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INCOME TAXES (Tables) | 12 Months Ended
--- | ---
Jun. 30, 2011
INCOME TAXES |
Components of (loss) income before income taxes |
|  | 2011 |  | 2010 |  | 2009 |
--- | --- | --- | --- | --- | --- | --- | ---
|  | (Dollars in thousands) |
(Loss) income before income taxes: |  |  |  |  |  |  |  |  |  |
| U.S. |  | $ | (31,963 | ) | $ | 35,289 |  | $ | 112,524 |
| International |  |  | 6,334 |  |  | 17,925 |  |  | (33,758 | )
|  | $ | (25,629 | ) | $ | 53,214 |  | $ | 78,766 |
(Benefit) provision for income taxes |
|  | 2011 |  | 2010 |  | 2009 |
--- | --- | --- | --- | --- | --- | --- | ---
|  | (Dollars in thousands) |
Current: |  |  |  |  |  |  |  |  |  |
| U.S. |  | $ | 3,658 |  | $ | 5,580 |  | $ | 48,935 |
| International |  |  | 1,557 |  |  | 14,882 |  |  | (3,142 | )
Deferred: |  |  |  |  |  |  |  |  |  |
| U.S. |  |  | (17,882 | ) |  | 4,007 |  |  | 568 |
| International |  |  | 3,171 |  |  | 1,108 |  |  | (4,411 | )
|  | $ | (9,496 | ) | $ | 25,577 |  | $ | 41,950 |
Provision for income taxes, reconciliation to applicable U.S. statutory rate |
|  | 2011 |  | 2010 |  | 2009 |
--- | --- | --- | --- | --- | --- | --- | ---
U.S. statutory rate |  |  | (35.0 | )% |  | 35.0 | % |  | 35.0 | %
State income taxes, net of federal income tax benefit |  |  | (0.1 | ) |  | 3.4 |  |  | 3.4 |
Tax effect of goodwill impairment |  |  | 10.8 |  |  | 11.4 |  |  | 14.5 |
Foreign income taxes at other than U.S. rates |  |  | 7.9 |  |  | (0.8 | ) |  | (1.6 | )
Work Opportunity and Welfare-to-Work Tax Credits |  |  | (15.3 | ) |  | (6.4 | ) |  | (4.9 | )
Adjustment of prior year income tax balances |  |  | — |  |  | 3.9 |  |  | 4.8 |
Other, net |  |  | (5.4 | ) |  | 1.6 |  |  | 2.1 |
|  |  | (37.1 | )% |  | 48.1 | % |  | 53.3 | %
Components of the net deferred tax assets and liabilities |
|  | 2011 |  | 2010 |
--- | --- | --- | --- | --- | ---
|  | (Dollars in thousands) |
Deferred tax assets: |  |  |  |  |  |  |
Deferred rent |  | $ | 15,233 |  | $ | 15,677 |
Payroll and payroll related costs |  |  | 37,852 |  |  | 34,294 |
Net operating loss carryforwards |  |  | 1,210 |  |  | 2,106 |
Salon asset impairment |  |  | 5,176 |  |  | 4,154 |
Inventories |  |  | 2,968 |  |  | 3,136 |
Derivatives |  |  | 229 |  |  | 311 |
Deferred gift card revenue |  |  | 1,536 |  |  | 1,581 |
Federal and state benefit on uncertain tax positions |  |  | 8,549 |  |  | 10,178 |
Allowance for doubtful accounts/notes |  |  | 9,855 |  |  | 575 |
Insurance |  |  | 5,669 |  |  | 6,301 |
Other |  |  | 6,167 |  |  | 5,481 |
Total deferred tax assets |  | $ | 94,444 |  | $ | 83,794 |
Deferred tax liabilities: |  |  |  |  |  |  |
Depreciation |  | $ | (29,348 | ) | $ | (17,603 | )
Amortization of intangibles |  |  | (94,257 | ) |  | (107,392 | )
Accrued property taxes |  |  | (1,942 | ) |  | (2,029 | )
Deferred debt issuance costs |  |  | (6,215 | ) |  | (7,937 | )
Other |  |  | (3 | ) |  | — |
Total deferred tax liabilities |  | $ | (131,765 | ) | $ | (134,961 | )
Net deferred tax liabilities |  | $ | (37,321 | ) | $ | (51,167 | )
Unrecognized tax benefits |
|  | 2011 |  | 2010 |  | 2009 |
--- | --- | --- | --- | --- | --- | --- | ---
Balance at beginning of period |  | $ | 16,856 |  | $ | 14,787 |  | $ | 20,400 |
Additions based on tax positions related to the current year |  |  | 796 |  |  | 5,549 |  |  | 2,765 |
(Reductions) additions based on tax positions of prior years |  |  | (759 | ) |  | (185 | ) |  | 121 |
Reductions on tax positions related to the expiration of the statue of limitations |  |  | (2,718 | ) |  | (2,993 | ) |  | (8,167 | )
Settlements |  |  | (682 | ) |  | (302 | ) |  | (332 | )
Balance at end of period |  | $ | 13,493 |  | $ | 16,856 |  | $ | 14,787 |

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- Definition Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Topic 740 -SubTopic 10 -Publisher FASB -Number -Article -Subparagraph -Name Accounting Standards Codification -Paragraph 9 -Section 50 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 + Details
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- Definition Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name FASB Interpretation (FIN) -Number 48 -Paragraph 21 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 2: 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 + Details
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