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Income Taxes | 6 Months Ended
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Jul. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | Note 15 – Income Taxes Our effective tax rates for the period are as follows:
|  | Three Months Ended |  |  | Six Months Ended |
Fiscal 2022 |  |  | 9.1 | % |  |  | 5.8 | %
Fiscal 2021 |  |  | 99.4 | % |  |  | 48.6 | %
We determine our estimated annual effective tax rate at the end of each interim period based on full-year forecasted pre-tax income and facts known at that time. The estimated annual effective tax rate is applied to the year-to-date pre-tax income at the end of each interim period with the cumulative effect of any changes in the estimated annual effective tax rate being recorded in the fiscal quarter in which the change is determined. The tax effect of significant unusual items is reflected in the period in which they occur. During the three months ended July 31, 2021, we recognized an income tax expense of $0.7 million. The effective tax rate in this period was directly impacted by a $1.1 million tax benefit from the forgiveness of the PPP Loan, a $ 0.1 million tax benefit arising from a windfall related to our stock compensation and a $32,000 tax benefit related to return to provision adjustments from foreign tax returns filed in the quarter. The PPP Loan forgiveness recognized during the three months ended July 31, 2021, is excluded from federal taxable income under Section 1106(i) of the CARES Act. During the three months ended August 1, 2020, we recognized an income tax expense of approximately $0.5 million. The effective tax rate in this period was directly impacted by a significant increase in forecasted operating results for fiscal year 2021 as compared to operating results forecasted at the end of our first quarter of fiscal 2021, a $0.1 million expense arising from a shortfall related to our stock and a $ 0.1 million expense related to return to provision adjustments from foreign tax returns filed in the quarter. During the six months ended July 31, 2021, we recognized an income tax expense of $0.5 million. The effective tax rate in this period was directly impacted by a $1.1 million tax benefit from the forgiveness of the PPP loan, a $ 0.1 million tax benefit arising from windfall tax expense related to our stock, a $32,000 tax benefit related to return to provision adjustments from foreign tax returns filed in the year and a $0.3 million tax benefit related to the expiration of the statute of limitations on previously uncertain tax positions. The PPP loan forgiveness recognized during the six months ended July 31, 2021, is excluded from taxable income under Section 1106(i) of the CARES Act. During the six months ended August 1, 2020, we recognized an income tax expense of approximately $0.4 million. The effective tax rate in this period was directly impacted by a significant increase in forecasted operating results for fiscal year 2021 as compared to operating results forecasted at the end of our first quarter of fiscal year 2021, a $0.1 million expense arising from shortfall tax expense related to our stock, a $0.1 million expense related to return to provision adjustments from foreign tax returns filed in the year and a $0.1 million tax benefit related to the expiration of the statute of limitations on previously uncertain tax positions. We maintain a valuation allowance on some of our deferred tax assets in certain jurisdictions. A valuation allowance is required when, based upon an assessment of various factors, including recent operating loss history, anticipated future earnings, and prudent and reasonable tax planning strategies, it is more likely than not that some portion of the deferred tax assets will not be realized. Unrecognized tax benefits represent the difference between tax positions taken or expected to be taken in a tax return and the benefits recognized for financial reporting purposes. As of July 31, 2021, our cumulative unrecognized tax benefits totaled $221,000 compared to $384,000 as of January 31, 2020. We established unrecognized tax benefits for certain positions taken on fiscal year 2021 Canadian tax return. There were no other developments affecting unrecognized tax benefits during the quarter ended July 31, 2021.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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