INCOME TAXES (TABLES)

12 Months Ended

Dec. 31, 2016

The sources of pre-tax operating income are as follows (in thousands):


	Year Ended December 31,
	2016		2015		2014
Domestic	$	(6,216)	$	25,402	$	20,569
Foreign		56,514		60,487		79,890
Total	$	50,298	$	85,889	$	100,459

Components of Income Tax Expense (Benefit)

The components of the Company’s Provision for (benefit from) income taxes are as follows (in thousands):


	Year Ended December 31,
	2016		2015		2014
Current provision for (benefit from)
Federal	$	(373)	$	4,094	$	(699)
State		372		1,829		270
Foreign		14,447		4,764		13,957
Total current provision for (benefit from)		14,446		10,687		13,528
Deferred provision for (benefit from)
Federal		(2,390)		(1,895)		10,148
State		103		1,085		423
Foreign		704		10,127		(1,057)
Total deferred provision for (benefit from)		(1,583)		9,317		9,514
Total provision for (benefit from) income taxes	$	12,863	$	20,004	$	23,042

Effective Income Tax Rate Reconciliation Table

The following reconciles the Company’s effective tax rate to the federal statutory rate (in thousands):


	Year Ended December 31,
	2016		2015		2014
Income tax per U.S. federal statutory rate (35%)	$	17,605	$	30,062	$	35,161
State income taxes, net of federal deduction		(158)		1,603		1,525
Change in valuation allowances		(129)		3,923		256
Foreign income taxes at different rates than the U.S.		(10,206)		(14,490)		(17,824)
Foreign withholding taxes		590		958		257
Losses in international markets without tax benefits		2,474		1,999		1,649
Nondeductible compensation under Section 162(m)		104		512		817
Liabilities for uncertain tax positions		(133)		1,756		1,435
Permanent difference related to foreign exchange gains		388		162		(11)
(Income) losses of foreign branch operations		(635)		(517)		225
Non-taxable earnings of noncontrolling interest		(1,128)		(1,349)		(1,141)
Foreign dividend less foreign tax credits		(4,646)		(4,425)		(1,428)
Increase in deferred tax liability - branch losses in UK		—		(2,530)		(75)
Decrease (increase) to deferred tax asset - change in tax rate		443		(526)		(443)
State income tax credits		100		(1,477)		(142)
Foreign earnings taxed currently in U.S.		3,673		2,839		2,696
Taxes related to prior year filings		2,554		344		—
Other		1,967		1,160		85
Income tax per effective tax rate	$	12,863	$	20,004	$	23,042

Schedule of Deferred Tax Assets and Liabilities

The Company’s deferred income tax assets and liabilities are summarized as follows (in thousands):


	Year Ended December 31,
	2016		2015
Deferred tax assets, gross
Accrued workers compensation, deferred compensation and employee benefits	$	11,212	$	10,509
Allowance for doubtful accounts, insurance and other accruals		3,348		4,860
Amortization of deferred rent liabilities		3,362		2,500
Net operating losses		20,253		19,522
Equity compensation		2,489		3,505
Customer acquisition and deferred revenue accruals		11,739		16,610
Federal and state tax credits, net		7,439		10,057
Depreciation and amortization		4,671		6,265
Unrealized losses on derivatives		13,815		16,644
Contract acquisition costs		1,044		—
Other		2,331		2,655
Total deferred tax assets, gross		81,703		93,127
Valuation allowances		(9,949)		(10,139)
Total deferred tax assets, net		71,754		82,988
Deferred tax liabilities
Contract acquisition costs		—		(25,667)
Intangible assets		(17,971)		(6,082)
Other		(357)		(2,490)
Total deferred tax liabilities		(18,328)		(34,239)
Net deferred tax assets	$	53,426	$	48,749

Valuation Allowance Rollforward

Activity in the Company’s valuation allowance accounts consists of the following (in thousands):


	Year Ended December 31,
	2016		2015		2014
Beginning balance	$	10,139	$	10,721	$	10,792
Additions of deferred income tax expense		1,914		4,300		946
Reductions of deferred income tax expense		(2,104)		(4,882)		(1,017)
Ending balance	$	9,949	$	10,139	$	10,721

Expiration of Net Operating Loss Carryforwards

As of December 31, 2016, after consideration of all tax loss and tax credit carry back opportunities, the Company had tax affected tax loss carry forwards worldwide expiring as follows (in thousands):


2017	$	—
2018		115
2019		240
2020		375
After 2020		15,114
No expiration		4,409
Total	$	20,253

Reserve for Uncertain Tax Positions Rollforward

The tabular reconciliation of the reserve for uncertain tax benefits on a gross basis without interest for the three years ended December 31, 2016 is presented below (in thousands):


Balance as of December 31, 2013	$	358
Additions for current year tax positions		1,303
Reductions in prior year tax positions		—
Balance as of December 31, 2014		1,661
Additions for current year tax positions		1,048
Reductions in prior year tax positions		—
Balance as of December 31, 2015		2,709
Additions for current year tax positions		826
Reductions in prior year tax positions		(1,153)
Balance as of December 31, 2016	$	2,382

Jurisdictions Open to Income Tax Examination

The following table presents the major tax jurisdictions and tax years that are open as of December 31, 2016 and subject to examination by the respective tax authorities:


Tax Jurisdiction		Tax Year Ended
United States		2013 to present
Argentina		2011 to present
Australia		2012 to present
Brazil		2011 to present
Canada		2009 to present
Mexico		2011 to present
Philippines		2014 to present
Spain		2012 to present