INCOME TAXES (Tables)

12 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

Components of income (loss) before income taxes

The components of continuing operations (loss) income before income taxes are as follows:

	Fiscal Years
	2019			2018			2017
	(Dollars in thousands)
(Loss) income before income taxes:
U.S.	$	(17,513	)	$	(16,604	)	$	2,467
International	(4,754		)	6,413			3,462
	$	(22,267	)	$	(10,191	)	$	5,929

Provision (benefit) for income taxes

The (benefit) provision for income taxes consists of:

	Fiscal Years
	2019			2018			2017
	(Dollars in thousands)
Current:
U.S.	$	(519	)	$	2,151		$	994
International	1,069			1,894			268
Deferred:
U.S.	(2,303		)	(73,728		)	7,901
International	(392		)	(129		)	61
	$	(2,145	)	$	(69,812	)	$	9,224

Provision for income taxes, reconciliation to applicable U.S. statutory rate

The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory rate to earnings (loss) before income taxes, as a result of the following:

	Fiscal Years
	2019		2018		2017
U.S. statutory rate	21.0	%	28.0	%	35.0	%
State income taxes, net of federal income tax benefit	0.5		14.8		8.7
Valuation allowance (1)	(14.5	)	560.8		117.0
Foreign income taxes at other than U.S. rates	0.9		(0.5	)	(4.9	)
Work opportunity tax credits	7.2		15.2		(26.8	)
Deferred tax rate remeasurement	—		99.0		—
Uncertain tax positions	1.0		(15.9	)	—
Stock-based compensation	2.2		(15.8	)	25.2
Other, net (2)	(8.7	)	(0.6	)	1.4
	9.6	%	685.0	%	155.6	%

_______________________________________________________________________________

(1)     See Note 1 to the Consolidated Financial Statements.

(2)

The (8.7)% of Other, net in fiscal year 2019 includes the rate impact of goodwill derecognition and miscellaneous items of (5.9)% and (2.8)%, respectively. Miscellaneous items do not include any items in excess of 5% of computed tax. The (0.6)% of Other, net in fiscal year 2018 does not include the rate impact of any items in excess of 5% of computed tax. The other 1.4% of Other, net in fiscal year 2017 includes the rate impact of meals and entertainment expense disallowance, adjustments resulting from charitable contributions, officer life insurance and miscellaneous items of 6.3%, 10.0%, (7.8)% and (7.1)%, respectively. Miscellaneous items do not include any items in excess of 5% of computed tax.

Components of the net deferred tax assets and liabilities

The components of the net deferred tax assets and liabilities are as follows:

	June 30,
	2019			2018
	(Dollars in thousands)
Deferred tax assets:
Deferred rent	$	3,816		$	5,251
Payroll and payroll related costs	11,696			14,083
Net operating loss carryforwards	48,208			41,570
Tax credit carryforwards	36,966			35,102
Deferred franchise fees	7,508			6,818
Financial lease liability	7,387			—
Other	8,709			17,416
Subtotal	$	124,290		$	120,240
Valuation allowance	(70,707		)	(68,610		)
Total deferred tax assets	$	53,583		$	51,630
Deferred tax liabilities:
Goodwill and intangibles	$	(62,378	)	$	(72,670	)
Other	(9,129		)	(6,811		)
Total deferred tax liabilities	$	(71,507	)	$	(79,481	)
Net deferred tax liability	$	(17,924	)	$	(27,851	)

Unrecognized tax benefits

A rollforward of the unrecognized tax benefits is as follows:

	Fiscal Years
	2019			2018			2017
	(Dollars in thousands)
Balance at beginning of period	$	3,027		$	1,388		$	1,357
Additions based on tax positions related to the current year	287			553			259
Additions/(reductions) based on tax positions of prior years	(154		)	1,608			80
Reductions on tax positions related to the expiration of the statute of limitations	(397		)	(177		)	(179		)
Settlements	—			(345		)	(129		)
Balance at end of period	$	2,763		$	3,027		$	1,388