Plantronics 1998 Annual Report Download - page 19

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Notes TO CONSOLIDATED
FINANCIAL STATEMENTS
NOTE. 6INCOME TAXES:
Income tax expense for fiscal 1996, 1997 and 1998 consisted of the following:
FISCAL YEAR ENDED MARCH ,
(IN THOUSANDS)1996 19 9 7 1998
Federal
Current $13,586 $ 8,744 $10,109
Deferred (827) 2,789 4,746
State 1,622 1,854 1,472
Foreign 1,903 1,899 2,116
$16,284 $15,286 $18,443
Pre-tax earnings of the foreign subsidiaries were $2.8 million, $8.2 million and $15.7 million for fiscal years 1996, 1997
and 1998, respectively. Cumulative earnings of foreign subsidiaries which have been permanently reinvested as of
March 31, 1998 totaled $5.5 million.
The following is a reconciliation between statutory federal income taxes and the total provision for taxes on pre-tax income:
FISCAL YEAR ENDED MARCH ,
(IN THOUSANDS)1996 19 9 7 1998
Tax expense at statutory rate $14,614 $15,735 $20,171
Foreign operations taxed at different rates 910 (971) (4,364)
State taxes, net of federal benefit 1,054 1,204 1,476
Other, net (294) (682) 1,160
$16,284 $15,286 $18,443
Deferred tax liabilities (assets) represent the tax effects of temporary differences between the carrying amounts of assets
and liabilities for financial reporting and income tax purposes. Significant components of the Company’s deferred tax
liabilities and assets are as follows:
MARCH ,
(IN THOUSANDS)1997 1998
Deferred gains on sales of properties $ 2,740 $ 2,476
Deferred state tax —314
Unremitted earnings of certain subsidiaries —5,749
Other deferred tax liabilities 333 1,111
Gross deferred tax liabilities 3,073 9,650
Accruals and other reserves (2,748) (5,670)
Deferred state tax deduction (635) —
Other deferred tax assets (914) (458)
Gross deferred tax assets (4,297) (6,128)
Total net deferred tax liabilities $(1,224) $ 3,522
P.11
PLANTRONICS
ANNUAL REPORT . 199 8