Income Taxes (Tables)

12 Months Ended

Jul. 31, 2018

Income before income tax provision is summarized in the following table.

	Fiscal Year Ended July 31,
	2018			2017 (Restated)			2016 (Restated)
	(in thousands)

U.S. operations	$	(948	)	$	4,758		$	4,478
Foreign operations (primarily South American operations)		1,102			(80	)		(1,178	)
Income before income tax provision	$	154		$	4,678		$	3,300

Income Tax Provision

The income tax provision is summarized in the following table.

	Fiscal Year Ended July 31,
	2018			2017 (Restated)			2016 (Restated)
	(in thousands)
Current:
Federal	$	(62	)	$	(149	)	$	1,155
State		26			42			177
Foreign		228			282			577
Total current		192			175			1,909

Deferred:
Federal		289			1,653			663
State		(75	)		308			270
Foreign		(148	)		31			304
Total deferred		66			1,992			1,237
Total income tax provision	$	258		$	2,167		$	3,146

Reconciliation of Income Tax Provision to Effective Tax Rate

A reconciliation of the income tax provision using the statutory U.S. income tax rate compared with the actual income tax provision reported on the consolidated statements of operations is summarized in the following table.

	Fiscal Year Ended July 31,
	2018			2017 (Restated)			2016 (Restated)
	(in thousands)

Income tax provision (benefit) at the U.S. federal statutory income tax rate	$	41		$	1,590		$	1,122
Tax on Foreign Earnings		129			---			---
Change in Tax Rates under Tax Act		322			---			---
International rate differences		27			33			(10	)
Peru non-deductible expenses		14			53			59
Foreign dividend income		---			240			263
Income from "pass-through" entities taxable to noncontrolling partners		---			(1	)		(39	)
Re-evaluation and settlements of tax contingencies		---			(33	)		---
Change in valuation allowance		(19	)		98			1,582
State taxes, net of federal benefit		(32	)		200			312
Other foreign taxes, net of federal benefit		(95	)		(111	)		(277	)
Other permanent differences		(129	)		98			134
Income tax provision, as reported on the consolidated statements of operations	$	258		$	2,167		$	3,146

Deferred Tax Assets and Liabilities

The significant components of deferred tax assets and liabilities are summarized in the following table.

	July 31,
	2018			2017 (Restated)
	(in thousands)
Deferred tax assets:
Net operating loss carryforwards	$	1,081		$	1,470
Accrued compensation and expenses		611			752
Federal benefit from foreign accounting differences		460			435
Contract and other reserves		311			463
Foreign tax credit		296			296
Capital loss carryforwards		143			217
Foreign and state income taxes		---			17
Other		202			376
Deferred tax assets		3,104			4,026
Less: valuation allowance		(2,006	)		(2,020	)
Net deferred tax assets	$	1,098		$	2,006

Deferred tax liabilities:
Fixed assets and intangibles	$	(39	)	$	(102	)
Federal expense on state deferred taxes		(60	)		(74	)
Federal expense from foreign accounting differences		(7	)		(332	)
Unremitted foreign earnings		(206	)		(623	)
Other		3			(26	)
Net deferred tax liabilities	$	(309	)	$	(1,157	)

Deferred Tax Asset Valuation Allowance

Activity within the deferred tax asset valuation allowance is summarized in the following table.

	Fiscal Year Ended July 31,
	2018			2017 (Restated)
	(in thousands)

Balance at beginning of period	$	2,020		$	2,278
Additions during the period		60			2
Reductions during period		(74	)		(260	)
Balance at end of period	$	2,006		$	2,020