Income Taxes (Tables)

12 Months Ended

Jul. 31, 2019

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

	Fiscal Year Ended July 31,
	2019			2018			2017
	(in thousands)

U.S. operations	$	(1,302	)	$	(948	)	$	4,758
Foreign operations (primarily South American operations)		528			1,102			(80	)
(Loss) income before income tax provision	$	(774	)	$	154		$	4,678

Income Tax (Benefit) Provision

The Company’s income tax (benefit) provision is summarized in the following table.

	Fiscal Year Ended July 31,
	2019			2018			2017
	(in thousands)
Current income tax provision (benefit):
Federal	$	78		$	(62	)	$	(149	)
State		90			26			42
Foreign		494			228			282
Total current		662			192			175

Deferred income tax provision (benefit):
Federal		(24	)		289			1,653
State		1			(75	)		308
Foreign		(1,303	)		(148	)		31
Total deferred		(1,326	)		66			1,992
Total income tax (benefit) provision	$	(664	)	$	258		$	2,167

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,
	2019			2018			2017
	(in thousands)
Income tax (benefit) provision at the U.S. federal statutory income tax rate	$	(163	)	$	41		$	1,590
Tax on Foreign Earnings		138			129			---
Change in Tax Rates under Tax Act		16			322			---
International rate differences		80			27			33
Peru non-deductible expenses		---			14			53
Foreign dividend income		---			---			240
Income from “pass-through” entities taxable to noncontrolling partners		(16	)		---			(1	)
Re-evaluation and settlements of tax contingencies		---			---			(33	)
Transaction Costs		69			---			---
Change in valuation allowance		(1,241	)		(19	)		98
State taxes, net of federal benefit		75			(32	)		200
Other foreign taxes, net of federal benefit		109			(95	)		(111	)
Other permanent differences		269			(129	)		98
Income tax (benefit) provision, as reported on the consolidated statements of operations	$	(664	)	$	258		$	2,167

Deferred Tax Assets and Liabilities

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

	July 31,
	2019			2018
	(in thousands)
Deferred tax assets:
Net operating loss carryforwards	$	1,413		$	1,081
Accrued compensation and expenses		623			611
Federal benefit from foreign accounting differences		448			460
Contract and other reserves		253			311
Foreign tax credit		296			296
Capital loss carryforwards		234			143
Fixed assets and intangibles		57			---
Other		155			202
Deferred tax assets		3,479			3,104
Less: valuation allowance		(859	)		(2,006	)
Net deferred tax assets	$	2,620		$	1,098

Deferred tax liabilities:
Fixed assets and intangibles	$	---		$	(39	)
Federal expense on state deferred taxes		(62	)		(60	)
Federal expense from foreign accounting differences		(2	)		(7	)
Unremitted foreign earnings		(417	)		(206	)
Other		(9	)		3
Net deferred tax liabilities	$	(490	)	$	(309	)

Deferred Tax Asset Valuation Allowance

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

	Fiscal Year Ended July 31,
	2019			2018
	(in thousands)

Balance at beginning of period	$	2,006		$	2,020
Additions during the period		420			60
Reductions during period		(1,567	)		(74	)
Balance at end of period	$	859		$	2,006