Summary Of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 29, 2014

Accounting Policies [Abstract]

Schedule of Error Corrections and Prior Period Adjustments

The aggregate impacts of correcting the errors relating to the Spain transaction as of and for the three and six months ended June 30, 2013 were as follows:

	Restatement Adjustments to Previously Reported Income Statement - Income/(Expense)
	Quarter (13 weeks) ended			Six months (26 weeks) ended
(amounts in millions)	June 30, 2013			June 30, 2013
Net revenues	$	—		$	(0.9	)
Operating income	—			(0.9		)
Interest expense	(0.5		)	(1.0		)
Income taxes expense	(0.1		)	(0.5		)
Net loss	(0.4		)	(1.5		)

The following tables compare our previously reported Consolidated Statements of Operations, Comprehensive Income (Loss), and Cash Flows for the three and six months ended June 30, 2013 to the corresponding financial statements for the quarterly period as restated.

CHECKPOINT SYSTEMS, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)

	Quarter Ended									Six months ended
	June 30, 2013									June 30, 2013
(amounts in thousands, except per share data)	As Previously Reported			Restatement Adjustments			As Restated in this Quarterly Report on Form 10-Q			As Previously Reported			Restatement Adjustments			As Restated in this Quarterly Report on Form 10-Q
Net revenues	$	172,018		$	272		$	172,290		$	320,853		$	(390	)	$	320,463
Cost of revenues	102,399			—			102,399			197,293			13			197,306
Gross profit	69,619			272			69,891			123,560			(403		)	123,157
Selling, general, and administrative expenses	56,850			365			57,215			112,137			603			112,740
Research and development	4,627			—			4,627			9,320			—			9,320
Restructuring expenses	1,629			—			1,629			3,645			—			3,645
Litigation settlement	—			—			—			(6,584		)	—			(6,584		)
Acquisition costs	280			—			280			441			—			441
Other operating income	(248		)	—			(248		)	(578		)	—			(578		)
Operating income	6,481			(93		)	6,388			5,179			(1,006		)	4,173
Interest income	405			—			405			804			—			804
Interest expense	2,822			508			3,330			4,881			1,013			5,894
Other gain (loss), net	(1,966		)	—			(1,966		)	(2,511		)	—			(2,511		)
Earnings (loss) from continuing operations before income taxes	2,098			(601		)	1,497			(1,409		)	(2,019		)	(3,428		)
Income taxes expense	784			(184		)	600			1,063			(463		)	600
Net earnings (loss) from continuing operations	1,314			(417		)	897			(2,472		)	(1,556		)	(4,028		)
Loss from discontinued operations, net of tax (benefit) expense of $(66) and $68	(14,329		)	—			(14,329		)	(16,885		)	—			(16,885		)
Net loss	(13,015		)	(417		)	(13,432		)	(19,357		)	(1,556		)	(20,913		)
Less: income attributable to non-controlling interests	59			—			59			1			—			1
Net loss attributable to Checkpoint Systems, Inc.	$	(13,074	)	$	(417	)	$	(13,491	)	$	(19,358	)	$	(1,556	)	$	(20,914	)
Basic loss attributable to Checkpoint Systems, Inc. per share:
Earnings (loss) from continuing operations	$	0.03		$	(0.01	)	$	0.02		$	(0.06	)	$	(0.04	)	$	(0.10	)
Loss from discontinued operations, net of tax	$	(0.35	)	$	—		$	(0.35	)	$	(0.41	)	$	—		$	(0.41	)
Basic loss attributable to Checkpoint Systems, Inc. per share	$	(0.32	)	$	(0.01	)	$	(0.33	)	$	(0.47	)	$	(0.04	)	$	(0.51	)
Diluted loss attributable to Checkpoint Systems, Inc. per share:
Earnings (loss) from continuing operations	$	0.03		$	(0.01	)	$	0.02		$	(0.06	)	$	(0.04	)	$	(0.10	)
Loss from discontinued operations, net of tax	$	(0.34	)	$	—		$	(0.34	)	$	(0.41	)	$	—		$	(0.41	)
Diluted loss attributable to Checkpoint Systems, Inc. per share	$	(0.31	)	$	(0.01	)	$	(0.32	)	$	(0.47	)	$	(0.04	)	$	(0.51	)

CHECKPOINT SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

	Quarter Ended									Six months ended
	June 30, 2013									June 30, 2013
(amounts in thousands)	As Previously Reported			Restatement Adjustments			As Restated in this Quarterly Report on Form 10-Q			As Previously Reported			Restatement Adjustments			As Restated in this Quarterly Report on Form 10-Q
Net loss	$	(13,015	)	$	(417	)	$	(13,432	)	$	(19,357	)	$	(1,556	)	$	(20,913	)
Other comprehensive loss, net of tax:
Amortization of pension plan actuarial losses, net of tax benefit of $113 and $221	273			—			273			555			—			555
Change in realized and unrealized losses on derivative hedges, net of tax benefit of $0 and $0	4			—			4			(153		)	—			(153		)
Foreign currency translation adjustment	(638		)	(358		)	(996		)	(3,979		)	384			(3,595		)
Total other comprehensive loss, net of tax	(361		)	(358		)	(719		)	(3,577		)	384			(3,193		)
Comprehensive loss	(13,376		)	(775		)	(14,151		)	(22,934		)	(1,172		)	(24,106		)
Less: comprehensive income (loss) attributable to non-controlling interests	53			—			53			(172		)	—			(172		)
Comprehensive loss attributable to Checkpoint Systems, Inc.	$	(13,429	)	$	(775	)	$	(14,204	)	$	(22,762	)	$	(1,172	)	$	(23,934	)

CHECKPOINT SYSTEMS, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

	Six months ended
	June 30, 2013
(amounts in thousands)	As Previously Reported			Restatement Adjustments			As Restated in this Quarterly Report on Form 10-Q
Cash flows from operating activities:
Net loss	$	(19,357	)	$	(1,556	)	$	(20,913	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	14,487			—			13,666
Amortization of debt issuance costs	—			—			821
Interest on financing liability	—			1,013			1,013
Deferred taxes	(305		)	(463		)	(768		)
Stock-based compensation	3,859			—			3,859
Provision for losses on accounts receivable	(522		)	—			(522		)
Excess tax benefit on stock compensation	(122		)	—			(122		)
Loss on disposal of fixed assets	375			—			375
Litigation settlement	(6,584		)	—			(6,584		)
Gain on sale of subsidiary	(248		)	—			(248		)
Loss on sale of discontinued operations	13,024			—			13,024
Restructuring-related asset impairment	731			—			731
Decrease (increase) in operating assets, net of the effects of acquired companies:
Accounts receivable	41,613			(4,305		)	37,308
Inventories	(2,456		)	(73		)	(2,529		)
Other current assets	2,690			(2,542		)	148
Increase (decrease) in operating liabilities, net of the effects of acquired companies:
Accounts payable	3,351			4,916			8,267
Income taxes	(2,329		)	—			(2,329		)
Unearned revenues - current	(7,007		)	3,167			(3,840		)
Restructuring reserve	(5,059		)	—			(5,059		)
Other liabilities	(19,182		)	(157		)	(19,339		)
Net cash provided by operating activities	16,959			—			16,959
Cash flows from investing activities:
Acquisition of property, plant, and equipment and intangibles	(3,310		)	—			(3,310		)
Cash proceeds from the sale of discontinued operations	1,290			—			1,290
Cash proceeds from the sale of subsidiary	227			—			227
Other investing activities	921			—			921
Net cash used in investing activities	(872		)	—			(872		)
Cash flows from financing activities:
Proceeds from stock issuances	1,545			—			1,545
Excess tax benefit on stock compensation	122			—			122
Proceeds from short-term debt	2,759			—			2,759
Payment of short-term debt	(2,561		)	—			(2,561		)
Net change in factoring and bank overdrafts	(339		)	—			(339		)
Payment of long-term debt	(10,113		)	—			(10,113		)
Net cash used by financing activities	(8,587		)	—			(8,587		)
Effect of foreign currency rate fluctuations on cash and cash equivalents	(3,204		)	—			(3,204		)
Net increase in cash and cash equivalents	4,296			—			4,296
Cash and cash equivalents:
Beginning of period	118,829			—			118,829
End of period	$	123,125		$	—		$	123,125

Schedule Of Movement Of Warranty Reserves

The following table sets forth the movement in the warranty reserve which is located in the Other Accrued Expenses section of our Consolidated Balance Sheets:

(amounts in thousands)
Six months ended	June 29, 2014			June 30, 2013
Balance at beginning of year	$	4,521		3,995
Accruals for warranties issued, net	2,232			2,531
Settlements made	(1,874		)	(2,019		)
Foreign currency translation adjustment	18			(125		)
Balance at end of period	$	4,897		$	4,382

Schedule of Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss), net of tax, for the six months ended June 29, 2014 were as follows:

(amounts in thousands)	Pension plan			Changes in realized and unrealized gains (losses) on derivative hedges		Foreign currency translation adjustment		Total accumulated other comprehensive income
Balance, December 29, 2013	$	(17,773	)	$	—	$	20,018	$	2,245
Other comprehensive income before reclassifications	177			—		698		875
Amounts reclassified from other comprehensive income	555			—		—		555
Net other comprehensive income	732			—		698		1,430
Balance, June 29, 2014	$	(17,041	)	$	—	$	20,716	$	3,675

Reclassification Out Of Accumulated Other Comprehensive Income (Loss)

The significant items reclassified from each component of other comprehensive income (loss) for the three months ended June 29, 2014 and June 30, 2013 were as follows:

(amounts in thousands)	June 29, 2014				June 30, 2013
Details about accumulated other comprehensive income (loss) components	Amount reclassified from accumulated other comprehensive income (loss)			Affected line item in the statement where net loss is presented	Amount reclassified from accumulated other comprehensive income (loss)			Affected line item in the statement where net loss is presented
Amortization of pension plan items
Actuarial loss (1)	$	(386	)		$	(386	)
Prior service cost (1)	(3		)		—
	(389		)	Total before tax	(386		)	Total before tax
	112			Tax benefit	113			Tax benefit
	$	(277	)	Net of tax	$	(273	)	Net of tax
Gains on cash flow hedges
Foreign currency revenue forecast contracts	$	—		Cost of revenues	$	(4	)	Cost of revenues
	—			Total before tax	(4		)	Total before tax
	—			Tax expense	—			Tax expense
	$	—		Net of tax	$	(4	)	Net of tax
Non-controlling interest
Sale of 51% interest in Sri Lanka subsidiary	$	—		Other operating income	$	(120	)	Other operating income
	—			Total before tax	(120		)	Total before tax
	—			Tax expense	—			Tax expense
	$	—		Net of tax	$	(120	)	Net of tax
Total reclassifications for the period	$	(277	)		$	(397	)

⁽¹⁾  These accumulated other comprehensive income components are included in the computation of net periodic pension costs. Refer to Note 9 of the Consolidated Financial Statements.

The significant items reclassified from each component of other comprehensive income (loss) for the six months ended June 29, 2014 and June 30, 2013 were as follows:

(amounts in thousands)	June 29, 2014				June 30, 2013
Details about accumulated other comprehensive income (loss) components	Amount reclassified from accumulated other comprehensive income (loss)			Affected line item in the statement where net loss is presented	Amount reclassified from accumulated other comprehensive income (loss)			Affected line item in the statement where net loss is presented
Amortization of pension plan items
Actuarial loss (1)	$	(771	)		$	(775	)
Prior service cost (1)	(6		)		(1		)
	(777		)	Total before tax	(776		)	Total before tax
	222			Tax benefit	221			Tax benefit
	$	(555	)	Net of tax	$	(555	)	Net of tax
Gains on cash flow hedges
Foreign currency revenue forecast contracts	$	—		Cost of revenues	$	153		Cost of revenues
	—			Total before tax	153			Total before tax
	—			Tax expense	—			Tax expense
	$	—		Net of tax	$	153		Net of tax
Non-controlling interest
Sale of 51% interest in Sri Lanka subsidiary	$	—		Other operating income	$	(120	)	Other operating income
	—			Total before tax	(120		)	Total before tax
	—			Tax expense	—			Tax expense
	$	—		Net of tax	$	(120	)	Net of tax
Total reclassifications for the period	$	(555	)		$	(522	)

⁽¹⁾  These accumulated other comprehensive income components are included in the computation of net periodic pension costs. Refer to Note 9 of the Consolidated Financial Statements.