Income Taxes (Tables)

Income tax expense for the year is as follows:


Year ended	March 31,
	2025	2024
Current tax expense:	$	$

Current tax expense for the year	1,276	317

Deferred tax recovery:

Origination and reversal of temporary differences	1,499	(256)
Total deferred tax expense (recovery)	1,499	(256)
Total income tax expense	2,775	61

The Company’s effective income tax rate differs from the combined statutory tax rate as follows:


Year ended	March 31,
	2025		2024
	%	$	%	$
Earnings (loss) before income taxes		4,070		(16,599)
Company's statutory tax rate	26.5	1,079	26.5	(4,399)
Non-deductible share-based compensation expense	24.6	1,000	(6.7)	1,113
Other non-deductible and tax exempt items	(39.2)	(1,595)	3.0	(496)
Change in unrecognized deferred tax assets	21.2	863	(21.7)	3,600
Impairment of goodwill	32.7	1,332	—	—
Other	2.4	96	(1.5)	243
Effective income tax rate	68.2	2,775	(0.4)	61

The amounts recognized in the consolidated statement of financial position consist of:


As at	March 31,
	2025	2024
	$	$
Deferred tax liabilities	(11,228)	(8,099)
Deferred tax assets	4,875	5,715
	(6,353)	(2,384)

Movements in temporary differences during the year were as follows:


As at	March 31, 2025
	Opening balance	Recognized in earnings	Business acquisition	Foreign currency translation adjustment	Total
	$	$	$	$	$
Losses available for carryforward and other tax deductions	9,932	(2,108)	327	—	8,151
Lease liabilities	3,053	(654)	—	(15)	2,384
Deferred financing costs	395	(32)	—	—	363
Total deferred tax assets	13,380	(2,794)	327	(15)	10,898
Intangibles and goodwill	(8,493)	1,292	(2,581)	(45)	(9,827)
Tax credits and other	(5,786)	(349)	(156)	—	(6,291)
Right-of-use assets	(1,485)	352	—	—	(1,133)
Total deferred tax liability	(15,764)	1,295	(2,737)	(45)	(17,251)
Net carrying amount	(2,384)	(1,499)	(2,410)	(60)	(6,353)


As at	March 31, 2024
	Opening balance	Recognized in earnings	Business acquisition	Foreign currency translation adjustment	Total
	$	$	$	$	$
Losses available for carryforward and other tax deductions	18,240	(8,308)	—	—	9,932
Lease liabilities	4,907	(1,854)	—	—	3,053
Deferred financing costs	484	(89)	—	—	395
Total deferred tax assets	23,631	(10,251)	—	—	13,380
Intangibles and goodwill	(16,140)	7,652	—	(5)	(8,493)
Tax credits and other	(7,580)	1,794	—	—	(5,786)
Right-of-use assets	(2,546)	1,061	—	—	(1,485)
Total deferred tax liability	(26,266)	10,507	—	(5)	(15,764)
Net carrying amount	(2,635)	256	—	(5)	(2,384)

12. INCOME TAXES (CONT’D)


Losses available for carryforward for which no deferred tax asset was recognized
Expiry date						Canada
						$
2039						922
2040						390
2041						2,075
2042						3,516
2043						3,603
2044						4,629

						15,135


Losses available for carryforward for which no deferred tax asset was recognized
Expiry date (a)						USA
						$
2038						7,816

Indefinite						15,481
						23,297

(a) Net operating losses amounting to $16,063,000 of which $7,816,000, will expire in 2038, are limited due to the U.S. tax rules applicable on the acquisition of Edgewater Technology Inc. In addition, the Company has i) state losses amounting to approximately $50,846,000 (with expiry dates ranging from 2026 to 2044) and ii) net deductible temporary differences totaling approximately $36,385,000 for which no deferred tax benefit has been recognized.