Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Basis of Presentation and Description of Business [Abstract]

Principles of consolidation [Policy Text Block]

All majority-owned subsidiaries are included in the Company’s consolidated financial statements,

with appropriate elimination of intercompany balances and transactions. 

Investments in associated companies (less than majority-

owned and in which the Company has significant influence) are accounted for under the equity method. The Company’s share of net

income or losses in these investments in associated companies is included in the Consolidated Statements of Income.

 The Company

periodically reviews these investments for impairments and, if necessary, would adjust these investments to their fair value when a

decline in market value or other impairment indicators are deemed to be other than temporary.

Translation of foreign currency [Policy Text Block]

Assets and liabilities of non-U.S. subsidiaries and associated companies are translated into

U.S. dollars at the respective rates of exchange prevailing at the end of the year. Income and expense accounts are translated at

average exchange rates prevailing during the year. Translation adjustments resulting from this process are recorded directly in equity

as accumulated other comprehensive (loss) income (“AOCI”) and will be included as income or expense only upon sale or liquidation

of the underlying entity or asset. Generally, all of the Company’s non-U.S. subsidiaries use their local currency as their functional

currency.

Cash and Cash Equivalents [Policy Text Block]

The Company invests temporary and excess funds in money market securities and financial

instruments having maturities within 90 days. The Company considers all highly liquid investments with original maturities of three

months or less to be cash equivalents.

 The Company has not experienced losses from the aforementioned investments.

Accounts receivable and allowance for doubtful accounts [Policy Text Block]

Trade accounts receivable subject the Company to credit risk. 

Trade accounts receivable are recorded at the invoiced amount and generally do not bear interest. The allowance for doubtful

accounts is the Company’s best estimate of the amount of expected credit losses with its existing accounts receivable. The Company

adopted ASU 2016-13,

Financial Instruments - Credit Losses (Topic

326): Measurement of Credit

Losses on Financial Instruments

on

a modified retrospective basis, effective January 1, 2020. 

The Company recognizes an allowance for credit losses, which represents the portion of the receivable that the Company does not

expect to collect over its contractual life, considering past events and reasonable and supportable forecasts of future economic

conditions. The Company’s allowance for credit losses on its trade accounts receivable is based on specific collectability facts and

circumstances for each outstanding receivable and customer, the aging of outstanding receivables, and the associated collection risk

the Company estimates for certain past due aging categories, and also, the general risk to all outstanding accounts receivable based on

historical amounts determined to be uncollectible. The Company does not have any off-balance-sheet credit exposure related to its

customers.

Inventories [Policy Text Block]

Inventories are valued at the lower of cost or net realizable value, and are valued using the first-in, first-out method.

Right of use lease assets and lease liabilities [Policy Text Block]

The Company determines if an arrangement is a lease at its inception. This

determination generally depends on whether the arrangement conveys the right to control the use of an identified fixed asset explicitly

or implicitly for a period of time in exchange for consideration. Control of an underlying asset is conveyed if the Company obtains

the rights to direct the use of, and obtains substantially all of the economic benefits from the use of, the underlying asset. Lease

expense for variable leases and short-term leases is recognized when the obligation is incurred. 

The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods

covered by an option to extend the lease that the Company is reasonably certain it will exercise. Operating leases are included in right

of use lease assets, other accrued liabilities and long-term lease liabilities on the Consolidated Balance Sheet. Right of use lease assets

and liabilities are recognized at each lease’s commencement date based on the present value of its lease payments over its respective

lease term. 

The Company uses the stated borrowing rate for a lease when readily determinable. When a stated borrowing rate is not available

in a lease agreement, the Company uses its incremental borrowing rate based on information available at the lease’s commencement

date to determine the present value of its lease payments. In determining the incremental borrowing rate used to present value each of

its leases, the Company considers certain information including fully secured borrowing rates readily available to the Company and its

subsidiaries. The Company has immaterial finance leases, which are included in Property, plant and equipment (“PP&E”) , current

portion of long-term debt and long-term debt on the Consolidated Balance Sheet.

Long-lived assets [Policy Text Block]

PP&E is stated at gross cost, less accumulated depreciation. Depreciation is computed using the straight-

line method on an individual asset basis over the following estimated useful lives: buildings and improvements,

10

 to

45

 years; and

machinery and equipment,

1

 to

15

 years. The carrying values of long-lived assets are evaluated whenever changes in circumstances or

current events indicate the carrying amount of such assets may not be recoverable. An estimate of undiscounted cash flows produced

by the asset, or the appropriate group of assets, is compared with the carrying value to determine whether an impairment exists. If

necessary, the Company recognizes an impairment loss for the difference between the carrying amount of the assets and their

estimated fair value. Fair value is based on current and anticipated future cash flows. Upon sale or other dispositions of long-lived

assets, the applicable amounts of asset cost and accumulated depreciation are removed from the accounts and the net amount, less

proceeds from disposals, is recorded in the Consolidated Statements of Income. Expenditures for renewals or improvements that

increase the estimated useful life or capacity of the assets are capitalized, whereas expenditures for repairs and maintenance are

expensed when incurred.

Capitalized software [Policy Text Block]

The Company capitalizes certain costs in connection with developing or obtaining software for internal

use, depending on the associated project. These costs are amortized over a period of

3

 to

5

 years once the assets are ready for their

intended use.

Goodwill and other intangible assets [Policy Text Block]

The Company records goodwill, definite-lived intangible assets and indefinite-lived

intangible assets at fair value at the date of acquisition. Goodwill and indefinite-lived intangible assets are not amortized but tested for

impairment at least annually. These tests will be performed more frequently if triggering events indicate potential impairment.

Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, generally for periods ranging

from

3

 to

24

 years. The Company continually evaluates the reasonableness of the useful lives of these assets, consistent with the

discussion of long-lived assets, above.

Revenue recognition [Policy Text Block]

The Company applies the Financial Accounting Standards Board’s (“FASB’s”) guidance on revenue

recognition which requires the Company to recognize revenue in an amount that reflects the consideration to which the Company

expects to be entitled in exchange for goods or services transferred to its customers. To do this, the Company applies the five-step

model in the FASB’s guidance, which requires the Company to: (i) identify the contract with a customer; (ii) identify the performance

obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the

contract; and (v) recognize revenue when, or as, the Company satisfies a performance obligation. 

The Company identifies a contract with a customer when a sales agreement indicates approval and commitment of the parties;

identifies the rights of the parties; identifies the payment terms; has commercial substance; and it is probable that the Company will

collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer.

The Company identifies a performance obligation in a contract for each promised good or service that is separately identifiable

from other obligations in the contract and for which the customer can benefit from the good or service either on its own or together

with other resources that are readily available to the customer. The Company determines the transaction price as the amount of

consideration it expects to be entitled to in exchange for fulfilling the performance obligations, including the effects of any variable

consideration, significant financing elements, amounts payable to the customer or noncash consideration. For any contracts that have

more than one performance obligation, the Company allocates the transaction price to each performance obligation in an amount that

depicts the amount of consideration to which the Company expects to be entitled in exchange for satisfying each performance

obligation.

In accordance with the last step of the FASB’s guidance, the Company recognizes revenue when, or as, it satisfies the

performance obligation in a contract by transferring control of a promised good or providing the service to the customer. The

Company typically satisfies its performance obligations and recognizes revenue at a point in time for product sales, generally when

products are shipped or delivered to the customer, depending on the terms underlying each arrangement. In circumstances where the

Company’s products are on consignment, revenue is generally recognized upon usage or consumption by the customer. For any

Fluidcare

TM

 or other services provided by the Company to the customer, the Company typically satisfies its performance obligations

and recognizes revenue over time, as the promised services are performed. The Company uses input methods to recognize revenue

over time related to these services, including labor costs and time incurred. The Company believes that these input methods represent

the most indicative measure of the Fluidcare

TM

 or other service work performed by the Company.

The Company does not have standard payment terms for all customers, however the Company’s general payment terms require

customers to pay for products or services provided after the performance obligation is satisfied. The Company does not have

significant financing arrangements with its customers. Therefore, the Company does not adjust the promised amount of consideration

for the effects of a significant financing component as the Company expects, at contract inception, that the period between when the

Company transfers a promised good or service to the customer and when the customer pays for that good or service will be one year or

less. 

In addition, the Company expenses costs to obtain a contract as incurred when the expected period of benefit, and therefore the

amortization period, is one year or less. In addition, the Company excludes from the measurement of the transaction price all taxes

assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and

collected by the entity from a customer, including sales, use, value added, excise and various other taxes. Lastly, the Company has

elected to account for shipping and handling activities that occur after the customer has obtained control of a good as a fulfilment cost,

rather than an additional promised service. The Company does not have significant amounts of variable consideration in its contracts

with customers and where applicable, the Company’s estimates of variable consideration are not constrained. 

The Company records certain third-party license fees in other income (expense), net, in its Consolidated Statement of Income,

which generally include sales-based royalties in exchange for the license of intellectual property. These license fees are recognized in

accordance with their agreed-upon terms and when performance obligations are satisfied, which is generally when the third party has a

subsequent sale.

The Company recognizes a contract asset or receivable on its Consolidated Balance Sheet when the Company performs a service

or transfers a good in advance of receiving consideration. A receivable is the Company’s right to consideration that is unconditional

and only the passage of time is required before payment of that consideration is due. A contract asset is the Company’s right to

consideration in exchange for goods or services that the Company has transferred to a customer. 

A contract liability is recognized when the Company receives consideration, or if it has the unconditional right to receive

consideration, in advance of performance. A contract liability is the Company’s obligation to transfer goods or services to a customer

for which the Company has received consideration, or a specified amount of consideration is due, from the customer.

See Note 5 of Notes to Consolidated Financial Statements. 

Research and development costs:

Research and development costs are expensed as incurred and are included in selling, general

and administrative expenses (“SG&A”).

 Research and development expenses were $

44.9

 million, $

40.0

 million and $

32.1

 million for

the years ended December 31, 2021, 2020 and 2019, respectively. 

Environmental liabilities and expenditures:

Accruals for environmental matters are recorded when it is probable that a liability

has been incurred and the amount of the liability can be reasonably estimated. If there is a range of estimated liability and no amount

in that range is considered more probable than another, then the Company records the lowest amount in the range in accordance with

generally accepted accounting principles in the United States (“U.S. GAAP”). Environmental costs and remediation costs are

capitalized if the costs extend the life, increase the capacity or improve safety or efficiency of the property from the date acquired or

constructed, and/or mitigate or prevent contamination in the future.

 See Note 26 of Notes to Consolidated Financial Statements. 

Asset retirement obligations:

The Company follows the FASB’s guidance regarding asset retirement obligations, which

addresses the accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated

retirement costs. Also, the Company follows the FASB’s guidance for conditional asset retirement obligations (“CARO”), which

relates to legal obligations to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on

a future event that may or may not be within the control of the entity. In accordance with this guidance, the Company records a

liability when there is enough information regarding the timing of the CARO to perform a probability-weighted discounted cash flow

analysis. As of December 31, 2021 and 2020, the Company had limited exposure to such obligations and had immaterial liabilities

recorded for such on its Consolidated Balance Sheets.

Pension and other postretirement benefits:

The Company maintains various noncontributory retirement plans, covering a

portion of its employees in the U.S. and certain other countries, including the Netherlands, the United Kingdom (“U.K.”), Mexico,

Sweden, Germany and France. These retirement plans are subject to the provisions of FASB’s guidance regarding employers’

accounting for defined benefit pension plans. The plans of the remaining non-U.S. subsidiaries are, for the most part, either fully

insured or integrated with the local governments’ plans and are not subject to the provisions of the guidance. The guidance requires

Research and Development Expense, Policy [Policy Text Block]

Research and development costs are expensed as incurred and are included in selling, general

and administrative expenses (“SG&A”).

Environmental liabilities and expenditures [Policy Text Block]

Accruals for environmental matters are recorded when it is probable that a liability

has been incurred and the amount of the liability can be reasonably estimated. If there is a range of estimated liability and no amount

in that range is considered more probable than another, then the Company records the lowest amount in the range in accordance with

generally accepted accounting principles in the United States (“U.S. GAAP”). Environmental costs and remediation costs are

capitalized if the costs extend the life, increase the capacity or improve safety or efficiency of the property from the date acquired or

constructed, and/or mitigate or prevent contamination in the future.

Asset Retirement Obligations, Policy [Policy Text Block]

The Company follows the FASB’s guidance regarding asset retirement obligations, which

addresses the accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated

retirement costs. Also, the Company follows the FASB’s guidance for conditional asset retirement obligations (“CARO”), which

relates to legal obligations to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on

a future event that may or may not be within the control of the entity. In accordance with this guidance, the Company records a

liability when there is enough information regarding the timing of the CARO to perform a probability-weighted discounted cash flow

analysis. As of December 31, 2021 and 2020, the Company had limited exposure to such obligations and had immaterial liabilities

recorded for such on its Consolidated Balance Sheets.

Pension and other postretirement benefits [Policy Text Block]

The Company maintains various noncontributory retirement plans, covering a

portion of its employees in the U.S. and certain other countries, including the Netherlands, the United Kingdom (“U.K.”), Mexico,

Sweden, Germany and France. These retirement plans are subject to the provisions of FASB’s guidance regarding employers’

accounting for defined benefit pension plans. The plans of the remaining non-U.S. subsidiaries are, for the most part, either fully

insured or integrated with the local governments’ plans and are not subject to the provisions of the guidance. The guidance requires

that employers recognize on a prospective basis the funded status of their defined benefit pension and other postretirement plans on

their consolidated balance sheet and, also, recognize as a component of AOCI, net of tax, the gains or losses and prior service costs or

credits that arise during the period but are not recognized as components of net periodic benefit cost. In addition, the guidance

requires that an employer recognize a settlement charge in their consolidated statement of income when certain events occur,

including plan termination or the settlement of certain plan liabilities. A settlement charge represents the immediate recognition into

expense of a portion of the unrecognized loss within AOCI on the balance sheet in proportion to the share of the projected benefit

obligation that was settled. The measurement date for the Company’s postretirement benefits plan is December 31. 

The Company’s global pension investment policies are designed to ensure that pension assets are invested in a manner consistent

with meeting the future benefit obligations of the pension plans and maintaining compliance with various laws and regulations

including the Employee Retirement Income Security Act of 1974. The Company establishes strategic asset allocation percentage

targets and benchmarks for significant asset classes with the aim of achieving a prudent balance between return and risk. The

Company’s investment horizon is generally long term, and, accordingly, the target asset allocations encompass a long-term

perspective of capital markets, expected risk and return and perceived future economic conditions while also considering the profile of

plan liabilities. To the extent feasible, the short-term investment portfolio is managed to match the short -term obligations, the

intermediate portfolio duration is matched to reduce the risk of volatility in intermediate plan distributions, and the total return

portfolio is managed to maximize the long-term real growth of plan assets. The critical investment principles of diversification,

assessment of risk and targeting the optimal expected returns for given levels of risk are applied. The Company’s investment

guidelines prohibit the use of securities such as letter stock and other unregistered securities, commodities or commodity contracts,

short sales, margin transactions, private placements (unless specifically addressed by addendum), or any derivatives, options or futures

for the purpose of portfolio leveraging. 

The target asset allocation is reviewed periodically and is determined based on a long-term projection of capital market outcomes,

inflation rates, fixed income yields, returns, volatilities and correlation relationships. The interaction between plan assets and benefit

obligations is periodically studied to assist in establishing such strategic asset allocation targets. Asset performance is monitored with

an overall expectation that plan assets will meet or exceed benchmark performance over rolling five year periods. The Company’s

pension committee, as authorized by the Company’s Board of Directors (the “Board”), has discretion to manage the assets within

established asset allocation ranges approved by senior management of the Company.

 See Note 21 of Notes to Consolidated Financial

Statements. 

Comprehensive income (loss):

The Company presents other comprehensive income (loss) in its Statements of Comprehensive

Income. The Company follows the FASB’s guidance regarding the disclosure of reclassifications from AOCI which requires the

disclosure of significant amounts reclassified from each component of AOCI, the related tax amounts and the income statement line

items affected by such reclassifications.

 See Note 23 of Notes to Consolidated Financial Statements. 

Income taxes and uncertain tax positions:

The provision for income taxes is determined using the asset and liability approach

of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the

reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or

payable for the current year and the change in deferred taxes during the year. Deferred taxes result from differences between the

financial and tax bases of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are

enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be

realized. The FASB’s guidance regarding accounting for uncertainty in income taxes prescribes the recognition threshold and

measurement attributes for financial statement recognition and measurement of tax positions taken or expected to be taken on a tax

return. The guidance further requires the determination of whether the benefits of tax positions are probable or more likely than not

sustained upon audit based upon the technical merits of the tax position. For tax positions that are determined to be more likely than

not sustained upon audit, a company recognizes the largest amount of benefit that is greater than

50

% likely of being realized upon

ultimate settlement in the financial statements. For tax positions that are not determined to be more likely than not sustained upon

audit, a company does not recognize any portion of the benefit in the financial statements. Additionally, the Company monitors and

adjusts for derecognition, classification, and penalties and interest in interim periods, with appropriate disclosure and transition

thereto. Also, the amount of interest expense and income related to uncertain tax positions is computed by applying the applicable

statutory rate of interest to the difference between the tax position recognized, including timing differences, and the amount previously

taken or expected to be taken in a tax return. The Company recognizes interest and/or penalties related to income tax matters in

income tax expense. Finally, when applicable, the Company nets its liability for unrecognized tax benefits against deferred tax assets

related to net operating losses or other tax credit carryforwards that would apply if the uncertain tax position were settled for the

presumed amount at the balance sheet date.

Comprehensive income (loss) [Policy Text Block]

The Company presents other comprehensive income (loss) in its Statements of Comprehensive

Income. The Company follows the FASB’s guidance regarding the disclosure of reclassifications from AOCI which requires the

disclosure of significant amounts reclassified from each component of AOCI, the related tax amounts and the income statement line

items affected by such reclassifications.

Income taxes and uncertain tax positions [Policy Text Block]

The provision for income taxes is determined using the asset and liability approach

of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the

reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or

payable for the current year and the change in deferred taxes during the year. Deferred taxes result from differences between the

financial and tax bases of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are

enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be

realized. The FASB’s guidance regarding accounting for uncertainty in income taxes prescribes the recognition threshold and

measurement attributes for financial statement recognition and measurement of tax positions taken or expected to be taken on a tax

return. The guidance further requires the determination of whether the benefits of tax positions are probable or more likely than not

sustained upon audit based upon the technical merits of the tax position. For tax positions that are determined to be more likely than

not sustained upon audit, a company recognizes the largest amount of benefit that is greater than

50

% likely of being realized upon

ultimate settlement in the financial statements. For tax positions that are not determined to be more likely than not sustained upon

audit, a company does not recognize any portion of the benefit in the financial statements. Additionally, the Company monitors and

adjusts for derecognition, classification, and penalties and interest in interim periods, with appropriate disclosure and transition

thereto. Also, the amount of interest expense and income related to uncertain tax positions is computed by applying the applicable

statutory rate of interest to the difference between the tax position recognized, including timing differences, and the amount previously

taken or expected to be taken in a tax return. The Company recognizes interest and/or penalties related to income tax matters in

income tax expense. Finally, when applicable, the Company nets its liability for unrecognized tax benefits against deferred tax assets

related to net operating losses or other tax credit carryforwards that would apply if the uncertain tax position were settled for the

presumed amount at the balance sheet date.

Derivatives [Policy Text Block]

The Company is exposed to the impact of changes in interest rates, foreign currency fluctuations, changes in

commodity prices and credit risk. The Company utilizes interest rate swap agreements to enhance its ability to manage risk, including

exposure to variability in interest payments associated with its variable rate debt. Derivative instruments are entered into for periods

consistent with the related underlying exposures and do not constitute positions independent of those exposures. As of December 31,

2021 and 2020, the Company had certain interest rate swap agreements that were designated as cash flow hedges. Interest rate swaps

are entered into with a limited number of counterparties, each of which allows for net settlement of all contracts through a single

payment in a single currency in the event of a default on or termination of any one contract. The Company records these instruments

on a net basis within the Consolidated Balance Sheets. The effective portion of the change in fair value of the agreement is recorded

in AOCI and will be recognized in the Consolidated Statements of Income when the hedge item affects earnings or losses or it

becomes probable that the forecasted transaction will not occur.

Fair value measurements [Policy Text Block]

The Company utilizes the FASB’s guidance regarding fair value measurements, which establishes a

common definition for fair value to be applied to guidance requiring use of fair value, establishes a framework for measuring fair

value and expands disclosure about such fair value measurements. Specifically, the guidance utilizes a fair value hierarchy that

prioritizes the inputs to valuation techniques used to measure fair value into three broad levels.

•

Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

•

Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These

include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or

liabilities in markets that are not active.

•

Level 3: Unobservable inputs that reflect the reporting entity's own assumptions.

Share-based compensation [Policy Text Block]

The Company applies the FASB’s guidance regarding share-based payments, which requires the

recognition of the fair value of share-based compensation as a component of expense. The Company has a long-term incentive

program (“LTIP”) for key employees which provides for the granting of options to purchase stock at prices not less than its market

value on the date of the grant. Most options become exercisable within

three years

 after the date of the grant for a period of time

determined by the Company, but not to exceed

seven years

 from the date of grant. Restricted stock awards and restricted stock units

issued under the LTIP program are subject to time vesting generally over a

one

 to

three year

 period. In addition, as part of the

Company’s Annual Incentive Plan, nonvested shares may be issued to key employees, which generally would vest over a

two

 to

five

year period. 

In addition, while the FASB’s guidance permits the Company to make an accounting policy election to account for forfeitures as

they occur for service condition aspects of certain share-based awards, the Company has decided not to elect this accounting policy

and instead has elected to continue utilizing a forfeiture rate assumption. Based on historical experience, the Company has assumed a

forfeiture rate of

13

% on certain of its nonvested stock awards. The Company will record additional expense if the actual forfeiture

rate is lower than estimated and will record a recovery of prior expense if the actual forfeiture is higher than estimated. 

The Company also issues performance-dependent stock awards as a component of its LTIP. The fair value of the performance-

dependent stock awards is based on their grant-date market value adjusted for the likelihood of attaining certain pre-determined

performance goals and is calculated by utilizing a Monte Carlo simulation model. Compensation expense is recognized on a straight-

line basis over the vesting period, generally

three years

.

Earnings Per Share [Policy Text Block]

The Company follows the FASB’s guidance regarding the calculation of earnings per share for nonvested

stock awards with rights to non-forfeitable dividends. The guidance requires nonvested stock awards with rights to non-forfeitable

dividends to be included as part of the basic weighted average share calculation under the two-class method.

Segments [Policy Text Block]

The Company’s operating segments, which are consistent with its reportable segments, reflect the structure of the

Company’s internal organization, the method by which the Company’s resources are allocated and the manner by which the chief

operating decision maker assesses the Company’s performance

Hyper-inflationary accounting [Policy Text Block]

Economies that have a cumulative three year rate of inflation exceeding

100

% are considered

hyper-inflationary in accordance with U.S. GAAP. A legal entity that operates within an economy deemed to be hyper-inflationary is

required to remeasure its monetary assets and liabilities to the applicable published exchange rates and record the associated gains or

losses resulting from the remeasurement directly to the Consolidated Statements of Income.

Business Combinations [Policy Text Block]

The Company accounts for business combinations under the acquisition method of accounting. This

method requires the recording of acquired assets, including separately identifiable intangible assets, and assumed liabilities at their

respective acquisition date estimated fair values. Any excess of the purchase price over the estimated fair value of the identifiable net

assets acquired is recorded as goodwill. The determination of the estimated fair value of assets acquired and liabilities assumed

requires significant estimates and assumptions. Based on the assessment of additional information during the measurement period,

which may be up to one year from the acquisition date, the Company may record adjustments to the estimated fair value of assets

acquired and liabilities assumed.

Restructuring activities [Policy Text Block]

Restructuring programs consist of employee severance, rationalization of manufacturing or other

facilities and other related items. To account for such programs, the Company applies FASB’s guidance regarding exit or disposal

cost obligations. This guidance requires that a liability for a cost associated with an exit or disposal activity be recognized when the

liability is incurred, is estimable, and payment is probable.

Reclassification [Policy Text Block]

Certain information has been reclassified to conform to the current year presentation.

Accounting estimates [Policy Text Block]

The preparation of financial statements in conformity with generally accepted accounting principles

requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of

contingencies at the date of the financial statements and the reported amounts of net sales and expenses during the reporting period. 

Actual results could differ from such estimates.

Consolidation, Variable Interest Entity [Policy Text Block]

The Company is not the primary beneficiary of any variable interest entities (“VIEs”) and therefore the

Company’s consolidated financial statements do not include the accounts of any VIEs.

Equity Method Investments [Policy Text Block]

Investments in associated companies (less than majority-

owned and in which the Company has significant influence) are accounted for under the equity method. The Company’s share of net

income or losses in these investments in associated companies is included in the Consolidated Statements of Income.

 The Company

periodically reviews these investments for impairments and, if necessary, would adjust these investments to their fair value when a

decline in market value or other impairment indicators are deemed to be other than temporary.