|6 Months Ended|
Sep. 30, 2016
|Income Tax Disclosure [Abstract]|
For the six month periods ended September 30, 2016 and 2015, the Company recorded tax expense of $1,823 on pre-tax income of $8,141 and tax expense of $5,508 on pre-tax income of $17,015, respectively. The Company had several discrete tax items during the respective reporting periods. During the six months ended September 30, 2016, the Company had a $379 discrete tax benefit related to the release of deferred tax liabilities that were associated with the final purchase price accounting of its Unitemp acquisition. Since the purchase price was finalized during the year ended March 31, 2016, the tax benefit was recorded as an out-of-period correction. During the six months ended September 30, 2015, the Company accrued an additional deferred tax liability of $455 due to an increase in the provincial tax rate in Alberta, Canada. The deferred tax liability relates primarily to amortizing and indefinite life intangible assets allocated to our Canadian subsidiary. Our anticipated annual effective tax rate before discrete events is approximately 26.7% and has been applied to our consolidated pre-tax income for the six months ended September 30, 2016. For the six months ended September 30, 2015, our tax provision reflected an annual effective tax rate before discrete events of 29.4%.
We have adopted a permanent reinvestment position whereby we expect to reinvest our foreign earnings for most of our foreign subsidiaries and do not expect to repatriate future earnings. As a result of the adoption of a permanent reinvestment position, we do not accrue a tax liability in anticipation of future dividends from most of our foreign subsidiaries. The estimated annual effective tax rate for the fiscal year ending March 31, 2017 reflects the estimated taxable earnings of our various foreign subsidiaries and the applicable local tax rates, after accounting for certain permanent differences, such as non-deductible compensation expense.
As of September 30, 2016, we have established a long-term liability for uncertain tax positions in the amount of $688, all of which is related to the IPI acquisition. During the six months ended September 30, 2016, the Company recognized related accrued interest and penalties of $27 as income tax expense related to our current uncertain tax positions. We expect that $176 of this reserve will be released during the three months ending December 31, 2016 as a discrete tax benefit.
As of September 30, 2016, the tax years for fiscal 2013 through fiscal 2016 remain open to examination by the major taxing jurisdictions to which we are subject.
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/presentationRef