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Income Taxes
3 Months Ended
Jul. 27, 2013
Income Taxes

(10) Income Taxes

The Company recorded an income tax provision of $15.5 million on a pre-tax loss of $71.5 million during the 13 weeks ended July 27, 2013, which represented an effective income tax rate of (21.7)%. The Company recorded a $21.4 million tax benefit on pre-tax loss of $61.2 million during the 13 weeks ended July 28, 2012, which represented an effective income tax rate of 34.9%.

The income tax provision for the 13 weeks ended July 27, 2013 does not include income tax benefits on losses incurred by certain domestic operations because the Company recorded valuation allowances against the associated deferred assets. The income tax provision is principally comprised of the result of the activities of profitable jurisdictions and valuation allowances against certain deferred assets. The Company’s pre-tax income in profitable jurisdictions, where it records tax provisions, was lower than domestic losses where it maintains valuation allowances and do not record tax benefits, resulting in a negative effective income tax rate.

As of July 27, 2013, the Company had $31,460 of unrecognized tax benefits, all of which, if recognized, would affect the Company’s effective tax rate. The Company’s continuing practice is to recognize interest and penalties related to income tax matters in income tax expense. The Company had $6,593 accrued for interest and penalties, which is included in the $31,460 of unrecognized tax benefits noted above.

The Company is subject to U.S. federal income tax as well as income tax in jurisdictions of each state having an income tax. The Company’s income tax returns are subject to ongoing tax examinations in several jurisdictions in which it operates. The tax years that remain subject to examination are primarily 2007 and forward. Some earlier years remain open for a small minority of states.