Guarantees and Product Warranties

In 1997, industrial development revenue bonds were issued on behalf of the Company. The Company guaranteed the payments of principal and interest on the bonds (refer to note 11) by obtaining letters of credit. The carrying value of the bonds was $11.9 as of March 31, 2015 and December 31, 2014.

The Company provides its global operations guarantees and standby letters of credit through various financial institutions for suppliers, customers, regulatory agencies and insurance providers. If the Company is not able to make payment or fulfill contractual obligations, the suppliers, customers, regulatory agencies and insurance providers may draw on the pertinent bank. At March 31, 2015, the maximum future payment obligations related to these various guarantees totaled $106.9, of which $28.0 represented standby letters of credit to insurance providers, and no associated liability was recorded. At December 31, 2014, the maximum future payment obligations relative to these various guarantees totaled $111.1, of which $28.0 represented standby letters of credit to insurance providers, and no associated liability was recorded.

The Company provides its customers a manufacturer’s warranty and records, at the time of the sale, a corresponding estimated liability for potential warranty costs. Estimated future obligations due to warranty claims are based upon historical factors such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. As of March 31, 2015 and 2014, the Company’s warranty liability balances were $97.1 and $82.8, respectively. The increase in warranty is largely attributable to sales to a Brazilian education ministry in LA during 2014.

Changes in the Company’s warranty liability balance are illustrated in the following table:



	2015			2014
Balance at January 1	$	113.3		$	83.2
Current period accruals (1)	(3.5		)	11.9
Current period settlements	(12.7		)	(12.3		)
Balance at March 31	$	97.1		$	82.8


(1)	Includes the impact of foreign exchange rate fluctuations.