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INCOME TAXES
 6 Months Ended
Apr. 30, 2013
INCOME TAXES [Abstract]  
INCOME TAXES
10. INCOME TAXES

 

Our effective tax rate for the first six months of fiscal 2013 was 34% in comparison to 31% for the same period in fiscal 2012. The increase in the effective income tax rate was primarily due to changes in the geographic mix of income or loss between tax jurisdictions. We recorded income tax expense during the first six months of fiscal 2013 of approximately $2.8 million compared to $3.4 million for the same period in fiscal 2012, primarily as a result of the reduction in pre-tax income period-over-period. We have not provided any U.S. income taxes on the undistributed earnings of our wholly-owned foreign subsidiaries based upon our determination that such earnings will be indefinitely reinvested. In the event these earnings are later distributed to the U.S., such distributions would likely result in additional U.S. tax that may be offset, at least in part by associated foreign tax credits.

 

Our unrecognized tax benefits were $154,000 as of April 30, 2013 and $132,000 as of October 31, 2012 and in each case included accrued interest.

 

We recognize accrued interest and penalties related to unrecognized tax benefits as components of income tax expense. We believe our unrecognized tax positions meet the minimum statutory threshold to avoid payment of penalties and, therefore, no tax penalties have been estimated. As of April 30, 2013, the gross amount of interest accrued, reported in Accrued expenses and other, was approximately $16,000, which did not include the federal tax benefit of interest deductions.

 

We file U.S. federal and state income tax returns, as well as tax returns in several foreign jurisdictions. The statutes of limitations with respect to unrecognized tax benefits will expire between July 2014 and July 2016.