2.2.0.25falsefalse0202 - Disclosure - Summary of Significant Accounting Policiestruefalsefalse1falsefalseUSDfalsefalse1/1/2010 - 12/31/2010
USD ($)
USD ($) / shares
$Jan-01-2010_Dec-31-2010http://www.sec.gov/CIK0000105634duration2010-01-01T00:00:002010-12-31T00:00:00USDStandardhttp://www.xbrl.org/2003/iso4217USDiso42170USDEPSDividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli0USDUSD$2true0us-gaap_GeneralPoliciesAbstractus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsefalsefalseOtherxbrli:stringItemTypestringNo definition available.falsefalse3false0us-gaap_SignificantAccountingPoliciesTextBlockus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalseverboselabel1falsefalsefalse00<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
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<td>
<b><font style="font-family: 'Times New Roman', Times">NOTE 2—</font></b>
</td>
<td>
<b><font style="font-family: 'Times New Roman', Times">SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES</font></b>
</td>
</tr>
</table>
<div style="margin-top: 18pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Principles
of Consolidation</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
The consolidated financial statements include the accounts of
the Company and its majority-owned subsidiaries. Significant
intercompany accounts and transactions have been eliminated. All
investments over which we exercise significant influence, but do
not control (a 20% to 50% ownership interest), are accounted for
using the equity method of accounting. Additionally, we
participate in a joint venture with another company, and we have
consolidated this joint venture as we have determined that
through our participation we have a variable interest and are
the primary beneficiary as defined by the Financial Accounting
Standards Board (“FASB”) Accounting Standard
Codification (“ASC”) Topic 810,
“Consolidation”.
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
For joint ventures that have been accounted for using the
consolidation method of accounting, noncontrolling interest
represents the allocation of earnings to our joint venture
partners who either have a minority-ownership interest in the
joint venture or are not at risk for the majority of losses of
the joint venture.
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
The results of operations of companies acquired have been
included in the results of operations from the date of the
respective acquisition.
</div>
<div style="margin-top: 18pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Principles
of Preparation</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
The preparation of the consolidated financial statements, in
conformity with accounting principles generally accepted in the
United States, requires us to make estimates and assumptions
that affect the reported amounts of assets and liabilities at
the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could
materially differ from those estimates.
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Our reportable segments reflect certain reclassifications of
prior year amounts from our United States mechanical
construction and facilities services segment to our United
States facilities services segment due to changes in our
internal reporting structure.
</div>
<div style="margin-top: 18pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Revenue
Recognition</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Revenues from long-term construction contracts are recognized on
the
<font style="white-space: nowrap">percentage-of-completion</font>
method in accordance with ASC Topic
<font style="white-space: nowrap">605-35,</font>
“Revenue Recognition—Construction-Type and
Production-Type Contracts”.
<font style="white-space: nowrap">Percentage-of-completion</font>
is measured principally by the percentage of costs incurred to
date for each contract to the estimated total costs for such
contract at completion. Certain of our electrical contracting
business units and our Canadian subsidiary measure
<font style="white-space: nowrap">percentage-of-completion</font>
by the percentage of labor costs incurred to date for each
contract to the estimated total labor costs for such contract.
Revenues from the performance of facilities services for
maintenance, repair and retrofit work are recognized consistent
with the performance of services, which are generally on a
pro-rata basis over the life of the contractual arrangement.
Expenses related to all services arrangements are recognized as
incurred. Revenues related to the engineering, manufacturing and
repairing of shell and tube heat exchangers are recognized when
the product is shipped and all other revenue recognition
criteria have been met. Costs related to this work are included
in inventory until the product is shipped. These costs include
all direct material, labor and subcontracting costs and indirect
costs related to performance such as supplies, tools and
repairs. Provisions for the entirety of estimated losses on
uncompleted contracts are made in the period in which such
losses are determined. In the case of customer change orders for
uncompleted long-term construction contracts, estimated
recoveries are included for work performed in forecasting
ultimate profitability on certain contracts. Due to
uncertainties inherent in the estimation process, it is possible
that completion costs, including those arising from contract
penalty provisions and final contract settlements, will be
revised in the near-term. Such revisions to costs and income are
recognized in the period in which the revisions are determined.
</div>
<div style="margin-top: 18pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Costs and
estimated earnings on uncompleted contracts</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Costs and estimated earnings in excess of billings on
uncompleted contracts arise in the consolidated balance sheets
when revenues have been recognized but the amounts cannot be
billed under the terms of the contracts. Such amounts are
recoverable from customers upon various measures of performance,
including achievement of certain milestones, completion of
specified units, or completion of a contract. Also included in
costs and estimated earnings on uncompleted contracts are
amounts we seek or will seek to collect from customers or others
for errors or changes in contract specifications or design,
contract change orders in dispute or unapproved as to both scope
<font style="white-space: nowrap">and/or</font> price
or other customer-related causes of unanticipated additional
contract costs (claims and unapproved change orders). Such
amounts are recorded at estimated net realizable value when
realization is probable and can be reasonably estimated. No
profit is recognized on construction costs incurred in
connection with claim amounts. Claims and unapproved change
orders made by us involve negotiation and, in certain cases,
litigation. In the event litigation costs are incurred by us in
connection with claims or unapproved change orders, such
litigation costs are expensed as incurred, although we may seek
to recover these costs. We believe that we have established
legal bases for pursuing recovery of our recorded unapproved
change orders and claims, and it is management’s intention
to pursue and litigate such claims, if necessary, until a
decision or settlement is reached. Unapproved change orders and
claims also involve the use of estimates, and it is reasonably
possible that revisions to the estimated recoverable amounts of
recorded claims and unapproved change orders may be made in the
near term. If we do not successfully resolve these matters, a
net expense (recorded as a reduction in revenues) may be
required, in addition to amounts that may have been previously
provided for. We record the profit associated with the
settlement of claims upon receipt of final payment. Claims
against us are recognized when a loss is considered probable and
amounts are reasonably determinable.
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<b>
<font style="font-family: 'Times New Roman', Times">
<font style="font-size: 10pt">
</font>
</font>
</b>
</div>
<div style="margin-top: 0pt; font-size: 1pt">
</div>
<div style="margin-top: 0pt; font-size: 1pt">
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
</div>
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<tr>
<td width="9%"></td>
<td width="91%"></td>
</tr>
<tr valign="top">
<td>
<b>
<font style="font-family: 'Times New Roman', Times">
</font>
</b>
</td>
<td>
<b>
<font style="font-family: 'Times New Roman', Times">
</font>
</b>
</td>
</tr>
</table>
<!-- XBRL Pagebreak End -->
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Costs and estimated earnings on uncompleted contracts and
related amounts billed as of December 31, 2010 and 2009
were as follows (in thousands):
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<table border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent; text-align: left">
<!-- Table Width Row BEGIN -->
<tr style="font-size: 1pt" valign="bottom">
<td width="77%"> </td><!-- colindex=01 type=maindata -->
<td width="2%"> </td><!-- colindex=02 type=gutter -->
<td width="1%" align="right"> </td><!-- colindex=02 type=lead -->
<td width="7%" align="right"> </td><!-- colindex=02 type=body -->
<td width="1%" align="left"> </td><!-- colindex=02 type=hang1 -->
<td width="3%"> </td><!-- colindex=03 type=gutter -->
<td width="1%" align="right"> </td><!-- colindex=03 type=lead -->
<td width="7%" align="right"> </td><!-- colindex=03 type=body -->
<td width="1%" align="left"> </td><!-- colindex=03 type=hang1 -->
</tr>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<tr style="font-size: 8pt" valign="bottom" align="center">
<td nowrap="nowrap" align="center" valign="bottom">
 
</td>
<td>
 
</td>
<td colspan="2" nowrap="nowrap" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
<b>2010</b>
</td>
<td>
 
</td>
<td>
 
</td>
<td colspan="2" nowrap="nowrap" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
<b>2009</b>
</td>
<td>
 
</td>
</tr>
<tr style="line-height: 3pt; font-size: 1pt">
<td> 
</td>
</tr>
<!-- TableOutputBody -->
<tr valign="bottom" style="background: #cceeff">
<td align="left" valign="bottom">
<div style="text-indent: -10pt; margin-left: 10pt">
Costs incurred on uncompleted contracts
</div>
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
7,274,211
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
8,156,428
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
</tr>
<tr valign="bottom">
<td align="left" valign="bottom">
<div style="text-indent: -10pt; margin-left: 10pt">
Estimated earnings, thereon
</div>
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
811,651
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
795,407
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
</tr>
<tr valign="bottom" style="font-size: 1pt">
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td>
 
</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
8,085,862
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
8,951,835
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
</tr>
<tr valign="bottom">
<td align="left" valign="bottom">
<div style="text-indent: -10pt; margin-left: 10pt">
Less: billings to date
</div>
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
8,454,299
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
9,388,027
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
</tr>
<tr valign="bottom" style="font-size: 1pt">
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td>
 
</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
(368,437
</td>
<td nowrap="nowrap" align="left" valign="bottom">
)
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
(436,192
</td>
<td nowrap="nowrap" align="left" valign="bottom">
)
</td>
</tr>
<tr valign="bottom" style="font-size: 1pt">
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td>
 
</td>
</tr>
</table>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Such amounts were included in the accompanying Consolidated
Balance Sheets at December 31, 2010 and 2009 under the
following captions (in thousands):
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<table border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent; text-align: left">
<!-- Table Width Row BEGIN -->
<tr style="font-size: 1pt" valign="bottom">
<td width="79%"> </td><!-- colindex=01 type=maindata -->
<td width="2%"> </td><!-- colindex=02 type=gutter -->
<td width="1%" align="right"> </td><!-- colindex=02 type=lead -->
<td width="6%" align="right"> </td><!-- colindex=02 type=body -->
<td width="1%" align="left"> </td><!-- colindex=02 type=hang1 -->
<td width="3%"> </td><!-- colindex=03 type=gutter -->
<td width="1%" align="right"> </td><!-- colindex=03 type=lead -->
<td width="6%" align="right"> </td><!-- colindex=03 type=body -->
<td width="1%" align="left"> </td><!-- colindex=03 type=hang1 -->
</tr>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<tr style="font-size: 8pt" valign="bottom" align="center">
<td nowrap="nowrap" align="center" valign="bottom">
 
</td>
<td>
 
</td>
<td colspan="2" nowrap="nowrap" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
<b>2010</b>
</td>
<td>
 
</td>
<td>
 
</td>
<td colspan="2" nowrap="nowrap" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
<b>2009</b>
</td>
<td>
 
</td>
</tr>
<tr style="line-height: 3pt; font-size: 1pt">
<td> 
</td>
</tr>
<!-- TableOutputBody -->
<tr valign="bottom" style="background: #cceeff">
<td align="left" valign="bottom">
<div style="text-indent: -10pt; margin-left: 10pt">
Costs and estimated earnings in excess of billings on
uncompleted contracts
</div>
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
88,253
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
90,049
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
</tr>
<tr valign="bottom">
<td align="left" valign="bottom">
<div style="text-indent: -10pt; margin-left: 10pt">
Billings in excess of costs and estimated earnings on
uncompleted contracts
</div>
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
(456,690
</td>
<td nowrap="nowrap" align="left" valign="bottom">
)
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td nowrap="nowrap" align="right" valign="bottom">
(526,241
</td>
<td nowrap="nowrap" align="left" valign="bottom">
)
</td>
</tr>
<tr valign="bottom" style="font-size: 1pt">
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td style="border-top: 1px solid #000000">
 
</td>
<td>
 
</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td nowrap="nowrap" align="left" valign="bottom">
 
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
(368,437
</td>
<td nowrap="nowrap" align="left" valign="bottom">
)
</td>
<td>
 
</td>
<td nowrap="nowrap" align="left" valign="bottom">
$
</td>
<td nowrap="nowrap" align="right" valign="bottom">
(436,192
</td>
<td nowrap="nowrap" align="left" valign="bottom">
)
</td>
</tr>
<tr valign="bottom" style="font-size: 1pt">
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td>
 
</td>
<td>
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td style="border-top: 3px double #000000">
 
</td>
<td>
 
</td>
</tr>
</table>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
As of December 31, 2010 and 2009, costs and estimated
earnings in excess of billings on uncompleted contracts included
unbilled revenues for unapproved change orders of approximately
$9.3 million and $11.2 million, respectively, and
claims of approximately $6.3 million and $4.9 million,
respectively. In addition, accounts receivable as of
December 31, 2010 and 2009 included claims of approximately
$1.8 million and $2.5 million, respectively, plus
contractually billed amounts related to such contracts of
$42.7 million and $29.6 million, respectively.
Generally, contractually billed amounts will not be paid by the
customer to us until final resolution of related claims.
</div>
<div style="margin-top: 18pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Classification
of Contract Amounts</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
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In accordance with industry practice, we classify as current all
assets and liabilities related to the performance of long-term
contracts. The contracting cycle for certain long-term contracts
may extend beyond one year, and, accordingly, collection or
payment of amounts related to these contracts may extend beyond
one year. Accounts receivable at December 31, 2010 and 2009
included $212.9 million and $221.0 million,
respectively, of retainage billed under terms of these
contracts. We estimate that approximately 81% of retainage
recorded at December 31, 2010 will be collected during
2011. Accounts payable at December 31, 2010 and 2009
included $36.5 million and $38.6 million,
respectively, of retainage withheld under terms of the
contracts. We estimate that approximately 82% of retainage
withheld at December 31, 2010 will be paid during 2011.
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<i><font style="font-family: 'Times New Roman', Times">Cash and
cash equivalents</font></i>
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
For purposes of the consolidated financial statements, we
consider all highly liquid instruments with original maturities
of three months or less to be cash equivalents. We maintain a
centralized cash management system whereby our excess cash
balances are invested in high quality, short-term money market
instruments, which are considered cash equivalents. We have cash
balances in certain of our domestic bank accounts that exceed
federally insured limits.
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<i><font style="font-family: 'Times New Roman', Times">Allowance
for Doubtful Accounts</font></i>
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Accounts receivable are recorded at the invoiced amount and do
not bear interest. The Company maintains an allowance for
doubtful accounts. This allowance is based upon the best
estimate of the probable losses in existing accounts receivable.
The Company determines the allowances based upon individual
accounts when information indicates the customers may have an
inability to meet the financial obligation, as well as
historical collection and write-off experience. These amounts
are reevaluated and adjusted on a regular basis as additional
information is received. Actual write-offs are charged against
the allowance when collection efforts have been unsuccessful. At
December 31, 2010 and 2009, our accounts receivable of
$1,090.9 million and $1,057.2 million, respectively,
included allowances for doubtful accounts of $17.3 million
and $36.2 million, respectively. The (recovery of)
provision for doubtful accounts during 2010, 2009 and 2008
amounted to approximately $(5.1) million, $7.2 million
and $11.7 million, respectively.
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<i><font style="font-family: 'Times New Roman', Times">Inventories</font></i>
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Inventories are stated at the lower of cost or market. Cost is
determined principally using the average cost method.
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<i><font style="font-family: 'Times New Roman', Times">Property,
plant and equipment</font></i>
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<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Property, plant and equipment is stated at cost. Depreciation,
including amortization of assets under capital leases, is
recorded principally using the straight-line method over
estimated useful lives of 3 to 10 years for machinery and
equipment, 3 to 7 years for vehicles, furniture and
fixtures and computer hardware/software and 25 years for
buildings. Leasehold improvements are amortized over the shorter
of the remaining life of the lease term or the expected service
life of the improvement.
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
The carrying values of property, plant and equipment are
reviewed for impairment whenever facts and circumstances
indicate that the carrying amount may not be fully recoverable.
In performing this review for recoverability, property, plant
and equipment is assessed for possible impairment by comparing
their carrying values to their undiscounted net pre-tax cash
flows expected to result from the use of the asset. Impaired
assets are written down to their fair values, generally
determined based on their estimated future discounted cash
flows. Based on the results of our testing for the years ended
December 31, 2010, 2009 and 2008, no impairment of
property, plant and equipment was recognized.
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<i><font style="font-family: 'Times New Roman', Times">Goodwill
and Identifiable Intangible Assets</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Goodwill and other identifiable intangible assets with
indefinite lives that are not being amortized, such as trade
names, are instead tested at least annually for impairment
(which we test each October 1, absent any impairment
indicators) and are written down if impaired. Identifiable
intangible assets with finite lives are amortized over their
useful lives and are reviewed for impairment whenever facts and
circumstances indicate that their carrying values may not be
fully recoverable. See Note 8—Goodwill and
Identifiable Intangible Assets of the notes to consolidated
financial statements for additional information.
</div>
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<i><font style="font-family: 'Times New Roman', Times">Insurance
Liabilities</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
Our insurance liabilities are determined actuarially based on
claims filed and an estimate of claims incurred but not yet
reported. At December 31, 2010 and 2009, the estimated
current portion of undiscounted insurance liabilities of
$21.8 million and $20.5 million, respectively, were
included in “Other accrued expenses and liabilities”
in the accompanying Consolidated Balance Sheets. The estimated
non-current portion of the undiscounted insurance liabilities
included in “Other long-term obligations” at
December 31, 2010 and 2009 were $98.5 million and
$93.6 million, respectively.
</div>
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<i><font style="font-family: 'Times New Roman', Times">Foreign
Operations</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
</div>
<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
The financial statements and transactions of our foreign
subsidiaries are maintained in their functional currency and
translated into U.S. dollars in accordance with ASC Topic
830, “Foreign Currency Matters”. Translation
adjustments have been recorded as “Accumulated other
comprehensive loss”, a separate component of
“Equity”.
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<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Income
Taxes</font></i>
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<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
We account for income taxes in accordance with the provisions of
ASC Topic 740, “Income Taxes”
(“ASC 740”). ASC 740 requires an asset and
liability approach which requires the recognition of deferred
income tax assets and deferred income tax liabilities for the
expected future tax consequences of temporary differences
between the carrying amounts and the tax bases of assets and
liabilities. Valuation allowances are established when necessary
to reduce deferred income tax assets when it is more likely than
not that a tax benefit will not be realized.
</div>
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We account for uncertain tax positions in accordance with the
provisions of ASC 740. We recognize accruals of interest
related to unrecognized tax benefits as a component of the
income tax provision.
</div>
<div style="margin-top: 18pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">
<i><font style="font-family: 'Times New Roman', Times">Valuation
of Share-Based Compensation Plans</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
We have various types of share-based compensation plans and
programs, which are administered by our Board of Directors or
its Compensation and Personnel Committee. See
Note 14—Share-Based Compensation Plans of the notes to
consolidated financial statements for additional information
regarding the share-based compensation plans and programs.
</div>
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We account for share-based payments in accordance with the
provision of ASC Topic 718, “Compensation—Stock
Compensation” (“ASC 718”). ASC 718 requires
that all share-based payments issued to acquire goods or
services, including grants of employee stock options, be
recognized in the statement of operations based on their fair
values, net of estimated forfeitures. ASC 718 requires
forfeitures to be estimated at the time of grant and revised, if
necessary, in subsequent periods if actual forfeitures differ
from those estimates. Compensation expense related to
share-based awards is recognized over the requisite service
period, which is generally the vesting period. For shares
subject to graded vesting, our policy is to apply the
straight-line method in recognizing compensation expense.
ASC 718 requires the benefits of tax deductions in excess
of recognized compensation expense to be reported as a financing
cash inflow, rather than as an operating cash inflow on the
Consolidated Statements of Cash Flows. This requirement reduces
net operating cash flows and increases net financing cash flows.
</div>
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<i><font style="font-family: 'Times New Roman', Times">New
Accounting Pronouncements</font></i>
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
On January 1, 2010, we adopted the accounting pronouncement
regarding the consolidation of variable interest entities, which
changes the consolidation guidance related to a variable
interest entity (“VIE”). It also amends the guidance
governing the determination of whether or not an enterprise is
the primary beneficiary of a VIE and, if so, is therefore
required to consolidate an entity, by requiring a qualitative
analysis rather than a quantitative analysis. The qualitative
analysis will include, among other things, consideration of who
has the power to direct the activities of the entity that most
significantly impact the entity’s economic performance and
who has the obligation to absorb the losses or the right to
receive the benefits of the VIE that could potentially be
significant to the VIE. This statement also requires periodic
reassessments of whether an enterprise is the primary
beneficiary of a VIE. We were previously required to reconsider
whether an enterprise is the primary beneficiary of a VIE only
when specific events had occurred. This pronouncement also
requires enhanced disclosures about an enterprise’s
involvement with a VIE. The adoption of this pronouncement did
not have any effect on our consolidated financial statements.
</div>
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
In October 2009, an accounting pronouncement was issued to
update existing guidance on revenue recognition for arrangements
with multiple deliverables. This guidance eliminates the
requirement that all undelivered elements must have objective
and reliable evidence of fair value before a company can
recognize the portion of the consideration attributed to the
delivered item. This may allow some companies to recognize
revenue on transactions that involve multiple deliverables
earlier than under current requirements. Additional disclosures
discussing the nature of multiple element arrangements, the
types of deliverables under the arrangements, the general timing
of their delivery, and significant factors and estimates used to
determine estimated selling prices are required. This
pronouncement is effective prospectively for revenue
arrangements entered into or modified after annual periods
beginning on or after June 15, 2010, but early adoption is
permitted. We have adopted this pronouncement as of
January 1, 2011, and we will review new
<font style="white-space: nowrap">and/or</font>
modified revenue arrangements after the adoption date to ensure
compliance with this update. We have
not determined the effect, if any, that the adoption of the
pronouncement may have on our financial position
<font style="white-space: nowrap">and/or</font>
results of operations.
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<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
In December 2010, an accounting pronouncement was issued to
update existing guidance on business combinations, which
clarifies that if comparative financial statements are
presented, the pro forma revenue and earnings of the combined
entity for the comparable prior reporting period should be
reported as though the acquisition date for all business
combinations that occurred during the current year had been as
of the beginning of the comparable prior annual reporting
period. The guidance is effective prospectively for business
combinations for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or
after December 15, 2010. Early adoption is permitted. We
have adopted this pronouncement as of January 1, 2011, and
we will consider the guidance in conjunction with future
acquisitions.
</div>
<div style="margin-top: 6pt; font-size: 1pt"> 
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<div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
In December 2010, an accounting pronouncement was issued to
update existing guidance, which modifies the goodwill impairment
test for reporting units with zero or negative carrying amounts.
For reporting units with zero or negative carrying amounts, the
second step of the goodwill impairment test must be performed if
it appears more likely than not that a goodwill impairment
exists. To make that determination, an entity should consider
whether there are adverse qualitative factors indicating that an
impairment may exist. The guidance is effective for fiscal years
beginning after December 15, 2010. We have adopted this
pronouncement as of January 1, 2011, and we will consider
the guidance in conjunction with our future goodwill impairment
testing.
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