INCOME TAXES

9 Months Ended

Jun. 28, 2020

For the three and nine months ended June 26, 2020 and June 28, 2019, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:



	Three Months Ended						Nine Months Ended
(thousands, except tax rate data)	June 26, 2020			June 28, 2019			June 26, 2020			June 28, 2019
Profit before income taxes	$	15,557		$	28,892		$	52,523		$	63,243
Income tax expense	2,688			6,826			12,837			15,733
Effective income tax rate	17.3		%	23.6		%	24.4		%	24.9		%

The decrease in the effective tax rate for the three and nine months ended June 26, 2020 compared to the prior year periods is primarily due to a decrease in reserves for unrecognized tax benefits from the expiration of statutes of limitations.

The impact of the Company’s operations in jurisdictions where a valuation allowance is assessed is removed from the overall effective tax rate methodology and recorded directly based on year to date results for the year for which no tax expense or benefit can be recognized. The significant tax jurisdictions that have a valuation allowance for the periods ended June 26, 2020 and June 28, 2019 were:



June 26, 2020	June 28, 2019
France	France
Indonesia	Indonesia
Switzerland	Switzerland

The Company regularly assesses the adequacy of its provisions for income tax contingencies in accordance with the applicable authoritative guidance on accounting for income taxes. As a result, the Company may adjust the reserves for unrecognized tax benefits due to the impact of changes in its assumptions or as a result of new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities and lapses of statutes of limitation. The Company’s 2020 fiscal year tax expense is anticipated to be unchanged related to uncertain income tax positions.

In accordance with its accounting policy, the Company recognizes accrued interest and penalties related to unrecognized benefits as a component of income tax expense. The Company is projecting accrued interest of $100 related to uncertain income tax positions for the fiscal year ending October 2, 2020.

The Company files income tax returns, including returns for its subsidiaries, with federal, state, local and foreign taxing jurisdictions. As of the date of this report, the following tax years remain open to examination by the respective significant tax jurisdictions:



Jurisdiction	Fiscal Years
United States	2017-2019
Canada	2016-2019
France	2016-2019
Germany	2017-2019
Italy	2018-2019
Switzerland	2009-2019

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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