INCOME TAXES - Note 7	3 Months Ended
Jun. 30, 2017
Notes to Financial Statements
INCOME TAXES - Note 7	7. INCOME TAXES The Company's effective tax rate was 36.3% and negative 7.5% for the three months ended June 30, 2017 and 2016, respectively. The effective tax rate is calculated by dividing the income tax provision by net income before income tax expense. The difference in the effective tax rate and the U.S. federal statutory rate of 34% in both periods was due primarily to the change in pretax profitability, geographic mix of profits and losses, and adoption of new accounting guidance effective April 1, 2017. As described in Note 1, the Company adopted the updated accounting standard for share-based payment accounting in the three months ended June 30, 2017. As a result, the Company recorded deferred tax assets of approximately $17.6 million with a corresponding increase to retained earnings related to previously unrecognized excess tax benefits. For the three months ended June 30, 2017, the Company recognized approximately $0.4 million of excess tax benefits within the provision for income taxes. Additionally, the Company elected to prospectively apply the change in presentation of excess tax benefits as an operating activity on the statement of cash flows rather than as a financing activity. Accordingly, prior period classification of cash flows related to excess tax benefits were not adjusted.

INCOME TAXES - Note 7

3 Months Ended

Jun. 30, 2017

7. INCOME TAXES

The Company's effective tax rate was 36.3% and negative 7.5% for the three months ended June 30, 2017 and 2016, respectively. The effective tax rate is calculated by dividing the income tax provision by net income before income tax expense. The difference in the effective tax rate and the U.S. federal statutory rate of 34% in both periods was due primarily to the change in pretax profitability, geographic mix of profits and losses, and adoption of new accounting guidance effective April 1, 2017.

As described in Note 1, the Company adopted the updated accounting standard for share-based payment accounting in the three months ended June 30, 2017. As a result, the Company recorded deferred tax assets of approximately $17.6 million with a corresponding increase to retained earnings related to previously unrecognized excess tax benefits. For the three months ended June 30, 2017, the Company recognized approximately $0.4 million of excess tax benefits within the provision for income taxes. Additionally, the Company elected to prospectively apply the change in presentation of excess tax benefits as an operating activity on the statement of cash flows rather than as a financing activity. Accordingly, prior period classification of cash flows related to excess tax benefits were not adjusted.