Quarterly report pursuant to Section 13 or 15(d)

Income Taxes

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Income Taxes
3 Months Ended
Feb. 02, 2014
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

Under ASC 270, “Interim Reporting,” and ASC 740-270, “Income Taxes – Intra Period Tax Allocation,” the Company is required to adjust its effective tax rate for each quarter to be consistent with the estimated annual effective tax rate. Jurisdictions with a projected loss for the full year where no tax benefit can be recognized are excluded from the calculation of the estimated annual effective tax rate.

The provision for income taxes consists of provisions for federal, state and foreign income taxes. Accordingly, the effective income tax rate is a composite rate reflecting the geographic mix of earnings in various tax jurisdictions and applicable rates. Our interim provision for income taxes is measured using an estimated annual effective tax rate, adjusted for discrete items that occur within the periods presented. Our future effective tax rates could be adversely affected by earnings being lower than anticipated in countries with lower statutory rates, greater losses than anticipated in countries with lower statutory tax rates, increases in recorded valuation allowances of tax assets, or changes in tax laws.

The provision for income taxes in the first quarter of fiscal 2014 was $1.0 million compared to $0.6 million in 2013. The Company’s cumulative results for substantially all United States domestic and certain non-United States jurisdictions for the most recent three-year period is a loss and includes significant restatement, investigation and remediation costs. Accordingly, a valuation allowance has been established for substantially all loss carryforwards and other net deferred tax assets for these jurisdictions, resulting in an effective tax rate that is significantly different than the statutory rate.