Note 16 - Income Taxes

9 Months Ended

Feb. 29, 2016

Notes to Financial Statements

Income Tax Disclosure [Text Block]

16. INCOME TAXES

The effective tax rate for the nine months ended February 29, 2016 and February 28, 2015 was 33.7% and -73.0%, respectively.  The difference between the federal statutory rate and the effective tax rate for the nine months ended February 29, 2016 was primarily due to income subject to tax in the various tax jurisdictions with rates that differ from the U.S. statutory tax rate, the impact of recording U.S. income taxes associated with future remittances of un-repatriated foreign earnings, and changes in the U.S. tax law related to the R&D tax credit during the third quarter of fiscal 2016. The difference between the federal statutory rate and the effective tax rate for the nine months ended February 28, 2015 was primarily due to income subject to tax in the various tax jurisdictions with rates that differ from the U.S. statutory tax rate and the impact of recording U.S. income taxes associated with future remittances of un-repatriated foreign earnings. In addition, during the third quarter of fiscal 2015, the Company changed its election with regard to the treatment of its foreign tax credits.

The Company does not consider itself to be permanently reinvested with respect to its accumulated and un-repatriated earnings of each foreign subsidiary. Accordingly, the Company has provided for deferred taxes on future remittances of the un-repatriated earnings of its foreign subsidiaries. The Company continues to consider its investment in each foreign subsidiary in excess of its accumulated and un-repatriated earnings to be permanently reinvested and thus has not recorded a deferred tax liability on that amount.