Income Tax Provision

9 Months Ended

Sep. 30, 2011

Income Tax Provision

Income Tax Provision

NOTE 11 — INCOME TAX PROVISION

During the three months and nine months ended September 30, 2011, the provision for income taxes decreased to $2.9 million and $10.3 million, respectively from $5.8 million and $22.2 million in the comparable periods in 2010. The effective income tax rate for the three months and nine months ended September 30, 2011 was approximately 12.0% and 24.8%, respectively, as compared to 16.9% and 26.5% for the three months and nine months ended September 30, 2010, respectively. The change in the provision for income taxes and the effective income tax rate is primarily a result of the mix of pre-tax income between high and low tax jurisdictions, and other discrete items impacting the quarter ended September 30, 2011. Discrete items primarily include a decrease related to release of a valuation allowance against U.K. foreign deferred tax assets and decreases due to release of reserves from the expiration of the U.S. federal income tax statute for the fiscal year 2007 and closure of the Canada Revenue Agency income tax audit for the fiscal years 2006 through 2007, as recorded during the three months ended September 30, 2011.

During the first quarter of 2011, we received examination notices from the Internal Revenue Service and the California Franchise Tax Board to audit income tax returns filed for calendar years 2008 through 2009, and 2007 through 2008, respectively.