XML 44 R15.htm IDEA: XBRL DOCUMENT
v3.7.0.1

9. Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | For fiscal year 2016, we recorded an income tax benefit of $49. For fiscal year 2015, we recorded an income tax benefit of $1,714. As of December 31, 2016, we maintained a valuation allowance of $1,011 against our net operating loss carryforwards, foreign tax credits and all deferred tax assets in Canada, principally net operating losses. During the second quarter of 2016, we concluded, based upon the assessment of all available evidence that it was more-likely-than-not that we would not be able to realize a portion of our U.S. deferred tax assets in the future. As a result, a valuation allowance of $405 was placed on the overall U.S. net deferred tax asset. The benefit of income taxes for fiscal years 2016 and 2015 consisted of the following:
|  | For the fiscal years ended |
|  | December 31, 2016 |  |  | January 2, 2016 |
Current tax expense (benefit): |  |  |  |  |  |  |  |
Federal |  | $ | 12 |  |  | $ | (855 | )
State |  |  | 36 |  |  |  | (18 | )
Foreign |  |  | – |  |  |  | (229 | )
Current tax expense (benefit) |  | $ | 48 |  |  | $ | (1,102 | )
Deferred tax expense — domestic |  |  | (97 | ) |  |  | (831 | )
Deferred tax expense — foreign |  |  | – |  |  |  | 219 |
Benefit of income taxes |  | $ | (49 | ) |  | $ | (1,714 | )
A reconciliation of our benefit of income taxes with the federal statutory tax rate for fiscal years 2016 and 2015 is shown below:
|  | For the fiscal years ended |
|  | December 31, 2016 |  |  | January 2, 2016 |
Income tax expense at statutory rate |  | $ | (617 | ) |  |  | (1,920 | )
Portion attributable to noncontrolling interest at statutory rate |  |  | 107 |  |  |  | 413 |
State tax expense, net of federal tax effect |  |  | (69 | ) |  |  | (288 | )
Permanent differences |  |  | 20 |  |  |  | 83 |
Change in valuation allowance |  |  | 414 |  |  |  | (7 | )
Recognition of tax effect for the cumulative undistributed earnings from Canada |  |  | – |  |  |  | (16 | )
Other |  |  | 95 |  |  |  | 21 |
|  |  | (49 | ) |  |  | (1,714 | )
Loss before benefit of income taxes and noncontrolling interest was derived from the following sources for fiscal years 2016 and 2015 as shown below:
|  | For the fiscal years ended |
|  | December 31, 2016 |  |  | January 2, 2016 |
United States |  | $ | (1,677 | ) |  | $ | (5,452 | )
Canada |  |  | (137 | ) |  |  | (194 | )
|  | $ | (1,814 | ) |  | $ | (5,646 | )
The components of net deferred tax assets (liabilities) as of December 31, 2016 and January 2, 2016, are as follows:
|  | December 31, 2016 |  |  | January 2, 2016 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 794 |  |  | $ | 520 |
Federal and state tax credits |  |  | 476 |  |  |  | 442 |
Reserves |  |  | 240 |  |  |  | 218 |
Accrued expenses |  |  | 2,015 |  |  |  | 1,964 |
Share-based compensation |  |  | 355 |  |  |  | 352 |
Accumulated other comprehensive loss |  |  | 361 |  |  |  | 361 |
Property and equipment |  |  | 8 |  |  |  | 191 |
Unrealized Currency Exchange |  |  | 238 |  |  |  | – |
Other |  |  | 161 |  |  |  | 166 |
Total deferred tax assets |  |  | 4,648 |  |  |  | 4,214 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Prepaid expenses |  |  | (56 | ) |  |  | (89 | )
Property and equipment |  |  | (162 | ) |  |  | (138 | )
Investments |  |  | (1,269 | ) |  |  | (1,269 | )
Other |  |  | (69 | ) |  |  | (137 | )
Total deferred tax liabilities |  |  | (1,556 | ) |  |  | (1,633 | )
Valuation allowance |  |  | (1,011 | ) |  |  | (597 | )
Net deferred tax assets |  | $ | 2,081 |  |  | $ | 1,984 |
The deferred tax amounts have been classified in the accompanying consolidated balance sheets as follows:
|  | December 31, 2016 |  |  | January 2, 2016 |
Current assets |  | $ | – |  |  | $ | – |
Non-current assets |  |  | 2,081 |  |  |  | 1,984 |
Non-current liabilities |  |  | – |  |  |  | – |
|  | $ | 2,081 |  |  | $ | 1,984 |
In November 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-17, “Income Taxes” which simplifies the balance sheet presentation of deferred income taxes. The Company has adopted the provisions of the standard for its 2016 consolidated financial statements including retroactive reclassifications of the $1,657 current deferred income tax asset as of January 2, 2016 to a non-current deferred income tax asset. This reclassification does not have a significant impact on the Company’s consolidated balance sheet and has no effect on the net loss. Future utilization of net operating loss (“NOL”) and tax credit carryforwards is subject to certain limitations under provisions of Section 382 of the Internal Revenue Code (“IRC”). This section relates to a 50 percent change in control over a three-year period. We believe that the issuance of common stock during 1999 resulted in an “ownership change” under Section 382. Accordingly, our ability to utilize NOL and tax credit carryforwards generated prior to February 1999 is limited to approximately $56 per year. As of December 31, 2016, we had a foreign tax credit carryforward of $256 and a federal NOL of $209 not subject Section 382 of the IRC. We also had state NOL carryforwards of $425. The state NOL carryforwards are available to offset future taxable income or reduce taxes payable through 2030. These state loss carryforwards began expiring in 2011. In Canada, we had federal and provincial NOL carryforwards of $85. We recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% percent likelihood of being realized upon ultimate settlement with the relevant tax authority. As of December 31, 2016 and January 2, 2016, we did not have any material uncertain tax positions. It is our practice to recognize interest related to income tax matters as a component of interest expense and penalties as a component of selling, general and administrative expense. As of December 31, 2016 and January 2, 2016, we had an immaterial amount of accrued interest and penalties. We are subject to income taxes in the U.S. federal jurisdiction, foreign jurisdictions and various state jurisdictions. Tax regulations from each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, we are no longer subject to U.S. federal, foreign, state or local income tax examinations by tax authorities for the years before 2012. We are not currently under examination by any taxing jurisdiction. We had no significant unrecognized tax benefits as of December 31, 2016, that would reasonably be expected to affect our effective tax rate during the next twelve months.

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/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
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration