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Form 10-K
The following is a reconciliation of the standard U.S. statutory tax rate and the Company’s
effective tax rate:
2010 2009 2008
Year Ended June 30,
U.S. federal statutory income tax rate . . . . . . . . . . . . . . . . . . . . . 34.0% 34.0% 34.0%
State taxes, net of federal effect. . . . . . . . . . . . . . . . . . . . . . . . . . 1.0% 1.0% 0.3%
Foreign rate differential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (26.0)% (25.8)% (23.9)%
Increase in valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3% 0.0% 0.0%
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.6)% (0.3)% (0.7)%
Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.7% 8.9% 9.7%
The following is a summary of the Company’s income before taxes by geography:
2010 2009 2008
Year Ended June 30,
U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10,250 $ 9,402 $ 8,068
Non-U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,764 51,701 36,024
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 75,014 $ 61,103 $ 44,092
Significant components of the Company’s deferred income tax assets and liabilities consist of
the following at June 30, 2010 and 2009:
2010 2009
Year Ended
June 30,
Deferred tax assets:
Net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,312 $ 887
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 761 316
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,245 624
Shared-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,923 6,259
Corporate minimum tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167 378
R&D credit carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 330 657
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,738 9,121
Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (944) —
Total deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,794 9,121
Deferred tax liabilities:
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,401) (3,099)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (22) —
Total deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,423) (3,099)
Net deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,371 $ 6,022
The current portion of the net deferred taxes at June 30, 2010 and 2009 was an asset of
$1,245 and $624, respectively, which is included in prepaid expenses and other current assets in the
accompanying consolidated balance sheets.
In assessing the realizability of deferred tax assets, the Company considers whether it is more
likely than not that some portion or all of the deferred tax assets will not be realized. No valuation
allowance has been recorded against the $5,923 deferred tax asset associated with share-based
compensation charges at June 30, 2010. However, in the future, if the underlying awards expire, are
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