INCOME TAXES (Tables)

12 Months Ended

Jun. 02, 2018

Income Tax Disclosure [Abstract]

Schedule of income before income tax, domestic and foreign

Income (loss) from continuing operations before income taxes included the following components (in thousands): 

	Fiscal Year Ended
	June 2,  2018			May 27,  2017			May 28,  2016
United States	$	(211	)	$	(8,150	)	$	(7,274	)
Foreign		4,071			2,034			1,054
Income (loss) before income taxes	$	3,860		$	(6,116	)	$	(6,220	)

Schedule of components of income tax expense (benefit)

The provision for income taxes for fiscal 2018, 2017 and 2016 consisted of the following (in thousands): 

	Fiscal Year Ended
	June 2,  2018			May 27,  2017			May 28,  2016
Current:
Federal	$	—		$	(117	)	$	—
State		(12	)		3			17
Foreign		1,220			1,035			441
Total current	$	1,208		$	921		$	458
Deferred:
Federal	$	124		$	—		$	—
State		—			—			—
Foreign		202			(109	)		88
Total deferred	$	326		$	(109	)	$	88
Income tax provision	$	1,534		$	812		$	546

Schedule of effective income tax rate reconciliation

The differences between income taxes at the U.S. federal statutory income tax rate of 29.2% for fiscal 2018 and 34% for fiscal 2017 and 2016 and the reported income tax provision for fiscal 2018, 2017 and 2016 are summarized as follows:

	Fiscal Year Ended
	June 2,  2018			May 27, 2017			May 28,  2016
Federal statutory rate		29.2	%		34.0	%		34.0	%
Effect of:
State income taxes, net of federal tax benefit		0.3			4.8			4.2
Deemed repatriation tax		(50.0	)		—			—
Foreign income inclusion		—			(20.7	)		(0.4	)
Foreign taxes at other rates		(0.1	)		1.0			0.6
Permanent tax differences		6.7			(0.5	)		(0.8	)
Deferred remeasurement		45.1			—			—
Tax reserves		3.6			0.9			(6.0	)
Additional U.S. tax on undistributed foreign earnings		(12.5	)		15.8			(32.7	)
Change in valuation allowance for deferred tax assets		15.1			(46.6	)		(11.4	)
Return to provision adjustments		0.1			(2.0	)		3.9
Closure of foreign audits		2.2			—			—
Other		—			—			(0.2	)
Effective tax rate		39.7	%		(13.3	)%		(8.8	)%

Schedule of deferred tax assets and liabilities

Our deferred tax assets and liabilities reflect continuing operations as of June 2, 2018 and May 27, 2017. Significant components were as follows (in thousands):

	Fiscal Year Ended
	June 2,			May 27,
	2018			2017
Deferred tax assets:
NOL carryforwards - foreign and domestic	$	7,883		$	7,870
Inventory valuations		978			1,141
Goodwill		294			325
Foreign tax credits		465			3,808
Severance reserve		119			227
Foreign capital loss		1,143			1,142
Other		1,632			2,048
Subtotal	$	12,514		$	16,561
Valuation allowance - foreign and domestic		(9,148	)		(8,557	)
Net deferred tax assets after valuation allowance	$	3,366		$	8,004
Deferred tax liabilities:
Accelerated depreciation	$	(2,474	)	$	(1,356	)
Tax on undistributed earnings		(274	)		(5,738	)
Other		28			35
Subtotal	$	(2,720	)	$	(7,059	)
Net deferred tax assets	$	646		$	945
Supplemental disclosure of deferred tax assets (liabilities) information:
Domestic	$	7,394		$	6,937
Foreign	$	2,401		$	2,565
Total	$	9,795		$	9,502

Schedule of unrecognized tax benefits

The following table summarizes the activity related to the unrecognized tax benefits (in thousands):

	Fiscal Year Ended
	June 2,  2018			May 27,  2017
Unrecognized tax benefits, beginning of period	$	1,883		$	2,000
Increase in positions taken in prior period		138			75
Decrease in positions due to settlements		(1,883	)		(75	)
Decrease related to the expiration of statute of limitations		—			(117	)
Unrecognized tax benefits, end of period	$	138		$	1,883

Unrecognized tax benefits for continuing and discontinued operations were as follows (in thousands):

	Fiscal Year Ended
	June 2,  2018		May 27,  2017
Continuing operations	$	138	$	—
Discontinued operations(1)		—		1,883
	$	138	$	1,883

(1) Relates to an amended Illinois state income tax return related to the sale of RFPD.