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Note 8 - Income Taxes | 12 Months Ended
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Dec. 31, 2013
Income Tax Disclosure [Abstract] |
Income Tax Disclosure [Text Block] | Note 8 - Income Taxes The provision for income taxes expense (benefit) consists of:
|  | Years Ended December 31, |
|  | 2013 |  |  | 2012 |
Current – Continuing Operations: |  |  |  |  |  |
Federal |  | $ | - |  |  | $ | - |
State |  |  | - |  |  |  | - |
Foreign |  |  | 94 |  |  |  | 539 |
|  |  | 94 |  |  |  | 539 |
Current – Discontinued Operations: |  |  |  |  |  |  |  |
Federal |  | $ | - |  |  | $ | - |
State |  |  | - |  |  |  | - |
|  |  | - |  |  |  | - |
Deferred – Continuing Operations: |  |  |  |  |  |
Federal |  |  | 220 |  |  |  | 220 |
State |  |  | - |  |  |  | - |
Foreign |  |  | (75 | ) |  |  | (205 | )
|  |  | 145 |  |  |  | 15 |
Deferred – Discontinued Operations: |  |  |  |  |  |  |  |
Federal |  |  | - |  |  |  | (174 | )
State |  |  | - |  |  |  | - |
|  |  | - |  |  |  | (174 | )
Total |  | $ | 239 |  |  | $ | 380 |
We reflected a tax expense of $239 for the year ended December 31, 2013. The 2013 tax provision is principally a result of the increase in the net deferred tax liability related to deferred tax liabilities generated from goodwill and certain intangible assets that cannot be predicted to reverse for book purposes during our loss carryforward periods. In addition, we incurred foreign income taxes in 2013. We reflected a tax expense of $380 for the year ended December 31, 2012. The 2012 tax provision is principally a result of the increase in the net deferred tax liability related to liabilities generated from goodwill and certain intangible assets that cannot be predicted to reverse for book purposes during our loss carryforward periods. In addition, we incurred foreign income taxes in 2012. Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for income tax purposes. Significant components of our deferred tax liabilities and assets are as follows:
|  | Years Ended December 31, |
|  | 2013 |  |  | 2012 |
Deferred tax liabilities: |  |  |  |  |  |
Property, plant and equipment |  | $ | 232 |  |  | $ | 450 |
Intangible assets and other |  |  | 4,242 |  |  |  | 4,272 |
Other |  |  | 94 |  |  |  | - |
Total deferred tax liabilities |  |  | 4,568 |  |  |  | 4,722 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  |  | 18,901 |  |  |  | 18,505 |
Intangible assets |  |  | 4,265 |  |  |  | 4,664 |
Accrued expenses, reserves and other |  |  | 3,373 |  |  |  | 3,764 |
Total deferred tax assets |  |  | 26,539 |  |  |  | 26,933 |
Valuation allowance for deferred tax assets |  |  | (26,131 | ) |  |  | (26,251 | )
Net deferred tax assets |  |  | 408 |  |  |  | 682 |
Net deferred tax liability |  | $ | (4,160 | ) |  | $ | (4,040 | )
The $4,160 net deferred tax liability for the year ended December 31, 2013 is comprised of a current deferred tax liability of $9 and a long-term deferred tax liability of $4,242, offset partially by current deferred tax asset of $91. The $4,040 net deferred tax liability for the year ended December 31, 2012 is comprised of a long-term deferred tax liability of $4,160, offset partially by current deferred tax asset of $120. In 2013 and 2012, in the U.S. and the U.K., we continue to report a valuation allowance for our deferred tax assets that cannot be offset by reversing temporary differences. This results from the conclusion that it is more likely than not that we would not utilize our U.S. and U.K. NOL’s that had accumulated over time. The recognition of a valuation allowance on our deferred tax assets resulted from our evaluation of all available evidence, both positive and negative. The assessment of the realizability of the NOL’s was based on a number of factors including, our history of net operating losses, the volatility of our earnings, our historical operating volatility, our historical inability to accurately forecast earnings for future periods and the continued uncertainty of the general business climate as of the end of 2013. We concluded that these factors represent sufficient negative evidence and have concluded that we should record a full valuation allowance under FASB‘s guidance on the accounting for income taxes. In 2013 and 2012, we did not record a valuation allowance for the Chinese deferred tax assets as we determined that it was more likely than not that they would be realized. We continually assess the carrying value of this asset based on relevant accounting standards. As of December 31, 2013, we have foreign and domestic NOL’s totaling approximately $62,152 available to reduce future taxable income. Foreign loss carryforwards of approximately $12,390 can be carried forward indefinitely. The domestic NOL carryforward of $49,762 expires from 2019 through 2033. The domestic NOL carryforward includes approximately $2,949 for which a benefit will be recorded in capital in excess of par value when realized. For financial reporting purposes, income (loss) from continuing operations before income taxes is as follows:
|  | Years Ended December 31, |
|  | 2013 |  |  | 2012 |
United States |  | $ | (875 | ) |  | $ | 829 |
Foreign |  |  | 26 |  |  |  | (1,403 | )
Total |  | $ | (849 | ) |  | $ | (574 | )
There are no undistributed earnings of our foreign subsidiaries, at December 31, 2013 or 2012. As of December 31, 2011, the tax holiday for our Chinese operations expired and the full corporate rate of 25% became effective. In 2013, our tax rate in China was reduced to 15% due to the successful application for certain tax designations. The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to income (loss) from continuing operations before income taxes as follows:
|  | Years Ended December 31, |
|  | 2013 |  |  | 2012 |
Provision/(benefit) computed using the statutory rate |  |  | (34.0 | %) |  |  | (34.0 | %)
Increase (reduction) in taxes resulting from: |  |  |  |  |  |  |  |
Foreign |  |  | 1.2 |  |  |  | 127.6 |
Valuation allowance |  |  | 20.3 |  |  |  | (119.3 | )
Equity compensation |  |  | 38.6 |  |  |  | 55.4 |
Expiration of capital loss carryforward |  |  | - |  |  |  | 59.6 |
Other |  |  | 2.1 |  |  |  | 7.2 |
Provision (benefit) for income taxes |  |  | 28.2 | % |  |  | 96.5 | %
In 2013 and 2012, the provision for income taxes was higher than what would be expected if the statutory rate were applied to pretax income. This is due to the continuation of reflecting a full valuation allowance for our U.S. and U.K. deferred tax assets, certain non-deductible expenses for tax purposes, and foreign earnings. Accounting for Uncertainty in Income Taxes Our unrecognized tax benefits related to uncertain tax positions at December 31, 2013 relate to Federal and various state jurisdictions. The following table summarizes the activity related to our unrecognized tax benefits:
|  | Years ended December 31, |
|  | 2013 |  |  | 2012 |
Balance at beginning of the year |  | $ | 7,508 |  |  | $ | 6,779 |
Increases related to the current year tax positions |  |  | - |  |  |  | 729 |
Increases related to prior year tax positions |  |  | - |  |  |  | - |
Decreases related to prior year tax positions |  |  | (212 | ) |  |  | - |
Expiration of statute of limitations for assessment of taxes |  |  | - |  |  |  | - |
Settlements |  |  | - |  |  |  | - |
Balance at the end of the year |  |  | - |  |  |  | - |
|  | $ | 7,296 |  |  | $ | 7,508 |
The total unrecognized tax benefit balances at December 31, 2013 and 2012 are comprised of tax benefits that, if recognized, would result in a deferred tax asset and a corresponding increase in our valuation allowance. As a result, because the benefit would be offset by an increase in the valuation allowance, there would be no effect on our effective tax rate. We are not required to accrue interest and penalties as the unrecognized tax benefits have been recorded as a decrease in our NOL. Interest and penalties would begin to accrue in the period in which the NOL’s related to the uncertain tax positions are utilized. We do not expect our unrecognized tax benefits to change significantly over the next twelve months. As a result of our operations, we file income tax returns in various jurisdictions including U.S. federal, U.S. state and foreign jurisdictions. We are routinely subject to examination by taxing authorities in these various jurisdictions. Our U.S. tax matters for the years 2001 through 2013 remain subject to examination by the Internal Revenue Service (“IRS”) due to our NOL carryforwards. Our U.S. tax matters for the years 2001 through 2013 remain subject to examination by various state and local tax jurisdictions due to our NOL carryforwards. Our tax matters for the years 2007 through 2013 remain subject to examination by the respective foreign tax jurisdiction authorities. The IRS has completed the examination of our 2009 US Federal income tax return, with no resulting material effect to our financial position or results of operations. The IRS has informed us that the 2011 US Federal income tax year will be examined commencing in early 2014

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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 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 2: 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 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 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=6907707&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=6907707&loc=d3e32537-109319 Reference 6: 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=6907707&loc=d3e32559-109319 + Details
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