XML 65 R14.htm IDEA: XBRL DOCUMENT
v2.4.0.6

TAXES ON INCOME | 12 Months Ended
--- | ---
Dec. 31, 2012
Income Tax Disclosure [Abstract] |
Income Tax Disclosure [Text Block] |
NOTE 8 - | TAXES ON INCOME
| a. | Tax benefits under the Law for the Encouragement of Industry (Taxes), 1969:
The Company is an “industrial company”, as defined by this law. As such, the Company is entitled to claim depreciation at increased rates for equipment used in industrial activity, as stipulated by regulations published under the inflationary adjustments law.
| b. | Tax benefits under the Law for the Encouragement of Capital Investments, 1959:
| 1) | Tax benefits prior to the 2011 Amendment
Substantially all of the Company’s production facilities have been granted “approved enterprise” status under the above law (including Amendment No. 60 to the law that was published in April 2005). Income derived from the approved enterprise was tax exempt for a period of ten years commencing in the first year in which the Company earned taxable income from the approved enterprise (provided the maximum period to which it is restricted by law has not elapsed). According to the above law, in the event of distribution of cash dividends from income that was tax exempt as above, the Company would have to pay the 25% tax in respect of the amount distributed. The entitlement to the above benefits was conditional upon the Company’s fulfilling the conditions stipulated by the above law, regulations published thereunder and the certificate of approval for the specific investments in approved enterprises. In the event of failure to comply with these conditions, the benefits may be cancelled and the Company may be required to refund the amount of the benefits, in whole or in part, with the addition of linkage differences to the Israeli CPI and interest.
| 2) | Tax benefits under the 2011 Amendment
On January 6, 2011 an amendment (Amendment No. 68) to the Law for the Encouragement of Capital Investment-1959 ("2011 Amendment") was published.The new Amendment significantly revising the tax incentive regime in Israel, commencing on January, 1 2011. 2011 Amendment introduced a new status of “Preferred Enterprise”. Similarly to the “approved enterprise” status, a Preferred Company is an industrial company meeting certain conditions (including a minimum threshold of 25% export). However, under the New Amendment the requirement for a minimum investment in productive assets in order to be eligible for the benefits granted under the Investments Law as with respect to “approved enerprise”status was cancelled. A Preferred Company is entitled to a reduced flat tax rate with respect to the income attributed to the Preferred Enterprise, at the following rates:
Tax Year |  | Development Region “A” |  |  | Other Areas within Israel |
2011-2012 |  |  | 10 | % |  |  | 15 | %
2013-2014 |  |  | 7 | % |  |  | 12.5 | %
2015 onwards |  |  | 6 | % |  |  | 12 | %
Dividends distributed from income which is attributed to a “Preferred Enterprise” will be subject to withholding tax at source at the following rates: (i) Israeli resident corporations - 0%, (ii) Israeli resident individuals – 15% (iii) non-Israeli residents - 15%, subject to a reduced tax rate under the provisions of an applicable double tax treaty. The Company is located in Development Region "A" and during 2011 had chosen the status of the 2011 Amendment.
| c. | Other applicable tax rates:
| 1) | Income from other sources in Israel
On December 6, 2011, the “Tax Burden Distribution Law” Legislation Amendments (2011) was published in the official gazette, under which the previously approved gradual decrease in corporate tax was cancelled. The corporate tax rate increased to 25% as from 2012.
| 2) | Income of non-Israeli subsidiaries
Non-Israeli subsidiaries are taxed according to tax laws in their countries of residence.
| d. | Deferred income taxes:
| 1) | Provided in respect of the following:
|  | December 31 |
|  | 2 0 1 2 |  |  | 2 0 1 1 |
|  | U.S. dollars in thousands |
Research and development expenses |  | $ | 103 |  |  | $ | 244 |
Allowance for doubtful accounts |  |  | 12 |  |  |  | 10 |
Carryforward tax losses |  |  | 2,074 |  |  |  | 1,723 |
Other |  |  | 24 |  |  |  | 23 |
Less- valuation allowance |  |  | (2,074 | ) |  |  | (1,723 | )
|  | $ | 139 |  |  | $ | 277 |
| 2) | As of December 31, 2012, the carryforward tax losses are related to the company subsidiaries (in the U.S. and U.K.) and amounted to approximately $6.7 million. The Company has provided valuation allowance in respect of deferred tax assets resulting from carryforward tax losses. Management currently believes that it is more likely than not that those deferred tax losses will not be realized in the foreseeable future.
| e. | Taxes on income included in the statements of operations:
| 1) | As follows:
|  | Years ended December 31, |
|  | 2 0 1 2 |  |  | 2 0 1 1 |  |  | 2 0 1 0 |
|  | U.S. dollars in thousands |
Current: |  |  |  |  |  |  |  |  |  |  |  |
In Israel |  | $ | 88 |  |  | $ | 43 |  |  | $ | 72 |
Outside Israel |  |  | 96 |  |  |  | 49 |  |  |  | 62 |
|  |  | 184 |  |  |  | 92 |  |  |  | 134 |
Taxes in respect of previous years |  |  | 70 |  |  |  | - |  |  |  | 54 |
Deferred in Israel |  |  | 138 |  |  |  | (277 | ) |  |  | - |
|  | $ | 392 |  |  | $ | (185 | ) |  | $ | 188 |
| 2) | Following is a reconciliation of the theoretical tax expense, assuming all income is taxed at the regular tax rates applicable to companies in Israel (see c. above), and the actual tax expense:
|  | Years ended December 31, |
|  | 2 0 1 2 |  |  | 2 0 1 1 |  |  | 2 0 1 0 |
|  | U.S. dollars in thousands |
Income before taxes on income, as reported in the statements of operations* |  | $ | 4,670 |  |  | $ | 4,106 |  |  | $ | 5,044 |
Theoretical tax expense |  |  | 1,168 |  |  |  | 985 |  |  |  | 1,261 |
L e s s - tax benefits arising from approved |  |  |  |  |  |  |  |  |  |  |  |
enterprise status, see a. above |  |  | (410 | ) |  |  | - |  |  |  | (489 | )
|  |  | 757 |  |  |  | 985 |  |  |  | 772 |
Increase (decrease) in taxes resulting from permanent differences: |  |  |  |  |  |  |  |  |  |  |  |
Disallowable deductions |  |  | 11 |  |  |  | 18 |  |  |  | 23 |
Taxes in respect of previous years |  |  | 70 |  |  |  | - |  |  |  | 54 |
Changes in valuation allowance |  |  | 351 |  |  |  | (3,283 | ) |  |  | (2,104 | )
Changes in taxes resulting from computation of deferred taxes at a rate which is different from the theoretical rate and other |  |  | (797 | ) |  |  | 2,095 |  |  |  | 1,443 |
Taxes on income for the reported year |  | $ | 392 |  |  | $ | (185 | ) |  | $ | 188 |
* As follows: |  |  |  |  |  |  |  |  |  |  |  |
Taxable in Israel |  | $ | 2,734 |  |  | $ | 3,418 |  |  | $ | 5,168 |
Taxable outside Israel |  |  | 1,936 |  |  |  | 688 |  |  |  | (124 | )
|  | $ | 4,670 |  |  | $ | 4,106 |  |  | $ | 5,044 |
| f. | Tax assessments:
The Company has received final assessments from the tax authorities, through the year ended December 31, 2011. The subsidiaries, except Omni, have not been assessed since incorporation. Omni has received final tax assessments through tax year 2006.

X
- Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -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 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 4: 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 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -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 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration