Income Taxes

12 Months Ended

Sep. 30, 2011

Income Taxes [Abstract]

Income Taxes

8. Income Taxes

The components of income before income tax provision are as follows:

	Years Ended September 30,
	2011		2010
U.S	$	10,388	$	8,045
Non-U.S		850		349
Income before income tax provision	$	11,238	$	8,394

The income tax provision consists of the following:

	Years Ended September 30,
	2011			2010
Current income tax provision:
U.S. federal	$	2,486		$	1,967
U.S. state and local		463			320
Non-U.S		162			103
Total current tax provision		3,111			2,390
Deferred income tax provision (benefit):
U.S. federal		627			582
U.S. state and local		(62	)		84
Non-U.S		113			(24	)
Total deferred tax provision		678			642
Income tax provision	$	3,789		$	3,032

The income tax provision differs from amounts currently payable or refundable due to certain items reported for financial statement purposes in periods that differ from those in which they are reported for tax purposes. The income tax provision in the accompanying consolidated statements of operations differs from amounts determined by using the statutory rate as follows:

	Years Ended September 30,
	2011			2010
Income before income tax provision	$	11,238		$	8,394
Less-U.S. state and local income tax provision		401			404
Income before U.S. and non-U.S. federal income tax provision	$	10,837		$	7,990
Income tax provision at U.S. federal statutory rates	$	3,693		$	2,716
Tax effect of:
Business expenses (deductible) not deductible for tax		(208	)		13
Undistributed earnings of non-U.S. subsidiaries		132			(18	)
State and local income taxes		401			412
Federal tax credits		(289	)		0
Other		60			(91	)
Income tax provision	$	3,789		$	3,032

Deferred tax assets and liabilities at September 30 consist of the following:

	2011			2010
Deferred tax assets:
Net non-U.S. operating loss carryforwards	$	592		$	645
Employee benefits		2,910			2,331
Inventory reserves		641			614
Asset impairment reserve		435			352
Allowance for doubtful accounts		190			158
Foreign tax credits		3,221			3,099
Other		149			148
Total deferred tax assets		8,138			7,347
Deferred tax liabilities:
Depreciation		(3,336	)		(2,810	)
Unremitted foreign earnings		(5,083	)		(4,839	)
Other		0			(91	)
Total deferred tax liabilities		(8,419	)		(7,740	)
Net deferred tax liabilities		(281	)		(393	)
Valuation allowance		(452	)		(464	)
Net deferred tax liabilities	$	(733	)	$	(857	)

At September 30, 2011, the Company has a non-U.S. tax loss carryforward of approximately $5,458, which relates to the Company's Irish subsidiary that ceased operations in 2007. A valuation allowance has been recorded against the deferred tax asset related to this non-U.S. tax loss carryforward because it is unlikely that such operating loss can be utilized unless the Irish subsidiary resumed operations. The non-U.S. tax loss carryforward does not expire.

The Company recognized reductions of the valuation allowance against its net deferred tax assets in fiscal years 2011 and 2010 of $12 and $3, respectively.

Cumulative undistributed earnings of non-U.S. subsidiaries for which no U.S. deferred federal income tax liabilities have been established were approximately $1,968 at September 30, 2011. The incremental U.S. federal income tax related to any repatriation of these cumulative foreign earnings is indeterminable currently. The incremental foreign withholding taxes associated with a repatriation of all such earnings would approximate $54.

The Company reported liabilities for uncertain tax positions, which includes any related interest and penalties, in fiscal 2011 and 2010 of $96 and $63, respectively. During fiscal 2011, the Company recognized a nominal amount for interest and no amount for penalties. Based on the statute of limitations for specific jurisdictions, the related unrecognized tax benefit for positions previously taken may change in the next 12 months by approximately $27, which would be recorded through income tax expense. The Company classifies interest and penalties on uncertain tax positions as income tax expense. A summary of activity related to the Company's uncertain tax position is as follows:

	2011			2010
Balance at beginning of year	$	63		$	58
Increase due to tax positions taken in current year		46			5
Increase due to tax positions taken in prior years		14			0
Lapse of statute of limitations		(27	)		0
Balance at end of year	$	96		$	63

The Company is subject to income taxes in the U.S. federal jurisdiction, and various state, local and non-U.S. jurisdictions. In 2010, the Internal Revenue Service completed an audit of the Company's federal income tax return for fiscal 2007, the outcome of which resulted in $92 of additional taxes being owed by the Company. The Company is no longer subject to U.S. federal, state and local or non-U.S. income tax examinations for the years prior to fiscal year 2006.