XML 34 R20.htm IDEA: XBRL DOCUMENT
v3.22.2

Income Taxes | 9 Months Ended
--- | ---
Jun. 30, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | Note 13. Income Taxes The components of income before income taxes are as follows (dollars in thousands):
|  | Three Months Ended June 30, |  |  | Nine Months Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Domestic |  | $ | 38,167 |  |  | $ | 4,895 |  |  | $ | 52,366 |  |  | $ | 19,139 |
Foreign |  |  | (26,440 | ) |  |  | 6,967 |  |  |  | (18,327 | ) |  |  | 21,628 |
Income before income taxes |  | $ | 11,727 |  |  | $ | 11,862 |  |  | $ | 34,039 |  |  | $ | 40,767 |
The components of the provision for income taxes are as follows (dollars in thousands):
|  | Three Months Ended June 30, |  |  | Nine Months Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Domestic |  | $ | (4,807 | ) |  | $ | 2,661 |  |  | $ | (3,137 | ) |  | $ | 6,414 |
Foreign |  |  | 115,801 |  |  |  | 3,403 |  |  |  | 117,875 |  |  |  | (3,549 | )
Provision for income taxes |  | $ | 110,994 |  |  | $ | 6,064 |  |  | $ | 114,738 |  |  | $ | 2,865 |
Effective income tax rate |  |  | 946.5 | % |  |  | 51.1 | % |  |  | 337.1 | % |  |  | 7.0 | %
The effective tax rates for the periods presented are based upon estimated income for the fiscal year and the statutory tax rates enacted in the jurisdictions in which we operate. For all periods presented, the effective tax rate differs from the 21.0% statutory U.S. tax rate due to the impact of the nondeductible stock-based compensation and our mix of jurisdictional earnings and related differences in foreign statutory tax rates. Our effective tax rate for the three months ended June 30, 2022 was 946.5% compared to 51.1% for the three months ended June 30, 2021. Consequently, our provision for income taxes for the three months ended June 30, 2022 was $111.0 million, a net change of $104.9 million from a provision for income taxes of $6.1 million for the three months ended June 30, 2021. This difference was attributable to the establishment of a valuation allowance in a foreign jurisdiction as discussed below. Our effective tax rate for the nine months ended June 30, 2022 was 337.1% compared to 7.0% for the nine months ended June 30, 2021. Consequently, our provision for income taxes for the nine months ended June 30, 2022 was $114.7 million, a net change of $111.8 million from a provision for income taxes of $2.9 million for the nine months ended June 30, 2021. This difference was attributable to the establishment of a valuation allowance in a foreign jurisdiction as discussed below, our composition of jurisdictional earnings, U.S. inclusions of foreign taxable income as a result of 2017 tax law changes, and a $15.8 million tax benefit recorded as a result of an increase to the enacted Netherlands tax rate in the first quarter of fiscal 2021. Deferred income taxes arise from temporary difference between the tax and financial statement recognition of revenue and expenses. We regularly assess the need for a valuation allowance against our deferred tax assets. In evaluating whether it is more likely than not that some or all of our deferred tax assets will not be realized, we consider all available positive and negative evidence. During the third quarter of fiscal year 2022, we established a valuation allowance of $107.6 million against our deferred tax assets in the Netherlands, which consists of tax amortizable intellectual property and net operating loss carryforwards. We determined we had new evidence, based on updates to transfer pricing arrangements and changes to the earnings guidance for fiscal year 2022. We will continue to maintain a valuation allowance against our Netherlands deferred tax assets until we believe it is more likely than not that these assets will be realized. If sufficient positive evidence arises in the future indicating that all or a portion of the deferred tax assets meet the more likely than not standard, the valuation allowance would be reversed accordingly in the period that such determination is made.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration