Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Pre-tax earnings by significant geographical locations

Pre-tax earnings by significant geographical locations are as follows (in thousands):



	Year Ended December 31,
	2015		2014		2013
United States	$	146,940	$	113,967	$	118,269
Foreign	158,506		135,562		110,717
	$	305,446	$	249,529	$	228,986

Provisions for income taxes

The provisions for income taxes are as follows (in thousands):



	Year Ended December 31,
	2015			2014			2013
Current tax expense:
Federal	$	35,029		$	30,224		$	38,249
State	6,074			5,511			4,413
Foreign	19,884			11,389			13,483
	60,987			47,124			56,145
Deferred tax expense (benefit):
Federal	10,752			1,207			(252		)
State	1,052			(1,115		)	(335		)
Foreign	(9,031		)	2,052			(3,587		)
	2,773			2,144			(4,174		)
Total income tax provision	$	63,760		$	49,268		$	51,971

Deferred tax assets (liabilities)

Net deferred tax assets (liabilities) were classified on the balance sheet as follows (in thousands):



	December 31,
	2015			2014 (As reclassified)
Deferred tax assets, non-current	55,429			54,102
Deferred tax liabilities, non-current	(3,623		)	(9,193		)
Net deferred tax assets	$	51,806		$	44,909
Valuation allowance	$	2,607		$	13,277


Note 14.	Income Taxes—(Continued)

The tax effects of temporary differences that gave rise to significant portions of deferred tax assets and deferred tax liabilities were as follows (in thousands):



	December 31,
	2015			2014
Deferred tax assets:
Accrued liabilities and allowances	$	27,170		$	34,389
Tax credit and loss carry-forwards	29,297			25,858
Stock-based compensation	15,628			19,530
Inventory basis differences	10,494			10,565
Deferred revenue	6,184			4,608
Other assets	1,373			4,334
Gross deferred tax assets	90,146			99,284
Valuation allowance	(2,607		)	(13,277		)
Total deferred tax assets, net	87,539			86,007
Deferred tax liabilities:
Intangible assets	(26,996		)	(34,737		)
Property and equipment	(6,612		)	(4,553		)
Other liabilities	(2,125		)	(1,808		)
Total deferred tax liabilities	(35,733		)	(41,098		)
Net deferred tax assets	$	51,806		$	44,909

Effective income tax rate reconciliation

The provision for income taxes differs from the amount of tax determined by applying the applicable United States statutory federal income tax rate to pretax income as a result of the following differences:



	Year Ended December 31,
	2015		2014		2013
Statutory federal tax rate	35.0	%	35.0	%	35.0	%
Increase (decrease) in rates resulting from:
Foreign rate differential	(7.8	)	(12.7	)	(11.6	)
Foreign, federal and state income tax credits	(2.1	)	(1.7	)	(2.2	)
State taxes	2.4		2.1		1.0
Non-deductible expenses	—		—		1.1
Valuation allowance release	(6.4	)	(0.1	)	—
Other	(0.2	)	(2.9	)	(0.6	)
Effective tax rate	20.9	%	19.7	%	22.7	%

The following table summarizes the activity related to unrecognized tax benefits, including amounts accrued for potential interest and penalties (in thousands):



	Year Ended December 31,
	2015			2014			2013
Balance, beginning of year	$	15,401		$	29,533		$	35,143
Increases related to current year tax positions	1,446			1,457			979
Increases related to prior year tax positions	299			12			714
Decreases related to prior year tax positions	(724		)	(781		)	(2,736		)
Lapse of statute of limitations	(1,455		)	(5,165		)	(2,012		)
Settlements	—			(9,655		)	(2,555		)
Balance, end of year	$	14,967		$	15,401		$	29,533

Tax years open to examination by major taxing jurisdictions

The Company currently has the following tax years open to examination by major taxing jurisdictions:



	Tax Years:
United States Federal	2012 - 2014
State of California	2012 - 2014
State of Massachusetts	2011 - 2014
State of Oregon	2012 - 2014
Sweden	2011 - 2014
United Kingdom	2011 - 2014
Belgium	2011 - 2014