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Income Taxes | 12 Months Ended
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Mar. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | 7. Income Taxes Income tax expense consists of the following for the years ended March 31:
|  | (In thousands) |
|  | 2024 |  |  | 2023 |
Current: |  |  |  |  |  |
Federal |  | $ | - |  |  | $ | 22 |
State |  |  | - |  |  |  | 10 |
Total current |  |  | - |  |  |  | 32 |
Deferred: |  |  |  |  |  |
Federal |  |  | - |  |  |  | 708 |
State |  |  | - |  |  |  | 677 |
Total deferred |  |  | - |  |  |  | 1,385 |
Income tax expense |  | $ | - |  |  | $ | 1,417 |
The net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes are reflected in deferred income taxes. Significant components of the Company’s deferred tax assets consist of the following as of March 31:
|  | (In thousands) |
Deferred Tax Assets |  | 2024 |  |  | 2023 |
Allowance for credit losses not currently deductible for tax purposes |  | $ | - |  |  | $ | 4,538 |
Unrealized fair value adjustment |  |  | 4,162 |  |  |  | - |
Share-based compensation |  |  | 30 |  |  |  | 20 |
Federal and state net operating loss carryforwards |  |  | 9,816 |  |  |  | 4,812 |
Right of use liability |  |  | 15 |  |  |  | 43 |
Other items |  |  | 50 |  |  |  | 87 |
Valuation allowance |  |  | (14,047 | ) |  |  | (9,457 | )
Total deferred tax assets |  |  | 26 |  |  |  | 43 |
Deferred tax liabilities |  |  |  |  |  |
Right of use asset |  |  | 15 |  |  |  | 43 |
Other items |  |  | 11 |  |  |  | - |
Total deferred tax liabilities |  |  | 26 |  |  |  | 43 |
Deferred income taxes |  | $ | - |  |  | $ | - |
Income tax expense reflects an effective U.S. tax rate, which differs from the corporate tax rate for the following reasons:
|  | (In thousands) |
|  | 2024 |  |  | 2023 |
Income tax benefit at Federal statutory rate |  | $ | (4,355 | ) |  | $ | (6,838 | )
Increase (decrease) resulting from: |  |  |  |  |  |
Change in valuation allowance |  |  | 4,590 |  |  |  | 9,457 |
State income taxes, net of Federal benefit |  |  | (770 | ) |  |  | (1,207 | )
Other |  |  | 535 |  |  |  | 5 |
Income tax expense |  | $ | - |  |  | $ | 1,417 |
Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of negative evidence evaluated was the cumulative pre-tax loss over the three-year period ended March 31, 2024. As of March 31, 2024, a full valuation allowance was recorded against the Company’s net deferred tax asset. The federal net operating loss ("NOL") generated for the year ended March 31, 2024 will carryforward indefinitely. Generally, state NOLs begin to expire March 31, 2039. The Company considers the earnings of the Company’s U.S. subsidiaries to be indefinitely invested outside Canada on the basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs and the Company’s specific plans for reinvestment of those subsidiary earnings. The Company has not recorded a deferred tax liability related to the Canadian income taxes and U.S. withholding taxes on approximately $100.4 million of undistributed earnings of the U.S. subsidiaries indefinitely invested outside Canada. When the Company repatriates the U.S. earnings, it would need to adjust its income tax provision as the earnings will no longer be indefinitely invested outside of Canada. If the Company decided to repatriate the U.S. earnings, it would need to adjust its income tax provision in the period the Company determined that the earnings will no longer be indefinitely invested outside of Canada.

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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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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