Note 8:

Income Taxes

The U.S. and foreign components of earnings from continuing operations before income taxes and the provision or benefit for income taxes consisted of the following:

	Years ended March 31,
	2016			2015			2014
Components of (loss) earnings from continuing operations before income taxes:
United States	$	(15.4	)	$	31.1		$	14.1
Foreign		5.5			10.1			9.9
Total (loss) earnings from continuing operations before income taxes	$	(9.9	)	$	41.2		$	24.0

Income tax (benefit) expense:
Federal:
Current	$	0.1		$	0.4		$	(2.0	)
Deferred		(13.0	)		7.1			(95.8	)
State:
Current		0.2			-			0.2
Deferred		(2.5	)		1.1			(21.4	)
Foreign:
Current		9.6			12.7			10.0
Deferred		(3.3	)		(2.3	)		1.1
Total income tax (benefit) expense	$	(8.9	)	$	19.0		$	(107.9	)

The Company allocates income tax expense among continuing operations, discontinued operations, and other comprehensive income. The Company applies accounting for income taxes by tax jurisdiction, and in periods in which there is a loss from continuing operations before income taxes and pre-tax income in other categories (e.g., discontinued operations or other comprehensive income), it first allocates income tax expense to the other sources of income, and records a related tax benefit in continuing operations.

Income tax expense attributable to earnings from continuing operations before income taxes differed from the amounts computed by applying the statutory U.S. federal income tax rate as a result of the following:

	Years ended March 31,
	2016			2015			2014
Statutory federal tax		35.0	%		35.0	%		35.0	%
State taxes, net of federal benefit		11.5			2.4			2.1
Taxes on non-U.S. earnings and losses		26.4			(4.9	)		(3.8	)
Valuation allowance		(20.9	)		8.3			(471.7	)
Tax credits		20.5			(6.1	)		(7.1	)
Compensation		(3.7	)		1.0			0.4
Tax rate or law changes		1.3			1.2			(9.2	)
Uncertain tax positions, net of settlements		(4.3	)		2.2			0.4
Dividend repatriation		16.0			2.4			5.8
Other		8.1			4.6			(1.5	)
Effective tax rate		89.9	%		46.1	%		(449.6	%)

The Company recorded an additional valuation allowance of $5.0 million, $2.6 million and $12.3 million in fiscal 2016, 2015, and 2014, respectively, against net deferred tax assets in certain jurisdictions after determining it was more likely than not that the net deferred tax assets in these jurisdictions will not be realized. The Company will continue to provide a valuation allowance against its net deferred tax assets in each of the applicable jurisdictions going forward until the need for a valuation allowance is eliminated. The need for a valuation allowance is eliminated when the Company determines it is more likely than not the deferred tax assets will be realized.

During fiscal 2016 and 2014, the Company concluded it no longer needed a valuation allowance on certain deferred tax assets after determining it was more likely than not they would be realized. As a result, the Company recorded reversals of its deferred tax asset valuation allowance of $3.0 million and $119.2 million in fiscal 2016 and 2014, respectively. Also during fiscal 2014, the Company recorded income tax benefits totaling $2.2 million related to foreign tax law changes.

The tax effects of temporary differences that gave rise to deferred tax assets and liabilities were as follows:

	March 31,
	2016			2015
Deferred tax assets:
Accounts receivable	$	0.1		$	0.3
Inventories		3.6			3.8
Plant and equipment		4.3			0.8
Pension and employee benefits		52.6			50.5
Net operating loss, capital loss, and credit carryforwards		109.4			105.0
Other, principally accrued liabilities		6.9			6.8
Total gross deferred tax assets		176.9			167.2
Less: valuation allowance		(50.8	)		(48.0	)
Net deferred tax assets		126.1			119.2

Deferred tax liabilities:
Plant and equipment		5.5			5.3
Goodwill		0.6			0.6
Other		1.1			1.0
Total gross deferred tax liabilities		7.2			6.9
Net deferred tax asset	$	118.9		$	112.3

As of March 31, 2016, the Company adopted new accounting guidance, which requires that all deferred taxes be presented as non-current on the consolidated balance sheets. See Note 1 for additional information.

Unrecognized tax benefits were as follows:

	Years ended March 31,
	2016			2015
Beginning balance	$	5.6		$	2.1
Gross increases - tax positions in prior period		-			3.1
Gross decreases - tax positions in prior period		(0.1	)		-
Gross increases - tax positions in current period		0.4			0.4
Ending balance	$	5.9		$	5.6

The Company’s liability for unrecognized tax benefits as of March 31, 2016 was $5.9 million, and if recognized, $3.5 million would have an effective tax rate impact.

The Company recognizes interest and penalties related to unrecognized tax benefits as a component of income tax expense. At March 31, 2016 and 2015, accrued interest and penalties were not significant.

The Company files income tax returns in multiple jurisdictions and is subject to examination by taxing authorities throughout the world. At March 31, 2016, the Company was under income tax examination in a number of foreign jurisdictions. The Company does not anticipate a significant change in unrecognized tax benefits during the next twelve months.

The following tax years remain subject to examination for the Company’s major tax jurisdictions:

Austria	Fiscal 2012 - 2015
Brazil	Calendar 2011 - 2015
Germany	Fiscal 2012 - 2015
United States	Fiscal 2013 - 2015

At March 31, 2016, the Company had federal and state research and development tax credits of $23.3 million that, if not utilized against domestic taxes, will expire between fiscal 2018 and 2036. The Company also had various state and local tax loss carry forwards of $190.8 million that, if not utilized against state apportioned taxable income, will expire at various times during fiscal 2017 through 2036. In addition, the Company had tax loss carry forwards of $330.7 million in various tax jurisdictions throughout the world. Certain of the carry forwards in the U.S. and many in foreign jurisdictions are offset by a valuation allowance. If not utilized against taxable income, $156.9 million of these tax losses will expire at various times during fiscal 2017 through 2035, and $173.8 million, mainly related to Germany, Austria and India, will not expire due to an unlimited carry-forward period.

At March 31, 2016, the Company provided $1.1 million of tax on undistributed earnings for certain subsidiaries not considered permanently reinvested. Undistributed earnings totaling $491.0 million are considered permanently reinvested in the Company’s remaining foreign operations, and no provision has been made for taxes that would be payable upon the distribution of such earnings. It is not practicable to estimate the amount of unrecognized withholding taxes and deferred tax liability on such earnings.