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INCOME TAXES (Tables) | 12 Months Ended
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Oct. 31, 2019
INCOME TAXES |
Schedule of Income Taxes Provision (Benefit) | In the fiscal years set forth below, the provision for income taxes consisted of the following (in thousands):
|  | Year Ended October 31,
|  | 2019 |  | 2018 |  | 2017
Current: |  |  |  |  |  |  |  |  |
U.S. taxes |  | $ | 1,854 |  | $ | 6,333 |  | $ | 308
Foreign taxes |  |  | 3,715 |  |  | 5,203 |  |  | 4,185
|  |  | 5,569 |  |  | 11,536 |  |  | 4,493
Deferred: |  |  |  |  |  |  |  |  |
U.S. taxes |  |  | (31) |  |  | (326) |  |  | 1,236
Foreign taxes |  |  | 291 |  |  | (204) |  |  | (128)
|  |  | 260 |  |  | (530) |  |  | 1,108
|  | $ | 5,829 |  | $ | 11,006 |  | $ | 5,601
Schedule of Reconciliation of Statutory Tax Rate to Effective Tax Rate | A comparison of income tax expense at the U.S. statutory rate to the Company’s effective tax rate is as follows (dollars in thousands):
|  | Year Ended October 31, |
|  | 2019 |  | 2018 |  | 2017 |
Income before income taxes: |  |  |  |  |  |  |  |  |  |
Domestic |  | $ | 9,793 |  | $ | 14,101 |  | $ | 5,477 |
Foreign |  |  | 13,531 |  |  | 18,395 |  |  | 15,239 |
|  | $ | 23,324 |  | $ | 32,496 |  | $ | 20,716 |
Tax rates: |  |  |  |  |  |  |  |  |  |
U.S. statutory rate |  |  | 21 | % |  | 23 | % |  | 34 | %
Effect of tax rate of international jurisdictions different than U.S. statutory rates |  |  | 4 | % |  | 2 | % |  | (5) | %
Valuation allowance |  |  | 1 | % |  | 0 | % |  | 1 | %
State taxes |  |  | 1 | % |  | 0 | % |  | 0 | %
Tax Credits |  |  | (2) | % |  | (1) | % |  | (3) | %
Effect of Tax Rate Changes |  |  | 0 | % |  | 4 | % |  | 0 | %
Transition Tax |  |  | (1) | % |  | 7 | % |  | 0 | %
US tax on distributed and undistributed earnings |  |  | 3 | % |  | 0 | % |  | 0 | %
US benefit of foreign intangible income |  |  | (3) | % |  | 0 | % |  | 0 | %
Other |  |  | 1 | % |  | (1) | % |  | 0 | %
Effective tax rate |  |  | 25 | % |  | 34 | % |  | 27 | %
Schedule of Deferred Tax Assets and Liabilities | Significant components of our deferred tax assets and liabilities at October 31, 2019 and 2018 are as follows (in thousands):
|  | October 31,
|  | 2019 |  | 2018
Deferred Tax Assets: |  |  |  |  |  |
Accrued inventory reserves |  | $ | 1,224 |  | $ | 1,325
Accrued warranty expenses |  |  | 363 |  |  | 499
Compensation related expenses |  |  | 2,723 |  |  | 2,644
Unrealized exchange gain/loss |  |  | 143 |  |  | 159
Other accrued expenses |  |  | 170 |  |  | 170
Net operating loss carryforwards |  |  | 1,380 |  |  | 1,316
Other credit carryforwards |  |  | 766 |  |  | 686
Other |  |  | 293 |  |  | 350
|  |  | 7,062 |  |  | 7,149
Less: Valuation allowance – net operating loss and other credit carryforwards |  |  | (2,227) |  |  | (2,106)
Deferred tax assets |  |  | 4,835 |  |  | 5,043
Deferred Tax Liabilities: |  |  |  |  |  |
Net derivative instruments |  |  | (313) |  |  | (208)
Property and equipment and capitalized software development costs |  |  | (2,632) |  |  | (2,370)
Other |  |  | (204) |  |  | (231)
Net deferred tax assets |  | $ | 1,686 |  | $ | 2,234
Schedule of Income Tax Expense | A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding the related accrual for interest or penalties, is as follows (in thousands):
|  | 2019 |  | 2018 |  | 2017
Balance, beginning of year |  | $ | 180 |  | $ | 1,101 |  | $ | 1,102
Additions based on tax positions related to the current year |  |  | 36 |  |  | 37 |  |  | 37
Additions (reductions) related to prior year tax positions |  |  | — |  |  | (945) |  |  | (20)
Reductions due to statute expiration |  |  | (23) |  |  | (18) |  |  | (74)
Other |  |  | — |  |  | 5 |  |  | 56
Balance, end of year |  | $ | 193 |  | $ | 180 |  | $ | 1,101
Summary of open tax years by major jurisdiction |
United States federal |  | Fiscal 2016 through the current period
Germany¹ |  | Fiscal 2017 through the current period
Taiwan |  | Fiscal 2017 through the current period
¹Includes federal as well as state, provincial or similar local jurisdictions, as applicable.

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