CORRECTION OF PRIOR PERIOD ERROR

9 Months Ended

Sep. 30, 2023

Accounting Changes and Error Corrections [Abstract]

During the third quarter of 2023, the Corporation identified an error related to a single long-term contract within a subsidiary of its Naval & Power segment. The error primarily impacts 2020 and 2021, whereby certain events occurring during the pandemic, including constructive changes to the contract as well as labor inefficiencies and hiring delays due to a facility relocation, were not reflected in the contract’s estimated costs of completion.

In accordance with Staff Accounting Bulletin ("SAB") Nos. 99 and 108, the Corporation evaluated this error and, based on an analysis of quantitative and qualitative factors, determined that it was not material to any one of the prior reporting periods affected and, therefore, amendment of previously filed reports with the Securities and Exchange Commission is not required.

However, if the adjustment to correct the cumulative effect of the aforementioned error had been recorded in the three and nine months ended September 30, 2023, the impact would have been qualitatively material to the Condensed Consolidated Statements of Earnings for those respective periods. Therefore, in accordance with SAB 108, the Corporation has revised the applicable prior period financial statements included within this filing, as summarized below.

The net impact of the error resulted in an overstatement of previously reported total net sales and net earnings of approximately $5 million and $4 million, respectively, for the year ended December 31, 2021 and an overstatement of previously reported total net sales and net earnings of approximately $8 million and $7 million, respectively, for the year ended December 31, 2020. The impact of the error on previously reported total net sales and net earnings was inconsequential for the year ended December 31, 2022. The Company will revise its consolidated financial statements as of and for the year ended December 31, 2021 in conjunction with the issuance of the 2023 Form 10-K. The error did not impact net cash provided by operating activities within the Condensed Consolidated Statements of Cash Flows in any prior period.

The Condensed Consolidated Balance Sheet as of December 31, 2022 has been revised as follows:



(In thousands)	As previously reported		Corrections		As revised
Receivables, net	$	724,603	$	(1,299)	$	723,304
Total current assets	1,517,313		(1,299)		1,516,014
Total assets	4,449,602		(1,299)		4,448,303
Accrued expenses	177,536		(3,096)		174,440
Deferred revenue	242,483		12,318		254,801
Other current liabilities	82,395		384		82,779
Total current liabilities	971,439		9,606		981,045
Total liabilities	2,457,483		9,606		2,467,089
Retained earnings	3,174,396		(10,905)		3,163,491
Total stockholders' equity	1,992,119		(10,905)		1,981,214
Total liabilities and stockholders' equity	4,449,602		(1,299)		4,448,303