|12 Months Ended|
Jul. 31, 2014
|Income Tax Disclosure [Abstract]|
|Income Tax Disclosure [Text Block]||
Note 6 - Income taxes
The (provision) benefit for income taxes for fiscal years ended July 31 is as follows:
Deferred tax assets and liabilities arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. The components of deferred tax assets (liabilities) as of July 31 are as follows:
At July 31, 2014, the Company had net deferred tax liabilities of approximately $0.2 million which consists primarily of identifiable intangible assets and cumulative tax deductions in excess of book expenses recognized by foreign subsidiaries.
Net deferred tax liabilities are included in the consolidated balance sheets as of July 31 as follows:
The Company recorded a valuation allowance during the year ended July 31, 2014 and 2013 equal to domestic and certain foreign net deferred tax assets. The Company believes that the valuation allowance is necessary as it is not more likely than not that the deferred tax assets will be realized in the foreseeable future based on positive and negative evidence available at this time. This conclusion was reached because of uncertainties relating to future taxable income, in terms of both its timing and its sufficiency, which would enable the Company to realize the deferred tax assets. The change in the valuation allowance was $1.8 million and $6.4 million for fiscal years 2014 and 2013, respectively.
As of July 31, 2014, the Company had U.S. federal net operating loss carryforwards of approximately $103.2 million. The U.S. federal tax loss carryforwards, if not fully utilized, expire between 2018 and 2034. Utilization is dependent on generating sufficient taxable income prior to expiration of the tax loss carryforwards. In addition, the Company has research and development tax credit carryforwards of approximately $1.0 million which expire between 2025 and 2034. As of July 31, 2014, the Company had foreign loss carryforwards of approximately $6.0 million.
The components of loss before income taxes consisted of the following for the years ended July 31:
The benefit (provision) for income taxes were at rates different from U.S. federal statutory rates for the following reasons for the years ended July 31:
U.S. federal income taxes have not been provided on approximately $304 of undistributed earnings at the Company’s foreign subsidiaries at July 31, 2014, because it is the Company’s intent to keep the earnings reinvested. As of July 31, 2014, the Company has 0 liabilities for uncertain tax positions. It is the Company’s policy to record interest and penalties as a component of tax expense. The Company files income tax returns in the U.S. Federal jurisdiction, various U.S. state jurisdictions and several foreign jurisdictions. With few exceptions, the years that remain subject to examination are years July 31, 2011 through 2013.
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