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Provision for Income Taxes
 3 Months Ended
Oct. 31, 2022
Income Tax Disclosure [Abstract]  
Provision for Income Taxes

Note 14—Provision for Income Taxes

 

The Company’s tax provision or benefit from income taxes for interim periods has generally been determined using an estimate of its annual effective tax rate applied to year-to-date income and records the discrete tax items in the period to which they relate. In each quarter, the Company updates the estimated annual effective tax rate and makes a year-to-date adjustment to the tax provision as necessary.

 

The Company’s annual effective tax rate for the fiscal year ending July 31, 2023 differs from the United States federal statutory tax rate due to certain factors with temporary differences primarily related to equity compensation expenses.

 

As of October 31, 2022, the Company had $2.8 million of deferred tax assets for which it has established a valuation allowance of $1.9 million, related to U.S. federal and state taxes and for a certain international subsidiary.

 

The Company is subject to taxation in the United States and certain foreign jurisdictions. Earnings from non-U.S. activities are subject to local country income tax. The material jurisdictions where the Company is subject to potential examination by tax authorities include the United States, Norway, Lithuania and Israel.