XML 55 R12.htm IDEA: XBRL DOCUMENT v2.4.0.6
Income Taxes
6 Months Ended
Jun. 30, 2012
Income Taxes [Abstract]  
Income Taxes

NOTE 4.  Income Taxes

 

The Company follows FASB ASC Topic 740, “Income Taxes,” which prescribes a threshold for the financial statement recognition of income taxes and provides criteria for the measurement of tax positions taken or expected to be taken in a tax return.  ASC 740 also includes guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition of income taxes.  

 

For the quarter ended June 30, 2012, the Company reported income tax expense of $518 thousand for an effective tax rate of 34.7 percent, compared to an income tax expense of $277 thousand and effective tax rate of 30.1 percent for the prior year’s quarter.  For the six months ended June 30, 2012, the Company reported income tax expense of $977 thousand for an effective tax rate of 34.2 percent, compared to an income tax expense of $129 thousand and effective tax rate of 13.0 percent for the six months ended June 30, 2011.  The provision for income taxes for the six months ended June 30, 2011 included the reversal of $150 thousand of a valuation reserve for deferred taxes related to the net operating loss carry-forward deferred tax asset.  Excluding this valuation adjustment, our effective tax rate would have been 28.1 percent.

 

The Company did not recognize or accrue any interest or penalties related to income taxes during the six months ended June 30, 2012 or 2011.  The Company does not have an accrual for uncertain tax positions as of June 30, 2012 or December 31, 2011, as deductions taken and benefits accrued are based on widely understood administrative practices and procedures and are based on clear and unambiguous tax law.  Tax returns for all years 2008 and thereafter are subject to future examination by tax authorities.