Revenue Recognition and Contracts with Customers

3 Months Ended

Jun. 30, 2021

Change In Contract With Customer Asset And Liability [Abstract]

Revenue Recognition and Contracts with Customers

4.    REVENUE RECOGNITION AND CONTRACTS WITH CUSTOMERS

Disaggregation of Revenue

The Company disaggregates revenue based on the method of measuring satisfaction of the performance obligation either over time or at a point in time. Additionally, the Company disaggregates revenue based upon the end market where products and services are transferred to the customer. The Company’s principal operating segments and related revenue are discussed in Note 11, Segments.

The following table shows disaggregated net sales satisfied overtime and at a point in time (excluding intercompany sales) for the three months ended June 30, 2021 and 2020:

	Three Months Ended June 30,
	2021		2020
Systems & Support
Satisfied over time	$	118,981	$	103,348
Satisfied at a point in time		138,222		130,948
Revenue from contracts with customers		257,203		234,296
Amortization of acquired contract liabilities		1,202		3,719
Total revenue		258,405		238,015
Aerospace Structures
Satisfied over time	$	129,523	$	243,639
Satisfied at a point in time		8,706		6,155
Revenue from contracts with customers		138,229		249,794
Amortization of acquired contract liabilities		12		7,268
Total revenue		138,241		257,062
	$	396,646	$	495,077

The following table shows disaggregated net sales by end market (excluding intercompany sales) for the three months ended June 30, 2021 and 2020:

	Three Months Ended June 30,
	2021		2020
Systems & Support
Commercial aerospace	$	97,456	$	92,180
Military		135,807		120,384
Business jets		12,357		10,374
Regional		5,273		5,875
Non-aviation		6,310		5,483
Revenue from contracts with customers		257,203		234,296
Amortization of acquired contract liabilities		1,202		3,719
Total revenue	$	258,405	$	238,015
Aerospace Structures
Commercial aerospace	$	112,661	$	140,971
Military		13,703		38,256
Business jets		10,213		65,952
Regional		1,634		4,611
Non-aviation		18		4
Revenue from contracts with customers		138,229		249,794
Amortization of acquired contract liabilities		12		7,268
Total revenue		138,241		257,062
	$	396,646	$	495,077

Contract Assets and Liabilities

Contract assets primarily represent revenues recognized for performance obligations that have been satisfied or partially satisfied but for which amounts have not been billed. This typically occurs when revenue is recognized over time but the Company's contractual right to bill the customer and receive payment is conditional upon the satisfaction of additional performance obligations in the contract, such as final delivery of the product. Contract assets are recognized when the revenue associated with the contract is recognized prior to billing and derecognized when billed in accordance with the terms of the contract. The Company pools contract assets that share underlying risk characteristics and records an allowance for expected credit losses based on a combination of prior experience, current economic conditions and management’s expectations of future economic conditions, and specific collectibility matters when they arise. Contract assets are presented net of this reserve on the condensed consolidated

balance sheets. For the three months ended June 30, 2021 and 2020, credit loss expense and write-offs related to contract assets were immaterial.

Contract liabilities are recorded when customers remit contractual cash payments in advance of the Company satisfying performance obligations under contractual arrangements, including those with performance obligations to be satisfied over a period of time. Contract liabilities other than those pertaining to forward loss reserves are derecognized when or as revenue is recognized.

Contract modifications can also impact contract asset and liability balances. When contracts are modified to account for changes in contract specifications and requirements, the Company considers whether the modification either creates new or changes the existing enforceable rights and obligations. Contract modifications that are for goods or services that are not distinct from the existing contract, due to the significant integration with the original good or service provided, are accounted for as if they were part of that existing contract. The effect of a contract modification to an existing contract on the transaction price and our measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis. When the modifications include additional performance obligations that are distinct and at relative stand-alone selling price, they are accounted for as a new contract and performance obligation, which are recognized prospectively.

Contract balances are classified as assets or liabilities on a contract-by-contract basis at the end of each reporting period. The following table summarizes our contract assets and liabilities balances:

	June 30, 2021			March 31, 2021			Change
Contract assets	$	148,308		$	139,937		$	8,371
Contract liabilities		(240,080	)		(305,116	)		65,036
Net contract liability	$	(91,772	)	$	(165,179	)	$	73,407

The Company recognized revenue due to changes in estimates associated with performance obligations satisfied or partially satisfied in previous periods of $8,737. The change in contract assets is the result of revenue recognized in excess of amounts billed during the three months ended June 30, 2021. The change in contract liabilities is the result of revenue recognized in excess of the receipt of additional customer advances during the three months ended June 30, 2021. For the three months ended June 30, 2021, the Company recognized $40,133 of revenue that was included in the contract liability balance at the beginning of the period. Noncurrent contract assets presented in other, net on the accompanying condensed consolidated balance sheets as of June 30, 2021 and March 31, 2021, were $4,190 and $5,299, respectively. Noncurrent contract liabilities presented in other noncurrent liabilities on the accompanying condensed consolidated balance sheets as of June 30, 2021 and March 31, 2021, were $81,828 and $100,737, respectively.

Performance Obligations

Customers generally contract with the Company for requirements in a segment relating to a specific program, and the Company’s performance obligations consist of a wide range of engineering design services and manufactured components, as well as spare parts and repairs for OEMs. A single contract may contain multiple performance obligations consisting of both recurring and nonrecurring elements.

As of June 30, 2021, the Company has the following unsatisfied, or partially unsatisfied, performance obligations that are expected to be recognized in the future as noted in the table below. The Company expects options to be exercised in addition to the amounts presented below.

	Total		Less than 1 year		1-3 years		4-5 years		More than 5 years
Unsatisfied performance obligations	$	1,753,009	$	1,040,320	$	681,418	$	15,462	$	15,809