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INCOME TAXES (Tables)

12 Months Ended

Aug. 31, 2012

Income from continuing operations before provision for income taxes and loss of unconsolidated affiliates

Income from continuing operations before provision for income taxes and loss of unconsolidated affiliates includes the following components (in thousands):



	Years Ended August 31,
	2012		2011		2010
United States	$	38,121	$	24,259	$	17,390
Foreign	64,593		65,097		54,850
Income from continuing operations before provision for income taxes and loss of unconsolidated affiliates	$	102,714	$	89,356	$	72,240

Significant components of income tax provision

Significant components of the income tax provision are as follows (in thousands):



	Years Ended August 31,
	2012			2011		2010
Current:
U.S.	$	7,593		$	4,905	$	3,540
Foreign	26,325			21,170		15,054
Total	$	33,918		$	26,075	$	18,594
Deferred:
U.S.	$	1,853		$	375	$	2,973
Foreign	(1,031		)	146		1,870
Valuation allowance charge (release)	313			872		(650		)
Total	$	1,135		$	1,393	$	4,193
Provision for income taxes	$	35,053		$	27,468	$	22,787

Reconciliation of income tax rate

The reconciliation of income tax computed at the Federal statutory tax rate to the provision for income taxes is as follows (in percentages):



	Years Ended August 31,
	2012		2011		2010
Federal tax provision at statutory rates	35.0	%	35.0	%	34.0	%
State taxes, net of federal benefit	0.3		0.8		0.5
Differences in foreign tax rates	(3.6	)	(3.7	)	(3.5	)
Permanent items and other adjustments	2.1		(2.4	)	1.4
Increase (decrease) in Foreign valuation allowance	0.3		1.0		(0.9	)
Provision for income taxes	34.1	%	30.7	%	31.5	%

Significant components of deferred tax assets

Significant components of the Company’s deferred tax assets as of August 31, 2012 and 2011 are shown below (in thousands):



	August 31,
	2012			2011			2010
Deferred tax assets:
U.S. net operating loss carryforward	$	8,800		$	8,953		$	9,688
U.S. capital loss carryforward	—			—			4,318
U.S. timing differences and alternative minimum tax credits	202			295			1,787
Deferred compensation	1,835			683			921
Foreign tax credits	1,568			3,569			4,944
Foreign deferred taxes net operating losses	8,066			8,662			7,967
Foreign deferred taxes other timing differences	9,048			6,759			6,297
Total deferred tax assets	29,519			28,921			35,922
U.S. valuation allowance	(697		)	(8		)	(8,350		)
Foreign valuation allowance	(8,368		)	(7,661		)	(7,296		)
Net deferred tax assets	$	20,454		$	21,252		$	20,276

Reconciliation of unrecognized tax benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):



	2012			2011			2010
Balance at beginning of fiscal year	$	13,528		$	13,615		$	13,851
Additions based on tax positions related to the current year	575			1,130			429
Reductions for tax positions of prior years	—			—			(166		)
Settlements	(591		)	(643		)	(21		)
Expiration of the statute of limitations for the assessment of taxes	(2,300		)	(574		)	(478		)
Balance at end of fiscal year	$	11,212		$	13,528		$	13,615

Summary of income tax examinations

The Company is generally no longer subject to income tax examinations by tax authorities in its major jurisdictions except for the fiscal years subject to audit as set forth in the table below:



Tax Jurisdiction	Fiscal Years Subject to Audit
U.S. federal	1998, 2000 to 2005, 2009 to the present
California (U.S.) (state return)	2004 to 2005 and 2007 to the present
Florida(U.S.) (state return)	2002 to 2005, 2007 and 2009 to the present
Aruba	2012
Barbados	2006 to the present
Costa Rica	2009 to the present
Colombia	2010 to the present
Dominican Republic	2007 and 2009 to the present
El Salvador	2009 to the present
Guatemala	2008 to the present
Honduras	2007 to the present
Jamaica	2006 to the present
Mexico	2007 to the present
Nicaragua	2008 to the present
Panama	2009 to the present
Trinidad	2004 to the present
U.S. Virgin Islands	2001 to the present

- 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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- Definition

Tabular disclosure of income tax examinations that an enterprise is currently subject to or that have been completed in the current period typically including a description of the examination, the jurisdiction conducting the examination, the tax year(s) under examination, the likelihood of an unfavorable settlement, the range of possible losses, the liability recorded, the increase or decrease in the liability from the prior period, and any penalties and interest that have been recorded.

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