15. Income Taxes:

Components of income (loss) before income taxes were as follows (in thousands):

	YEAR ENDED SEPTEMBER 30,
	2015		2014		2013

United States	$	(41,700)	$	48,988	$	103,349
Foreign		(8,134)		4,555		(2,256)
	$	(49,834)	$	53,543	$	101,093

The provision (benefit) for income taxes consisted of the following (in thousands):

	YEAR ENDED SEPTEMBER 30,
	2015		2014		2013
Current:
Federal	$	(16,901)	$	15,352	$	31,954
Foreign		647		393		(19)
State		4		69		124
		(16,250)		15,814		32,059
Deferred:
Federal		964		41		43
Foreign		(1,907)		777		(566)
		(943)		818		(523)
	$	(17,193)	$	16,632	$	31,536

Actual income tax expense (benefit) differs from income tax expense computed by applying the U.S. statutory federal tax rate of 35.0% for each of the fiscal years ended September 30, 2015, 2014 and 2013 as follows (in thousands):

	YEAR ENDED SEPTEMBER 30,
	2015		2014		2013
Provision (benefit) for U.S. federal income tax at statutory rate	$	(17,442)	$	18,740	$	35,382
Effect of foreign income taxes		249		(629)		130
Manufacturers’/producers’ deduction		—		(1,496)		(3,048)
Research and experimentation tax credits		(400)		(208)		(661)
State income taxes, net of federal income tax benefit		2		45		81
Nondeductible expenses		488		205		253
Resolution of prior years’ tax matters		96		20		(467)
Contingency for uncertainty in income taxes		(121)		—		(51)
Other items		(65)		(45)		(83)
	$	(17,193)	$	16,632	$	31,536
Effective tax rate……………………………………………...		(34.5)%		31.1%		31.2%

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s net deferred income tax asset were as follows (in thousands):

	AS OF SEPTEMBER 30, 2015									AS OF SEPTEMBER 30, 2014
	U. S.			Non U.S.			Total			U. S.			Non U.S.			Total
Deferred income tax assets:
Allowance for doubtful accounts	$	681		$	21		$	702		$	214		$	73		$	287
Inventories		4,350			(34	)		4,316			5,035			(125	)		4,910
Net operating loss carry-forwards, tax credits and deferrals		—			2,270			2,270			—			871			871
Stock-based compensation		1,690			—			1,690			1,658			—			1,658
Accrued product warranty		803			6			809			317			8			325
Accrued compensated absences		520			—			520			579			—			579
Currency translation adjustments		101			—			101			1,344			—			1,344
Insurance and other reserves		62			43			105			1,088			31			1,119
		8,207			2,306			10,513			10,235			858			11,093
Deferred income tax liabilities:
Intangible assets		31			—			31			(285	)		—			(285	)
Property, plant and equipment and other		(5,264	)		(770	)		(6,034	)		(4,768	)		(1,121	)		(5,889	)
Subtotal deferred income tax assets		2,974			1,536			4,510			5,182			(263	)		4,919
Valuation allowance		—			—			—			—			—			—
Net deferred income tax assets	$	2,974		$	1,536		$	4,510		$	5,182		$	(263	)	$	4,919

Deferred income tax assets and liabilities are reported as follows in the accompanying consolidated balance sheets (in thousands):

	AS OF SEPTEMBER 30,
	2015			2014
Current deferred income tax asset	$	6,422		$	7,244
Non-current deferred income tax asset		1,586			75
Current deferred income tax liability		(10	)		(23	)
Non-current deferred income tax liability		(3,488	)		(2,377	)
	$	4,510		$	4,919

The financial reporting basis of investments in foreign subsidiaries exceed their tax basis. A deferred tax liability is not recorded for this temporary difference because the investment is essentially permanent. A reversal of the Company’s plans to permanently invest in these foreign operations would cause the excess to become taxable. At September 30, 2015 and 2014, the temporary difference related to undistributed earnings for which no deferred taxes have been provided was approximately $9.2 million and $16.1 million, respectively.

Tax return filings which are subject to review by local tax authorities by major jurisdiction are as follows:

—

United States—fiscal years ended September 30, 2012 through 2015

—

State of Texas—fiscal years ended September 30, 2011 through 2015

—

State of New York—fiscal years ended September 30, 2003 through 2015

—

State of California – fiscal years ended September 30, 2011 through 2015

—

State of Pennsylvania – fiscal years ended September 30, 2008 through 2015

—

Russian Federation—calendar years 2012 through 2015

—

Canada—fiscal years ended September 30, 2011 through 2015

—

United Kingdom—fiscal years ended September 30, 2006, 2012 through 2015

—

Colombia—calendar years 2013 through 2015

The following table is a reconciliation of the total amounts of unrecognized tax liabilities (in thousands):

Balance at October 1, 2012	$	355
Change in prior year tax positions		(22	)
Current tax positions		142
Settlements with taxing authorities		(47	)
Lapse of statute of limitations		(114	)
Balance at September 30, 2013		314
Change in prior year tax positions		9
Current tax positions		23
Settlements with taxing authorities		--
Lapse of statute of limitations		(45	)
Balance at September 30, 2014		301
Change in prior year tax positions		(187	)
Current tax positions		17
Settlements with taxing authorities		--
Lapse of statute of limitations		(56	)
Balance at September 30, 2015	$	75

As of September 30, 2015, the Company had net operating loss (“NOL”) carry-forwards of approximately $9.0 million in Canada and approximately $60,000 in the United Kingdom to offset future taxable income in those jurisdictions. The Company, using the “more likely than not” criteria, has determined these NOL carry-forwards will be utilized in full before they begin to expire. The NOL carry-forwards for Canada expire in 2033. The NOL carry-forwards for the United Kingdom currently have no expiration. Therefore, no valuation allowance against the Company’s deferred tax assets was considered necessary.

Management believes that adequate provisions for income taxes have been reflected in the consolidated financial statements and it is not aware of any significant exposure items that have not been reflected in the consolidated financial statements. Amounts considered probable of settlement within one year have been included in the accrued expenses and other liabilities in the accompanying consolidated balance sheets.