Note 12 - Income Taxes

9 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Income Tax Disclosure [Text Block]

1

2

.  Income Taxes

The provision for income taxes is based upon loss before income taxes as follows (in thousands):

	Nine Months Ended December 31, 2018
Domestic pre-tax loss	$	(10,308	)
Foreign pre-tax loss		(224	)
Total pre-tax loss	$	(10,532	)

The components of the provision for income taxes are as follows (in thousands):

	Nine Months Ended December 31, 2018
US	$	2
Foreign		(121	)
Total provision for income taxes	$	(119	)

The Company accounts for its income taxes in accordance with ASC

740,

Income Taxes. ASC

740

clarifies the accounting for uncertainty in income taxes and prescribes a recognition threshold, measurement attribute for the financial statement recognition and measurement of a tax position taken, or expected to be taken, in a tax return. Under ASC

740,

the Company is required to recognize in the financial statements the impact of a tax position, if that position is more likely than

not

of being sustained on audit, based on the technical merits of the position. ASC

740

also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure. The Company policy is to record interest and penalties related to unrecognized tax benefits in income tax expense. 

At

December 31, 2018,

there was

no

material increase in the liability for unrecognized tax benefits nor any accrued interest and penalties related to uncertain tax positions.

In addition, at

December 31, 2018,

the Company had approximately

$1.5

million of unrecognized tax benefits which were netted against deferred tax assets with a full valuation allowance. If these amounts are recognized, there will be

no

effect on the Company’s effective tax rate due to the full valuation allowance. ASC

740

provides for the recognition of deferred tax assets if realization of such assets is more likely than

not.

  Based on the weight of available evidence, which includes the Company's historical operation performance and the reported cumulative net losses in all prior years, the Company has provided a full valuation allowance against its U.S. federal and state net deferred tax assets

The Company’s Federal, state and foreign tax returns

may

be subject to examination by the tax authorities for fiscal years ended from

1998

to

2018

due to net operating losses and tax carryforwards unutilized from such years.  

The Tax Cuts and Jobs Act of

2017

was enacted in

December 2017,

which introduced the Global Low Taxed Intangible Income (“GILTI”) inclusion. Due to the losses in the foreign subsidiaries, the Company projects

no

GILTI income inclusion for its fiscal year ended

March 31, 2019.

The Company continues to evaluate its accounting policy with respect to temporary differences related to the GILTI inclusion.