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Research and Development Expenditures
 9 Months Ended
Sep. 30, 2017
Research and Development [Abstract]  
Research and Development Expenditures
Research and Development Expenditures

The Company's net Research & Development ("R&D") expenditures are included in selling, general and administrative expenses of the Condensed Consolidated Statements of Operations. Customer reimbursements are netted against gross R&D expenditures as they are considered a recovery of cost. Customer reimbursements for prototypes are recorded net of prototype costs based on customer contracts, typically either when the prototype is shipped or when it is accepted by the customer. Customer reimbursements for engineering services are recorded when performance obligations are satisfied in accordance with the contract and accepted by the customer. Financial risks and rewards transfer upon shipment, acceptance of a prototype component by the customer or upon completion of the performance obligation as stated in the respective customer agreement.

The following table presents the Company’s gross and net expenditures on R&D activities:
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Gross R&D expenditures
$
115.2

 
$
106.1

 
$
346.9

 
$
311.1

Customer reimbursements
(13.7
)
 
(17.5
)
 
(44.1
)
 
(52.2
)
Net R&D expenditures
$
101.5

 
$
88.6

 
$
302.8

 
$
258.9



The Company has contracts with several customers at the Company's various R&D locations. No such contract exceeded 5% of annual net R&D expenditures in any of the periods presented.