Income Taxes

The domestic and foreign components of Income (loss) before provision (benefit) for income taxes are as follows:



	Fiscal
	2014			2013		2012
Domestic	$	(100,786	)	$	34,597	$	(224,993	)
Foreign	(13,450		)	11,866		(21,073		)
Consolidated	$	(114,236	)	$	46,463	$	(246,066	)

The provision/(benefit) for income taxes consists of the following:



	Fiscal
	2014			2013		2012
Current
Federal	$	6,376		$	8,877	$	14,166
State	2,112			2,203		2,962
Foreign	1,821			2,433		2,938
Total current	10,309			13,513		20,066
Deferred	(8,672		)	4,144		(18,398		)
Total provision (benefit) for income taxes	$	1,637		$	17,657	$	1,668

Reconciliations between income taxes computed using the federal statutory income tax rate and the Company’s effective tax rate are as follows:



	Fiscal
	2014		2013		2012
Federal statutory tax rate	35.0	%	35.0	%	35.0	%
Foreign taxes, net of foreign tax credits	(0.7	)	(2.9	)	(5.5	)
Non-deductible expenses	0.3		(0.9	)	0.3
State income taxes, net of federal benefit	(0.2	)	2.9		0.2
Valuation allowance	—		—		—
Non-deductible goodwill impairment loss	(35.2	)	—		(31.5	)
Equity awards	(1.4	)	3.3		(0.3	)
Other, net	0.8		0.6		1.1
Effective tax rate	(1.4	)%	38.0	%	(0.7	)%

The effective tax rate of (1.4)% for Fiscal 2014 was primarily due to $114,920 of non-deductible goodwill impairment loss (see Note 5), a decrease in uncertain income tax positions (including interest and penalties) and the benefit associated with the Fiscal 2013 federal return to provision reconciliation partially offset by the write-off of certain deferred tax assets related to equity awards. The effective tax rate of (0.7)% for Fiscal 2012 was primarily due to $262,703 of non-deductible goodwill impairment loss (see Note 5) and a reduction in reserves of $1,579 related to the settlement of an Internal Revenue Service ("IRS") audit for Fiscal 2007 through Fiscal 2010 and a state audit for Fiscal 2005 through Fiscal 2011.

The components of current and long-term deferred tax liabilities/assets are as follows:



	March 31,
	2014			2013
Deferred Tax Liabilities
Goodwill and intangibles	$	17,251		$	29,206
Unremitted earnings of foreign subsidiaries	397			213
Other	256			534
Gross deferred tax liabilities	17,904			29,953
Deferred Tax Assets
Net operating losses	29,455			29,631
Basis of finished goods inventory	6,299			7,714
Reserve for bad debts	1,193			1,169
Foreign tax credit carry-forwards	195			938
Accrued employee costs	8,609			10,211
Stock-based compensation	8,712			10,966
Other	2,836			2,530
Gross deferred tax assets	57,299			63,159
Valuation allowance	(3,518		)	(3,518		)
Net deferred tax assets	53,781			59,641
Net deferred tax assets/(liabilities)	$	35,877		$	29,688

The net deferred tax asset of $35,877 in the table above is classified as either current or non-current under Other assets within the Company's Consolidated Balance Sheets. At March 31, 2014, the Company had $47,099, $107,498 and $25,115 of federal, state and foreign gross net operating loss carry-forwards, respectively. As a result of the Company’s acquisitions of InnerWireless and ACS Communications, Inc., Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"), limits the amount of net operating losses available to the Company to approximately $6,178 per year. The federal gross net operating loss carry-forwards expire in Fiscal 2031. The state gross net operating loss carry-forwards expire at various times through Fiscal 2034 and the foreign gross net operating loss carry-forwards expire at various times through Fiscal 2024, with the exception of $208 for Austria, $744 for Belgium and $9,488 for Brazil, which have no expirations.

A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company has recorded a valuation allowance of $3,518 for certain state and foreign net operating loss carry-forwards anticipated to produce no tax benefit.

In general, except for certain earnings associated with inter-company loan balances, it is the Company’s intention to reinvest all undistributed earnings of non-U.S. subsidiaries for an indefinite period of time. Therefore, except for the exceptions noted above, no deferred U.S. income taxes have been provided on undistributed earnings of non-U.S. subsidiaries, which aggregate approximately $7,589 based on exchange rates at March 31, 2014, thus there is no unrealized currency translation adjustments related to translation of foreign denominated balance sheets.

A reconciliation of the change in the tax liability for unrecognized tax benefits is as follows:



	Fiscal
	2014			2013			2012
Balance at beginning of year	$	5,340		$	5,204		$	8,318
Additions for tax positions related to the current year	193			465			801
Additions for tax positions related to prior years	209			213			804
Reductions for tax positions related to prior years	(896		)	(542		)	(4,235		)
Settlements	(462		)	—			(484		)
Balance at end of year	$	4,384		$	5,340		$	5,204

Unrecognized tax benefits are classified as either current or non-current under Other liabilities within the Company's Consolidated Balance Sheets. Of the $4,384 noted above, the Company expects that $234 will reverse in the next twelve-months. As of March 31, 2014, 2013 and 2012, the Company recorded $1,114, $1,001 and $1,812, respectively, of interest and penalties related to uncertain tax positions in current liabilities within Income taxes, all of which impacted the Company's effective tax rate.

During Fiscal 2013 the IRS commenced an examination of the Company's United States federal income tax return for Fiscal 2011 and 2012. During Fiscal 2014, the IRS concluded its examination with no proposed adjustments for Fiscal 2011 and Fiscal 2012.

Fiscal 2013 remains open to examination by the IRS and Fiscal 2009 through Fiscal 2013 remain open to examination by certain state and foreign taxing jurisdictions.