TAXES ON INCOME (Tables)

12 Months Ended

Dec. 30, 2012

Provisions for Federal Foreign and State Income Taxes

Provisions for federal, foreign and state income taxes in the consolidated statements of operations consisted of the following components:

	FISCAL YEAR
	2012			2011		2010
	(in thousands)
Current expense/(benefit):
Federal	$	(134	)	$	316	$	(62	)
Foreign		5,319			11,123		12,617
State		602			922		530
		5,787			12,361		13,085
Deferred expense/(benefit):
Federal		1,928			6,204		(9,510	)
Foreign		17			2,304		994
State		(1,692	)		14		(533	)
		253			8,522		(9,049	)
	$	6,040		$	20,883	$	4,036

Income Tax Expense (Benefit)

Income tax expense (benefit) is included in the accompanying consolidated statements of operations as follows:

	FISCAL YEAR
	2012			2011		2010
	(in thousands)
Continuing operations	$	15,204		$	20,640	$	4,616
Loss from discontinued operations		(9,164	)		243		(580	)
	$	6,040		$	20,883	$	4,036

Income (Loss) from Continuing Operations Before Taxes on Income

Income (loss) from continuing operations before taxes on income consisted of the following:

	FISCAL YEAR
	2012		2011		2010
	(in thousands)
U.S. operations	$	27,332	$	15,592	$	(31,921	)
Foreign operations		10,771		43,318		46,834
	$	38,103	$	58,910	$	14,913

Net Deferred Tax Asset

The sources of the temporary differences and their effect on the net deferred tax asset are as follows:

	2012					2011
	ASSETS			LIABILITIES		ASSETS			LIABILITIES
	(in thousands)
Basis differences of property and equipment	$	0		$	9,985	$	0		$	10,397
Basis difference of intangible assets		0			426		0			402
Foreign currency loss		0			3,217		0			2,888
Net operating loss carryforwards		55,322			0		41,429			0
Valuation allowances on net operating loss carryforwards		(4,603	)		0		(4,892	)		0
Federal tax credits		3,164			0		676			0
Deferred compensation		18,633			0		17,853			0
Basis difference of prepaids, accruals and reserves		10,894			0		8,919			0
Pensions		499			0		2,592			0
Tax effects of undistributed earnings from foreign subsidiaries not deemed to be indefinitely reinvested		0			4,810		0			4,585
Basis difference of other assets and liabilities		317			0		293			0
	$	84,226		$	18,438	$	66,870		$	18,272

Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities are included in the accompanying balance sheets as follows:

	FISCAL YEAR
	2012			2011
	(in thousands)
Deferred income taxes (current asset)	$	10,271		$	9,699
Deferred tax asset (non-current asset)		62,856			47,290
Deferred income taxes (non-current liabilities)		(7,339	)		(8,391	)
	$	65,788		$	48,598

Summary Reconciles Income Taxes

The following summary reconciles income taxes at the U.S. federal statutory rate of 35% to the Company’s actual income tax expense:

	FISCAL YEAR
	2012			2011			2010
	(in thousands)
Income taxes at U.S federal statutory rate	$	13,336		$	20,619		$	5,220
Increase (decrease) in taxes resulting from:
State income taxes, net of federal tax effect		1,116			940			(1,713	)
Non-deductible business expenses		1,009			373			354
Non-deductible employee compensation		469			587			399
Tax effects of Company owned life insurance		(448	)		283			(1,281	)
Tax effects of undistributed earnings from foreign subsidiaries not deemed to be indefinitely reinvested		321			774			960
Foreign and U.S. tax effects attributable to foreign operations		(1,174	)		(2,115	)		(491	)
Valuation allowance effect – State NOL		(187	)		(333	)		1,717
Non-deductible reserve against capital asset		1,188			0			0
Income attributable to noncontrolling interest in subsidiary		0			0			(368	)
Other		(426	)		(488	)		(181	)
Income tax expense	$	15,204		$	20,640		$	4,616

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:

	Fiscal Year
	2012			2011			2010
	(in thousands)
Balance at beginning of year	$	7,736		$	8,159		$	9,551
Increases related to tax positions taken during the current year		18,118			693			718
Increases related to tax positions taken during the prior years		150			250			538
Decreases related to tax positions taken during the prior years		(519	)		(1,237	)		0
Decreases related to settlements with taxing authorities		0			0			(1,778	)
Decreases related to lapse of applicable statute of limitations		(300	)		0			(712	)
Changes due to foreign currency translation		1			(129	)		(158	)
Balance at end of year	$	25,186		$	7,736		$	8,159