SCHNITZER STEEL INDUSTRIES, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 88 / Schnitzer Steel Industries, Inc. Form 10-K 2017 Accounting for Uncertainty in Income Taxes The following table summarizes the activity related to the Company’s reserve for unrecognized tax benefits, excluding interest and penalties, for the years ended August 31 (in thousands): 2017 2016 2015 Unrecognized tax benefits, as of the beginning of the year $ 4,724 $ 3,970 $ 2,780 Additions for tax positions of prior years — — — Reductions for tax positions of prior years (120) (56) — Additions for tax positions of the current year 944 810 1,571 Settlements with tax authorities — — (381) Unrecognized tax benefits, as of the end of the year $ 5,548 $ 4,724 $ 3,970 The Company does not anticipate any material changes to the reserve in the next 12 months. Reserves pertaining to positions claimed on the fiscal year 2013 through 2017 tax returns would result in net operating loss offsets in the event the positions were successfully challenged. Pursuant to FASB's Accounting Standards Update 2013-11, the reserves are netted against deferred tax assets related to net operating loss carryforwards. The Company believes that it is reasonably possible that approximately $2 million of its currently remaining unrecognized tax benefits may be recognized by the end of fiscal 2018 as a result of a lapse of the statute of limitations. The recognized amounts of tax-related penalties and interest were not material for all periods presented. The Company files federal and state income tax returns in the U.S. and foreign tax returns in Puerto Rico and Canada. For U.S. federal income tax returns, fiscal years 2013 to 2016 remain subject to examination under the statute of limitations. Note 16 – Net Income (Loss) Per Share The following table sets forth the information used to compute basic and diluted net income (loss) per share attributable to SSI for the years ended August 31 (in thousands): 2017 2016 2015 Income (loss) from continuing operations $ 47,368 $ (16,240) $ (187,849) Net income attributable to noncontrolling interests (2,467) (1,821) (1,933) Income (loss) from continuing operations attributable to SSI 44,901 (18,061) (189,782) Loss from discontinued operations, net of tax (390) (1,348) (7,227) Net income (loss) attributable to SSI $ 44,511 $ (19,409) $ (197,009) Computation of shares: Weighted average common shares outstanding, basic 27,537 27,229 27,010 Incremental common shares attributable to dilutive performance share, RSU and DSU awards 604 — — Weighted average common shares outstanding, diluted 28,141 27,229 27,010 Common stock equivalent shares of 251,899, 1,016,745 and 1,018,858 were considered antidilutive and were excluded from the calculation of diluted net income (loss) per share attributable toSSI for the years endedAugust 31, 2017, 2016 and 2015, respectively. Note 17 – Related Party Transactions The Company purchases recycled metal from its joint venture operations at prices that approximate fair market value. These purchases totaled $14 million, $12 million and $22 million for the years ended August 31, 2017, 2016 and 2015, respectively.