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Income Taxes (Tables) | 12 Months Ended
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Sep. 30, 2022
Income Tax Disclosure [Abstract] |
Components of Loss Before Income Taxes | Components of loss before income taxes were as follows (in thousands):
|  | YEAR ENDED SEPTEMBER 30, |
|  | 2022 |  |  | 2021 |
United States |  | $ | (19,425 | ) |  | $ | (10,628 | )
Foreign |  |  | (3,258 | ) |  |  | (2,850 | )
|  | $ | (22,683 | ) |  | $ | (13,478 | )
Computation of Provision for Income Taxes | The provision for income taxes consisted of the following (in thousands):
|  | YEAR ENDED SEPTEMBER 30, |
|  | 2022 |  |  | 2021 |
Current |  |  |  |  |  |
Federal |  | $ | (12 | ) |  | $ | 14 |
Foreign |  |  | 202 |  |  |  | 561 |
State |  |  | — |  |  |  | — |
|  |  | 190 |  |  |  | 575 |
Deferred: |  |  |  |  |  |
Federal |  |  | — |  |  |  | — |
Foreign |  |  | (17 | ) |  |  | 3 |
|  |  | (17 | ) |  |  | 3 |
|  | $ | 173 |  |  | $ | 578 |
Reconciliation of Actual Income Tax Expenses | Actual income tax expense differs from income tax expense computed by applying the U.S. statutory federal tax rate of 21% for each of the fiscal years ended September 30, 2022 and 2021 as follows (in thousands):
|  | YEAR ENDED SEPTEMBER 30, |
|  | 2022 |  |  | 2021 |
Expense (benefit) for U.S federal income tax at statutory rate |  | $ | (4,763 | ) |  | $ | (2,834 | )
Effect of foreign income taxes |  |  | 3 |  |  |  | 1 |
Research and experimentation tax credit |  |  | 6 |  |  |  | (223 | )
State income taxes, net of federal income tax benefit |  |  | (265 | ) |  |  | 153 |
Nondeductible expenses |  |  | 927 |  |  |  | 44 |
Change in valuation allowance |  |  | 3,768 |  |  |  | 2,893 |
Impact on deferred taxes due to change in tax rate |  |  | - |  |  |  | 563 |
Change in fair value of contingent consideration |  |  | (278 | ) |  |  | (569 | )
Foreign income tax withholding |  |  | 114 |  |  |  | 419 |
Disallowance of stock compensation adjustments in excess of book |  |  | 217 |  |  |  | 334 |
Other items |  |  | 444 |  |  |  | (203 | )
|  | $ | 173 |  |  | $ | 578 |
Effective tax rate |  |  | (0.8 | )% |  |  | (4.3 | )%
Components of Net Deferred Income Tax Asset (Liabilities) | The income tax expense for fiscal years 2022 and 2021 primarily reflects withholding tax on rental income earned in foreign jurisdictions. The Company is currently unable to record any tax benefits for its tax losses in the U.S., Canada and the Russian Federation due to the uncertainty surrounding its ability to utilize such losses in the future to offset taxable income. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s net deferred income tax assets (liabilities) were as follows (in thousands):
|  | AS OF SEPTEMBER 30, 2022 |  |  | AS OF SEPTEMBER 30, 2021 |
|  | U.S. |  |  | Non U.S. |  |  | Total |  |  | U.S. |  | Non U.S. |  |  | Total |
Deferred income tax assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  | $ | 109 |  |  | $ | 6 |  |  | $ | 115 |  |  | $ | 80 |  | $ | 4 |  |  | $ | 84 |
Inventories |  |  | 8,295 |  |  |  | 218 |  |  |  | 8,513 |  |  |  | 8,042 |  |  | — |  |  |  | 8,042 |
Loss and tax credit carry-forwards |  |  | 29,606 |  |  |  | 5,037 |  |  |  | 34,643 |  |  |  | 27,578 |  |  | 4,945 |  |  |  | 32,523 |
Stock-based compensation |  |  | 262 |  |  |  | — |  |  |  | 262 |  |  |  | 398 |  |  | — |  |  |  | 398 |
Accrued product warranty |  |  | 99 |  |  |  | 8 |  |  |  | 107 |  |  |  | 77 |  |  | 2 |  |  |  | 79 |
Contingent earn-out consideration |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 917 |  |  | — |  |  |  | 917 |
Accrued compensated absences |  |  | 347 |  |  |  | — |  |  |  | 347 |  |  |  | 320 |  |  | — |  |  |  | 320 |
Property and equipment |  |  | — |  |  |  | 578 |  |  |  | 578 |  |  |  | — |  |  | 487 |  |  |  | 487 |
Prepaid income taxes |  |  | — |  |  |  | 92 |  |  |  | 92 |  |  |  | — |  |  | 266 |  |  |  | 266 |
Other reserves |  |  | 30 |  |  |  | 15 |  |  |  | 45 |  |  |  | 114 |  |  | 11 |  |  |  | 125 |
Subtotal deferred income tax assets |  |  | 38,748 |  |  |  | 5,954 |  |  |  | 44,702 |  |  |  | 37,526 |  |  | 5,715 |  |  |  | 43,241 |
Valuation allowance |  |  | (35,462 | ) |  |  | (5,914 | ) |  |  | (41,376 | ) |  |  | (31,668 | ) |  | (5,704 | ) |  |  | (37,372 | )
Net deferred income tax assets |  |  | 3,286 |  |  |  | 40 |  |  |  | 3,326 |  |  |  | 5,858 |  |  | 11 |  |  |  | 5,869 |
Deferred income tax liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Allowance for doubtful accounts |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  | — |  |  |  | — |
Inventories |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  | (6 | ) |  |  | (6 | )
Right-of-use assets |  |  | (109 | ) |  |  | — |  |  |  | (109 | ) |  |  | (131 | ) |  | — |  |  |  | (131 | )
Intangible assets |  |  | (356 | ) |  |  | — |  |  |  | (356 | ) |  |  | (642 | ) |  | — |  |  |  | (642 | )
Property, plant and equipment and other |  |  | (2,821 | ) |  |  | (53 | ) |  |  | (2,874 | ) |  |  | (5,085 | ) |  | (36 | ) |  |  | (5,121 | )
Total deferred income tax liabilities |  |  | (3,286 | ) |  |  | (53 | ) |  |  | (3,339 | ) |  |  | (5,858 | ) |  | (42 | ) |  |  | (5,900 | )
Net deferred income tax liabilities |  | $ | — |  |  | $ | (13 | ) |  | $ | (13 | ) |  | $ | — |  | $ | (31 | ) |  | $ | (31 | )

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