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73
expense when the related product is released and the related net sales are recognized. In fiscal 2010, 2009
and 2008, we incurred amortization expense of $0.1 million, $0.4 million, and $0.5 million, respectively,
related to these warrants. Additionally, the recoverability of intellectual property licenses is evaluated on a
quarterly basis with amounts determined as not recoverable being charged to expense. In connection with
the evaluation of capitalized intellectual property licenses, any capitalized amounts for related third-party
stock warrants are additionally reviewed for recoverability with amounts determined as not recoverable being
amortized to expense.
19. Income Taxes
United States and foreign income (loss) before taxes and details of the provision for income tax were as
follows (in thousands):
Fiscal Year Ended March 31,
2010
2009
2008
Income (loss) from continuing operations before income taxes:
United States..................................................................................................... $(26,470) $(384,363) $(99,868)
Foreign ............................................................................................................... 14,765 (2,867) 27,233
$(11,705) $(387,230) $(72,635)
Provision for income tax expense (benefit):
Current
Federal............................................................................................................ $(4,302) $1,734 $(4,552)
State ............................................................................................................... 316 90 (102)
Foreign............................................................................................................ 3,487 10,461 13,601
Total current................................................................................................... (499) 12,285 8,947
Deferred
Federal............................................................................................................ 1,337 24,478 (33,930)
State ............................................................................................................... — 11,294 (6,317)
Foreign............................................................................................................ (591)
(1,831) (4,485)
Total deferred ................................................................................................ 746 33,941 (44,732)
Provision for income tax expense (benefit)....................................................... $247 $46,226 $(35,785)
The differences between the U.S. federal statutory tax rate and our effective tax rate, expressed as a
percentage of income (loss) from continuing operations before income taxes were as follows:
Fiscal Year Ended March 31,
2010
2009
2008
U.S. federal statutory tax rate ........................................................................................... (35.0)% (35.0)% (35.0)%
Impact of changes in unrecognized tax benefits........................................................... (2.7) (0.3) (6.4)
State taxes, net of federal impact .................................................................................... 1.8 1.9 (5.7)
Tax exempt interest income .............................................................................................. (0.7) (0.3) (3.3)
Research and development credits ................................................................................. (14.6) (0.6) (3.2)
Non-deductible stock-based compensation.................................................................... (0.2) 0.2 2.8
Valuation allowance ........................................................................................................... 46.0 36.5 —
Capital losses ...................................................................................................................... (30.1) — —
Rate differences in foreign taxes and other ................................................................... 37.6 9.6 1.5
Effective tax rate ................................................................................................................. 2.1% 12.0% (49.3)%