Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Schedule of Income before Income Tax, Domestic and Foreign

The consolidated loss before income taxes, by domestic and foreign sources, is as follows:

(in thousands)	Years ended December 31,
	2014				2013
Domestic		$	(4,608	)		$	(7,797	)
Foreign			(1,968	)			(2,568	)
Total		$	(6,576	)		$	(10,365	)

Schedule of Components of Income Tax Expense (Benefit)

The provision for income taxes is as follows:

(in thousands)	Years ended December 31,
	2014			2013
Current:
Federal	$	-		$	4
State		10			22
Foreign		178			382
Subtotal		188			408

Deferred:
Federal		24			-
Foreign		(46	)		(262	)
Subtotal		(22	)		(262	)
Total	$	166		$	146

Schedule of Effective Income Tax Rate Reconciliation

The effective income tax rate differed from the statutory federal income tax rate due to the following:

	Effective Tax Rate Percentage (%)
	Years ended December 31,
	2014	2013
Statutory federal income tax rate	34.0%	34.0%
State income taxes, net of federal tax benefit	(0.1)%	(0.1)%
Effect of foreign operations	(10.2)%	(6.9)%
Tax benefit resulting from OCI allocation	0.0%	0.5%
Change in valuation allowance	(22.8)%	(12.1)%
Other, principally permanent differences	(3.4)%	(16.8)%
Effective tax rate	(2.5)%	(1.4)%

Schedule of Deferred Tax Assets and Liabilities

Deferred income taxes arise from temporary differences between the tax bases of assets and liabilities and their reported amounts in the financial statements. A summary of the tax effect of the significant components of the deferred income tax liabilities is as follows:

(in thousands)	Years ended December 31,
	2014			2013
Deferred tax assets:
Net operating loss carryforwards	$	7,745		$	5,589
Capital loss carryforwards		615			703
Accruals		485			337
Reserves		521			611
Alternative minimum tax credit carryforwards		166			166
Other		1,484			1,701
Total deferred tax asset		11,016			9,107
Valuation allowance		(10,006	)		(7,057	)
Total deferred tax asset less valuation allowance		1,010			2,050

Deferred tax liabilities:
Undistributed earnings of foreign subsidiary		(102	)		(1,228	)
Software development costs		(542	)		(384	)
Other		(397	)		(491	)
Total deferred tax liability		(1,041	)		(2,103	)

Net deferred tax liability	$	(31	)	$	(53	)