INCOME TAXES (TABLES)

12 Months Ended

Dec. 31, 2015

The sources of pre-tax operating income are as follows (in thousands):


	Year Ended December 31,
	2015		2014		2013
Domestic	$	25,402	$	20,569	$	10,816
Foreign		60,487		79,890		81,253
Total	$	85,889	$	100,459	$	92,069

Components of Income Tax Expense (Benefit)

The components of the Company’s Provision for (benefit from) income taxes are as follows (in thousands):


	Year Ended December 31,
	2015		2014		2013
Current provision for (benefit from)
Federal	$	4,094	$	(699)	$	(320)
State		1,829		270		150
Foreign		4,764		13,957		13,876
Total current provision for (benefit from)		10,687		13,528		13,706
Deferred provision for (benefit from)
Federal		(1,895)		10,148		4,674
State		1,085		423		195
Foreign		10,127		(1,057)		2,023
Total deferred provision for (benefit from)		9,317		9,514		6,892
Total provision for (benefit from) income taxes	$	20,004	$	23,042	$	20,598

Effective Income Tax Rate Reconciliation Table

The following reconciles the Company’s effective tax rate to the federal statutory rate (in thousands):


	Year Ended December 31,
	2015		2014		2013
Income tax per U.S. federal statutory rate (35%)	$	30,062	$	35,161	$	32,224
State income taxes, net of federal deduction		1,603		1,525		210
Change in valuation allowances		3,923		256		3,266
Foreign income taxes at different rates than the U.S.		(14,490)		(17,824)		(20,529)
Foreign withholding taxes		958		257		2,504
Losses in international markets without tax benefits		1,999		1,649		779
Nondeductible compensation under Section 162(m)		512		817		1,847
Liabilities for uncertain tax positions		1,756		1,435		77
Permanent difference related to foreign exchange gains		162		(11)		(122)
(Income) losses of foreign branch operations		(517)		225		1,447
Non-taxable earnings of noncontrolling interest		(1,349)		(1,141)		(1,172)
Foreign dividend less foreign tax credits		(4,425)		(1,428)		(2,587)
Increase in deferred tax liability - branch losses in UK		(2,530)		(75)		(954)
Decrease (increase) to deferred tax asset - change in tax rate		(526)		(443)		(68)
State income tax credits and net operating losses		(1,477)		(142)		615
Foreign earnings taxed currently in U.S.		2,839		2,696		2,907
Other		1,504		85		154
Income tax per effective tax rate	$	20,004	$	23,042	$	20,598

Schedule of Deferred Tax Assets and Liabilities

The Company’s deferred income tax assets and liabilities are summarized as follows (in thousands):


	Year Ended December 31,
	2015		2014
Deferred tax assets, gross
Accrued workers compensation, deferred compensation and employee benefits	$	10,509	$	17,030
Allowance for doubtful accounts, insurance and other accruals		4,860		4,554
Amortization of deferred rent liabilities		2,500		2,201
Net operating losses		19,522		11,296
Equity compensation		3,505		2,997
Customer acquisition and deferred revenue accruals		16,610		16,241
Federal and state tax credits, net		10,057		10,621
Depreciation and amortization		6,265		—
Unrealized losses on derivatives		16,644		11,686
Other		2,655		12,749
Total deferred tax assets, gross		93,127		89,375
Valuation allowances		(10,139)		(10,721)
Total deferred tax assets, net		82,988		78,654
Deferred tax liabilities
Depreciation and amortization		—		(7,035)
Contract acquisition costs		(25,667)		(11,768)
Future losses in UK		—		(2,530)
Intangible assets		(6,082)		(7,628)
Other		(2,490)		(355)
Total deferred tax liabilities		(34,239)		(29,316)
Net deferred tax assets	$	48,749	$	49,338

Valuation Allowance Rollforward

Activity in the Company’s valuation allowance accounts consists of the following (in thousands):


	Year Ended December 31,
	2015		2014		2013
Beginning balance	$	10,721	$	10,792	$	20,909
Additions of deferred income tax expense		4,300		946		4,218
Reductions of deferred income tax expense		(4,882)		(1,017)		(14,335)
Ending balance	$	10,139	$	10,721	$	10,792

Expiration of Net Operating Loss Carryforwards

As of December 31, 2015, after consideration of all tax loss and tax credit carry back opportunities, the Company had tax affected tax loss carry forwards worldwide expiring as follows (in thousands):


2016	$	1,616
2017		133
2018		316
2019		295
After 2019		12,688
No expiration		4,473
Total	$	19,521

Reserve for Uncertain Tax Positions Rollforward

The tabular reconciliation of the reserve for uncertain tax benefits on a gross basis without interest for the three years ended December 31, 2015 is presented below (in thousands):


Balance as of December 31, 2012	$	358
Additions for current year tax positions		—
Reductions in prior year tax positions		—
Balance as of December 31, 2013		358
Additions for current year tax positions		1,303
Reductions in prior year tax positions		—
Balance as of December 31, 2014		1,661
Additions for current year tax positions		1,048
Reductions in prior year tax positions		—
Balance as of December 31, 2015	$	2,709

Jurisdictions Open to Income Tax Examination

The following table presents the major tax jurisdictions and tax years that are open as of December 31, 2015 and subject to examination by the respective tax authorities:


Tax Jurisdiction		Tax Year Ended
United States		2012 to present
Argentina		2010 to present
Australia		2011 to present
Brazil		2010 to present
Canada		2008 to present
Mexico		2010 to present
Philippines		2013 to present
Spain		2011 to present