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INCOME TAXES
3 Months Ended
Mar. 31, 2012
Income Tax Disclosure [Abstract]  
INCOME TAXES
INCOME TAXES
The effective tax rate continues to be lower than the United States statutory rate of 35 percent primarily due to the indefinite reinvestment of foreign earnings taxed at rates below the U.S. statutory rate as well as recognition of foreign tax credits.  The Company has the ability to indefinitely reinvest these foreign earnings based on the earnings and cash projections of its other operations as well as cash on hand and available credit.

As of the beginning of fiscal year 2012, the Company had gross unrecognized tax benefits of $5.6 million, excluding accrued interest and penalties.  The unrecognized tax benefits decreased by $0.2 million for state income tax liabilities based on evaluations made during first quarter of 2012.  The Company had gross unrecognized tax benefits, excluding accrued interest and penalties, of $5.4 million as of March 31, 2012.

If recognized, the annual effective tax rate would be affected by the net unrecognized tax benefits of $5.1 million as of March 31, 2012.

Of the unrecognized tax benefits at March 31, 2012, $3.1 million are related to acquisitions for which indemnification was provided for in the respective purchase agreements.  The stock purchase agreements related to these acquisitions provide the Company with rights to recover tax liabilities related to pre-acquisition tax years from the sellers.  Other amounts are associated with domestic state tax issues, such as nexus, as well as other federal and state uncertain tax positions.

The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense, the impact of which is immaterial.  The Company has accrued interest and penalties as of March 31, 2012 and December 31, 2011, of approximately $0.5 million, respectively.

The Company is subject to taxation in the United States and various state and foreign jurisdictions. With few exceptions, as of March 31, 2012, the Company is no longer subject to U.S. federal, state, or foreign income tax examinations by tax authorities for years before 2008.

It is reasonably possible that the amounts of unrecognized tax benefits could change in the next twelve months as a result of an audit or due to the future expiration of a statute of limitation. Based on the current audits in process and pending statute expirations, the payment of taxes as a result could be up to $1.2 million.