NOTE 11 – INCOME TAXES

Our effective income tax rates for the three months ended January 30, 2015 and January 24, 2014 are as follows:



	Three Months Ended
	January 30, 2015		January 24, 2014
Effective Tax Rate	26.8	%	32.4	%

The lower first quarter 2015 effective tax rate was primarily due to the sale of specialty product offering in a foreign location (which is taxed at a lower rate than the U.S. federal statutory rate), the retroactive extension of the US Research and Development Tax Credit for calendar year 2014 and changes in the geographic mix of earnings.

The effective tax rate for the three months ended January 30, 2015 is lower than the U.S. federal statutory rate of 35.0% primarily due to earnings in foreign jurisdictions (which are taxed at rates lower than the U.S. federal statutory rate) and also the retroactive extension of the US Research and Development Tax Credit for calendar year 2014.

At October 31, 2014, we had a $18,766 liability recorded for gross unrecognized tax benefits (excluding interest and penalties). Of this total, $18,169 represents the amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. As of October 31, 2014, we had accrued approximately $5,380 of interest and penalties relating to unrecognized tax benefits. There were no material adjustments to our recorded liability for unrecognized tax benefits or interest and penalties during the first quarter of fiscal years 2015 or 2014.