Company: KEQU
Filing Date: 2025-03-14
Form Type: 10-Q
Source: 0000055529-25-000013
Chunk: 61

Company: KEWAUNEE SCIENTIFIC CORP /DE/
Filing Date: 2025-03-14
Form: 10-Q
Item: Part I, Item 8
Chunk 61
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 January 31, 2024, respectively. The prior year effective tax rate was influenced by foreign operations which are taxed at different rates than the U.S. tax rate of 21%, combined with expected tax expense for the Company's domestic operations and estimated increases in the domestic valuation allowance required for the corresponding period. In addition, income tax expense for the nine months ended January 31, 2024 was unfavorably impacted by additional foreign tax expense of $387,000 related to India tax matters. This one-time expense was related to management's decision to discontinue management fees, citing challenges associated with the Indian tax authority and cost benefit analysis.

In August 2019, the Company revoked its indefinite reinvestment of foreign unremitted earnings position in compliance with ASC 740 "Income Taxes" and terminated its indefinite reinvestment of unremitted earnings assertion for the Singapore and Kewaunee Labway India Pvt. Ltd. international subsidiaries. The Company has a deferred tax liability of $1,431,000 and $1,572,000 for the withholding tax related to Kewaunee Labway India Pvt. Ltd. as of January 31, 2025 and April 30, 2024, respectively. 

O. Defined Benefit Pension Plans

During the year ended April 30, 2024, the Company settled its non-contributory defined benefit plans by transferring approximately $17.8 million of pension obligations through the purchase of group annuity contracts for all remaining liabilities under the pension plan. In connection with the transfer, the Company contributed $287,000 in cash to the pension plans, which was intended to fully fund the Company’s remaining defined benefit pension liabilities. These non-contributory defined benefit pension plans, which covered some domestic employees, were amended as of April 30, 2005. Following this amendment, no further benefits have been earned under the plans, and no additional participants have been added. The defined benefit plan for salaried employees provides pension benefits that are based on each employee's years of service and average annual compensation during the last ten consecutive calendar years of employment as of April 30, 2005. The benefit plan for hourly employees provides benefits at stated amounts based on years of service as of April 30, 2005.There were no Company contributions paid to the plans for the three and nine months ended January 31, 2024. The Company assumed an expected long-term rate of return of 7.75% for the period ended January 31,