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Note F - Income Taxes | 12 Months Ended
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Dec. 31, 2016
Notes to Financial Statements |
Income Tax Disclosure [Text Block] | Note F – Income Taxes The components of income before income taxes are:
|  | 2016 |  |  | 2015 |  |  | 2014 |
United States |  | $ | 33,101 |  |  | $ | 35,391 |  |  | $ | 49,692 |
Foreign countries |  |  | 3,381 |  |  |  | 1,875 |  |  |  | 4,042 |
Total |  | $ | 36,482 |  |  | $ | 37,266 |  |  | $ | 53,734 |
The components of income tax expense are:
|  | 2016 |  |  | 2015 |  |  | 2014 |
Current expense: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 6,960 |  |  | $ | 11,465 |  |  | $ | 16,638 |
Foreign |  |  | 547 |  |  |  | 292 |  |  |  | 946 |
State and local |  |  | 581 |  |  |  | 963 |  |  |  | 1,376 |
|  |  | 8,088 |  |  |  | 12,720 |  |  |  | 18,960 |
Deferred expense (benefit): |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 3,429 |  |  |  | (443 | ) |  |  | (1,181 | )
Foreign |  |  | (184 | ) |  |  | (112 | ) |  |  | (114 | )
State and local |  |  | 266 |  |  |  | (8 | ) |  |  | (72 | )
|  |  | 3,511 |  |  |  | (563 | ) |  |  | (1,367 | )
Income tax expense |  | $ | 11,599 |  |  | $ | 12,157 |  |  | $ | 17,593 |
The reconciliation between income tax expense and the amount computed by applying the statutory federal income tax rate of 35% to income before income taxes is:
|  | 2016 |  |  | 2015 |  |  | 2014 |
Income taxes at statutory rate |  | $ | 12,769 |  |  | $ | 13,043 |  |  | $ | 18,807 |
State and local income taxes, net of federal tax benefit |  |  | 576 |  |  |  | 680 |  |  |  | 674 |
Research and development tax credits |  |  | (371 | ) |  |  | (380 | ) |  |  | (371 | )
Domestic production activities deduction |  |  | (822 | ) |  |  | (964 | ) |  |  | (1,324 | )
Lower foreign taxes differential |  |  | (820 | ) |  |  | (476 | ) |  |  | (583 | )
Uncertain tax positions |  |  | (93 | ) |  |  | 26 |  |  |  | 53 |
Valuation allowance |  |  | - |  |  |  | (59 | ) |  |  | 174 |
Other |  |  | 360 |  |  |  | 287 |  |  |  | 163 |
Income tax expense |  | $ | 11,599 |  |  | $ | 12,157 |  |  | $ | 17,593 |
The Company made income tax payments of $7.8 million, $13.5 million, and $19.4 million in 2016, 2015, and 2014, respectively. Deferred income tax assets and liabilities consist of:
|  | 2016 |  |  | 2015 |  |  | 2014 |
Deferred tax assets: |  |  |  |  |  |  |  |  |  |  |  |
Inventories |  | $ | 721 |  |  | $ | 1,664 |  |  | $ | 1,030 |
Accrued liabilities |  |  | 3,139 |  |  |  | 2,450 |  |  |  | 2,538 |
Postretirement health benefits obligation |  |  | 7,449 |  |  |  | 7,547 |  |  |  | 7,602 |
Pension |  |  | - |  |  |  | 3,443 |  |  |  | 1,649 |
Deferred revenue |  |  | - |  |  |  | - |  |  |  | 1,267 |
Other |  |  | 879 |  |  |  | 292 |  |  |  | 550 |
Total deferred tax assets |  |  | 12,188 |  |  |  | 15,396 |  |  |  | 14,636 |
Valuation allowance |  |  | (277 | ) |  |  | (277 | ) |  |  | (336 | )
Net deferred tax assets |  |  | 11,911 |  |  |  | 15,119 |  |  |  | 14,300 |
Deferred tax liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | (16,119 | ) |  |  | (18,059 | ) |  |  | (17,711 | )
Pension |  |  | (3,017 | ) |  |  | - |  |  |  | - |
Total deferred tax liabilities |  |  | (19,136 | ) |  |  | (18,059 | ) |  |  | (17,711 | )
Net deferred tax liabilities |  | $ | (7,225 | ) |  | $ | (2,940 | ) |  | $ | (3,411 | )
The Company has a valuation allowance of $277,000 as of December 31, 2016 and 2015 against certain of its deferred tax assets. ASC 740 requires that a valuation allowance be recorded against deferred tax assets when it is more likely than not that some or all of a Company’s deferred tax assets will not be realized based on available positive and negative evidence. Total unrecognized tax benefits were $492,000 and $567,000 at December 31, 2016 and 2015, respectively. The total amount of unrecognized tax benefits that, if ultimately recognized, would reduce the Company’s annual effective tax rate were $397,000 and $447,000 at December 31, 2016 and 2015, respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
|  | 2016 |  |  | 2015 |  |  | 2014 |
Balance at beginning of year |  | $ | 567 |  |  | $ | 576 |  |  | $ | 516 |
Additions based on tax positions related to the current year |  |  | 101 |  |  |  | 113 |  |  |  | 158 |
Reductions due to lapse of applicable statute of limitations |  |  | (108 | ) |  |  | (101 | ) |  |  | (98 | )
Settlements |  |  | (68 | ) |  |  | (21 | ) |  |  | - |
Balance at end of year |  | $ | 492 |  |  | $ | 567 |  |  | $ | 576 |
The Company is subject to income taxes in the U.S. federal and various state, local and foreign jurisdictions. Income tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for the years before 2012. The Company has $56,000 of unrecognized tax benefits recorded for periods for which the relevant statutes of limitations expire in the next 12 months. The Company is currently under examination by the Internal Revenue Service for its tax year ending December 31, 2013. Any adjustment from this examination is not expected to have a material impact on the consolidated financial position or results of operations of the Company. Management anticipates this examination will be resolved within the next six months. The Company has state tax credit carryforwards of $518,000 and $533,000 as of December 31, 2016 and 2015, respectively, set to expire between 2019 and 2026. The Company has foreign net operating losses of $222,000 of which the majority have no expiration. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense for all periods presented. The Company accrued approximately $98,000, $116,000 and $99,000 for the payment of interest and penalties at December 31, 2016, 2015 and 2014, respectively. The Company did not provide taxes with respect to $23.9 million of undistributed foreign earnings at December 31, 2016, since the earnings are considered by the Company to be permanently reinvested. In an unanticipated future event where these earnings are distributed or deemed distributed in a taxable transaction, the Company may be subject to United States income tax and foreign withholding taxes, the net tax liability of which is estimated to be $1.9 million.

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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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