Income Taxes (Tables)

12 Months Ended

Apr. 30, 2020

Income tax expense (benefit) consisted of the following:



	Years ended April 30,
	2020			2019		2018
	(in thousands)
Current:
Federal	$	295		$	184	$	2,298
State	370			334		743
	665			518		3,041
Deferred:
Federal	(513		)	256		321
State	(96		)	64		300
	(609		)	320		621
	$	56		$	838	$	3,662

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 the Federal statutory rate of 21.0% for fiscal 2020 and 2019 and our blended U.S. Federal statutory rate of 30.3% for fiscal 2018, to earnings before income taxes as follows:



	Years ended April 30,
	2020			2019			2018
	(in thousands)
Computed “expected” income tax expense	$	1,428		$	1,605		$	4,763
Increase (decrease) in income taxes resulting from:
State income taxes, net of federal income tax effect	214			339			891
Research and development credits	(703		)	(678		)	(493		)
Excess tax benefits from stock option deductions	(737		)	(251		)	(165		)
Foreign tax credits	(164		)	(112		)	(211		)
Rate change – tax reform	—			—			(1,206		)
Other, net, including permanent items	18			(65		)	83
	$	56		$	838		$	3,662

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

The significant components of deferred income tax expense attributable to income from continuing operations before income taxes for the years ended April 30, 2020, 2019, and 2018 are as follows:



	Years ended April 30,
	2020			2019			2018
	(in thousands)
Deferred tax (benefit) expense	$	(639	)	$	330		$	1,823
Deferred tax benefit related to tax reform	—			—			(1,206		)
Increase (decrease) in the valuation allowance for deferred tax assets	30			(10		)	4
	$	(609	)	$	320		$	621

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, 2020 and 2019 are presented as follows:



	2020			2019
	(in thousands)
Deferred tax assets:
Accruals and expenses not deducted for tax purposes	$	363		$	328
State net operating loss carryforwards	226			217
Fixed asset basis differences	822			831
Nonqualified stock options	848			858
Right of use liability	547			—
Tax credit carryforwards	83			—
Total gross deferred tax assets	2,889			2,234
Less valuation allowance	(190		)	(160		)
Net deferred tax	2,699			2,074
Deferred tax liabilities:
Capitalized computer software development costs	(2,090		)	(2,766		)
Net gains/losses on trading securities	(1,005		)	(1,183		)
Goodwill and intangible assets basis differences	(746		)	(639		)
Right of use asset	(513		)	—
Deferred agent commissions	(1,242		)	(1,000		)
Total gross deferred tax liabilities	(5,596		)	(5,588		)
Net deferred tax liabilities	$	(2,897	)	$	(3,514	)

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):



	2020			2019
Balance at beginning of the period	$	21		$	32
Decreases as a result of positions taken during prior periods	(6		)	(11		)
Increases as a result of positions taken during the current period	—			—
Balance at April 30,	$	15		$	21