RECENT ACCOUNTING PRONOUNCEMENTS

6 Months Ended

Jul. 04, 2015

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

18.    RECENT ACCOUNTING PRONOUNCEMENTS

In July 2015, new accounting guidance on accounting for inventory was issued, which requires entities to measure inventory at the lower of cost and net realizable value. This guidance is effective for interim and annual periods beginning on or after December 15, 2016. The Company is currently evaluating the impact of the adoption of the new accounting guidance on its financial statements.

In April 2015, new accounting guidance was issued which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance is effective for interim and annual periods beginning on or after December 15, 2015. The Company will reclassify the carrying value of its debt issuance costs from an asset to a liability upon adoption.

In January 2015, new accounting guidance was issued which removes the concept of extraordinary items from US GAAP. Under the existing guidance, an entity is required to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is of an unusual nature and occurs infrequently. This separate presentation (and corresponding earnings per share impact) will no longer be allowed. This guidance is effective for interim and annual periods beginning on or after December 15, 2015. Early adoption is permitted. The adoption of the new guidance will not affect the Company’s financial position, results of operations or cash flows.

In May 2014, new accounting guidance on the accounting for revenue recognition was issued, which requires entities to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance is effective for interim and annual periods beginning on or after December 15, 2016. Early adoption is not permitted. The Company is currently evaluating the impact of the adoption of the new guidance on its financial statements.