New Accounting Pronouncements

6 Months Ended

Apr. 02, 2016

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New Accounting Pronouncements

New Accounting Pronouncements

Stock Compensation - Employee Share-based Payments

In March 2016, the Financial Accounting Standards Board (FASB) issued guidance to amend certain aspects of accounting for employee share-based payment transactions, including accounting for income taxes related to those transactions. This guidance will require recognizing excess tax benefits and deficiencies on share-based compensation arrangements in the tax provision, instead of in equity. In addition, the guidance requires these amounts to be classified as an operating activity and shares withheld to satisfy employee taxes to be classified as a financing activity in the statement of cash flow, which are currently classified as financing and operating activities, respectively. The guidance is effective beginning in the first quarter of the Company’s 2018 fiscal year (with early adoption permitted) and is required to be adopted as follows:

• Prospectively for the recognition of excess tax benefits and deficiencies in the tax provision

• Retrospectively or prospectively for the classification of income tax benefits and deficiencies in the statement of cash flow

• Retrospectively for the classification of shares withheld to satisfy employee taxes in the statement of cash flow

Leases

In February 2016, the FASB issued a new lease accounting standard, which requires operating leases to be recorded as right-of-use lease assets and lease liabilities on the balance sheet. The Company is currently assessing the impact of the new guidance on its financial statements. The guidance is required to be adopted retrospectively by restating all years presented in the Company’s financial statements. The guidance is effective beginning in the first quarter of the Company’s 2020 fiscal year (with early adoption permitted).

Income Taxes

In November 2015, the FASB issued guidance to simplify the presentation of deferred income taxes by reporting the net amount of deferred tax assets and liabilities on a jurisdiction by jurisdiction basis as noncurrent on the balance sheet. The Company adopted the provisions of this guidance in the first quarter of fiscal 2016 and applied the provisions prospectively.

Revenue from Contracts with Customers

In May 2014, the FASB issued guidance that replaces the existing accounting standards for revenue recognition. The guidance provides a five step framework to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services. Since its issuance, the FASB has amended several aspects of the new guidance including provisions that address revenue recognition associated with the licensing of intellectual property. The new guidance, including the amendments, is effective beginning the first quarter of the Company’s 2019 fiscal year (with early adoption permitted beginning fiscal year 2018). The guidance may be adopted either by restating all years presented in the Company’s financial statements or by recording the impact of adoption as an adjustment to retained earnings at the beginning of the year of adoption. The Company is assessing the potential impact this guidance will have on its financial statements.