Income Taxes (Tables)

12 Months Ended

Dec. 31, 2011

Income from continuing operations for the three years ended December 31, was as follows:

	2011		2010		2009
U.S. operations	$	40,282	$	26,297	$	12,103
Foreign operations		8,448		8,430		(36,423	)
Total	$	48,730	$	34,727	$	(24,320	)

Income tax expense (benefit)

Income tax expense (benefit) for the three years ended December 31, was as follows:

	2011			2010			2009
Current:
Federal	$	10,321		$	6,756		$	(337	)
Foreign		2,277			3,005			1,284
State		1,450			1,214			236
	$	14,048		$	10,975		$	1,183
Deferred:
Federal	$	2,330		$	(10,541	)	$	1,897
Foreign		(203	)		(248	)		(1,444	)
State		(158	)		(262	)		285
	$	1,969		$	(11,051	)	$	738
Total:
Federal	$	12,651		$	(3,785	)	$	1,560
Foreign		2,074			2,757			(160	)
State		1,292			952			521
	$	16,017		$	(76	)	$	1,921

Effective tax rate reconciliation

Our effective income tax rate varied from the U.S. federal statutory tax rate for the three years ended December 31, was as follows:

	2011			2010			2009
Tax at statutory rate		35.0	%		35.0	%		(35.0	%)
Increases (decreases) in the tax rate from:
State and local taxex, net of federal benefit		2.0			0.7			1.1
Effect of foreign operations		0.5			0.5			(7.0	)
International restructuring		-			(31.4	)		(9.4	)
Goodwill impairment - non-deductible		-			-			56.9
Effect of changes in valuation allowances		-			0.1			(0.7	)
Domestic production activities deduction		(1.6	)		(3.0	)		0.8
Other, net		(3.0	)		(2.1	)		1.2
Effective income tax rate		32.9	%		(0.2	%)		7.9	%

Deferred tax assets and liabilities

Deferred tax assets and liabilities were comprised of the following as of December 31:

	2011			2010			2009
Deferred tax assets:
Inventories, principally due to additional costs inventoried for
tax purposes and changes in inventory reserves	$	426		$	1,081		$	867
Employee wages and benefits, principally due to accruals for
financial reporting purposes		20,910			17,948			16,050
Warranty reserves accrued for financial reporting purposes		2,625			2,175			1,803
Accounts receivable, principally due to allowance for doubtful
accounts and tax accounting method for equipment rentals		1,464			1,252			1,396
Tax loss carryforwards		5,915			12,725			12,987
Valuation allowance		(3,229	)		(9,170	)		(9,131	)
Tax credit carryforwards		8,554			10,119			2,385
Other		1,777			1,937			1,177
Total deferred tax assets	$	38,442		$	38,067		$	27,534
Deferred tax liabilities:
Property, Plant and Equipment, principally due to differences in
depreciation and related gains	$	9,167		$	8,562		$	8,592
Goodwill and Intangible Assets		7,093			8,390			9,086
Total deferred tax liabilities	$	16,260		$	16,952		$	17,678
Net deferred tax assets	$	22,182		$	21,115		$	9,856

Reconciliation of unrecognized tax benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

Balance at January 1, 2011	$	5,272
Decreases as a result of tax positions taken during a prior period		(765	)
Increases as a result of tax positions taken during the current year		828
Decreases for tax positions related to acquired entities during a prior period		-
Decreases relating to settlements with taxing authorities		(193	)
Reductions as a result of a lapse of the applicable statute of limitations		(1,551	)
Decreases as a result of foreign currency fluctuations		(167	)
Balance at December 31, 2011	$	3,424

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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