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These excerpts taken from the CLZR 10-Q filed May 7, 2009. 16. Income Taxes
The Company adopted the provisions of FIN 48 effective July 1, 2007. FIN 48 addresses the accounting for and disclosure of uncertainty in income tax positions by prescribing a minimum recognition threshold that a tax position is required to satisfy before being recognized in the financial statements. FIN 48 also provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.
The cumulative effect of adopting FIN 48 was a decrease in tax reserves of approximately $0.1 million, resulting in an offsetting increase to the July 1, 2007 Retained Earnings balance.
The Company files income tax returns in the United States (“U.S.”) on a federal basis and in many U.S. state and foreign jurisdictions. The three most significant tax jurisdictions are the U.S., Spain, and Japan. The associated tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. The fiscal years ended 2006 and later remain subject to examination by the IRS for U.S. federal tax purposes, our fiscal years ended 2005 and later remain subject to examination by the appropriate governmental agencies for Spanish and Japanese tax purposes.
In connection with the preparation of the financial statements, the Company performed an analysis to ascertain if it was more likely than not that it would be able to utilize its net deferred tax assets of approximately $16.9 million.
As part of that analysis, management considered the following as positive evidence outweighing the negative evidence of the recent pre-tax book losses:
· The net temporary differences resulting in the deferred tax assets and in the deferred tax liabilities are expected to reverse in similar time periods.
· The Company has a consistent taxpaying history.
· Current projections of future taxable income, exclusive of reversing temporary differences, indicate a return to taxable income in a reasonable period of time.
Based upon the aforementioned, we have concluded that the positive evidence outweighs the negative evidence and, thus, that those deferred tax assets not otherwise subject to a valuation allowance are realizable on a “more likely than not” basis.
Income
Taxes. The
(benefit) provision for income taxes results from a combination of activities
of the Company and its domestic and foreign subsidiaries. We recorded effective
tax rates of approximately 36% and 32% for each of the nine-month periods ended
March 28, 2009 and March 29, 2008, respectively. The effective tax
rate for the period ended March 28, 2009 differs from the statutory rate
primarily due to state taxes, differences in foreign tax rates, R&D credits
and other permanent items. The effective rate for the period ended March 29,
2008 differs from the statutory rate primarily due to state taxes, differences
in foreign tax rates and other permanent items. The foreign rate difference is
due to income reported in a high tax rate jurisdiction combined with losses
benefited in a jurisdiction with a lower tax rate.
The Company also recorded a discrete tax benefit during the nine months ended March 28, 2009 for the effect of the reinstatement of the R&D credit in the US. During the nine month period ended March 29, 2008 the Company reported a discrete expense item of $0.1 million resulting from a change in the statutory tax rate in Germany. The effect of the change in the German statutory rate on current earnings is fully reflected in our effective tax rate indicated above.
These excerpts taken from the CLZR 10-Q filed Feb 5, 2009. 15. Income Taxes
The Company adopted the provisions of FIN 48 effective July 1, 2007. FIN 48 addresses the accounting for and disclosure of uncertainty in income tax positions by prescribing a minimum recognition threshold that a tax position is required to satisfy before being recognized in the financial statements. FIN 48 also provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.
The cumulative effect of adopting FIN 48 was a decrease in tax reserves of approximately $0.1 million, resulting in an offsetting increase to the July 1, 2007 Retained Earnings balance.
The Company files income tax returns in the United States (“U.S.”) on a federal basis and in many U.S. state and foreign jurisdictions. The three most significant tax jurisdictions are the U.S., Spain, and Japan. The associated tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. The 2006 and 2007 fiscal tax years remain subject to examination by the IRS for U.S. federal tax purposes, our 2004 through 2007 fiscal tax years remain subject to examination by the appropriate governmental agencies for Spanish and Japanese tax purposes.
Income
Taxes. The (benefit) provision for income taxes results
from a combination of activities of the Company and its domestic and foreign
subsidiaries. We recorded effective tax rates of approximately 36% and 30% for
each of the six-month periods ended December 27, 2008 and December 29,
2007, respectively. The effective tax rate for the period ended December 27,
2008 differs from the statutory rate primarily due to differences in foreign
tax rates, R&D credits and other permanent items. The effective rate for
the period ended December 29, 2007 differs from the statutory rate
primarily due to differences in foreign tax rates and other permanent items.
The foreign rate difference is due to income reported in a high tax rate
jurisdiction combined with losses benefited in a jurisdiction with a lower tax
rate.
The Company also recorded a discrete tax benefit during the six months ended December 27, 2008 for the effect of the reinstatement of the R&D credit in the US. During the six month period ended December 29, 2007 the Company reported a discrete expense item of $0.1 million resulting from a change in the statutory tax rate in Germany. The effect of the change in the German statutory rate on current earnings is fully reflected in our effective tax rate indicated above.
This excerpt taken from the CLZR 10-Q filed Nov 6, 2008. Income
Taxes. The (benefit) provision for income taxes results
from a combination of activities of the Company and its domestic and foreign
subsidiaries. We recorded effective tax rates of approximately 45% and 34% for
each of the three-month periods ended September 27, 2008 and September 29,
2007, respectively. The effective tax rate for the period ended September 27,
2008 differs from the statutory rate primarily due to differences in foreign
tax rates and other permanent items. The foreign rate difference is due to
income reported in a high tax rate jurisdiction combined with losses benefited
in a jurisdiction with a lower tax rate. The effective rate for the period
ended September 29, 2007 differs from the statutory rate primarily due to
differences in foreign tax rates, R&D credits and other permanent items.
The Company also recorded a discrete tax expense item during the three-month period ended September 29, 2007 of $0.1 million resulting from a change in the statutory tax rate in Germany. The effect of the change in the German statutory rate on current earnings is fully reflected in our effective tax rate indicated above.
This excerpt taken from the CLZR 10-Q filed May 8, 2008. 16. Income Taxes The Company adopted the provisions of FIN 48 effective July 1, 2007. FIN 48 addresses the accounting for and disclosure of uncertainty in income tax positions by prescribing a minimum recognition threshold that a tax position is required to satisfy before being recognized in the financial statements. FIN 48 also provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The cumulative effect of adopting FIN 48 was a decrease in tax reserves of approximately $0.1 million, resulting in an offsetting increase to the July 1, 2007 Retained Earnings balance. Upon adoption, the gross liability for unrecognized tax benefits at July 1, 2007 was approximately $1.9 million, exclusive of interest and penalties and, if recognized, would favorably affect the Company's effective tax rate. In addition, consistent with the provisions of FIN 48, certain reclassifications were made to the balance sheet, including the reclassification of $0.4 million of income tax liabilities from current to non-current liabilities because payment of cash is not anticipated within one year of the balance sheet date. The Company's policy to include interest and penalties related to gross unrecognized tax benefits within its provision for income taxes did not change upon the adoption of FIN 48. To the extent 14 accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced in the period that such determination is made and reflected as a reduction of the overall income tax provision. The Company files income tax returns in the United States ("U.S.") on a federal basis and in many U.S. state and foreign jurisdictions. The three most significant tax jurisdictions are the U.S., Spain, and Japan. The associated tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. The 2006 and 2007 fiscal tax years remain subject to examination by the IRS for U.S. federal tax purposes, and the 2004 through 2007 fiscal tax years remain subject to examination by the appropriate governmental agencies for Spanish and Japanese tax purposes, respectively. This excerpt taken from the CLZR 10-Q filed Feb 7, 2008. Income
Taxes. The provision for income taxes results from a
combination of activities of the Company and its domestic and foreign
subsidiaries. We recorded effective tax rates of approximately 30% and 37% for
each of the six -month periods ended December 29, 2007 and December 30,
2006, respectively. The Company also recorded discrete tax items of
approximately $0.3 million during the six-month period ended December 29,
2007. The discrete items include an expense of $0.1 million resulting from a
change in the statutory tax rate in Germany and a benefit of $0.4 million
resulting from the completion of an IRS audit of the 2005 and 2004 income tax
returns. The affect of the change in the German statutory rate on current
earnings is fully reflected in our effective tax rate indicated above.
This excerpt taken from the CLZR 10-Q filed Nov 8, 2007. 16. Income Taxes We adopted the provisions of FIN 48 effective July 1, 2007. FIN 48 addresses the accounting for and disclosure of uncertainty in income tax positions by prescribing a minimum recognition threshold that a tax position is required to satisfy before being recognized in the financial statements. FIN 48 also provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. 14 The cumulative effect of adopting FIN 48 was a decrease in tax reserves of approximately $0.1 million, resulting in an offsetting increase to the July 1, 2007 Retained Earnings balance. Upon adoption, the gross liability for unrecognized tax benefits at July 1, 2007 was approximately $1.9 million, exclusive of interest and penalties and, if recognized, would favorably affect our effective tax rate. In addition, consistent with the provisions of FIN 48, certain reclassifications were made to the balance sheet, including the reclassification of $0.4 million of income tax liabilities from current to non-current liabilities because payment of cash is not anticipated within one year of the balance sheet date. Our policy to include interest and penalties related to gross unrecognized tax benefits within our provision for income taxes did not change upon the adoption of FIN 48. To the extent accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced in the period that such determination is made and reflected as a reduction of the overall income tax provision. We file income tax returns in the United States ("U.S.") on a federal basis and in many U.S. state and foreign jurisdictions. Our three most significant tax jurisdictions are the U.S., Spain, and Japan. Our tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. Our 2004 through 2007 fiscal tax years remain subject to examination by the IRS for U.S. federal tax purposes, and our 2004 through 2007 and our 2003 through 2007 fiscal tax years remain subject to examination by the appropriate governmental agencies for Spanish and Japanese tax purposes, respectively. This excerpt taken from the CLZR 10-K filed Sep 13, 2007. Income Taxes. The
Company accounts for income taxes using an asset and liability approach that
requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been recognized in the
financial statements or tax returns. In estimating future tax consequences, all
expected future events are considered other than enactments of changes in tax
laws or rates. Valuation allowances are established as necessary to reduce
deferred tax assets in the event that realization of the assets is considered
unlikely.
This excerpt taken from the CLZR 10-Q filed May 10, 2007. Income Taxes.
The provision for income taxes results from a combination of activities of the
Company and its domestic and foreign subsidiaries. We recorded effective tax
rates of approximately 37% for each of the three-month periods ended March 31,
2007 and April 1, 2006, respectively. We recorded effective tax rates of
approximately 36% and 35% for the nine-month periods ended March 31, 2007 and
April 1, 2006, respectively. The
increase was due primarily to the phase out of the extraterritorial income
exclusion deduction in fiscal year 2007 and a decrease in the valuation
allowances for foreign jurisdictions in the same period in the previous year,
offset slightly by a retroactive reinstatement of the domestic research &
development tax credit.
This excerpt taken from the CLZR 10-Q filed Feb 6, 2007. Income
Taxes. The provision for income taxes results from a combination
of activities of both the domestic and foreign subsidiaries of the Company. We
recorded effective tax rates of approximately 32% and 34% for the three-month
periods ended December 30, 2006 and December 31, 2005, respectively. The
decrease was due primarily to the retroactive reinstatement of the domestic
research & development (“R&D”) tax credit. We recorded effective tax
rates of approximately 36% and 34% for the six-month periods ended December 30,
2006 and December 31, 2005, respectively. The increase was due primarily to the
phase out of the extraterritorial income exclusion deduction in fiscal year
2007 and a decrease in the valuation allowances for foreign jurisdictions in
the same quarter in the previous year, offset slightly by the retroactive
reinstatement of the R&D tax credit mentioned above.
This excerpt taken from the CLZR 10-Q filed Nov 1, 2006. Income
Taxes. The provision for income taxes results from a
combination of activities of both the domestic operations and foreign
subsidiaries of the Company. We recorded
a 37% effective tax rate for the three-month period ended September 30, 2006
compared to a 33% effective rate for the three-month period ended October 1,
2005. The increase in the rate is was
due to the phase out of the extraterritorial income exclusion deduction in
fiscal year 2007 and a release of the valuation allowances for foreign
jurisdictions in the same quarter in the previous year.
This excerpt taken from the CLZR 10-K filed Sep 13, 2006. Income Taxes The Company accounts for income taxes using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or tax returns. In estimating future tax consequences, all expected future events are considered other than enactments of changes in tax laws or rates. Valuation allowances are established as necessary to reduce deferred tax assets in the event that realization of the assets is considered unlikely. 49 This excerpt taken from the CLZR 10-Q filed May 10, 2006. Income
Taxes. The provision for income taxes results from a
combination of activities of both the domestic and foreign subsidiaries of the
Company. The Company recorded a 37% effective tax rate for the three-month
period ended April 2, 2006, which brought the Company’s nine-month effective
tax rate to approximately 35%. This compares to the three-month and nine-month period
ended April 2, 2005, in which the Company recorded a 32% effective rate. The
provision for income taxes differs from the U.S. statutory rate as a result of tax
provisions calculated for income generated by foreign subsidiaries at a rate that
differs from the U.S. statutory rate.
18
Discontinued Operations
On September 27, 2003, we permanently closed our only remaining skin care center, which was located in Boston. The closure of the Boston skin care center, together with the earlier closing of our Scottsdale, Arizona spa, and the associated cessation of this line of business, is accounted for as discontinued operations. As a result of the closure of the Boston skin care center, in the fiscal quarter ended September 27, 2003, we recorded a $2.1 million charge for the accrual of $3.0 million of future occupancy costs and $0.3 million of severance obligations and other related costs of closure, net of anticipated tax benefits of $1.3 million. In addition, both the financial statements for the three months ended October 2, 2004 and all prior financial statements have been restated to reflect skin care center operations as discontinued. During the three-month period ended October 2, 2004, the landlord for the Boston facility secured a sublease for that property. The Company was not able to determine the future economic benefit of the sublease at that time. The sublessee commenced making payments to the landlord during December of 2004. As a result of these and future payments scheduled under the sublease, the Company revised the estimated future costs associated with the Boston facility and, in the quarter ended January 1, 2005, reversed approximately $0.9 million of the restructuring reserve. This reversal represents the anticipated economic benefit due to sublessee payments of $1.7 million, net of legal and other fees of approximately $0.3 million, and income taxes of approximately $0.5 million.
The Company believes that the remaining accrual is sufficient to cover all future leasehold expenses for the remainder of the lease term. These expenses could potentially increase if the sublessee were not to honor its leasehold obligations.
This excerpt taken from the CLZR 10-Q filed Feb 8, 2006. Income Taxes. The
provision for income taxes results from a combination of activities of both the
domestic and foreign subsidiaries of the Company. Excluding discontinued operations, we
recorded approximately a 34% effective tax rate for both the three and six-month
periods ended December 31, 2005, compared to the three and six-month periods
ended January 1, 2005, in which we recorded a 32% effective tax rate. The provision for income taxes differs from
the U.S. statutory rate as a result of tax provisions calculated for income
generated by foreign subsidiaries at a rate that differs from the U.S.
statutory rate.
Discontinued Operations
On September 27, 2003, we permanently closed our only remaining skin care center, which was located in Boston. The closure of the Boston skin care center, together with the earlier closing of our Scottsdale, Arizona spa, and the associated cessation of this line of business, is accounted for as discontinued operations. As a result of the closure of the Boston skin care center, in the fiscal quarter ended September 27, 2003, we recorded a $2.1 million charge for the accrual of $3.0 million of future occupancy costs and $0.3 million of severance obligations and other related costs of closure, net of anticipated tax benefits of $1.3 million. In addition, both the financial statements for the three months ended October 2, 2004 and all prior financial statements have been restated to reflect skin care center operations as discontinued. During the three-month period ended October 2, 2004, the landlord for the Boston facility secured a sublease for that property. The Company was not able to determine the future economic benefit of the sublease at that time. The sublessee commenced making payments to the landlord during December of 2004. As a result of these and future payments scheduled under the sublease, the Company revised the estimated future costs associated with the Boston facility and, in the quarter ended January 1, 2005, reversed approximately $0.9 million of the restructuring reserve. This reversal represents the anticipated economic benefit due to sublessee payments of $1.7 million, net of legal and other fees of approximately $0.3 million, and income taxes of approximately $0.5 million.
The Company believes that the remaining accrual is sufficient to cover all future leasehold expenses for the remainder of the lease term. These expenses could potentially increase if the sublessee were not to honor its obligation.
18
This excerpt taken from the CLZR 10-Q filed Nov 9, 2005. Income
Taxes. The provision for income taxes results from a
combination of activities of both the domestic operations and foreign
subsidiaries of the Company. We recorded
a 33% effective tax rate for the three-month period ended October 1,
2005. This compares to the three-month
period ended October 2, 2004, in which we recorded a 32% effective tax
rate. The provision for income taxes for
the three months ended October 1, 2005 differs from the U.S. statutory
rate as a result of tax provisions calculated for income generated by foreign
subsidiaries at a rate that differs from the U.S. statutory rate.
This excerpt taken from the CLZR 10-K filed Sep 30, 2005. Income Taxes The Company accounts for income taxes using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or tax returns. In estimating future tax consequences, all expected future events are considered other than enactments of changes in tax laws or rates. Valuation allowances are established as necessary to reduce deferred tax assets in the event that realization of the assets is considered unlikely. This excerpt taken from the CLZR 10-Q filed May 9, 2005. Income Taxes.
The provision for income taxes results from a combination of activities of both
the domestic and foreign subsidiaries of the Company. Excluding discontinued operations, we
recorded a 32% effective tax rate for the three-month period ended April 2,
2005, which brought our nine-month effective tax rate to approximately
32%. This compares to the three-month
period ended March 27, 2004, in which we recorded a 34% effective rate,
which brought our nine-month effective tax rate to approximately 32%. The provision for income taxes differs from
the U.S. statutory rate as a result of tax provisions calculated for income
generated by foreign subsidiaries at a rate that differs from the U.S.
statutory rate.
15
Discontinued Operations
On September 27, 2003, we permanently closed our only remaining skin care center, which was located in Boston. The closure of the Boston skin care center, together with the earlier closing of our Scottsdale, Arizona spa, and the associated cessation of this line of business, is accounted for as discontinued operations. As a result of the closure of the Boston skin care center, in the fiscal quarter ended September 27, 2003, we recorded a $2.1 million charge for the accrual of $3.0 million of future occupancy costs and $0.3 million of severance obligations and other related costs of closure, net of anticipated tax benefits of $1.3 million. In addition, both the financial statements for the three months ended October 2, 2004 and all prior financial statements have been restated to reflect skin care center operations as discontinued. During the three-month period ended October 2, 2004, the landlord for the Boston facility secured a sublease for that property. The Company was not able to determine the future economic benefit of the sublease at that time. The sublessee commenced making payments to the landlord during December of 2004. As a result of these and future payments scheduled under the sublease, the Company revised the estimated future costs associated with the Boston facility and, in the quarter ended January 1, 2005, reversed approximately $859 of the restructuring reserve. This reversal represents the aforementioned anticipated economic benefit due to sublessee payments of $1,703, net of legal and other fees of approximately $329 and income taxes of approximately $515, and was recognized in the three-month period ended January 1, 2005.
The Company believes that the size of the remaining accrual is sufficient to cover all future leasehold expenses for the remainder of the lease term. These expenses could potentially increase if the sublessee were not to honor its obligation.
This excerpt taken from the CLZR 10-Q filed Feb 9, 2005. Income
Taxes. The provision for income taxes results from a
combination of activities of both the domestic and foreign subsidiaries of the
Company. Excluding discontinued
operations, we recorded a 32% effective tax rate for both the three- and six-month
periods ended January 1, 2005, compared to the three- and six-month periods
ended December 27, 2003, in which we recorded a 29% effective tax rate. The provision for income taxes differs from
the U.S. statutory rate as a result of tax provisions calculated for income
generated by foreign subsidiaries at a rate that differs from the U.S.
statutory rate.
Discontinued Operations
On September 27, 2003, we permanently closed our only remaining skin care center, which was located in Boston. The closure of the Boston skin care center, together with the earlier closing of our Scottsdale, Arizona spa, and the associated cessation of this line of business, is accounted for as discontinued operations. As a result of the closure of the Boston skin care center, in the fiscal quarter ended September 27, 2003, we recorded a $2.1 million charge for the accrual of $3.0 million of future occupancy costs and $0.3 million of severance obligations and other related costs of closure, net of anticipated tax benefits of $1.3 million. In addition, both the financial statements for the three months ended October 2, 2004 and all prior financial statements have been restated to reflect skin care center operations as discontinued. During the three-month period ended October 2, 2004, the landlord for the Boston facility secured a sublease for that property. The Company was not able to determine the future economic benefit of the sublease at that time. The sublessee commenced making payments to the landlord during December of 2004. As a result of these and future payments scheduled under the sublease, the Company revised the estimated future costs associated with the Boston facility and, in the quarter ended January 1, 2005, has reversed approximately $0.9 million of the restructuring reserve. This reversal represents the aforementioned anticipated economic benefit due to sublessee payments of $1.7 million, net of legal and other fees of approximately $0.3 million and income taxes of approximately $0.5 million, and was recognized in the three-month period ended January 1, 2005.
The Company believes that the size of the remaining accrual is sufficient to cover all future leasehold expenses for the remainder of the lease term. These expenses could potentially increase if the sublessee were not to honor its obligation.
16
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