|6 Months Ended|
Mar. 31, 2016
|Income Taxes [Abstract]|
Note 10. Income Taxes
Income tax provisions for the Company's interim periods are based on the effective income tax rate expected to be applicable for the full year. The Company's effective tax rate for the six months ended March 31, 2016 was 29.1%, compared to 28.2% for the first half of fiscal 2015. The increase in the effective tax rate for the first six months of fiscal 2016 primarily reflected a relative decrease in foreign tax credits, as well as a decrease in manufacturing deductions for U.S. locations. Fiscal 2015 reflected the benefit of the utilization of certain tax attributes as a result of legal structure reorganization in foreign jurisdictions. The difference between the Company's fiscal 2016 second quarter effective tax rate and the Federal statutory rate of 35.0% primarily reflected the impact of state taxes, offset by lower foreign income taxes.
The Company had unrecognized tax benefits (excluding penalties and interest) of $3,781 and $4,086 on March 31, 2016 and September 30, 2015, respectively, all of which, if recorded, would impact the 2016 annual effective tax rate.
The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes. Total penalties and interest accrued were $1,994 and $2,010 at March 31, 2016 and September 30, 2015, respectively. These accruals may potentially be applicable in the event of an unfavorable outcome of uncertain tax positions.
The Company is currently under examination in several tax jurisdictions and remains subject to examination until the statute of limitations expires for those tax jurisdictions. As of March 31, 2016, the tax years that remain subject to examination by major jurisdiction generally are:
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/presentationRef