Enom 2015 Annual Report Download - page 47

45
December 31, 2014 and 2013. We reclassified the following activity in our consolidated statements of operations from
continuing operations to discontinued operations (in thousands):
Year ended December 31,
2014
2013
Service revenue .........................................................
$
107,721
$
185,187
Service costs ..........................................................
92,588
143,607
Sales and marketing ....................................................
5,632
10,170
Product and development ...............................................
8,203
12,002
General and administrative ..............................................
14,819
20,263
Amortization of intangible assets .........................................
4,243
7,890
Total operating expenses ...............................................
125,485
193,932
Operating loss ..........................................................
(17,764)
(8,745)
Other income (expense), net ..............................................
7,017
4,174
Loss before income taxes .................................................
$
(10,747)
$
(4,571)
Income tax expense .....................................................
(461)
(1,385)
Net loss ...............................................................
$
(11,208)
$
(5,956)
Income Taxes
We account for our income taxes using the liability and asset method, which requires the recognition of deferred
tax assets and liabilities for the expected future tax consequences of events that have been recognized in our financial
statements or in our tax returns. In estimating future tax consequences, generally all expected future events other than
enactments or changes in the tax law or rates are considered. Deferred income taxes are recognized for differences
between financial reporting and tax bases of assets and liabilities at the enacted statutory tax rates in effect for the years
in which the temporary differences are expected to reverse. The effect on deferred taxes of a change in tax rates is
recognized in income in the period that includes the enactment date. We evaluate the realizability of our deferred tax
assets, and valuation allowances are provided when necessary to reduce deferred tax assets to the amounts expected to be
realized.
We operate in various tax jurisdictions and are subject to audit by various tax authorities. We believe any
adjustments that may ultimately be required as a result of any of these audits will not be material to our consolidated
financial statements.
We recognize a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will
be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits
recognized in the consolidated financial statements from such positions are then measured based on the largest benefit
that has a greater than 50% likelihood of being realized upon settlement. We recognize interest and penalties accrued
related to unrecognized tax benefits in our income tax (benefit) provision in the accompanying consolidated statements
of operations. Our evaluations of uncertain tax positions are based upon their technical merits, and relevant tax law and
the specific facts and circumstances as of each reporting period. Changes in facts and circumstances could result in
material changes to the amounts recorded for such tax contingencies.
We calculate our current and deferred tax provision based on estimates and assumptions that could differ from the
actual results reflected in income tax returns filed in subsequent years. Adjustments based on filed returns are recorded
when identified. The amount of income taxes we pay is subject to ongoing audits by federal, state and foreign tax
authorities. Our estimate of the potential outcome of any uncertain tax issue is subject to management’s assessment of
relevant risks, facts, and circumstances existing at that time. To the extent that our assessment of such tax positions
changes, the change in estimate is recorded in the period in which the determination is made.