Income Taxes (Tables)

12 Months Ended

Apr. 30, 2018

Income tax expense consisted of the following:


	Years ended April 30,
	2018		2017		2016
	(In thousands)
Current:
Federal	$	2,298	$	5,643	$	4,105
State		743		676		665

		3,041		6,319		4,770

Deferred:
Federal		321		558		(299	)
State		300		117		(13	)

		621		675		(312	)

	$	3,662	$	6,994	$	4,458

Earnings before Income Taxes Due to Change in Effective Income Tax Rate

The Company’s actual income tax expense differs from the “expected” income tax expense calculated by applying our blended U.S. Federal statutory tax rate of 30.3% for fiscal year 2018 and the Federal statutory rate of 35% for fiscal years 2017 and 2016, to earnings before income taxes as follows:


	Years ended April 30,
	2018			2017			2016
	(In thousands)
Computed “expected” income tax expense	$	4,763		$	7,565		$	5,145
Increase (decrease) in income taxes resulting from:
State income taxes, net of federal income tax effect		891			592			435
Research and development credits		(493	)		(520	)		(694	)
Change in valuation allowance for deferred tax assets		4			(293	)		(2	)
Tax contingencies		(13	)		(42	)		(13	)
NQ stock options granted		102			106			26
Rate change – tax reform		(1,206	)		—			—
Other, net, including permanent items		(386	)		(414	)		(439	)

	$	3,662		$	6,994		$	4,458

Significant Components of Deferred Income Tax (Benefit) Expense Attributable to Income from Continuing Operations before Income Taxes

The significant components of deferred income tax (benefit) expense attributable to income from continuing operations before income taxes for the years ended April 30, 2018, 2017, and 2016 are as follows:


	Years ended April 30,
	2018			2017			2016
	(In thousands)
Deferred tax expense/(benefit)	$	1,823		$	968		$	(310	)
Deferred tax benefit related to tax reform		(1,206	)		—			—
Increase (decrease) in the valuation allowance for deferred tax assets		4			(293	)		(2	)

	$	621		$	675		$	(312	)

Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at April 30, 2018 and 2017 are presented as follows:


	2018			2017
	(In thousands)
Deferred tax assets:
Accruals and expenses not deducted for tax purposes	$	339		$	461
State net operating loss carryforwards		226			295
Fixed asset basis differences		883			1,384
Nonqualified stock options		762			1,679
Deferred revenue		53			234

Total gross deferred tax assets		2,263			4,053
Less valuation allowance		170			166

Net deferred tax		2,093			3,887

Deferred tax liabilities:
Capitalized computer software development costs		(2,432	)		(3,298	)

Net gains/losses on trading securities		(938	)		(1,019	)

Goodwill and intangible assets basis differences		(601	)		(939	)
Deferred agent commissions		(737	)		(625	)

Total gross deferred tax liabilities		(4,708	)		(5,881	)

Net deferred tax liabilities	$	(2,615	)	$	(1,994	)

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows, excluding interest and penalties (in thousands):


	2018			2017
Balance at beginning of the period	$	33		$	54
Decreases as a result of positions taken during prior periods		(1	)		(25	)
Increases as a result of positions taken during the current period		—			4

Balance at April 30,	$	32		$	33