CORRECTION OF PRIOR PERIOD ERROR

9 Months Ended

Sep. 30, 2012

AccountingChangesAndErrorCorrectionsAbstract

AccountingChangesAndErrorCorrectionsTextBlock

2.CORRECTION OF PRIOR PERIOD ERROR

During the third quarter of 2012, as part of a recent reorganization, the Corporation identified errors related to its long-term contract accountingpractices within a certain subsidiary in its Motion Control segment. The errors date back to periods prior to and including 2007 through 2011 and primarily relate to the untimely liquidation of certain labor-based inventory costs to Cost of sales resulting in an overstatement of retained earnings of $23 million at December 31, 2011. In addition, other errors primarily related to incorrect capitalization offixed assetswere also identified. The combined errors resulted in a cumulative overstatement in Retained earnings of $24 million at December 31, 2011 andprimarily impacted Net sales, Cost of sales, and the balance sheet accounts identified in the table below.

In accordance with FASB Accounting Standards Codification ("ASC") No. 250-10-S99 ("ASC 250-10-S99"), the Corporation evaluated these errors and, based on an analysis of quantitative and qualitative factors, determined that they were not material to any one of the prior reporting periods affected and, therefore, amendment of previously filed reports with the Securities and Exchange Commission is not required.

However, if the adjustments to correct the cumulative effect of the aforementioned errors had been recorded in the three and nine months ended September 30, 2012, the impact would have been material to those two periods. Therefore, in accordance with Staff Accounting Bulletin ("SAB") 108, the Corporation has restated the prior period financial statements included within this filing as summarized below.

The Condensed Consolidated Statements of Earnings for the three and nine months ended September 30, 2011, Condensed Consolidated Statements of Stockholders' Equity as of December 31, 2010 andfor the year ended December 31, 2011, and the accompanying Condensed Consolidated Balance Sheets as of December 31, 2011 have been restatedand retrospectively reclassified for the discontinued operations of the heat treating businessas discussed in Note 3 as follows:

For the three months ended September 30, 2011:

		(In thousands)
				Adjustments
		As previously reported		Corrections		Reclassification of discontinued operations		As reclassified and restated
Net sales		$	515,996	$	2,349	$	(9,225)	$	509,120
Cost of sales			345,359		2,167		(5,738)		341,788
Gross profit			170,637		182		(3,487)		167,332
Operating income			50,146		182		(4,221)		46,107
Earnings from continuing operations before
	income taxes		45,078		182		(4,221)		41,039
Provision for income taxes			10,718		49		(1,602)		9,165
Earnings from continuing operations			34,360		133		(2,619)		31,874
Earnings from discontinued operations			-		-		2,619		2,619
Net earnings			34,360		133		-		34,493
Basic earnings per share
	Earnings from continuing operations	$	0.74	$	-	$	(0.05)	$	0.69
	Earnings from discontinued operations		-		-		0.05		0.05
Total		$	0.74	$	-	$	-	$	0.74
Diluted earnings per share
	Earnings from continuing operations	$	0.73	$	-	$	(0.05)	$	0.68
	Earnings from discontinued operations		-		-		0.05		0.05
Total		$	0.73	$	-	$	-	$	0.73

For the nine months ended September 30, 2011:

		(In thousands)
				Adjustments
		As previously reported		Corrections		Reclassifications of discontinued operations		As reclassified and restated
Net sales		$	1,492,751	$	893	$	(27,377)	$	1,466,267
Cost of sales			1,004,188		4,252		(17,448)		990,992
Gross profit			488,563		(3,359)		(9,929)		475,275
Operating income			143,518		(3,359)		(9,476)		130,683
Earnings from continuing operations before
	income taxes		128,447		(3,359)		(9,484)		115,604
Provision for income taxes			37,775		(912)		(3,599)		33,264
Earnings from continuing operations			90,672		(2,447)		(5,885)		82,340
Earnings from discontinued operations			-		-		5,885		5,885
Net earnings			90,672		(2,447)		-		88,225
Basic earnings per share
	Earnings from continuing operations	$	1.96	$	(0.05)	$	(0.13)	$	1.78
	Earnings from discontinued operations		-		-		0.13		0.13
Total		$	1.96	$	(0.05)	$	-	$	1.91
Diluted earnings per share
	Earnings from continuing operations	$	1.93	$	(0.05)	$	(0.13)	$	1.75
	Earnings from discontinued operations		-		-		0.13		0.13
Total		$	1.93	$	(0.05)	$	-	$	1.88

In order to correct the cumulative impact of the errors on periods prior to 2011, the Corporation recorded an adjustment of $19 million to decrease December 31, 2010 retained earningsfrom $1,072 million to $1,053 million.In order to correct the impact of the error for the twelve months ended December 31, 2011 net earnings, included in the Condensed Consolidated Statements of Stockholder's Equity, the Corporation recorded an adjustment of $4 million to decrease net earnings from $130 million to $126 million.

The adjustments to the Corporation's December 31, 2011 Condensed Consolidated Balance Sheet are presented in the following table:

		(In thousands)
		As previously reported		Corrections		As restated
Condensed Consolidated Balance Sheet, December 31, 2011
	Receivables, net	$	556,026	$	(13,017)	$	543,009
	Inventories, net		320,633		(7,588)		313,045
	Other current assets		41,813		4,142		45,955
	Total current assets		1,167,134		(16,463)		1,150,671
	Property, plant, and equipment, net		443,555		(827)		442,728
	Total assets		2,652,837		(17,290)		2,635,547
	Deferred revenue		200,268		5,793		206,061
	Other current liabilities		42,976		865		43,841
	Total current liabilities		505,384		6,658		512,042
	Total liabilities		1,423,798		6,658		1,430,456
	Retained earnings		1,187,989		(23,948)		1,164,041
	Total stockholders' equity		1,229,039		(23,948)		1,205,091
	Total liabilities and stockholders' equity		2,652,837		(17,290)		2,635,547

The correction of the errors to the Corporation's Condensed Consolidated Statement of Cash flows for the nine months ended September 30, 2011 did not impact the net increase or decrease in cash and cash equivalents for any period. The adjustments to the Corporation's Condensed Consolidated Statement of Cash Flows are presented in the following table:

			(In thousands)
			Nine Months Ended
			September 30, 2011
			As previously reported		Corrections		As restated
Net earnings			$	90,672	$	(2,447)	$	88,225
Adjustments to reconcile net earnings to net cash
	provided by operating activities:
	Changes in operating assets and liabilities, net of businesses acquired:
		Accounts receivable, net		(80,416)		3,506		(76,910)
		Inventories, net		(31,482)		(1,590)		(33,072)
		Deferred revenue		21,587		(1,493)		20,094
		Other current and long-term assets and liabilities		8,912		1,088		10,000
Net cash provided by operating activities				53,758		(936)		52,822
Cash flows from investing activities:
	Additions to property, plant, and equipment			(61,232)		936		(60,296)
Net cash used for investing activities				(183,915)		936		(182,979)