9. Income Taxes

The income tax (provision) benefit in continuing operations for fiscal 2013, fiscal 2012 and fiscal 2011 is summarized as follows:

	For the Fiscal Years Ended,

	Nov. 30, 2013			Dec. 1, 2012			Dec. 3, 2011
Current federal	$	—		$	—		$	—
Current state and local		—			—			(113	)
Deferred federal		(1,076	)		(172	)		648
Deferred state and local		84			(98	)		(252	)


Total income tax (provision) benefit	$	(992	)	$	(270	)	$	283

Griffin did not recognize a current tax benefit in fiscal 2013, fiscal 2012 or fiscal 2011 from the exercise of employee stock options. A benefit was not recorded in fiscal 2012 because Griffin utilized net operating loss carryforwards to offset taxable income. In fiscal 2013 and fiscal 2011, Griffin did not have taxable income. As of November 30, 2013, Griffin has an unrecognized tax benefit of $1,166 for the effect of employee stock options exercised in fiscal years 2006 through 2013. In fiscal 2012, the deferred tax asset related to non-qualified stock options was reduced by $38 as a result of exercises and forfeitures of those options. There were no adjustments to deferred tax assets for exercises and forfeitures of non-qualified stock options in fiscal 2013 and fiscal 2011.

Included in the loss from Griffin's discontinued operations are income tax benefits of $4,411 and $528 for fiscal 2013 and fiscal 2011, respectively. Included in the income of Griffin's discontinued operations is income tax expense of $1,077 for fiscal 2012.

The income tax (provision) benefit for discontinued operations in fiscal 2013, fiscal 2012 and fiscal 2011 is net of the effect of recording valuation allowances on certain state deferred tax assets for state net operating losses of Imperial. The effect on the income tax provision for the valuation allowances in fiscal 2013 and fiscal 2012 were charges of $93 and $44, respectively, less federal income tax benefits of $33 and $15, respectively. The effect on the income tax benefit for the valuation allowance in fiscal 2011 was a credit of $23, less federal income tax expense of $8. The establishment of the valuation allowances reflects management's determination that it is more likely than not that Imperial will not generate sufficient taxable income in the future to fully utilize certain state net operating loss carryforwards.

Other comprehensive (loss) income includes deferred tax (expense) benefit as follows:

	For the Fiscal Years Ended,

	Nov. 30, 2013			Dec. 1, 2012			Dec. 3, 2011
Mark to market adjustment on Centaur Media plc	$	213		$	(427	)	$	735
Measurement of the funded status of the defined postretirement plan		(40	)		29			21
Fair value adjustment of Griffin's cash flow hedges		(359	)		287			346


Total income tax (expense) benefit included in other comprehensive (loss) income	$	(186	)	$	(111	)	$	1,102

The differences between the income tax benefit at the United States statutory income tax rates and the actual income tax benefit on continuing operations for fiscal 2013, fiscal 2012 and fiscal 2011 are as follows:

	For the Fiscal Years Ended,

	Nov. 30, 2013			Dec. 1, 2012			Dec. 3, 2011
Tax (provision) benefit at statutory rate	$	(1,016	)	$	(163	)	$	557
State and local taxes, including valuation allowance, net of federal tax effect		55			(64	)		(237	)
Permanent items		(39	)		(50	)		(47	)
Other		8			7			10


Total income tax (provision) benefit	$	(992	)	$	(270	)	$	283

The state and local income tax expense, net of federal tax effect, principally reflects deferred tax expense due to the variations in income apportionment among Griffin's multiple state filings.

The significant components of Griffin's deferred tax assets and deferred tax liabilities are as follows:

	Nov. 30, 2013			Dec. 1, 2012

Deferred tax assets:
Inventories	$	4,397		$	371
Federal net operating loss carryforwards		1,507			521
Retirement benefit plans		1,500			1,222
State net operating loss carryforwards		937			855
Cash flow hedges		821			1,180
Non-qualified stock options		733			608
Deferred revenue		485			710
Charitable contributions		243			154
Conditional asset retirement obligations		114			117
Allowance for doubtful accounts receivable		52			50
Investment in Centaur Media plc		45			310
Investment in Shemin Nurseries Holding Corp.		—			301
Other		372			194


Total deferred tax assets		11,206			6,593
Valuation allowances		(379	)		(319	)


Net deferred tax assets		10,827			6,274


Deferred tax liabilities:
Real estate assets		(3,272	)		(2,211	)
Deferred rent		(926	)		(787	)
Prepaid insurance		(180	)		(147	)
Property and equipment		(104	)		(105	)
Other		(370	)		(277	)


Total deferred tax liabilities		(4,852	)		(3,527	)


Net total deferred tax assets	$	5,975		$	2,747

Deferred income taxes on Griffin's consolidated balance sheets at November 30, 2013 and December 1, 2012 are classified as follows:

	November 30, 2013									December 1, 2012

	Current			Noncurrent			Total			Current			Noncurrent			Total
Asset	$	4,508		$	6,319		$	10,827		$	722		$	5,552		$	6,274
Liability		(277	)		(4,575	)		(4,852	)		(197	)		(3,330	)		(3,527	)


	$	4,231		$	1,744		$	5,975		$	525		$	2,222		$	2,747

At November 30, 2013, Griffin had federal net operating loss carryforwards of approximately $4,305 with expirations ranging from seventeen to twenty years. At November 30, 2013, Griffin had state net operating loss carryforwards of approximately $22,819, principally in Connecticut, with expirations ranging from nine to twenty years. Management has determined that a valuation allowance is required for net operating loss carryforwards in certain states (other than Connecticut) related to Imperial. Realization of the tax benefits related to the Connecticut state net operating loss carryforwards, which are not subject to valuation allowances, and the state effective tax rates at which those benefits will be realized is dependent upon future results of operations. Differences between forecasted and actual future operating results could adversely impact Griffin's ability to realize tax benefits from Connecticut state net operating losses. Therefore, the deferred tax assets relating to Connecticut state net operating loss carryforwards could be reduced in the future if estimates of future taxable income are reduced. Griffin has evaluated the likelihood that it will realize the benefits of its deferred tax assets. Based on a significant amount of appreciated assets, primarily real estate, held by Griffin and the significant length of time expected before Griffin's deferred tax assets would expire, Griffin believes that it is more likely than not that it will utilize the benefit of its deferred tax assets.

Griffin evaluates each tax position taken in its tax returns and recognizes a liability for any tax position deemed less likely than not to be sustained under examination by the relevant taxing authorities. Griffin believes that its income tax filing positions will be sustained on examination and does not anticipate any adjustments that would result in a material change on its financial statements. As a result, no accrual for uncertain income tax positions has been recorded pursuant to FASB ASC 740-10.

Griffin's federal income tax return for fiscal 2009 was examined by the Internal Revenue Service and accepted as filed. Federal income tax returns for fiscal 2010, fiscal 2011 and fiscal 2012 are subject to examination by the Internal Revenue Service. Examinations of Griffin's fiscal 2007, fiscal 2008 and fiscal 2009 New York state income tax returns are currently being performed. In fiscal 2012, the state of Connecticut completed an examination of Griffin's fiscal 2007 tax return. There were no significant adjustments made as a result of that examination. The remaining periods subject to examination for Griffin's significant state return, which is Connecticut, are fiscal 2008 through fiscal 2012.