10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the year ended April 30, 2017
	or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                        to

Commission File Number: 001-35588

Liberty Tax, Inc.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)	27-3561876 (I.R.S. Employer Identification No.)
1716 Corporate Landing Parkway, Virginia Beach, Virginia (Address of principal executive offices)	23454 (Zip Code)

Registrant's telephone number, including area code: (757) 493-8855

Securities registered pursuant to Section 12(b) of the Act:

Class A Common Stock, par value $0.01 per share (Title of Class) The NASDAQ Stock Market LLC (Name of Exchange on which registered)

Securities to be registered pursuant to Section 12(g) of the Act:

None

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES o    NO ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15 (d) of the Act. YES o    NO ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ý    NO o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES ý    NO o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer ý Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company o

 Emerging growth company ý

 If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES o    NO ý

The aggregate market value of the shares of Class A common stock held by non-affiliates of the registrant computed based on the last reported sale price of $11.85 on October 31, 2016 was $102,079,574.

The number of shares of the registrant's Class A common stock outstanding as of July 3, 2017 was 12,682,550.

The number of shares of the registrant's Class B common stock outstanding as of July 3, 2017 was 200,000.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Definitive Proxy Statement for the 2017 Annual Meeting of Stockholders are incorporated by reference into Part III hereof.

Table of Contents

Part I
Item 1.	Business	6
Item 1A.	Risk Factors	12
Item 1B.	Unresolved Staff Comments	28
Item 2.	Properties	28
Item 3.	Legal Proceedings	28
Item 4.	Mine Safety Disclosures	28
Part II
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	29
Item 6.	Selected Financial Data	32
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	35
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	46
Item 8.	Financial Statements and Supplementary Data	47
	Report of Independent Registered Public Accounting Firm	F-1
	Consolidated Balance Sheets	F-2
	Consolidated Statements of Income	F-3
	Consolidated Statements of Comprehensive Income	F-4
	Consolidated Statements of Stockholders' Equity	F-5
	Consolidated Statements of Cash Flows	F-8
	Notes to Consolidated Financial Statements	F-10
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	47
Item 9A.	Controls and Procedures	47
Item 9B.	Other Information	47
Part III
Item 10.	Directors, Executive Officers, and Corporate Governance	49
Item 11.	Executive Compensation	49
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	49
Item 13.	Certain Relationships and Related Transactions and Director Independence	49
Item 14.	Principal Accounting Fees and Services	49
Part IV
Item 15.	Exhibits and Financial Statement Schedules	50
Item 16.	Form 10-K Summary	53
Signatures		53

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This annual report contains forward-looking statements concerning our business, operations, and financial performance and condition as well as our plans, objectives, and expectations for our business operations and financial performance and condition. Any statements contained herein that are not of historical facts may be deemed to be forward-looking statements. You can identify these statements by words such as "aim," "anticipate," "assume," "believe," "could," "due," "estimate," "expect," "goal," "intend," "may," "objective," "plan," "predict," "potential," "positioned," "should," "target," "will," "would," and other similar expressions that are predictions of or indicate future events and future trends. These forward-looking statements are based on current expectations, estimates, forecasts, and projections about our business and the industry in which we operate and our management's beliefs and assumptions. They are not guarantees of future performance or development and involve known and unknown risks, uncertainties, and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this annual report may turn out to be inaccurate. Factors that may cause such differences include, but are not limited to, the risks described under "Item 1A—Risk Factors," including:

• our inability to grow on a sustainable basis;

• the seasonality of our business;

• the continued service of our senior management team and our ability to attract additional talent;

• our inability to secure reliable sources of the tax settlement products we make available to our customers;

• government regulation and oversight, including the regulation of tax preparers or settlement products such as refund transfers and loan settlement products;

• government initiatives that simplify tax return preparation, improve the timing and efficiency of processing tax returns, limit payments to tax preparers, or decrease the number of tax returns filed or the size of the refunds;

• government initiatives to pre-populate income tax returns;

• the effect of regulation of the products and services that we offer, including changes in laws and regulations;

• the possible characterization of refund transfers as a form of loan or extension of credit;

• changes in the tax settlement products offered to our customers that make our services less attractive to customers or more costly to us;

• our ability to maintain relationships with our tax settlement product service providers;

• any potential non-compliance, fraud or other misconduct by our franchisees or employees;

• our ability and the ability of our franchisees to comply with legal and regulatory requirements;

• failures by our franchisees and their employees to comply with their contractual obligations to us and with laws and regulations, to the extent these failures affect our reputation or subject us to legal risk;

• the ability of our franchisees to open new territories and operate them successfully;

• the ability of our franchisees to generate sufficient revenue to repay their indebtedness to us;

• our ability to manage Company-owned offices;

• our exposure to litigation;

• our ability and our franchisees' ability to protect customers' personal information, including from a cyber-security incident;

• the impact of identity-theft concerns on customer attitudes toward our services;

• our ability to access the credit markets and satisfy our covenants to lenders;

• challenges in deploying accurate tax software in a timely way each tax season;

• delays in the commencement of the tax season attributable to Congressional action affecting tax matters and the resulting inability of federal and state tax agencies to accept tax returns on a timely basis, or other changes that have the effect of delaying the tax refund cycle;

• competition in the tax preparation market;

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• the effect of federal and state legislation that affects the demand for paid tax preparation, such as the Affordable Care Act and potential immigration reform;

• our reliance on technology systems and electronic communications;

• our ability to effectively deploy software in a timely manner and with all the features our customers require;

• the impact of any acquisitions or dispositions, including our ability to integrate acquisitions and capitalize on their anticipated synergies; and

• other factors, including the risk factors discussed in this annual report.

Potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on the forward-looking statements. These forward-looking statements speak only as of the date of this annual report. Unless required by law, we do not intend to publicly update or revise any forward-looking statements to reflect new information or future events or otherwise. A potential investor or other vendor should, however, review the factors and risks we describe in the reports we will file from time to time with the U.S. Securities and Exchange Commission ("SEC") after the date of this annual report.

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PART I

Item 1.    Business.

Company Information

We were incorporated in Delaware in September 2010 as JTH Holding, Inc. In July 2014, our corporate name was changed to Liberty Tax, Inc. in order to better reflect our primary business and to eliminate confusion among stockholders and potential investors seeking information about us. We are the holding company for JTH Tax, Inc. d/b/a Liberty Tax Service, our largest subsidiary, which was incorporated in Delaware in October 1996. As an "emerging growth company" under applicable federal securities laws, we are subject to reduced public company reporting requirements.

References in this report to "years" are to our fiscal years, which end on April 30 unless otherwise noted, and all references to "tax season" refer to the period between January 1 and April 30 of the referenced year. Unless the context requires otherwise, the terms "Liberty Tax," "Liberty Tax Service," "we," "the Company," "us," and "our" refer to Liberty Tax, Inc. and its consolidated subsidiaries. A complete list of our subsidiaries can be found in Exhibit 21.1 to this report.

Financial Information about Segments

The majority of our revenue is earned through our United States operations; however, during our fiscal years 2017, 2016, and 2015, we earned $7.0 million, $7.0 million, and $6.9 million, respectively, from our Canadian operations. Due to the similarity in the nature of products and services, production process, type of customer, distribution methods, future prospects, and regulatory environment, we combine our United States operations and our Canadian operations into one reportable segment.

Our Business

We are one of the leading providers of tax preparation services in the United States and Canada. Although we operate a limited number of Company-owned offices each tax season, our tax preparation services and related tax settlement products are offered primarily through franchised locations. The majority of our offices are operated under the Liberty Tax Service or SiempreTax+ brands. We also provide an online digital Do-It-Yourself ("DIY") tax program in the United States.

Our business involves providing retail federal and state income tax preparation services and related tax settlement products in the United States and Canada. Our focus is on growing the number of Liberty Tax and SiempreTax+ offices, increasing the number of tax returns prepared by those offices, and enhancing profitability by offering services and products that continue to build both brands.

The tax return preparation market is divided into two primary distinct sectors: paid tax preparation and DIY preparation. Approximately 58% of U.S. e-filed returns during the 2017 tax season were prepared by paid preparers. Through our franchise and Company-owned offices, we offer tax preparation services and related financial products to our tax customers. The services and products are designed to provide streamlined tax preparation services for taxpayers who, for reasons of complexity, convenience, or the need for prompt tax refunds, seek assisted tax preparation services. In the 2017 tax season, we and our franchisees accounted for 1.7 million tax returns filed through our U.S. retail offices, 0.4 million through our Canadian retail offices, and 0.1 million through our online tax programs.

We expect to benefit from anticipated industry consolidation as we believe many independent tax preparers will look to exit the industry as they confront increased costs, regulatory requirements and demands to provide tax settlement products. We believe we will be a beneficiary of this consolidation because we are able to more efficiently address changing regulatory requirements due to our scale and also because we have succeeded in providing a fully competitive mix of financial products we believe to be attractive to our customers.

We believe the growing Hispanic population in the United States presents an opportunity for growth for tax preparers who are able to successfully target those potential customers with tax and related services that serve the unique needs of the Hispanic community. For that reason, during fiscal 2015 we launched a new franchised tax brand, SiempreTax+, which operated 159 offices during the 2017 tax season. We expect this brand to continue to grow, and we are working with our franchisees to develop additional non-tax service offerings in these offices that will attract customers to the brand. Moreover, we anticipate that any immigration reform, whether enacted through executive action or by Congress, will continue to increase the number of Hispanic filers.

Our Franchise Model

We rely on a franchise model for our growth. Although our competitors rely on a mix of franchise locations and Company-owned offices or operate a majority of Company-owned offices, we have historically operated relatively few

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Company-owned stores and have determined that we can best grow our Company by increasing our franchisee base, and the number of offices operated by franchisees. Under our franchise model, we are able to focus on marketing, franchisee coaching and support, financial product development and other initiatives that drive our overall success. In addition, our franchise model allows us to grow our tax system with minimal capital expenditures or fixed cost investments.

We have included in our franchisee model the sale of area developer ("AD") areas. Under the AD model, we make large clusters of territories available to an AD who is responsible for marketing the available franchise territories within the larger AD area in order to help us fill gaps in our franchise system. As described below, when we utilize an AD to assist us in franchise sales, we receive revenue from the sale of the AD area but sacrifice a portion of the franchise fees and the royalty stream from the franchises within the AD area.

Franchise territories. We have divided the United States into approximately 10,000 potential franchise territories. We attempt to draw territory boundaries such that each territory has a target population of approximately 30,000 people. Franchisees are permitted to open more than one office in a territory.

Upon the launch of our new SiempreTax+ brand, we made clear to franchisees who owned existing territories that they could have rights to operate both brands within those territories, and that they would be permitted to open offices of both brands, in their existing territories, if they determined that the territory would support both a Liberty Tax office and a SiempreTax+ office. Our franchisees may also be permitted to sell rights to one brand in their territory while retaining rights to the other brand. During fiscal 2015, we also began to sell the rights to our two brands separately in undeveloped territories while we retained the territory boundaries that existed before the launch of our second brand.

Franchise sales process. We engage in an active marketing process, both directly and through our ADs, in order to sell additional franchise territories. Our sales process includes sales to new franchisees, as well as the sale of additional territories to existing franchisees willing to expand into additional territories. For new franchisees, the process includes multiple steps that culminate in a week-long training session that we call Effective Operations Training. In addition, from time to time, we offer special franchise purchase programs, which are designed to allow existing franchisees to acquire additional territories or to encourage independent tax preparers to become franchisees.

Our franchise agreements. Under the terms of our standard franchise agreement, each franchisee receives the right to operate a tax return preparation business under the Liberty Tax Service brand and/or SiempreTax+ brand within a designated geographic area. Similarly, our agreements with ADs permit ADs to market franchise territories within a designated multi-territory area. Franchise agreements have an initial term of five years and are renewable. The agreements impose various performance requirements on franchisees, require franchisees to use our proprietary software and equipment designated by us, and obligate our franchisees to operate in their offices in accordance with standards we establish. These standards include specified in-season and out-of-season opening hours, criteria for the location of franchise offices, requirements related to tax preparers and other office employees, and minimum performance standards. Our agreements also require our franchisees to comply with applicable state and federal legal requirements. Although we do not control and are not responsible for any compliance issues that could be caused by our franchisees or their tax preparers, we provide guidance to our franchisees regarding their compliance obligations, including the provision of standard advertising templates, training materials that include detailed compliance information, and systems that alert them to unusual activity. We also use a variety of means in an attempt to identify potential franchise and tax law compliance issues and require franchisees to address any concerns, including the continued enhancement of a Compliance Department which helps to examine and prevent non-compliance, fraud and other misconduct among our franchisees and employees.

Each year, we terminate a number of franchisees and other franchisees voluntarily relinquish their territories, sometimes in exchange for our forbearance on the remaining indebtedness owed to us in connection with the franchise territory. In order to protect our competitive position, we regularly take actions to enforce the non-competition obligations and restrictions regarding customer lists and our trademarks and service marks contained in our franchise agreements.

AD areas. We initiated our AD program in 2001 in order to accelerate the growth of our franchise system. We continue utilizing the AD program to focus on areas with large underdeveloped groups of territories we believe would benefit from the dedicated sales attention that an AD offers. Our fees for AD areas vary based on our assessment of the revenue potential of each AD area, and also depend on the performance of any existing franchisees within the AD area being sold. Our ADs generally receive 50% of both the franchise fee and royalties collected from franchises located in their AD areas and are required to provide marketing and operational support.

Company-owned offices. We intentially operate relatively few Company-owned offices. During the 2017 tax season we operated 362 Company-owned offices in the U.S. and Canada, 41 of which were seasonal offices. We focus primarily on growing through the opening of new franchise locations, and most of the Company-owned offices we operate in a given tax season are offices that have been previously owned by former franchisees who have ceased operations or failed to meet our

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performance standards. Rather than close offices that we believe have the potential to be successful, we attempt to resell these offices, and when we fail to do so before the beginning of a tax season, we may operate them as Company-owned offices until we can resell them at a later time. In future periods, the number of Company-owned offices may increase if the Company reacquires more offices from existing franchisees and does not find suitable buyers to take over the office prior to the start of the tax season. For this reason, the number of offices we operate as Company-owned offices may change substantially from season to season.

Franchise fees and royalties. Franchisees presently have several options for acquiring a new undeveloped territory. The typical franchise fee for a Liberty Tax franchise is $40,000 and the fee starts at $25,000 for the SiempreTax+ franchise. We often offer special financing programs. Our franchise agreement requires franchisees to pay us a base royalty equal to 14% of the franchisee's tax preparation revenue, subject to certain specified minimums. Franchisees are also required to pay us an advertising fee of 5% of their tax preparation revenue.

Franchisee loans. We provide a substantial amount of lending to our franchisees and ADs. In addition to allowing franchisees to finance a portion of their franchise fees, which they pay over time, we also offer our franchisees working capital loans to fund their operations.

This indebtedness generally takes one of the following forms:

• The unpaid portion of franchise and AD fees, which does not represent a cash advance by us to the franchisee or AD, but a financing of the franchise or AD fee, generally payable over four years for territory franchise fees and six years for AD fees.

• Amounts due to us in connection with the purchase of a Company-owned office. The notes for these amounts are generally payable over five years following the acquisition.

• Annual working capital loans made available to qualified franchisees between May 1 and January 31 each year, which are repayable to us generally by the end of February.

Fee intercept. We have the ability to collect these amounts from our franchisees through a "fee intercept" mechanism. Our franchise agreement allows us to obtain repayment of amounts due to us from our franchisees through an electronic fee intercept program before our franchisees receive the net proceeds from tax preparation and other fees they have charged to their customers who have received a tax settlement product. Therefore, we are able to reduce the nonpayment risk associated with amounts outstanding from franchisees by obtaining direct electronic payment in the ordinary course throughout the tax season. Our credit risk associated with amounts outstanding from ADs is also mitigated by our electronic fee intercept program, which enables us to obtain repayments of amounts that would otherwise flow through to ADs as their share of franchise fee and royalty payments, to the extent of an AD's indebtedness to us.

Tax software. Our current proprietary tax software programs offer an interactive question-and-answer format that is easy for our retail office tax preparers to use, facilitating tax preparer training. A substantial number of changes are made each year to federal and state tax laws, regulations, and forms that require us to expend substantial resources every year to develop and maintain tax preparation software. We also offer an online digital DIY tax software in the United States.

Franchisee support. We provide substantial support to our franchisees in a variety of ways. Our franchise agreement requires our franchisees to adhere to certain minimum standards, including the use of tax preparation software we provide, the use of computers and other equipment that we select (but that we do not sell to them), training requirements, and other criteria. We make substantial training opportunities available to our franchisees and their prospective employees, and we require each franchisee to send representatives to a week-long Effective Operations Training seminar before they are allowed to operate a franchise location. We also make intermediate and advanced training available to our franchisees, offer "Tax School" classes for franchisees and prospective tax preparers, and provide substantial phone and internet-based support, particularly during the tax season. During the tax season, we maintain a fully-staffed operations center, with extended hours, at our corporate headquarters in Virginia Beach, Virginia. During the peak tax season, we hold daily conference calls in which we share and allow other franchisees to share recommendations and techniques for improving office performance, and in which we emphasize the importance of implementing the marketing plan that we recommend as part of our franchisee training.

Our Financial Products

We expend considerable effort to ensure that our franchisees are able to offer a complete range of tax settlement products to our customers, and to provide our customers choices in these products. We offer these products because we believe that a substantial portion of our prospective customer base places significant value on the ability to monetize their expected income tax refund more quickly than they would be able to do if they were to file their tax return without utilizing the services of a paid tax preparer. We offer two types of tax settlement products: refund transfer products and refund-based loans.

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Refund transfer products. Many of our tax customers seek products that will enable them to obtain access to their tax refunds more quickly than they might otherwise be able to receive those funds. We believe that many of our customers are unbanked, in that they do not have access to a traditional banking account, and therefore, cannot make such an account available to the IRS and other tax authorities for the direct deposit of their tax refunds. Additionally, customers may have access to a traditional banking account, but for personal reasons, may prefer not to utilize that account for the deposit of their tax refunds.

A refund transfer product involves direct deposit of the customer's tax refund into a newly established temporary bank account in the customer's name that we establish with one of our banking partners that have contracted with one of our subsidiaries, JTH Financial, LLC ("JTH Financial"). The balance of the customer’s refund, after payment of tax preparation and other fees will be delivered to the customer by paper check, prepaid card or a direct deposit into a customer’s existing bank account. When the prepaid card option is elected, the card is issued through one of our financial product partners and is branded with the Liberty Tax logo. When we deliver a physical refund check to a customer, we are generally able to print the check in one of our retail tax offices on check stock paper within a matter of hours after the electronic deposit of the customer's refund has been made to the customer's temporary account. We also enter into check-cashing arrangements with a number of retail establishments, which facilitate the ability of our customers to monetize their check even when they do not have traditional banking relationships.

We believe the continued availability of refund transfers will enable us to continue to offer an adequate mix of tax settlement products to our customers. The number of customers in our U.S. offices receiving our refund transfer products, which we call our "attachment rate," has varied from 47.6% for the 2017 tax season compared to 49.2% for the 2016 tax season and 49.7% for the 2015 tax season.

Refund-based loans. During the past two seasons, we partnered with banks to make available a refund-based loan to customers ("Refund Advance"). Approved customers were charged no fees or interest on the Refund Advance. There were no additional requirements for the customer to pay for any additional products, such as a refund transfer, to receive a Refund Advance.

Online Tax Preparation

Although online tax preparation, through our digital online tax services, represents a small portion of tax returns prepared and associated revenue, we believe there is a market for customers who wish to prepare their own tax returns using moderately priced online tax preparation products, and the continued availability of these products may be a part of our long-term growth, particularly if we are able to successfully integrate our online and retail tax services.

Intellectual Property

We regard our intellectual property as critical to our success and we rely on trademark, copyright, and trade secret laws in the United States to protect our proprietary rights. We pursue the protection of our service mark and trademarks by applying to register key trademarks in the United States. The initial duration of federal trademark registrations is 10 years. Most registrations can be renewed perpetually at 10-year intervals. In addition, we seek to protect our proprietary rights through the use of confidentiality agreements with employees, consultants, vendors, advisors, and others. The primary marks we believe to be of material importance to our business include our Lady Liberty logo and the brands "Liberty Tax," "Liberty Tax Service," "Liberty Income Tax," "Liberty Canada," and "SiempreTax+."

Seasonality

The tax return preparation business is highly seasonal, and we historically generate most of our revenues during the period from January 1 through April 30. For example, in fiscal 2017 and 2016, we earned 28% and 31% of our revenues during our fiscal third quarter ended January 31, respectively, and 92% and 91% of our revenues during the combined fiscal third and fourth quarters of 2017 and 2016, respectively. We generally operate at a loss during the period from May 1 through December 31, during which we incur costs associated with preparing for the upcoming tax season.

Available Financing

We use our available financing to fund operations between tax seasons and have minimal outstanding indebtedness at the end of each fiscal year. At April 30, 2017 and 2016, for example, we had no outstanding balance under our revolving credit facility. Our term loan had outstanding balances of $17.5 million and $18.9 million at April 30, 2017 and 2016, respectively.

Competition

The paid tax preparation market is highly competitive. We compete with tens of thousands of paid tax return preparers, including H&R Block, Jackson Hewitt, regional and local tax return preparation companies, most of which are independent and

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some of which are franchised, regional and national accounting firms, and financial service institutions that prepare tax returns as part of their businesses.

We also face increased competitive challenges from the online and software self preparer market, including the Free File Alliance ("FFA"), a consortium of the IRS and online preparation services that provides free online tax return preparation, and from volunteer and certain state organizations that prepare tax returns at no cost for low-income and other qualified taxpayers. Our ability to compete in the tax return preparation business depends on our product mix, price for services, customer service, the specific site locations of our offices, local economic conditions, quality of on-site office management, the ability to file tax returns electronically with the IRS, and the availability of tax settlement products to offer to our customers.

We also compete for the sale of tax return preparation franchises with H&R Block, Jackson Hewitt, and other regional franchisors. In addition, we compete with franchisors of other high-margin services outside of the tax preparation industry that attract entrepreneurs seeking to become franchisees. Our ability to continue to sell franchises is dependent on our brand image, the products and services to be provided through the network, the relative costs of financing and start-up costs, our reputation for quality, and our marketing and advertising support. However, we believe that there is no existing smaller competitor in the retail tax preparation market that could challenge our market position on a national scale due to the expense and length of time required to develop the infrastructure, systems and software necessary to create and support a nationwide network of tax preparation offices. As a result, we believe that it would be difficult for an additional national competitor to emerge in our market for the foreseeable future.

Our online tax business also competes with a number of companies. Intuit, Inc., the maker of Turbo Tax, is the largest supplier of tax preparation software for online tax preparation services. H&R Block and Blucora, Inc., the owner of TaxAct, also have substantial online and software-based products.

Although we acquired the customer lists of two other online tax providers before the 2013 and 2014 tax seasons, the substantial advertising resources of our largest online tax competitors places us at a substantial disadvantage in this very competitive segment of the tax preparation market. During fiscal 2015, we recognized a portion of the purchase prices of those previously acquired customer lists as impaired, and we do not have any present plans for further growth of our online business through acquisition, unless a compelling strategic opportunity presents itself. We did not record an impairment related to the online tax preparation business in either fiscal 2016 or 2017.

Regulation

We and our franchisees must comply with laws and regulations relating to our businesses. Regulations and related regulatory matters specific to our businesses are described below.

Federal tax return preparation regulation. Federal law requires tax preparers to, among other things, set forth their signatures and identification numbers on all tax returns prepared by them and retain for three years all tax returns prepared. Federal laws also subject tax preparers to accuracy-related penalties in connection with the preparation of tax returns. Preparers may be enjoined from further acting as tax preparers if they continually or repeatedly engage in specified misconduct. Additionally, all authorized IRS e-file providers must adhere to IRS e-file rules and requirements to continue participation in IRS e-file. Adherence to all rules and regulations is expected of all providers regardless of where published and includes, but is not limited to, those described in IRS Publication 1345, Handbook for Authorized IRS e-file Providers. Various IRS regulations also require tax return preparers to comply with certain due diligence requirements to investigate factual matters in connection with the preparation of tax returns. The IRS conducts audit examinations of authorized IRS e-file providers and tax return preparers, reviewing samples of prepared tax returns to ensure compliance with regulations in connection with tax return preparation activities. From time to time, certain of our franchisees and Company-owned offices are the subject of IRS audits to review their tax return preparation activities.

We engage in significant efforts to enhance tax compliance by our franchisees and their preparers, including the use of a franchisee alert system that identifies anomalous patterns, compliance audits of selected offices and returns, additional training requirements and actions taken against problematic preparers (including blacklisting to prevent their hiring by other franchisees and reporting to the IRS).

The IRS published final regulations in 2010 that would have imposed mandatory tax return preparer regulations, but federal courts have ruled that the IRS did not have authority to implement those regulations. The IRS has created a voluntary tax preparer certification regime.

During fiscal 2016, the United States Department of Justice (“DOJ”) announced two law suits against certain of our former larger franchisees and two lawsuits against then-existing franchisees. Allegations involved claims of fraudulent tax preparation. We were not named as a defendant in these suits, which concluded in fiscal 2017. Further, in fiscal 2017, the state of Maryland, Office of the Comptroller suspended the processing of electronic and paper returns of one franchisee who owned

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two offices in that state. We retained outside counsel to conduct internal reviews (the “Internal Review”) of our compliance practices, policies and procedures in connection with tax return preparation activities. The Internal Review’s examination made certain recommendations, many of which have been implemented including enhanced monitoring tools and increased training of franchisees and their preparers. We have continued to actively cooperate with the applicable government authorities in connection with their investigations and to enhance our Compliance Department to examine and prevent non-compliance, fraud and other misconduct among our franchisees and their employees.

State tax return preparation regulation. We are also subject to tax return preparation regulation at the state level. The scope and substance of these regulations vary from state to state, but states also conduct examinations and take enforcement action against tax return preparers. From time to time, certain of our franchisees and Company-owned offices are the subject of state-level audits to review their tax preparation activities. In addition, particularly in the absence of effective IRS regulations imposing mandatory tax return preparer requirements, several states have begun to fill this void by imposing state-level preparer regulatory requirements. We believe our in-house certification program exceeds these regulatory requirements.

Financial privacy regulation. The Gramm-Leach-Bliley Act and related FTC regulations require income tax return preparers to adopt and disclose customer privacy policies and provide customers a reasonable opportunity to opt-out of having personal information disclosed to unaffiliated third parties for marketing purposes. Some states have adopted or proposed stricter opt-in requirements in connection with use or disclosure of consumer information. Federal and state law also requires us and our franchisees to safeguard the privacy and security of our customers' data, including financial information, to prevent the compromise or breach of our security that would result in the unauthorized release of customer data. Breaches of information security that affect us or our franchisees require compliance with customer notification requirements imposed at the state and local level, and in addition, may subject us to regulatory review by the FTC and other federal and state agencies. For example, in connection with a burglary that occurred at a single franchise office, both we and the affected franchisee have been required to respond to a document request issued by the FTC. Additional restrictions on disclosure are imposed by the IRS, which prohibits the use or disclosure by tax preparers of income tax return information without the prior written consent of the taxpayer. The IRS may continue to consider further regulations concerning disclosures or uses of tax return information.

Financial product regulation. Federal and state statutes and regulations govern the facilitation of refund-based loans and other tax settlement financial products. These laws require us, among other things, to provide specific loan disclosures and advertise loans in a certain manner. In addition, we are subject to federal and state laws that prohibit deceptive claims and require that our marketing practices are fair and not misleading. Federal law also limits the annual percentage rate on loans for active duty service members and their dependents. There are also many states that have statutes regulating, through licensing and other requirements, the activities of brokering loans and offering credit repair services to consumers, as well as local usury laws which could be applicable to our business in certain circumstances. From time to time, we receive inquiries from various state regulators regarding our and our franchisees' facilitation of refund-based loans and other tax settlement products. We have in certain states paid fines, penalties, and other payments as well as agreed to injunctive relief, in connection with resolving these types of inquiries.

Potential regulation of refund transfer products or treatment of refund transfer products as loans or extensions of credit. Our refund transfer products may be subject to additional regulation because of potential regulatory changes as well as litigation asserting that refund transfer products constitute a loan or extension of credit because many customers who receive refund transfer products elect to defer paying their tax preparation fees until their tax refund is received. With respect to possible new regulation, the broad authority of the Consumer Financial Protection Bureau ("CFPB") may enable that agency to pursue initiatives that negatively impact our ability to offer tax settlement products by imposing disclosure requirements or other limitations that make the products more difficult to offer or reduce their acceptance by potential customers. See "Item 1A—Risk Factors—Risk Related to Regulation of Our Industry—Legislative and regulatory reforms may have a significant impact on our business, results of operations and financial condition" and "—Federal and state regulators may impose new regulations on non-loan tax settlement products that would make those products more expensive for us to offer or more difficult for our customers to obtain."

We have previously been subject to class action litigation asserting that the refund transfer product is a loan or extension of credit, and should therefore be subject to loan-related federal and state disclosure requirements, which litigation was settled in January 2016. We are also subject to an injunction in California that treats our refund transfer product as an extension of credit. If we are subject to an adverse decision in future litigation that affects our offering of refund transfer products in other states, our refund transfer products would be subject to additional regulatory requirements in those states, including federal truth-in-lending disclosure obligations, and possible compliance with statutes and regulations governing refund anticipation loans that have been adopted in numerous states. This additional regulation would not prohibit us from offering refund transfer products but might require us to make interest rate and other disclosures to customers because of the characterization of the refund transfer product as a loan or extension of credit that would make it more difficult to market the refund transfer product to potential customers or reduce their acceptance by potential customers, and might adversely affect fees charged related to refund

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transfer products because of limitations on fees imposed by state refund anticipation loans statutes and regulations. See "Item 1A—Risk Factors—Risks Related to Regulation of Our Industry—Federal and state regulators may impose new regulations on non-loan tax settlement products that would make those products more expensive for us to offer or more difficult for our customers to obtain" and "—We may be unsuccessful in litigation that characterizes refund transfer products as loans, which could subject us to damages and additional regulation, and which could adversely affect our ability to offer tax settlement products and have a material adverse effect on our operations and financial results."

Franchise regulations. Our franchising activities are subject to the rules and regulations of the FTC and various state agencies regulating the offer and sale of franchises. These laws require that we furnish to prospective franchisees a franchise disclosure document describing the requirements for purchasing and operating a Liberty Tax or a SiempreTax+ franchise. In a number of states in which we are currently franchising, we are required to be registered to sell franchises. Several states also regulate the franchisor/franchisee relationship particularly with respect to the duration and scope of non-competition provisions, the ability of a franchisor to terminate or refuse to renew a franchise, and the ability of a franchisor to designate sources of supply. Bills have been introduced in Congress from time to time that would provide for federal regulation of the franchisor/franchisee relationship in certain respects.

Telephone Consumer Protection Act. Maintaining contact with customers is an essential component of the efforts by our franchisees, and by us in Company-owned offices, to retain tax customers from year-to-year. In addition, we utilize a variety of contact methods to solicit new franchisees. The Telephone Consumer Protection Act ("TCPA") imposes substantial restrictions on the manner in which persons may be contacted, by telephone calls or text, on mobile telephones. We are required to comply with these restrictions in the telephone calls and text messages that we send, and we also make available tools intended to assist our franchisees in ensuring that telephone calls they make and text messages they send are compliant with the TCPA. Violations of the TCPA may result in per-call and per-message penalties of $500 to $1,500, and frequently result in class action litigation. The Federal Communications Commission ("FCC"), which is responsible for regulations relating to the TCPA, has been asked to clarify certain aspects of their regulations that have led to a substantial increase in TCPA litigation, but it is not clear that any significant changes to those regulations will be implemented in the foreseeable future.

Tax course regulations. Our tax courses are subject to regulation under proprietary school laws and regulations in many states. Under these regulations, our tax courses may need to be registered and may be subject to other requirements relating to facilities, instructor qualifications, contributions to tuition guaranty funds, bonding, and advertising.

Foreign regulations. We are subject to a variety of other regulations in the Canadian markets, including anti-corruption laws and regulations. Foreign regulations and laws potentially affecting our business are evolving rapidly. We rely on external counsel in Canada to advise us regarding compliance with applicable laws and regulations.

Employees

As of April 30, 2017, we employed 1,498 employees, consisting of 501 employees in our corporate operations, primarily located in Virginia Beach, Virginia and 997 employees at our Company-owned offices. Many of our employees are seasonal and, by contrast, we had 652 corporate employees and 1,514 employees at our Company-owned offices as of February 29, 2017. As of May 31, 2017, we employed 372 corporate employees and 339 employees at our Company-owned offices. We consider our relationships with our employees to be good.

Available Information

Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports filed with or furnished to the SEC are available, free of charge, through our website at www.libertytax.com as soon as reasonably practicable after such reports are electronically filed with or furnished to the SEC. The public may read and copy any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference room by calling the SEC at 1-800-SEC-0030. The SEC maintains a website at www.sec.gov containing reports, proxy and information statements and other information regarding issuers who file electronically with the SEC.

Item 1A.    Risk Factors.

In addition to the other information contained in this annual report, the following risk factors should be considered carefully in evaluating our business. If any of the risks or uncertainties described below were to occur, our business, financial condition, and results of operations may be materially and adversely affected. Additional risks not presently known to us or that we currently deem immaterial may also impair our business and operations.

Risks Related to Our Business

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Because much of our growth has been achieved through rapidly opening new offices, we may not achieve the same level of growth in revenues and profits in future years.

Historically our growth has been driven by selling franchises and entering into agreements with ADs who have assisted us in expanding our geographic reach. Our future viability, profitability, and growth will depend upon our ability to successfully operate and continue to expand our operations in the United States and Canada. Furthermore, our business has experienced rapid growth in the number of franchisees and office locations in large geographic markets, and our continued growth in those markets may not continue at the same pace. Our ability to continue to grow our business will be subject to a number of risks and uncertainties and will depend in large part on:

• adding new customers and retaining existing customers;

• innovating new products and services to meet the needs of our customers;

• finding new opportunities in our existing and new markets;

• remaining competitive in the tax return preparation industry;

• our ability to offer directly and to facilitate through others the sale of tax settlement products;

• attracting and retaining capable franchisees and ADs;

• maintaining a reputation for quality tax preparation services sufficient to attract and retain customers and franchisees;

• our success in replacing independent preparers with franchisees;

• hiring, training, and retaining skilled managers and seasonal employees; and

• expanding and improving the efficiency of our operations and systems.

There can be no assurance that any of our efforts will prove successful or that we will continue to achieve growth in revenues and profits.

The highly seasonal nature of our business presents a number of financial risks and operational challenges which, if we fail to meet, could materially affect our business.

Our business is highly seasonal, with the substantial portion of our revenue earned in the January through April "tax season" in the United States and Canada each year. The concentration of our revenue-generating activity during this relatively short period presents a number of challenges for us and our franchisees, including:

• cash and resource management during the first eight months of our fiscal year, when we generally operate at a loss and incur fixed costs and costs of preparing for the upcoming tax season;

• compliance with financial covenants under our credit facility, particularly if the timing of our revenue generation deviates from our typical revenue patterns;

• the availability of seasonal employees willing to work for our franchisees for little more than the minimum wage, with minimal benefits, for periods of less than a year;

• the success of our franchisees in hiring, training, and supervising these employees and dealing with turnover rates;

• accurate forecasting of revenues and expenses because we may have little or no time to respond to changes in competitive conditions, markets, pricing, and new product offerings by competitors, which could affect our position during the tax season;

• disruptions in one tax season, including any customer dissatisfaction issues, which may not be discovered until the following tax season; and

• ensuring optimal uninterrupted operations during peak season.

If we experience significant business disruptions during the tax season or if we or our franchisees are unable to meet the challenges described above, we could experience a loss of business, which could have a material adverse effect on our business, financial condition, and results of operations.

Our future success will depend in part upon the continued services of our senior management, including our CEO, as well as our ability to attract and retain capable middle management.

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Failure to maintain the continued services of senior management personnel or to attract and maintain capable middle management could have a material adverse effect on us. If our Chairman and CEO, John Hewitt, or other senior management were to leave the Company, it could be difficult to replace him or her, and our operations and ability to manage day-to-day aspects of our business as well as our ability to continue to grow our business may be materially adversely affected. Our future success will also depend in part upon our ability to attract and retain capable middle management, such as regional directors, consultants for franchised offices, training directors, tax advisors, and computer personnel, having the specific executive skills necessary to assist us and our franchisees. We face competition for personnel from numerous other entities, including competing tax return preparation firms, some of which have significantly greater resources than us.

Because we are not a financial institution, we can only facilitate the sale of financial products through our arrangements with financial institutions and other financial partners and, if these arrangements are terminated for any reason, we may not be able to replace them on acceptable terms or at all.

In the United States, 30% of our revenue during our 2017 fiscal year was directly derived from our facilitation of the sale of financial products provided to our customers by financial institutions and providers, and we believe that percentage may grow in future tax seasons. Our tax return preparation business is also, to some extent, dependent on our ability to facilitate the sale of these products, because our customers are often attracted to our business by the expectation that these products will be available. Financial products that monetize future tax refunds are specialized financial products, and if our arrangements with the financial institutions and other partners that provide our tax settlement products were to terminate and we were unable to secure an alternative relationship on acceptable terms, or at all, our financial results could be materially adversely affected. In addition, any changes in our contractual terms with these financial institutions and other partners that result in a reduction in our fee income, if not offset by customer growth associated with lower fees, could adversely affect our profitability. See "—Risks Related to Regulation of Our Industry—We may be unsuccessful in litigation that characterizes refund transfer products as loans, which could subject us to damages and additional regulation, and which could adversely affect our ability to offer tax settlement products and have a material adverse effect on our operations and financial results."

We may agree with our bank lenders to share in losses associated with our Refund Advance product, which could adversely affect our results of operations.

During recent tax seasons, we entered into a relationship with two bank lenders to offer a Refund Advance product to our customers. Because we may agree with our bank lenders to share in losses associated with the Refund Advance product, this could adversely affect our results of operations.

We face significant competition in the tax return preparation business and face a competitive threat from software providers and internet businesses that enable and encourage taxpayers to prepare their own tax returns.

The tax return preparation industry is characterized by intense competition. We compete with H&R Block, which is larger and more widely recognized than us, and with other national and regional tax services and smaller independent tax return preparation services, small franchisors, regional tax return preparation businesses, accounting firms, and financial service institutions that prepare tax returns as part of their business. Additionally, we believe that many taxpayers in our target market prepare their own returns. The availability of these alternative options may reduce demand for our products and limit the fees our franchisees can charge, and competitors may develop or offer more attractive or lower cost products and services than ours, which could erode our consumer base.

We also face increased competitive challenges from the online and software self-preparer market, including the FFA, a consortium of the IRS, online preparation services that provides free online tax return preparation, and assistance from volunteer organizations that prepare tax returns at no cost for low-income taxpayers. In addition, many of our direct competitors offer certain free online tax preparation and electronic filing options, and limited in-office promotions of free or nominal cost tax preparation services. Government tax authorities, volunteer organizations, and direct competitors may elect to expand free and reduced cost offerings in the future. Intense price competition, including offers of free service, could result in a loss of market share, lower revenues, or lower margins. Our ability to compete in the tax return preparation business depends on our product offerings, price for services, customer service, the specific site locations of our offices, local economic conditions, quality of on-site office management, the ability to file tax returns electronically with the IRS, and the availability of tax settlement products to our customers.

We rely on our own proprietary tax preparation software, and any difficulties in deploying or utilizing our software each tax season could adversely affect our business.

We utilize our own tax preparation software. However, tax changes made by the federal and state governments each year and changes in tax forms require us to make substantial changes to our software before the beginning of each tax season. Although we engage in extensive testing of our software before deploying it in our franchisees' tax preparation offices and

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online, any delays in the availability of IRS forms or instructions or problems with the rollout of the new software each season could delay the ability to file tax returns at the beginning of the tax season and could adversely affect our business.

Our Company-owned offices may not be as successful as our franchised offices.

Historically, almost all Liberty Tax offices have been owned by franchisees, and most of the Company-owned offices we have operated during a tax season have been offices previously operated by former franchisees. For the 2017 tax season, we operated a total of 362 Company-owned offices. Our Company-owned offices may be less successful than our typical franchisee-owned offices because they often represent offices transitioned from a less successful franchisee. For this reason, we are not able to obtain the continuity of staffing in Company-owned offices that we expect to experience in our franchisee-owned offices. As part of our business strategy, we may also take back offices previously operated by franchisees who have elected to exit the system and these offices may face operational and financial challenges which could negatively impact the success of the offices.

The provision of health insurance and other insurance products to customers by our franchisees and their preparers may subject us and our franchisees to additional claims from customers, as well as increased regulatory risk.

As part of our effort to make information about health insurance options available to tax office customers, we have encouraged our franchisees to make licensed insurance agents available in tax offices. A significant number of our franchisees have become or arranged for the availability of insurance agents, and participated in the writing of health insurance policies for customers. The provision of these insurance services subjects our franchisees to a complex regulatory environment, and to potential claims by customers who may become dissatisfied with the insurance products they obtain. Any failure by our franchisees or their employees to comply with applicable insurance laws and regulations could have an adverse effect on our business and subject our franchisees and us to regulatory complaints, and any failure by our franchisees to provide satisfactory insurance services to customers may adversely affect our customer relationships and our business.

Our failure to protect our intellectual property rights may harm our competitive position, and litigation to protect our intellectual property rights or defend against third-party allegations of infringement may be costly.

We regard our intellectual property as critical to the success of our business. Third parties may infringe or misappropriate our trademarks or other intellectual property rights, which could have a material adverse effect on our business, financial condition, or operating results. The actions we take to protect our trademarks and other proprietary rights may not be adequate. Litigation may be necessary to enforce our intellectual property rights, protect our trade secrets, or determine the validity and scope of the proprietary rights of others. There are no assurances that we will be able to prevent infringement of our intellectual property rights or misappropriation of our proprietary information. Any infringement or misappropriation could harm any competitive advantage we currently derive or may derive from our proprietary rights. In addition, third parties may assert infringement claims against us. Any claims and any resulting litigation could subject us to significant liability for damages. An adverse determination in any litigation of this type could require us to design around a third party's patent or to license alternative technology from another party. Litigation is time-consuming and expensive to defend and could result in the diversion of our time and resources. Any claims from third parties may also result in limitations on our ability to use the intellectual property subject to these claims.

Our business relies on technology systems and electronic communications, which, if disrupted, could significantly affect our business.

Our ability to file tax returns electronically and to facilitate tax settlement products depends on our ability to electronically communicate with all of our offices, the IRS, state tax agencies, and the financial institutions that provide the tax settlement products. Our electronic communications network is subject to disruptions of various magnitudes and durations, such as a data breach or server disruption. Any data breach or severe disruption of our network or electronic communications, especially during the tax season, could impair our ability to complete our customers' tax filings, to provide tax settlement products from financial institutions, or to maintain our operations, which, in turn, could have a material adverse effect on our business, financial condition, and results of operations.

We are dependent on our financing sources and any loss of financing could materially and adversely affect our operating results and our ability to expand our business.

We are dependent upon the continued availability of our credit facility, which consists of a term loan and a revolving loan, in order to fund our seasonal needs and for the further expansion of our business. If we were to default on our financing or otherwise lose access to our sources of credit, our ability to provide financing to our franchisees would be significantly impaired and may result in certain offices closing if our franchisees are not able to secure alternative financing for their working capital needs. In addition, our ability to expand our business would be impaired. We may need to obtain new credit arrangements and other sources of financing to continue to provide financing to our franchisees, to meet future obligations, and

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to fund our future growth. Our ability to maintain or refinance our debt and fund other obligations depends on our successful financial and operating performance and the availability of funds from credit markets. There is no assurance that when our credit facility matures in 2019, we will be able to renew or refinance our debt or enter into new credit arrangements on terms similar to those of our existing loans.

Our credit facility contains restrictive covenants and other requirements that may limit our business flexibility by imposing operating and financial restrictions on our operations.

Our credit facility is secured by substantially all of our assets, including the assets of our subsidiaries. We are subject to a number of covenants that could potentially restrict how we carry out our business or that require us to meet certain periodic tests in the form of financial covenants. The restrictions we consider to be material to our ongoing business include the following:

• We must satisfy a "leverage ratio" test that is based on our outstanding indebtedness at the end of each fiscal quarter.

• We must satisfy a "fixed charge coverage ratio" test at the end of each fiscal quarter.

• We must reduce the outstanding balance under our revolving loan to zero for a period of at least 45 consecutive days each fiscal year.

• We must also maintain a minimum net worth requirement, measured at April 30 of each year.

Our credit facility also contains customary affirmative and negative covenants, including limitations on indebtedness; limitations on liens and negative pledges; delivery of financial statements and other information requirements; limitations on investments, loans, and acquisitions; limitations on mergers, consolidations, liquidations, and dissolutions; limitations on sales of assets; limitations on certain restricted payments; and limitations on transactions with affiliates; among others. Our credit facility also includes change of control provisions that may result in our obligations under that facility accelerating if certain change of control events were to occur, including if John Hewitt, our Chairman and CEO, ceases to control our Company.

A breach of any of these covenants, tests, or mandatory payments could limit our ability to borrow funds under the revolving loan or result in a default under our loans. In addition, these covenants may prevent us from incurring additional indebtedness to expand our operations and execute our business strategy, including making acquisitions. We may also from time to time seek to refinance all or a portion of our debt or incur additional debt in the future. Any such future debt or other contracts could contain covenants more restrictive than those in our existing credit facility. Our ability to comply with the covenants, tests, or mandatory payments in our credit facility may be affected by events beyond our control, including prevailing economic, financial, and industry conditions or our ability to make tax settlement products available to our customers. See "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Overview of factors affecting our liquidity—Credit facility."

We are dependent on the timing of the tax filing season, and disruptions in the opening of the tax season may have a material adverse effect on our results of operations and liquidity.

Historically, the federal tax filing season has begun in mid-January, and both we and our franchisees have begun to prepare tax returns in early January with the ability to electronically file those returns beginning in mid-January. For both the 2013 and 2014 tax seasons, the IRS postponed the first date on which it generally accepts electronic filings until the end of January, and in 2013, also delayed the availability of a significant number of tax forms. These delays at the beginning of the tax season were also replicated at the state level in 2013, because of the reliance of states on tax forms that are dependent upon or subject to changes in federal tax forms. The change in the start of the 2013 and 2014 tax filing seasons materially affected our revenue during the fiscal quarter ended January 31 of both years, and also required us to engage in additional borrowing to support both our operations and those of our franchisees because of the delay in receipt of revenue associated with tax filings. Similarly, the Protecting Americans from Tax Hikes Act of 2015 (the "PATH Act"), enacted in 2015 came into effect in 2017, in which the IRS must wait until at least February 15, 2017 to issue refunds to taxpayers who claim the Earned Income Tax Credit or the Additional Child Tax Credit. Substantial delays in the opening of the tax filing season or the funding of processed returns, in future years would likely have an adverse effect on our revenue and liquidity.

Our floating rate debt financing exposes us to interest rate risk.

We may borrow amounts under our credit facility that bear interest at rates that vary with prevailing market interest rates. Accordingly, if we do not adequately hedge our interest rate risk, a rise in market interest rates will adversely affect our financial results. We expect to draw most heavily on our revolving loan from July through January of each year and then repay substantially all of the borrowings by the end of each tax season. Therefore, a significant rise in interest rates during our off-season could have a disproportionate impact on our financial results during these months.

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The lines of business in which we operate involve substantial litigation, and such litigation may damage our reputation or result in material liabilities and losses.

We have been named, from time to time, as a defendant in various legal actions, including arbitrations, class actions, and other litigation arising in connection with our various business activities. Adverse outcomes related to litigation could result in substantial damages and could cause our net income to decline or may require us to alter our business operations. Negative public opinion can also result from our actual or alleged conduct in such claims, possibly damaging our reputation, which could negatively impact our financial performance and could cause the value of our stock to decline. See "Item 3—Legal Proceedings."

If we fail to protect or fail to comply with laws and regulations related to our customers' personal information, we may face significant fines, penalties, or damages and our brand and reputation may be harmed.

Privacy concerns relating to the disclosure of consumer financial information have drawn increased attention from federal and state governments in the United States. The IRS generally prohibits the use or disclosure by tax return preparers of taxpayers' information without the prior written consent of the taxpayer. In addition, the Gramm-Leach-Bliley Act and other Federal Trade Commission ("FTC") regulations require financial service providers, including tax return preparers, to adopt and disclose consumer privacy policies and provide consumers with a reasonable opportunity to opt out of having personal information disclosed to unaffiliated third parties for advertising purposes. We and our franchisees manage highly sensitive client information in our operations, and although we have established security procedures to protect against identity theft and require our franchisees to do the same, a security incident resulting in breaches of our customers' privacy may occur. If the measures we have taken prove to be insufficient or inadequate or if our franchisees fail to meet their obligations in this area, we and our franchisees may become subject to litigation or administrative sanctions, which could result in significant fines, penalties, or damages and harm to our brand and reputation, which in turn could negatively impact our ability to retain our customers. Moreover, although we have some insurance that may defray the cost, the cost of remediating any breach resulting from a cybersecurity incident or other breach of the privacy of customer information would likely be substantial. Furthermore, we may be required to invest additional resources to protect us against damages caused by these actual or perceived disruptions or security breaches in the future. We could also suffer harm to our reputation from a security breach or inappropriate disclosure of customer information. Changes in these federal and state regulatory requirements could result in more stringent requirements and could result in a need to change business practices, including how information is disclosed. These changes could have a material adverse effect on our business, financial condition, and results of operations. Moreover, a significant security breach or disclosure of customer information could so damage our brand and reputation that demand for the services that are provided by us and our franchisees may be reduced.

If our business or the tax industry generally is perceived as a source of identity theft, our reputation may be harmed and our financial performance could be materially adversely affected.

Identity theft and privacy concerns relating to customer information disclosure has been the subject of attention in recent years, including the substantial publicity around identity theft problems involving at least one of our competitors. Further, in May 2015, the IRS announced a significant breach of its data security that resulted in the potential theft of personally identifiable tax information involving more than 100,000 taxpayers. If the use of electronic tax filing becomes perceived by customers as subjecting them to unacceptable identity theft risk, or if we experience a breach of security that subjects a number of our customers to potential identity theft, customers may eschew our services or assisted tax preparation generally, in favor of self-preparation and the avoidance of electronic filing. In such an event, our reputation may be harmed and we may experience a material adverse effect on our business, financial condition and results of operation.

If we or our franchisees fail to comply with the Telephone Consumer Protection Act, we may face significant damages.

The retention of customers by our franchisees, and our ability to attract additional franchisees, depends on the use of telephone calls and text messaging to contact customers and potential franchisees. However, the Telephone Consumer Protection Act (“TCPA”) imposes significant restrictions on the ability to utilize telephone calls and text messages to mobile telephone numbers as a means of communication, when the prior consent of the person being contacted has not been obtained. In fiscal 2015, we settled one lawsuit related to the manner in which a contractor for us previously contacted potential franchisees. Violations of the TCPA may be enforced by individual customers through class actions, and statutory penalties for TCPA violations range from $500 to $1,500 per violation. If we fail to ensure that our own telemarketing and telemarketing efforts are TCPA compliant, or if our franchisees fail to do so and we are held responsible for their behavior, we may incur significant damages.

If we and our franchisees are unable to attract and retain qualified employees, our financial performance could be materially adversely affected.

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Both we and our franchisees depend on the ability to hire a substantial number of seasonal employees for each tax season. We require seasonal employees in order to staff our franchises and customer call centers and Company-owned offices, and our franchisees require employees to implement marketing programs, to act as tax preparers, and to otherwise staff their offices. The ability of our franchisees and us to meet our labor needs is subject to many external factors, including competition for qualified personnel, unemployment levels in each of the markets in which we have offices, prevailing wage rates, minimum wage laws, and workplace regulation. Our franchisees require a substantial number of employees who are willing to become trained as tax preparers, and who have the ability to engage in temporary, seasonal employment. Moreover, in addition to our seasonal employees, we hire a substantial number of full-time employees who are required to have the technical skills necessary to participate in software development, database management, and other highly technical tasks. If we and our franchisees are not able to hire a sufficient supply of qualified seasonal employees, or if we are not able to secure employees with the technical skills we require for other purposes, our ability to serve our customers in our offices, to deploy our marketing programs, and to maintain the services that our franchisees require may be compromised and have a material adverse effect on our business.

An increase in the minimum wage may adversely affect the operations of our franchisees.

Many of the seasonal employees hired by our franchisees for each tax season receive compensation at or near the minimum wage. If our franchisees experience increases in payroll expenses as a result of government-mandated increases in the minimum wage or overtime requirements, such as some of the federal, state and local minimum wage increases recently adopted, their costs of operation may increase at a rate greater than their ability to raise the prices of the services they offer. If this occurs, our franchisees may not be able to maintain seasonal employment at levels that will provide an optimal level of customer service and marketing support, their marketing and advertising programs may be less effective, and their results of operations may be adversely affected, which could, in turn, adversely affect our results of operations.

If credit market volatility affects our financial partners or franchisees, our business and financial performance could be adversely affected.

In recent years, the credit markets experienced unprecedented volatility and disruption, causing many lenders and institutional investors to cease providing funding to even the most creditworthy borrowers or to other financial institutions. If additional credit market volatility prevents our financial partners from providing tax settlement products to our customers, limits the products offered, or results in us having to incur further financial obligations to support our financial partners, our revenues or profitability could decline. The cost and availability of funds has also adversely impacted our franchisees' ability to grow and operate their businesses, which could cause our revenues or profitability to decline. In addition, future disruptions in the credit markets could adversely affect our ability to sell territories to new or existing franchisees, causing our revenues or profitability to decline.

Because the tax season is relatively short and straddles two quarters, our quarterly results may not be indicative of our performance.

We experience quarterly variations in revenues and operating income as a result of many factors, including the highly seasonal nature of the tax return preparation business, the timing of off-season activities, and the hiring of personnel. Due to the foregoing factors, our quarter-to-quarter results vary significantly. In addition, because our peak period straddles the third and fourth quarters, any delay or acceleration in the number of tax returns processed in January may make our year-to-year quarterly comparisons not as meaningful as year-to-year tax season comparisons. To the extent our quarterly results vary significantly from year to year, our stock value may be subject to significant volatility.

Risks Related to Our Franchise Business

Our success is tied to the growth and operations of our franchises, and their operations could adversely affect our business.

Our financial success depends on our franchisees and the manner in which they operate and develop their offices. We do not exercise direct control over the day-to-day operations of our franchises, and our franchisees may not operate their offices in a manner consistent with our philosophy and standards and may not increase the level of revenues generated compared to prior tax seasons. Our growth and revenues may, therefore, be adversely affected. There can be no assurance that the training programs and quality control procedures we have established will be effective in enabling franchisees to run profitable tax preparation businesses or that we will be able to identify problems or take corrective action quickly enough. In addition, failure by a franchisee to provide service at acceptable levels may result in adverse publicity that can materially adversely affect our reputation and ability to compete in the market in which the franchisee is located.

If our franchisees fail to open offices in new territories or if they are not successful in operating their new offices, our franchise-related revenue and results of operation will be adversely affected.

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Each year, we anticipate adding offices to our franchise system but the opening of these offices depends on the purchase of additional territories by our franchisees and on the opening of offices in territories previously purchased and newly purchased. Many factors go into opening a new office, including obtaining a suitable office location, the availability of sufficient start-up capital, and the ability to recruit tax preparers and other personnel to work in new offices. If a significant number of offices that we expect to be open in a tax season fail to open, are delayed, or open in unsuitable locations or with insufficient personnel, the revenue we expect to receive from royalty payments and the repayment of indebtedness to us by our franchisees will be adversely affected. Because we utilize an almost exclusive franchise business model, we do not have the same flexibility to open new offices as our competitors who make greater use of Company-owned offices.

Our operating results may be adversely affected by the default of our franchisees and ADs on loans made by us or third parties.

We extend financing to certain franchisees for initial franchise fees as cash advances for their working capital needs and for other purposes. The financing is in the form of promissory notes payable to us. There can be no assurance that any franchisee will generate revenue sufficient to repay any amounts due nor is there any assurance that any franchisee will be able to repay any amounts due through other means. We also extend financing to ADs from time-to-time for a portion of their area development fees. At April 30, 2017, the aggregate amount due to us, including accrued interest, from franchisees and ADs for financing was $102.7 million, net of unrecognized revenue of $29.4 million, of which we considered $26.0 million to be impaired because the amounts due exceeded the fair value of the underlying franchise. Any failure by the franchisees and ADs to pay these amounts, if the amounts are not recoverable by us through other means, could have a material adverse effect on our financial performance.

Moreover, in some cases, we may be liable for office leases or other contractual obligations that have been assumed by purchasers of Company-owned offices and acquired tax practices. If the franchisees default on third-party obligations for which we continue to have liability, our operating results will be adversely affected.

We may be held responsible by third parties, regulators, or courts for the action of, or failure to act, by our franchisees and be exposed to possible fines, other liabilities, and bad publicity.

We grant our franchisees a limited license to use our registered service marks and, accordingly, there is risk that one or more of the franchisees may be identified as being controlled by us. Third parties, regulators, or courts may seek to hold us responsible for the actions or failures to act by our franchisees. The extent to which franchisors should be held responsible for the behavior of their franchisees has become a more significant issue in recent years, with some government agencies taking the position that the extent to which a franchise system establishes requirements for franchisees may justify treating the franchisor as if it “controls” the franchisee’s behavior. Thus, the failure of our franchisees to comply with laws and regulations may expose us to liability and damages that may have an adverse effect on our business.

The Liberty Tax brand could be impaired due to actions taken by our franchisees, their employees or otherwise.

We believe the Liberty Tax brand is one of our most valuable assets in that it provides us with a competitive advantage, particularly over our competitors that do not have a national presence. Our franchisees operate their businesses under our brand. Because our franchisees are independent third parties with their own financial objectives, actions taken by them, including breaches of their contractual obligations, and negative publicity associated with these actions, could adversely affect our reputation and brand more broadly. Any actions as a result of conduct by our franchisees, their employees or otherwise which negatively impacts our reputation and brand may result in fewer customers and lower revenues and profits for us.

Our tax return preparation compliance program may not be successful in detecting all problems in our franchisee network, and franchisee non-compliance, fraud and other misconduct and related enforcement action may damage our reputation and adversely affect our business.

Although our tax return preparation compliance program seeks to monitor the activities of our franchisees, it is unlikely to detect every problem. While we have implemented a variety of measures to enhance tax return preparation compliance as well as our monitoring of these activities, there can be no assurance that franchisees and tax preparers will follow these procedures. From time to time, the federal and/or state authorities may take adverse action against franchisees or preparers related to tax compliance issues, seeking injunctions, damages or even criminal sanctions with respect to such behavior. Failure to detect and prevent tax return preparation compliance issues could expose us to the risk of government investigation or litigation, result in bad publicity and reputational harm, and could subject us to remedies and loss of customers that could cause our revenues or profitability to decline.

In fiscal 2016, the DOJ announced two lawsuits against certain of our former franchisees and two lawsuits against then-existing franchisees, which concluded in fiscal 2017. Allegations involved claims of fraudulent tax preparation. We were not named as a defendant in these suits. Further, in fiscal 2017, the state of Maryland, Office of the Comptroller suspended the

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processing of electronic and paper returns of one franchisee and two offices in that state. We are cooperating with the applicable governmental authorities in connection with their investigations. We have continued to enhance our Compliance Department tasked with examining and preventing non-compliance, fraud and other misconduct among our franchisees and their employees. Nonetheless, there can be no assurance that our Compliance Department, the tax return preparation compliance program, or other efforts will be effective in eliminating non-compliance, fraud and other misconduct among our franchisees and/or employees. Accordingly, any such non-compliance, fraud or other misconduct may have a material adverse effect on our reputation, financial condition and results of operations.

Disputes with our franchisees may have a material adverse effect on our business.

From time to time, we engage in disputes with some of our franchisees, and some of these disputes result in litigation or arbitration proceedings. Disputes with our franchisees may require us to incur significant legal fees, subject us to damages, and occupy a disproportionate amount of management's time. A material increase in the number of these disputes, or unfavorable outcomes in these disputes, may have a material adverse effect on our business. To the extent we have disputes with our franchisees, our relationships with our franchisees could be negatively impacted, which could hurt our growth prospects or negatively impact our financial performance.

Our operating results depend on the effectiveness of our marketing and advertising programs and franchisee support of these programs.

Our revenues are heavily influenced by brand marketing and advertising. If our marketing and advertising programs are unsuccessful, we may fail to retain existing customers and attract new customers, which could limit the growth of our revenues or profitability or result in a decline in our revenues or profitability. Moreover, because franchisees are required to pay us marketing and advertising fees based on a percentage of their revenues, our marketing fund expenditures are dependent upon sales volumes of our franchisees.

The support of our franchisees is critical for the success of our marketing programs and any new strategic initiatives we seek to undertake. While we can mandate certain strategic initiatives through enforcement of our franchise agreements, we need the active support of our franchisees if the implementation of our marketing programs and strategic initiatives is to be successful. Although certain actions are required of our franchisees under the franchise agreements, there can be no assurance that our franchisees will continue to support our marketing programs and strategic initiatives. The failure of our franchisees to support our marketing programs and strategic initiatives would adversely affect our ability to implement our business strategy and could have a material adverse effect on our business, financial condition, and results of operations.

Our launch of a new franchise brand or other business ventures may be unsuccessful and consume significant management and financial resources.

During fiscal 2015, we launched a new franchise brand, SiempreTax+, designed to enable our franchisees to better serve Hispanic customers and to assist us in building out our franchise network. Although franchisees opened a significant number of SiempreTax+ offices for the 2017 and 2016 tax seasons, the launch of a new nationwide brand involves substantial risks and uncertainties, and the interest of prospective franchisees and customers in the new brand may not be sufficient to permit us to grow the brand as rapidly as we hope. We expended significant management time and start-up expenses during the first year of this brand, and if the brand is not successful or falls short of anticipated growth, we may be adversely affected by continued expenses and the diversion of management time to this initiative at the expense of our core Liberty Tax brand. In the future, we may also launch additional business brands or initiatives which could negatively impact our financial performance if unsuccessful or underperforming.

Risks Related to Regulation of Our Industry

Federal and state regulators may impose new regulations on non-loan tax settlement products that would make those products more expensive for us to offer or more difficult for our customers to obtain.

Consumer advocacy organizations and some government officials have asserted that non-loan tax settlement products, such as the refund transfer products we offer, should be treated as loan products or otherwise be more heavily regulated. These groups assert that refund transfer products and similar products are loans because most customers complete the payment for their tax preparation and related fees at the time their refund is disbursed, and therefore, the customer has received an extension of credit because of a purported deferral of the tax preparation fees until the refund is received. We are subject to a judgment in the State of California that treats refund transfer product products that we provide in that state as if they were extensions of credit. In addition, certain litigation discussed below involving us and others in the tax industry include claims that refund transfer products and similar products constitute loans or extensions of credit. If other state or federal courts or agencies successfully require us to treat refund transfer products as if they are loans or extensions of credit, we may be subject to the cost of additional regulation, including disclosure requirements that could reduce the demand for these products by potential

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customers and may be subject to limitations on our ability to offer these products, which could materially adversely affect our operations. See "Item 3—Legal Proceedings" and "Item 1—Business—Regulation—Potential regulation of refund transfer products or treatment of refund transfer products as loans or extensions of credit."

We may be unsuccessful in litigation that characterizes refund transfer products as loans, which could subject us to damages and additional regulation, and which could adversely affect our ability to offer tax settlement products and have a material adverse effect on our operations and financial results.

We were sued in November 2011 in four states, and additional lawsuits have been filed in five other states since the initial filings. These cases have now been consolidated before a single judge in federal court in the Northern District of Illinois. The consolidated complaint alleges violations of state-specific refund anticipation loan and other consumer statutes alleging that a refund transfer product represents a form of refund anticipation loan because the taxpayer is "loaned" the tax preparation fee, and that a refund transfer product is, therefore, subject to federal truth-in-lending disclosure and state law requirements regulating refund anticipation loans. We are aware that virtually identical lawsuits were filed against three of our competitors. In June 2015, we entered into a settlement agreement in this case in order to minimize the expense of litigation and the risk attendant to the litigation. Although this case was resolved through a settlement, the underlying issue may be the subject of additional regulation and litigation. We may also become subject to existing state regulations governing refund anticipation loans (in the states that have such regulations) and the costs of additional regulation, including disclosure requirements, and we may be subject to limitations on our ability to offer these products. These additional disclosure requirements could reduce the demand for these products by potential customers, and the possible application of state lending and other refund anticipation loan-related statutes and regulations might adversely affect our fee income to the extent those statutes or regulations impose limitations on fees that we now charge in connection with refund transfer products. If it becomes more difficult for us and our franchisees to offer these products to taxpayers, or if we are subject to damages in future litigation, it could materially and adversely affect our operations and financial results. See "Item 1-Business-Regulation-Potential regulation of refund transfer products or treatment of refund transfer products as loans or extensions of credit."

The failure by us, our franchisees, the financial institutions, and other lenders that provide tax settlement products to our customers through us and our franchisees, to comply with legal and regulatory requirements, including with respect to tax return preparation or tax settlement products, could result in substantial sanctions against us or require changes to our business practices that could harm our profitability and reputation.

Our tax return preparation business, including our franchise operations and facilitation of tax settlement products, are subject to extensive regulation and oversight in the United States by the IRS, the FTC, and by federal and state regulatory and law enforcement agencies and similar entities in Canada. The profitability of our future operations will, therefore, depend in large part on our continued ability to comply with federal and state franchise regulations, and in Canada, on our continued ability to comply with Canadian and provincial franchise regulations. If governmental agencies with jurisdiction over our operations were to conclude that our business practices, the practices of our franchisees, or those of financial institutions and other lenders with which we conduct our business violate applicable laws, we could become subject to sanctions that could have a material adverse effect on our business, financial condition, and results of operations. These sanctions may include, without limitation:

• civil monetary damages and penalties,

• criminal penalties, and

• injunctions or other restrictions on the manner in which we conduct our business.

In addition, the financial institutions and other providers of tax settlement products to our customers are also subject to significant regulation and oversight by federal and state regulators, including banking regulators. The failure of these providers to comply with the regulatory requirements of federal and state government regulatory bodies, including banking and consumer protection laws, could affect their ability to continue to provide tax settlement products to our customers, which could have a material adverse effect on our business, financial condition, and results of operations.

Our customers' inability to obtain tax settlement products through our tax return preparation offices could cause our revenues or profitability to decline. We also may be required to change business practices, which could alter the way tax settlement products are facilitated and could cause our revenues or profitability to decline.

Federal and state legislators and regulators have taken an active role in regulating tax settlement products and, because our ability to offer these products in future tax seasons may be limited, demand for our services may be reduced, we may be exposed to additional credit risk, and our business may be harmed.

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Financial institutions that provide or otherwise facilitate tax settlement products are subject to significant regulation and oversight by federal and state regulators, including banking regulators.  Federal and state laws and regulations govern numerous matters relating to the offering of consumer loan products, such as Refund Advances, and consumer deposit products such as refund transfers.  From time to time, government officials at the federal and state levels may introduce and enact legislation and regulations proposing to further regulate or prevent the facilitation of refund-based loans and other tax settlement products and take other actions that have the effect of restricting the availability of these products. In July 2011, the Consumer Financial Protection Bureau (“CFPB”) was created by the Dodd-Frank Act to administer and enforce consumer protection laws and regulation in the financial sector. Certain proposed legislation, regulations, and activities by CFPB or other regulators could increase costs to us, our franchisees, the financial institutions, and other parties that provide our tax settlement products or could negatively impact or eliminate the ability of financial institutions to provide or facilitate tax settlement products through tax return preparation offices.

Even if we were to develop relationships that allow our customers to obtain refund-related loans through non-bank lenders, the laws and regulations that apply to those financial institutions and us may make these products more expensive to offer or limit their availability to our customers. In addition, many states have statutes regulating through licensing and other requirements the activities of brokering loans and providing credit services to consumers as well as payday loan laws and local usury laws. Some state regulators are interpreting these laws in a manner that could adversely affect the manner in which tax settlement products are facilitated, or permitted, or result in fines or penalties to us or our franchisees. Some states are introducing and enacting legislation that would seek to directly apply such laws to the facilitators of refund-based loans. Additional states may interpret these laws in a manner that is adverse to how we currently conduct our business or how we have conducted our business in the past, and we may be required to change business practices or otherwise comply with these statutes and could be subject to fines, penalties, or other payments related to past conduct.

If our financial product service providers become unable or unwilling to enable us to offer refund transfer products, we may be unable to offer tax settlement products to our customers.

Our ability to offer refund transfer products (as well as other tax settlement products that require the creation of a customer bank account) is dependent on the ability and willingness of our financial product service providers to make available to our customers the bank accounts into which their tax refunds are deposited. If any of the federal or state regulatory authorities with the power to regulate these service providers prevents or makes it more difficult for our service providers to make these bank accounts available to our customers or if the service providers determine that they no longer wish to participate in these transactions, we may be unable to find alternative service providers that will be willing to provide the required number of bank accounts to our customers. If we are unable to make bank accounts available for refund transfer products, we will not be able to enable our customers to utilize these accounts for the direct deposit of their federal and state tax returns, which would materially affect our ability to offer tax settlement products to those customers.

Legislative and regulatory reforms may have a significant impact on our business, results of operations, and financial condition.

In July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Reform Act"), which contains a comprehensive set of provisions designed to govern the practices and oversight of financial institutions and other participants in the financial markets, was signed into law. The full impact of the Reform Act is difficult to assess because many provisions require federal agencies to adopt regulations implementing provisions of the Reform Act. In addition, the Reform Act mandates multiple studies, which could result in additional legislative or regulatory action. The Reform Act as well as other legislative and regulatory changes could adversely affect our businesses. There is particular risk associated with the establishment of the CFPB with broad authority to implement new consumer protection regulations. For example, the CFPB may pursue initiatives that negatively impact our ability and the ability of others we contract with to offer tax settlement products, may impose regulations on the manner in which tax preparation services are offered, and may take action to invalidate the use of consumer arbitration as a means of resolving customer disputes in connection with tax settlement products and otherwise.

The effect of the Reform Act on our business and operations could be significant, depending upon final implementation of regulations, the initiatives pursued by the CFPB, the actions of our competitors, and the behavior of other marketplace participants. Moreover, the Reform Act expanded the authority of state regulators to enforce and promulgate consumer protection laws and regulations, and this expansion of state authority may result in new and broader consumer protection requirements that might be more comprehensive than those at the federal level.In addition, we may be required to invest significant management time and resources to address the various provisions of the Reform Act and the numerous regulations that are required to be issued under it. The Reform Act and any related federal or state legislation or regulations could have a material adverse effect on our business, results of operations, and financial condition.

Increased regulation of tax return preparers could make it more difficult to find qualified tax preparers and could harm our business.

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From time to time, the federal government and various states consider regulations regarding the education, testing, licensing, certification, and registration of tax return preparers. Although the IRS’ effort to implement a new model for tax return preparer regulation has been declared invalid by a federal appeals court, Congressional action authorizing mandatory regulation may be adopted in the future, and various states have begun to fill the void created by the absence of federal tax return preparer regulation by proposing new or enhanced regulatory requirements at the state level. Although we believe that our training for preparers already exceeds the requirements the IRS had proposed and that states have adopted or have proposed, regulation of tax return preparers could impact our ability to find an adequate number of tax return preparers to meet the demands of our customers and impose additional costs on us and our franchisees to train tax return preparers, which could cause our revenues and profitability to decline.

Immigration reform may lead our customers to seek our assistance with matters related to immigration reform and may subject us to additional regulatory risk.

We believe that any material immigration reform, whether implemented by executive action or by Congress, will necessarily involve the use of prior tax returns as a means by which undocumented immigrants may demonstrate their presence in the United States and compliance with federal and state tax laws. We anticipate that any additional customers we might obtain because of this opportunity to prepare additional tax returns may also seek our assistance in their efforts to comply with whatever processes are implemented to enable undocumented immigrants to take advantage of the benefits of any immigration reform initiatives. We and our franchisees may be subject to state restrictions on the unauthorized practice of law, and other federal and state restrictions regarding who may advise individuals with respect to immigration matters, and failure to comply with these regulatory restrictions may subject us and our franchisees to enforcement action and adversely affect our business.

Risks Related to Changes in Tax Laws and Regulations

Because demand for our products is related to the complexity of tax return preparation and the frequency of tax law changes, government initiatives that simplify tax return preparation, reduce the need for a third-party tax return preparer, or lower the number of returns required to be filed may decrease demand for our services and financial products.

Many taxpayers seek assistance from paid tax return preparers such as Liberty Tax Service because of the level of complexity involved in tax return preparation and filing and frequent changes in the tax laws. From time to time politicians and government officials propose measures seeking to simplify the preparation and filing of tax returns. The passage of any measures that significantly simplify tax return preparation or reduce the need for third-party tax return preparers may be highly detrimental to our business. In addition, any changes or other initiatives that result in a decrease in the number of tax returns filed or reduce the size of tax refunds could reduce demand for our products and services causing our revenues or profitability to decline.

For example, several members of Congress have proposed legislation that would authorize or require the IRS to allow taxpayers to access web-based tax preparation tools that would include "pre-populated" tax return forms that would presumably include data provided to the IRS from other government agencies, such as the Social Security Administration. If these or similar proposals that involve government encroachment on the tax preparation process are enacted, many tax customers might elect those services rather than paid tax preparation or the use of fee-based tax software or online tax preparation.

Initiatives that improve the timing and efficiency of processing tax returns could reduce the attractiveness of the tax settlement products offered to our customers and demand for our services.

Our performance depends on our ability to offer access to tax settlement products that increase the speed and efficiency by which our customers can receive their refunds. The federal government and various state and local municipalities have, from time to time, announced initiatives designed to modernize their operations and improve the timing and efficiency of processing tax returns. For example, during a prior tax season, the U.S. Department of Treasury introduced a prepaid debit card pilot program designed to facilitate the refund process. If tax authorities are able to significantly increase the speed and efficiency with which they process tax returns, the value and attractiveness of the tax settlement products offered to our customers and demand for our services could be reduced.

Delays in the passage of tax laws and their implementation by the federal or state governments could harm our business.

The enactment of tax legislation occurring late in the calendar year could result in the beginning of tax filing season being delayed or make it difficult for us to make necessary changes on a timely basis to the software used by our franchisees to prepare tax returns. Any such delays could impact our revenues and profitability in any given year.

Proposals to make fundamental changes in the way tax refunds are processed or to impose price limitations on tax preparation, if enacted, could result in substantial losses of customers and other risks.

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Some regulators have suggested that it would be appropriate to allow taxpayers to "split" their tax refunds, in a manner that would separate the payment of tax preparation fees from the balance of a customer's refund. In describing these proposals, some advocates have called for a cap on tax preparation fees that would adversely affect the ability of tax preparers to charge market prices for tax services and could reduce income to our franchisees, and therefore, to us. Other proposals have been advanced that would attempt to reduce tax refund fraud by significantly postponing the speed with which refunds are processed, or even postponing the processing of refunds until after the April 15 federal tax filing deadline. Such a change would likely have the effect of devaluing services that allow tax customers in the early portion of the tax season to receive their refunds on a more expedited basis that is available when electronic filing is not used, and could therefore reduce the demand for the services we and our franchisees provide.

There can be no assurance that these proposals will be enacted at all or in their present form but if enacted, our growth and revenues could be adversely affected.

Our participation in government programs designed to speed access to tax refunds may result in customer loss when the IRS fails to perform.

The IRS has responded to the increase in electronic filing by developing programs designed to reduce a taxpayer's wait to receive a tax refund. In the past, we participated in some programs offered by the IRS that did not perform as expected, resulting in significant delays in processing refunds for some of our customers. Although we continue to seek to give our customers quicker access to their refunds, doing so involves the risk of customer dissatisfaction and injury to our reputation in the market if the IRS fails to perform, which is outside our control.

Risks Related to Our Class A Common Stock

We are controlled by our Chairman and Chief Executive Officer, whose interests in our business may be different from those of our stockholders.

John Hewitt, our Chairman and Chief Executive Officer, currently owns all outstanding shares of our Class B common stock. Our Class B common stock has the power to elect, voting as a separate class, the minimum number of directors that constitute a majority of the Board of Directors. As a result, Mr. Hewitt will, for the foreseeable future, have significant influence over our management and affairs, given the Board's authority to appoint or replace our senior management, cause us to issue additional shares of our Class A common stock or repurchase Class A common stock, declare dividends, or take other actions. Upon Mr. Hewitt’s death, pending the effectiveness of a provision of our certificate of incorporation that will become effective only after we have conducted an initial public offering or certain other triggering events occur, Mr. Hewitt’s estate would succeed to these special voting rights. Mr. Hewitt may make decisions regarding our Company and business that are opposed to other stockholders' interests or with which they disagree. Mr. Hewitt's ability to elect a majority of the Board of Directors may also delay or prevent a change of control of us, even if that change of control would benefit our stockholders, which could deprive an investor of the opportunity to receive a premium for your Class A common stock. The power to elect a majority of the directors may adversely affect the value of our Class A common stock due to investors' perception that conflicts of interest may exist or arise. To the extent that the interests of our other stockholders are harmed by the actions of Mr. Hewitt, the price of our Class A common stock may be harmed. For information regarding the ownership of our outstanding stock, please see the section titled "Item 12-Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters."

Because we are not required to comply with certain NASDAQ corporate governance requirements, our stockholders may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the NASDAQ.

Because Mr. Hewitt owns all of the outstanding shares of our Class B common stock, and therefore, has the ability to elect a majority of our directors, we have elected to be a "controlled company" for the purposes of the NASDAQ listing requirements. As such, we are exempt from certain corporate governance requirements, including the requirements that our Board of Directors be comprised of a majority of directors who are independent under NASDAQ rules and that we have nominating and compensation committees with members meeting the NASDAQ independence requirements. We currently are voluntarily complying with the NASDAQ's corporate governance standards but may choose not to in the future. If we choose not to comply with certain of the requirements, our Board of Directors may have more directors who do not meet the NASDAQ independence standards than they would if those standards were to apply. We may also elect not to maintain formal nominating/corporate governance and compensation committees or, if we maintain those committees, they may not be comprised of independent directors. In such circumstances, you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the NASDAQ, and circumstances may occur in which the interests of Mr. Hewitt could conflict with the interests of our other stockholders.

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Our stock price has been extremely volatile, and investors may be unable to resell their shares at or above their acquisition price or at all.

Our stock price has been, and may continue to be, subject to wide fluctuations in response to many risk factors listed in this section, and others beyond our control, including:

• actual or anticipated variations in our operating results from quarter to quarter;

• actual or anticipated variations in our operating results from the expectations of securities analysts and investors;

• actual or anticipated variations in our operating results from our competitors;

• fluctuations in the valuation of companies perceived by investors to be comparable to us;

• sales of Class A common stock or other securities by us or our stockholders in the future;

• changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors;

• certain non-compliance, fraud and other misconduct by our franchisees and/or employees;

• departures of key executives or directors;

• announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, financing efforts or capital commitments;

• delays or other changes in our expansion plans;

• involvement in litigation or governmental investigations or enforcement activity;

• stock price and volume fluctuations attributable to inconsistent trading volume levels of our shares;

• general market conditions in our industry and the industries of our customers;

• general economic and stock market conditions;

• regulatory or political developments; and

• terrorist attacks or natural disasters.

Furthermore, the capital markets experience extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political, and market conditions such as recessions, interest rate changes, or international currency fluctuations may negatively impact our stock price. Trading price fluctuations may also make it more difficult for us to use our Class A common stock as a means to make acquisitions or to use options to purchase our Class A common stock to attract and retain employees. If our stock price does not exceed the price at which stockholders acquired their shares, investors may not realize any return on their investment. In the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert our management's attention from other business concerns, which could materially adversely affect our business, results of operations, and financial position.

A significant portion of our outstanding shares of Class A common stock may be sold into the market, which could adversely affect our stock price.

Sales of a substantial number of shares of our Class A common stock in the public market could occur at any time, subject to certain securities law restrictions. Sales of shares of our Class A common stock or the perception in the market that the holders of a large number of shares of Class A common stock intend to sell shares could reduce our stock price. As of July 3, 2017, we have outstanding 12,682,550 shares of Class A common stock and 200,000 shares of Class B common stock, which are convertible into shares of Class A common stock on a one-for-one basis, assuming no exercise of our outstanding options.

At July 3, 2017, we also have approximately 0.9 million shares of our Class A common stock reserved for issuance in connection with options and restricted stock units granted under our 1998 Stock Option Plan and the 2011 Equity and Cash Incentive Plan. These shares may also be freely sold in the public market upon issuance and once vested.

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The trading in our Class A Common Stock is limited.

Because of the number of shares of our Class A common stock held by affiliates, the volume of typical trading in our stock on the NASDAQ Stock Market has been limited. This limitation on the liquidity of our stock may impede the ability of our stockholders to sell shares at the time they wish to sell them at a price that they consider reasonable or at all, and could reduce our stock price and impede our ability to acquire other companies using our shares as consideration.

Our stock price and trading volume could decline if securities or industry analysts do not publish research or reports about our business or if they publish misleading or unfavorable research or reports about our business.

The trading market for our Class A common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. As of the date of this report, only two securities analysts engage in coverage of our Class A common stock, and if few securities or industry analysts commence or maintain such coverage, the trading price and liquidity for our shares could be adversely impacted. In the event we obtain securities or industry analyst coverage, if one or more of the analysts who covers us downgrades our stock or publishes misleading or unfavorable research about our business, our stock price could decline. If one or more of these analysts ceases to cover us or fails to publish reports on us regularly, demand for our stock could decrease, which could cause our stock price or trading volume to decline.

We incur increased costs and our management will face increased demands as a result of operating as a company with public equity.

As a company with public equity, we incur significant legal, accounting, and other expenses. In addition, the Sarbanes-Oxley Act, as well as related rules implemented by the SEC and NASDAQ, impose various requirements on companies with public equity. As a public company, we are required to:

• prepare and distribute periodic public reports and other stockholder communications in compliance with our obligations under the federal securities laws and NASDAQ rules,

• create or expand the roles and duties of our Board of Directors and committees of the Board of Directors,

• institute more comprehensive financial reporting and disclosure compliance functions,

• supplement our internal accounting and auditing function,

• enhance and formalize closing procedures at the end of our accounting periods,

• enhance our investor relations function,

• establish new or enhanced internal policies, including those relating to disclosure controls and procedures, and

• involve and retain to a greater degree outside counsel and accountants in the activities listed above.

Our management and other personnel have devoted a substantial amount of time to these compliance matters. Also, these rules and regulations have increased our legal and financial compliance costs and have made some activities more time-consuming and costly than would be the case for a private company. For example, these rules and regulations have made it more expensive for us to maintain director and officer liability insurance. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our Board of Directors or as our executive officers.

In addition, as a result of being a public company, we are subject to financial reporting and other requirements including NASDAQ continued listing requirements that are burdensome and costly. Our failure to timely complete our analysis of these reporting requirements could adversely affect investor confidence in our Company and, as a result, the value of our common stock. Further, if we fail to implement these reporting requirements, our ability to report our results of operations on a timely and accurate basis could be impaired. In fact, in connection with restating our previously issued annual and quarterly consolidated financial statements, we were delinquent in filing our annual and quarterly reports. Consequently, we received two notices from NASDAQ in connection with the delinquent filings, and we may be subject to NASDAQ delisting procedures if we fail to comply with the NASDAQ continued listing requirements in the future.

We are an "emerging growth company" and our election to delay adoption of new or revised accounting standards applicable to public companies may result in our financial statements not being comparable to those of other public companies. As a result of this and other reduced disclosure and governance requirements applicable to emerging growth companies, our common stock may be less attractive to investors.

We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") enacted in April 2012, and we intend to take advantage of certain exemptions from various reporting requirements that are

26

applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"); the same reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements that smaller reporting companies are permitted to provide; and exemptions from the requirements of holding a nonbinding advisory stockholder vote on executive compensation, frequency of approval of executive compensation, and of any golden parachute payments not previously approved. In addition, Section 107 of the JOBS Act also provides that an emerging growth company may take advantage of the extended transition period provided in the Securities Act of 1933 (the "Securities Act") and the Securities Exchange Act of 1934 (the "Exchange Act") for complying with new or revised accounting standards. In other words, an emerging growth company may delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are electing to delay such adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result of this election, our financial statements may not be comparable to the financial statements of other public companies. We cannot predict whether investors will find our common stock less attractive because we will rely on these exemptions. We will remain an "emerging growth company" until the earliest of (i) the last day of the fiscal year during which we have total annual gross revenue of $1 billion or more; (ii) the last day of the fiscal year following the fifth anniversary of the sale by us of common equity securities pursuant to an effective registration statement under the Securities Act; (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt; or (iv) the date on which we are deemed to be a "large accelerated filer," as defined under the Exchange Act.

Although we may desire to continue to pay dividends in the future, our financial condition, debt covenants, or Delaware law may prohibit us from doing so.

Until our dividend paid in April 2015, we had never declared or paid a cash dividend on our common stock. Although we have announced a $0.16 per share quarterly cash dividend and may continue to pay cash dividends in the future, the payment of dividends will be at the discretion of our Board of Directors and will depend, among other things, on our earnings, capital requirements, and financial condition. Our ability to pay dividends will also be subject to compliance with financial covenants that are contained in our credit facility and may be restricted by any future indebtedness that we incur or issuances of preferred stock. In addition, applicable law requires our Board of Directors to determine that we have adequate surplus prior to the declaration of dividends. We cannot provide an assurance that we will continue to pay dividends at any specific level or at all.

Anti-takeover provisions in our charter documents, Delaware law, and our credit facility could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management, and adversely affect the value of our Class A common stock.

Provisions in our amended and restated certificate of incorporation and bylaws may have the effect of delaying or preventing a change of control or changes in our management. We have two classes of common stock, one of which is entitled to elect a majority of our Board of Directors and is controlled by our Chairman and CEO as described above. Our amended and restated certificate of incorporation and bylaws also include provisions that:

• authorize our Board of Directors to issue, without further action by the stockholders, up to approximately 3.0 million shares of undesignated preferred stock;

• specify that special meetings of our stockholders can be called only by our Board of Directors, the Chair of our Board of Directors, or holders of at least 20% of the shares that will be entitled to vote on the matters presented at such special meeting;

• establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our Board of Directors; and

• do not provide for cumulative voting in the election of directors.

In addition, our credit facility contains covenants that may impede, discourage, or prevent a takeover of us. For instance, upon a change of control, we would default on our credit facility. As a result, a potential takeover may not occur unless sufficient funds are available to repay our outstanding debt.

These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board of Directors, which is responsible for appointing the members of our management. Any provision of our amended and restated certificate of incorporation and bylaws or our debt documents that has the effect of delaying or deterring a change of control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect our stock value if they are viewed as discouraging takeover attempts in the future.

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Item 1B.    Unresolved Staff Comments.

None.

Item 2.    Properties.

We own our corporate headquarters, located in four buildings, totaling approximately 96 thousand square feet. Our principal executive office is located at 1716 Corporate Landing Parkway, Virginia Beach, Virginia 23454. We also own additional properties in Ohio, New York, Tennessee, and Virginia, which are used as Company-owned offices or leased to franchisees. The remainder of our Company-owned offices are operated under leases. We believe that our offices are in good condition and sufficient to meet our present and anticipated future needs.

Item 3.    Legal Proceedings.

For information regarding legal proceedings, please see "Note 15 - Commitments and Contingencies" in the Notes to the Consolidated Financial Statements, which information is incorporated herein by reference.

Item 4.    Mine Safety Disclosures.

Not applicable.

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PART II

Item 5.    Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities.

Market and Stock Information

Our Class A common stock has been listed on The NASDAQ Global Market under the symbol "TAX" since July 2, 2012. We traded on the over-the-counter bulletin board from June 14, 2012 until that date. Prior to that time, there was no public market for our Class A common stock. The following table sets forth for the periods indicated the high and low sale prices of our Class A common stock on The NASDAQ Global Market.

	2017				2016
	Sales Price				Sales Price
	High		Low		High		Low
First Quarter	$	15.14	$	9.95	$	27.72	$	19.93
Second Quarter	14.51		11.25		26.01		21.84
Third Quarter	15.52		11.28		24.22		17.04
Fourth Quarter	16.20		13.25		21.25		11.78

As of April 30, 2017, our stockholders' equity consisted of the following: 12,682,550 shares of Class A common stock, 200,000 shares of Class B common stock, 10 shares of special voting preferred stock and 1,000,000 exchangeable shares which we treat as common stock equivalents. As of April 30, 2017, options to acquire 1,387,331 shares of Class A common stock were outstanding, 709,213 of which were immediately exercisable.

Holders of Record

As of July 3, 2017, we had approximately 209 registered record holders of our Class A common stock and one holder of our Class B common stock. The reported closing price of our Class A common stock on July 3, 2017 was $13.20, Wells Fargo Shareowner Services is the transfer agent and registrar for our Class A common stock. We have no established public trading market for our Class B common stock.

Dividends

Until our dividend paid in April 2015, we had never declared or paid a cash dividend on our common stock. Although we have announced a $0.16 per share quarterly cash dividend and may continue to pay cash dividends in the future, the payment of dividends will be at the discretion of our Board of Directors and will depend, among other things, on our earnings, capital requirements, and financial condition. Our ability to pay dividends will also be subject to compliance with financial covenants that are contained in our credit facility and may be restricted by any future indebtedness that we incur or issuances of preferred stock. In addition, applicable law requires our Board of Directors to determine that we have adequate surplus prior to the declaration of dividends. We cannot provide an assurance that we will continue to pay dividends at any specific level or at all.

Share Repurchases

Our Board of Directors has authorized up to $10.0 million for share repurchases. This authorization has no specific expiration date and cash proceeds from stock option exercises increase the amount of the authorization. In addition, the Board of Directors authorized an Area Developer repurchase program which reduces the amount of the share repurchase authorization on a dollar for dollar basis. Shares repurchased from option exercises and RSUs vesting that are net-share settled by us and shares repurchased in privately negotiated transactions are not considered share repurchases under this authorization.

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Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plan	Remaining Maximum Value of Shares that may be Purchased Under the Plan
February 1 through February 29, 2017	—	$	—	—	$	8,493
March 1 through March 31, 2017	—	—		—	8,493
April 1 through April 30, 2017	—	—		—	8,493
Total	—			—

During fiscal 2017, we repurchased 33,153 shares of our Class A common stock as shown in the table below:

Period	Total Number of Shares Purchased	Average Price Paid per Share
First quarter	—	$	—
Second quarter (1)	3,118	12.62
Third quarter (2)	30,035	12.58
Fourth quarter	—	—
Total	33,153	12.58

(1)    Share repurchases related to the net-share settlements of RSUs vesting.

(2)    Shares repurchased in privately negotiated transaction with a director.

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Stock Performance Graph

The graph below compares the cumulative total return provided stockholders on the Company's Class A common stock relative to the cumulative total returns of the Russell 2000 index and the S&P Diversified Commercial & Professional Services index. Returns assume an initial investment of $100 at the market close on June 14, 2012, and then for the periods ended April 30, 2013, 2014, 2015, 2016, and 2017. Dividends, if any, are assumed to have been reinvested.

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Item 6.    Selected Financial Data.

The following selected consolidated financial data should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Item 7 below and our Consolidated Financial Statements and related notes included in Item 15. We derived the consolidated statements of income data for the years ended April 30, 2017, 2016, and 2015 and the consolidated balance sheet data as of April 30, 2017 and 2016 from our audited consolidated financial statements included in Item 8. The consolidated statements of income data for the years ended April 30, 2014 and 2013 and the consolidated balance sheet data as of April 30, 2014 and 2013 are derived from our audited consolidated financial statements and restated unaudited consolidated financial statements for such periods, respectively, not included in this annual report. Our historical results are not necessarily indicative of the results that may be expected in the future.

	Fiscal Years Ended and as of April 30,
	2017			2016			2015			2014			2013
	(amounts in thousands, except per share, franchisees, offices, per franchisee amounts, fee per tax return, and per office amounts)
Consolidated Statements of Income Data:
Total revenue	$	173,985		$	173,429		$	162,172		$	159,696		$	147,613
Total operating expenses	(150,664		)	(140,941		)	(146,780		)	(124,875		)	(116,777		)
Income from operations	23,321			32,488			15,392			34,821			30,836
Net income	$	13,013		$	19,420		$	8,690		$	21,982		$	17,627

Consolidated Balance Sheet Data:
Amounts due from franchisees and ADs less unrecognized revenue, net of allowances	$	90,728	$	95,226	$	86,680	$	81,480	$	85,658
Property, equipment, and software, net	39,789		40,957		36,232		38,343		33,037
Total assets	204,268		193,223		183,994		198,640		169,363
Long-term obligations, including current installments	26,199		23,440		25,245		28,365		27,516
Total stockholders' equity	116,455		111,501		98,862		110,185		81,836

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	Fiscal Years Ended and as of April 30,
	2017		2016		2015		2014		2013
	(amounts in thousands, except per share, franchisees, offices, per franchisee amounts, fee per tax return, and per office amounts)
Other Financial and Operational Data:
Adjusted EBITDA(1)	$	42,404	$	43,208	$	42,787	$	44,734	$	40,424
Permanent	3,710		3,960		3,764		3,663		3,816
Seasonal	67		211		262		486		427
Processing Centers	46		54		43		26		19
Number of U.S. offices	3,823		4,225		4,069		4,175		4,262
Number of Canadian offices	254		262		259		263		258
Number of offices	4,077		4,487		4,328		4,438		4,520
Number of U.S. franchisees	1,753		1,856		1,907		1,959		2,073
Number of Canadian franchisees	133		130		125		145		138
Number of franchisees	1,886		1,986		2,032		2,104		2,211
Average number of offices per U.S. franchisee(2)	2.00		2.14		2.07		2.04		1.94
Average number of offices per Canadian franchisee(2)	1.58		1.62		1.62		1.57		1.67
Average number of offices per franchisee(2)	1.97		2.10		2.04		2.01		1.93
Number of tax returns filed in U.S. offices	1,657		1,832		1,907		1,890		1,805
Number of tax returns filed in Canadian offices	359		330		340		311		311
Number of tax returns filed online(3)	138		145		167		187		159
Number of tax returns filed	2,154		2,307		2,414		2,388		2,275
Systemwide revenue from U.S. offices(4)	$	386,000	$	417,600	$	413,200	$	397,300	$	358,000
Systemwide revenue from Canadian offices (CN$)(4)	28,700		27,400		26,400		23,900		23,200
Systemwide revenue from Canadian offices (US$)(4)	21,500		21,200		21,800		21,800		22,800
Systemwide revenue per U.S. office(4)(5)	$	100,968	$	98,840	$	101,548	$	95,162	$	83,998
Systemwide revenue per Canadian office (CN$)(4)(5)	112,992		104,580		101,931		90,875		89,922
Systemwide revenue per Canadian office (US$)(4)(5)	84,646		80,916		84,170		82,890		88,372
Net average fee per U.S. tax return filed(5)	$	233	$	228	$	217	$	210	$	198
Net average fee per Canadian tax return filed (CN$)(5)	80		83		78		77		75
Net average fee per Canadian tax return filed (US$)(5)	60		64		64		70		73

______________________________________________________________________________

(1) Adjusted EBITDA is a non-GAAP financial measure, which we define as net income plus provision for income taxes, interest expense, certain other adjustments, depreciation, amortization, and impairment charges. Please see "Adjusted EBITDA" below for more information and for a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure calculated and presented in accordance with GAAP.

(2) The calculation of the average number of offices per franchisee excludes Company-owned offices.

(3) Previously reported online return counts for fiscal years prior to 2015 have been restated to reflect accepted e-files only. No changes were made to previously reported returns for office counts.

(4) Our systemwide revenue represents the total tax preparation revenue generated by our franchised and Company-owned offices. It does not represent our revenue because our franchise royalties are derived from the operations of our franchisees. Because we maintain an infrastructure to support systemwide operations, we consider growth in systemwide revenue to be an important measurement.

(5) Systemwide revenue per office and the net average fee per tax return filed reflect amounts for our franchised and Company-owned offices.

Adjusted EBITDA

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To provide additional information regarding our financial results, we have disclosed in the table above and within this annual report Adjusted EBITDA. Adjusted EBITDA represents net income, before income taxes, interest expense, depreciation and amortization, and certain other items specified below. We have provided a reconciliation below of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure.

We have included Adjusted EBITDA in this annual report because we seek to manage our business to achieve higher levels of Adjusted EBITDA and to improve the level of Adjusted EBITDA as a percentage of revenue. In addition, it is a key basis upon which we assess the performance of our operations and management. We also use Adjusted EBITDA for business planning and the evaluation of acquisition opportunities. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons. We believe the presentation of Adjusted EBITDA enhances an overall understanding of the financial performance of and prospects for our business. Adjusted EBITDA is not a recognized financial measure under GAAP and may not be comparable to similarly titled measures used by other companies in our industry. Adjusted EBITDA should not be considered in isolation from or as an alternative to net income, operating income (loss), or any other performance measures derived in accordance with GAAP.

The following table presents a reconciliation of Adjusted EBITDA for each of the periods indicated.

	Fiscal Years Ended April 30,
	2017			2016		2015		2014			2013
	(dollars in thousands)
Reconciliation of Net Income to Adjusted EBITDA:
Net income	$	13,013		$	19,420	$	8,690	$	21,982		$	17,627
Interest expense	2,557			2,039		1,889		1,355			2,039
Income tax expense	7,754			11,058		4,811		13,654			11,170
Depreciation, amortization, and impairment charges	14,356			10,026		9,900		9,277			6,538
Impairment of online software and acquired customer lists	—			—		8,392		—			—
Net gain on available-for-sale securities	(50		)	—		—		(2,183		)	—
Executive severance	877			413		1,488		614			—
Restatement costs	—			—		—		907			—
Restructuring charge	—			—		—		—			425
Accrued judgments and settlements, net of estimated recoveries	2,700			—		7,617		—			—
Compliance Task Force and related costs	1,197			252		—		—			—
Stock-based compensation expense (income) related to liability classified awards	—			—		—		(872		)	2,625
Adjusted EBITDA	$	42,404		$	43,208	$	42,787	$	44,734		$	40,424

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Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations.

Overview

We are one of the leading providers of tax preparation services in the United States and Canada. Our tax preparation services and related tax settlement products are offered primarily through franchised locations, although we operate a limited number of Company-owned offices each tax season.

Our revenue primarily consists of the following components:

• Franchise Fees: Our standard franchise fee per territory is $40,000, and we offer our franchisees flexible structures and financing options for franchise fees. Franchise fee revenue is recognized when our obligations to prepare the franchisee for operation are substantially complete and as cash is received.

• AD Fees: Our fees for AD areas vary based on our assessment of the revenue potential of each AD area, and also depend on the performance of any existing franchisees within the AD area being sold. Our ADs generally receive 50% of franchise fees, royalties, and a portion of the interest income derived from territories located in their area. AD fees received are recognized as revenue on a straight-line basis over the initial contract term of each AD agreement, with the cumulative amount of revenue recognized not to exceed the amount of cash received.

• Royalties: Our franchise agreements require franchisees to pay us a base royalty typically equal to 14% of the franchisee's tax preparation revenue, subject to certain specified minimums.

• Advertising Fees: Our franchise agreements require all franchisees to pay us an advertising fee of 5% of the franchisee's tax preparation revenue, which we use primarily to fund collective advertising efforts.

• Financial Products: We offer two types of tax settlement financial products: refund transfer products, which involve providing a means by which a customer may receive his or her refund more quickly and conveniently, and refund-based loans. We earn fees from the arranging of the sale of these financial products.

• Interest Income: We earn interest income from our franchisees and ADs related to both indebtedness for the unpaid portions of their franchise and AD fees, and for other loans we extend to our franchisees related to the operation of their territories. We also earn interest on our accounts receivable.

• Assisted Tax Preparation Fees: We earn tax preparation fees, net of discounts, directly from both the operation of Company-owned offices in the U.S. and Canada.

For purposes of this section and throughout this annual report, all references to "fiscal 2017," "fiscal 2016," and "fiscal 2015" refer to our fiscal years ended April 30, 2017, 2016, and 2015, respectively. For purposes of this section and throughout this annual report, all references to "year" or "years" are the respective fiscal year or years ended April 30 unless otherwise noted in this annual report, and all references to "tax season" refer to the period between January 1 and April 30 of the referenced year.

In evaluating our performance, management focuses on several metrics that we believe are key to our success:

• Net growth in permanent office locations. The change in permanent office locations from year to year is a function of the opening of new offices, offset by locations that our franchisees or we close. Opening new permanent offices can be accomplished by the sale of new territories or the opening of permanent offices in previously sold territories. As a result of a reduction in new territory sales, the closure of under-performing offices, as well as the termination of the franchise agreements with several large franchisees, the Company and its franchisees operated 250 less permanent locations during the 2017 tax season compared to 2016. In fiscal 2016, on a net basis, the company and our franchisees operated 196 more permanent offices in the U.S. compared to fiscal 2015.

We utilize our AD program to focus on areas with large underdeveloped groups of territories we believe would benefit from the dedicated sales attention that an AD brings to our franchise sales process. Although we intend to grow our franchise network through the sale of new AD areas, opportunities often arise to acquire underperforming AD areas or AD areas in mature markets at favorable terms, offering us better future profitability from the associated franchise locations.

• Continued growth of SiempreTax+ brand. During fiscal 2015, we successfully launched our second brand, SiempreTax+. Given the demographic trends in the United States and the growing consumer purchasing power of the Hispanic community, we believe serving the Hispanic community through a separate brand that engages with customers in their preferred language and provides ancillary services unique to their needs presents a significant

35

office growth opportunity. For this reason, our ability to grow this brand further should substantially contribute to our future ability to meet our growth goals.

• Number of returns prepared. We strive to provide our franchisees with the resources and training needed to grow their own revenue, which is primarily driven by the number of returns prepared. We and our franchisees prepared a total of approximately 1.7 million returns in our U.S. offices in fiscal 2017, which was a decrease of 9.6% from fiscal 2016. Our new retail offices typically experience their most rapid growth during the first five years as they develop customer loyalty, operational experience and a referral base within their community. The seasoning of our U.S. offices shown in the following table highlights the relatively young age of our offices, with 1,202 of 3,823 offices that were in operation for five or fewer years, including the 2017 tax season.

	Tax Season 2017 Office Age in Years
	1	2	3	4	5	6+	Total
United States:
Franchised permanent	139	264	228	172	203	2,422	3,428
Franchised seasonal	6	5	2	3	2	14	32
Total U.S. franchised offices	145	269	230	175	205	2,436	3,460
Company-owned permanent	16	57	15	5	14	175	282
Company-owned seasonal	29	5	—	—	—	1	35
Total U.S. Company-owned offices	45	62	15	5	14	176	317
Processing centers	7	15	9	4	2	9	46
Total U.S. offices	197	346	254	184	221	2,621	3,823
Canada:
Franchised permanent	5	15	7	8	18	131	184
Franchised seasonal	1	1	—	1	1	22	26
Total Canadian franchised offices	6	16	7	9	19	153	210
Company-owned permanent	—	1	1	—	1	35	38
Company-owned seasonal	—	—	1	—	—	5	6
Total Canadian Company-owned offices	—	1	2	—	1	40	44
Total Canadian offices	6	17	9	9	20	193	254
Total offices	203	363	263	193	241	2,814	4,077

• Growth in systemwide revenue. Systemwide revenue, which is an operating measure not in accordance with GAAP, includes sales by both Company-owned and franchised offices. We believe systemwide revenue data is useful in assessing consumer demand for our services and products, the overall success of the Liberty Tax brand and, ultimately, the performance of the Company. Our royalty revenue is computed as a percentage of sales made by our franchised offices, less certain deductions. Accordingly, sales by our franchisees have a direct effect on the Company's royalty revenue and profitability. In addition, our systemwide revenue reflects the size of the Liberty Tax system, and because the size of our franchise system drives our management and infrastructure needs, systemwide revenue data helps us assess those needs in comparison to other companies in our industry and other franchise operators.

Our systemwide revenue in the U.S. decreased by 7.6% from fiscal 2016 to 2017 and grew 1.1% from fiscal 2015 to fiscal 2016. We experienced a 2.2% increase in average net fee per return filed in the U.S. from $228 in fiscal 2016 to $233 in fiscal 2017 and a decrease of 9.6% in number of tax returns filed in the U.S. processed from 1,832,000 in fiscal 2016 to 1,657,000 in fiscal 2017.

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• Tax settlement products obtained by U.S. customers. The total percentage of our U.S. customers obtaining a refund transfer product decreased to 47.6% during fiscal 2017 compared to 49.2% during fiscal 2016. As we have demonstrated our ability to offer products through JTH Financial, we have been successful in obtaining more favorable terms from outside vendors. Each year we analyze available tax settlement product solutions to balance risk and maximize profit per product.

Results of Operations

Fiscal year 2017 compared to fiscal year 2016

Revenues. The table below sets forth the components and changes in our revenue for the years ended April 30, 2017 and 2016.

	Fiscal Years Ended April 30,
					Change
	2017		2016		$			%
	(dollars in thousands)
Franchise fees	$	2,659	$	5,038	$	(2,379	)	(47	)%
Area Developers fees	4,177		6,008		(1,831		)	(30	)%
Royalties and advertising fees	74,291		80,274		(5,983		)	(7	)%
Financial products	51,829		45,327		6,502			14	%
Interest income	12,955		13,578		(623		)	(5	)%
Assisted tax preparation fees, net of discounts	21,600		15,775		5,825			37	%
Other	6,474		7,429		(955		)	(13	)%
Total revenue	$	173,985	$	173,429	$	556		—	%

Our total revenue increased by $0.6 million, or 0%, in fiscal 2017 over fiscal 2016. This increase was primarily due to:

• a $6.5 million increase in financial products, due primarily to an increase in the volume and price of refund advance loans originated and increased pricing on our refund transfer product. These increases were partially offset by a decrease in the number of customers who obtained a refund transfer product; and

• a $5.8 million increase in assisted tax preparation fees driven by an increase in the number of Company-owned offices in fiscal 2017 as compared to fiscal 2016 as well as increased pricing. In fiscal 2017 we operated 362 Company-owned offices compared to 310 in fiscal 2016.

These increases were offset by:

• a reduction of $6.0 million in royalty and advertising fees related to a decrease in the number of tax returns processed by our franchisees;

• a decline in franchise fees of $2.4 million as a result of fewer new territory sales and lower cash payments on notes from our franchisees in fiscal 2017. Franchise fee revenue is recognized when our obligations to prepare the franchisee for operations are substantially complete and as cash is received;

• a decrease of $1.8 million in AD fees as a result of prior year sales that have now been fully recognized over the life of the original agreements; and

• a decrease in other revenue of $1.0 million due to a reduction in the number of tax returns processed in our online “DIY” business and less transfer fees resulting from fewer sales transactions among franchisees.

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Operating expenses. The following table details the amounts and changes in our operating expenses in and from fiscal 2017 and fiscal 2016.

	Fiscal Years Ended April 30,
					Change
	2017		2016		$			%
	(dollars in thousands)
Employee compensation and benefits	$	44,615	$	42,882	$	1,733		4	%
Other costs and expenses	58,159		43,927		14,232			32	%
Area Developers expense	22,461		27,686		(5,225		)	(19	)%
Advertising expense	11,073		16,420		(5,347		)	(33	)%
Depreciation, amortization, and impairment charges	14,356		10,026		4,330			43	%
Total operating expenses	$	150,664	$	140,941	$	9,723		7	%

Total operating expenses increased $9.7 million, or 7%, in fiscal 2017 compared to fiscal 2016. The increase was attributable to:

A $14.2 million increase in other costs and expenses in fiscal 2017 compared to fiscal 2016, primarily due to:

• a $5.3 million increase in the costs associated with our refund advance product;

• a $3.1 million increase in costs related to an increase in the number of U.S. Company-owned offices operated in fiscal 2017;

• an increase of $2.9 million in bad debt expense and;

• a $2.7 million charge, in fiscal 2017, recorded which relates to an accrued judgment where the Company intends to vigorously defend our position and pursue an appeal.

• An increase in depreciation, amortization, and impairment charges of $4.3 million primarily due to an impairment charge driven by a decrease in the performance of our Company-owned stores.

• An increase in employee compensation and benefits of $1.7 million resulting from an increase in executive severance of $0.5 million as well as an increase in the compensation related to operating a greater number of Company-owned stores.

These increases were partially offset by:

• a $5.3 million decrease in advertising expense related to a reduction in the number of tax returns filed by our franchisees as well as better expense management and;

• a decrease of $5.2 million in AD expense resulting from a decrease in the number of tax returns filed and the associated decline in royalty fees along with the Company’s acquisition of several Area Developer rights during fiscal 2017, which lowered the number of offices located within an Area Developer’s territory. 

Income Taxes. The following table sets forth certain information regarding our income taxes for the fiscal years ended April 30, 2017 and 2016.

	Fiscal Years Ended April 30,
							Change
	2017			2016			$			%
	(dollars in thousands)
Income before income taxes	$	20,767		$	30,478		$	(9,711	)	(32	)%
Income tax expense	7,754			11,058			(3,304		)	(30	)%
Effective tax rate	37.3		%	36.3		%

The decrease in our income tax expense from fiscal 2016 to fiscal 2017 relates primarily to the decrease in our income before income taxes.

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Net income. Our net income decreased by 33% in fiscal 2017 over fiscal 2016, due primarily as a result of higher operating expenses as noted above.

Fiscal year 2016 compared to fiscal year 2015

Revenues. The table below sets forth the components and changes in our revenue for the years ended April 30, 2016 and 2015.

	Fiscal Years Ended April 30,
					Change
	2016		2015		$			%
	(dollars in thousands)
Franchise fees	$	5,038	$	6,246	$	(1,208	)	(19	)%
Area Developers fees	6,008		6,901		(893		)	(13	)%
Royalties and advertising fees	80,274		80,469		(195		)	—	%
Financial products	45,327		37,058		8,269			22	%
Interest income	13,578		14,707		(1,129		)	(8	)%
Assisted tax preparation fees, net of discounts	15,775		9,947		5,828			59	%
Other	7,429		6,844		585			9	%
Total revenue	$	173,429	$	162,172	$	11,257		7	%

Our total revenue increased by $11.3 million, or 6.9%, in fiscal 2016 over fiscal 2015. This increase was primarily due to the following:

• A $8.3 million increase in financial products, due primarily to the success of our new refund-based advance product, improved pricing and our decision to process 100% of our refund transfers through JTH Financial this year, which allows us to recognize the full amount charged to the customer as revenue.

• A $5.8 million increase in assisted tax preparation fees driven by an increase in the number of Company-owned offices in fiscal 2016 as compared to fiscal 2015. In fiscal 2016 we operated 310 Company-owned offices compared to 182 in fiscal 2015.

• Offset by a $1.2 million decrease in franchise fees primarily attributable to receiving lower cash down payments and lower cash payments on notes from our franchisees in fiscal 2016. Franchise fee revenue is recognized when our obligations to prepare the franchisee for operations are substantially complete and as cash is received.

Operating expenses. The following table details the amounts and changes in our operating expenses in and from fiscal 2016 and fiscal 2015.

	Fiscal Years Ended April 30,
					Change
	2016		2015		$			%
	(dollars in thousands)
Employee compensation and benefits	$	42,882	$	41,079	$	1,803		4	%
Other costs and expenses	43,927		40,604		3,323			8	%
Area Developers expense	27,686		28,497		(811		)	(3	)%
Advertising expense	16,420		18,308		(1,888		)	(10	)%
Depreciation, amortization, and impairment charges	10,026		9,900		126			1	%
Impairment of online software and acquired customer lists	—		8,392		(8,392		)	N/A
Total operating expenses	$	140,941	$	146,780	$	(5,839	)	(4	)%

Our total operating expenses decreased by $5.8 million, or 4%, in fiscal 2016 compared to fiscal 2015. The decrease was attributable to:

• A decrease of $8.4 million due to the impairment of our online software and acquired customer lists related to our online business recorded in fiscal 2015 that did not recur in fiscal 2016.

• A $1.9 million decrease in advertising expense related to a $0.8 million decrease in on-line advertising and a $1.1 million decrease in new franchise advertising.

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The decreases were partially offset by at $3.3 million increase in other costs and expenses during fiscal 2016 over fiscal 2015, caused primarily by:

• An increase of $4.1 million in bank fees due to costs associated with our new refund-based advance product.

• An increase of $2.9 million in occupancy costs related to an increase in the number of Company-owned offices operating in fiscal 2016 including rent related to future rent payments on closed offices.

• An increase of $1.6 million in bad debt expense due to an increase in receivables.

• A decrease related to the settlement expenses of our class action litigation cases of $7.6 million, net of estimated recoveries, in fiscal 2015 that did not recur in fiscal 2016.

Income Taxes. The following table sets forth certain information regarding our income taxes for the fiscal years ended April 30, 2016 and 2015.

	Fiscal Years Ended April 30,
							Change
	2016			2015			$		%
	(dollars in thousands)
Income before income taxes	$	30,478		$	13,501		$	16,977	126	%
Income tax expense	11,058			4,811			6,247		130	%
Effective tax rate	36.3		%	35.6		%

The increase in our income tax expense from fiscal 2015 to fiscal 2016 relates primarily to the increase in our income before income taxes.

Net income. Our net income increased by 123% in fiscal 2016 over fiscal 2015, primarily as a result of lower operating expenses caused by an $8.4 million impairment charge related to our online software and acquired customer lists in fiscal 2015, and $7.6 million in tentative settlements of our class action litigation cases, net of estimated recoveries, both which occurred in fiscal 2015 that did not recur in fiscal 2016, along with an increase in financial product margin.

Liquidity and Capital Resources

Overview of factors affecting our liquidity

Seasonality of cash flow. Our tax return preparation business is seasonal, and most of our revenues and cash flow are generated during the period from late January through April 30. Following each tax season, from May 1 through late January of the following year, we rely significantly on excess operating cash flow from the previous season, from cash payments made by franchisees and ADs who purchase new territories and areas prior to the next tax season, and on the use of our credit facility to fund our operating expenses and invest in the future growth of our business. Our business has historically generated a strong cash flow from operations on an annual basis. We devote a significant portion of our cash resources during the off season to finance the working capital needs of our franchisees, and expenditures for property, equipment and software.

Credit facility. Our amended credit facility consists of a $21.2 million term loan and a revolving credit facility that currently allows borrowing of up to $203.8 million with an accordion feature that permits the Company to request an increase in availability of up to an additional $50.0 million. Outstanding borrowings accrue interest, which is paid monthly, at a rate of the one-month London Interbank Offered Rate ("LIBOR") plus a margin ranging from 1.50% to 2.25% depending on the Company's leverage ratio. At April 30, 2017 and 2016, the interest rate was 2.73% and 2.06%, respectively, and the average interest rate paid during the fiscal year ended April 30, 2017 was 2.31%. A commitment fee that varies from 0.25% to 0.50% depending on the Company's leverage ratio on the unused portion of the credit facility is paid monthly. The indebtedness is collateralized by substantially all the assets of the Company and both loans mature on April 30, 2019 (except as to the commitments of one lender under the revolving credit facility, which mature on September 30, 2017).

Under our credit facility, we are subject to a number of covenants that could potentially restrict how we carry out our business, or that require us to meet certain periodic tests in the form of financial covenants. The restrictions we consider to be material to our ongoing business include the following:

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• We must satisfy a "leverage ratio" test that is based on our outstanding indebtedness at the end of each fiscal quarter.

• We must satisfy a "fixed charge coverage ratio" test at the end of each fiscal quarter.

• We must reduce the outstanding balance under our revolving loan to zero for a period of at least 45 consecutive days each fiscal year.

• We must also maintain a minimum net worth requirement, measured at April 30 of each year.

In addition, were we to experience certain types of changes in control affecting Mr. Hewitt's continuing control of us, or certain changes to the composition of our Board of Directors, we might become subject to an event of default under our credit facility, which could result in the acceleration of our obligations under that facility.

Our credit facility also contains customary affirmative and negative covenants, including limitations on indebtedness, limitations on liens and negative pledges, limitations on investments, loans and acquisitions, limitations on mergers, consolidations, liquidations and dissolutions, limitations on sales of assets, limitations on certain restricted payments and limitations on transactions with affiliates, among others.

Franchisee lending and potential exposure to credit loss. A substantial portion of our cash flow during the year is utilized to provide funding to our franchisees. At April 30, 2017, our total balance of loans to franchisees for working capital and equipment loans, representing cash we had advanced to the franchisees, was $14.6 million. In addition, at that date, our franchisees and ADs together owed us an additional $88.1 million, net of unrecognized revenue of $29.4 million, representing unpaid royalties, the unpaid purchase price for franchise territories and other amounts.

Our actual exposure to potential credit loss associated with franchisee loans is less than the aggregate amount of those loans because a significant portion of those loans are to franchisees located within AD areas, where our AD is ultimately entitled to a substantial portion of the franchise fee and royalty revenues represented by some of these loans. For this reason, the amount of indebtedness of franchisees to us is effectively offset in part by our related payable obligation to ADs in respect of franchise fees and royalties. As of April 30, 2017, the total indebtedness of franchisees to us where the franchisee is located in an AD area was $45.8 million but $23.1 million of that total indebtedness represents amounts ultimately payable to ADs as their share of franchise fees and royalties.

Our franchisees make electronic return filings for their customers utilizing our facilities. Our franchise agreements allow us to obtain repayment of amounts due to us from our franchisees through an electronic fee intercept program before our franchisees receive the net proceeds from tax preparation and other fees they have charged to their customers on tax returns associated with tax settlement products. Therefore, we are able to minimize the nonpayment risk associated with amounts outstanding from franchisees by obtaining direct electronic payment in the ordinary course throughout the tax season. Our credit risk associated with amounts outstanding to ADs is also mitigated by our electronic fee intercept program, which enables us to obtain repayments of amounts that would otherwise flow through to ADs as their share of franchise fee and royalty payments, to the extent of an AD's indebtedness to us.

The unpaid amounts owed to us from our franchisees and ADs are collateralized by the underlying franchise or area and, when the franchise or area owner is an entity, are generally guaranteed by the owners of the respective entity. Accordingly, to the extent a franchisee or AD does not satisfy its payment obligations to us, we may repossess the underlying franchise or area in order to resell it in the future. At April 30, 2017, we had an investment in impaired accounts and notes receivable and related interest receivable of approximately $26.0 million. We consider accounts and notes receivable to be impaired if the amounts due exceed the fair value of the underlying franchise and estimate an allowance for doubtful accounts based on that excess. Amounts due include the recorded value of the accounts and notes receivable reduced by the allowance for uncollected interest, amounts due to ADs for their portion of franchisee receivables, any related unrecognized revenue and amounts owed to the franchisee or AD by us. In establishing the fair value of the underlying franchise, we consider net fees of open territories and the number of unopened territories. At April 30, 2017, our allowance for doubtful accounts for impaired accounts and notes receivable was $9.5 million. There were no significant concentrations of credit risk with any individual franchisee or AD as of April 30, 2017, and we believe that our allowance for doubtful accounts as of April 30, 2017 is adequate for our existing loss exposure. We closely monitor the performance of our franchisees and ADs, and will adjust our allowances as appropriate if we determine that the existing allowances are inadequate to cover estimated losses.

Dividends. See "Item 5—Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities."

Sources and uses of cash

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Operating activities

In fiscal 2017, our cash provided from operating activities increased $2.6 million from the cash provided in fiscal 2016. This increase was driven by:

• An $8.3 million decrease in payments related to the class action litigation cases paid in fiscal 2016 that did not recur in fiscal 2017, partially offset by;

• An increase in cash tax payments of $4.0 million in fiscal 2017 compared to fiscal 2016.

In fiscal 2016, our cash provided from operating activities increased $5.3 million from cash provided in fiscal 2015. This increase was driven by:

• A $10.1 million decrease in cash tax payments in fiscal 2016 compared to fiscal 2015.

• A $3.9 million increase in income taxes payable, resulting from less excess tax benefits recognized during the year for stock option exercises. There was a corresponding decrease in cash flows from financing activities as a result of such excess tax benefits, offset by an $8.3 million increase in payments related to the settlement of our class action litigation cases.

• Offset by higher revenues with only a slight increase in collections from franchisees and the payments of certain expenses that were delayed into fiscal 2016 from fiscal 2015.

Investing activities

In fiscal 2017, we used $16.1 million less in investing activities than in fiscal 2016 due to:

• A $7.2 million decrease in net cash used in operating loans to franchisees resulting from an decrease in lending of $7.4 million as well as better collections of operating loans.

• A $10.0 million decrease in net cash used resulting from the sale of available-for-sale securities during fiscal 2017 and the purchase of those securities in fiscal 2016 and;

• a $5.7 million decrease in net cash used resulting primarily from lower development costs associated with internal use software, offset by;

• a $5.7 million increase in net cash used to acquire Company-owned offices, Area Developer rights and customer lists, net of sales.

In fiscal 2016, we used $8.7 million more in investing activities than in fiscal 2015 due to:

• A $7.2 million increase in net cash used in operating loans to franchisees resulting from an increase in lending of $8.2 million with only a slight increase in payments received from franchisees and an increase in loans applied in the acquisition of certain assets from franchisees.

• A $5.0 million purchase of available-for-sale securities.

• Offset by, a $2.7 million decrease in payments for purchases of Company-owned offices and AD rights, net of sales.

Financing activities

In fiscal 2017, we used $0.6 million more cash for financing activities compared to fiscal 2016 largely due to decrease of $2.3 million in cash received for stock option exercises, partially offset by a $1.6 million decrease in cash paid for the repurchase of common stock.

In fiscal 2016, we used $16.7 million less cash for financing activities compared to fiscal 2015 largely due to:

• A $24.6 million decrease in cash used for common stock repurchases, net of proceeds from stock option exercises; offset by,

• A $6.6 million increase in dividends paid in fiscal 2016. In fiscal 2016 we paid four quarterly dividends compared to one quarterly dividend in fiscal 2015, and

• A $3.9 million decrease in the tax benefit of stock options exercises.

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Future cash needs and capital requirements

Operating cash flow needs. We believe that our credit facility entered into on April 30, 2012 as amended, will be sufficient to support our cash flow needs for the foreseeable future.

The maximum balance of our revolving credit facility during fiscal 2017 was $142.5 million on February 6, 2017. By April 25, 2017, we paid the entire balance of our revolving credit facility. At April 30, 2017, using the leverage ratio applicable under our loan covenants. Our maximum unused borrowing capacity was $108.0 million.

Our credit facility also contains a requirement that we reduce the balance of our revolving loan to zero for a period of at least 45 consecutive days each fiscal year. However, because our term loan will remain outstanding during that 45 day period, and given our historic cash flow experience at the beginning and end of each fiscal year, we do not anticipate that the unavailability of our revolving loan during that 45 day period each fiscal year will adversely affect our cash flow. As of June 14, 2017, we had maintained a zero balance on our revolver for the required 45 days and thus have already met the requirement for fiscal 2018.

Several factors could affect our cash flow in future periods, including the following:

• A continued delay by the IRS until at least mid-February to issue refunds to taxpayers who claim the Earned Income Tax Credit or the Child Tax Credit.

• The extent to which we extend additional operating financing to our franchisees and ADs, beyond the levels of prior periods.

• The extent and timing of capital expenditures.

• The cash flow effect of stock option exercises and the extent to which we engage in stock repurchases.

• Our ability to generate fee and other income related to tax settlement products in light of regulatory pressures on us and our business partners.

• The extent to which we repurchase AD areas, which will involve the use of cash in the short-term, but improve cash receipts in future periods from what would have been the AD's share of royalties and franchise fees.

• The extent, if any, to which our Board of Directors elects to continue to declare dividends on our common stock.

Effect of our credit facility covenants on our future performance. Our credit facility, which matures on April 30, 2019, imposes several restrictive covenants, including a covenant that requires us to maintain a "leverage ratio" of not more than 5.5:1 at the end of each fiscal quarter ending January 31 and a ratio of not more than 3:1 at the end of each other fiscal quarter. The higher permitted leverage ratio at the end of the January 31 quarter reflects the fact that as of that date, we have typically extended significant credit to our franchisees for working capital and other needs that is not reflected in revenue that we receive from our franchisees until the period beginning in February each year. At January 31, 2017 and April 30, 2017, we had a leverage ratio of 3.8:1 and 0.59:1, respectively.

Our leverage ratio at April 30, 2017 reflected the fact that we had no balance outstanding on our revolving credit facility at that date and a $17.5 million balance under our term loan. The leverage ratio is measured only at the end of each fiscal quarter, and so there may be times at which we exceed the quarter-end leverage ratio during the quarter, which we are permitted to do provided that our leverage ratio is within the allowable ratio at quarter-end.

We continue to be obligated under our credit facility to satisfy a fixed charge coverage ratio test which requires that ratio to be not less than 1.50:1 at the end of every fiscal quarter. At January 31, 2017 and April 30, 2017, our fixed charge coverage ratios were 3.70:1 and 4.42:1, respectively.

We were in compliance with the ratio tests described in this section as of April 30, 2017. We expect to be able to manage our cash flow and our operating activities in such a manner that we will continue to be able to satisfy our obligations under the credit facility for the remainder of the term of that facility.

Seasonality of Operations

Given the seasonal nature of the tax return preparation business, we have historically generated and expect to continue to generate most of our revenues during the period from January 1 through April 30. For example, in fiscal 2017 and fiscal 2016, we earned 28% and 31% of our revenues during our fiscal third quarter ended January 31, respectively, and 92% and 91% of our revenues during the combined fiscal third and fourth quarters, respectively. We historically

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operate at a loss through the first eight months of each fiscal year, during which we incur costs associated with preparing for the upcoming tax season.

Off Balance Sheet Arrangements

From time to time, we have been party to interest rate swap agreements. These swaps effectively changed the variable-rate of our credit facility into a fixed rate credit facility. Under the swaps, we received a variable interest rate based on the one month LIBOR and paid a fixed interest rate. We entered into an interest rate swap agreement in relation to our mortgage payable to a bank, during fiscal 2017. We had no outstanding swap agreement at April 30, 2016. See "Note 8. Derivative Instruments and Hedging Activities" for more information.

We also enter into forward contracts to eliminate exposure related to foreign currency fluctuations in connection with the short-term advances we make to our Canadian subsidiary in order to fund personal income tax refund discounting for our Canadian operations. At April 30, 2017 and 2016, there were no forward contracts outstanding, but we expect to enter into forward contracts in the future during the Canadian tax season.

Commitments and Contingencies

The following table sets forth certain of our contractual obligations as of April 30, 2017.

	Contractual Obligations
	Total		Less than 1 Year		1 - 3 Years		3 - 5 Years		More than 5 Years
	(dollars in thousands)
Long-term debt obligations(1)	$	27,528	$	8,231	$	17,153	$	414	$	1,730
Operating lease obligations(2)	21,382		9,518		9,340		2,261		263
Purchase obligations(3)	9,267		6,618		2,649		—		—
Net lease payments on closed offices	613		485		128		—		—
Total contractual obligations	$	58,790	$	24,852	$	29,270	$	2,675	$	1,993

(1) Amounts include mandatory principal payments on long-term debt as well as estimated interest of $493, $472, $138, and $226 for less than 1 year, 1-3 years, 3-5 years, and more than 5 years, respectively. Interest calculated for future periods was based on the interest rate at April 30, 2017. The actual interest rate will vary based on LIBOR and our leverage ratio.

(2) We sublease most of the office spaces represented by this line item and anticipate sublease receipts from franchisees of $4,352, $4,518, $1,070, and $150 for less than 1 year, 1-3 years, 3-5 years, and more than 5 years, respectively.

(3) Amounts are primarily for advertising expense and for software licenses, maintenance, and development.

Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles. The following critical accounting policies may affect reported results.

Revenue Recognition. We recognize franchise fees when our obligations to prepare the franchise for operation have been substantially completed and cash has been received. To the extent we finance sales of franchises, we collect those fees for a period of up to five years.

AD rights have historically been granted for a term of ten years. We have changed future terms of new and renewal AD contracts to six years. AD fees are recognized as revenue on a straight-line basis over the initial contract term of each AD agreement with the cumulative amount of revenue recognized not to exceed the amount of cash received. Amounts due to ADs for their services under an area development agreement are expensed as the related franchise fees and royalty revenues are recognized.

Royalties and advertising fees are recognized as franchise territories generate sales.

Tax return preparation fees and financial products revenue are recognized as revenue in the period the related tax return is filed for the customer. Discounts for promotional programs are recorded at the time the return is filed and are recorded as reductions to revenues.

Interest income on notes receivable is recognized based on the outstanding principal note balance less unrecognized revenue unless it is put on non-accrual status. Interest income on the unrecognized revenue portion of notes receivable is recognized when received. For accounts receivable, interest income is recognized based on the outstanding receivable balance over 30 days old, net of an allowance.

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Gains on sales of Company-owned offices are recognized when cash is received. Losses on sales of Company-owned offices are recognized immediately.

Long-Lived Assets. We review our long-lived assets, such as property, plant and equipment, and purchased intangibles subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. We measure recoverability by comparison of the carrying value of an asset to its estimated undiscounted future cash flows expected to be generated by the asset. We recognize and measure potential impairment at the lowest level where cash flows are individually identifiable. If the carrying amount of an asset exceeds its estimated future cash flows, we recognize an impairment charge equal to the amount by which the carrying value of the asset exceeds the fair value of the asset. We determine fair value through various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals. If assets are to be disposed of, we separately present these assets in the balance sheet and report them at the lower of the carrying amount or fair value less selling costs, and no longer depreciate them. When we have assets classified as held for sale, we present them separately in the appropriate asset section of the balance sheet.

Allowance for Doubtful Accounts. Our allowance for doubtful accounts represents our best estimate of the amount of probable credit losses in our existing accounts receivable and notes receivable. Because the repayment of accounts receivable and notes receivable are dependent on the performance of the underlying franchises, at the end of each reporting period we estimate the amount of the allowance for uncollectible accounts based on a comparison of amounts due to the estimated fair value of the underlying franchise which collateralize such receivables.

Office Closing Costs. We provide for closed office liabilities on the basis of the present value of estimated remaining non-cancellable lease payments, net of estimated subtenant income. We estimate the net lease liability using a discount rate to calculate the present value of the remaining net rent payments on closed offices. We usually pay closed office lease liabilities over the lease terms associated with the closed offices, which generally have remaining terms ranging from one to seven years.

Stock Compensation Expense. For equity classified employee stock-based compensation, we record costs of our employee stock-based compensation based on the grant-date fair value of awards using the Black-Scholes-Merton option pricing model. For liability classified awards we record costs based on the fair value at the reporting date. We recognize compensation costs for an award that has a graded vesting schedule on a straight-line basis over the service period for the entire length of the stock option award.

Potential effect of JOBS Act. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We are an "emerging growth company" and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (i.e., not publicly traded) companies. We have elected the option to delay the adoption of new or revised accounting standards, and as a result, we may not elect to comply with new or revised accounting standards on the relevant dates on which adoption of those standards is required for non-emerging growth companies.

Critical Accounting Estimates

Our consolidated financial statements are prepared in accordance with GAAP. In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures. We base our assumptions, estimates, and judgments on historical experience, current trends, and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates, and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Our significant accounting policies are discussed in Note 1 of the Notes to our Consolidated Financial Statements. We believe that the following accounting estimates are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective, or complex judgments resulting from the need to make estimates about the effect of matters that are inherently uncertain. We have reviewed these critical accounting estimates and related disclosures with the Audit Committee of our Board of Directors.

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Description	Judgments and Uncertainties	Effect if Actual Results Differ From Assumptions
Allowance for doubtful accounts
We establish our allowance for doubtful accounts for our trade accounts receivable and notes receivable based on a comparison of the amount due to the estimated fair value of the underlying franchise. In establishing the fair value of the underlying franchise, management considers net fees of open offices and the number of unopened offices.	Our calculation of the allowance requires management to make assumptions regarding the fair value of the franchise to which the account relates.	A 10% decrease in the fair value of franchise territories at April 30, 2017 would have increased our allowance for doubtful accounts by approximately $1.8 million at that date.
Long-lived assets
Long-lived assets other than goodwill and indefinite-lived intangible assets, which are separately tested for impairment, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. When evaluating long-lived assets for potential impairment, we first compare the carrying value of the asset to the asset's estimated future cash flows (undiscounted and without interest charges). If the estimated future cash flows are less than the carrying value of the asset, we calculate an impairment loss. The impairment loss calculation compares the carrying value of the asset to the asset's estimated fair value, which may be based on estimated future cash flows (discounted and with interest charges). We recognize an impairment loss if the amount of the asset's carrying value exceeds the asset's estimated fair value. If we recognize an impairment loss, the adjusted carrying amount of the asset becomes its new cost basis. For a depreciable long-lived asset, the new cost basis will be depreciated (amortized) over the remaining useful life of that asset.	Our calculation of impairment, if any, requires management to make assumptions regarding the fair value of the long-lived asset.	We have not made any material changes in the accounting methodology we use to assess impairment loss during the past three fiscal years. We do not believe there is a reasonable likelihood that there will be a material change in the estimates or assumptions we use to calculate long-lived asset impairment losses. However, if actual results are not consistent with our estimates and assumptions used in estimating future cash flows and asset fair values, we may be exposed to losses that could be material. For AD rights, a 10% decrease in the estimated future cash flows would not result in any incremental loss. For assets acquired from franchisees, and held for sale, a 10% decrease in the fair value would increase our impairment by approximately $0.5 million.

Recently Issued Accounting Standards

Refer to "Note 1 - Description of Business and Summary of Significant Accounting Policies", in our consolidated financial statements.

Item 7A.    Quantitative and Qualitative Disclosures About Market Risk.

Foreign exchange risk

We are subject to inherent risks attributed to operating in more than one country. Most of our revenues, expenses, and borrowings are denominated in U.S. dollars. Our operations in Canada, including the advances we make to our Canadian subsidiary, are denominated in Canadian dollars, and are, therefore, subject to foreign currency fluctuations. For fiscal 2017, a 5% change in the exchange rate of the Canadian dollar relative to the U.S. dollar would have had less than a $0.1 million impact on our net income and a $0.5 million impact on our total assets at April 30, 2017. We use, and may continue to use in the future, derivative financial instruments, such as forward contracts, to manage foreign currency exchange rate risks. See

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"Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Off Balance Sheet Arrangements."

Interest rate risk

We are subject to interest rate risk in connection with our credit facility, which provides for borrowings of up to a total of $225.0 million and bears interest at variable rates. Assuming our revolving loan is fully drawn and including the full balance of our term loan, each eighth of a percentage point change in interest rates would result in a $0.3 million change in annual interest expense on our credit facility. From time to time, we have entered into hedging instruments involving the exchange of floating for fixed rate interest payments to reduce interest rate volatility. See "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Off Balance Sheet Arrangements."

Item 8.    Financial Statements and Supplementary Data.

Our financial statements and supplementary financial information required by this Item 8 are contained in this report in "Item 15. Exhibits and Financial Statements."

Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A.    Controls and Procedures.

The Company’s disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in the Company’s reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, including, without limitation, that such information is accumulated and communicated to Company management, including the Company’s principal executive and financial officer, as appropriate, to allow timely decisions regarding required disclosures.

Evaluation of Disclosure Controls and Procedures

The Company, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of April 30, 2017. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of April 30, 2017, the Company’s disclosure controls and procedures were effective in providing reasonable assurance that information required to be filed by the Company in the reports if files or submits under the Exchange Act is recorded, processed, summarized, and reported by management of the Company on a timely basis in order to comply with the Company’s disclosure obligations under the Exchange Act and the rules and regulations promulgated thereunder.

Management’s Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). The Company’s internal control over financial reporting is designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with GAAP.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of April 30, 2017. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control – Integrated Framework (2013). Based on this assessment, management believes that, as of April 30, 2017, the Company’s internal control over financial reporting was effective based on those criteria.

Changes in Internal Control over Financial Reporting

During the quarter ended April 30, 2017, there were no changes that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.    Other Information.

On June 14, 2017, the Company issued an earnings release announcing its unaudited financial results for the quarter and year ended April 30, 2017, and furnished a copy of the release as Exhibit 99.1 to the Company’s current report on Form 8-K

47

filed on the same date. The consolidated balance sheet as of April 30, 2017 in this Annual Report on Form 10-K corrects the amounts reported as "Deferred income tax assets" and “Deferred income tax liability” of $1,063 and $4,525, respectively, to $6,956 and $10,367, respectively.  See "Item 15. Exhibits and Financial Statements." The reason for the correction was the finalization of the accounting for a tax accounting method change made subsequent to the filing of the Company’s current report on Form 8-K, which has the impact of increasing the Company's deferred income tax asset and deferred income tax liability.

48

PART III

Item 10.    Directors, Executive Officers, and Corporate Governance.

The information required by this item will be provided by being incorporated herein by reference to the Company’s definitive proxy statement for the 2017 Annual Meeting of Stockholders.

Item 11.    Executive Compensation.

The information required by this item will be provided by being incorporated herein by reference to the Company’s definitive proxy statement for the 2017 Annual Meeting of Stockholders.

Item 12.    Security Ownership of Certain Beneficial Owners and Management And Related Stockholder Matters.

The information required by this item will be provided by being incorporated herein by reference to the Company’s definitive proxy statement for the 2017 Annual Meeting of Stockholders.

Item 13.    Certain Relationships and Related Transactions, and Director Independence.

The information required by this item will be provided by being incorporated herein by reference to the Company’s definitive proxy statement for the 2017 Annual Meeting of Stockholders.

Item 14.    Principal Accounting Fees and Services.

The information required by this item will be provided by being incorporated herein by reference to the Company’s definitive proxy statement for the 2017 Annual Meeting of Stockholders.

49

PART IV

Item 15.    Exhibits and Financial Statement Schedules.

(a) Financial Statements.

The following financial statements of the Company are included in Item 8 of this Annual Report on Form 10-K:

Audited Financial Statements for the Years Ended April 30, 2017, 2016, and 2015

	Page
Report of Independent Registered Public Accounting Firm		F-1
Consolidated Balance Sheets as of April 30, 2017 and 2016		F-2
Consolidated Statements of Income for the Years Ended April 30, 2017, 2016 and 2015		F-3
Consolidated Statements of Comprehensive Income for the Years Ended April 30, 2017, 2016 and 2015		F-4
Consolidated Statements of Stockholders' Equity for the Years Ended April 30, 2017, 2016 and 2015		F-5
Consolidated Statements of Cash Flows for the Years Ended April 30, 2017, 2016 and 2015		F-8
Notes to Consolidated Financial Statements		F-10

50

(b) Exhibits.

Exhibit Number	Exhibit Description
3.1	Amended and Restated Certificate of Incorporation of JTH Holding, Inc. (incorporated by reference to Exhibit 3.1 to Form S-1, File No. 333-176655 filed on September 2, 2011).
3.2	Certificate of Amendment to the Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to Form 8-K, File No. 001-35588 filed on July 15, 2014).
3.3	Second Amended and Restated Bylaws of Liberty Tax, Inc. (incorporated by reference to Exhibit 3.2 to Form 8-K, File No. 001-35588 filed on July 15, 2014).
4.1	Share Exchange Agreement among DataTax Business Services Limited, Liberty Tax Holding Corporation, Liberty Tax Service Inc. and JTH Tax, Inc. dated as of October 16, 2001 (incorporated by reference to Exhibit 4.3 to Form S-1, File No. 333-176655 filed on September 2, 2011).
4.2	Support Agreement between JTH Tax, Inc. and Liberty Tax Holding Corporation dated as of October 16, 2001 (incorporated by reference to Exhibit 4.4 to Form S-1, File No. 333-176655 filed on September 2, 2011).
4.3	Specimen Common Stock Certificate of Liberty Tax, Inc. (Incorporated by reference to Exhibit 4.6 to Form 8-K, File No. 001-35588 filed on September 3, 2014).
4.4	Form of Indenture with respect to Senior Debt Securities (incorporated by reference to Exhibit 4.2 to Form S-3, File No. 333-199579 filed on October 23, 2014).
4.5	Form of Indenture with respect to Subordinated Debt Securities (incorporated by reference to Exhibit 4.4 to Form S-3, File No. 333-199579 filed on October 23, 2014).
10.1#	JTH Holding, Inc. 2011 Equity and Cash Incentive Plan (incorporated by reference to Exhibit 10.1 to Amendment No. 3 to Form S-1, File No. 333-176655 filed on February 3, 2012).
10.2#	JTH Tax, Inc. Stock Option Plan dated as of May 1, 1998 (incorporated by reference to Exhibit 10.2 to Form S-1, File No. 333-176655 filed on September 2, 2011).
10.3#	Form of Stock Option Agreement under Stock Option Plan (incorporated by reference to Exhibit 10.3 to Form S-1, File No. 333-176655 filed on September 2, 2011).
10.4#	Form of Incentive Stock Option Agreement for Employees via JTH Holding, Inc. 2011 Equity and Cash Incentive Plan (incorporated by reference to Exhibit 10.7 to Amendment No. 5 to Form S-1, File No. 333-176655 filed on October 15, 2012).
10.5#	Form of Restricted Stock Unit Agreement for Employees via JTH Holding, Inc. 2011 Equity and Cash Incentive Plan (incorporated by reference to Exhibit 10.5 to Form 10-K, File No. 001-35588 filed on October 1, 2013).
10.6	Revolving Credit and Term Loan Agreement dated as of April 30, 2012 among JTH Holding, Inc. and SunTrust Bank (incorporated by reference to Exhibit 10.7 to Amendment No. 1 to Form 10, File No. 000-54660 filed on May 18, 2012).
10.7	Security Agreement among JTH Holding, Inc. and certain of its subsidiaries and SunTrust Bank dated as of April 30, 2012 (incorporated by reference to Exhibit 10.8 to Amendment No. 1 to Form 10, File No. 000-54660 filed on May 18, 2012).
10.8	Pledge Agreement among JTH Holding, Inc. and certain of its subsidiaries and SunTrust Bank dated as of April 30, 2012 (incorporated by reference to Exhibit 10.9 to Amendment No. 1 to Form 10, File No. 000-54660 filed on May 18, 2012).
10.9	Subsidiary Guaranty Agreement among certain subsidiaries of JTH Holding, Inc. and SunTrust Bank dated April 30, 2012 (incorporated by reference to Exhibit 10.10 to Amendment No. 1 to Form 10, File No. 000-54660 filed on May 18, 2012).
10.10	Waiver and Amendment to Revolving Credit and Term Loan Agreement dated as of December 19, 2012 among JTH Holding, Inc. and SunTrust Bank (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on December 26, 2012).
10.11	Supplement and Joinder Agreement dated as of December 28, 2012 among JTH Holding, Inc. and SunTrust Bank (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on December 28, 2012).
10.12	Waiver to Revolving Credit and Term Loan Agreement with SunTrust Bank as Administrative Agent (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on March 12, 2013).
10.13	Standstill Agreement between JTH Holding, Inc., SunTrust Bank and certain of JTH Holding, Inc.'s subsidiaries dated as of August 5, 2013 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on August 6, 2013).

51

Exhibit Number	Exhibit Description
10.14	Waiver to Revolving Credit and Term Loan Agreement with SunTrust Bank as Administrative Agent dated as of August 29, 2013 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on August 29, 2013).
10.15	Second Amendment to Revolving Credit and Term Loan Agreement dated October 3, 2014 (incorporated by reference to Exhibit 10.2 to Form 8-K, File No. 001-35588 filed on October 6, 2014).
10.16	Third Amendment to Revolving Credit and Term Loan Agreement dated as of September 2, 2015 among Liberty Tax, Inc. SunTrust Bank and other parties thereto (incorporated by reference to Exhibit 10.1 to Form 10-Q, File No. 001-35588 filed on September 3, 2015).
10.17	Fourth Amendment to Revolving Credit and Term Loan Agreement dated as of August 18, 2016 among Liberty Tax, Inc., SunTrust Bank and other parties thereto (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on August 24, 2016).
10.18	Supplement and Joinder Agreement dated October 3, 2014 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on October 6, 2014).
10.19	Form of Franchise Agreement for United States Franchisees (incorporated by reference to Exhibit 10.18 to Form 10-K, File No., 001-35588 filed on June 29, 2016).
10.20	Form of Area Developer Agreement for United States Area Developers (incorporated by reference to Exhibit 10.19 to Form 10-K, File No., 001-35588 filed on June 29, 2016).
10.21#	Employment Agreement for Kathleen Donovan dated February 1, 2014 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on January 24, 2014).
10.22#	Employment Agreement for Richard G. Artese dated May 1, 2014 (incorporated by reference to Exhibit 10.4 to Form 10-K, File No. 001-35588 filed on June 26, 2014).
10.23#	Employment Agreement for Michael S. Piper dated July 31, 2015 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No., 001-35588 filed on August 6, 2015).
10.24#	Employment Agreement for Vanessa M. Szajnoga dated November 23, 2015 (incorporated by reference to Exhibit 10.1 to Form 10-Q, File No., 001-35588 filed on December 9, 2015).
10.25#	Amended and Restated Employment Agreement for John T. Hewitt dated July 1, 2016 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on July 8, 2016).
10.26#	Employment Agreement for Edward L. Brunot dated April 30, 2017 (incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on May 25, 2017).
10.27#	Amendment to Employment Agreement for Vanessa M. Szajnoga dated June 1, 2017(incorporated by reference to Exhibit 10.1 to Form 8-K, File No. 001-35588 filed on June 7, 2017).
10.28#	Amendment to Employment Agreement for Michael S. Piper dated June 1, 2017(incorporated by reference to Exhibit 10.2 to Form 8-K, File No. 001-35588 filed on June 7, 2017).
21.1*	Subsidiaries of Liberty Tax, Inc.
23.1*	Consent of KPMG LLP
24.1*	Power of Attorney (included on signature page)
31.1**	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002
31.2**	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002
32.1**	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes Oxley Act of 2002
32.2**	Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes Oxley Act of 2002
101	The following materials from the Registrant's Annual Report on Form 10-K for the year ended April 30, 2017, are formatted in XBRL (eXtensible Business Reporting Language):(i) Consolidated Balance Sheets at April 30, 2017 and 2016, (ii) Consolidated Statements of Income for the years ended April 30, 2017, 2016 and 2015, (iii) Consolidated Statements of Comprehensive Income for the years ended April 30, 2017, 2016 and 2015, (iv) Consolidated Statement of Stockholders' Equity for the years ended April 30, 2017, 2016 and 2015, (v) Consolidated Statements of Cash Flows for the years ended April 30, 2017, 2016 and 2015, and (vi) Notes to Audited Consolidated Financial Statements.

*    Filed herewith.

**    Furnished herewith.

#    Indicates management contract or compensatory plan

52

Item 16.    Form 10-K Summary.

None.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	LIBERTY TAX, INC. (Registrant)
Date: July 7, 2017	By:	/s/ JOHN T. HEWITT
		John T. Hewitt Chief Executive Officer and Chairman of the Board (Principal Executive Officer)
Date: July 7, 2017	By:	/s/ KATHLEEN E. DONOVAN
		Kathleen E. Donovan Chief Financial Officer (Principal Financial Officer)
Date: July 7, 2017	By:	/s/ THOMAS S. DANIELS
		Thomas S. Daniels Chief Accounting Officer (Principal Accounting Officer)

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS that each of the undersigned whose signature appears below constitutes and appoints John T. Hewitt and Kathleen E. Donovan, his and her true and lawful attorneys-in-fact, with full power of substitution and resubstitution for him and on his behalf, and in his name, place, and stead, in any and all capacities to execute and sign any and all amendments to this Annual Report on Form 10-K and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact or any of them or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof and the registrant hereby confers like authority on its behalf.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

53

Date: July 7, 2017	By:	/s/ JOHN T. HEWITT
		John T. Hewitt Chief Executive Officer and Chairman of the Board (Principal Executive Officer)
Date: July 7, 2017	By:	/s/ KATHLEEN E. DONOVAN
		Kathleen E. Donovan Chief Financial Officer (Principal Financial Officer)
Date: July 7, 2017	By:	/s/ THOMAS S. DANIELS
		Thomas S. Daniels Chief Accounting Officer (Principal Accounting Officer)
Date: July 7, 2017	By:	/s/ GORDON D'ANGELO
		Gordon D'Angelo Director
Date: July 7, 2017	By:	/s/ JOHN R. GAREL
		John R. Garel Director
Date: July 7, 2017	By:	/s/ STEVEN IBBOTSON
		Steven Ibbotson Director

Date: July 7, 2017	By:	/s/ ROSS LONGFIELD
		Ross Longfield Director
Date: July 7, 2017	By:	/s/ ELLEN MCDOWELL
		Ellen McDowell Director
Date: July 7, 2017	By:	/s/ GEORGE T. ROBSON
		George T. Robson Director
Date: July 7, 2017	By:	/s/ THOMAS HERSKOVITS
		Thomas Herskovits Director
Date: July 7, 2017	By:	/s/ ROBERT M. HOWARD
		Robert M. Howard Director

54

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Financial Statements

As of April 30, 2017 and 2016 and for the fiscal years ended April 30, 2017, 2016, and 2015

(With Report of Independent Registered Public Accounting Firm Thereon)

55

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders

Liberty Tax, Inc.:

We have audited the accompanying consolidated balance sheets of Liberty Tax, Inc. and subsidiaries (the Company) as of April 30, 2017 and 2016, and the related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows for each of the years in the three‑year period ended April 30, 2017. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Liberty Tax, Inc. and subsidiaries as of April 30, 2017 and 2016, and the results of their operations and their cash flows for each of the years in the three‑year period ended April 30, 2017, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Norfolk, Virginia

July 7, 2017

F-1

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

As of April 30, 2017 and 2016

(In thousands, except share data)

	2017			2016
Assets
Current assets:
Cash and cash equivalents	$	16,427		$	9,906
Receivables:
Accounts receivable	54,723			49,908
Notes receivable - current	27,845			26,710
Interest receivable, net of uncollectible amounts	1,967			1,944
Allowance for doubtful accounts - current	(10,052		)	(6,840		)
Total current receivables, net	74,483			71,722
Assets held for sale	11,989			9,886
Deferred income tax asset	6,956			3,496
Other current assets	5,812			5,838
Total current assets	115,667			100,848
Property, equipment, and software, net	39,789			40,957
Notes receivable - non-current	18,213			25,514
Allowance for doubtful accounts - non-current	(1,968		)	(2,010		)
Total non-current notes receivables, net	16,245			23,504
Goodwill	8,576			4,228
Other intangible assets, net	21,224			16,270
Other assets	2,767			7,416
Total assets	$	204,268		$	193,223
Liabilities and Stockholders' Equity
Current liabilities:
Current installments of long-term obligations	$	7,738		$	5,947
Accounts payable and accrued expenses	12,953			11,664
Due to Area Developers (ADs)	23,143			24,977
Income taxes payable	6,442			3,581
Deferred revenue - current	2,892			4,682
Total current liabilities	53,168			50,851
Long-term obligations, excluding current installments, net of debt issuance costs of $60 and $108, respectively	18,461			17,493
Deferred revenue and other - non-current	5,817			7,056
Deferred income tax liability	10,367			6,322
Total liabilities	87,813			81,722
Commitments and contingencies
Stockholders' equity:
Special voting preferred stock, $0.01 par value per share, 10 shares authorized, issued, and outstanding	—			—
Class A common stock, $0.01 par value per share, 21,200,000 shares authorized, 12,682,550 and 11,993,292 shares issued and outstanding at April 30, 2017 and 2016, respectively	127			120
Class B common stock, $0.01 par value per share, 1,000,000 shares authorized, 200,000 and 900,000 shares issued and outstanding at April 30, 2017 and 2016, respectively	2			9
Exchangeable shares, $0.01 par value, 1,000,000 shares authorized, issued and outstanding	10			10
Additional paid-in capital	8,371			7,153
Accumulated other comprehensive loss, net of taxes	(2,084		)	(1,698		)
Retained earnings	110,029			105,907
Total stockholders' equity	116,455			111,501
Total liabilities and stockholders' equity	$	204,268		$	193,223

See accompanying notes to consolidated financial statements.

F-2

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statements of Income

Years ended April 30, 2017, 2016, and 2015

(In thousands, except per share data)

	2017			2016			2015
Revenues:
Franchise fees	$	2,659		$	5,038		$	6,246
AD fees	4,177			6,008			6,901
Royalties and advertising fees	74,291			80,274			80,469
Financial products	51,829			45,327			37,058
Interest income	12,955			13,578			14,707
Assisted tax preparation fees, net of discounts	21,600			15,775			9,947
Other revenue	6,474			7,429			6,844
Total revenues	173,985			173,429			162,172
Operating expenses:
Employee compensation and benefits	44,615			42,882			41,079
Other costs and expenses	58,159			43,927			40,604
AD expense	22,461			27,686			28,497
Advertising expense	11,073			16,420			18,308
Depreciation, amortization, and impairment charges	14,356			10,026			9,900
Impairment of online software and acquired customer lists	—			—			8,392
Total operating expenses	150,664			140,941			146,780
Income from operations	23,321			32,488			15,392
Other income (expense):
Foreign currency transaction gain (loss)	(47		)	29			(2		)
Gain on sale of available-for-sale securities	50			—			—
Interest expense	(2,557		)	(2,039		)	(1,889		)
Income before income taxes	20,767			30,478			13,501
Income tax expense	7,754			11,058			4,811
Net income	13,013			19,420			8,690
Less: Net income attributable to participating securities	(936		)	(1,406		)	(633		)
Net income attributable to Class A and Class B common stockholders	$	12,077		$	18,014		$	8,057
Net income per share attributable to Class A and Class B common stockholders:
Basic	$	0.94		$	1.41		$	0.63
Diluted	0.94			1.38			0.61
Weighted-average shares used to compute net income per share attributable to Class A and Class B common stockholders:
Basic	12,895,561			12,814,774			12,738,887
Diluted	13,916,908			14,024,671			14,294,773
Cash dividends declared per share of common stock and common stock equivalents	$	0.64		$	0.64		$	0.16

See accompanying notes to consolidated financial statements.

F-3

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

Years ended April 30, 2017, 2016, and 2015

(In thousands)

	2017			2016			2015
Net income	$	13,013		$	19,420		$	8,690
Unrealized gain (loss) on available-for-sale securities, net of taxes of $345, $326, and $-, respectively	580			(550		)	—
Reclassified gain on sale of available-for-sale securities included in income, net of taxes of $20, $-, and $-, respectively	(30		)	—			—
Foreign currency translation adjustment	(911		)	(451		)	(763		)
Unrealized loss on interest rate swap agreement, net of taxes of $16, $-, and $-, respectively	(25		)	—			—
Comprehensive income	$	12,627		$	18,419		$	7,927

See accompanying notes to consolidated financial statements.

F-4

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statement of Stockholders' Equity

Year ended April 30, 2017

(In thousands)

	Class A				Class B					Special voting preferred stock
	Common stock				Common stock
	Shares		Amount		Shares		Amount			Shares	Amount
Balance at May 1, 2016	11,993		$	120	900		$	9		—	$	—
Shares issued	6		—		—		—			—	—
Repurchase of common stock	(33	)	—		—		—			—	—
Vesting of restricted stock	17		—		—		—			—	—
Converted Class B shares to Class A shares	700		7		(700	)	(7		)	—	—
Balance at April 30, 2017	12,683		$	127	200		$	2		—	$	—

	Exchangeable shares			Additional paid-in capital			Accumulated other comprehensive income (loss), net			Retained earnings
	Shares	Amount											Total
Balance at May 1, 2016	1,000	$	10	$	7,153		$	(1,698	)	$	105,907		$	111,501
Exercise of stock options	—	—		—			—			—			—
Repurchase of common stock	—	—		(420		)	—			—			(420		)
Stock-based compensation expense	—	—		2,016			—			—			2,016
Tax impact of stock option activity	—	—		(378		)	—			—			(378		)
Net income	—	—		—			—			13,013			13,013
Cash dividends ($0.64 per share)	—	—		—			—			(8,891		)	(8,891		)
Foreign currency translation adjustment	—	—		—			(911		)	—			(911		)
Unrealized gain on available-for-sale securities, net of taxes	—	—		—			580			—			580
Reclassified gain on sale of available-for-sale securities included in income, net of taxes	—	—		—			(30		)	—			(30		)
Unrealized loss on interest rate swap agreement, net of taxes	—	—		—			(25		)	—			(25		)
Balance at April 30, 2017	1,000	$	10	$	8,371		$	(2,084	)	$	110,029		$	116,455

See accompanying notes to consolidated financial statements.

F-5

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statement of Stockholders' Equity

Year ended April 30, 2016

(In thousands)

	Class A					Class B			Special voting preferred stock
	Common stock					Common stock
	Shares		Amount			Shares	Amount		Shares	Amount
Balance at May 1, 2015	11,905		$	119		900	$	9	—	$	—
Exercise of stock options	155		2			—	—		—	—
Shares issued	2		—			—	—		—	—
Repurchase of common stock	(82	)	(1		)	—	—		—	—
Vesting of restricted stock	13		—			—	—		—	—
Balance at April 30, 2016	11,993		$	120		900	$	9	—	$	—

	Exchangeable shares			Additional paid-in capital			Accumulated other comprehensive income, net			Retained earnings
	Shares	Amount											Total
Balance at May 1, 2015	1,000	$	10	$	4,082		$	(697	)	$	95,339		$	98,862
Exercise of stock options	—	—		2,284			—			—			2,286
Repurchase of common stock	—	—		(1,976		)	—			—			(1,977		)
Stock-based compensation expense	—	—		1,863			—			—			1,863
Tax impact of stock option activity	—	—		900			—			—			900
Net income	—	—		—			—			19,420			19,420
Cash dividends ($0.64 per share)	—	—		—			—			(8,852		)	(8,852		)
Foreign currency translation adjustment	—	—		—			(451		)	—			(451		)
Unrealized gain on available-for-sale securities, net of taxes	—	—		—			(550		)	—			(550		)
Balance at April 30, 2016	1,000	$	10	$	7,153		$	(1,698	)	$	105,907		$	111,501

See accompanying notes to consolidated financial statements.

F-6

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statement of Stockholders' Equity

Year ended April 30, 2015

(In thousands)

	Class A					Class B			Special voting preferred stock
	Common stock					Common stock
	Shares		Amount			Shares	Amount		Shares	Amount
Balance at May 1, 2014	12,409		$	124		900	$	9	—	$	—
Exercise of stock options	762		8			—	—		—	—
Shares issued	3		—			—	—		—	—
Repurchase of common stock	(1,284	)	(13		)	—	—		—	—
Vesting of restricted stock	15		—			—	—		—	—
Balance at April 30, 2015	11,905		$	119		900	$	9	—	$	—

	Exchangeable shares			Additional paid-in capital			Accumulated other comprehensive income, net			Retained earnings
	Shares	Amount											Total
Balance at May 1, 2014	1,000	$	10	$	9,402		$	66		$	100,574		$	110,185
Exercise of stock options	—	—		11,975			—			—			11,983
Repurchase of common stock	—	—		(24,575		)	—			(11,720		)	(36,308		)
Stock-based compensation expense	—	—		2,477			—			—			2,477
Tax impact of stock option activity	—	—		4,803			—			—			4,803
Net income	—	—		—			—			8,690			8,690
Cash dividends ($0.16 per share)	—	—		—			—			(2,205		)	(2,205		)
Foreign currency translation adjustment	—	—		—			(763		)	—			(763		)
Balance at April 30, 2015	1,000	$	10	$	4,082		$	(697	)	$	95,339		$	98,862

See accompanying notes to consolidated financial statements.

F-7

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

Years ended April 30, 2017, 2016, and 2015

(In thousands)

	2017			2016			2015
Cash flows from operating activities:
Net income	$	13,013		$	19,420		$	8,690
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for doubtful accounts	10,378			7,282			5,726
Depreciation and amortization	8,325			6,872			8,499
Amortization of deferred financing costs	526			477			547
Impairment of goodwill and other assets	6,031			3,154			9,793
Other (gain) loss including sale of property, equipment, and software	(387		)	14			246
Stock-based compensation expense related to equity classified awards	2,016			1,863			2,477
Gain on bargain purchases and sales of Company-owned offices	(1,100		)	(855		)	(414		)
Gain on sale of available-for-sale securities	(50		)	—			—
Equity in (gain) loss of affiliate	(11		)	73			160
Deferred tax expense (benefit)	129			7,384			(3,545		)
Changes in:
Accounts, notes, and interest receivable and deferred revenue	(10,437		)	(14,228		)	(8,869		)
Prepaid expenses and other assets	125			210			(2,911		)
Accounts payable and accrued expenses	556			(6,238		)	2,685
Due to ADs	845			2,631			8,924
Income taxes payable (receivable)	2,487			1,758			(7,491		)
Net cash provided by operating activities	32,446			29,817			24,517
Cash flows from investing activities:
Issuance of operating loans to franchisees and ADs	(94,133		)	(101,552		)	(93,365		)
Payments received on operating loans to franchisees and ADs	89,562			89,786			88,776
Purchases of Company-owned offices, AD rights, and acquired customer lists	(10,049		)	(4,787		)	(8,246		)
Proceeds from sale of Company-owned offices and AD rights	1,339			2,934			3,687
Purchase of available-for-sale securities	—			(4,999		)	—
Proceeds from sale of available-for-sale securities	5,049			—			—
Purchases of property, equipment, and software	(5,022		)	(10,692		)	(11,463		)
Net cash used in investing activities	(13,254		)	(29,310		)	(20,611		)
Cash flows from financing activities:
Proceeds from the exercise of stock options	—			2,286			11,983
Repurchase of common stock	(420		)	(1,977		)	(36,308		)
Dividends paid	(8,891		)	(8,852		)	(2,205		)
Repayment of other long term-obligations	(1,541		)	(2,429		)	(4,349		)
Repayment of mortgages and term loan	(3,740		)	(1,742		)	(1,501		)
Borrowings under revolving credit facility	151,400			166,232			154,633
Repayments under revolving credit facility	(151,400		)	(166,232		)	(154,633		)
Proceeds from mortgage debt	2,200			—			—
Payment for debt issue costs	(35		)	—			(917		)
Tax impact of stock option activity	60			900			4,803
Net cash used in financing activities	(12,367		)	(11,814		)	(28,494		)
Effect of exchange rate changes on cash, net	(304		)	(174		)	(105		)
Net increase (decrease) in cash and cash equivalents	6,521			(11,481		)	(24,693		)
Cash and cash equivalents at beginning of year	9,906			21,387			46,080
Cash and cash equivalents at end of year	$	16,427		$	9,906		$	21,387

See accompanying notes to consolidated financial statements.

F-8

LIBERTY TAX, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Continued)

Years ended April 30, 2017, 2016, and 2015

(In thousands)

	2017			2016			2015
Cash paid for interest, net of capitalized interest of $235, $325, and $200	$	2,187		$	1,628		$	1,467
Cash paid for taxes, net of refunds	5,058			1,025			11,160
Accrued capitalized software costs included in accounts payable	55			407			168
During the years ended April 30, 2017, 2016, and 2015, the Company acquired certain assets from franchisees, ADs, and third parties as follows:
Fair value of assets purchased	$	29,732		$	19,726		$	18,310
Receivables applied, net of amounts written-off, due ADs and related deferred revenue	(10,465		)	(12,050		)	(6,931		)
Bargain purchase gains	(809		)	(552		)	(367		)
Long-term obligations and accounts payable issued	(8,409		)	(2,337		)	(2,766		)
Cash paid to franchisees, ADs, and third parties	$	10,049		$	4,787		$	8,246
During the years ended April 30, 2017, 2016, and 2015, the Company sold certain assets to franchisees and ADs as follows:
Book value of assets sold	$	7,555		$	9,585		$	11,469
Loss on sale - loss recognized	(107		)	(131		)	(298		)
Gain on sale - revenue deferred	618			1,688			2,000
Notes received	(6,727		)	(8,208		)	(9,484		)
Cash received from franchisees and ADs	$	1,339		$	2,934		$	3,687

See accompanying notes to consolidated financial statements.

F-9

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

(1) Description of Business and Summary of Significant Accounting Policies

Description of Business

Liberty Tax, Inc. (the "Company"), a Delaware corporation, is a holding company engaged through its subsidiaries as a franchisor and, to a lesser degree, an operator of a system of income tax preparation offices located in the United States and Canada. The Company's principal operations are conducted through JTH Tax, Inc. (d/b/a Liberty Tax Service), the Company's largest subsidiary. Through this system of income tax preparation offices, the Company also facilitates refund-based tax settlement financial products, such as refund transfer products in the U.S. and personal income tax refund discounting in Canada. The Company also offers online tax preparation services. In fiscal 2015, the Company changed its name from JTH Holding, Inc. to Liberty Tax, Inc.

The Company provides a substantial amount of lending to its franchisees and area developers ("ADs"). The Company allows franchisees and ADs to finance a portion of the initial franchise fee and AD fee, which are paid over time. The Company also offers its franchisees working capital loans to fund their operations.

Basis of Presentation

The consolidated financial statements include the accounts of Liberty Tax, Inc. and its wholly-owned subsidiaries. Assets and liabilities of the Company's Canadian operations have been translated into U.S. dollars using the exchange rate in effect at the end of the year. Revenues and expenses have been translated using the average exchange rates in effect each month of the year. Foreign exchange transaction gains and losses are recognized when incurred. The Company consolidates any entities in which it has a controlling interest, the usual condition of which is ownership of a majority voting interest. The Company also considers for consolidation an entity in which the Company has certain interest where a controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity ("VIE"), is required to be consolidated by its primary beneficiary. The Company does not possess any ownership interests in franchisee entities; however, the Company may provide financial support to franchisee entities. Because the Company's franchise arrangements provide franchisee entities the power to direct the activities that most significantly impact their economic performance, the Company does not consider itself the primary beneficiary of any such entity that might be a VIE. Based on the results of management's analysis of potential VIEs, the Company has not consolidated any franchisee entities. The Company's maximum exposure to loss resulting from involvement with potential VIEs is attributable to accounts and notes receivables and future lease payments due from franchisees. When the Company does not have a controlling interest in an entity but exerts significant influence over the entity, the Company applies the equity method of accounting. All intercompany balances and transactions have been eliminated in consolidation.

The audited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). In the opinion of management, all adjustments necessary for a fair presentation of such financial statements in accordance with GAAP have been recorded.

F-10

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Office Count

The following table shows the U.S. office activity, the number of processing centers and Canadian offices, and a breakdown of Company-owned and franchised offices for the 2017, 2016, and 2015 tax seasons.

	Tax Season
	2017		2016		2015
U.S. Office Locations:
Permanent Office Locations:
Operated during the prior tax season	3,960		3,764		3,663
Offices opened	172		453		397
Offices closed	(422	)	(257	)	(296	)
Operated during the current tax season	3,710		3,960		3,764
Seasonal Office Locations:
Operated during the prior tax season	211		262		486
Offices opened	37		127		118
Offices closed	(181	)	(178	)	(342	)
Operated during the current tax season	67		211		262
Processing Centers	46		54		43
Total U.S. Office Locations	3,823		4,225		4,069
Canada Office Locations	254		262		259
Total Office Locations	4,077		4,487		4,328
Additional Office Information:
Company-owned offices	362		310		182
Franchised offices	3,715		4,177		4,146
Total office locations	4,077		4,487		4,328

SiempreTax+, operated 159 offices during the 2017 tax season compared to 144 during the 2016 season and 57 in the 2015 season. These offices consist of second offices opened by current franchisees in territories they already owned, conversions of existing Liberty Tax offices, and offices opened in new territories.

Territory Sales

The Company sold 73, 184, and 212 new territories during fiscal 2017, 2016 and 2015, respectively. New territories include territories sold to new franchisees and additional territories sold to existing franchisees.

Significant Accounting Policies

Cash and Cash Equivalents - The Company considers all highly liquid debt instruments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents are maintained in bank deposit accounts, which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on its cash and cash equivalents balances.

Accounts Receivable - Accounts receivable are recorded at the invoiced amount net of an allowance for doubtful accounts and accrue finance charges at a 12% annual rate, compounded monthly, if unpaid after 30 days. Account balances are charged off against the allowance after all possible means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its accounts receivable.

F-11

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Notes Receivable - Notes receivable are recorded less unrecognized revenue, net of an allowance for doubtful accounts. Unrecognized revenue relates to the financed portion of franchise fees and AD fees and, in the case of sales of Company-owned offices, the financed portion of gains related to such sales in each case where revenue has not yet been recognized. Interest income is accrued on the unpaid principal balance. The Company puts notes receivable on non-accrual status and provides an allowance against accrued interest if it is determined the likelihood of collecting substantially all of the note and accrued interest is not probable. Generally, payments received on notes receivable on non-accrual status are applied to the principal note balance until the note is current and then to interest income. Notes are written off against the allowance when all possible means of collection have been exhausted and the potential for recovery is considered remote.

Concentrations of credit risk - Financial instruments that could potentially subject the Company to concentrations of credit risk consist of accounts and notes receivable with its franchisees. The Company manages such risk by evaluating the financial position and value of the franchisees as well as obtaining the personal guarantee of the individual franchisees. At April 30, 2017 and 2016, there were no significant concentrations of credit risk associated with any individual franchisee or group of franchisees.

Allowance for Doubtful Accounts - The allowance for doubtful accounts includes the Company's best estimate of the amount of probable credit losses in the Company's existing accounts and notes receivable. Because the repayment of accounts and notes receivable is dependent on the performance of the underlying franchises, management estimates the amount of the allowance for doubtful accounts based on a comparison of amounts due to the estimated fair value of the underlying franchises which collateralize such receivables. Management believes the allowance is adequate to cover the Company's credit loss exposure. If the carrying amount exceeds the fair value, the receivable is considered impaired.

Available-for-sale Securities - From time to time, the Company purchases corporate equity securities that are classified as available -for-sale; changes in fair value of such securities are recognized, net of tax, in accumulated other comprehensive income in the stockholders' equity section of the balance sheet. Cash flows for the purchase and sale of these investments are classified as investing activities.

Assets Held for Sale - Assets held for sale consist of Company-owned offices that the Company intends to sell to a new or existing franchisee within one year. Assets held for sale are recorded at the lower of the carrying value or the estimated sales price, less costs to sell, and are evaluated for impairment at least annually. If in the opinion of management, the Company will not be able to sell such offices, within one year from the balance sheet date, the carrying amount is reclassified to held for use and a cumulative adjustment is recorded to depreciation and amortization expense. Additionally, in fiscal 2017, we transferred a building to assets held for sale as the building is up for sale.

Property, Equipment, and Software - Property, equipment, and software are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets, generally three to five years for computer equipment, three to seven years for software, five to seven years for furniture and fixtures, and twenty to thirty years for buildings. Leasehold improvements are amortized over the lesser of the lease term or the estimated useful lives of the assets. Certain allowable costs of software developed or obtained for internal use are capitalized and typically amortized over the estimated useful life of the software.

Goodwill - Goodwill represents the excess of costs over fair value of assets of businesses acquired. The reporting unit for the acquisition of assets from various franchisees is considered to be the franchise territory, and these assets are operated as Company-owned offices. Goodwill is not amortized, but instead tested for impairment at least annually. Goodwill is tested for impairment more frequently if events and circumstances indicate that the asset might be impaired. The Company performed its annual impairment testing as of April 30, 2017.

Revenue Recognition - The Company earns revenue from the sales of franchises and granting of AD rights. Additionally, the Company earns revenue from royalties and advertising fees and other products and services. Typically, franchise rights are granted to franchisees for a term of five years with an option to renew at no additional cost. In exchange for franchise fees and royalties and advertising fees, the Company is obligated by its franchise agreements to provide training, an operations manual, site selection guidance, tax preparation software, operational assistance, tax and technical support, the ability to perform electronic filing, and marketing and advertising. Franchise fee revenue for the sales of individual territories is recognized when the obligations of the Company to prepare the franchisee for operation are substantially complete, up to the amount of cash received.

AD rights have historically been granted for a term of ten years. The Company changed the term of new and renewal AD contracts to six years in fiscal 2015. AD fees are recognized as revenue on a straight-line basis over the initial contract term of

F-12

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

each AD agreement with the cumulative amount of revenue recognized not to exceed the amount of cash received. Amounts due to ADs for their services under an AD agreement are expensed as the related franchise fees and royalty revenues are recognized.

Royalties and advertising fees are recognized as franchise territories generate sales. Tax return preparation fees and financial products revenue are recognized as revenue in the period the related tax return is filed for the customer. Discounts for promotional programs are recorded at the time the return is filed and are recorded as reductions to revenues.

Interest income on notes receivable is recognized based on the outstanding principal note balance less unrecognized revenue unless it is put on non-accrual status. Interest income on the unrecognized revenue portion of notes receivable is recognized when received. For accounts receivable, interest income is recognized based on the outstanding receivable balance over 30 days old, net of an allowance.

Gains on sales of Company-owned offices are recognized when cash is received. Losses on sales of Company-owned offices are recognized immediately.

Deferred Revenue - Deferred revenue represents the amount of cash received for AD fees in excess of the revenue recognized.

Derivative Instruments and Hedging Activities - The Company recognizes all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values. For derivatives designated in hedging relationships, changes in fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income to the extent the derivative is effective at offsetting the changes in cash flows being hedged until the hedged item affects earnings.

The Company only enters into a derivative contract when it intends to designate the contract as a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument's effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk; the derivative expires or is sold, terminated, or exercised; the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring; or management determines to remove the designation of the cash flow hedge.

In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is no longer probable that a forecasted transaction will occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in other comprehensive income related to the hedging relationship.

Please see "Note 8 - Derivative Instruments and Hedging Activates" for a description of the cash flow hedge the Company entered into during fiscal 2017.

The Company did not have any outstanding derivative instruments or hedging activities as of April 30, 2016.

Deferred Income Taxes - Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities, which are shown on our consolidated balance sheets, are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change

F-13

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

in tax rates is recognized in income in the period that includes the enactment date. The Company has elected to classify interest charged on a tax settlement in interest expense, and accrued penalties, if any, in selling, general, and administrative expenses.

The determination of our provision for income taxes requires significant judgment, the use of estimates, and the interpretation and application of complex tax laws. Significant judgment is required in assessing the timing and amounts of deductible and taxable items.  We record unrecognized tax benefit liabilities for known or anticipated tax issues based on our analysis of whether, and the extent to which, additional taxes will be due.

Intangible Assets and Other Long-Lived Assets - Amortization on intangible assets is calculated using the straight-line method over the estimated useful lives of the assets, generally from two to ten years. Long-lived assets, such as property, equipment, and software, and other purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. Recognition and measurement of a potential impairment is performed for these assets at the lowest level where cash flows are individually identifiable. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary. Assets expected to be sold within one year are no longer depreciated or amortized. These assets are classified as held-for-sale and are presented separately in the appropriate section of the consolidated balance sheets at the lower of their carrying amount or fair value less estimated cost to sell.

Comprehensive Income - Comprehensive income consists of net income, foreign currency translation adjustments, reclassified gain on sale of available-for-sale securities, net of taxes, and the unrealized gains or losses on equity securities available for sale and derivatives determined to be cash flow hedges, net of taxes.

Advertising Expenses - Advertising costs, which consists of direct mail, radio, print media and online advertisements intended to attract new franchisees and customers, are expensed in the period incurred.

Office Closing Costs - Closed office liabilities are provided on the basis of the present value of estimated remaining non-cancellable lease payments, net of estimated subtenant income. An estimate the net lease liability using a discount rate to calculate the present value of the remaining net rent payments on closed offices. Closed office lease liabilities are paid over the lease terms associated with the closed offices, which generally have remaining terms ranging from one to seven years.

Stock-Based Compensation - The Company records the cost of its employee stock-based compensation as compensation expense in its consolidated statements of income. Compensation costs related to stock options are based on the grant-date fair value of awards using the Black-Scholes-Merton option pricing model and considering forfeitures. Compensation costs related to restricted stock units are based on the grant-date fair value and are amortized on a straight-line basis over the vesting period. For liability classified awards the Company records costs based on the fair value at the reporting date. The Company recognizes compensation costs for an equity-classified award that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award; changes in the fair value liability-classified awards are recognized as they occur. The Company reflects the excess tax benefits related to stock option exercises as additional paid-in capital on its consolidated balance sheets and as financing cash flows on its consolidated statements of cash flows.

Lease Accounting - The Company leases its store locations under operating leases. The Company recognizes minimum rent expense beginning when possession of the property is taken from the landlord. When a lease contains a predetermined fixed escalation of the minimum rent, the Company recognizes the related rent expense on a straight-line basis and records the difference between the recognized rental expense and the amounts payable under the lease as deferred rent. 

Use of Estimates

Management has made a number of estimates and assumptions related to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period to prepare these consolidated financial statements and accompanying notes in conformity with GAAP. Actual results could differ from those estimates.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.

F-14

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers." This update will replace existing revenue recognition guidance in GAAP and requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The new standard is effective for the Company in fiscal year 2019, which begins on May 1, 2018. The standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption ("modified retrospective method"). The Company currently expects to apply the modified retrospective transition method upon adoption. The Company expects the adoption of the new guidance to change the timing of recognition of initial franchise fees and AD fees. Currently, franchise fees are generally recognized when our obligations to prepare the franchise for operation have been substantially completed and cash has been received and AD fees are recognized on the straight-line basis over the contract term not to exceed the amount of cash received. The new guidance will generally require these fees to be recognized over the term of the related franchise or AD agreements, which will impact the revenue recognized for franchise fees. The Company does not expect this new guidance to materially impact the recognition of royalty and advertising fees, financial products revenue or tax preparation fees. The Company is continuing to evaluate the impact the adoption of this new guidance will have on these and other revenue transactions, in addition to the impact on accounting policies and related disclosures.

In November 2015 the FASB issued ASU 2015-17, "Balance Sheet Classification of Deferred Taxes (Topic 740)," which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as non-current. This ASU is effective for interim and annual periods in fiscal years beginning after December 15, 2016, which means that it will be effective for the Company in the first quarter of its fiscal year beginning May 1, 2017.

In February 2016, the FASB issued ASU No. 2016-02, "Leases." This update will replace existing lease guidance in GAAP and will require lessees to recognize lease assets and lease liabilities on the balance sheet for all leases and disclose key information about leasing arrangements, such as information about variable lease payments and options to renew and terminate leases. When implemented, lessees and lessors will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The update is effective for interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently finalizing its implementation plan and evaluating the impact of the new pronouncement on its consolidated financial statements. The Company expects the adoption of this pronouncement to result in a material increase in the assets and liabilities on its consolidated balance sheets and to not have a material impact on its consolidated income statements.

In May 2016, the Company adopted Accounting Standards Update ("ASU") 2015-03, "Simplifying the Presentation of Debt Issuance Costs", which requires that debt issuance costs related to a recognized debt liability to be presented on the balance sheet as a direct deduction from the debt liability, similar to the presentation of debt premiums and discounts, and ASU 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements", which further clarifies the presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-03 and ASU 2015-15 applies retrospectively and does not change the recognition and measurement requirements for debt issuance costs. The adoption of ASU 2015-03 and ASU 2015-15 resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's borrowings from other assets to long-term obligations within our consolidated balance sheet as of January 31, 2017, April 30, 2016 and January 31, 2016, respectively.

In May 2016, the Company adopted ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis", which effectively eliminates the presumption that a general partner should consolidate a limited partnership, modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIE"s) or voting interest entities, and affects the consolidation analysis of reporting entities that are involved with VIEs (particularly those that have fee arrangements and related party relationships). The Company has completed its evaluation and has concluded there is no material impact from the adoption of the new standard on its consolidated financial statements.

In March 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-09, "Improvements to Employee Share Based Payment Accounting (Topic 718)", to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard will be effective for the Company beginning with its first quarterly filing in fiscal year 2018. Early adoption is permitted, including adoption in an interim period prior to fiscal 2018. The

F-15

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230)", which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. The update is intended to reduce the existing diversity in practice and is effective for the Company beginning with its first quarterly filing in fiscal year 2019. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, "Measurement of Credit Losses on Financial Instruments", which changes how companies will measure credit losses for most financial assets and certain other instruments that aren't measured at fair value through net income. The standard replaces the "incurred loss" approach with an "expected loss" model for instruments measured at amortized cost (which generally will result in the earlier recognition of allowances for losses) and requires companies to record allowances for available-for-sale debt securities, rather than reduce the carrying amount. In addition, companies will have to disclose significantly more information, including information used to track credit quality by year of origination, for most financing receivables. The ASU should be applied as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the standard is effective. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods therein. The ASU is effective for the Company beginning in the first quarter of fiscal year 2021. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” This new standard eliminates Step 2 from the goodwill impairment test. Instead, an entity should compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The standard will be effective for the Company in the first quarter of our fiscal year 2021. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

Segment Reporting

Management has identified two operating segments, U.S. operations and Canadian operations. Although there are two operating segments, each segment is engaged in providing tax return preparation and related services and products. These two operating segments, which have similar gross margin and sales trends, have been aggregated into a single reporting segment because both segments are similar in the nature of services offered, production process, type of customer, the distribution methods, and the regulatory environment in which they operate. Canadian operations contributed $7.0 million, $7.0 million, and $6.9 million in revenues for the years ended April 30, 2017, 2016, and 2015, respectively.

(2) Notes and Accounts Receivable

The Company provides financing to franchisees and ADs for the purchase of franchises, areas and Company-owned offices, and operating loans for working capital and equipment needs. The franchise-related notes generally are payable over five years and the operating loans generally are due within one year. Most notes bear interest at 12%.

Notes and interest receivable, net of unrecognized revenue, as of April 30, 2017 and 2016 are presented in the consolidated balance sheets as follows:

	2017		2016
	(In thousands)
Notes receivable - current	$	27,845	$	26,710
Notes receivable - non-current	18,213		25,514
Interest receivable, net of uncollectible amounts	1,967		1,944
Total notes and interest receivable, net of unrecognized revenue	$	48,025	$	54,168

F-16

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Most of the notes receivable are due from the Company's franchisees and ADs and are collateralized by the underlying franchise and, when the franchise or AD is an entity, are guaranteed by the owners of the respective entity. The debtors' ability to repay the notes is dependent upon both the performance of the tax preparation industry as a whole and the individual franchisees' or ADs' areas.

The table above does not include unrecognized revenue. Unrecognized revenue relates to the financed portion of franchise fees and AD fees and, in the case of sales of Company-owned offices, the financed portion of gains related to these sales in each case where revenue has not yet been recognized. For franchise fees and gains related to the sale of Company-owned offices, revenue is recorded as note payments are received by the Company. Payments on AD fee notes receivable generate a corresponding increase in deferred revenue, which is amortized into revenue over the life of the AD contract. In fiscal 2015 the Company changed the term of new and renewal AD contracts to six years from ten years and the revenue for these contracts will be recognized over that period, subject to the receipt of cash. Unrecognized revenue was $29.4 million and $35.2 million at April 30, 2017 and 2016, respectively.

Allowance for Doubtful Accounts

The adequacy of the allowance for doubtful accounts is assessed on a quarterly basis and adjusted as deemed necessary. Management believes the recorded allowance is adequate based upon its consideration of the estimated value of the franchises and AD areas, which collateralize the receivables. Any adverse change in the tax preparation industry or the individual franchisees' or ADs' areas could affect the Company's estimate of the allowance.

Activity in the allowance for doubtful accounts for the years ended April 30, 2017, 2016, and 2015 was as follows.

	2017			2016			2015
	(In thousands)
Balance at beginning of year	$	8,850		$	7,355		$	6,850
Provision for doubtful accounts	10,378			7,282			5,726
Write-offs	(7,119		)	(5,737		)	(5,122		)
Foreign currency adjustment	(89		)	(50		)	(99		)
Balance at end of year	$	12,020		$	8,850		$	7,355

Management considers specific accounts and notes receivable to be impaired if the net amounts due exceed the fair value of the underlying franchise at the time of the annual valuation and estimates an allowance for doubtful accounts based on that excess. While not specifically identifiable as of the balance sheet date, the Company's experience also indicates that a portion of other accounts and notes receivable are also impaired, because management does not expect to collect all principal and interest due under the current contractual terms. Net amounts due include contractually obligated accounts and notes receivable plus accrued interest, net of unrecognized revenue, reduced by the allowance for uncollected interest, amounts due ADs, related deferred revenue, and amounts owed to the franchisee by the Company. In establishing the fair value of the underlying franchise, management considers a variety of factors including recent sales of Company-owned stores, recent sales between franchisees, net fees of open offices earned during the most recently completed tax season, and the number of unopened offices.

F-17

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

The allowance for doubtful accounts at April 30, 2017 and 2016 was allocated as follows.

	2017			2016
	(In thousands)
Impaired:
Accounts receivable	$	11,396		$	7,083
Notes and interest receivable, net of unrecognized revenue	14,646			12,960
Less amounts due to ADs and franchisees	(1,834		)	(1,426		)
Amounts receivable less amounts due to ADs and franchisees	$	24,208		$	18,617
Allowance for doubtful accounts for impaired accounts and notes receivable	$	9,542		$	7,787
Non-impaired:
Accounts receivable	$	43,327		$	42,825
Notes and interest receivable, net of unrecognized revenue	33,379			41,208
Less amounts due to ADs and franchisees	(23,119		)	(26,183		)
Amounts receivable less amounts due to ADs and franchisees	$	53,587		$	57,850
Allowance for doubtful accounts for non-impaired accounts and notes receivable	$	2,478		$	1,063
Total:
Accounts receivable	$	54,723		$	49,908
Notes and interest receivable, net of unrecognized revenue	48,025			54,168
Less amounts due to ADs and franchisees	(24,953		)	(27,609		)
Amounts receivable less amounts due to ADs and franchisees	$	77,795		$	76,467
Total allowance for doubtful accounts	$	12,020		$	8,850

The Company's average investment in impaired notes receivable during the fiscal years ended April 30, 2017, 2016, and 2015 was $11.3 million, $9.0 million, and $7.9 million, respectively. Interest income recognized related to performing impaired notes was $1.2 million, $0.9 million, and $0.7 million for the fiscal years ended April 30, 2017, 2016, and 2015, respectively.

F-18

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Analysis of Past Due Receivables

The breakdown of accounts and notes receivable past due at April 30, 2017 and 2016 was as follows.

	2017
	Past due		Current		Interest receivable, net		Total receivables
	(In thousands)
Accounts receivable	$	28,892	$	25,831	$	—	$	54,723
Notes and interest receivable, net	7,034		39,024		1,967		48,025
Total accounts, notes, and interest receivable, net	$	35,926	$	64,855	$	1,967	$	102,748

	2016
	Past due		Current		Interest receivable, net		Total receivables
	(In thousands)
Accounts receivable	$	24,712	$	25,196	$	—	$	49,908
Notes and interest receivable, net	6,142		46,082		1,944		54,168
Total accounts, notes, and interest receivable, net	$	30,854	$	71,278	$	1,944	$	104,076

Accounts receivable are considered to be past due if unpaid 30 days after billing and notes receivable are considered past due if unpaid 90 days after due date. If it is determined the likelihood of collecting substantially all of the note and accrued interest is not probable the notes are put on non-accrual status. The Company's investment in notes receivable on nonaccrual status at April 30, 2017 and 2016 was $7.0 million and $6.1 million, respectively. Payments received on notes in nonaccrual status are applied to the principal note balance until the note is current and then to interest income. Nonaccrual notes that are paid current are moved back into accrual status during the next annual review.

(3) Investments

During the year ended April 30, 2016, the Company purchased a corporate equity security for $5.0 million, which was classified as available-for-sale and reported in other non-current assets. The Company recorded an unrealized loss at April 30, 2016 of $0.5 million, net of taxes, which was reported in the Company's consolidated statements of comprehensive income. This security was sold during the first half of fiscal 2017 and a gain on the sale of $50,000 was recognized and reclassified out of accumulated other comprehensive income, net of taxes and recorded as other income. The Company had no other such transactions during the year ended April 30, 2017.

(4) Property, Equipment, and Software, Net

Property, equipment, and software at April 30, 2017 and 2016 was as follows:

	2017		2016
	(In thousands)
Land and land improvements	$	1,464	$	2,413
Buildings and building improvements	7,964		8,733
Leasehold improvements	132		138
Furniture, fixtures, and equipment	5,788		6,307
Software	50,413		44,418
Property, equipment, and software, gross	65,761		62,009
Less accumulated depreciation and amortization	25,972		21,052
Property, equipment, and software, net	$	39,789	$	40,957

F-19

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

The software included above includes both internally developed software and purchased software. Included in software are $20.2 million and $19.9 million of assets that had not been placed into service at April 30, 2017 and 2016, respectively. See Note 5 for a description of the impairment related to the Company's online software and acquired online customer lists in the year ended April 30, 2015.

Total depreciation and amortization expense on property, equipment, and software was $4.2 million, $4.7 million, and $5.5 million for the years ended April 30, 2017, 2016, and 2015, respectively.

The Company is obligated under various operating leases for office space that expire at various dates. At April 30, 2017, future minimum lease payments under non-cancelable operating leases with initial or remaining lease terms in excess of one year, together with amounts due from franchisees under subleases, were as follows:

	Lease payments		Sublease receipts
	(In thousands)
Year ending April 30:
2018	$	9,518	$	4,352
2019	5,885		2,733
2020	3,455		1,785
2021	1,591		726
2022	670		344
Thereafter	263		150
Total minimum lease payments	$	21,382	$	10,090

Total rent expense for operating leases, net of subleases, was $7.7 million, $4.7 million, and $3.2 million for the years ended April 30, 2017, 2016, and 2015, respectively.

(5) Goodwill and Intangible Assets

Changes in the carrying amount of goodwill for the years ended April 30, 2017 and 2016 were as follows:

	2017			2016
	(In thousands)
Balance at beginning of year	$	4,228		$	3,377
Acquisitions of assets from franchisees and third parties	3,649			960
Disposals and foreign currency changes, net	(226		)	(52		)
Impairments	(184		)	(57		)
Reclassified from assets held for sale	1,109			—
Balance at end of year	$	8,576		$	4,228

The Company performed its annual impairment review of goodwill and recorded impairment of $0.2 million and $0.1 million for the years ended April 30, 2017 and 2016, respectively.

The impairment recorded above was determined using the fair value of the underlying franchise, and where appropriate a discounted cash flow model, and is included in the depreciation, amortization and impairment charges in the consolidated statements of income.

F-20

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Components of amortizable intangible assets as of April 30, 2017 and 2016 were as follows:

	April 30, 2017
	Weighted average amortization period	Gross carrying amount		Accumulated amortization			Net carrying amount
	(In thousands)
Customer lists acquired from unrelated third parties	4 years	$	2,827	$	(899	)	$	1,928
Assets acquired from franchisees:
Customer lists	4 years	1,189		(908		)	281
Reacquired rights	2 years	935		(919		)	16
AD rights	10 years	26,427		(7,428		)	18,999
Total intangible assets		$	31,378	$	(10,154	)	$	21,224

	April 30, 2016
	Weighted average amortization period	Gross carrying amount		Accumulated amortization			Net carrying amount
	(In thousands)
Customer lists acquired from unrelated third parties	4 years	$	1,027	$	(339	)	$	688
Assets acquired from franchisees:
Customer lists	4 years	1,380		(500		)	880
Reacquired rights	2 years	511		(482		)	29
AD rights	10 years	20,218		(5,545		)	14,673
Total intangible assets		$	23,136	$	(6,866	)	$	16,270

For the years ended April 30, 2017 and 2016 the Company recorded as intangible assets of less than $0.1 million, and $1.8 million, respectively, from acquisitions of various franchises and third parties. During fiscal 2017 and fiscal 2016, the majority of U.S. franchise acquisitions were recorded as assets held for sale, while Canadian franchise acquisitions continued to be recorded as intangible assets. All franchise acquisitions were accounted for as business combinations. Also during fiscal 2017 we purchased six offices which we have only preliminary estimates of fair values of the identifiable assets acquired.

The purchase price of assets acquired from franchisees and third parties and recorded as customer lists, reacquired rights, and goodwill and held for use during fiscal 2017 and 2016, was allocated as follows.

	2017		2016
	(In thousands)
Customer lists	$	13	$	728
Reacquired rights	11		39
Goodwill	25		1,048
Purchase price of assets acquired from franchisees, not held for sale	$	49	$	1,815

During the third and fourth quarters of 2017, the Company acquired the assets of six unrelated offices of smaller regional or local accounting firms for cash of $2.3 million and $2.8 million of estimated contingent consideration that is included in long-term obligations. The offices perform year round accounting services. The following table summarizes the preliminary estimates of the fair values of the identifiable assets acquired. The preliminary estimates of the fair value of identifiable assets are based on estimates and assumptions that are are subject to revisions, this may result in adjustments to the preliminary values presented below, when management's estimates are finalized:

F-21

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

	April 30, 2017
	(in thousands)
Accounts receivable	$	261
Property, equipment, and software, net	55
Customer lists	1,120
Goodwill	3,624
Total purchase price	$	5,060

The Company intends to sell the majority of assets associated with Company-owned offices within one year. During the years ended April 30, 2017 and 2016, impairment analysis were performed for amortizable intangible assets. Write-downs of assets acquired from franchisees relate to Company-owned offices that were subsequently closed and impairment of the fair value of existing Company-owned offices. As a result, the carrying values of assets acquired from franchisees were reduced by less than $0.1 million for the fiscal year ended April 30, 2017, less than $0.1 million for 2016, and $0.5 million for 2015. These amounts were included in depreciation, amortization and impairment charges, in the consolidated statements of income. The Company estimated the fair value of assets associated with Company-owned offices based on various models.

For the years ended April 30, 2017, 2016, and 2015, amortization expense was $4.1 million, $2.3 million, and $3.6 million, respectively. Annual amortization expense for the next five years is estimated to be as follows (in thousands):

Year ending April 30:
2018	$	3,664
2019	3,438
2020	3,109
2021	2,559
2022	2,269
Total estimated amortization expense	$	15,039

(6) Assets Held for Sale

During fiscal 2017, the Company acquired $16.6 million in assets from U.S. franchisees and third parties that were first accounted for as business combinations, with the value allocated to customer lists and reacquired rights of $8.3 million and goodwill of $8.3 million prior to being recorded as assets held for sale. During fiscal 2016, the Company acquired $13.3 million in assets from U.S. franchisees and third parties that were first accounted for as business combinations, with the value allocated to customer lists and reacquired rights of $6.1 million and goodwill of $7.2 million prior to being recorded as assets held for sale. The acquired businesses are operated as Company-owned offices until a buyer is located and a new franchise agreement is entered into.

Changes in the carrying amounts of assets held for sale for the fiscal years ended April 30, 2017 and 2016 were as follows:

	2017			2016
	(In thousands)
Balance at beginning of year	$	9,886		$	5,160
Reacquired, acquired from third parties, and other	16,600			13,309
Dispositions	(7,994		)	(6,526		)
Impairment	(5,663		)	(2,057		)
Transferred to assets held for use	(2,428		)	—
Transferred from property and equipment	1,588			—
Balance at end of year	$	11,989		$	9,886

F-22

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

The Company acquired these assets for $5.1 million in cash, the issuance of $2.8 million in long-term obligations and $8.7 million of receivables applied.

During fiscal 2017, the Company reviewed assets held for sale for assets that were deemed unlikely to be sold in the next 12 months. Assets totaling $2.4 million, comprised of $0.7 million of customer lists, $0.6 million of reacquired rights and $1.1 million of goodwill, were identified and transferred to assets held for use. Amortization expense was recorded on a cumulative basis for customers lists and reacquired rights for $0.3 million and $0.5 million, respectively.

During fiscal 2017, the Company transferred a building it had previously been using and was classified as fixed assets to assets held for sale.

(7) Long-Term Obligations

The Company has an amended credit facility that consists of a $21.2 million term loan and a revolving credit facility that currently allows borrowing of up to $203.8 million with an accordion feature that permits the Company to request an increase in availability of up to an additional $50.0 million. Outstanding borrowings accrue interest, which is paid monthly, at a rate of the one-month London Interbank Offered Rate ("LIBOR") plus a margin ranging from 1.50% to 2.25% depending on the Company's leverage ratio. At April 30, 2017 and 2016, the interest rate was 2.73% and 2.06%, respectively, and the average interest rate paid during the fiscal year ended April 30, 2017 was 2.31%. A commitment fee is paid monthly that varies from 0.25% to 0.50% depending on the Company's leverage ratio on the unused portion of the credit facility. The indebtedness is collateralized by substantially all the assets of the Company and both loans mature on April 30, 2019 (except as to the commitments of one smaller lender under the revolving credit facility, which mature on September 30, 2017).

The credit facility contains certain financial covenants that the Company must meet, including leverage and fixed-charge coverage ratios as well as minimum net worth requirements. In addition, the Company must reduce the outstanding balance under its revolving loan to zero for a period of at least 45 consecutive days each fiscal year. The Company's borrowing availability on the credit facility at April 30, 2017 was $108.0 million. At April 30, 2017 and 2016, the Company had no outstanding borrowings under its revolving credit facility. The Company was in compliance with the financial covenants of its credit facility at April 30, 2017.

The credit facility also contains certain events of default that may cause the bank syndicate to terminate the credit facility and declare amounts owed to become immediately payable if they occur. At April 30, 2017, the Company has not incurred an event of default.

Debt at April 30, 2017 and 2016 was as follows:

	2017		2016
	(In thousands)
Term loan payable in quarterly principal installments of 2.50%, and 3.13% of the original amount borrowed for the years ending April 30, 2018 and 2019, respectively; on April 30, 2019 a balloon payment of $13,016 is payable.	$	17,471	$	18,884
Mortgage note payable to a bank in monthly installments ranging from $10 to $14 including interest at LIBOR plus 1.85%, which was 2.84% at April 30, 2017, through December 1, 2026; at that time a balloon payment of $779 is payable; subject to a prepayment penalty; collateralized by land and building.	2,160		—
Mortgage note payable to a bank in monthly installments of $16 including interest at 6.06% through September 2016; at that time a balloon payment of $2,213 is payable; subject to a prepayment penalty; collateralized by land and building.	—		2,230
Amounts due to former ADs, franchisees and third parties at zero percent interest; due May 2017 through April 2020.	6,568		2,317
Other debt	—		9
Total long-term obligations	26,199		23,440
Less current installments	7,738		5,947
Total long-term obligations, less current installments	$	18,461	$	17,493

F-23

As discussed in Note 1, the adoption of ASU 2015-03 and ASU 2015-15 resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's borrowings from other assets to long-term obligations within our consolidated balance sheet for each period ended April 30, 2017 and 2016, respectively.

Aggregate maturities of long-term debt at April 30, 2017 were as follows (in thousands):

Year ending April 30:
2018	$	7,738
2019	16,510
2020	171
2021	136
2022	140
Thereafter	1,504
Total long-term debt	$	26,199

(8) Derivative Instruments and Hedging Activities

From time to time, the Company uses interest-rate-related derivative financial instruments to manage its exposure related to changes in interest rates on its variable-rate line of credit and forward contracts to manage its exposure to foreign currency fluctuation related to short-term advances made to its Canadian subsidiary. The Company does not speculate using derivative instruments nor does it enter into derivative instruments for any purpose other than cash flow hedging.

By using derivative financial instruments to hedge exposures to changes in interest rates, the Company exposes itself to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company money, which creates credit risk for the Company. When the fair value of a derivative contract is negative, the Company owes the counterparty money, and therefore, the Company is not exposed to the counterparty's credit risk in those circumstances. The Company minimizes counterparty credit risk in derivative instruments by entering into transactions with high-quality counterparties. The derivative instruments entered into by the Company do not contain credit-risk-related contingent features.

Market risk is the adverse effect on the value of a derivative instrument that results from a change in interest rates. The market risk associated with interest rates is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.

The Company assesses interest rate risk by continually identifying and monitoring changes in interest rates that may adversely impact expected future cash flows and by evaluating hedging opportunities. The Company maintains risk management control systems to monitor interest rate risk attributable to both the Company's outstanding or forecasted debt obligations and forecasted revenues as well as the Company's offsetting hedge positions. The risk management control systems involve the use of analytical techniques, including cash flow sensitivity analysis, to estimate the expected impact of changes in interest rates and foreign currency rates on the Company's future cash flows.

Interest rate swap agreements. In December 2016, in connection with obtaining a mortgage payable to a bank, the Company entered into an interest rate swap agreement, with a notional amount of $2.2 million, equal to the mortgage amount, that allows it to manage fluctuations in cash flow resulting from changes in the interest rate on the mortgage. This swap effectively changes the variable-rate of the Company's mortgage into a fixed rate of 4.12%.The Company has designated this swap agreement as a cash flow hedge. At April 30, 2017, the fair value of the interest rate swap is less than $0.1 million and is included in "Accounts payable and accrued expenses" on the accompanying consolidated balance sheets. The interest rate swap expires in December 2026.

Forward contracts related to foreign currency exchange rates. In connection with short-term advances made to its Canadian subsidiary related to personal income tax refund discounting, the Company enters into forward contracts to eliminate the exposure related to foreign currency fluctuations. Under the terms of the forward currency contracts, the exchange rate for repayments is fixed at the time advance is made and the advances are repaid prior to April 30 of each year. These forward contracts are designated as cash flow hedges. At April 30, 2017 and 2016, there were no remaining forward contracts

F-24

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

outstanding. During the years ended April 30, 2017, 2016, and 2015, these foreign currency hedges were effective and, therefore, no amounts were recognized in the consolidated statements of income.

At April 30, 2017, there were no deferred gains related to forward contracts for foreign currency exchange rates accumulated in other comprehensive income.

(9) Stockholders' Equity

Preferred Stock and Exchangeable Shares

The Company has 190,000 shares of authorized Class A preferred stock with a par value of $0.01, of which none were issued and outstanding at April 30, 2017 and 2016.

The Company also has 10 shares of special voting preferred stock authorized, issued and outstanding with a par value of $0.01 and no liquidation value. Each share of special voting preferred stock entitles the holder to vote as if it represents 100,000 shares of Class A common stock. In conjunction with the special voting preferred stock, there are 1,000,000 exchangeable shares with a par value of $0.01 that are exchangeable at any time into an equal number of shares of Class A common stock of the Company. The special voting preferred stock will be canceled at the time the holder exchanges the exchangeable shares.

Common Stock

The Company is authorized to issue 21,200,000 shares of Class A common stock, par value $0.01 per share, and 1,000,000 shares of Class B common stock, par value $0.01 per share. Class A common stock and Class B common stock entitle the holders to the same rights and privileges and are identical in all respects as to all matters, except the holders of Class B common stock are entitled to elect one more director than the number of directors elected by holders of all other classes of stock combined. Additionally, a holder of Class B common stock may, at the holder's option, elect to convert the Class B common stock into an equal number of fully paid and non-assessable shares of Class A common stock.

Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive loss at April 30, 2017 and 2016 are as follows.

	2017			2016
	(In thousands)
Foreign currency adjustment	$	(2,059	)	$	(1,148	)
Unrealized loss on equity securities available for sale, net of taxes	30			(550		)
Gain on sale of available-for-sale securities, net of taxes	(30		)	—
Interest rate swap agreements, net of tax	(25		)	—
Total accumulated other comprehensive loss	$	(2,084	)	$	(1,698	)

Net Income per Share

Net income per share of Class A and Class B common stock is computed using the two-class method. Basic net income per share is computed by allocating undistributed earnings to common shares and participating securities (Class A preferred stock and exchangeable shares) and using the weighted-average number of common shares outstanding during the period. Undistributed losses are not allocated to participating securities because they do not meet the required criteria for such allocation.

Diluted net income per share is computed using the weighted-average number of common shares and, if dilutive, the potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and vesting of restricted stock units. The dilutive effect of outstanding stock options and restricted stock units is reflected in dilutive earnings per share by application of the treasury stock method. Additionally, the computation of diluted net income per share of Class A common stock assumes the conversion of Class B common stock and exchangeable shares, if dilutive, while the diluted net income per share of Class B common stock does not assume conversion of those shares.

F-25

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

The rights, including liquidation and dividend rights, of the holders of Class A and Class B common stock are identical, with the exception of the election of directors. As a result, the undistributed earnings for each year are allocated based on the contractual participation rights of the Class A and Class B common stock as if the earnings for the year had been distributed. Participating securities have dividend rights that are identical to Class A and Class B common stock.

The computation of basic and diluted net income per share for the years ended April 30, 2017, 2016, and 2015 is as follows.

	2017
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	12,745		$	268
Amounts allocated to participating securities:
Exchangeable shares	(917		)	(19		)
Net income attributable to common stockholders	$	11,828		$	249
Denominator:
Weighted-average common shares outstanding	12,630,356			265,205
Basic net income per share	$	0.94		$	0.94
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	11,828		$	249
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	249			—
Exchangeable shares to Class A common stock	936			—
Net income attributable to stockholders	$	13,013		$	249
Denominator:
Number of shares used in basic computation	12,630,356			265,205
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	265,205			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	21,347			407
Weighted-average diluted shares outstanding	13,916,908			265,612
Diluted net income per share	$	0.94		$	0.94

F-26

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

	2016
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	18,056		$	1,364
Amounts allocated to participating securities:
Exchangeable shares	(1,307		)	(99		)
Net income attributable to common stockholders	$	16,749		$	1,265
Denominator:
Weighted-average common shares outstanding	11,914,775			900,000
Basic net income per share	$	1.41		$	1.41
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	16,749		$	1,265
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	1,265			—
Exchangeable shares to Class A common stock	1,406			—
Net income attributable to stockholders	$	19,420		$	1,265
Denominator:
Number of shares used in basic computation	11,914,775			900,000
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	900,000			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	209,896			13,674
Weighted-average diluted shares outstanding	14,024,671			913,674
Diluted net income per share	$	1.38		$	1.38

F-27

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

	2015
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	8,076		$	614
Amounts allocated to participating securities:
Exchangeable shares	(588		)	(45		)
Net income attributable to common stockholders	$	7,488		$	569
Denominator:
Weighted-average common shares outstanding	11,838,887			900,000
Basic net income per share	$	0.63		$	0.63
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	7,488		$	569
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	569			—
Exchangeable shares to Class A common stock	633			—
Net income attributable to stockholders	$	8,690		$	569
Denominator:
Number of shares used in basic computation	11,838,887			900,000
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	900,000			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	555,886			36,415
Weighted-average diluted shares outstanding	14,294,773			936,415
Diluted net income per share	$	0.61		$	0.61

Diluted net income per share excludes the impact of shares of potential common stock from the exercise of options and vesting of restricted stock units to purchase 1,320,162, 429,644 and 210,416 shares for the years ended April 30, 2017, 2016, and 2015, respectively, because the effect would be anti-dilutive.

(10) Stock Compensation Plan

Stock Options

In August 2011, the Board of Directors approved the JTH Holding, Inc. 2011 Equity and Cash Incentive Plan. Employees and outside directors are eligible to receive awards and a total of 2,500,000 shares of Class A common stock were authorized for grant under the plan. At April 30, 2017, 1,082,412 shares of Class A common stock remained available for grant.

F-28

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

The following table summarizes the information for options granted in the years ended April 30, 2017, 2016, and 2015.

	2017	2016	2015
Weighted-average fair value of options granted	$2.45	$5.05	$9.59
Dividend yield	5.0% - 6.1%	2.8% - 3.7%	0.0% - 2.2%
Expected volatility	32.8% - 35.4%	32.4% - 35.6%	31.1% - 31.7%
Expected terms	5 - 6 years	4 - 6 years	5 years
Risk-free interest rates	1.2% - 2.1%	1.4% - 1.7%	1.6% - 1.9%

The Company does not have enough public trading history to calculate volatility for the term of the granted options, therefore, it used a 75/25 weighted-average volatility, weighing our public trading history and that of other public companies in the tax preparation industry.

The grants made prior to June 2012 were made prior to our becoming a public company; therefore, we considered appropriate accounting literature regarding the valuation of privately-held company equity securities and determined that the values established in private transactions provided a reasonable basis for establishing the fair value for stock compensation expense purposes. On this basis, we did not obtain any third party valuation or utilize other valuation methods. Any grants made after we became a public company were valued using the closing market price of the preceding business day.

Stock option activity during the years ended April 30, 2017, 2016, and 2015 was as follows:

	Number of options		Weighted average exercise price
Outstanding at April 30, 2014	1,940,406		$	16.68
Granted	170,416		32.87
Exercised	(761,913	)	15.73
Forfeited or expired	(5,350	)	15.00
Outstanding at April 30, 2015	1,343,559		19.28
Granted	227,387		22.30
Exercised	(154,594	)	14.79
Forfeited or expired	(151,790	)	24.31
Outstanding at April 30, 2016	1,264,562		19.77
Granted	512,119		12.61
Exercised	—		—
Forfeited or expired	(389,350	)	16.59
Outstanding at April 30, 2017	1,387,331		$	18.02

Intrinsic value is defined as the fair value of the stock less the cost to exercise. There were no exercises of options in fiscal 2017, the total intrinsic value of options exercised was $0.9 million and $13.3 million during the years ended April 30, 2016 and 2015, respectively. The total intrinsic value of stock options outstanding at April 30, 2017 was $0.7 million. Outstanding options have vesting terms that range from six months to six years from the date of grant and expire from four to five years after the vesting date.

F-29

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Nonvested stock options (options that had not vested in the period reported) activity during the years ended April 30, 2017, 2016, and 2015 was as follows:

	Nonvested options		Weighted average exercise price
Outstanding at April 30, 2014	485,000		$	20.92
Granted	170,416		32.87
Vested	(270,000	)	18.99
Forfeited	—		—
Outstanding at April 30, 2015	385,416		27.56
Granted	227,387		22.30
Vested	(173,750	)	25.16
Forfeited	(50,000	)	33.79
Outstanding at April 30, 2016	389,053		24.76
Granted	512,119		12.61
Vested	(223,054	)	23.88
Forfeited	—		—
Outstanding at April 30, 2017	678,118		$	15.88

At April 30, 2017, unrecognized compensation cost related to non-vested stock options was $2.0 million. These costs are expected to be expensed through fiscal 2021.

The following table summarizes information about stock options outstanding and exercisable at April 30, 2017.

	Options outstanding				Options exercisable
Range of Exercise Prices	Number of options outstanding	Weighted average exercise price		Weighted average remaining contractual life (in years)	Number of options exercisable	Weighted average exercise price
10.51 to 15.00	706,712	$	13.27	4.7	194,593	$	15.00
16.38 - 19.75	284,816	17.93		3.0	266,816	17.96
22.18 - 29.48	330,387	25.22		4.5	212,387	25.15
33.38	65,416	33.38		4.5	35,417	33.38
	1,387,331	$	18.02		709,213	$	20.07

Restricted Stock Units

The Company has awarded restricted stock units to its non-employee directors and certain employees. Restricted stock units are valued at the closing stock price the day preceding the grant date. Compensation costs associated with these restricted shares are amortized on a straight-line basis over the vesting period and recognized as an increase in additional paid-in capital. At April 30, 2017, unrecognized compensation cost related to restricted stock units was $2.0 million. These costs are expected to be recognized through fiscal 2022.

F-30

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Restricted stock activity during the years ended April 30, 2017, 2016 and 2015 was as follows.

	Number of RSUs		Weighted Average Fair Value at Grant Date
Balance at April 30, 2014	21,445		$	16.87
Granted	25,691		33.38
Vested	(14,746	)	16.38
Forfeited	(3,461	)	26.47
Balance at April 30, 2015	28,929		30.63
Granted	32,056		23.06
Vested	(13,394	)	27.99
Forfeited	(4,799	)	27.89
Balance at April 30, 2016	42,792		26.10
Granted	165,454		12.62
Vested	(17,118	)	24.58
Forfeited	(14,732	)	25.94
Balance at April 30, 2017	176,396		$	13.61

(11) Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities subject to fair value measurements are classified according to a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. Valuation methodologies for the fair value hierarchy are as follows.

• Level 1—Quoted prices for identical assets and liabilities in active markets.

• Level 2—Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-based valuations in which all significant inputs are observable in the market.

• Level 3—Unobservable inputs in which little or no market data exists, therefore, requiring an entity to develop its own assumptions.

The Company measures or monitors certain of its assets and liabilities on a fair value basis. Fair value is used on a recurring basis for those assets and liabilities for which fair value is the primary basis of accounting. Other assets and liabilities are measured at fair value on a nonrecurring basis; that is, they are subject to fair value adjustment in certain circumstances, such as when there is evidence of impairment.

F-31

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

The following tables present, for each of the fair value hierarchy levels, the assets and liabilities that are measured at fair value on a recurring and nonrecurring basis at April 30, 2017 and 2016.

			April 30, 2017 Fair value measurements using
	Total		Level 1		Level 2		Level 3
	(In thousands)
Recurring assets:
Cash equivalents	$	10,393	$	10,393	$	—	$	—
Total recurring assets	10,393		10,393		—		—
Nonrecurring assets:
Impaired accounts and notes receivable, net of unearned revenue	16,500		—		—		16,500
Impaired goodwill	94		—		—		94
Impaired customer lists	18		—		—		18
Assets held for sale	11,989		—		—		11,989
Total nonrecurring assets	28,601		—		—		28,601
Total recurring and nonrecurring assets	$	38,994	$	10,393	$	—	$	28,601
Recurring liabilities
Contingent consideration included in obligations due former ADs, franchisees and others	3,215		—		—		3,215
Total recurring liabilities	$	3,215	$	—	$	—	$	3,215

			April 30, 2016 Fair value measurements using
	Total		Level 1		Level 2		Level 3
	(In thousands)
Recurring assets:
Cash equivalents	$	7,140	$	7,140	$	—	$	—
Available-for-sale securities	4,123		4,123		—		—
Total recurring assets	11,263		11,263		—		—
Nonrecurring assets:
Impaired accounts and notes receivable, net of unearned revenue	12,256		—		—		12,256
Impaired goodwill	63		—		—		63
Impaired reacquired rights	28		—		—		28
Impaired customer lists	34		—		—		34
Assets held for sale	9,886		—		—		9,886
Total nonrecurring assets	22,267		—		—		22,267
Total recurring and nonrecurring assets	$	33,530	$	11,263	$	—	$	22,267

The Company's policy is to recognize transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer. There were no transfers into or out of Level 1 or 2 recurring fair value measurements for the years ended April 30, 2017 and 2016.

The following methods and assumptions are used to estimate the fair value of our financial instruments.

Cash equivalents: The carrying amounts approximate fair value because of the short maturity of these instruments. Cash equivalent financial instruments consist of money market accounts.

F-32

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Impaired accounts and notes receivable: Accounts and notes receivable are considered to be impaired if the net amounts due exceed the fair value of the underlying franchise or if management considers it probable that all principal and interest will not be collected when contractually due. In establishing the estimated fair value of the underlying franchise, consideration is given to a variety of factors, including, recent comparable sales of Company-owned stores, sales between franchisees, the net fees of open offices, and the number of unopened offices.

Impaired goodwill, reacquired rights, and customer lists: Goodwill, reacquired rights, and customer lists associated with a Company-owned office are considered to be impaired if the net carrying amount exceeds the fair value of the underlying office. In establishing the fair value of the underlying office, consideration is given to the related net fees, subjected to a floor of the value of a new franchise.

Assets held for sale: Assets held for sale are recorded at the lower of the carrying value or the expected sales price, less costs to sell, which approximates fair value. The expected sales price is generally calculated as a percentage of the prior year's net fees.

Contingent consideration included in long-term obligations: Contingent consideration is carried at fair value. The fair value of these obligations was determined based upon the estimated future net revenues of the acquired businesses.

Other Fair Value Measurements

Accounting standards require the disclosure of the estimated fair value of financial instruments that are not recorded at fair value. For the financial instruments not recorded at fair value, estimates of fair value are made at a point in time based on relevant market data and information about the financial instrument. No readily available market exists for a significant portion of the Company's financial instruments. Fair value estimates for these instruments are based on current economic conditions, interest rate risk characteristics, and other factors. Many of these estimates involve uncertainties and matters of significant judgment and cannot be determined with precision. Therefore, the calculated fair value estimates in many instances cannot be substantiated by comparison to independent markets and, in many cases, may not be realizable in a current sale of the instrument. In addition, changes in assumptions could significantly affect these fair value estimates. The following methods and assumptions were used by the Company in estimating the fair value of these financial instruments.

Receivables other than notes, other current assets, accounts payable and accrued expenses, and due to ADs: The carrying amounts approximate fair value because of the short maturity of these instruments (Level 1).

Notes receivable: The carrying amount approximates fair value because the interest rate charged by the Company on these notes approximates rates currently offered by local lending institutions for loans of similar terms to individuals/entities with comparable credit risk (Level 3).

Long-term debt: The carrying amount approximates fair value because the interest rate paid has a variable component (Level 2).

(12) Employee 401(k) Plan

The Company sponsors a defined-contribution 401(k) profit sharing plan. Under the plan, employees who are 18 years of age and have completed 90 days of service are eligible to make voluntary contributions to the plan. The Company matches 50% of each employee's contribution up to 3% of the employee's salary. Total compensation expense related to these contributions was $0.5 million for each of the three years ended April 30, 2017, 2016, and 2015.

(13) Income Taxes

Management makes an assessment to determine if its deferred tax assets are more likely than not to be realized.  State tax carry-forwards and net operating losses of $0.1 million expire from 2017 to 2036.

We operate in multiple taxing jurisdictions within the U.S. and Canada and are subject to examination from various tax authorities. The liability for unrecognized tax expense included less than $100,000 of accrued interest as of April 30, 2017.  If recognized, this liability would impact the effective tax rate.

F-33

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Interest incurred from income taxes is recognized as incurred and recorded as income tax expense on the consolidated statements of income. Penalties are recognized as incurred and recorded as nondeductible penalties expense and included in general and administrative expense on the consolidated statements of income.

Total income taxes were calculated for the years ended April 30, 2017, 2016, and 2015 as follows.

	2017		2016			2015
	(In thousands)
Income tax expense	$	7,754	$	11,058		$	4,811
Tax impact of stock option activity	378		(900		)	(4,803		)
Unrealized gain (loss) on available-for-sale securities	—		(326		)	—
Total income taxes	$	8,132	$	9,832		$	8

Components of income tax expense for the years ended April 30, 2017, 2016, and 2015 were as follows.

	2017			2016			2015
	(In thousands)
Current:
Federal	$	6,125		$	2,748		$	5,973
State	1,160			598			2,157
Foreign	293			328			226
Current tax expense	7,578			3,674			8,356
Deferred:
Federal	315			6,079			(2,629		)
State	(183		)	1,322			(950		)
Foreign	44			(17		)	34
Deferred tax expense (benefit)	176			7,384			(3,545		)
Total income tax expense	$	7,754		$	11,058		$	4,811

For the years ended April 30, 2017, 2016, and 2015, income before taxes consisted of the following.

	2017		2016		2015
	(In thousands)
U.S. operations	$	19,558	$	28,954	$	12,459
Foreign operations	1,209		1,524		1,042
Income before income taxes	$	20,767	$	30,478	$	13,501

F-34

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

Income tax expense differed from the amounts computed by applying the U.S. federal income tax rate of 35% to pretax income from continuing operations as a result of the following for the years ended April 30, 2017, 2016, and 2015.

	2017			2016			2015
	(In thousands)
Computed "expected" income tax expense	$	7,269		$	10,667		$	4,725
Increase (decrease) in income taxes resulting from:
State income taxes, net of federal benefit	634			1,126			1,034
Nondeductible expenses	211			246			308
Tax credits	(140		)	(370		)	(251		)
Domestic production deduction	(158		)	(538		)	(466		)
Stock compensation expense	58			31			(378		)
Foreign tax rate differential	(86		)	(222		)	(104		)
Rate change	(64		)	—			18
Other	30			118			(75		)
Total income tax expense	$	7,754		$	11,058		$	4,811

The tax effect of temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities that give rise to significant portions of deferred tax assets and liabilities at April 30, 2017 and 2016 are as follows:

	2017			2016
	(In thousands)
Deferred tax assets:
Deferred revenue	$	11,286		$	1,236
Allowance for doubtful accounts	5,136			3,707
Goodwill, intangible assets, and assets held for sale	3,140			—
Unexercised nonqualified stock options	2,260			2,292
Accounts payable and accrued expense	1,954			594
Net operating loss	148			—
Total deferred tax assets	23,924			7,829
Deferred tax liabilities:
Property, equipment and software	12,916			10,285
Section 481(a) adjustment - change in accounting method	11,729			—
Intangible assets	2,048			—
Other current assets	505			370
Deferred contingencies	137			—
Total deferred tax liabilities	27,335			10,655
Net deferred tax liability	$	(3,411	)	$	(2,826	)

In assessing the realizability of the gross deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that the benefits of these deductible differences will be realized.

The Company has adopted the accounting and disclosure requirements for uncertain tax positions, which require a two-step approach to evaluate tax positions. This approach involves recognizing any tax positions that are more likely than not to

F-35

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

occur and then measuring those positions to determine the amounts to be recognized in the financial statements. The Company has determined no reserves for uncertain tax positions were required at April 30, 2017 or 2016.

Foreign subsidiary net earnings that were considered permanently reinvested were $1.2 million, $1.5 million, and $1.0 million for the fiscal years ended April 30, 2017, 2016, and 2015, respectively. Because these foreign subsidiary net earnings are considered permanently reinvested, the amount of deferred tax liability that would need to be provided if these earnings were not reinvested is not reasonably determinable.

We are currently being audited in two tax jurisdictions and remain subject to examination until the statute of limitations expires for the respective tax jurisdictions. We currently do not believe that our open audit will result in an amount due. At April 30, 2017, the tax years that remain subject to examination by the Internal Revenue Service and other major taxing jurisdictions relate to the fiscal years ended April 30, 2016, 2015, and 2014.

(14) Related Party Transactions

The Company considers directors and their affiliated companies as well as executive officers and their immediate family to be related parties. For the years ended April 30, 2017, 2016, and 2015, the Company repurchased common stock from related parties as follows.

	2017		2016		2015
	(In thousands)
Common stock:
Shares repurchased	30		—		1,007
Amount	$	378	$	—	$	26,954

During fiscal 2015, the Company entered into a multi-year contract to purchase a license for the use of Canadian tax software at a price of $0.7 million from a company in which it has an investment accounted for under the equity method. One of the members of the Company's Board of Directors is affiliated with the company providing this service. This contract expired during the second quarter of fiscal 2017. At that same time, the Company entered into a new three year contract with the same company at a price of $0.9 million.

(15) Commitments and Contingencies

In the ordinary course of operations, the Company may become a party to legal proceedings. Based upon information currently available, management believes that such legal proceedings, individually or in the aggregate, will not have a material adverse effect on the Company's business, financial condition, cash flows, or results of operations except as provided below.

JTH Tax, Inc. and SiempreTax LLC v. Gregory Aime, Aime Consulting, LLC, Aime Consulting, Inc. and Wolf Ventures, Inc. (Case No. 2:16-cv-279). We filed suit in the United States District Court for the Eastern District of Virginia against the defendants, former Company franchisees, on June 9, 2016, as amended on June 22, 2016, claiming the defendants breached the purchase and sale agreement (the “PSA”) entered between the parties on January 21, 2016 and that the defendants had failed to comply with the post termination obligations of the franchise agreements (together with the PSA, the “Aime Agreements”). We sought damages in an amount equal to three times the defendants’ earnings and profits, as well as injunctive relief to enforce the defendants to comply with the post termination obligations of the Aime Agreements, to be determined by the trier of fact. We specifically sought, in part, to enjoin the defendants from continued operation of a tax preparation business using the our protected trademarks, enforcement of the non-compete provision of the Aime Agreements, and an order that the defendants assign all of the leases related to the franchised businesses to us. On July 1, 2016, the Magistrate Judge issued a report and recommendation finding a likelihood of success on the merits and recommending entry of the requested temporary restraining order (the “TRO”) in our favor, which was adopted in part on August 3, 2016. On September 9, 2016, the defendants filed an answer and counterclaim against us, alleging breach of the PSA, breach of the implied covenant of good faith and fair dealing and fraud and seeking approximately $2.4 million in damages, plus future loss profits, punitive damages and other expenses. After a three-day bench trial, on January 13, 2017, the court vacated the TRO, finding in favor of the defendants. On February 15, 2017, the court issued its written opinion and order granting the defendants’ breach of contract and breach of the implied covenant of good faith and fair dealing claims, denying our claims against the defendants and finding certain post termination obligations to be unenforceable. Judgment was entered in favor of the defendants for approximately $2.7 million. We have

F-36

LIBERTY TAX, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

April 30, 2017 and 2016

reserved $2.7 million in connection with the judgment, which is recorded in "Accounts payable and accrued expense" in the accompanying consolidated balance sheets. We intend to vigorously defend our position and pursue an appeal of the judgment.

The Company is also party to claims and lawsuits that are considered to be ordinary, routine litigation incidental to the business, including claims and lawsuits concerning the preparation of customers' income tax returns, the fees charged to customers for various products and services, relationships with franchisees, intellectual property disputes, employment matters, and contract disputes. Although the Company cannot provide assurance that it will ultimately prevail in each instance, it believes the amount, if any, it will be required to pay in the discharge of liabilities or settlements in these claims will not have a material adverse impact on its consolidated results of operations, financial position or cash flows. Costs incurred with defending matters are expensed as incurred.

(16) Quarterly Financial Data (Unaudited)

	Three Months Ended
	April 30, 2017		January 31, 2017		October 31, 2016			July 31, 2016
	(In thousands, except per share amounts)
Revenue	$	111,179	$	48,423	$	7,234		$	7,149
Net income (loss)	$	29,330	$	2,455	$	(9,342	)	$	(9,430	)
Weighted-average basic shares outstanding	12,882,550		12,902,577		12,901,955			12,894,740
Weighted-average dilutive shares outstanding	13,934,941		13,924,210		12,901,955			12,894,740
Net income (loss) per share of Class A and Class B common stock:
Basic	$	2.11	$	0.18	$	(0.72	)	$	(0.73	)
Diluted	$	2.10	$	0.18	$	(0.72	)	$	(0.73	)
Cash dividends declared per share of common stock and common stock equivalents	$	0.16	$	0.16	$	0.16		$	0.16

	Three Months Ended
	April 30, 2016		January 31, 2016		October 31, 2015			July 31, 2015
	(In thousands, except per share amounts)
Revenue	$	104,414	$	53,621	$	7,871		$	7,523
Net income (loss)	$	32,288	$	4,738	$	(9,070	)	$	(8,536	)
Weighted-average basic shares outstanding	12,877,919		12,795,367		12,775,565			12,811,621
Weighted-average dilutive shares outstanding	13,967,568		14,002,356		12,775,565			12,811,621
Net income (loss) per share of Class A and Class B common stock:
Basic	$	2.33	$	0.34	$	(0.71	)	$	(0.67	)
Diluted	$	2.31	$	0.34	$	(0.71	)	$	(0.67	)
Cash dividends declared per share of common stock and common stock equivalents	$	0.16	$	0.16	$	0.16		$	0.16

Because most of the Company's customers file their tax returns during the period from January through April of each year, most of the Company's revenues are earned during this period. As a result, the Company generally operates at a loss through the first eight months of the fiscal year.

(17) Subsequent Events

On June 12, 2017, the Company's Board of Directors approved a cash dividend of $0.16 per share payable on July 28, 2017 to holders of record of common stock and common stock equivalents on July 14, 2017.

F-37

F-38

EX-21.1

Exhibit 21.1

SUBSIDIARIES OF LIBERTY TAX, INC.

JTH Tax, Inc.	Delaware
JTH Financial, LLC	Virginia
Wefile, Inc.	Virginia
LTS Software, Inc.	Virginia
LTS Properties, LLC	Virginia
Liberty Tax Holding Corp.	Ontario, Canada
Liberty Tax Service Inc.	Manitoba, Canada
Employee Plus, Inc.	Virginia
JTH Tax Office Properties, LLC	Virginia
JTH New Ventures, LLC	Virginia
Hispanic Tax, LLC	Virginia
ACA Healthquest, LLC	Virginia
Unified Partners, LLC	Virginia
JTH Properties 1632, LLC	Virginia
SiempreTax LLC	Virginia
JTH Court Plaza, LLC	Virginia
JTH Financial Acquisitions LLC	Virginia
Tax Resolution LLC	Virginia
JTH Publishing LLC	Virginia
Tiger Business Services LLC	Virginia
Siempre CoStores LLC	Virginia
Liberty CoStores, LLC	Virginia
Company LT/ST Stores, LLC	Virginia

EX-23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors
Liberty Tax, Inc.:

We consent to the incorporation by reference in the registration statements (No. 333 -199579) on Form S-3 and (No. 333-182585) on Form S-8 of Liberty Tax, Inc. (formerly JTH Holding, Inc.) of our report dated July 7, 2017, with respect to the consolidated balance sheets of Liberty Tax, Inc. and subsidiaries as of April 30, 2017 and 2016, and the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended April 30, 2017, which report appears in the April 30, 2017 annual report on Form 10-K of Liberty Tax, Inc.

/s/ KPMG LLP

Norfolk, Virginia

July 7, 2017

EX-31.1

Exhibit 31.1

I, John T. Hewitt, certify that:

1.I have reviewed this annual report on Form 10-K of Liberty Tax, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 7, 2017	By:	/s/ John T. Hewitt
		John T. Hewitt
		Chief Executive Officer and Chairman of the Board
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

I, Kathleen E. Donovan, certify that:

1.I have reviewed this annual report on Form 10-K of Liberty Tax, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 7, 2017	By:	/s/ Kathleen E. Donovan
		Kathleen E. Donovan
		Chief Financial Officer
		(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Liberty Tax, Inc. (the “Company”) on Form 10-K for the fiscal year ended April 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John T. Hewitt, Chief Executive Officer and Chairman of the Board of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 7, 2017	By:	/s/ John T. Hewitt
		John T. Hewitt
		Chief Executive Officer and Chairman of the Board (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Liberty Tax, Inc. (the “Company”) on Form 10-K for the fiscal year ended April 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Kathleen E. Donovan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 7, 2017	By:	/s/ Kathleen E. Donovan
		Kathleen E. Donovan
		Chief Financial Officer
		(Principal Financial Officer)

XML

Document and Entity Information - USD ($)	12 Months Ended
	Apr. 30, 2017	Oct. 31, 2016
Document and Entity Information
Entity Registrant Name	Liberty Tax, Inc.
Entity Central Index Key	0001528930
Document Type	10-K
Document Period End Date	Apr. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--04-30
Entity Filer Category	Accelerated Filer
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Entity Common Stock, Shares Outstanding	12,682,550
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float		$ 102,079,574

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016
Current assets:
Cash and cash equivalents	$ 16,427	$ 9,906
Receivables:
Accounts receivable	54,723	49,908
Notes receivable - current	27,845	26,710
Interest receivable, net of uncollectible amounts	1,967	1,944
Allowance for doubtful accounts - current	(10,052)	(6,840)
Total current receivables, net	74,483	71,722
Assets Held for Sale_New	11,989	9,886
Assets Held for Sale	11,989	9,886
Deferred income tax asset	6,956	3,496
Other Assets, Current	5,812	5,838
Total current assets	115,667	100,848
Property, equipment, and software, net	39,789	40,957
Notes, Loans and Financing Receivable, Gross, Noncurrent	18,213	25,514
Allowance for Doubtful Accounts Receivable, Noncurrent	(1,968)	(2,010)
Accounts, Notes, Loans and Financing Receivable, Net, Noncurrent	16,245	23,504
Goodwill	8,576	4,228
Other intangible assets, net	21,224	16,270
Other assets, net	2,767	7,416
Total assets	204,268	193,223
Current liabilities:
Current installments of long-term debt	7,738	5,947
Accounts payable and accrued expenses	12,953	11,664
Due to Area Developers (ADs)	23,143	24,977
Income taxes payable	6,442	3,581
Deferred revenue - current	2,892	4,682
Total current liabilities	53,168	50,851
Long-term debt, excluding current installments	18,461	17,493
Deferred revenue - non-current	5,817	7,056
Deferred income tax liability	10,367	6,322
Total liabilities	87,813	81,722
Stockholders' equity:
Additional paid-in capital	8,371	7,153
Accumulated other comprehensive income (loss), net of taxes	(2,084)	(1,698)
Retained earnings	110,029	105,907
Stockholders' Equity Attributable to Parent	116,455	111,501
Total liabilities and stockholders' equity	204,268	193,223
Special voting preferred stock
Stockholders' equity:
Preferred stock	0	0
Class A Common stock
Stockholders' equity:
Common stock	127	120
Class B Common stock
Stockholders' equity:
Common stock	2	9
Exchangeable shares
Stockholders' equity:
Common stock	$ 10	$ 10

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016
Debt issuance costs	$ 60	$ 108
Class A Preferred stock
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Preferred stock, shares authorized	190,000	190,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Special voting preferred stock
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Preferred stock, shares authorized	10	10
Preferred stock, shares issued	10	10
Preferred stock, shares outstanding	10	10
Class A Common stock
Par value (in dollars per share)	$ 0.01	$ 0.01
Authorized shares	21,200,000	21,200,000
Common stock, shares issued	12,682,550	11,993,292
Common stock, shares outstanding	12,682,550	11,993,292
Class B Common stock
Par value (in dollars per share)	$ 0.01	$ 0.01
Authorized shares	1,000,000	1,000,000
Common stock, shares issued	200,000	900,000
Common stock, shares outstanding	200,000	900,000
Exchangeable shares
Par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares issued	1,000,000	1,000,000
Common stock, shares outstanding	1,000,000	1,000,000

XML

Consolidated Statements of Income - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Revenues:
Franchise fees	$ 2,659	$ 5,038	$ 6,246
AD fees	4,177	6,008	6,901
Royalties and advertising fees	74,291	80,274	80,469
Financial products	51,829	45,327	37,058
Interest income	12,955	13,578	14,707
Tax preparation fees, net of discounts	21,600	15,775	9,947
Other revenue	6,474	7,429	6,844
Total revenues	173,985	173,429	162,172
Operating expenses:
Employee compensation and benefits	44,615	42,882	41,079
Selling, general, and administrative expenses	58,159	43,927	40,604
AD expense	22,461	27,686	28,497
Advertising expense	11,073	16,420	18,308
Depreciation, amortization, and impairment charges	14,356	10,026	9,900
Capitalized Computer Software, Impairments	0	0	8,392
Total operating expenses	150,664	140,941	146,780
Income from operations	23,321	32,488	15,392
Other income (expense):
Foreign currency transaction loss	(47)	29	(2)
Net Realized and Unrealized Gain (Loss) on Trading Securities	50	0	0
Interest expense	(2,557)	(2,039)	(1,889)
Income before income taxes	20,767	30,478	13,501
Income tax expense	7,754	11,058	4,811
Net income	13,013	19,420	8,690
Undistributed Earnings Allocated to Participating Securities Class A Preferred Stock	(936)	(1,406)	(633)
Net Income (Loss) Available to Common Stockholders, Basic	$ 12,077	$ 18,014	$ 8,057
Earnings Per Share, Basic	$ 0.94	$ 1.41	$ 0.63
Earnings Per Share, Diluted	$ 0.94	$ 1.38	$ 0.61
Net income per share attributable to Class A and Class B common stockholders:
Weighted Average Number of Shares Outstanding, Basic	12,895,561	12,814,774	12,738,887
Weighted Average Number of Shares Outstanding, Diluted	13,916,908	14,024,671	14,294,773
Common Stock, Dividends, Per Share, Declared	$ 640.00	$ 640.00	$ 160.00

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Net income	$ 13,013	$ 19,420	$ 8,690
Interest rate swap agreements, net of taxes of $-, $-, and $268, respectively	(25)	0	0
Payments of Dividends	8,891	8,852	2,205
Unrealized gain (loss) on available-for-sale securities, net of taxes of $345, $326, and $-, respectively		(550)	0
Reclassified gain on sale of available-for-sale securities included in income, net of taxes of $20, $-, and $-, respectively	(30)	0	0
Foreign currency translation adjustment	(911)	(451)	(763)
Comprehensive income	12,627	18,419	7,927
AOCI Attributable to Parent [Member]
Net income	0	0	0
Payments of Dividends	0	0	0
Unrealized gain (loss) on available-for-sale securities, net of taxes of $345, $326, and $-, respectively	$ 580	$ (550)
Foreign currency translation adjustment			$ (763)

XML

Consolidated Statements of Comprehensive Income Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Statement of Comprehensive Income [Abstract]
Taxes on unrealized gain on AFS securities	$ 345	$ 326	$ 0
Taxes on reclassified gain on sale of AFS securities included in income	20	0	0
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax	$ 16	$ 0	$ 0

XML

Consolidated Statement of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Additional paid-in capital	Accumulated other comprehensive income (loss), net	Retained earnings	Class A Common stock	Class B Common stock	Special voting preferred stock	Exchangeable shares
Stock Issued During Period, Shares, Vesting					15	0	0
Stock Issued During Period, Shares, Conversion of Convertible Securities					$ 0	$ 0	$ 0
Balance at beginning of period (in shares) at Apr. 30, 2014					12,409	900	0	1,000
Balance at beginning of period at Apr. 30, 2014	$ 110,185	$ 9,402	$ 66	$ 100,574	$ 124	$ 9	$ 0	$ 10
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (note 10) (in shares)					762	0	0	0
Exercise of stock options	11,983	11,975	0	0	$ 8	$ 0	$ 0	$ 0
Stock Issued During Period, New Issues (in shares)					3	0	0
Stock Issued During Period, New Issues					$ 0	$ 0	$ 0
Repurchase of common stock (in shares)					(1,284)	0	0	0
Repurchase of common stock	(36,308)	(24,575)	0	(11,720)	$ (13)	$ 0	$ 0	$ 0
Stock-based compensation expense (in shares)								0
Stock-based compensation expense	2,477	2,477	0	0				$ 0
Tax benefit of stock option exercises (in shares)								0
Adjustment to Additional Paid in Capital, Income Tax Effect from Share-based Compensation, Net	4,803	4,803	0	0				$ 0
Net income (in shares)								0
Net income (As Restated)	8,690	0	0	8,690	$ 8,076	$ 614		$ 0
Cash dividends ($0.16 per share) (in shares)								0
Payments of Dividends	(2,205)	0	0	(2,205)				$ 0
Foreign currency translation (in shares)								0
Foreign currency translation adjustment	(763)	0	(763)	0				$ 0
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax	$ 0
Balance at end of period (in shares) at Apr. 30, 2015	11,905				11,905	900	0	1,000
Balance at end of period at Apr. 30, 2015	$ 98,862	4,082	(697)	95,339	$ 119	$ 9	$ 0	$ 10
Stock Issued During Period, Shares, Vesting					13	0	0
Stock Issued During Period, Shares, Conversion of Convertible Securities					$ 0	$ 0	$ 0
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (note 10) (in shares)					155	0	0	0
Exercise of stock options	2,286	2,284	0	0	$ 2	$ 0	$ 0	$ 0
Stock Issued During Period, New Issues (in shares)					2	0	0
Stock Issued During Period, New Issues					$ 0	$ 0	$ 0
Repurchase of common stock (in shares)					(82)	0	0	0
Repurchase of common stock	(1,977)	(1,976)	0	0	$ (1)	$ 0	$ 0	$ 0
Stock-based compensation expense (in shares)								0
Stock-based compensation expense	1,863	1,863	0	0				$ 0
Tax benefit of stock option exercises (in shares)								0
Adjustment to Additional Paid in Capital, Income Tax Effect from Share-based Compensation, Net	900	900	0	0				$ 0
Net income (in shares)								0
Net income (As Restated)	19,420	0	0	19,420	$ 18,056	$ 1,364		$ 0
Cash dividends ($0.16 per share) (in shares)								0
Payments of Dividends	(8,852)	0	0	(8,852)				$ 0
Foreign currency translation (in shares)								0
Foreign currency translation adjustment	(451)	0		0				$ 0
Unrealized gain (in shares)								0
Unrealized gain on available-for-sale securities, net of taxes	(550)	0	(550)	0				$ 0
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax	(550)		(550)
Balance at end of period (in shares) at Apr. 30, 2016					11,993	900	0	1,000
Balance at end of period at Apr. 30, 2016	111,501	7,153	(1,698)	105,907	$ 120	$ 9	$ 0	$ 10
Stock Issued During Period, Shares, Vesting					17	0	0
Stock Issued During Period, Shares, Conversion of Convertible Securities					$ 0	$ 0	$ 0
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (note 10) (in shares)								0
Exercise of stock options	0	0	0	0				$ 0
Stock Issued During Period, New Issues (in shares)					6	0	0
Stock Issued During Period, New Issues					$ 0	$ 0	$ 0
Repurchase of common stock (in shares)					(33)	0	0	0
Repurchase of common stock	(420)	(420)	0	0	$ 0	$ 0	$ 0	$ 0
Stock-based compensation expense (in shares)								0
Stock-based compensation expense	2,016	2,016	0	0				$ 0
Tax benefit of stock option exercises (in shares)								0
Adjustment to Additional Paid in Capital, Income Tax Effect from Share-based Compensation, Net	(378)	(378)	0	0				$ 0
Net income (in shares)								0
Net income (As Restated)	13,013	0	0	13,013	$ 12,745	$ 268		$ 0
Cash dividends ($0.16 per share) (in shares)								0
Payments of Dividends	(8,891)	0	0	(8,891)				$ 0
Foreign currency translation (in shares)								0
Foreign currency translation adjustment	(911)	0		0				$ 0
Unrealized gain (in shares)								0
Unrealized gain on available-for-sale securities, net of taxes	580	0	30	0				$ 0
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax			580
Unrealized Loss on Interest Rate Swap, Shares								0
Unrealized Loss on Interest Rate Swap, Value	(25)	0		0				$ 0
Reclassified Gain on Securities, Shares								0
Reclassified Gain on Securities, Value	(30)	0	(30)	0				$ 0
Balance at end of period (in shares) at Apr. 30, 2017					12,683	200	0	1,000
Balance at end of period at Apr. 30, 2017	$ 116,455	$ 8,371	$ (2,084)	$ 110,029	$ 127	$ 2	$ 0	$ 10
Increase (Decrease) in Stockholders' Equity
Stock Issued During Period, Shares, Conversion of Convertible Securities					700	(700)	0
Stock Issued During Period, Value, Conversion of Convertible Securities					$ 7	$ (7)	$ 0

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Consolidated Statement of Stockholders' Equity Consolidated Statement of Stockholders' Equity (Parenthetical) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Statement of Stockholders' Equity [Abstract]
Cash dividend per share	$ 0.64	$ 0.64

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Cash flows from operating activities:
Net income	$ 13,013	$ 19,420	$ 8,690
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for doubtful accounts	10,378	7,282	5,726
Depreciation and amortization	8,325	6,872	8,499
Impairment of goodwill and other intangible assets	6,031	3,154	9,793
Amortization of deferred financing costs	526	477	547
Impairment of Long-Lived Assets to be Disposed of	(387)	14	246
Share-based Compensation Related To The Equity Classified Awards	2,016	1,863	2,477
Gain on bargain purchases and sales of Company-owned offices	(1,100)	(855)	(414)
Available-for-sale Securities, Gross Realized Gain (Loss)	(50)	0	0
Equity in loss of affiliate	(11)	73	160
Deferred tax expense	129	7,384	(3,545)
Changes in:
Accounts, notes, and interest receivable and deferred revenue	(10,437)	(14,228)	(8,869)
Prepaid expenses and other assets	125	210	(2,911)
Accounts payable and accrued expenses	556	(6,238)	2,685
Due to ADs	845	2,631	8,924
Income taxes	2,487	1,758	(7,491)
Net cash provided by operating activities	32,446	29,817	24,517
Cash flows from investing activities:
Issuance of operating loans to franchisees	(94,133)	(101,552)	(93,365)
Payments received on operating loans to franchisees	89,562	89,786	88,776
Purchases of Company-owned offices, AD rights, and acquired customer lists	(10,049)	(4,787)	(8,246)
Proceeds from sale of Company-owned offices and AD rights	1,339	2,934	3,687
Purchase of available-for-sale securities	0	(4,999)	0
Proceeds from Sale of Short-term Investments	5,049	0	0
Purchases of property, equipment, and software	(5,022)	(10,692)	(11,463)
Net cash used in investing activities	(13,254)	(29,310)	(20,611)
Cash flows from financing activities:
Proceeds from the exercise of stock options	0	2,286	11,983
Repurchase of common stock	(420)	(1,977)	(36,308)
Dividends paid	(8,891)	(8,852)	(2,205)
Repayment of other long-term debt	(3,740)	(1,742)	(1,501)
Borrowings under revolving credit facility	151,400	166,232	154,633
Repayments under revolving credit facility	(151,400)	(166,232)	(154,633)
Proceeds from Issuance of Long-term Debt	2,200	0	0
Payment for debt issue costs	(35)	0	(917)
Tax benefit of stock option exercises	60	900	4,803
Net cash provided by (used in) financing activities	(12,367)	(11,814)	(28,494)
Effect of exchange rate changes on cash, net	(304)	(174)	(105)
Net increase (decrease) in cash and cash equivalents	6,521	(11,481)	(24,693)
Cash and cash equivalents at beginning of year	9,906	21,387	46,080
Cash and cash equivalents at end of year	16,427	9,906	21,387
Repayments of Amounts Due to Former ADs	$ (1,541)	$ (2,429)	$ (4,349)

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Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows - Supplemental Disclosures - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Supplemental disclosures of cash flow information:
Accrued capitalized software costs included in accounts payable	$ 2,187	$ 1,628	$ 1,467
Cash paid for taxes, net of refunds	5,058	1,025	11,160
Deferred Tax Assets, Net, Current	6,956	3,496
Accrued capitalized software costs included in accounts payable	55	407	168
During the years ended April 30, 2015, 2014, and 2013, the Company acquired certain assets from franchisees, ADs, and third parties as follows:
Fair value of assets purchased	29,732	19,726	18,310
Receivables applied, net of amounts due ADs and related deferred revenue	(10,465)	(12,050)	(6,931)
Franchisee Accounts Payable Canceled	(809)	(552)	(367)
Notes and accounts payable issued	(8,409)	(2,337)	(2,766)
Cash paid to franchisees, ADs, and third parties	10,049	4,787	8,246
During the years ended April 30, 2015, 2014, and 2013, the Company sold certain assets to franchisees and ADs as follows:
Book value of assets sold	7,555	9,585	11,469
Loss on Sale from Franchisees	(107)	(131)	(298)
Gain on sale - revenue deferred	618	1,688	2,000
Notes received	(6,727)	(8,208)	(9,484)
Cash received from franchisees and ADs	$ 1,339	$ 2,934	$ 3,687

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Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Statement of Cash Flows [Abstract]
Interest Costs Capitalized	$ 235	$ 325	$ 200

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Organization and Significant Accounting Policies - Text Blocks

12 Months Ended

Apr. 30, 2017

Accounting Policies [Abstract]

Organization and Significant Accounting Policies

Description of Business and Summary of Significant Accounting Policies

Description of Business

Liberty Tax, Inc. (the "Company"), a Delaware corporation, is a holding company engaged through its subsidiaries as a franchisor and, to a lesser degree, an operator of a system of income tax preparation offices located in the United States and Canada. The Company's principal operations are conducted through JTH Tax, Inc. (d/b/a Liberty Tax Service), the Company's largest subsidiary. Through this system of income tax preparation offices, the Company also facilitates refund-based tax settlement financial products, such as refund transfer products in the U.S. and personal income tax refund discounting in Canada. The Company also offers online tax preparation services. In fiscal 2015, the Company changed its name from JTH Holding, Inc. to Liberty Tax, Inc.

The Company provides a substantial amount of lending to its franchisees and area developers ("ADs"). The Company allows franchisees and ADs to finance a portion of the initial franchise fee and AD fee, which are paid over time. The Company also offers its franchisees working capital loans to fund their operations.

Basis of Presentation

The consolidated financial statements include the accounts of Liberty Tax, Inc. and its wholly-owned subsidiaries. Assets and liabilities of the Company's Canadian operations have been translated into U.S. dollars using the exchange rate in effect at the end of the year. Revenues and expenses have been translated using the average exchange rates in effect each month of the year. Foreign exchange transaction gains and losses are recognized when incurred. The Company consolidates any entities in which it has a controlling interest, the usual condition of which is ownership of a majority voting interest. The Company also considers for consolidation an entity in which the Company has certain interest where a controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity ("VIE"), is required to be consolidated by its primary beneficiary. The Company does not possess any ownership interests in franchisee entities; however, the Company may provide financial support to franchisee entities. Because the Company's franchise arrangements provide franchisee entities the power to direct the activities that most significantly impact their economic performance, the Company does not consider itself the primary beneficiary of any such entity that might be a VIE. Based on the results of management's analysis of potential VIEs, the Company has not consolidated any franchisee entities. The Company's maximum exposure to loss resulting from involvement with potential VIEs is attributable to accounts and notes receivables and future lease payments due from franchisees. When the Company does not have a controlling interest in an entity but exerts significant influence over the entity, the Company applies the equity method of accounting. All intercompany balances and transactions have been eliminated in consolidation.

The audited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). In the opinion of management, all adjustments necessary for a fair presentation of such financial statements in accordance with GAAP have been recorded.

Office Count

The following table shows the U.S. office activity, the number of processing centers and Canadian offices, and a breakdown of Company-owned and franchised offices for the 2017, 2016, and 2015 tax seasons.

	Tax Season
	2017		2016		2015
U.S. Office Locations:
Permanent Office Locations:
Operated during the prior tax season	3,960		3,764		3,663
Offices opened	172		453		397
Offices closed	(422	)	(257	)	(296	)
Operated during the current tax season	3,710		3,960		3,764
Seasonal Office Locations:
Operated during the prior tax season	211		262		486
Offices opened	37		127		118
Offices closed	(181	)	(178	)	(342	)
Operated during the current tax season	67		211		262
Processing Centers	46		54		43
Total U.S. Office Locations	3,823		4,225		4,069
Canada Office Locations	254		262		259
Total Office Locations	4,077		4,487		4,328
Additional Office Information:
Company-owned offices	362		310		182
Franchised offices	3,715		4,177		4,146
Total office locations	4,077		4,487		4,328

SiempreTax+, operated 159 offices during the 2017 tax season compared to 144 during the 2016 season and 57 in the 2015 season. These offices consist of second offices opened by current franchisees in territories they already owned, conversions of existing Liberty Tax offices, and offices opened in new territories.

Territory Sales

The Company sold 73, 184, and 212 new territories during fiscal 2017, 2016 and 2015, respectively. New territories include territories sold to new franchisees and additional territories sold to existing franchisees.

Significant Accounting Policies

Cash and Cash Equivalents - The Company considers all highly liquid debt instruments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents are maintained in bank deposit accounts, which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on its cash and cash equivalents balances.

Accounts Receivable - Accounts receivable are recorded at the invoiced amount net of an allowance for doubtful accounts and accrue finance charges at a 12% annual rate, compounded monthly, if unpaid after 30 days. Account balances are charged off against the allowance after all possible means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its accounts receivable.

Notes Receivable - Notes receivable are recorded less unrecognized revenue, net of an allowance for doubtful accounts. Unrecognized revenue relates to the financed portion of franchise fees and AD fees and, in the case of sales of Company-owned offices, the financed portion of gains related to such sales in each case where revenue has not yet been recognized. Interest income is accrued on the unpaid principal balance. The Company puts notes receivable on non-accrual status and provides an allowance against accrued interest if it is determined the likelihood of collecting substantially all of the note and accrued interest is not probable. Generally, payments received on notes receivable on non-accrual status are applied to the principal note balance until the note is current and then to interest income. Notes are written off against the allowance when all possible means of collection have been exhausted and the potential for recovery is considered remote.

Concentrations of credit risk - Financial instruments that could potentially subject the Company to concentrations of credit risk consist of accounts and notes receivable with its franchisees. The Company manages such risk by evaluating the financial position and value of the franchisees as well as obtaining the personal guarantee of the individual franchisees. At April 30, 2017 and 2016, there were no significant concentrations of credit risk associated with any individual franchisee or group of franchisees.

Allowance for Doubtful Accounts - The allowance for doubtful accounts includes the Company's best estimate of the amount of probable credit losses in the Company's existing accounts and notes receivable. Because the repayment of accounts and notes receivable is dependent on the performance of the underlying franchises, management estimates the amount of the allowance for doubtful accounts based on a comparison of amounts due to the estimated fair value of the underlying franchises which collateralize such receivables. Management believes the allowance is adequate to cover the Company's credit loss exposure. If the carrying amount exceeds the fair value, the receivable is considered impaired.

Available-for-sale Securities - From time to time, the Company purchases corporate equity securities that are classified as available -for-sale; changes in fair value of such securities are recognized, net of tax, in accumulated other comprehensive income in the stockholders' equity section of the balance sheet. Cash flows for the purchase and sale of these investments are classified as investing activities.

Assets Held for Sale - Assets held for sale consist of Company-owned offices that the Company intends to sell to a new or existing franchisee within one year. Assets held for sale are recorded at the lower of the carrying value or the estimated sales price, less costs to sell, and are evaluated for impairment at least annually. If in the opinion of management, the Company will not be able to sell such offices, within one year from the balance sheet date, the carrying amount is reclassified to held for use and a cumulative adjustment is recorded to depreciation and amortization expense. Additionally, in fiscal 2017, we transferred a building to assets held for sale as the building is up for sale.

Property, Equipment, and Software - Property, equipment, and software are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets, generally three to five years for computer equipment, three to seven years for software, five to seven years for furniture and fixtures, and twenty to thirty years for buildings. Leasehold improvements are amortized over the lesser of the lease term or the estimated useful lives of the assets. Certain allowable costs of software developed or obtained for internal use are capitalized and typically amortized over the estimated useful life of the software.

Goodwill - Goodwill represents the excess of costs over fair value of assets of businesses acquired. The reporting unit for the acquisition of assets from various franchisees is considered to be the franchise territory, and these assets are operated as Company-owned offices. Goodwill is not amortized, but instead tested for impairment at least annually. Goodwill is tested for impairment more frequently if events and circumstances indicate that the asset might be impaired. The Company performed its annual impairment testing as of April 30, 2017.

Revenue Recognition - The Company earns revenue from the sales of franchises and granting of AD rights. Additionally, the Company earns revenue from royalties and advertising fees and other products and services. Typically, franchise rights are granted to franchisees for a term of five years with an option to renew at no additional cost. In exchange for franchise fees and royalties and advertising fees, the Company is obligated by its franchise agreements to provide training, an operations manual, site selection guidance, tax preparation software, operational assistance, tax and technical support, the ability to perform electronic filing, and marketing and advertising. Franchise fee revenue for the sales of individual territories is recognized when the obligations of the Company to prepare the franchisee for operation are substantially complete, up to the amount of cash received.

AD rights have historically been granted for a term of ten years. The Company changed the term of new and renewal AD contracts to six years in fiscal 2015. AD fees are recognized as revenue on a straight-line basis over the initial contract term of each AD agreement with the cumulative amount of revenue recognized not to exceed the amount of cash received. Amounts due to ADs for their services under an AD agreement are expensed as the related franchise fees and royalty revenues are recognized.

Royalties and advertising fees are recognized as franchise territories generate sales. Tax return preparation fees and financial products revenue are recognized as revenue in the period the related tax return is filed for the customer. Discounts for promotional programs are recorded at the time the return is filed and are recorded as reductions to revenues.

Interest income on notes receivable is recognized based on the outstanding principal note balance less unrecognized revenue unless it is put on non-accrual status. Interest income on the unrecognized revenue portion of notes receivable is recognized when received. For accounts receivable, interest income is recognized based on the outstanding receivable balance over 30 days old, net of an allowance.

Gains on sales of Company-owned offices are recognized when cash is received. Losses on sales of Company-owned offices are recognized immediately.

Deferred Revenue - Deferred revenue represents the amount of cash received for AD fees in excess of the revenue recognized.

Derivative Instruments and Hedging Activities - The Company recognizes all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values. For derivatives designated in hedging relationships, changes in fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income to the extent the derivative is effective at offsetting the changes in cash flows being hedged until the hedged item affects earnings.

The Company only enters into a derivative contract when it intends to designate the contract as a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument's effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk; the derivative expires or is sold, terminated, or exercised; the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring; or management determines to remove the designation of the cash flow hedge.

In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is no longer probable that a forecasted transaction will occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in other comprehensive income related to the hedging relationship.

Please see "Note 8 - Derivative Instruments and Hedging Activates" for a description of the cash flow hedge the Company entered into during fiscal 2017.

The Company did not have any outstanding derivative instruments or hedging activities as of April 30, 2016.

Deferred Income Taxes - Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities, which are shown on our consolidated balance sheets, are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company has elected to classify interest charged on a tax settlement in interest expense, and accrued penalties, if any, in selling, general, and administrative expenses.

The determination of our provision for income taxes requires significant judgment, the use of estimates, and the interpretation and application of complex tax laws. Significant judgment is required in assessing the timing and amounts of deductible and taxable items.  We record unrecognized tax benefit liabilities for known or anticipated tax issues based on our analysis of whether, and the extent to which, additional taxes will be due.

Intangible Assets and Other Long-Lived Assets - Amortization on intangible assets is calculated using the straight-line method over the estimated useful lives of the assets, generally from two to ten years. Long-lived assets, such as property, equipment, and software, and other purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. Recognition and measurement of a potential impairment is performed for these assets at the lowest level where cash flows are individually identifiable. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary. Assets expected to be sold within one year are no longer depreciated or amortized. These assets are classified as held-for-sale and are presented separately in the appropriate section of the consolidated balance sheets at the lower of their carrying amount or fair value less estimated cost to sell.

Comprehensive Income - Comprehensive income consists of net income, foreign currency translation adjustments, reclassified gain on sale of available-for-sale securities, net of taxes, and the unrealized gains or losses on equity securities available for sale and derivatives determined to be cash flow hedges, net of taxes.

Advertising Expenses - Advertising costs, which consists of direct mail, radio, print media and online advertisements intended to attract new franchisees and customers, are expensed in the period incurred.

Office Closing Costs - Closed office liabilities are provided on the basis of the present value of estimated remaining non-cancellable lease payments, net of estimated subtenant income. An estimate the net lease liability using a discount rate to calculate the present value of the remaining net rent payments on closed offices. Closed office lease liabilities are paid over the lease terms associated with the closed offices, which generally have remaining terms ranging from one to seven years.

Stock-Based Compensation - The Company records the cost of its employee stock-based compensation as compensation expense in its consolidated statements of income. Compensation costs related to stock options are based on the grant-date fair value of awards using the Black-Scholes-Merton option pricing model and considering forfeitures. Compensation costs related to restricted stock units are based on the grant-date fair value and are amortized on a straight-line basis over the vesting period. For liability classified awards the Company records costs based on the fair value at the reporting date. The Company recognizes compensation costs for an equity-classified award that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award; changes in the fair value liability-classified awards are recognized as they occur. The Company reflects the excess tax benefits related to stock option exercises as additional paid-in capital on its consolidated balance sheets and as financing cash flows on its consolidated statements of cash flows.

Lease Accounting - The Company leases its store locations under operating leases. The Company recognizes minimum rent expense beginning when possession of the property is taken from the landlord. When a lease contains a predetermined fixed escalation of the minimum rent, the Company recognizes the related rent expense on a straight-line basis and records the difference between the recognized rental expense and the amounts payable under the lease as deferred rent. 

Use of Estimates

Management has made a number of estimates and assumptions related to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period to prepare these consolidated financial statements and accompanying notes in conformity with GAAP. Actual results could differ from those estimates.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.

Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers." This update will replace existing revenue recognition guidance in GAAP and requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The new standard is effective for the Company in fiscal year 2019, which begins on May 1, 2018. The standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption ("modified retrospective method"). The Company currently expects to apply the modified retrospective transition method upon adoption. The Company expects the adoption of the new guidance to change the timing of recognition of initial franchise fees and AD fees. Currently, franchise fees are generally recognized when our obligations to prepare the franchise for operation have been substantially completed and cash has been received and AD fees are recognized on the straight-line basis over the contract term not to exceed the amount of cash received. The new guidance will generally require these fees to be recognized over the term of the related franchise or AD agreements, which will impact the revenue recognized for franchise fees. The Company does not expect this new guidance to materially impact the recognition of royalty and advertising fees, financial products revenue or tax preparation fees. The Company is continuing to evaluate the impact the adoption of this new guidance will have on these and other revenue transactions, in addition to the impact on accounting policies and related disclosures.

In November 2015 the FASB issued ASU 2015-17, "Balance Sheet Classification of Deferred Taxes (Topic 740)," which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as non-current. This ASU is effective for interim and annual periods in fiscal years beginning after December 15, 2016, which means that it will be effective for the Company in the first quarter of its fiscal year beginning May 1, 2017.

In February 2016, the FASB issued ASU No. 2016-02, "Leases." This update will replace existing lease guidance in GAAP and will require lessees to recognize lease assets and lease liabilities on the balance sheet for all leases and disclose key information about leasing arrangements, such as information about variable lease payments and options to renew and terminate leases. When implemented, lessees and lessors will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The update is effective for interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently finalizing its implementation plan and evaluating the impact of the new pronouncement on its consolidated financial statements. The Company expects the adoption of this pronouncement to result in a material increase in the assets and liabilities on its consolidated balance sheets and to not have a material impact on its consolidated income statements.

In May 2016, the Company adopted Accounting Standards Update ("ASU") 2015-03, "Simplifying the Presentation of Debt Issuance Costs", which requires that debt issuance costs related to a recognized debt liability to be presented on the balance sheet as a direct deduction from the debt liability, similar to the presentation of debt premiums and discounts, and ASU 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements", which further clarifies the presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-03 and ASU 2015-15 applies retrospectively and does not change the recognition and measurement requirements for debt issuance costs. The adoption of ASU 2015-03 and ASU 2015-15 resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's borrowings from other assets to long-term obligations within our consolidated balance sheet as of January 31, 2017, April 30, 2016 and January 31, 2016, respectively.

In May 2016, the Company adopted ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis", which effectively eliminates the presumption that a general partner should consolidate a limited partnership, modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIE"s) or voting interest entities, and affects the consolidation analysis of reporting entities that are involved with VIEs (particularly those that have fee arrangements and related party relationships). The Company has completed its evaluation and has concluded there is no material impact from the adoption of the new standard on its consolidated financial statements.

In March 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-09, "Improvements to Employee Share Based Payment Accounting (Topic 718)", to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard will be effective for the Company beginning with its first quarterly filing in fiscal year 2018. Early adoption is permitted, including adoption in an interim period prior to fiscal 2018. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230)", which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. The update is intended to reduce the existing diversity in practice and is effective for the Company beginning with its first quarterly filing in fiscal year 2019. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, "Measurement of Credit Losses on Financial Instruments", which changes how companies will measure credit losses for most financial assets and certain other instruments that aren't measured at fair value through net income. The standard replaces the "incurred loss" approach with an "expected loss" model for instruments measured at amortized cost (which generally will result in the earlier recognition of allowances for losses) and requires companies to record allowances for available-for-sale debt securities, rather than reduce the carrying amount. In addition, companies will have to disclose significantly more information, including information used to track credit quality by year of origination, for most financing receivables. The ASU should be applied as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the standard is effective. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods therein. The ASU is effective for the Company beginning in the first quarter of fiscal year 2021. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” This new standard eliminates Step 2 from the goodwill impairment test. Instead, an entity should compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The standard will be effective for the Company in the first quarter of our fiscal year 2021. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

Segment Reporting

Management has identified two operating segments, U.S. operations and Canadian operations. Although there are two operating segments, each segment is engaged in providing tax return preparation and related services and products. These two operating segments, which have similar gross margin and sales trends, have been aggregated into a single reporting segment because both segments are similar in the nature of services offered, production process, type of customer, the distribution methods, and the regulatory environment in which they operate. Canadian operations contributed $7.0 million, $7.0 million, and $6.9 million in revenues for the years ended April 30, 2017, 2016, and 2015, respectively.

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Accounts and Notes Receivable - Text Blocks

12 Months Ended

Apr. 30, 2017

Receivables [Abstract]

Notes and Accounts Receivable

Notes and Accounts Receivable

The Company provides financing to franchisees and ADs for the purchase of franchises, areas and Company-owned offices, and operating loans for working capital and equipment needs. The franchise-related notes generally are payable over five years and the operating loans generally are due within one year. Most notes bear interest at 12%.

Notes and interest receivable, net of unrecognized revenue, as of April 30, 2017 and 2016 are presented in the consolidated balance sheets as follows:

	2017		2016
	(In thousands)
Notes receivable - current	$	27,845	$	26,710
Notes receivable - non-current	18,213		25,514
Interest receivable, net of uncollectible amounts	1,967		1,944
Total notes and interest receivable, net of unrecognized revenue	$	48,025	$	54,168

Most of the notes receivable are due from the Company's franchisees and ADs and are collateralized by the underlying franchise and, when the franchise or AD is an entity, are guaranteed by the owners of the respective entity. The debtors' ability to repay the notes is dependent upon both the performance of the tax preparation industry as a whole and the individual franchisees' or ADs' areas.

The table above does not include unrecognized revenue. Unrecognized revenue relates to the financed portion of franchise fees and AD fees and, in the case of sales of Company-owned offices, the financed portion of gains related to these sales in each case where revenue has not yet been recognized. For franchise fees and gains related to the sale of Company-owned offices, revenue is recorded as note payments are received by the Company. Payments on AD fee notes receivable generate a corresponding increase in deferred revenue, which is amortized into revenue over the life of the AD contract. In fiscal 2015 the Company changed the term of new and renewal AD contracts to six years from ten years and the revenue for these contracts will be recognized over that period, subject to the receipt of cash. Unrecognized revenue was $29.4 million and $35.2 million at April 30, 2017 and 2016, respectively.

Allowance for Doubtful Accounts

The adequacy of the allowance for doubtful accounts is assessed on a quarterly basis and adjusted as deemed necessary. Management believes the recorded allowance is adequate based upon its consideration of the estimated value of the franchises and AD areas, which collateralize the receivables. Any adverse change in the tax preparation industry or the individual franchisees' or ADs' areas could affect the Company's estimate of the allowance.

Activity in the allowance for doubtful accounts for the years ended April 30, 2017, 2016, and 2015 was as follows.

	2017			2016			2015
	(In thousands)
Balance at beginning of year	$	8,850		$	7,355		$	6,850
Provision for doubtful accounts	10,378			7,282			5,726
Write-offs	(7,119		)	(5,737		)	(5,122		)
Foreign currency adjustment	(89		)	(50		)	(99		)
Balance at end of year	$	12,020		$	8,850		$	7,355

Management considers specific accounts and notes receivable to be impaired if the net amounts due exceed the fair value of the underlying franchise at the time of the annual valuation and estimates an allowance for doubtful accounts based on that excess. While not specifically identifiable as of the balance sheet date, the Company's experience also indicates that a portion of other accounts and notes receivable are also impaired, because management does not expect to collect all principal and interest due under the current contractual terms. Net amounts due include contractually obligated accounts and notes receivable plus accrued interest, net of unrecognized revenue, reduced by the allowance for uncollected interest, amounts due ADs, related deferred revenue, and amounts owed to the franchisee by the Company. In establishing the fair value of the underlying franchise, management considers a variety of factors including recent sales of Company-owned stores, recent sales between franchisees, net fees of open offices earned during the most recently completed tax season, and the number of unopened offices.

The allowance for doubtful accounts at April 30, 2017 and 2016 was allocated as follows.

	2017			2016
	(In thousands)
Impaired:
Accounts receivable	$	11,396		$	7,083
Notes and interest receivable, net of unrecognized revenue	14,646			12,960
Less amounts due to ADs and franchisees	(1,834		)	(1,426		)
Amounts receivable less amounts due to ADs and franchisees	$	24,208		$	18,617
Allowance for doubtful accounts for impaired accounts and notes receivable	$	9,542		$	7,787
Non-impaired:
Accounts receivable	$	43,327		$	42,825
Notes and interest receivable, net of unrecognized revenue	33,379			41,208
Less amounts due to ADs and franchisees	(23,119		)	(26,183		)
Amounts receivable less amounts due to ADs and franchisees	$	53,587		$	57,850
Allowance for doubtful accounts for non-impaired accounts and notes receivable	$	2,478		$	1,063
Total:
Accounts receivable	$	54,723		$	49,908
Notes and interest receivable, net of unrecognized revenue	48,025			54,168
Less amounts due to ADs and franchisees	(24,953		)	(27,609		)
Amounts receivable less amounts due to ADs and franchisees	$	77,795		$	76,467
Total allowance for doubtful accounts	$	12,020		$	8,850

The Company's average investment in impaired notes receivable during the fiscal years ended April 30, 2017, 2016, and 2015 was $11.3 million, $9.0 million, and $7.9 million, respectively. Interest income recognized related to performing impaired notes was $1.2 million, $0.9 million, and $0.7 million for the fiscal years ended April 30, 2017, 2016, and 2015, respectively.

Analysis of Past Due Receivables

The breakdown of accounts and notes receivable past due at April 30, 2017 and 2016 was as follows.

	2017
	Past due		Current		Interest receivable, net		Total receivables
	(In thousands)
Accounts receivable	$	28,892	$	25,831	$	—	$	54,723
Notes and interest receivable, net	7,034		39,024		1,967		48,025
Total accounts, notes, and interest receivable, net	$	35,926	$	64,855	$	1,967	$	102,748

	2016
	Past due		Current		Interest receivable, net		Total receivables
	(In thousands)
Accounts receivable	$	24,712	$	25,196	$	—	$	49,908
Notes and interest receivable, net	6,142		46,082		1,944		54,168
Total accounts, notes, and interest receivable, net	$	30,854	$	71,278	$	1,944	$	104,076

Accounts receivable are considered to be past due if unpaid 30 days after billing and notes receivable are considered past due if unpaid 90 days after due date. If it is determined the likelihood of collecting substantially all of the note and accrued interest is not probable the notes are put on non-accrual status. The Company's investment in notes receivable on nonaccrual status at April 30, 2017 and 2016 was $7.0 million and $6.1 million, respectively. Payments received on notes in nonaccrual status are applied to the principal note balance until the note is current and then to interest income. Nonaccrual notes that are paid current are moved back into accrual status during the next annual review.

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Property, Equipment, and Software, Net - Text Blocks

12 Months Ended

Apr. 30, 2017

Property, Plant and Equipment [Abstract]

Property, Equipment, and Software, Net

Property, Equipment, and Software, Net

Property, equipment, and software at April 30, 2017 and 2016 was as follows:

	2017		2016
	(In thousands)
Land and land improvements	$	1,464	$	2,413
Buildings and building improvements	7,964		8,733
Leasehold improvements	132		138
Furniture, fixtures, and equipment	5,788		6,307
Software	50,413		44,418
Property, equipment, and software, gross	65,761		62,009
Less accumulated depreciation and amortization	25,972		21,052
Property, equipment, and software, net	$	39,789	$	40,957

The software included above includes both internally developed software and purchased software. Included in software are $20.2 million and $19.9 million of assets that had not been placed into service at April 30, 2017 and 2016, respectively. See Note 5 for a description of the impairment related to the Company's online software and acquired online customer lists in the year ended April 30, 2015.

Total depreciation and amortization expense on property, equipment, and software was $4.2 million, $4.7 million, and $5.5 million for the years ended April 30, 2017, 2016, and 2015, respectively.

The Company is obligated under various operating leases for office space that expire at various dates. At April 30, 2017, future minimum lease payments under non-cancelable operating leases with initial or remaining lease terms in excess of one year, together with amounts due from franchisees under subleases, were as follows:

	Lease payments		Sublease receipts
	(In thousands)
Year ending April 30:
2018	$	9,518	$	4,352
2019	5,885		2,733
2020	3,455		1,785
2021	1,591		726
2022	670		344
Thereafter	263		150
Total minimum lease payments	$	21,382	$	10,090

Total rent expense for operating leases, net of subleases, was $7.7 million, $4.7 million, and $3.2 million for the years ended April 30, 2017, 2016, and 2015, respectively.

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Investments - Text Blocks

12 Months Ended

Apr. 30, 2017

Investments, Debt and Equity Securities [Abstract]

Investments

Investments

During the year ended April 30, 2016, the Company purchased a corporate equity security for $5.0 million, which was classified as available-for-sale and reported in other non-current assets. The Company recorded an unrealized loss at April 30, 2016 of $0.5 million, net of taxes, which was reported in the Company's consolidated statements of comprehensive income. This security was sold during the first half of fiscal 2017 and a gain on the sale of $50,000 was recognized and reclassified out of accumulated other comprehensive income, net of taxes and recorded as other income. The Company had no other such transactions during the year ended April 30, 2017.

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Goodwill and Intangible Assets - Text Blocks

12 Months Ended

Apr. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Changes in the carrying amount of goodwill for the years ended April 30, 2017 and 2016 were as follows:

	2017			2016
	(In thousands)
Balance at beginning of year	$	4,228		$	3,377
Acquisitions of assets from franchisees and third parties	3,649			960
Disposals and foreign currency changes, net	(226		)	(52		)
Impairments	(184		)	(57		)
Reclassified from assets held for sale	1,109			—
Balance at end of year	$	8,576		$	4,228

The Company performed its annual impairment review of goodwill and recorded impairment of $0.2 million and $0.1 million for the years ended April 30, 2017 and 2016, respectively.

The impairment recorded above was determined using the fair value of the underlying franchise, and where appropriate a discounted cash flow model, and is included in the depreciation, amortization and impairment charges in the consolidated statements of income.

Components of amortizable intangible assets as of April 30, 2017 and 2016 were as follows:

	April 30, 2017
	Weighted average amortization period	Gross carrying amount		Accumulated amortization			Net carrying amount
	(In thousands)
Customer lists acquired from unrelated third parties	4 years	$	2,827	$	(899	)	$	1,928
Assets acquired from franchisees:
Customer lists	4 years	1,189		(908		)	281
Reacquired rights	2 years	935		(919		)	16
AD rights	10 years	26,427		(7,428		)	18,999
Total intangible assets		$	31,378	$	(10,154	)	$	21,224

	April 30, 2016
	Weighted average amortization period	Gross carrying amount		Accumulated amortization			Net carrying amount
	(In thousands)
Customer lists acquired from unrelated third parties	4 years	$	1,027	$	(339	)	$	688
Assets acquired from franchisees:
Customer lists	4 years	1,380		(500		)	880
Reacquired rights	2 years	511		(482		)	29
AD rights	10 years	20,218		(5,545		)	14,673
Total intangible assets		$	23,136	$	(6,866	)	$	16,270

For the years ended April 30, 2017 and 2016 the Company recorded as intangible assets of less than $0.1 million, and $1.8 million, respectively, from acquisitions of various franchises and third parties. During fiscal 2017 and fiscal 2016, the majority of U.S. franchise acquisitions were recorded as assets held for sale, while Canadian franchise acquisitions continued to be recorded as intangible assets. All franchise acquisitions were accounted for as business combinations. Also during fiscal 2017 we purchased six offices which we have only preliminary estimates of fair values of the identifiable assets acquired.

The purchase price of assets acquired from franchisees and third parties and recorded as customer lists, reacquired rights, and goodwill and held for use during fiscal 2017 and 2016, was allocated as follows.

	2017		2016
	(In thousands)
Customer lists	$	13	$	728
Reacquired rights	11		39
Goodwill	25		1,048
Purchase price of assets acquired from franchisees, not held for sale	$	49	$	1,815

During the third and fourth quarters of 2017, the Company acquired the assets of six unrelated offices of smaller regional or local accounting firms for cash of $2.3 million and $2.8 million of estimated contingent consideration that is included in long-term obligations. The offices perform year round accounting services. The following table summarizes the preliminary estimates of the fair values of the identifiable assets acquired. The preliminary estimates of the fair value of identifiable assets are based on estimates and assumptions that are are subject to revisions, this may result in adjustments to the preliminary values presented below, when management's estimates are finalized:

	April 30, 2017
	(in thousands)
Accounts receivable	$	261
Property, equipment, and software, net	55
Customer lists	1,120
Goodwill	3,624
Total purchase price	$	5,060

The Company intends to sell the majority of assets associated with Company-owned offices within one year. During the years ended April 30, 2017 and 2016, impairment analysis were performed for amortizable intangible assets. Write-downs of assets acquired from franchisees relate to Company-owned offices that were subsequently closed and impairment of the fair value of existing Company-owned offices. As a result, the carrying values of assets acquired from franchisees were reduced by less than $0.1 million for the fiscal year ended April 30, 2017, less than $0.1 million for 2016, and $0.5 million for 2015. These amounts were included in depreciation, amortization and impairment charges, in the consolidated statements of income. The Company estimated the fair value of assets associated with Company-owned offices based on various models.

For the years ended April 30, 2017, 2016, and 2015, amortization expense was $4.1 million, $2.3 million, and $3.6 million, respectively. Annual amortization expense for the next five years is estimated to be as follows (in thousands):

Year ending April 30:
2018	$	3,664
2019	3,438
2020	3,109
2021	2,559
2022	2,269
Total estimated amortization expense	$	15,039

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Assets Held for Sale - Text Blocks

12 Months Ended

Apr. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

assets held for sale [Text Block]

Assets Held for Sale

During fiscal 2017, the Company acquired $16.6 million in assets from U.S. franchisees and third parties that were first accounted for as business combinations, with the value allocated to customer lists and reacquired rights of $8.3 million and goodwill of $8.3 million prior to being recorded as assets held for sale. During fiscal 2016, the Company acquired $13.3 million in assets from U.S. franchisees and third parties that were first accounted for as business combinations, with the value allocated to customer lists and reacquired rights of $6.1 million and goodwill of $7.2 million prior to being recorded as assets held for sale. The acquired businesses are operated as Company-owned offices until a buyer is located and a new franchise agreement is entered into.

Changes in the carrying amounts of assets held for sale for the fiscal years ended April 30, 2017 and 2016 were as follows:

	2017			2016
	(In thousands)
Balance at beginning of year	$	9,886		$	5,160
Reacquired, acquired from third parties, and other	16,600			13,309
Dispositions	(7,994		)	(6,526		)
Impairment	(5,663		)	(2,057		)
Transferred to assets held for use	(2,428		)	—
Transferred from property and equipment	1,588			—
Balance at end of year	$	11,989		$	9,886

The Company acquired these assets for $5.1 million in cash, the issuance of $2.8 million in long-term obligations and $8.7 million of receivables applied.

During fiscal 2017, the Company reviewed assets held for sale for assets that were deemed unlikely to be sold in the next 12 months. Assets totaling $2.4 million, comprised of $0.7 million of customer lists, $0.6 million of reacquired rights and $1.1 million of goodwill, were identified and transferred to assets held for use. Amortization expense was recorded on a cumulative basis for customers lists and reacquired rights for $0.3 million and $0.5 million, respectively.

During fiscal 2017, the Company transferred a building it had previously been using and was classified as fixed assets to assets held for sale.

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Debt - Text Blocks

12 Months Ended

Apr. 30, 2017

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Obligations

The Company has an amended credit facility that consists of a $21.2 million term loan and a revolving credit facility that currently allows borrowing of up to $203.8 million with an accordion feature that permits the Company to request an increase in availability of up to an additional $50.0 million. Outstanding borrowings accrue interest, which is paid monthly, at a rate of the one-month London Interbank Offered Rate ("LIBOR") plus a margin ranging from 1.50% to 2.25% depending on the Company's leverage ratio. At April 30, 2017 and 2016, the interest rate was 2.73% and 2.06%, respectively, and the average interest rate paid during the fiscal year ended April 30, 2017 was 2.31%. A commitment fee is paid monthly that varies from 0.25% to 0.50% depending on the Company's leverage ratio on the unused portion of the credit facility. The indebtedness is collateralized by substantially all the assets of the Company and both loans mature on April 30, 2019 (except as to the commitments of one smaller lender under the revolving credit facility, which mature on September 30, 2017).

The credit facility contains certain financial covenants that the Company must meet, including leverage and fixed-charge coverage ratios as well as minimum net worth requirements. In addition, the Company must reduce the outstanding balance under its revolving loan to zero for a period of at least 45 consecutive days each fiscal year. The Company's borrowing availability on the credit facility at April 30, 2017 was $108.0 million. At April 30, 2017 and 2016, the Company had no outstanding borrowings under its revolving credit facility. The Company was in compliance with the financial covenants of its credit facility at April 30, 2017.

The credit facility also contains certain events of default that may cause the bank syndicate to terminate the credit facility and declare amounts owed to become immediately payable if they occur. At April 30, 2017, the Company has not incurred an event of default.

Debt at April 30, 2017 and 2016 was as follows:

	2017		2016
	(In thousands)
Term loan payable in quarterly principal installments of 2.50%, and 3.13% of the original amount borrowed for the years ending April 30, 2018 and 2019, respectively; on April 30, 2019 a balloon payment of $13,016 is payable.	$	17,471	$	18,884
Mortgage note payable to a bank in monthly installments ranging from $10 to $14 including interest at LIBOR plus 1.85%, which was 2.84% at April 30, 2017, through December 1, 2026; at that time a balloon payment of $779 is payable; subject to a prepayment penalty; collateralized by land and building.	2,160		—
Mortgage note payable to a bank in monthly installments of $16 including interest at 6.06% through September 2016; at that time a balloon payment of $2,213 is payable; subject to a prepayment penalty; collateralized by land and building.	—		2,230
Amounts due to former ADs, franchisees and third parties at zero percent interest; due May 2017 through April 2020.	6,568		2,317
Other debt	—		9
Total long-term obligations	26,199		23,440
Less current installments	7,738		5,947
Total long-term obligations, less current installments	$	18,461	$	17,493

As discussed in Note 1, the adoption of ASU 2015-03 and ASU 2015-15 resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's borrowings from other assets to long-term obligations within our consolidated balance sheet for each period ended April 30, 2017 and 2016, respectively.

Aggregate maturities of long-term debt at April 30, 2017 were as follows (in thousands):

Year ending April 30:
2018	$	7,738
2019	16,510
2020	171
2021	136
2022	140
Thereafter	1,504
Total long-term debt	$	26,199

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Derivative Instruments and Hedging Activities - Text Blocks

12 Months Ended

Apr. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

From time to time, the Company uses interest-rate-related derivative financial instruments to manage its exposure related to changes in interest rates on its variable-rate line of credit and forward contracts to manage its exposure to foreign currency fluctuation related to short-term advances made to its Canadian subsidiary. The Company does not speculate using derivative instruments nor does it enter into derivative instruments for any purpose other than cash flow hedging.

By using derivative financial instruments to hedge exposures to changes in interest rates, the Company exposes itself to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company money, which creates credit risk for the Company. When the fair value of a derivative contract is negative, the Company owes the counterparty money, and therefore, the Company is not exposed to the counterparty's credit risk in those circumstances. The Company minimizes counterparty credit risk in derivative instruments by entering into transactions with high-quality counterparties. The derivative instruments entered into by the Company do not contain credit-risk-related contingent features.

Market risk is the adverse effect on the value of a derivative instrument that results from a change in interest rates. The market risk associated with interest rates is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.

The Company assesses interest rate risk by continually identifying and monitoring changes in interest rates that may adversely impact expected future cash flows and by evaluating hedging opportunities. The Company maintains risk management control systems to monitor interest rate risk attributable to both the Company's outstanding or forecasted debt obligations and forecasted revenues as well as the Company's offsetting hedge positions. The risk management control systems involve the use of analytical techniques, including cash flow sensitivity analysis, to estimate the expected impact of changes in interest rates and foreign currency rates on the Company's future cash flows.

Interest rate swap agreements. In December 2016, in connection with obtaining a mortgage payable to a bank, the Company entered into an interest rate swap agreement, with a notional amount of $2.2 million, equal to the mortgage amount, that allows it to manage fluctuations in cash flow resulting from changes in the interest rate on the mortgage. This swap effectively changes the variable-rate of the Company's mortgage into a fixed rate of 4.12%.The Company has designated this swap agreement as a cash flow hedge. At April 30, 2017, the fair value of the interest rate swap is less than $0.1 million and is included in "Accounts payable and accrued expenses" on the accompanying consolidated balance sheets. The interest rate swap expires in December 2026.

Forward contracts related to foreign currency exchange rates. In connection with short-term advances made to its Canadian subsidiary related to personal income tax refund discounting, the Company enters into forward contracts to eliminate the exposure related to foreign currency fluctuations. Under the terms of the forward currency contracts, the exchange rate for repayments is fixed at the time advance is made and the advances are repaid prior to April 30 of each year. These forward contracts are designated as cash flow hedges. At April 30, 2017 and 2016, there were no remaining forward contracts outstanding. During the years ended April 30, 2017, 2016, and 2015, these foreign currency hedges were effective and, therefore, no amounts were recognized in the consolidated statements of income.

At April 30, 2017, there were no deferred gains related to forward contracts for foreign currency exchange rates accumulated in other comprehensive income.

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Stockholders' Equity - Text Blocks

12 Months Ended

Apr. 30, 2017

Equity [Abstract]

Shareholders' Equity and Share-based Payments [Text Block]

Stockholders' Equity

Preferred Stock and Exchangeable Shares

The Company has 190,000 shares of authorized Class A preferred stock with a par value of $0.01, of which none were issued and outstanding at April 30, 2017 and 2016.

The Company also has 10 shares of special voting preferred stock authorized, issued and outstanding with a par value of $0.01 and no liquidation value. Each share of special voting preferred stock entitles the holder to vote as if it represents 100,000 shares of Class A common stock. In conjunction with the special voting preferred stock, there are 1,000,000 exchangeable shares with a par value of $0.01 that are exchangeable at any time into an equal number of shares of Class A common stock of the Company. The special voting preferred stock will be canceled at the time the holder exchanges the exchangeable shares.

Common Stock

The Company is authorized to issue 21,200,000 shares of Class A common stock, par value $0.01 per share, and 1,000,000 shares of Class B common stock, par value $0.01 per share. Class A common stock and Class B common stock entitle the holders to the same rights and privileges and are identical in all respects as to all matters, except the holders of Class B common stock are entitled to elect one more director than the number of directors elected by holders of all other classes of stock combined. Additionally, a holder of Class B common stock may, at the holder's option, elect to convert the Class B common stock into an equal number of fully paid and non-assessable shares of Class A common stock.

Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive loss at April 30, 2017 and 2016 are as follows.

	2017			2016
	(In thousands)
Foreign currency adjustment	$	(2,059	)	$	(1,148	)
Unrealized loss on equity securities available for sale, net of taxes	30			(550		)
Gain on sale of available-for-sale securities, net of taxes	(30		)	—
Interest rate swap agreements, net of tax	(25		)	—
Total accumulated other comprehensive loss	$	(2,084	)	$	(1,698	)

Net Income per Share

Net income per share of Class A and Class B common stock is computed using the two-class method. Basic net income per share is computed by allocating undistributed earnings to common shares and participating securities (Class A preferred stock and exchangeable shares) and using the weighted-average number of common shares outstanding during the period. Undistributed losses are not allocated to participating securities because they do not meet the required criteria for such allocation.

Diluted net income per share is computed using the weighted-average number of common shares and, if dilutive, the potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and vesting of restricted stock units. The dilutive effect of outstanding stock options and restricted stock units is reflected in dilutive earnings per share by application of the treasury stock method. Additionally, the computation of diluted net income per share of Class A common stock assumes the conversion of Class B common stock and exchangeable shares, if dilutive, while the diluted net income per share of Class B common stock does not assume conversion of those shares.

The rights, including liquidation and dividend rights, of the holders of Class A and Class B common stock are identical, with the exception of the election of directors. As a result, the undistributed earnings for each year are allocated based on the contractual participation rights of the Class A and Class B common stock as if the earnings for the year had been distributed. Participating securities have dividend rights that are identical to Class A and Class B common stock.

The computation of basic and diluted net income per share for the years ended April 30, 2017, 2016, and 2015 is as follows.

	2017
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	12,745		$	268
Amounts allocated to participating securities:
Exchangeable shares	(917		)	(19		)
Net income attributable to common stockholders	$	11,828		$	249
Denominator:
Weighted-average common shares outstanding	12,630,356			265,205
Basic net income per share	$	0.94		$	0.94
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	11,828		$	249
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	249			—
Exchangeable shares to Class A common stock	936			—
Net income attributable to stockholders	$	13,013		$	249
Denominator:
Number of shares used in basic computation	12,630,356			265,205
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	265,205			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	21,347			407
Weighted-average diluted shares outstanding	13,916,908			265,612
Diluted net income per share	$	0.94		$	0.94

	2016
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	18,056		$	1,364
Amounts allocated to participating securities:
Exchangeable shares	(1,307		)	(99		)
Net income attributable to common stockholders	$	16,749		$	1,265
Denominator:
Weighted-average common shares outstanding	11,914,775			900,000
Basic net income per share	$	1.41		$	1.41
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	16,749		$	1,265
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	1,265			—
Exchangeable shares to Class A common stock	1,406			—
Net income attributable to stockholders	$	19,420		$	1,265
Denominator:
Number of shares used in basic computation	11,914,775			900,000
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	900,000			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	209,896			13,674
Weighted-average diluted shares outstanding	14,024,671			913,674
Diluted net income per share	$	1.38		$	1.38

	2015
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	8,076		$	614
Amounts allocated to participating securities:
Exchangeable shares	(588		)	(45		)
Net income attributable to common stockholders	$	7,488		$	569
Denominator:
Weighted-average common shares outstanding	11,838,887			900,000
Basic net income per share	$	0.63		$	0.63
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	7,488		$	569
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	569			—
Exchangeable shares to Class A common stock	633			—
Net income attributable to stockholders	$	8,690		$	569
Denominator:
Number of shares used in basic computation	11,838,887			900,000
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	900,000			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	555,886			36,415
Weighted-average diluted shares outstanding	14,294,773			936,415
Diluted net income per share	$	0.61		$	0.61

Diluted net income per share excludes the impact of shares of potential common stock from the exercise of options and vesting of restricted stock units to purchase 1,320,162, 429,644 and 210,416 shares for the years ended April 30, 2017, 2016, and 2015, respectively, because the effect would be anti-dilutive.

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Stock Compensation Plan - Text Blocks

12 Months Ended

Apr. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Compensation Plan

Stock Compensation Plan

Stock Options

In August 2011, the Board of Directors approved the JTH Holding, Inc. 2011 Equity and Cash Incentive Plan. Employees and outside directors are eligible to receive awards and a total of 2,500,000 shares of Class A common stock were authorized for grant under the plan. At April 30, 2017, 1,082,412 shares of Class A common stock remained available for grant.

The following table summarizes the information for options granted in the years ended April 30, 2017, 2016, and 2015.

	2017	2016	2015
Weighted-average fair value of options granted	$2.45	$5.05	$9.59
Dividend yield	5.0% - 6.1%	2.8% - 3.7%	0.0% - 2.2%
Expected volatility	32.8% - 35.4%	32.4% - 35.6%	31.1% - 31.7%
Expected terms	5 - 6 years	4 - 6 years	5 years
Risk-free interest rates	1.2% - 2.1%	1.4% - 1.7%	1.6% - 1.9%

The Company does not have enough public trading history to calculate volatility for the term of the granted options, therefore, it used a 75/25 weighted-average volatility, weighing our public trading history and that of other public companies in the tax preparation industry.

The grants made prior to June 2012 were made prior to our becoming a public company; therefore, we considered appropriate accounting literature regarding the valuation of privately-held company equity securities and determined that the values established in private transactions provided a reasonable basis for establishing the fair value for stock compensation expense purposes. On this basis, we did not obtain any third party valuation or utilize other valuation methods. Any grants made after we became a public company were valued using the closing market price of the preceding business day.

Stock option activity during the years ended April 30, 2017, 2016, and 2015 was as follows:

	Number of options		Weighted average exercise price
Outstanding at April 30, 2014	1,940,406		$	16.68
Granted	170,416		32.87
Exercised	(761,913	)	15.73
Forfeited or expired	(5,350	)	15.00
Outstanding at April 30, 2015	1,343,559		19.28
Granted	227,387		22.30
Exercised	(154,594	)	14.79
Forfeited or expired	(151,790	)	24.31
Outstanding at April 30, 2016	1,264,562		19.77
Granted	512,119		12.61
Exercised	—		—
Forfeited or expired	(389,350	)	16.59
Outstanding at April 30, 2017	1,387,331		$	18.02

Intrinsic value is defined as the fair value of the stock less the cost to exercise. There were no exercises of options in fiscal 2017, the total intrinsic value of options exercised was $0.9 million and $13.3 million during the years ended April 30, 2016 and 2015, respectively. The total intrinsic value of stock options outstanding at April 30, 2017 was $0.7 million. Outstanding options have vesting terms that range from six months to six years from the date of grant and expire from four to five years after the vesting date.

Nonvested stock options (options that had not vested in the period reported) activity during the years ended April 30, 2017, 2016, and 2015 was as follows:

	Nonvested options		Weighted average exercise price
Outstanding at April 30, 2014	485,000		$	20.92
Granted	170,416		32.87
Vested	(270,000	)	18.99
Forfeited	—		—
Outstanding at April 30, 2015	385,416		27.56
Granted	227,387		22.30
Vested	(173,750	)	25.16
Forfeited	(50,000	)	33.79
Outstanding at April 30, 2016	389,053		24.76
Granted	512,119		12.61
Vested	(223,054	)	23.88
Forfeited	—		—
Outstanding at April 30, 2017	678,118		$	15.88

At April 30, 2017, unrecognized compensation cost related to non-vested stock options was $2.0 million. These costs are expected to be expensed through fiscal 2021.

The following table summarizes information about stock options outstanding and exercisable at April 30, 2017.

	Options outstanding				Options exercisable
Range of Exercise Prices	Number of options outstanding	Weighted average exercise price		Weighted average remaining contractual life (in years)	Number of options exercisable	Weighted average exercise price
10.51 to 15.00	706,712	$	13.27	4.7	194,593	$	15.00
16.38 - 19.75	284,816	17.93		3.0	266,816	17.96
22.18 - 29.48	330,387	25.22		4.5	212,387	25.15
33.38	65,416	33.38		4.5	35,417	33.38
	1,387,331	$	18.02		709,213	$	20.07

Restricted Stock Units

The Company has awarded restricted stock units to its non-employee directors and certain employees. Restricted stock units are valued at the closing stock price the day preceding the grant date. Compensation costs associated with these restricted shares are amortized on a straight-line basis over the vesting period and recognized as an increase in additional paid-in capital. At April 30, 2017, unrecognized compensation cost related to restricted stock units was $2.0 million. These costs are expected to be recognized through fiscal 2022.

Restricted stock activity during the years ended April 30, 2017, 2016 and 2015 was as follows.

	Number of RSUs		Weighted Average Fair Value at Grant Date
Balance at April 30, 2014	21,445		$	16.87
Granted	25,691		33.38
Vested	(14,746	)	16.38
Forfeited	(3,461	)	26.47
Balance at April 30, 2015	28,929		30.63
Granted	32,056		23.06
Vested	(13,394	)	27.99
Forfeited	(4,799	)	27.89
Balance at April 30, 2016	42,792		26.10
Granted	165,454		12.62
Vested	(17,118	)	24.58
Forfeited	(14,732	)	25.94
Balance at April 30, 2017	176,396		$	13.61

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Fair Value of Financial Instruments

12 Months Ended

Apr. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities subject to fair value measurements are classified according to a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. Valuation methodologies for the fair value hierarchy are as follows.

• Level 1—Quoted prices for identical assets and liabilities in active markets.

• Level 2—Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-based valuations in which all significant inputs are observable in the market.

• Level 3—Unobservable inputs in which little or no market data exists, therefore, requiring an entity to develop its own assumptions.

The Company measures or monitors certain of its assets and liabilities on a fair value basis. Fair value is used on a recurring basis for those assets and liabilities for which fair value is the primary basis of accounting. Other assets and liabilities are measured at fair value on a nonrecurring basis; that is, they are subject to fair value adjustment in certain circumstances, such as when there is evidence of impairment.

The following tables present, for each of the fair value hierarchy levels, the assets and liabilities that are measured at fair value on a recurring and nonrecurring basis at April 30, 2017 and 2016.

			April 30, 2017 Fair value measurements using
	Total		Level 1		Level 2		Level 3
	(In thousands)
Recurring assets:
Cash equivalents	$	10,393	$	10,393	$	—	$	—
Total recurring assets	10,393		10,393		—		—
Nonrecurring assets:
Impaired accounts and notes receivable, net of unearned revenue	16,500		—		—		16,500
Impaired goodwill	94		—		—		94
Impaired customer lists	18		—		—		18
Assets held for sale	11,989		—		—		11,989
Total nonrecurring assets	28,601		—		—		28,601
Total recurring and nonrecurring assets	$	38,994	$	10,393	$	—	$	28,601
Recurring liabilities
Contingent consideration included in obligations due former ADs, franchisees and others	3,215		—		—		3,215
Total recurring liabilities	$	3,215	$	—	$	—	$	3,215

			April 30, 2016 Fair value measurements using
	Total		Level 1		Level 2		Level 3
	(In thousands)
Recurring assets:
Cash equivalents	$	7,140	$	7,140	$	—	$	—
Available-for-sale securities	4,123		4,123		—		—
Total recurring assets	11,263		11,263		—		—
Nonrecurring assets:
Impaired accounts and notes receivable, net of unearned revenue	12,256		—		—		12,256
Impaired goodwill	63		—		—		63
Impaired reacquired rights	28		—		—		28
Impaired customer lists	34		—		—		34
Assets held for sale	9,886		—		—		9,886
Total nonrecurring assets	22,267		—		—		22,267
Total recurring and nonrecurring assets	$	33,530	$	11,263	$	—	$	22,267

The Company's policy is to recognize transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer. There were no transfers into or out of Level 1 or 2 recurring fair value measurements for the years ended April 30, 2017 and 2016.

The following methods and assumptions are used to estimate the fair value of our financial instruments.

Cash equivalents: The carrying amounts approximate fair value because of the short maturity of these instruments. Cash equivalent financial instruments consist of money market accounts.

Impaired accounts and notes receivable: Accounts and notes receivable are considered to be impaired if the net amounts due exceed the fair value of the underlying franchise or if management considers it probable that all principal and interest will not be collected when contractually due. In establishing the estimated fair value of the underlying franchise, consideration is given to a variety of factors, including, recent comparable sales of Company-owned stores, sales between franchisees, the net fees of open offices, and the number of unopened offices.

Impaired goodwill, reacquired rights, and customer lists: Goodwill, reacquired rights, and customer lists associated with a Company-owned office are considered to be impaired if the net carrying amount exceeds the fair value of the underlying office. In establishing the fair value of the underlying office, consideration is given to the related net fees, subjected to a floor of the value of a new franchise.

Assets held for sale: Assets held for sale are recorded at the lower of the carrying value or the expected sales price, less costs to sell, which approximates fair value. The expected sales price is generally calculated as a percentage of the prior year's net fees.

Contingent consideration included in long-term obligations: Contingent consideration is carried at fair value. The fair value of these obligations was determined based upon the estimated future net revenues of the acquired businesses.

Other Fair Value Measurements

Accounting standards require the disclosure of the estimated fair value of financial instruments that are not recorded at fair value. For the financial instruments not recorded at fair value, estimates of fair value are made at a point in time based on relevant market data and information about the financial instrument. No readily available market exists for a significant portion of the Company's financial instruments. Fair value estimates for these instruments are based on current economic conditions, interest rate risk characteristics, and other factors. Many of these estimates involve uncertainties and matters of significant judgment and cannot be determined with precision. Therefore, the calculated fair value estimates in many instances cannot be substantiated by comparison to independent markets and, in many cases, may not be realizable in a current sale of the instrument. In addition, changes in assumptions could significantly affect these fair value estimates. The following methods and assumptions were used by the Company in estimating the fair value of these financial instruments.

Receivables other than notes, other current assets, accounts payable and accrued expenses, and due to ADs: The carrying amounts approximate fair value because of the short maturity of these instruments (Level 1).

Notes receivable: The carrying amount approximates fair value because the interest rate charged by the Company on these notes approximates rates currently offered by local lending institutions for loans of similar terms to individuals/entities with comparable credit risk (Level 3).

Long-term debt: The carrying amount approximates fair value because the interest rate paid has a variable component (Level 2).

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Employee 401(k) Plan

12 Months Ended

Apr. 30, 2017

Compensation and Retirement Disclosure [Abstract]

Employee 401(k) Plan

Employee 401(k) Plan

The Company sponsors a defined-contribution 401(k) profit sharing plan. Under the plan, employees who are 18 years of age and have completed 90 days of service are eligible to make voluntary contributions to the plan. The Company matches 50% of each employee's contribution up to 3% of the employee's salary. Total compensation expense related to these contributions was $0.5 million for each of the three years ended April 30, 2017, 2016, and 2015.

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Income Taxes

12 Months Ended

Apr. 30, 2017

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Management makes an assessment to determine if its deferred tax assets are more likely than not to be realized.  State tax carry-forwards and net operating losses of $0.1 million expire from 2017 to 2036.

We operate in multiple taxing jurisdictions within the U.S. and Canada and are subject to examination from various tax authorities. The liability for unrecognized tax expense included less than $100,000 of accrued interest as of April 30, 2017.  If recognized, this liability would impact the effective tax rate.

Interest incurred from income taxes is recognized as incurred and recorded as income tax expense on the consolidated statements of income. Penalties are recognized as incurred and recorded as nondeductible penalties expense and included in general and administrative expense on the consolidated statements of income.

Total income taxes were calculated for the years ended April 30, 2017, 2016, and 2015 as follows.

	2017		2016			2015
	(In thousands)
Income tax expense	$	7,754	$	11,058		$	4,811
Tax impact of stock option activity	378		(900		)	(4,803		)
Unrealized gain (loss) on available-for-sale securities	—		(326		)	—
Total income taxes	$	8,132	$	9,832		$	8

Components of income tax expense for the years ended April 30, 2017, 2016, and 2015 were as follows.

	2017			2016			2015
	(In thousands)
Current:
Federal	$	6,125		$	2,748		$	5,973
State	1,160			598			2,157
Foreign	293			328			226
Current tax expense	7,578			3,674			8,356
Deferred:
Federal	315			6,079			(2,629		)
State	(183		)	1,322			(950		)
Foreign	44			(17		)	34
Deferred tax expense (benefit)	176			7,384			(3,545		)
Total income tax expense	$	7,754		$	11,058		$	4,811

For the years ended April 30, 2017, 2016, and 2015, income before taxes consisted of the following.

	2017		2016		2015
	(In thousands)
U.S. operations	$	19,558	$	28,954	$	12,459
Foreign operations	1,209		1,524		1,042
Income before income taxes	$	20,767	$	30,478	$	13,501

Income tax expense differed from the amounts computed by applying the U.S. federal income tax rate of 35% to pretax income from continuing operations as a result of the following for the years ended April 30, 2017, 2016, and 2015.

	2017			2016			2015
	(In thousands)
Computed "expected" income tax expense	$	7,269		$	10,667		$	4,725
Increase (decrease) in income taxes resulting from:
State income taxes, net of federal benefit	634			1,126			1,034
Nondeductible expenses	211			246			308
Tax credits	(140		)	(370		)	(251		)
Domestic production deduction	(158		)	(538		)	(466		)
Stock compensation expense	58			31			(378		)
Foreign tax rate differential	(86		)	(222		)	(104		)
Rate change	(64		)	—			18
Other	30			118			(75		)
Total income tax expense	$	7,754		$	11,058		$	4,811

The tax effect of temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities that give rise to significant portions of deferred tax assets and liabilities at April 30, 2017 and 2016 are as follows:

	2017			2016
	(In thousands)
Deferred tax assets:
Deferred revenue	$	11,286		$	1,236
Allowance for doubtful accounts	5,136			3,707
Goodwill, intangible assets, and assets held for sale	3,140			—
Unexercised nonqualified stock options	2,260			2,292
Accounts payable and accrued expense	1,954			594
Net operating loss	148			—
Total deferred tax assets	23,924			7,829
Deferred tax liabilities:
Property, equipment and software	12,916			10,285
Section 481(a) adjustment - change in accounting method	11,729			—
Intangible assets	2,048			—
Other current assets	505			370
Deferred contingencies	137			—
Total deferred tax liabilities	27,335			10,655
Net deferred tax liability	$	(3,411	)	$	(2,826	)

In assessing the realizability of the gross deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that the benefits of these deductible differences will be realized.

The Company has adopted the accounting and disclosure requirements for uncertain tax positions, which require a two-step approach to evaluate tax positions. This approach involves recognizing any tax positions that are more likely than not to occur and then measuring those positions to determine the amounts to be recognized in the financial statements. The Company has determined no reserves for uncertain tax positions were required at April 30, 2017 or 2016.

Foreign subsidiary net earnings that were considered permanently reinvested were $1.2 million, $1.5 million, and $1.0 million for the fiscal years ended April 30, 2017, 2016, and 2015, respectively. Because these foreign subsidiary net earnings are considered permanently reinvested, the amount of deferred tax liability that would need to be provided if these earnings were not reinvested is not reasonably determinable.

We are currently being audited in two tax jurisdictions and remain subject to examination until the statute of limitations expires for the respective tax jurisdictions. We currently do not believe that our open audit will result in an amount due. At April 30, 2017, the tax years that remain subject to examination by the Internal Revenue Service and other major taxing jurisdictions relate to the fiscal years ended April 30, 2016, 2015, and 2014.

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Related Party Transactions

12 Months Ended

Apr. 30, 2017

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The Company considers directors and their affiliated companies as well as executive officers and their immediate family to be related parties. For the years ended April 30, 2017, 2016, and 2015, the Company repurchased common stock from related parties as follows.

	2017		2016		2015
	(In thousands)
Common stock:
Shares repurchased	30		—		1,007
Amount	$	378	$	—	$	26,954

During fiscal 2015, the Company entered into a multi-year contract to purchase a license for the use of Canadian tax software at a price of $0.7 million from a company in which it has an investment accounted for under the equity method. One of the members of the Company's Board of Directors is affiliated with the company providing this service. This contract expired during the second quarter of fiscal 2017. At that same time, the Company entered into a new three year contract with the same company at a price of $0.9 million.

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Commitments and Contingencies

12 Months Ended

Apr. 30, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

In the ordinary course of operations, the Company may become a party to legal proceedings. Based upon information currently available, management believes that such legal proceedings, individually or in the aggregate, will not have a material adverse effect on the Company's business, financial condition, cash flows, or results of operations except as provided below.

JTH Tax, Inc. and SiempreTax LLC v. Gregory Aime, Aime Consulting, LLC, Aime Consulting, Inc. and Wolf Ventures, Inc. (Case No. 2:16-cv-279). We filed suit in the United States District Court for the Eastern District of Virginia against the defendants, former Company franchisees, on June 9, 2016, as amended on June 22, 2016, claiming the defendants breached the purchase and sale agreement (the “PSA”) entered between the parties on January 21, 2016 and that the defendants had failed to comply with the post termination obligations of the franchise agreements (together with the PSA, the “Aime Agreements”). We sought damages in an amount equal to three times the defendants’ earnings and profits, as well as injunctive relief to enforce the defendants to comply with the post termination obligations of the Aime Agreements, to be determined by the trier of fact. We specifically sought, in part, to enjoin the defendants from continued operation of a tax preparation business using the our protected trademarks, enforcement of the non-compete provision of the Aime Agreements, and an order that the defendants assign all of the leases related to the franchised businesses to us. On July 1, 2016, the Magistrate Judge issued a report and recommendation finding a likelihood of success on the merits and recommending entry of the requested temporary restraining order (the “TRO”) in our favor, which was adopted in part on August 3, 2016. On September 9, 2016, the defendants filed an answer and counterclaim against us, alleging breach of the PSA, breach of the implied covenant of good faith and fair dealing and fraud and seeking approximately $2.4 million in damages, plus future loss profits, punitive damages and other expenses. After a three-day bench trial, on January 13, 2017, the court vacated the TRO, finding in favor of the defendants. On February 15, 2017, the court issued its written opinion and order granting the defendants’ breach of contract and breach of the implied covenant of good faith and fair dealing claims, denying our claims against the defendants and finding certain post termination obligations to be unenforceable. Judgment was entered in favor of the defendants for approximately $2.7 million. We have reserved $2.7 million in connection with the judgment, which is recorded in "Accounts payable and accrued expense" in the accompanying consolidated balance sheets. We intend to vigorously defend our position and pursue an appeal of the judgment.

The Company is also party to claims and lawsuits that are considered to be ordinary, routine litigation incidental to the business, including claims and lawsuits concerning the preparation of customers' income tax returns, the fees charged to customers for various products and services, relationships with franchisees, intellectual property disputes, employment matters, and contract disputes. Although the Company cannot provide assurance that it will ultimately prevail in each instance, it believes the amount, if any, it will be required to pay in the discharge of liabilities or settlements in these claims will not have a material adverse impact on its consolidated results of operations, financial position or cash flows. Costs incurred with defending matters are expensed as incurred.

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Quarterly FInancial Data

12 Months Ended

Apr. 30, 2017

Quarterly Financial Data [Abstract]

Quarterly Financial Data (Unaudited)

Quarterly Financial Data (Unaudited)

	Three Months Ended
	April 30, 2017		January 31, 2017		October 31, 2016			July 31, 2016
	(In thousands, except per share amounts)
Revenue	$	111,179	$	48,423	$	7,234		$	7,149
Net income (loss)	$	29,330	$	2,455	$	(9,342	)	$	(9,430	)
Weighted-average basic shares outstanding	12,882,550		12,902,577		12,901,955			12,894,740
Weighted-average dilutive shares outstanding	13,934,941		13,924,210		12,901,955			12,894,740
Net income (loss) per share of Class A and Class B common stock:
Basic	$	2.11	$	0.18	$	(0.72	)	$	(0.73	)
Diluted	$	2.10	$	0.18	$	(0.72	)	$	(0.73	)
Cash dividends declared per share of common stock and common stock equivalents	$	0.16	$	0.16	$	0.16		$	0.16

	Three Months Ended
	April 30, 2016		January 31, 2016		October 31, 2015			July 31, 2015
	(In thousands, except per share amounts)
Revenue	$	104,414	$	53,621	$	7,871		$	7,523
Net income (loss)	$	32,288	$	4,738	$	(9,070	)	$	(8,536	)
Weighted-average basic shares outstanding	12,877,919		12,795,367		12,775,565			12,811,621
Weighted-average dilutive shares outstanding	13,967,568		14,002,356		12,775,565			12,811,621
Net income (loss) per share of Class A and Class B common stock:
Basic	$	2.33	$	0.34	$	(0.71	)	$	(0.67	)
Diluted	$	2.31	$	0.34	$	(0.71	)	$	(0.67	)
Cash dividends declared per share of common stock and common stock equivalents	$	0.16	$	0.16	$	0.16		$	0.16

Because most of the Company's customers file their tax returns during the period from January through April of each year, most of the Company's revenues are earned during this period. As a result, the Company generally operates at a loss through the first eight months of the fiscal year.

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Subsequent Events

12 Months Ended

Apr. 30, 2017

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

On June 12, 2017, the Company's Board of Directors approved a cash dividend of $0.16 per share payable on July 28, 2017 to holders of record of common stock and common stock equivalents on July 14, 2017.

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Organization and Significant Accounting Policies - Policy Text Blocks (Policies)

12 Months Ended

Apr. 30, 2017

Accounting Policies [Abstract]

Organization and Plan of Reorganization

Description of Business

Liberty Tax, Inc. (the "Company"), a Delaware corporation, is a holding company engaged through its subsidiaries as a franchisor and, to a lesser degree, an operator of a system of income tax preparation offices located in the United States and Canada. The Company's principal operations are conducted through JTH Tax, Inc. (d/b/a Liberty Tax Service), the Company's largest subsidiary. Through this system of income tax preparation offices, the Company also facilitates refund-based tax settlement financial products, such as refund transfer products in the U.S. and personal income tax refund discounting in Canada. The Company also offers online tax preparation services. In fiscal 2015, the Company changed its name from JTH Holding, Inc. to Liberty Tax, Inc.

The Company provides a substantial amount of lending to its franchisees and area developers ("ADs"). The Company allows franchisees and ADs to finance a portion of the initial franchise fee and AD fee, which are paid over time. The Company also offers its franchisees working capital loans to fund their operations.

Principles of Consolidation

Basis of Presentation

The consolidated financial statements include the accounts of Liberty Tax, Inc. and its wholly-owned subsidiaries. Assets and liabilities of the Company's Canadian operations have been translated into U.S. dollars using the exchange rate in effect at the end of the year. Revenues and expenses have been translated using the average exchange rates in effect each month of the year. Foreign exchange transaction gains and losses are recognized when incurred. The Company consolidates any entities in which it has a controlling interest, the usual condition of which is ownership of a majority voting interest. The Company also considers for consolidation an entity in which the Company has certain interest where a controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity ("VIE"), is required to be consolidated by its primary beneficiary. The Company does not possess any ownership interests in franchisee entities; however, the Company may provide financial support to franchisee entities. Because the Company's franchise arrangements provide franchisee entities the power to direct the activities that most significantly impact their economic performance, the Company does not consider itself the primary beneficiary of any such entity that might be a VIE. Based on the results of management's analysis of potential VIEs, the Company has not consolidated any franchisee entities. The Company's maximum exposure to loss resulting from involvement with potential VIEs is attributable to accounts and notes receivables and future lease payments due from franchisees. When the Company does not have a controlling interest in an entity but exerts significant influence over the entity, the Company applies the equity method of accounting. All intercompany balances and transactions have been eliminated in consolidation.

The audited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). In the opinion of management, all adjustments necessary for a fair presentation of such financial statements in accordance with GAAP have been recorded.

Office Count [Table Text Block]

Office Count

The following table shows the U.S. office activity, the number of processing centers and Canadian offices, and a breakdown of Company-owned and franchised offices for the 2017, 2016, and 2015 tax seasons.

	Tax Season
	2017		2016		2015
U.S. Office Locations:
Permanent Office Locations:
Operated during the prior tax season	3,960		3,764		3,663
Offices opened	172		453		397
Offices closed	(422	)	(257	)	(296	)
Operated during the current tax season	3,710		3,960		3,764
Seasonal Office Locations:
Operated during the prior tax season	211		262		486
Offices opened	37		127		118
Offices closed	(181	)	(178	)	(342	)
Operated during the current tax season	67		211		262
Processing Centers	46		54		43
Total U.S. Office Locations	3,823		4,225		4,069
Canada Office Locations	254		262		259
Total Office Locations	4,077		4,487		4,328
Additional Office Information:
Company-owned offices	362		310		182
Franchised offices	3,715		4,177		4,146
Total office locations	4,077		4,487		4,328

SiempreTax+, operated 159 offices during the 2017 tax season compared to 144 during the 2016 season and 57 in the 2015 season. These offices consist of second offices opened by current franchisees in territories they already owned, conversions of existing Liberty Tax offices, and offices opened in new territories.

Territory Sales Policy [Policy Text Block]

Territory Sales

The Company sold 73, 184, and 212 new territories during fiscal 2017, 2016 and 2015, respectively. New territories include territories sold to new franchisees and additional territories sold to existing franchisees.

Cash and Cash Equivalents

Cash and Cash Equivalents - The Company considers all highly liquid debt instruments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents are maintained in bank deposit accounts, which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on its cash and cash equivalents balances.

Trade Accounts Receivable

Accounts Receivable - Accounts receivable are recorded at the invoiced amount net of an allowance for doubtful accounts and accrue finance charges at a 12% annual rate, compounded monthly, if unpaid after 30 days. Account balances are charged off against the allowance after all possible means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its accounts receivable.

Notes Receivable

Notes Receivable - Notes receivable are recorded less unrecognized revenue, net of an allowance for doubtful accounts. Unrecognized revenue relates to the financed portion of franchise fees and AD fees and, in the case of sales of Company-owned offices, the financed portion of gains related to such sales in each case where revenue has not yet been recognized. Interest income is accrued on the unpaid principal balance.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Concentrations of credit risk - Financial instruments that could potentially subject the Company to concentrations of credit risk consist of accounts and notes receivable with its franchisees. The Company manages such risk by evaluating the financial position and value of the franchisees as well as obtaining the personal guarantee of the individual franchisees. At April 30, 2017 and 2016, there were no significant concentrations of credit risk associated with any individual franchisee or group of franchisees.

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts - The allowance for doubtful accounts includes the Company's best estimate of the amount of probable credit losses in the Company's existing accounts and notes receivable. Because the repayment of accounts and notes receivable is dependent on the performance of the underlying franchises, management estimates the amount of the allowance for doubtful accounts based on a comparison of amounts due to the estimated fair value of the underlying franchises which collateralize such receivables. Management believes the allowance is adequate to cover the Company's credit loss exposure. If the carrying amount exceeds the fair value, the receivable is considered impaired.

Available-for-sale Securities [Table Text Block]

Available-for-sale Securities - From time to time, the Company purchases corporate equity securities that are classified as available -for-sale; changes in fair value of such securities are recognized, net of tax, in accumulated other comprehensive income in the stockholders' equity section of the balance sheet. Cash flows for the purchase and sale of these investments are classified as investing activities.

Finance, Loan and Lease Receivables, Held-for-sale, Policy [Policy Text Block]

Assets Held for Sale - Assets held for sale consist of Company-owned offices that the Company intends to sell to a new or existing franchisee within one year. Assets held for sale are recorded at the lower of the carrying value or the estimated sales price, less costs to sell, and are evaluated for impairment at least annually. If in the opinion of management, the Company will not be able to sell such offices, within one year from the balance sheet date, the carrying amount is reclassified to held for use and a cumulative adjustment is recorded to depreciation and amortization expense. Additionally, in fiscal 2017, we transferred a building to assets held for sale as the building is up for sale.

Property, Equipment, and Software

Property, Equipment, and Software - Property, equipment, and software are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets, generally three to five years for computer equipment, three to seven years for software, five to seven years for furniture and fixtures, and twenty to thirty years for buildings. Leasehold improvements are amortized over the lesser of the lease term or the estimated useful lives of the assets. Certain allowable costs of software developed or obtained for internal use are capitalized and typically amortized over the estimated useful life of the software.

Goodwill

Goodwill - Goodwill represents the excess of costs over fair value of assets of businesses acquired. The reporting unit for the acquisition of assets from various franchisees is considered to be the franchise territory, and these assets are operated as Company-owned offices. Goodwill is not amortized, but instead tested for impairment at least annually. Goodwill is tested for impairment more frequently if events and circumstances indicate that the asset might be impaired. The Company performed its annual impairment testing as of April 30, 2017.

Investments

Deferred Revenue - Deferred revenue represents the amount of cash received for AD fees in excess of the revenue recognized.

Deferred Revenue and Revenue Recognition

Revenue Recognition - The Company earns revenue from the sales of franchises and granting of AD rights. Additionally, the Company earns revenue from royalties and advertising fees and other products and services. Typically, franchise rights are granted to franchisees for a term of five years with an option to renew at no additional cost. In exchange for franchise fees and royalties and advertising fees, the Company is obligated by its franchise agreements to provide training, an operations manual, site selection guidance, tax preparation software, operational assistance, tax and technical support, the ability to perform electronic filing, and marketing and advertising. Franchise fee revenue for the sales of individual territories is recognized when the obligations of the Company to prepare the franchisee for operation are substantially complete, up to the amount of cash received.

AD rights have historically been granted for a term of ten years. The Company changed the term of new and renewal AD contracts to six years in fiscal 2015. AD fees are recognized as revenue on a straight-line basis over the initial contract term of each AD agreement with the cumulative amount of revenue recognized not to exceed the amount of cash received. Amounts due to ADs for their services under an AD agreement are expensed as the related franchise fees and royalty revenues are recognized.

Royalties and advertising fees are recognized as franchise territories generate sales. Tax return preparation fees and financial products revenue are recognized as revenue in the period the related tax return is filed for the customer. Discounts for promotional programs are recorded at the time the return is filed and are recorded as reductions to revenues.

Interest income on notes receivable is recognized based on the outstanding principal note balance less unrecognized revenue unless it is put on non-accrual status. Interest income on the unrecognized revenue portion of notes receivable is recognized when received. For accounts receivable, interest income is recognized based on the outstanding receivable balance over 30 days old, net of an allowance.

Gains on sales of Company-owned offices are recognized when cash is received. Losses on sales of Company-owned offices are recognized immediately.

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities - The Company recognizes all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values. For derivatives designated in hedging relationships, changes in fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income to the extent the derivative is effective at offsetting the changes in cash flows being hedged until the hedged item affects earnings.

The Company only enters into a derivative contract when it intends to designate the contract as a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument's effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk; the derivative expires or is sold, terminated, or exercised; the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring; or management determines to remove the designation of the cash flow hedge.

In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is no longer probable that a forecasted transaction will occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in other comprehensive income related to the hedging relationship.

Please see "Note 8 - Derivative Instruments and Hedging Activates" for a description of the cash flow hedge the Company entered into during fiscal 2017.

The Company did not have any outstanding derivative instruments or hedging activities as of April 30, 2016.

Income Taxes

Deferred Income Taxes - Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities, which are shown on our consolidated balance sheets, are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company has elected to classify interest charged on a tax settlement in interest expense, and accrued penalties, if any, in selling, general, and administrative expenses.

The determination of our provision for income taxes requires significant judgment, the use of estimates, and the interpretation and application of complex tax laws. Significant judgment is required in assessing the timing and amounts of deductible and taxable items.  We record unrecognized tax benefit liabilities for known or anticipated tax issues based on our analysis of whether, and the extent to which, additional taxes will be due.

Long-Lived Assets

Intangible Assets and Other Long-Lived Assets - Amortization on intangible assets is calculated using the straight-line method over the estimated useful lives of the assets, generally from two to ten years. Long-lived assets, such as property, equipment, and software, and other purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. Recognition and measurement of a potential impairment is performed for these assets at the lowest level where cash flows are individually identifiable. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary. Assets expected to be sold within one year are no longer depreciated or amortized. These assets are classified as held-for-sale and are presented separately in the appropriate section of the consolidated balance sheets at the lower of their carrying amount or fair value less estimated cost to sell.

Comprehensive Income

Comprehensive Income - Comprehensive income consists of net income, foreign currency translation adjustments, reclassified gain on sale of available-for-sale securities, net of taxes, and the unrealized gains or losses on equity securities available for sale and derivatives determined to be cash flow hedges, net of taxes

Advertising Expenses

Advertising Expenses - Advertising costs, which consists of direct mail, radio, print media and online advertisements intended to attract new franchisees and customers, are expensed in the period incurred.

Office Closing Costs [Policy Text Block]

Office Closing Costs - Closed office liabilities are provided on the basis of the present value of estimated remaining non-cancellable lease payments, net of estimated subtenant income. An estimate the net lease liability using a discount rate to calculate the present value of the remaining net rent payments on closed offices. Closed office lease liabilities are paid over the lease terms associated with the closed offices, which generally have remaining terms ranging from one to seven years.

Stock-Based Compensation

Stock-Based Compensation - The Company records the cost of its employee stock-based compensation as compensation expense in its consolidated statements of income. Compensation costs related to stock options are based on the grant-date fair value of awards using the Black-Scholes-Merton option pricing model and considering forfeitures. Compensation costs related to restricted stock units are based on the grant-date fair value and are amortized on a straight-line basis over the vesting period. For liability classified awards the Company records costs based on the fair value at the reporting date. The Company recognizes compensation costs for an equity-classified award that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award; changes in the fair value liability-classified awards are recognized as they occur. The Company reflects the excess tax benefits related to stock option exercises as additional paid-in capital on its consolidated balance sheets and as financing cash flows on its consolidated statements of cash flows.

Use of Estimates

Use of Estimates

Management has made a number of estimates and assumptions related to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period to prepare these consolidated financial statements and accompanying notes in conformity with GAAP. Actual results could differ from those estimates.

Recently Issued Accounting Standards

Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers." This update will replace existing revenue recognition guidance in GAAP and requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The new standard is effective for the Company in fiscal year 2019, which begins on May 1, 2018. The standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption ("modified retrospective method"). The Company currently expects to apply the modified retrospective transition method upon adoption. The Company expects the adoption of the new guidance to change the timing of recognition of initial franchise fees and AD fees. Currently, franchise fees are generally recognized when our obligations to prepare the franchise for operation have been substantially completed and cash has been received and AD fees are recognized on the straight-line basis over the contract term not to exceed the amount of cash received. The new guidance will generally require these fees to be recognized over the term of the related franchise or AD agreements, which will impact the revenue recognized for franchise fees. The Company does not expect this new guidance to materially impact the recognition of royalty and advertising fees, financial products revenue or tax preparation fees. The Company is continuing to evaluate the impact the adoption of this new guidance will have on these and other revenue transactions, in addition to the impact on accounting policies and related disclosures.

In November 2015 the FASB issued ASU 2015-17, "Balance Sheet Classification of Deferred Taxes (Topic 740)," which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as non-current. This ASU is effective for interim and annual periods in fiscal years beginning after December 15, 2016, which means that it will be effective for the Company in the first quarter of its fiscal year beginning May 1, 2017.

In February 2016, the FASB issued ASU No. 2016-02, "Leases." This update will replace existing lease guidance in GAAP and will require lessees to recognize lease assets and lease liabilities on the balance sheet for all leases and disclose key information about leasing arrangements, such as information about variable lease payments and options to renew and terminate leases. When implemented, lessees and lessors will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The update is effective for interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently finalizing its implementation plan and evaluating the impact of the new pronouncement on its consolidated financial statements. The Company expects the adoption of this pronouncement to result in a material increase in the assets and liabilities on its consolidated balance sheets and to not have a material impact on its consolidated income statements.

In May 2016, the Company adopted Accounting Standards Update ("ASU") 2015-03, "Simplifying the Presentation of Debt Issuance Costs", which requires that debt issuance costs related to a recognized debt liability to be presented on the balance sheet as a direct deduction from the debt liability, similar to the presentation of debt premiums and discounts, and ASU 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements", which further clarifies the presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-03 and ASU 2015-15 applies retrospectively and does not change the recognition and measurement requirements for debt issuance costs. The adoption of ASU 2015-03 and ASU 2015-15 resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's borrowings from other assets to long-term obligations within our consolidated balance sheet as of January 31, 2017, April 30, 2016 and January 31, 2016, respectively.

In May 2016, the Company adopted ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis", which effectively eliminates the presumption that a general partner should consolidate a limited partnership, modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIE"s) or voting interest entities, and affects the consolidation analysis of reporting entities that are involved with VIEs (particularly those that have fee arrangements and related party relationships). The Company has completed its evaluation and has concluded there is no material impact from the adoption of the new standard on its consolidated financial statements.

In March 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-09, "Improvements to Employee Share Based Payment Accounting (Topic 718)", to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard will be effective for the Company beginning with its first quarterly filing in fiscal year 2018. Early adoption is permitted, including adoption in an interim period prior to fiscal 2018. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230)", which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. The update is intended to reduce the existing diversity in practice and is effective for the Company beginning with its first quarterly filing in fiscal year 2019. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, "Measurement of Credit Losses on Financial Instruments", which changes how companies will measure credit losses for most financial assets and certain other instruments that aren't measured at fair value through net income. The standard replaces the "incurred loss" approach with an "expected loss" model for instruments measured at amortized cost (which generally will result in the earlier recognition of allowances for losses) and requires companies to record allowances for available-for-sale debt securities, rather than reduce the carrying amount. In addition, companies will have to disclose significantly more information, including information used to track credit quality by year of origination, for most financing receivables. The ASU should be applied as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the standard is effective. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods therein. The ASU is effective for the Company beginning in the first quarter of fiscal year 2021. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” This new standard eliminates Step 2 from the goodwill impairment test. Instead, an entity should compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The standard will be effective for the Company in the first quarter of our fiscal year 2021. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this newly issued standard to its consolidated financial statements.

Segment Reporting

Segment Reporting

Management has identified two operating segments, U.S. operations and Canadian operations. Although there are two operating segments, each segment is engaged in providing tax return preparation and related services and products. These two operating segments, which have similar gross margin and sales trends, have been aggregated into a single reporting segment because both segments are similar in the nature of services offered, production process, type of customer, the distribution methods, and the regulatory environment in which they operate. Canadian operations contributed $7.0 million, $7.0 million, and $6.9 million in revenues for the years ended April 30, 2017, 2016, and 2015, respectively.

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Organization and Significant Accounting Policies - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Accounting Policies [Abstract]

Office Count Rollforward

The following table shows the U.S. office activity, the number of processing centers and Canadian offices, and a breakdown of Company-owned and franchised offices for the 2017, 2016, and 2015 tax seasons.

	Tax Season
	2017		2016		2015
U.S. Office Locations:
Permanent Office Locations:
Operated during the prior tax season	3,960		3,764		3,663
Offices opened	172		453		397
Offices closed	(422	)	(257	)	(296	)
Operated during the current tax season	3,710		3,960		3,764
Seasonal Office Locations:
Operated during the prior tax season	211		262		486
Offices opened	37		127		118
Offices closed	(181	)	(178	)	(342	)
Operated during the current tax season	67		211		262
Processing Centers	46		54		43
Total U.S. Office Locations	3,823		4,225		4,069
Canada Office Locations	254		262		259
Total Office Locations	4,077		4,487		4,328
Additional Office Information:
Company-owned offices	362		310		182
Franchised offices	3,715		4,177		4,146
Total office locations	4,077		4,487		4,328

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Accounts and Notes Receivable - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Receivables [Abstract]

Schedule of activity related to notes receivable

Notes and interest receivable, net of unrecognized revenue, as of April 30, 2017 and 2016 are presented in the consolidated balance sheets as follows:

	2017		2016
	(In thousands)
Notes receivable - current	$	27,845	$	26,710
Notes receivable - non-current	18,213		25,514
Interest receivable, net of uncollectible amounts	1,967		1,944
Total notes and interest receivable, net of unrecognized revenue	$	48,025	$	54,168

Schedule of activity in the allowance for doubtful accounts

Activity in the allowance for doubtful accounts for the years ended April 30, 2017, 2016, and 2015 was as follows.

	2017			2016			2015
	(In thousands)
Balance at beginning of year	$	8,850		$	7,355		$	6,850
Provision for doubtful accounts	10,378			7,282			5,726
Write-offs	(7,119		)	(5,737		)	(5,122		)
Foreign currency adjustment	(89		)	(50		)	(99		)
Balance at end of year	$	12,020		$	8,850		$	7,355

Schedule of allocation of allowance for doubtful accounts

In establishing the fair value of the underlying franchise, management considers a variety of factors including recent sales of Company-owned stores, recent sales between franchisees, net fees of open offices earned during the most recently completed tax season, and the number of unopened offices.

The allowance for doubtful accounts at April 30, 2017 and 2016 was allocated as follows.

	2017			2016
	(In thousands)
Impaired:
Accounts receivable	$	11,396		$	7,083
Notes and interest receivable, net of unrecognized revenue	14,646			12,960
Less amounts due to ADs and franchisees	(1,834		)	(1,426		)
Amounts receivable less amounts due to ADs and franchisees	$	24,208		$	18,617
Allowance for doubtful accounts for impaired accounts and notes receivable	$	9,542		$	7,787
Non-impaired:
Accounts receivable	$	43,327		$	42,825
Notes and interest receivable, net of unrecognized revenue	33,379			41,208
Less amounts due to ADs and franchisees	(23,119		)	(26,183		)
Amounts receivable less amounts due to ADs and franchisees	$	53,587		$	57,850
Allowance for doubtful accounts for non-impaired accounts and notes receivable	$	2,478		$	1,063
Total:
Accounts receivable	$	54,723		$	49,908
Notes and interest receivable, net of unrecognized revenue	48,025			54,168
Less amounts due to ADs and franchisees	(24,953		)	(27,609		)
Amounts receivable less amounts due to ADs and franchisees	$	77,795		$	76,467
Total allowance for doubtful accounts	$	12,020		$	8,850

Schedule of aging of accounts and notes receivable

The breakdown of accounts and notes receivable past due at April 30, 2017 and 2016 was as follows.

	2017
	Past due		Current		Interest receivable, net		Total receivables
	(In thousands)
Accounts receivable	$	28,892	$	25,831	$	—	$	54,723
Notes and interest receivable, net	7,034		39,024		1,967		48,025
Total accounts, notes, and interest receivable, net	$	35,926	$	64,855	$	1,967	$	102,748

	2016
	Past due		Current		Interest receivable, net		Total receivables
	(In thousands)
Accounts receivable	$	24,712	$	25,196	$	—	$	49,908
Notes and interest receivable, net	6,142		46,082		1,944		54,168
Total accounts, notes, and interest receivable, net	$	30,854	$	71,278	$	1,944	$	104,076

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Property, Equipment, and Software, Net - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Property, Plant and Equipment [Abstract]

Schedule of future minimum rental payments for operating leases

At April 30, 2017, future minimum lease payments under non-cancelable operating leases with initial or remaining lease terms in excess of one year, together with amounts due from franchisees under subleases, were as follows:

	Lease payments		Sublease receipts
	(In thousands)
Year ending April 30:
2018	$	9,518	$	4,352
2019	5,885		2,733
2020	3,455		1,785
2021	1,591		726
2022	670		344
Thereafter	263		150
Total minimum lease payments	$	21,382	$	10,090

Schedule of property, equipment, and software

Property, equipment, and software at April 30, 2017 and 2016 was as follows:

	2017		2016
	(In thousands)
Land and land improvements	$	1,464	$	2,413
Buildings and building improvements	7,964		8,733
Leasehold improvements	132		138
Furniture, fixtures, and equipment	5,788		6,307
Software	50,413		44,418
Property, equipment, and software, gross	65,761		62,009
Less accumulated depreciation and amortization	25,972		21,052
Property, equipment, and software, net	$	39,789	$	40,957

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Goodwill and Intangible Assets - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Allocation of Impairment Loss [Table Text Block]

Components of amortizable intangible assets as of April 30, 2017 and 2016 were as follows:

	April 30, 2017
	Weighted average amortization period	Gross carrying amount		Accumulated amortization			Net carrying amount
	(In thousands)
Customer lists acquired from unrelated third parties	4 years	$	2,827	$	(899	)	$	1,928
Assets acquired from franchisees:
Customer lists	4 years	1,189		(908		)	281
Reacquired rights	2 years	935		(919		)	16
AD rights	10 years	26,427		(7,428		)	18,999
Total intangible assets		$	31,378	$	(10,154	)	$	21,224

	April 30, 2016
	Weighted average amortization period	Gross carrying amount		Accumulated amortization			Net carrying amount
	(In thousands)
Customer lists acquired from unrelated third parties	4 years	$	1,027	$	(339	)	$	688
Assets acquired from franchisees:
Customer lists	4 years	1,380		(500		)	880
Reacquired rights	2 years	511		(482		)	29
AD rights	10 years	20,218		(5,545		)	14,673
Total intangible assets		$	23,136	$	(6,866	)	$	16,270

Schedule of Goodwill

Changes in the carrying amount of goodwill for the years ended April 30, 2017 and 2016 were as follows:

	2017			2016
	(In thousands)
Balance at beginning of year	$	4,228		$	3,377
Acquisitions of assets from franchisees and third parties	3,649			960
Disposals and foreign currency changes, net	(226		)	(52		)
Impairments	(184		)	(57		)
Reclassified from assets held for sale	1,109			—
Balance at end of year	$	8,576		$	4,228

Purchase Price of Assets Acquired from Franchisees

The purchase price of assets acquired from franchisees and third parties and recorded as customer lists, reacquired rights, and goodwill and held for use during fiscal 2017 and 2016, was allocated as follows.

	2017		2016
	(In thousands)
Customer lists	$	13	$	728
Reacquired rights	11		39
Goodwill	25		1,048
Purchase price of assets acquired from franchisees, not held for sale	$	49	$	1,815

Schedule of estimated amortization expense

Annual amortization expense for the next five years is estimated to be as follows (in thousands):

Year ending April 30:
2018	$	3,664
2019	3,438
2020	3,109
2021	2,559
2022	2,269
Total estimated amortization expense	$	15,039

XML

Assets Held for Sale - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Assets Held for Sale [Abstract]

Carrying amounts of assets HFS

Changes in the carrying amounts of assets held for sale for the fiscal years ended April 30, 2017 and 2016 were as follows:

	2017			2016
	(In thousands)
Balance at beginning of year	$	9,886		$	5,160
Reacquired, acquired from third parties, and other	16,600			13,309
Dispositions	(7,994		)	(6,526		)
Impairment	(5,663		)	(2,057		)
Transferred to assets held for use	(2,428		)	—
Transferred from property and equipment	1,588			—
Balance at end of year	$	11,989		$	9,886

XML

Debt - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Debt Disclosure [Abstract]

Schedule of long-term debt

Debt at April 30, 2017 and 2016 was as follows:

	2017		2016
	(In thousands)
Term loan payable in quarterly principal installments of 2.50%, and 3.13% of the original amount borrowed for the years ending April 30, 2018 and 2019, respectively; on April 30, 2019 a balloon payment of $13,016 is payable.	$	17,471	$	18,884
Mortgage note payable to a bank in monthly installments ranging from $10 to $14 including interest at LIBOR plus 1.85%, which was 2.84% at April 30, 2017, through December 1, 2026; at that time a balloon payment of $779 is payable; subject to a prepayment penalty; collateralized by land and building.	2,160		—
Mortgage note payable to a bank in monthly installments of $16 including interest at 6.06% through September 2016; at that time a balloon payment of $2,213 is payable; subject to a prepayment penalty; collateralized by land and building.	—		2,230
Amounts due to former ADs, franchisees and third parties at zero percent interest; due May 2017 through April 2020.	6,568		2,317
Other debt	—		9
Total long-term obligations	26,199		23,440
Less current installments	7,738		5,947
Total long-term obligations, less current installments	$	18,461	$	17,493

Schedule of aggregate maturities of long-term debt

Aggregate maturities of long-term debt at April 30, 2017 were as follows (in thousands):

Year ending April 30:
2018	$	7,738
2019	16,510
2020	171
2021	136
2022	140
Thereafter	1,504
Total long-term debt	$	26,199

XML

Stockholders' Equity - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

The components of accumulated other comprehensive loss at April 30, 2017 and 2016 are as follows.

	2017			2016
	(In thousands)
Foreign currency adjustment	$	(2,059	)	$	(1,148	)
Unrealized loss on equity securities available for sale, net of taxes	30			(550		)
Gain on sale of available-for-sale securities, net of taxes	(30		)	—
Interest rate swap agreements, net of tax	(25		)	—
Total accumulated other comprehensive loss	$	(2,084	)	$	(1,698	)

Schedule of computation of basic and diluted net income per share

The computation of basic and diluted net income per share for the years ended April 30, 2017, 2016, and 2015 is as follows.

	2017
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	12,745		$	268
Amounts allocated to participating securities:
Exchangeable shares	(917		)	(19		)
Net income attributable to common stockholders	$	11,828		$	249
Denominator:
Weighted-average common shares outstanding	12,630,356			265,205
Basic net income per share	$	0.94		$	0.94
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	11,828		$	249
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	249			—
Exchangeable shares to Class A common stock	936			—
Net income attributable to stockholders	$	13,013		$	249
Denominator:
Number of shares used in basic computation	12,630,356			265,205
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	265,205			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	21,347			407
Weighted-average diluted shares outstanding	13,916,908			265,612
Diluted net income per share	$	0.94		$	0.94

	2016
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	18,056		$	1,364
Amounts allocated to participating securities:
Exchangeable shares	(1,307		)	(99		)
Net income attributable to common stockholders	$	16,749		$	1,265
Denominator:
Weighted-average common shares outstanding	11,914,775			900,000
Basic net income per share	$	1.41		$	1.41
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	16,749		$	1,265
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	1,265			—
Exchangeable shares to Class A common stock	1,406			—
Net income attributable to stockholders	$	19,420		$	1,265
Denominator:
Number of shares used in basic computation	11,914,775			900,000
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	900,000			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	209,896			13,674
Weighted-average diluted shares outstanding	14,024,671			913,674
Diluted net income per share	$	1.38		$	1.38

	2015
	Class A common stock			Class B common stock
	(In thousands, except for share and per share amounts)
Basic net income per share:
Numerator:
Allocation of undistributed earnings	$	8,076		$	614
Amounts allocated to participating securities:
Exchangeable shares	(588		)	(45		)
Net income attributable to common stockholders	$	7,488		$	569
Denominator:
Weighted-average common shares outstanding	11,838,887			900,000
Basic net income per share	$	0.63		$	0.63
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic computation	$	7,488		$	569
Reallocation of undistributed earnings as a result of assumed conversion of:
Class B common stock to Class A common stock	569			—
Exchangeable shares to Class A common stock	633			—
Net income attributable to stockholders	$	8,690		$	569
Denominator:
Number of shares used in basic computation	11,838,887			900,000
Weighted-average effect of dilutive securities:
Class B common stock to Class A common stock	900,000			—
Exchangeable shares to Class A common stock	1,000,000			—
Employee stock options and restricted stock units	555,886			36,415
Weighted-average diluted shares outstanding	14,294,773			936,415
Diluted net income per share	$	0.61		$	0.61

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Stock Compensation Plan - Table Text Blocks (Tables)

12 Months Ended

Apr. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of information for options granted

The following table summarizes the information for options granted in the years ended April 30, 2017, 2016, and 2015.

	2017	2016	2015
Weighted-average fair value of options granted	$2.45	$5.05	$9.59
Dividend yield	5.0% - 6.1%	2.8% - 3.7%	0.0% - 2.2%
Expected volatility	32.8% - 35.4%	32.4% - 35.6%	31.1% - 31.7%
Expected terms	5 - 6 years	4 - 6 years	5 years
Risk-free interest rates	1.2% - 2.1%	1.4% - 1.7%	1.6% - 1.9%

Schedule of stock option activity

Stock option activity during the years ended April 30, 2017, 2016, and 2015 was as follows:

	Number of options		Weighted average exercise price
Outstanding at April 30, 2014	1,940,406		$	16.68
Granted	170,416		32.87
Exercised	(761,913	)	15.73
Forfeited or expired	(5,350	)	15.00
Outstanding at April 30, 2015	1,343,559		19.28
Granted	227,387		22.30
Exercised	(154,594	)	14.79
Forfeited or expired	(151,790	)	24.31
Outstanding at April 30, 2016	1,264,562		19.77
Granted	512,119		12.61
Exercised	—		—
Forfeited or expired	(389,350	)	16.59
Outstanding at April 30, 2017	1,387,331		$	18.02

Schedule of nonvested (options that did not vest in the period in which granted) stock option activity

Nonvested stock options (options that had not vested in the period reported) activity during the years ended April 30, 2017, 2016, and 2015 was as follows:

	Nonvested options		Weighted average exercise price
Outstanding at April 30, 2014	485,000		$	20.92
Granted	170,416		32.87
Vested	(270,000	)	18.99
Forfeited	—		—
Outstanding at April 30, 2015	385,416		27.56
Granted	227,387		22.30
Vested	(173,750	)	25.16
Forfeited	(50,000	)	33.79
Outstanding at April 30, 2016	389,053		24.76
Granted	512,119		12.61
Vested	(223,054	)	23.88
Forfeited	—		—
Outstanding at April 30, 2017	678,118		$	15.88

Summary of information about stock options outstanding and exercisable

The following table summarizes information about stock options outstanding and exercisable at April 30, 2017.

	Options outstanding				Options exercisable
Range of Exercise Prices	Number of options outstanding	Weighted average exercise price		Weighted average remaining contractual life (in years)	Number of options exercisable	Weighted average exercise price
10.51 to 15.00	706,712	$	13.27	4.7	194,593	$	15.00
16.38 - 19.75	284,816	17.93		3.0	266,816	17.96
22.18 - 29.48	330,387	25.22		4.5	212,387	25.15
33.38	65,416	33.38		4.5	35,417	33.38
	1,387,331	$	18.02		709,213	$	20.07

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block]

Restricted stock activity during the years ended April 30, 2017, 2016 and 2015 was as follows.

	Number of RSUs		Weighted Average Fair Value at Grant Date
Balance at April 30, 2014	21,445		$	16.87
Granted	25,691		33.38
Vested	(14,746	)	16.38
Forfeited	(3,461	)	26.47
Balance at April 30, 2015	28,929		30.63
Granted	32,056		23.06
Vested	(13,394	)	27.99
Forfeited	(4,799	)	27.89
Balance at April 30, 2016	42,792		26.10
Granted	165,454		12.62
Vested	(17,118	)	24.58
Forfeited	(14,732	)	25.94
Balance at April 30, 2017	176,396		$	13.61

XML

Fair Value of Financial Instruments (Tables)

12 Months Ended

Apr. 30, 2017

Fair Value Disclosures [Abstract]

Schedule of the assets and liabilities that are measured at fair value on a recurring and nonrecurring basis, for each of the fair value hierarchy levels

The following tables present, for each of the fair value hierarchy levels, the assets and liabilities that are measured at fair value on a recurring and nonrecurring basis at April 30, 2017 and 2016.

			April 30, 2017 Fair value measurements using
	Total		Level 1		Level 2		Level 3
	(In thousands)
Recurring assets:
Cash equivalents	$	10,393	$	10,393	$	—	$	—
Total recurring assets	10,393		10,393		—		—
Nonrecurring assets:
Impaired accounts and notes receivable, net of unearned revenue	16,500		—		—		16,500
Impaired goodwill	94		—		—		94
Impaired customer lists	18		—		—		18
Assets held for sale	11,989		—		—		11,989
Total nonrecurring assets	28,601		—		—		28,601
Total recurring and nonrecurring assets	$	38,994	$	10,393	$	—	$	28,601
Recurring liabilities
Contingent consideration included in obligations due former ADs, franchisees and others	3,215		—		—		3,215
Total recurring liabilities	$	3,215	$	—	$	—	$	3,215

			April 30, 2016 Fair value measurements using
	Total		Level 1		Level 2		Level 3
	(In thousands)
Recurring assets:
Cash equivalents	$	7,140	$	7,140	$	—	$	—
Available-for-sale securities	4,123		4,123		—		—
Total recurring assets	11,263		11,263		—		—
Nonrecurring assets:
Impaired accounts and notes receivable, net of unearned revenue	12,256		—		—		12,256
Impaired goodwill	63		—		—		63
Impaired reacquired rights	28		—		—		28
Impaired customer lists	34		—		—		34
Assets held for sale	9,886		—		—		9,886
Total nonrecurring assets	22,267		—		—		22,267
Total recurring and nonrecurring assets	$	33,530	$	11,263	$	—	$	22,267

XML

Income Taxes (Tables)

12 Months Ended

Apr. 30, 2017

Income Tax Disclosure [Abstract]

Schedule of total income taxes

Total income taxes were calculated for the years ended April 30, 2017, 2016, and 2015 as follows.

	2017		2016			2015
	(In thousands)
Income tax expense	$	7,754	$	11,058		$	4,811
Tax impact of stock option activity	378		(900		)	(4,803		)
Unrealized gain (loss) on available-for-sale securities	—		(326		)	—
Total income taxes	$	8,132	$	9,832		$	8

Schedule of components of income tax expense

Components of income tax expense for the years ended April 30, 2017, 2016, and 2015 were as follows.

	2017			2016			2015
	(In thousands)
Current:
Federal	$	6,125		$	2,748		$	5,973
State	1,160			598			2,157
Foreign	293			328			226
Current tax expense	7,578			3,674			8,356
Deferred:
Federal	315			6,079			(2,629		)
State	(183		)	1,322			(950		)
Foreign	44			(17		)	34
Deferred tax expense (benefit)	176			7,384			(3,545		)
Total income tax expense	$	7,754		$	11,058		$	4,811

Schedule of income before taxes, domestic and foreign

For the years ended April 30, 2017, 2016, and 2015, income before taxes consisted of the following.

	2017		2016		2015
	(In thousands)
U.S. operations	$	19,558	$	28,954	$	12,459
Foreign operations	1,209		1,524		1,042
Income before income taxes	$	20,767	$	30,478	$	13,501

Schedule of reconciliation of amounts computed by applying the U.S. federal income tax rate to pretax income from continuing operations

Income tax expense differed from the amounts computed by applying the U.S. federal income tax rate of 35% to pretax income from continuing operations as a result of the following for the years ended April 30, 2017, 2016, and 2015.

	2017			2016			2015
	(In thousands)
Computed "expected" income tax expense	$	7,269		$	10,667		$	4,725
Increase (decrease) in income taxes resulting from:
State income taxes, net of federal benefit	634			1,126			1,034
Nondeductible expenses	211			246			308
Tax credits	(140		)	(370		)	(251		)
Domestic production deduction	(158		)	(538		)	(466		)
Stock compensation expense	58			31			(378		)
Foreign tax rate differential	(86		)	(222		)	(104		)
Rate change	(64		)	—			18
Other	30			118			(75		)
Total income tax expense	$	7,754		$	11,058		$	4,811

Schedule of significant portions of deferred tax assets and liabilities

The tax effect of temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities that give rise to significant portions of deferred tax assets and liabilities at April 30, 2017 and 2016 are as follows:

	2017			2016
	(In thousands)
Deferred tax assets:
Deferred revenue	$	11,286		$	1,236
Allowance for doubtful accounts	5,136			3,707
Goodwill, intangible assets, and assets held for sale	3,140			—
Unexercised nonqualified stock options	2,260			2,292
Accounts payable and accrued expense	1,954			594
Net operating loss	148			—
Total deferred tax assets	23,924			7,829
Deferred tax liabilities:
Property, equipment and software	12,916			10,285
Section 481(a) adjustment - change in accounting method	11,729			—
Intangible assets	2,048			—
Other current assets	505			370
Deferred contingencies	137			—
Total deferred tax liabilities	27,335			10,655
Net deferred tax liability	$	(3,411	)	$	(2,826	)

XML

Related Party Transactions (Tables)

12 Months Ended

Apr. 30, 2017

Related Party Transactions [Abstract]

Schedule of repurchase of common stock from related parties

For the years ended April 30, 2017, 2016, and 2015, the Company repurchased common stock from related parties as follows.

	2017		2016		2015
	(In thousands)
Common stock:
Shares repurchased	30		—		1,007
Amount	$	378	$	—	$	26,954

XML

Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Apr. 30, 2017

Quarterly Financial Data [Abstract]

Schedule of quarterly financial data

	Three Months Ended
	April 30, 2017		January 31, 2017		October 31, 2016			July 31, 2016
	(In thousands, except per share amounts)
Revenue	$	111,179	$	48,423	$	7,234		$	7,149
Net income (loss)	$	29,330	$	2,455	$	(9,342	)	$	(9,430	)
Weighted-average basic shares outstanding	12,882,550		12,902,577		12,901,955			12,894,740
Weighted-average dilutive shares outstanding	13,934,941		13,924,210		12,901,955			12,894,740
Net income (loss) per share of Class A and Class B common stock:
Basic	$	2.11	$	0.18	$	(0.72	)	$	(0.73	)
Diluted	$	2.10	$	0.18	$	(0.72	)	$	(0.73	)
Cash dividends declared per share of common stock and common stock equivalents	$	0.16	$	0.16	$	0.16		$	0.16

	Three Months Ended
	April 30, 2016		January 31, 2016		October 31, 2015			July 31, 2015
	(In thousands, except per share amounts)
Revenue	$	104,414	$	53,621	$	7,871		$	7,523
Net income (loss)	$	32,288	$	4,738	$	(9,070	)	$	(8,536	)
Weighted-average basic shares outstanding	12,877,919		12,795,367		12,775,565			12,811,621
Weighted-average dilutive shares outstanding	13,967,568		14,002,356		12,775,565			12,811,621
Net income (loss) per share of Class A and Class B common stock:
Basic	$	2.33	$	0.34	$	(0.71	)	$	(0.67	)
Diluted	$	2.31	$	0.34	$	(0.71	)	$	(0.67	)
Cash dividends declared per share of common stock and common stock equivalents	$	0.16	$	0.16	$	0.16		$	0.16

XML

Organization and Significant Accounting Policies - Number of Processing Centers and Offices (Details) - office	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Franchisor Disclosure [Line Items]
Offices	4,077	4,487	4,328
UNITED STATES
Franchisor Disclosure [Line Items]
Offices	3,823	4,225	4,069
UNITED STATES | Permanent Office
Franchisor Disclosure [Line Items]
Offices	3,710	3,960	3,764
Permanent Office Locations:	172	453	397
Offices closed	(422)	(257)	(296)
UNITED STATES | permanent, prior year [Member]
Franchisor Disclosure [Line Items]
Offices	3,960	3,764	3,663
UNITED STATES | Seasonal Office
Franchisor Disclosure [Line Items]
Offices	67	211	262
Permanent Office Locations:	37	127	118
Offices closed	(181)	(178)	(342)
UNITED STATES | seasonalpriortaxseason [Member]
Franchisor Disclosure [Line Items]
Offices	211	262	486
UNITED STATES | Processing Center
Franchisor Disclosure [Line Items]
Offices	46	54	43
UNITED STATES | Company Owned
Franchisor Disclosure [Line Items]
Offices	362	310	182
UNITED STATES | Franchise Owned
Franchisor Disclosure [Line Items]
Offices	3,715	4,177	4,146
CANADA
Franchisor Disclosure [Line Items]
Offices	254	262	259

XML

Organization and Significant Accounting Policies - Narratives (Details) $ in Thousands	3 Months Ended								12 Months Ended
	Apr. 30, 2017 USD ($) office	Jan. 31, 2017 USD ($)	Oct. 31, 2016 USD ($)	Jul. 31, 2016 USD ($)	Apr. 30, 2016 USD ($) office	Jan. 31, 2016 USD ($)	Oct. 31, 2015 USD ($)	Jul. 31, 2015 USD ($)	Apr. 30, 2017 USD ($) territory office operating_segment	Apr. 30, 2016 USD ($) territory office	Apr. 30, 2015 USD ($) territory office
Property, Equipment, and Software
Unamortized Debt Issuance Expense | $	$ 100								$ 100
Territories Sold | territory									73	184	212
Offices	4,077				4,487				4,077	4,487	4,328
Trade Accounts Receivable Annual Finance Charges Percentage									12.00%
Period after which unpaid trade accounts receivable accrue finance charges									30 days
Franchise rights term									5 years
Developer rights term									6 years		10 years
Number of operating segments | operating_segment									2
Total revenues | $	$ 111,179	$ 48,423	$ 7,234	$ 7,149	$ 104,414	$ 53,621	$ 7,871	$ 7,523	$ 173,985	$ 173,429	$ 162,172
UNITED STATES
Property, Equipment, and Software
Offices	3,823				4,225				3,823	4,225	4,069
CANADA
Property, Equipment, and Software
Offices	254				262				254	262	259
Total revenues | $									$ 7,000	$ 7,000	$ 6,900
SiempreTax [Member] | UNITED STATES
Property, Equipment, and Software
Offices	159				144				159	144	57
Minimum
Property, Equipment, and Software
Lease Term									one
Finite-Lived Intangible Asset, Useful Life									2 years
Maximum
Property, Equipment, and Software
Lease Term									seven
Finite-Lived Intangible Asset, Useful Life									10 years
Computer equipment | Minimum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									3 years
Computer equipment | Maximum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									5 years
Software | Minimum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									3 years
Software | Maximum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									7 years
Furniture, fixtures, and equipment | Minimum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									5 years
Furniture, fixtures, and equipment | Maximum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									7 years
Building | Minimum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									20 years
Building | Maximum
Property, Equipment, and Software
Estimated useful lives of the depreciable assets									30 years

XML

Accounts and Notes Receivable - Notes and Interest Receivable (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2015	Apr. 30, 2016
Receivables [Abstract]
Developer Rights Term	6 years	10 years
Notes receivable - current	$ 27,845		$ 26,710
Notes receivable - non-current	18,213		25,514
Interest receivable, net of uncollectible amounts	1,967		1,944
Total notes and interest receivable, net	$ 48,025		$ 54,168

XML

Accounts and Notes Receivable - Activity in the Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Receivables [Abstract]
Allowance for doubtful accounts receivable, beginning of period	$ 8,850	$ 7,355	$ 6,850
Provision for doubtful accounts	10,378	7,282	5,726
Write-offs	(7,119)	(5,737)	(5,122)
Foreign currency adjustment	(89)	(50)	(99)
Allowance for doubtful accounts receivable, end of period	$ 12,020	$ 8,850	$ 7,355

XML

Accounts and Notes Receivable - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015	Apr. 30, 2014
Allocation of allowance for doubtful accounts
Gross amount due	$ 102,748	$ 104,076
Less amounts due to ADs and franchisees	(24,953)	(27,609)
Amounts receivable less amounts due to ADs and franchisees	77,795	76,467
Allowance for Doubtful Accounts Receivable	12,020	8,850	$ 7,355	$ 6,850
Impaired:
Allocation of allowance for doubtful accounts
Less amounts due to ADs and franchisees	(1,834)	(1,426)
Amounts receivable less amounts due to ADs and franchisees	24,208	18,617
Allowance for doubtful accounts for notes and accounts receivable	9,542	7,787
Non-impaired:
Allocation of allowance for doubtful accounts
Less amounts due to ADs and franchisees	(23,119)	(26,183)
Amounts receivable less amounts due to ADs and franchisees	53,587	57,850
Allowance for doubtful accounts for notes and accounts receivable	2,478	1,063
Accounts receivable
Allocation of allowance for doubtful accounts
Gross amount due	48,025	54,168
Accounts receivable | Impaired:
Allocation of allowance for doubtful accounts
Gross amount due	11,396	7,083
Accounts receivable | Non-impaired:
Allocation of allowance for doubtful accounts
Gross amount due	43,327	42,825
Notes and interest receivable, net of unrecognized revenue
Allocation of allowance for doubtful accounts
Gross amount due	54,723	49,908
Notes and interest receivable, net of unrecognized revenue | Impaired:
Allocation of allowance for doubtful accounts
Gross amount due	14,646	12,960
Notes and interest receivable, net of unrecognized revenue | Non-impaired:
Allocation of allowance for doubtful accounts
Gross amount due	$ 33,379	$ 41,208

XML

Accounts and Notes Receivable - Accounts and Notes Receivable Past Due (Details) - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016
Aging of accounts and notes receivable
Past due	$ 35,926	$ 30,854
Current	64,855	71,278
Financing Receivable, Recorded Investment, Current	1,967	1,944
Accounts and Notes Receivable Gross	102,748	104,076
Notes and interest receivable, net of unrecognized revenue
Aging of accounts and notes receivable
Past due	28,892	24,712
Current	25,831	25,196
Financing Receivable, Recorded Investment, Current	0	0
Accounts and Notes Receivable Gross	54,723	49,908
Accounts receivable
Aging of accounts and notes receivable
Past due	7,034	6,142
Current	39,024	46,082
Financing Receivable, Recorded Investment, Current	1,967	1,944
Accounts and Notes Receivable Gross	$ 48,025	$ 54,168

XML

Accounts and Notes Receivable - Narratives (Details) - USD ($) $ in Millions	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Trade Accounts Receivable Annual Finance Charges Percentage	12.00%
Developer rights term	6 years		10 years
Unrecognized Revenue	$ 29.4	$ 35.2
Impaired Financing Receivable, Average Recorded Investment	11.3	9.0	$ 7.9
Interest income related to impaired notes	1.2	0.9	$ 0.7
Investment in notes receivable on nonaccrual status	$ 7.0	$ 6.1
Franchise related notes
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes Receivable Due Period	5 years
Working capital and equipment notes
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes Receivable Due Period	1 year
Notes and interest receivable, net of unrecognized revenue
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due period	30 days
Accounts receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Past due period	90 days

XML

Property, Equipment, and Software, Net - Property, Equipment and Software (Details) - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016
Property, equipment, and software, net
Property, equipment, and software, gross	$ 65,761	$ 62,009
Less accumulated depreciation and amortization	25,972	21,052
Property, equipment, and software, net	39,789	40,957
Land and land improvements
Property, equipment, and software, net
Property, equipment, and software, gross	1,464	2,413
Buildings and building improvements
Property, equipment, and software, net
Property, equipment, and software, gross	7,964	8,733
Leasehold improvements
Property, equipment, and software, net
Property, equipment, and software, gross	132	138
Furniture, fixtures, and equipment
Property, equipment, and software, net
Property, equipment, and software, gross	5,788	6,307
Software
Property, equipment, and software, net
Property, equipment, and software, gross	$ 50,413	$ 44,418

XML

Property, Equipment, and Software, Net - Future Minimum Lease Payments (Details) $ in Thousands	Apr. 30, 2017 USD ($)
Property, Plant and Equipment [Abstract]
Operating Leases, Future Minimum Payments Due, Next Twelve Months	$ 9,518
Operating Leases, Future Minimum Payments, Due in Two Years	5,885
Operating Leases, Future Minimum Payments, Due in Three Years	3,455
Operating Leases, Future Minimum Payments, Due in Four Years	1,591
Operating Leases, Future Minimum Payments, Due in Five Years	670
Operating Leases, Future Minimum Payments, Due Thereafter	263
Operating Leases, Future Minimum Payments Due	21,382
Future Minimum Sublease Rentals, Sale Leaseback Transactions, Next Twelve Months	4,352
Future Minimum Sublease Rentals, Sale Leaseback Transactions, Due in Rolling after Year Five	2,733
Future Minimum Sublease Rentals, Sale Leaseback Transactions, within Three Years	1,785
Future Minimum Sublease Rentals, Sale Leaseback Transactions, within Four Years	726
Future Minimum Sublease Rentals, Sale Leaseback Transactions, within Five Years	344
Future Minimum Sublease Rentals, Sale Leaseback Transactions, Thereafter	150
Future Minimum Sublease Rentals, Sale Leaseback Transactions	$ 10,090

XML

Property, Equipment, and Software, Net - Narratives (Details) - USD ($) $ in Millions	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Property, Plant and Equipment [Abstract]
Total depreciation expense	$ 4.2	$ 4.7	$ 5.5
Assets not placed in service	$ 20.2	19.9
Operating Leases, Rent Expense, Net		$ 4.7	$ 3.2

XML

Investments - Narratives (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Equity Securities		$ 5,000
Available-for-sale Equity Securities, Gross Unrealized Loss	$ 0	500
Net Realized and Unrealized Gain (Loss) on Trading Securities	$ 50	$ 0	$ 0

XML

Goodwill and Intangible Assets - Changes in the Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Goodwill [Line Items]
Goodwill reclassified to assets held for sale, gross	$ 1,109	$ 0
Goodwill, balance at beginning of year	4,228	3,377
Acquisitions of assets from franchisees	3,649	960
Disposals and foreign currency changes, net	226	52
Impairments	(184)	(57)
Goodwill, balance at end of year	$ 8,576	$ 4,228

XML

Goodwill and Intangible Assets - Components of Amortizable Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Acquired Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 31,378	$ 23,136
Accumulated amortization	(10,154)	(6,866)
Net carrying amount	21,224	$ 16,270
Finite-Lived Intangible Assets, Net	$ 21,224
Acquired customer lists
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average amortization period	4 years	4 years
Gross carrying amount	$ 2,827	$ 1,027
Accumulated amortization	(899)	(339)
Net carrying amount	$ 1,928	$ 688
Customer lists
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average amortization period	4 years	4 years
Gross carrying amount	$ 1,189	$ 1,380
Accumulated amortization	(908)	(500)
Net carrying amount	$ 281	$ 880
Reacquired rights
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average amortization period	2 years	2 years
Gross carrying amount	$ 935	$ 511
Accumulated amortization	(919)	(482)
Net carrying amount	$ 16	$ 29
AD rights
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average amortization period	10 years	10 years
Gross carrying amount	$ 26,427	$ 20,218
Accumulated amortization	(7,428)	(5,545)
Net carrying amount	$ 18,999	$ 14,673

XML

Goodwill and Intangible Assets - Purchase Price of Assets Acquired from Franchisees (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Acquired Finite-Lived Intangible Assets [Line Items]
Purchase price of assets acquired from franchisees, not held for sale	$ 100
Goodwill and Intangible Assets Acquired	49	$ 1,815
Customer lists
Acquired Finite-Lived Intangible Assets [Line Items]
Purchase price of assets acquired from franchisees, not held for sale	13	728
Reacquired rights
Acquired Finite-Lived Intangible Assets [Line Items]
Purchase price of assets acquired from franchisees, not held for sale	11	39
Goodwill
Acquired Finite-Lived Intangible Assets [Line Items]
Purchase price of assets acquired from franchisees, not held for sale	$ 25	$ 1,048

XML

- Annual Amortization Expenses for the Next Five Years (Details) $ in Thousands	Apr. 30, 2017 USD ($)
Estimated amortization expense for next five years
2014	$ 3,664
2015	3,438
2016	3,109
2017	2,559
2018	2,269
Total estimated amortization expense	$ 15,039

XML

Goodwill and Intangible Assets - Narratives (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Apr. 30, 2017 USD ($)	Apr. 30, 2017 USD ($) office	Apr. 30, 2016 USD ($)	Apr. 30, 2015 USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]
Goodwill, Impairment Loss		$ 200	$ 100
Finite-lived Intangible Assets Acquired		100
Tangible Asset Impairment Charges		100	100	$ 500
Amortization of Intangible Assets		4,100	2,300	$ 3,600
Goodwill and Intangible Assets Acquired		$ 49	$ 1,815
Business Combination, Number Of Offices Acquired | office		6
Payments to Acquire Businesses, Gross	$ 2,300	$ 5,100
Business Combination, Contingent Consideration, Liability	$ 2,800	$ 2,800

XML

Goodwill and Intangible Assets Fair Value of Identifiable Assets (Details) $ in Thousands	12 Months Ended
	Apr. 30, 2017 USD ($)
Fair Value of Intangible Assets [Line Items]
Intangible Assets Acquired	$ 5,060
Accounts Receivable [Member]
Fair Value of Intangible Assets [Line Items]
Intangible Assets Acquired	261
Property, Plant and Equipment, Type [Domain]
Fair Value of Intangible Assets [Line Items]
Intangible Assets Acquired	55
Customer Lists
Fair Value of Intangible Assets [Line Items]
Intangible Assets Acquired	1,120
Goodwill
Fair Value of Intangible Assets [Line Items]
Intangible Assets Acquired	$ 3,624

XML

Assets Held for Sale - Amounts Reclassified From Various Categories (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Finite-Lived Intangible Assets [Line Items]
Assets held for sale transferred	$ 16,600	$ 13,309
Impairment charge on assets held for sale	5,663	2,057
Total assets held for sale	$ (11,989)	$ (9,886)	$ (5,160)

XML

Assets Held for Sale - Changes in Carrying Amounts of Assets Held For Sale (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Carrying Amounts of Assets HFS [Abstract]
Assets held for sale, beginning of period	$ 9,886	$ 5,160
Reaquired	16,600	13,309
Dispositions	(7,994)	(6,526)
Impairment	(5,663)	(2,057)
Assets held for sale, end of period	11,989	9,886
Assets Held for Sale, Transferred From	(2,428)	0
Assets Held For Sale, Transferred To	$ 1,588	$ 0

XML

Assets Held for Sale - Narratives (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Acquired Finite-Lived Intangible Assets [Line Items]
Payments to Acquire Businesses, Gross	$ 2,300	$ 5,100
Business Combination, Consideration Transferred, Liabilities Incurred		2,800
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables	$ 8,700	8,700
Assets Held for Sale, Transferred From		2,428	$ 0
Finite-lived Intangible Assets Acquired		100
Impairment charge on assets held for sale		5,663	2,057
Amortization of Intangible Assets		4,100	2,300	$ 3,600
Customer lists
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived Intangible Assets Acquired		13	728
Goodwill
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived Intangible Assets Acquired		25	1,048
UNITED STATES
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived Intangible Assets Acquired		16,600	13,300
UNITED STATES | Customer lists
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived Intangible Assets Acquired		8,300	6,100
UNITED STATES | Goodwill
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived Intangible Assets Acquired		8,300	$ 7,200
Customer lists
Acquired Finite-Lived Intangible Assets [Line Items]
Assets Held for Sale, Transferred From		700
Amortization of Intangible Assets		300
Reacquired Rights [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Assets Held for Sale, Transferred From		600
Amortization of Intangible Assets		500
Goodwill
Acquired Finite-Lived Intangible Assets [Line Items]
Assets Held for Sale, Transferred From		$ 1,100

XML

Debt - Debt (Details) - USD ($)	Apr. 30, 2017	Apr. 30, 2016
Credit facility
Total long-term Debt	$ 26,199,000	$ 23,440,000
Long-term Debt and Capital Lease Obligations, Current	7,738,000	5,947,000
Total long-term debt, less current installments	18,461,000	17,493,000
Revolving Credit Facility [Member]
Credit facility
Outstanding Borrowings	0
Term loan
Credit facility
Total long-term Debt	17,471,000	18,884,000
Notes payable to banks
Credit facility
Total long-term Debt	2,160,000	0
Mortgage Note Payable
Credit facility
Total long-term Debt	0	2,230,000
Notes payable, other payables
Credit facility
Total long-term Debt	6,568,000	2,317,000
Other debt instrument
Credit facility
Total long-term Debt	$ 0	$ 9,000

XML

Debt - Debt Phantoms (Details) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Term loan
Debt Instrument [Line Items]
Balloon payment	$ 13,016,000
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Outstanding Borrowings	0
Notes payable to banks
Debt Instrument [Line Items]
Balloon payment	$ 779,000	$ 2,213,000
Long Term Debt Monthly Installments	2.84%	6.06%
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate	0.00%
Term loan
Debt Instrument [Line Items]
Long Term Debt, Quarterly Principal Installments as Percentage of Original Amounts Borrowed for Next Twelve Months	2.50%
Long Term Debt, Quarterly Principal Installments as Percentage of Original Amounts Borrowed for Year Two	3.125%
Minimum
Debt Instrument [Line Items]
Note amount paid due date	May 31, 2017
Minimum | Notes payable to banks
Debt Instrument [Line Items]
Notes Payable	$ 10,000	$ 16,000
Maximum
Debt Instrument [Line Items]
Note amount paid due date	Apr. 30, 2020
Maximum | Notes payable to banks
Debt Instrument [Line Items]
Notes Payable	$ 14,000

XML

Debt - Aggregate Maturities of Long-term Debt (Details) - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016
Debt Disclosure [Abstract]
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year	$ 7,738
Long-term Debt, Maturities, Repayments of Principal in Year Two	16,510
Long-term Debt, Maturities, Repayments of Principal in Year Three	171
Long-term Debt, Maturities, Repayments of Principal in Year Four	136
Long-term Debt, Maturities, Repayments of Principal in Year Five	140
Long-term Debt, Maturities, Repayments of Principal after Year Five	1,504
Total long-term Debt	$ 26,199	$ 23,440

XML

Debt - Narrative (Details) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016
Debt Instrument [Line Items]
Unamortized Debt Issuance Expense	$ 100,000
Term loan
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	21,200,000
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	203,800,000
Line of credit facility, increased availability	50,000,000
Outstanding Borrowings	0
Line of Credit Facility, Remaining Borrowing Capacity	$ 108,000,000
Line of Credit [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Interest Rate at Period End	2.73%	2.06%
Maximum | Line of Credit [Member] | LIBOR
Debt Instrument [Line Items]
Debt Instrument, Basis Spread on Variable Rate	2.25%
Line of Credit Facility, Commitment Fee Percentage	0.50%
Weighted Average [Member] | Line of Credit [Member] | LIBOR
Debt Instrument [Line Items]
Debt Instrument, Basis Spread on Variable Rate	2.31%
Minimum | Line of Credit [Member] | LIBOR
Debt Instrument [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.50%
Line of Credit Facility, Commitment Fee Percentage	0.25%

XML

Derivative Instruments and Hedging Activities - Narratives (Details) - USD ($)	Apr. 30, 2017	Jan. 31, 2017	Apr. 30, 2016	Apr. 30, 2015
Derivative instruments and hedging activities
Interest Rate Derivatives, at Fair Value, Net	$ 100,000
Foreign Currency Contracts, Liability, Fair Value Disclosure	0		$ 0
Foreign currency adjustment	$ 0		$ 0	$ 0
Interest Rate Swap [Member]
Derivative instruments and hedging activities
Derivative, Notional Amount		$ 2,200,000
Interest Rate Swap [Member]
Derivative instruments and hedging activities
Long Term Debt, Monthly Installments Based on Percentage of Original Debt	4.12%

XML

Stockholders' Equity - Components of Accumulated Other Comprehensive Income (loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Foreign currency adjustment	$ (2,059)	$ (1,148)
Accumulated other comprehensive income, net of tax	2,084	1,698
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax	580	(550)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	30	0	$ 0
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax, Portion Attributable to Parent	(25)	0	$ 0
AOCI Attributable to Parent [Member]
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax	$ 30	$ (550)

XML

Stockholders' Equity - Computation of Basic and Diluted Net Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Apr. 30, 2017	Jan. 31, 2017	Oct. 31, 2016	Jul. 31, 2016	Apr. 30, 2016	Jan. 31, 2016	Oct. 31, 2015	Jul. 31, 2015	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Numerator:
Net income	$ 29,330	$ 2,455	$ (9,342)	$ (9,430)	$ 32,288	$ 4,738	$ (9,070)	$ (8,536)	$ 13,013	$ 19,420	$ 8,690
Undistributed Earnings Allocated to Participating Securities Class A Preferred Stock									(936)	(1,406)	(633)
Allocation of undistributed earnings for basic computation									$ 12,077	$ 18,014	$ 8,057
Earnings Per Share, Basic and Diluted	$ 2.11	$ 0.18	$ (0.72)	$ (0.73)	$ 2.33	$ 0.34	$ (0.71)	$ (0.67)	$ 0.94	$ 1.41	$ 0.63
Numerator:
Allocation of undistributed earnings for basic computation									$ 12,077	$ 18,014	$ 8,057
Weighted Average Number of Shares Outstanding, Basic	12,882,550	12,902,577	12,901,955	12,894,740	12,877,919	12,795,367	12,775,565	12,811,621	12,895,561	12,814,774	12,738,887
Denominator:
Weighted Average Number of Shares Outstanding, Diluted									13,916,908	14,024,671	14,294,773
Earnings Per Share, Diluted	$ 2.10	$ 0.18	$ (0.72)	$ (0.73)	$ 2.31	$ 0.34	$ (0.71)	$ (0.67)	$ 0.94	$ 1.38	$ 0.61
Class A common stock
Numerator:
Net income									$ 12,745	$ 18,056	$ 8,076
Undistributed Earnings Allocated to Participating Securities Class A Preferred Stock									(917)	(1,307)	(588)
Allocation of undistributed earnings for basic computation									$ 11,828	$ 16,749	$ 7,488
Earnings Per Share, Basic and Diluted									$ 0.94	$ 1.41	$ 0.63
Numerator:
Allocation of undistributed earnings for basic computation									$ 11,828	$ 16,749	$ 7,488
Reallocation of undistributed earnings as a result of assumed conversion of: Class B common stock to Class A common stock									249	1,265	569
Amount of Dilutive Securities Exchangeable Shares									936	1,406	633
Net Income (Loss) Available to Common Stockholders, Diluted									$ 13,013	$ 19,420	$ 8,690
Weighted Average Number of Shares Outstanding, Basic									12,630,356	11,914,775	11,838,887
Denominator:
Weighted-average effect of dilutive securities add the conversion of exercise of: Class B common stock to Class A common stock (in shares)									265,205	900,000	900,000
Weighted-average effect of dilutive securities add the conversion of exercise of: exchangeable shares to Class A common stock (in shares)									1,000,000	1,000,000	1,000,000
Weighted-average effect of dilutive securities add the conversion of exercise of employee stock options (in shares)									21,347	209,896	555,886
Weighted Average Number of Shares Outstanding, Diluted									13,916,908	14,024,671	14,294,773
Earnings Per Share, Diluted									$ 0.94	$ 1.38	$ 0.61
Class B common stock
Numerator:
Net income									$ 268	$ 1,364	$ 614
Undistributed Earnings Allocated to Participating Securities Class A Preferred Stock									(19)	(99)	(45)
Allocation of undistributed earnings for basic computation									$ 249	$ 1,265	$ 569
Earnings Per Share, Basic and Diluted									$ 0.94	$ 1.41	$ 0.63
Numerator:
Allocation of undistributed earnings for basic computation									$ 249	$ 1,265	$ 569
Reallocation of undistributed earnings as a result of assumed conversion of: Class B common stock to Class A common stock									0	0	0
Amount of Dilutive Securities Exchangeable Shares									0	0	0
Net Income (Loss) Available to Common Stockholders, Diluted									$ 249	$ 1,265	$ 569
Weighted Average Number of Shares Outstanding, Basic									265,205	900,000	900,000
Denominator:
Weighted-average effect of dilutive securities add the conversion of exercise of: Class B common stock to Class A common stock (in shares)									0	0	0
Weighted-average effect of dilutive securities add the conversion of exercise of: exchangeable shares to Class A common stock (in shares)									0	0	0
Weighted-average effect of dilutive securities add the conversion of exercise of employee stock options (in shares)									407	13,674	36,415
Weighted Average Number of Shares Outstanding, Diluted									265,612	913,674	936,415
Earnings Per Share, Diluted									$ 0.94	$ 1.38	$ 0.61

XML

Stockholders' Equity - Narratives (Details)	12 Months Ended
	Apr. 30, 2017 Director $ / shares shares	Apr. 30, 2016 $ / shares shares	Apr. 30, 2015 shares
Common stock
Number of directors entitled to be elected more than the number of directors elected by holders of all other classes of stock combined | Director	1
Impact of shares of common stock from the exercise of options excluded from computation of diluted net income per share because the effect would be antidilutive	1,320,162	429,644	210,416
Class A common stock
Preferred stock and exchangeable shares
Common stock, shares issued	12,682,550	11,993,292
Common stock
Authorized shares	21,200,000	21,200,000
Par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Class B common stock
Preferred stock and exchangeable shares
Common stock, shares issued	200,000	900,000
Common stock
Authorized shares	1,000,000	1,000,000
Par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Class A preferred stock
Preferred stock and exchangeable shares
Shares authorized	190,000	190,000
Par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Special voting preferred stock
Preferred stock and exchangeable shares
Shares authorized	10	10
Par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Common Stock Number of Shares Represented as Voting for Each Preferred Share	100,000
Exchangeable shares
Preferred stock and exchangeable shares
Common stock, shares issued	1,000,000	1,000,000
Common stock
Par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01

XML

Stock Compensation Plan (Details) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015	Aug. 31, 2011
Nonvested stock option activity, Nonvested options
Canceled (in shares)	0	(50,000)	0
Nonvested stock option activity, Weighted average exercise price
Canceled (in dollars per share)	$ 0.00	$ 33.79	$ 0.00
Total intrinsic value of options exercised	$ 0	$ 900,000	$ 13,300,000
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Volatility Calculated by Company Public Trading History	7500.00%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Volatility Calculated by Competitor Public Trading History	2500.00%
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value	$ 735,080
Minimum
Stock compensation plan
Vesting period	6 months
Exercise period after the vesting date	4 years
Maximum
Stock compensation plan
Vesting period	6 years
Exercise period after the vesting date	5 years
Nonvested Stock Option [Member]
Nonvested stock option activity, Weighted average exercise price
Unrecognized compensation costs	$ 2,000,000
Stock Option Plan [Member]
Stock option activity, Number of options
Outstanding at the start of the period (in shares)	1,264,562	1,343,559	1,940,406
Granted (in shares)	512,119	227,387	170,416
Exercised (in shares)	0	(154,594)	(761,913)
Canceled (in shares)	(389,350)	(151,790)	(5,350)
Outstanding at the end of the period (in shares)	1,387,331	1,264,562	1,343,559
Stock option activity, Weighted average exercise price
Outstanding at the beginning of the period (in dollars per share)	$ 19,770.00	$ 19.28	$ 16.68
Granted (in dollars per share)	12,610.00	22,300.00	32.87
Exercised (in dollars per share)	0.00	14,790.00	15.73
Canceled (in dollars per share)	16,590.00	24,310.00	15.00
Outstanding at the end of the period (in dollars per share)	$ 18,020.00	$ 19,770.00	$ 19.28
Stock Option
Information for options granted
Expected volatility, minimum (as a percent)	32.80%	32.40%	31.10%
Expected volatility, maximum (as a percent)	35.40%	35.60%	31.70%
Risk-free interest rates, minimum (as a percent)	1.20%	1.40%	1.60%
Risk-free interest rates, maximum (as a percent)	2.10%	1.70%	1.90%
Stock option activity, Number of options
Outstanding at the end of the period (in shares)	1,387,331
Nonvested stock option activity, Nonvested options
Outstanding at the beginning of the period (in shares)	389,053	385,416	485,000
Granted (in shares)	512,119	227,387	170,416
Vested (in shares)	(223,054)	(173,750)	(270,000)
Outstanding at the end of the period (in shares)	678,118	389,053	385,416
Nonvested stock option activity, Weighted average exercise price
Outstanding at the beginning of the period (in dollars per share)	$ 24.76	$ 27.56	$ 20.92
Granted (in dollars per share)	12,610.00	22.30	32.87
Vested (in dollars per share)	23,880.00	25.16	18.99
Outstanding at the end of the period (in dollars per share)	$ 15,880.00	$ 24.76	$ 27.56
Stock Option | Minimum
Information for options granted
Dividend yield (as a percent)	5.00%	2.80%	0.00%
Expected terms	5 years	4 years	5 years
Stock Option | Maximum
Information for options granted
Dividend yield (as a percent)	6.10%	3.70%	2.20%
Expected terms	6 years	6 years	5 years
Restricted Stock Units
Nonvested stock option activity, Weighted average exercise price
Unrecognized compensation costs	$ 2,000,000
Equity Plan 2011 [Member]
Stock compensation plan
Class A common stock authorized for grant under the Plan (in shares)				2,500,000
Class A common stock available for grant (in shares)	1,082,412

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Stock Compensation Plan (Details 2)	12 Months Ended
	Apr. 30, 2017 USD ($) $ / shares shares
Stock options outstanding and exercisable
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $	$ 735,080
Minimum
Stock options outstanding and exercisable
Vesting period	6 months
Share Based Compensation Arrangement by Share Based Payment Award Exercise Period	4 years
Maximum
Stock options outstanding and exercisable
Vesting period	6 years
Share Based Compensation Arrangement by Share Based Payment Award Exercise Period	5 years
Stock Option
Stock options outstanding and exercisable
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | shares	1,387,331
Weighted average exercise price (in dollars per share)	$ 18.02
Number of options exercisable | shares	709,213
Weighted average exercise price (in dollars per share)	$ 20.07
Range of exercise prices - $15.00 | Stock Option
Stock options outstanding and exercisable
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | shares	706,712
Exercise price, low end of range (in dollars per share)	$ 10.51
Exercise price, high end of range (in dollars per share)	15
Weighted average exercise price (in dollars per share)	$ 13.27
Weighted average remaining contractual life (in years)	4 years 8 months
Number of options exercisable | shares	194,593
Weighted average exercise price (in dollars per share)	$ 15.00
Range of exercise prices - $16.38 - $19.75 | Stock Option
Stock options outstanding and exercisable
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | shares	284,816
Exercise price, low end of range (in dollars per share)	$ 16.38
Exercise price, high end of range (in dollars per share)	19.75
Weighted average exercise price (in dollars per share)	$ 17.93
Weighted average remaining contractual life (in years)	3 years
Number of options exercisable | shares	266,816
Weighted average exercise price (in dollars per share)	$ 17.96
Exercise Price, Range Three [Member] | Stock Option
Stock options outstanding and exercisable
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | shares	330,387
Exercise price, low end of range (in dollars per share)	$ 22.18
Exercise price, high end of range (in dollars per share)	29.48
Weighted average exercise price (in dollars per share)	$ 25.22
Weighted average remaining contractual life (in years)	4 years 6 months
Number of options exercisable | shares	212,387
Weighted average exercise price (in dollars per share)	$ 25.15
Exercise Price, Range Four [Member] | Stock Option
Stock options outstanding and exercisable
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | shares	65,416
Exercise price, low end of range (in dollars per share)	$ 33.38
Exercise price, high end of range (in dollars per share)	33.38
Weighted average exercise price (in dollars per share)	$ 33.38
Weighted average remaining contractual life (in years)	4 years 6 months
Number of options exercisable | shares	35,417
Weighted average exercise price (in dollars per share)	$ 33.38

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Stock Compensation Plan Restricted Stock (Details) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015	Apr. 30, 2014
Stock compensation plan
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value	$ 735,080
Restricted Stock Units
Stock compensation plan
Share Based Compensation Arrangement by Share Based Payment Award Options Nonvested Granted in Period Weighted Average Exercise Price	$ 12.62	$ 23.06	$ 33.38
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number	176,396,000	42,792,000	28,929,000	21,445,000
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Weighted Average Grant Date Fair Value	$ 13.61	$ 26.10	$ 30.63	$ 16.87
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted	165,454,000	32,056,000	25,691,000
Share Based Compensation Arrangement by Share Based Payment Award Options Vested in Period	(17,118,000)	(13,394,000)	(14,746,000)
Share Based Compensation Arrangement by Share Based Payment Award Options Nonvested Forfeited in Period	(14,732,000)	(4,799,000)	(3,461,000)
Share Based Compensation Arrangement by Share Based Payment Award Options Vested in Period Weighted Average Exercise Price	$ 24.58	$ 27.99	$ 16.38
Share Based Compensation Arrangement by Share Based Payment Award Options Nonvested Forfeited in Period Weighted Average Exercise Price	$ 25.94	$ 27.89	$ 26.47

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Fair Value of Financial Instruments (Details) - USD ($)	Apr. 30, 2017	Apr. 30, 2016
Assets:
Assets, Fair Value Disclosure	$ 38,994,000	$ 33,530,000
Interest rate swap agreement	0	0
Fair Value, Inputs, Level 1 [Member]
Assets:
Assets, Fair Value Disclosure	10,393,000	11,263,000
Fair Value, Inputs, Level 2 [Member]
Assets:
Assets, Fair Value Disclosure	0	0
Fair Value, Inputs, Level 3 [Member]
Assets:
Assets, Fair Value Disclosure	28,601,000	22,267,000
Fair Value, Measurements, Recurring [Member]
Assets:
Cash equivalents	10,393,000	7,140,000
Available For Sale Securities, Fair Value Disclosure		4,123,000
Assets, Fair Value Disclosure, Recurring	(10,393,000)	(11,263,000)
Contingent consideration included in obligations due former ADs, franchisees and others	3,215,000
Total recurring liabilities	3,215,000
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Assets:
Cash equivalents	10,393,000	7,140,000
Available For Sale Securities, Fair Value Disclosure		4,123,000
Assets, Fair Value Disclosure, Recurring	(10,393,000)	(11,263,000)
Contingent consideration included in obligations due former ADs, franchisees and others	0
Total recurring liabilities	0
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Assets:
Cash equivalents	0	0
Available For Sale Securities, Fair Value Disclosure		0
Assets, Fair Value Disclosure, Recurring	0	0
Contingent consideration included in obligations due former ADs, franchisees and others	0
Total recurring liabilities	0
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Assets:
Cash equivalents	0	0
Available For Sale Securities, Fair Value Disclosure		0
Assets, Fair Value Disclosure, Recurring	0	0
Contingent consideration included in obligations due former ADs, franchisees and others	3,215,000
Total recurring liabilities	3,215,000
Fair Value, Measurements, Nonrecurring [Member]
Assets:
Impaired accounts and notes receivable, net of unearned revenue	16,500,000	12,256,000
Impaired goodwill	94,000	63,000
Impaired reacquired rights		28,000
Impaired customer lists	18,000	34,000
Assets Held for Sale, net of impairment	11,989,000	9,886,000
Assets, Fair Value Disclosure, Nonrecurring	28,601,000	22,267,000
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member]
Assets:
Impaired accounts and notes receivable, net of unearned revenue	0	0
Impaired goodwill	0	0
Impaired reacquired rights		0
Impaired customer lists	0	0
Assets Held for Sale, net of impairment	0	0
Assets, Fair Value Disclosure, Nonrecurring	0	0
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member]
Assets:
Impaired accounts and notes receivable, net of unearned revenue	0	0
Impaired goodwill	0	0
Impaired reacquired rights		0
Impaired customer lists	0	0
Assets Held for Sale, net of impairment	0	0
Assets, Fair Value Disclosure, Nonrecurring	0	0
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member]
Assets:
Impaired accounts and notes receivable, net of unearned revenue	16,500,000	12,256,000
Impaired goodwill	94,000	63,000
Impaired reacquired rights		28,000
Impaired customer lists	18,000	34,000
Assets Held for Sale, net of impairment	11,989,000	9,886,000
Assets, Fair Value Disclosure, Nonrecurring	$ 28,601,000	$ 22,267,000

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Fair Value of Financial Instruments Activity in Level 3 FV Measurements (Details) - Nonrecurring assets: - USD ($) $ in Thousands	Apr. 30, 2017	Apr. 30, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired accounts and notes receivable, net of unearned revenue	$ 16,500	$ 12,256
Impaired reacquired rights		28
Impaired customer lists	18	34
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired accounts and notes receivable, net of unearned revenue	16,500	12,256
Impaired reacquired rights		28
Impaired customer lists	$ 18	$ 34

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Employee 401(k) Plan (Details) $ in Millions	12 Months Ended
	Apr. 30, 2017 USD ($)
Defined Benefit Plan Disclosure [Line Items]
Requisite age of the employees eligible to make voluntary contributions to the plan	18 years
Requisite completion period of service of employees eligible to make voluntary contributions to the plan	90 days
Matching contribution as a percentage of each employee's contribution	50.00%
Maximum percentage of the employee's salary up to which the employer matches its contribution	3.00%
Deferred Compensation Arrangement with Individual, Compensation Expense	$ 0.5

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Income Taxes (Details) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Finite-Lived Intangible Assets [Line Items]
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense	$ 100,000
Deferred Tax Assets, Operating Loss Carryforwards, Domestic	148,000	$ 0
Total income tax expense	7,754,000	11,058,000	$ 4,811,000
Tax expense (benefit) of stock option exercises	378,000	(900,000)	(4,803,000)
Available-for-sale Securities, Change in Net Unrealized Holding Gain (Loss) before Taxes	0	326,000	0
Total income taxes	8,132,000	9,832,000	8,000
Current:
Federal	6,125,000	2,748,000	5,973,000
State	1,160,000	598,000	2,157,000
Foreign	293,000	328,000	226,000
Current tax expense	7,578,000	3,674,000	8,356,000
Deferred:
Federal	315,000	6,079,000	(2,629,000)
Deferred State and Local Income Tax Expense (Benefit)	(183,000)	1,322,000	(950,000)
State	100,000
Foreign	44,000	(17,000)	34,000
Deferred tax expense (benefit)	176,000	7,384,000	(3,545,000)
Income tax expense
Total income tax expense	7,754,000	11,058,000	4,811,000
Income before taxes
U.S. operations	19,558,000	28,954,000	12,459,000
Foreign operations	1,209,000	1,524,000	1,042,000
Income before income taxes	$ 20,767,000	30,478,000	13,501,000
Reconciliation of amounts computed by applying the U.S. federal income tax rate to pretax income from continuing operations
U.S. federal income tax rate (as a percent )	35.00%
Computed expected income tax expense	$ 7,269,000	10,667,000	4,725,000
Increase (decrease) in income taxes resulting from:
State income taxes, net of federal benefit	634,000	1,126,000	1,034,000
Nondeductible expenses	211,000	246,000	308,000
Tax credits	(140,000)	(370,000)	(251,000)
Effective Income Tax Rate Reconciliation, Non Taxable Income	158,000	538,000	466,000
Effective Income Tax Rate Reconciliation, Non Taxable Expenses	58,000	31,000	(378,000)
Effective Income Tax Rate Reconciliation, Foreign Tax Rate Differential, Am	(86,000)	(222,000)	(104,000)
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount	(64,000)	0	18,000
Other	30,000	118,000	(75,000)
Total income tax expense	7,754,000	11,058,000	4,811,000
Deferred tax assets:
Deferred revenue	2,260,000	2,292,000
Goodwill, intangible assets, and assets held for sale	5,136,000	3,707,000
DeferredTaxAssetsTaxDeferredExpenseReservesandAccrualsGoodwill,IntangibleAssetsandAssetsHeldforSale	3,140,000	0
Unexercised nonqualified stock options	11,286,000	1,236,000
deferred tax assets, accounts payable and accrued expense	1,954,000	594,000
Total deferred tax assets	23,924,000	7,829,000
Deferred tax liabilities:
Property, equipment and software	12,916,000	10,285,000
Total deferred tax liabilities	27,335,000	10,655,000
Net deferred tax liability	(3,411,000)	(2,826,000)
DeferredLiabilityTaxAdjustment	11,729,000	0
Intangible assets	2,048,000	0
Deferred Tax Liabilities, Deferred Contingencies	137,000	0
Other Current Assets, Tax Related	505,000	370,000
Unrecognized tax benefits	0
Foreign subsidiary net earnings permanently reinvested	$ 1,200,000	$ 1,500,000	$ 1,000,000

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Related Party Transactions (Details) - USD ($)	12 Months Ended
	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Related party transactions
Finite-lived Intangible Assets Acquired	$ 100,000
Amount	$ 420,000	$ 1,977,000	$ 36,308,000
Directors and their affiliated companies, and officers | Common stock:
Related party transactions
Shares repurchased	30,000	0	1,007
Amount	$ 378,000	$ 0	$ 26,954
License Purchase [Domain] [Domain] | CANADA | Directors and their affiliated companies, and officers
Related party transactions
Finite-lived Intangible Assets Acquired	$ 900,000		$ 700,000
Finite-lived Intangible Assets Acquired, Contract Term	3 years

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Commitments and Contingencies (Details) - JTH Tax, Inc. and SiempreTax LLC v. Gregory Aime, Aime Consulting, LLC, Aime Consulting, Inc. and Wolf Ventures, Inc. (Case No. 2:16-cv-279) [Member] $ in Millions	Feb. 15, 2017 USD ($)	Jan. 13, 2017	Sep. 09, 2016 USD ($)	Jun. 09, 2016
Commitments and contingencies
Number of times, defendants' earnings and profits				3
Damages sought			$ 2.4
Bench trial period		3 days
Judgment amount	$ 2.7
Judgment reserve	$ 2.7

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Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Apr. 30, 2017	Jan. 31, 2017	Oct. 31, 2016	Jul. 31, 2016	Apr. 30, 2016	Jan. 31, 2016	Oct. 31, 2015	Jul. 31, 2015	Apr. 30, 2017	Apr. 30, 2016	Apr. 30, 2015
Quarterly Financial Data [Abstract]
Revenue	$ 111,179	$ 48,423	$ 7,234	$ 7,149	$ 104,414	$ 53,621	$ 7,871	$ 7,523	$ 173,985	$ 173,429	$ 162,172
Net income (loss)	$ 29,330	$ 2,455	$ (9,342)	$ (9,430)	$ 32,288	$ 4,738	$ (9,070)	$ (8,536)	$ 13,013	$ 19,420	$ 8,690
Weighted Average Number of Shares Outstanding, Basic	12,882,550	12,902,577	12,901,955	12,894,740	12,877,919	12,795,367	12,775,565	12,811,621	12,895,561	12,814,774	12,738,887
Pro Forma Weighted Average Shares Outstanding, Diluted	13,934,941	13,924,210	12,901,955	12,894,740	13,967,568	14,002,356	12,775,565	12,811,621
Net Income (Loss) per share of Class A and Class B common stock:
Basic (in dollars per share)	$ (2.11)	$ (0.18)	$ 0.72	$ 0.73	$ (2.33)	$ (0.34)	$ 0.71	$ 0.67	$ (0.94)	$ (1.41)	$ (0.63)
Diluted (in dollars per share)	2.10	0.18	(0.72)	(0.73)	2.31	0.34	(0.71)	(0.67)	0.94	1.38	0.61
Common Stock, Dividends, Per Share, Declared	$ 0.16	$ 0.16	$ 0.16	$ 0.16	$ 0.16	$ 0.16	$ 0.16	$ 0.16	$ 640.00	$ 640.00	$ 160.00

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Subsequent Events (Details) - USD ($)		12 Months Ended
	Jul. 28, 2017	Apr. 30, 2017	Apr. 30, 2016
Subsequent events
Cash dividend per share		$ 0.64	$ 0.64
Subsequent Event
Subsequent events
Cash dividend per share	$ 0.16