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Income taxes
9 Months Ended
Mar. 29, 2014
Income Tax Disclosure [Abstract]  
Income taxes
Income taxes
The Company’s effective tax rate on its income before income taxes was 31.0% in the third quarter of fiscal 2014 as compared with 40.3% in the third quarter of fiscal 2013. During the third quarter of fiscal 2014, the Company's effective tax rate was favorably impacted by the mix of income in lower tax rate jurisdictions and a lower level of increases to valuation allowances and reserves.
For the first nine months of fiscal 2014 and 2013, the Company's effective tax rate was 31.6% and 23.2%, respectively. This increase in the effective tax rate was due primarily to the fiscal 2013 effective tax rate including the favorable settlement of two IRS audits for the Company and an acquired company, and a non-taxable gain on a bargain purchase, partially offset by increases to valuation allowances and reserves.  Due to the reduced level of income before income taxes in the first nine months of fiscal 2013, the net favorable impact of these items on the effective tax rate was significant.  The effective tax rate for the first nine months of fiscal 2013 was also favorably impacted, to a lesser extent, by the mix of income earned in lower tax rate jurisdictions.
Prior to fiscal 2011, the Company had established a full valuation allowance against significant net operating loss carry-forward deferred tax assets related to a legal entity in EMEA due to, among several other factors, a history of losses in that entity.  Since fiscal 2011, the Company determined that a full valuation allowance related to this entity was no longer required due to the expected continuation of improved earnings in the foreseeable future and, as a result, the Company's effective tax rate was positively impacted (decreased) from the release of portions of the valuation allowance. The Company will continue to evaluate the need for a valuation allowance against these deferred tax assets and will adjust the valuation allowance as deemed appropriate which, if reduced, could result in a significant decrease to the effective tax rate.  The carrying value of the Company’s deferred tax assets is dependent upon the Company’s ability to generate sufficient future taxable income in certain tax jurisdictions and factors that are considered in such an evaluation include historic levels of income, expectations and risk associated with estimates of future taxable income and ongoing prudent and feasible tax planning strategies.