  |  |  | 417 |
Accrued expenses and other |  |  | 657 |  |  |  | 1,109 |
Less: Valuation a llowance |  |  | (419 | ) |  |  | (407 | )
|  |  | 3,537 |  |  |  | 3,931 |
Net deferred income tax liabilities |  | $ | (18,125 | ) |  | $ | (15,618 | )
Summary of net operating loss carryforwards | The Company has the following net operating loss carryforwards:
|  | As of |  |  |  |
Jurisdiction |  | May 31, 2020 |  |  | Expiry |
U.S. |  | $ | 408 |  |  |  | 2037 to indefinite |
Foreign |  |  | 1,354 |  |  |  | 2024 to 2039 |
|  | $ | 1,762 |  |  |  |  |
Sumary of reconciliation of our tax contingencies | The reconciliation of our tax uncertainties is as follows:
|  | Year ended May 31 |
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Beginning balance |  | $ | 611 |  |  | $ | 598 |  |  | $ | 1,633 |
Increase/(decrease) related to prior periods |  |  | 56 |  |  |  | (106 | ) |  |  | (1,157 | )
Increase to current period |  |  | 213 |  |  |  | 119 |  |  |  | 122 |
Ending balance |  | $ | 880 |  |  | $ | 611 |  |  | $ | 598 |

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- Definition Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32639-109319 + Details
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- Definition Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32537-109319 + Details
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- Definition Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32687-109319 + Details
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- Definition Tabular disclosure for tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15A -URI http://asc.fasb.org/extlink&oid=84230637&loc=SL6600010-109319 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32718-109319 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 19 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32840-109319 + Details
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