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INCOME TAXES
 12 Months Ended
Apr. 02, 2022
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Domestic and foreign income (loss) before (benefit) provision for income tax is as follows:
(In thousands)202220212020
Domestic$(5,219)$5,526 $5,344 
Foreign68,848 67,387 81,808 
Total$63,629 $72,913 $87,152 

The income tax (benefit) provision from continuing operations contains the following components:
(In thousands)202220212020
Current   
Federal$3,586 $(289)$3,834 
State1,682 1,256 1,054 
Foreign9,940 13,319 12,467 
Total current$15,208 $14,286 $17,355 
Deferred   
Federal3,455 (12,906)(8,257)
State310 (2,436)280 
Foreign1,281 (5,500)1,248 
Total deferred$5,046 $(20,842)$(6,729)
Total$20,254 $(6,556)$10,626 

The Company conducts business globally and reports its results of operations in a number of foreign jurisdictions in addition to the United States. The Company's reported tax rate is impacted by the jurisdictional mix of earnings in any given period as the foreign jurisdictions in which it operates have tax rates that differ from the U.S. statutory tax rate.
The Company's subsidiary in Malaysia has been granted a full income tax exemption to manufacture whole blood and apheresis devices that could be in effect for up to ten years, provided certain conditions are satisfied. The income tax exemption was in effect beginning June 1, 2016.

Tax effected, significant temporary differences comprising the net deferred tax liability are as follows:
(In thousands)April 2,
2022		April 3,
2021
Deferred tax assets:
Depreciation$623 $1,054 
Amortization of intangibles1,243 1,167 
Inventory6,841 5,166 
Accruals, reserves and other deferred tax assets13,020 17,274 
Net operating loss carry-forward30,212 38,827 
Stock based compensation4,422 4,374 
Operating lease liabilities15,777 16,941 
Tax credit carry-forward, net6,452 5,073 
Capitalized research expenses6,733 4,291 
Gross deferred tax assets85,323 94,167 
Less valuation allowance(14,077)(11,081)
Total deferred tax assets (after valuation allowance)71,246 83,086 
Deferred tax liabilities:
Depreciation(15,727)(10,470)
Amortization of goodwill and intangibles(63,004)(68,802)
Unremitted earnings(1,254)(1,060)
Operating lease assets(12,877)(14,722)
Debt discount— (19,868)
Other deferred tax liabilities(2,643)(5,980)
Total deferred tax liabilities(95,505)(120,902)
Net deferred tax liabilities$(24,259)$(37,816)

The decrease in the worldwide net deferred tax liability is primarily due to the adoption of ASU 2020-06, for which the reduction in the deferred tax liability related to convertible debt was recorded through equity. Other changes in the worldwide net deferred tax liability were the result of current year operating results.

The valuation allowance increase of $3.0 million during fiscal 2022 is primarily due to additional valuation allowances recorded on US state net operating loss and tax credit carryforwards. The Company has assessed, on a jurisdictional basis, the available means of recovering deferred tax assets, including the ability to carry-back net operating losses, the existence of reversing temporary differences, the availability of tax planning strategies and available sources of future taxable income. It has also considered the ability to implement certain strategies that would, if necessary, be implemented to accelerate taxable income and use expiring deferred tax assets. The Company has concluded future taxable income can be considered a source of income to realize a benefit for deferred tax assets in certain jurisdictions. In addition, the Company has concluded that it cannot rely on future taxable income in certain risk bearing principal jurisdictions due to uncertainty surrounding future taxable income including the effects of Covid-19, the announcement of CSL intent not to renew its supply agreement and the general uncertainty surrounding the global economy. The Company believes it is able to support the deferred tax assets recognized as of the end of the year based on all of the available evidence. The worldwide net deferred tax liability as of April 2, 2022 includes deferred tax liabilities related to amortizable tax basis in goodwill and other indefinite lived assets, which can only be used as a source of income to benefit other indefinite lived assets.

As of April 2, 2022, the Company maintains a valuation allowance against certain U.S. state deferred tax assets that are not more-likely-than-not realizable and maintains a full valuation allowance against the net deferred tax assets of certain foreign subsidiaries.
In connection with the March 2021 acquisition of Cardiva, the Company acquired federal and state net operating loss carryforwards of $150.9 million and $93.3 million, respectively. The Company also acquired federal and state tax research credit carryforwards of $0.2 million and $0.4 million, respectively. These net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50 percent as defined under Section 382 and 383 of the U.S. Internal Revenue Code of 1986, respectively, as well as similar state provisions. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. The Company conducted a Section 382 study covering the period of inception (July 2002) through March 1, 2021. The study concluded that ownership changes occurred during that period which limit the amount of the Company’s net operating losses and tax credit carryforwards that can be utilized before expiring. The carryforwards disclosed represent the amount of attributes that can be utilized based on the results of the study.

As of April 2, 2022, the Company has U.S. federal net operating loss carryforwards of $99.2 million of which $8.2 million will begin to expire in fiscal 2024 and $91.0 million can be carried forward indefinitely. The Company has U.S. state net operating losses of $107.2 million of which $85.7 million will begin to expire in fiscal 2023 and $21.5 million can be carried forward indefinitely. The Company has federal and state tax credits of $1.3 million and $6.2 million, respectively, which will begin to expire in fiscal 2029 and fiscal 2025, respectively.

As of April 2, 2022, the Company has foreign net operating losses of approximately $12.1 million that are available to reduce future income of which $6.9 million will begin to expire in fiscal 2034 and $5.2 million can be carried forward indefinitely.

As of April 2, 2022, substantially all of the unremitted earnings of the Company have been taxed in the U.S. The Company has provided $1.3 million of U.S. income and foreign withholding taxes on approximately $150.5 million of unremitted earnings that are not indefinitely reinvested. The Company has not provided U.S. deferred income taxes or foreign withholding taxes on unremitted earnings of foreign subsidiaries of approximately $125.2 million as such amounts are considered to be indefinitely reinvested in the business. The accumulated earnings in the foreign subsidiaries are primarily utilized to fund working capital requirements as its subsidiaries continue to expand their operations, to service existing debt obligations and to fund future foreign acquisitions. The Company does not believe it is practicable to estimate the amount of income taxes payable on the earnings that are indefinitely reinvested in foreign operations, however a significant portion of the unremitted earnings could be remitted without a future tax cost.

The income tax (benefit) provision from continuing operations differs from the tax provision (benefit) computed at the U.S. federal statutory income tax rate due to the following:
(In thousands)202220212020
Tax at federal statutory rate$13,362 21.0 %$15,312 21.0 %$18,302 21.0 %
Difference between U.S. and foreign tax(3,799)(6.0)%(7,049)(9.7)%(6,688)(7.7)%
State income taxes net of federal benefit1,384 2.2 %(924)(1.3)%(342)(0.4)%
Change in uncertain tax positions(777)(1.2)%1,172 1.6 %785 0.9 %
Global intangible low taxed income3,608 5.7 %(758)(1.0)%5,431 6.2 %
Unremitted earnings194 0.3 %257 0.4 %40 — %
Deferred statutory rate changes40 0.1 %(243)(0.3)%1,091 1.3 %
Non-deductible executive compensation1,080 1.7 %2,238 3.1 %2,423 2.8 %
Non-deductible expenses741 1.2 %2,038 2.8 %1,050 1.2 %
Stock compensation benefits2,070 3.3 %(5,504)(7.5)%(12,133)(13.9)%
Research credits(1,496)(2.4)%(1,230)(1.7)%(2,085)(2.4)%
Contingent consideration1,880 3.0 %— — %— — %
Intercompany sale of intellectual property— — %(7,550)(10.4)%— — %
Valuation allowance254 0.2 %(3,144)(4.4)%2,939 3.4 %
Other, net1,713 2.7 %(1,171)(1.6)%(187)(0.2)%
Income tax (benefit) provision$20,254 31.8 %$(6,556)(9.0)%$10,626 12.2 %

The Company recorded an income tax expense of $20.3 million, representing an effective tax rate of 31.8%. The effective tax rate is higher than the U.S. statutory rate of 21.0%, primarily due to the impact of GILTI, non-deductible executive
compensation, contingent consideration from the Cardiva acquisition, and state taxes partially offset by the jurisdictional mix of earnings, research credits generated, and reductions to uncertain tax positions. The Company has recorded an immaterial tax expense related to unremitted foreign earnings that are not considered permanently reinvested.

Unrecognized Tax Benefits

Unrecognized tax benefits represent uncertain tax positions for which reserves have been established. As of April 2, 2022, the Company had $3.9 million of unrecognized tax benefits, of which $3.1 million would impact the effective tax rate, if recognized. As of April 3, 2021, the Company had $6.1 million of unrecognized tax benefits, of which $5.3 million would impact the effective tax rate, if recognized. At March 28, 2020, the Company had $4.6 million of unrecognized tax benefits, of which $4.0 million would impact the effective tax rate, if recognized.

The following table summarizes the activity related to its gross unrecognized tax benefits for the fiscal years ended April 2, 2022, April 3, 2021 and March 28, 2020:
(In thousands)April 2,
2022		April 3,
2021		March 28,
2020
Beginning Balance$6,107 $4,620 $4,657 
Additions for tax positions of current year219 335 180 
Additions for tax positions of prior years— 1,194 880 
Reductions of tax positions(808)(42)(539)
Settlements of tax positions(1,579)— (558)
Closure of statute of limitations— — — 
Ending Balance$3,939 $6,107 $4,620 

As of April 2, 2022, the Company anticipates that the liability for unrecognized tax benefits for uncertain tax positions could change by up to $0.2 million in the next twelve months, as a result of closure of various statutes of limitations.

The Company's historical practice has been and continues to be to recognize interest and penalties related to federal, state and foreign income tax matters in income tax expense. Approximately $0.1 million and $1.4 million of gross interest and penalties were accrued at April 2, 2022 and April 3, 2021, respectively, and are not included in the amounts above. Additionally, $0.1 million, $0.9 million and $0.3 million of accrued interest and penalties was included in income tax provision (benefit) for the years ended April 2, 2022, April 3, 2021and March 28, 2020, respectively.

The Company conducts business globally and, as a result, files federal, state and foreign income tax returns in multiple jurisdictions. In the normal course of business, it is subject to examination by taxing authorities throughout the world. With a few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for years before fiscal 2018 and foreign income tax examinations for years before fiscal 2017. To the extent that the Company has tax attribute carry-forwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service, state, or foreign tax authorities to the extent utilized in a future period.