Note 9.

Income Taxes

For the three months ended July 31, 2016 and 2015, our effective tax rates were 42.3% and 38.8%, respectively. During the three months ended July 31, 2016 as compared to the prior year period, our effective tax rate increased primarily due to the establishment of a valuation allowance against certain deferred tax assets on loss carry-forwards that would likely not be realized by the Mederi AG entity. These deferred tax assets associated with the Mederi AG entity were recorded as part of our acquisition of the Qforma CrowdLink business in March 2015. The effective tax rate increase was partially offset by the benefit of the reenactment of the U.S. research and development tax credit.

For the six months ended July 31, 2016 and 2015, our effective tax rates were 40.8% and 39.5%, respectively. During the six months ended July 31, 2016 as compared to the prior year period, our effective tax rate increased primarily due to the establishment of a valuation allowance against certain deferred tax assets on loss carry-forwards that would likely not be realized by the Mederi AG entity. These deferred tax assets associated with the Mederi AG entity were recorded as part of our acquisition of the Qforma CrowdLink business in March 2015. The effective tax rate increase was partially offset by the benefit of the reenactment of the U.S. research and development tax credit.