Product warranties, guarantees and other commitments

12 Months Ended

Mar. 31, 2012

Product warranties, guarantees and other commitments [Abstract]

Product warranties, guarantees and other commitments

Note 20:  Product warranties, guarantees and other commitments

Product warranties: Modine provides product warranties for its assorted product lines, with warranty periods generally ranging from one to ten years, with the majority falling within a two-to-four year time period. The Company accrues for estimated future warranty costs in the period in which the sale is recorded, and warranty expense estimates are forecasted based on the best information available using analytical and statistical analysis of both historical and current claim data. These expenses are adjusted when it becomes probable that expected claims will differ from initial estimates recorded at the time of the sale.

Changes in the warranty liability were as follows:

Years ended March 31	2012			2011
Balance, April 1	$	14,681		$	13,126
Accruals for warranties issued in current period		6,566			6,611
(Reversals) accruals related to pre-existing warranties		(1,095	)		1,516
Settlements made		(8,334	)		(6,906	)
Effect of exchange rate changes		(433	)		334
Balance, March 31	$	11,385		$	14,681

Indemnification agreements: From time to time, the Company provides indemnification agreements related to the sale or purchase of an entity or facility. These indemnification agreements cover customary representations and warranties typically provided in conjunction with the transactions, including income, sales, excise or other tax matters, environmental matters and other third-party claims. The indemnification periods provided generally range from less than one year to fifteen years. The fair value of the Company's outstanding indemnification obligations at March 31, 2012 is not material.

Commitments: At March 31, 2012, the Company had capital expenditure commitments of $14,682. Significant commitments include tooling and equipment expenditures for new and renewal platforms with new and current customers in Europe and North America along with new program launches in Asia. The Company utilizes consignment inventory arrangements with certain vendors in the normal course of business, under which the suppliers maintain certain inventory stock at the Company's facilities or at other outside facilities. In these cases, the Company has agreements with the vendor to use the material within a specific period of time.