Income Taxes (Tables)

12 Months Ended

Jun. 30, 2023

Schedule of Components of Income Tax Expense

The income tax expense for the fiscal years ended June 30, 2023 and 2022 consists of the following (in thousands):


	Year ended June 30,
	2023		2022
Income Before Income Taxes:
Domestic	$	2,464	$	1,613
International	1,535		3,078
	$	3,999	$	4,691
Current Taxes:
Federal	$	2,012	$	255
State	436		237
Foreign	686		1,195
Total Current Income Tax Provision	$	3,134	$	1,687
Deferred Taxes:
Federal	$	(1,400)	$	(391)
State	(303)		(43)
Foreign	28		318
Total Deferred Income Tax Provision	$	(1,675)	$	(116)
Net Income Tax Provision	$	1,459	$	1,571

Schedule of The Effective Income Tax Rate Differs from the U.S. Federal Statutory Income Tax Rate

The effective income tax rate for the fiscal years ended June 30, 2023 and 2022 differs from the U.S. Federal statutory income tax rate due to the following:


	Year ended June 30,
	2023		2022
Federal statutory income tax rate	21.0	%	21.0	%
State income taxes, net of federal benefit	0.8	%	0.1	%
Foreign tax rate difference	8.3	%	12.9	%
Tax return to provision true-up	3.2	%	(4.3)	%
Limit on future stock compensation due to 162(m)	4.3	%	0.1	%
Foreign withholding tax	0.4	%	1.3	%
Other differences	(0.3)	%	1.0	%
Revalue of deferred for change in federal tax rate	0.1	%	0.1	%
Permanent differences:
— stock-based compensation	5.8	%	3.9	%

— foreign derived intangible income deduction	(5.8)	%	(6.5)	%

— tax credits	(5.3)	%	(16.0)	%
— meals and entertainment	0.8	%	0.1	%
— removal of permanent reinvestment assertion in Japan	0.3	%	4.6	%
— other permanent differences	2.1	%	2.2	%
Change in valuation allowance	0.7	%	13.1	%
Net income tax provision	36.5	%	33.5	%

Schedule of The Components of the Deferred Tax Assets and Liabilities

The components of the deferred tax assets and liabilities as of June 30, 2023 and 2022 are as follows (in thousands):


	June 30,
	2023		2022
Deferred tax assets:
Federal, state, and foreign net operating loss carryovers	$	250	$	292
Stock option compensation	549		232
Section 174 costs	955		—
Lease liability	3,100		3,388
Accrued vacation, allowance for returns, bonuses & other	3,005		2,780
Gross deferred tax asset	$	7,859	$	6,692

Deferred tax liabilities:
Patents and trademarks	$	(66)	$	(78)

Property & equipment	(1,571)		(1,996)
Right of use asset	(2,057)		(2,245)
Other	(470)		(409)
Gross deferred tax liabilities	(4,164)		(4,728)
Less: valuation allowance	(704)		(675)
Deferred tax assets, net	$	2,991	$	1,289

Summary of Valuation Allowance

The change in the valuation allowance were as follows (in thousands):


	Years ended June 30,
	2023		2022
Beginning balance	$	675	$	73
Increases	29		602
Ending balance	$	704	$	675