Vistaprint 2008 Annual Report Download - page 86

VISTAPRINT LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Years Ended June 30, 2008, 2007 and 2006
(in thousands, except share and per share data)
The following is a reconciliation of the standard U.S. statutory tax rate and the Company’s
effective tax rate:
Year Ended June 30,
2008 2007 2006
U.S. federal statutory income tax rate ................................... 34.0% 34.0% 34.0%
State taxes ........................................................... 0.3% 1.0% 0.0%
Tax reserve reversal ................................................... 0.0% 0.0% (4.7)%
Foreign rate differential ................................................ (23.9)% (24.4)% (26.6)%
Other................................................................. (0.7)% (1.0)% 1.2%
Effective income tax rate ............................................... 9.7% 9.6% 3.9%
The following is a summary of the Company’s income before taxes by geography:
Year Ended June 30,
2008 2007 2006
U.S............................................................... $ 8,068 $ 4,107 $ 2,249
Non-U.S. ......................................................... 36,024 25,916 17,769
Total ............................................................. $44,092 $30,023 $20,018
Significant components of the Company’s deferred tax assets and liabilities, which are primarily
related to its United States subsidiary, for income taxes consist of the following at June 30, 2008 and
2007:
Year Ended
June 30,
2008 2007
Deferred tax assets:
Net operating loss carryforwards .......................................... $ 595 $ 1,452
Accrued expenses ....................................................... 608 528
Share-based compensation............................................... 2,641 —
Corporate minimum tax .................................................. 210 —
R&D credit carryforwards ................................................. 150 —
Total deferred tax assets ............................................. 4,204 1,980
Deferred tax liabilities:
Depreciation and amortization ............................................ (2,827) (2,544)
Total deferred tax liabilities ........................................... (2,827) (2,544)
Net deferred taxes ........................................................... $ 1,377 $ (564)
The current portion of the net deferred taxes at June 30, 2008 and 2007 was an asset of $1,076
and $661, respectively, which is included in prepaid and other current assets in the accompanying
consolidated balance sheets.
In assessing the realizability of deferred tax assets in accordance with SFAS No. 109, the
Company considers whether it is more likely than not that some portion or all of the deferred tax assets
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