INCOME TAXES (Tables)

12 Months Ended

Jan. 31, 2015

Income tax expense (benefit) is summarized as follows:

	Years Ended January 31,
	2015			2014		2013
	(in thousands)
Current:
Federal	$	174		$	303	$	684
State		109			33		25
Foreign		3,010			2,703		2,569
Subtotal		3, 293			3,039		3,278
Deferred:
Federal		(786	)		20		942
State		229			306		220
Foreign		(348	)		297		(929	)
Subtotal		(905	)		623		233
Equity adjustment		251			104		140
Total	$	2,639		$	3,766	$	3,651

Reconciliation of income taxes to the statutory rate

Actual income tax expense (benefit) differs from that obtained by applying the statutory federal income tax rate of 34% to income before income taxes as follows:

	Years Ended January 31,
	2015			2014			2013
	(in thousands)
Computed expected tax expense	$	5,299		$	3,452		$	3,499
State income taxes, net of federal income tax expense		253			330			208
Incremental tax benefit from foreign operations		(5,220	)		(2,676	)		(1,355	)
Non-deductible equity compensation		258			1,176			913
Foreign withholding taxes		1,256			1,171			928
Net change in valuation allowance		1,657			(108	)		(826	)
Net change in contingency reserve		(594	)		45			(68	)
Non-deductible expenses		742			1,084			296
Benefit of tax credits		(1,345	)		(1,624	)		(446	)
Subpart F Income		283			198			313
Rate change impact		54			(88	)		164
Other		(4	)		806			25
Total	$	2,639		$	3,766		$	3,651

Components of deferred tax assets and liabilities

Significant components of the Company’s deferred tax assets and liabilities are as follows:

	January 31,
	2015			2014
	(in thousands)
Deferred tax assets:
Allowance for doubtful accounts and sales adjustments	$	452		$	492
Accrued vacation		2,015			1,923
Tax credits		8,584			7,911
Deferred revenue		3,666			3,467
Net operating loss carry forwards		9,646			10,608
Accrued expenses - other		2,478			2,076
Section 263(a) interest capitalization		353			368
Equity compensation		3,673			4,306
Other		1,824			1,423
Total deferred tax assets		32,691			32,574
Less valuation allowance		(10,684	)		(10,293	)
Less netting of unrecognized tax benefits against deferred tax assets		(1,406	)		—
Deferred tax assets, net of valuation allowance	$	20,601		$	22,281
Deferred tax liabilities:
Unrecognized capital gain		(863	)		(1,033	)
Depreciation and amortization		(379	)		(654	)
Other comprehensive income		(20	)		(295	)
Other		(346	)		(378	)
Total deferred tax liabilities		(1,608	)		(2,360	)
Total net deferred tax assets	$	18,993		$	19,921
Recorded as:
Current portion of deferred tax assets		9,434			8,242
Non-current portion of deferred tax assets		11,229			13,110
Current portion of deferred tax liabilities (in current deferred tax assets)		(121	)		(109	)
Non-current portion of deferred tax liabilities (in non-current deferred tax assets)		(1,549	)		(1,322	)
Total net deferred tax assets	$	18,993		$	19,921

Gross amounts of unrecognized tax benefits

The following table reconciles the gross amounts of unrecognized tax benefits at the beginning and end of the period:

	Years Ended January 31,
	2015			2014
	(in thousands)
Unrecognized tax benefits at beginning of the year	$	2,626		$	2,581
Increases as a result of tax positions taken in a prior period		85			45
Increases as a result of tax positions taken in the current period		27			—
Reduction as a result of a lapse of the statute of limitations		(649	)		—
Decreases as a result of tax settlements		(165	)		—
Unrecognized tax benefit at end of year	$	1,924		$	2,626

List of open tax year by jurisdiction

Below is a list of our material jurisdictions and the years open for audit as of fiscal 2015:

Jurisdiction	Years Open for Audit
U.S. Federal	FY12 and beyond
California	FY11 and beyond
Michigan	FY11 and beyond
New Jersey	FY11 and beyond
Australia	FY11 and beyond
France	FY12 and beyond
India	FY99 and beyond
Ireland	FY11 and beyond
United Kingdom	FY12 and beyond