Income Tax Expense

9 Months Ended

Jun. 30, 2011

Income Tax Expense

Income Tax Expense

9.     INCOME TAX EXPENSE

The third quarter 2011 effective income tax rate was 35.3% compared to 37.3% in the third quarter of 2010.  The income tax expense in the third quarter of 2010 was unfavorably impacted by a $0.3 million adjustment, net, related to fiscal year 2009 research credits, increasing the third quarter 2010 effective tax rate by 1.4%.  The effective income tax rate in the first nine months of fiscal 2011 and 2010 was 35.0% compared to 36.6% in the prior year period.  The income tax expense in the first nine months of 2011 was favorably impacted by net research tax credits of $0.4 million, reducing the rate for the first nine months of 2011 by 0.8%, as a result of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.  The income tax expense in the first nine months of 2010 was unfavorably impacted by the $0.3 million adjustment discussed above, increasing the rate for the first nine months of 2010 by 1.0%.  The Company estimates the annual effective income tax rate for fiscal 2011 will be approximately 36.0%.

There was no material change in the unrecognized tax benefits of the Company during the three-month period ended June 30, 2011.  The Company anticipates a $2.0 million reduction in the amount of unrecognized tax benefits in the next twelve months as a result of a lapse of the applicable statute of limitations.