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v3.22.2.2

INCOME TAXES (Tables) | 12 Months Ended
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Jul. 02, 2022
Income Tax Disclosure [Abstract] |
Schedule of Components of Income Tax Expense (Benefit) | Income tax benefit consists of the following:
| Fiscal Year Ended
| July 2, 2022 |  | July 3, 2021 |  | June 27, 2020
| (in thousands)
Current income tax benefit: |  |  |  |  |
United States | $ | (2,179) |  |  | $ | 1,416 |  |  | $ | 365 |
Foreign | 2,012 |  |  | 1,098 |  |  | 154 |
| (167) |  |  | 2,514 |  |  | 519 |
Deferred income tax benefit: |  |  |  |  |
United States | 443 |  |  | (858) |  |  | (1,850) |
Foreign | 38 |  |  | (84) |  |  | 892 |
| 481 |  |  | (942) |  |  | (958) |
Total income tax provision (benefit) | $ | 314 |  |  | $ | 1,572 |  |  | $ | (439) |
Effective Tax Rate Reconciliation | The Company’s effective tax rate differs from the federal tax rate as follows:
| Fiscal Year Ended
| July 2, 2022 |  | July 3, 2021 |  | June 27, 2020
| (in thousands)
Federal income tax provision at statutory rates | $ | 775 |  |  | $ | 1,242 |  |  | $ | 907 |
State income taxes, net of federal tax effect | 86 |  |  | 76 |  |  | 90 |
Foreign tax rate differences | 336 |  |  | (36) |  |  | 336 |
Tax rate change | — |  |  | 184 |  |  | — |
Federal rate differences applied to net operating loss carryback | (593) |  |  | — |  |  | — |
Effect of income tax credits | (920) |  |  | (413) |  |  | (310) |
Previously unrecognized tax benefits | 146 |  |  | (296) |  |  | (1,345) |
Effect of repatriation of foreign earnings, net | — |  |  | (61) |  |  | — |
Tax penalties & interest | 179 |  |  | — |  |  | — |
Global Intangible Low-Taxed Income (GILTI) tax | 59 |  |  | 34 |  |  | — |
Provision to return reconciliation | (32) |  |  | 50 |  |  | (241) |
Equity compensation shortfall | 104 |  |  | 572 |  |  | — |
Other | 174 |  |  | 220 |  |  | 124 |
Income tax provision (benefit) | $ | 314 |  |  | $ | 1,572 |  |  | $ | (439) |
Schedule of Income before Income Tax, Domestic and Foreign | The domestic and foreign components of income before income taxes were:
| Fiscal Year Ended
| July 2, 2022 |  | July 3, 2021 |  | June 27, 2020
| (in thousands)
Domestic | $ | (2,890) |  |  | $ | 2,839 |  |  | $ | 1,142 |
Foreign | 6,581 |  |  | 3,074 |  |  | 3,177 |
Income before income taxes | $ | 3,691 |  |  | $ | 5,913 |  |  | $ | 4,319 |
Schedule of Deferred Tax Assets and Liabilities | Deferred income tax assets and liabilities consist of the following at:
| July 2, 2022 |  | July 3, 2021
| (in thousands)
Deferred tax assets: |  |  |
Net operating loss | $ | 486 |  |  | $ | 465 |
Tax credit carryforwards, net | 7,990 |  |  | 3,581 |
Inventory | 247 |  |  | 1,190 |
Identifiable intangibles | 370 |  |  | 432 |
Accruals | 2,406 |  |  | 3,132 |
Fixed assets | 1,200 |  |  | — |
ASC 606 deferred costs | 4,216 |  |  | 4,670 |
Lease liabilities | 3,671 |  |  | 2,909 |
Interest expense deduction carryforward | 580 |  |  | — |
Other | 465 |  |  | 385 |
Deferred income tax assets | $ | 21,631 |  |  | $ | 16,764 |
Deferred tax liabilities: |  |  |
Accrued withholding tax - unremitted earnings | (754) |  |  | (754) |
Fixed assets | — |  |  | (794) |
Right-of-use assets | (3,663) |  |  | (2,930) |
Tax capital lease liabilities | (2,385) |  |  | — |
Mark-to-market adjustments | — |  |  | (816) |
ASC 606 accelerated revenue | (3,736) |  |  | (672) |
Other | (1,102) |  |  | (1,142) |
Deferred income tax liabilities | $ | (11,640) |  |  | $ | (7,108) |
Net deferred income tax assets | $ | 9,991 |  |  | $ | 9,656 |
Balance sheet caption reported in: |  |  |
Long-term deferred income tax asset | $ | 10,055 |  |  | $ | 9,656 |
Long-term deferred income tax liability | (64) |  |  | — |
Net deferred income tax asset | $ | 9,991 |  |  | $ | 9,656 |
Schedule of Unrecognized Tax Benefits Roll Forward | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
| Fiscal Year Ended
| July 2, 2022 |  | July 3, 2021 |  | June 27, 2020
| (in thousands)
Beginning Balance | $ | 4,863 |  |  | $ | 2,863 |  |  | $ | 4,099 |
Additions based on tax positions related to the current year | 286 |  |  | 193 |  |  | 109 |
Adjustment to prior year tax positions & amended tax returns | (2,296) |  |  | 2,102 |  |  | — |
Lapse of statute of limitations | 145 |  |  | (295) |  |  | (1,345) |
Ending Balance | $ | 2,998 |  |  | $ | 4,863 |  |  | $ | 2,863 |

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