INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2011

Schedule of Income before Income Tax, Domestic and Foreign

Earnings before taxes is summarized as follows:

	2011		2010		2009
	(dollars in thousands)
Domestic	$	125,730	$	104,421	$	96,788
Foreign		14,719		9,815		2,938
Total	$	140,449	$	114,236	$	99,726

Schedule of Components of Income Tax Expense (Benefit)

The provision for income taxes is summarized as follows:

	2011		2010		2009
	(dollars in thousands)
Federal	$	33,778	$	31,309	$	31,359
State and local		7,169		7,052		6,100
Foreign		4,028		3,008		1,111
Total	$	44,975	$	41,369	$	38,570
Current	$	39,554	$	39,949	$	27,447
Deferred		5,421		1,420		11,123
Total	$	44,975	$	41,369	$	38,570

Schedule of Effective Income Tax Rate Reconciliation

Reconciliation of the differences between income taxes computed at the federal statutory rate to the effective rate are as follows:

	2011			2010			2009
U.S. federal statutory tax rate		35.0	%		35.0	%		35.0	%
State taxes, net of federal benefit		3.0			4.1			4.0
Tax reflief for U.S. manufacturers		(2.1	)		(1.9	)		(0.6	)
Permanent book vs. tax differences		(1.1	)		(1.3	)		(1.7	)
U.S. taxes on foreign earnings and foreign tax rate differentials		(1.5	)		(0.3	)		(0.7	)
Reserve adjustments and other		(1.3	)		0.6			2.7
Consolidated effective tax		32.0	%		36.2	%		38.7	%

Schedule of Deferred Tax Assets and Liabilities

At December 31, 2011 and January 1, 2011, the company had recorded the following deferred tax assets and liabilities, which were comprised of the following:

	2011			2010
	(dollars in thousands)
Deferred tax assets:
Federal net operating loss carryforwards	$	20,430		$	28,079
Compensation related		18,654			12,474
Accrued retirement benefits		8,780			5,228
Inventory reserves		4,611			4,429
Product liability and workers compensation reserves		5,052			4,295
Warranty reserves		4,490			4,175
Receivable related reserves		2,350			2,509
UNICAP		2,138			1,984
Accrued plant closure		—			868
State net operating loss carryforwards		580			740
Interest rate swap		1,114			676
Other		10,802			8,805
Gross deferred tax assets		79,001			74,262
Valuation allowance		—			—
Deferred tax assets	$	79,001		$	74,262
Deferred tax liabilities:
Intangible assets	$	(69,998	)	$	(55,901	)
Foreign tax earnings repatriation		(1,546	)		(2,266	)
LIFO reserves		(161	)		(583	)
Depreciation		(2,547	)		(497	)
Other		(3,504	)		(1,353	)
Deferred tax liabilities	$	(77,756	)	$	(60,600	)
Net deferred tax assets (liabilities)	$	1,245		$	13,662
Current deferred asset (liability)	$	39,090		$	25,520
Long-term deferred asset (liability)		(37,845	)		(11,858	)
Net deferred tax assets (liabilities)	$	1,245		$	13,662

Summary of Income Tax Contingencies

The following table summarizes the activity related to the unrecognized tax benefits for the fiscal years ended January 2, 2010, January 1, 2011 and December 31, 2011 (dollars in thousands):

Balance at January 3, 2009	$	10,372
Increases to current year tax positions		3,316
Increase to prior year tax positions		7,474
Decrease to prior year tax positions		(911	)
Balance at January 2, 2010	$	20,251
Increases to current year tax positions		3,524
Increase to prior year tax positions		1,700
Decrease to prior year tax positions		(7,689	)
Balance at January 1, 2011	$	17,786
Increases to current year tax positions		2,113
Increase to prior year tax positions		334
Decrease to prior year tax positions		(2,393	)
Settlements		(1,494	)
Lapse of statute of limitations		(755	)
Balance at December 31, 2011	$	15,591

Summary of Income Tax Examinations

A summary of the tax years that remain subject to examination in the company’s major tax jurisdictions are:

United States – federal	2008 – 2011
United States – states	2004 – 2011
Austrailia	2011
Brazil	2010 - 2011
Canada	2009 – 2011
China	2003 – 2011
Denmark	2007 – 2011
France	2011
Germany	2011
Italy	2009 – 2011
Mexico	2006 – 2011
Philippines	2007 – 2011
South Korea	2006 – 2011
Spain	2008 – 2011
Taiwan	2008 – 2011
United Kingdom	2008 – 2011