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10-K
http://www.sec.gov/Archives/edgar/data/949373/000119312513085036/d445565d10k.htm[9/11/2014 10:07:50 AM]
Effect of change in tax rate 0.7% 0.0% 0.0%
Series Z 1.9% 0.0% 0.0%
Other, net 4.8% (1.6%) 0.5%
49.0% 37.6% 61.9%
Change in valuation allowance (0.7%) 0.0% (23.0%)
Effective income tax rate 48.3% 37.6% 38.9%
The Company’ s total deferred tax assets and liabilities are as follows:
January 3,
2012
January 1,
2013
(in thousands)
Deferred tax assets $ 60,258 $ 50,744
Deferred tax liabilities (16,652) (19,828)
43,606 30,916
Valuation allowance (4,790) —
Total deferred tax assets, net $ 38,816 $ 30,916
During fiscal 2012, the Company changed its presentation of the income tax effects of approximately $12.2 million of NOL carryforwards as
the gross deferred tax asset exceeded the amount permissible to be used under
75
Table of Contents
EINSTEIN NOAH RESTAURANT GROUP, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
tax law. Accordingly, the Company wrote-off these NOL carryforwards and reversed the related valuation allowance of $4.8 million. There was no
impact to the Company’ s income tax provision or to its total deferred tax assets as a result of this adjustment.
The income tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities are as follows:
January 3,
2012
January 1,
2013
(in thousands)
Current deferred tax assets and liabilities, net
Operating loss carryforwards $ 7,234 $ 5,537
Deferred revenue 164 212
Accrued expenses, net 2,372 2,536
Other 29 (95)
Total gross current deferred tax assets, net of liabilities 9,799 8,190
Valuation allowance (786) —
Total current deferred tax assets, net 9,013 8,190
Long-term deferred tax assets and liabilities, net
Operating loss carryforwards, net of unrecognized tax benefits 33,165 25,728
Property, plant and equipment 12,151 10,881
Intangible assets (16,561) (19,252)
Deferred rent 1,869 2,060
Stock-based compensation 1,963 2,260
Federal tax credits 866 1,063
Other 354 (14)
Total gross long-term deferred tax assets, net of liabilities 33,807 22,726
Valuation allowance (4,004) —
Total long-term deferred tax assets, net 29,803 22,726
Total deferred tax assets, net $ 38,816 $ 30,916
The Company’ s continued utilization of its NOL carryforwards reduces its income tax liabilities. As of January 3, 2012 and January 1, 2013,
the Company had $0.1 million and $0.4 million, respectively, of federal and state income tax overpayments recorded within prepaid expenses on
the consolidated balance sheet.