2.2.0.25falsefalse0201 - Disclosure - Summary of Significant Accounting Policiestruefalsefalse1falsefalseUSDfalsefalse10/1/2010 - 3/31/2011 USD ($) USD ($) / shares $Oct-01-2010_Mar-31-2011http://www.sec.gov/CIK0000047518duration2010-10-01T00:00:002011-03-31T00:00:00USDStandardhttp://www.xbrl.org/2003/iso4217USDiso42170SharesStandardhttp://www.xbrl.org/2003/instancesharesxbrli0USDEPSDividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli0USDUSD$2true0us-gaap_GeneralPoliciesAbstractus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsefalsefalseOtherxbrli:stringItemTypestringNo definition available.falsefalseSummary of Significant Accounting Policies [Abstract]3false0us-gaap_SignificantAccountingPoliciesTextBlockus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalseverboselabel1falsefalsefalse00  <div align="left" style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">   <div align="justify" style="font-size: 10pt; margin-top: 0pt"><b></b> </div> <div align="left"> </div> <div align="justify" style="font-size: 10pt; margin-top: 0pt; text-indext: 4%"><b></b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><b>1. Summary of Significant Accounting Policies</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Basis of Presentation</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">Unless the context otherwise requires, the terms “Hill-Rom,” “we,” “our” and “us” refer to Hill-Rom Holdings, Inc. and our wholly-owned subsidiaries. The unaudited Condensed Consolidated Financial Statements appearing in this Quarterly Report on Form 10-Q should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our latest Annual Report on Form 10-K for the fiscal year ended September 30, 2010 (“2010 Form 10-K”) as filed with the U.S. Securities and Exchange Commission. The September 30, 2010 Condensed Consolidated Balance Sheet was derived from audited Consolidated Financial Statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. In the opinion of management, the Condensed Consolidated Financial Statements herein include all adjustments, consisting only of normal recurring adjustments, necessary to state fairly the financial position, results of operations and cash flows for the interim periods presented. Quarterly results are not necessarily indicative of annual results. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Principles of Consolidation</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The Condensed Consolidated Financial Statements include the accounts of Hill-Rom and its subsidiaries. All subsidiaries are wholly-owned as of March 31, 2011. During the first quarter of our fiscal 2011 we acquired the remaining 40 percent noncontrolling interest in our former joint venture (Note 3). Intercompany accounts and transactions have been eliminated in consolidation. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Use of Estimates</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported in these Condensed Consolidated Financial Statements including the accompanying notes. Actual results could differ from those estimates. Examples of such estimates include our accounts receivable reserves (Note 2), investments (Note 6), income taxes (Note 9), accrued warranties (Note 12) and accrued litigation and self insurance reserves (Note 14), among others. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Investment Securities</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">At March 31, 2011, investment securities consisted primarily of $11.3 million in AAA rated student loan auction rate securities (“ARS”). These securities are generally insured through the U.S. government’s Federal Family Education Loan Program, to the extent the borrowers meet certain prescribed criteria in their underlying lending practices. These securities are classified as available-for-sale and changes in their fair value are recorded in Accumulated Other Comprehensive Loss (“AOCL”). </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">We regularly evaluate all investments classified as available-for-sale for possible impairment based on current economic conditions, credit loss experience and other criteria. The evaluation of investments for impairment requires significant judgments to be made including (i) the identification of potentially impaired securities; (ii) the determination of their estimated fair value; (iii) the assessment of whether any decline in estimated fair value is other-than-temporary; and (iv) the likelihood of selling before recovery. If there is a decline in a security’s net realizable value that is other-than-temporary and we are not likely to sell before recovery, the decline is separated into the amount of impairment related to credit loss and the amount of impairment related to all other factors. The decline related to the credit loss is recognized in earnings, while the decline related to all other factors is recognized in AOCL. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Taxes Collected from Customers and Remitted to Governmental Units</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">Taxes assessed by a governmental authority that are directly imposed on a revenue producing transaction between us and our customers, including but not limited to sales taxes, use taxes and value added taxes, are accounted for on a net (excluded from revenues and costs) basis. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; "> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Income Taxes</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">We and our eligible domestic subsidiaries file a consolidated U.S. income tax return. Foreign operations file income tax returns in a number of jurisdictions. Deferred income taxes are computed using an asset and liability approach to reflect the net tax effects of temporary differences between the financial reporting carrying amounts of assets and liabilities and the corresponding income tax amounts. We have a variety of deferred tax assets in numerous tax jurisdictions. These deferred tax assets are subject to periodic assessment as to recoverability and if it is determined that it is more likely than not that the benefits will not be realized, valuation allowances are recognized. In evaluating whether it is more likely than not that we would recover these deferred tax assets, future taxable income, the reversal of existing temporary differences and tax planning strategies are considered. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">We believe that our estimates for the valuation allowances recorded against deferred tax assets are appropriate based on current facts and circumstances. Entering the fiscal year we had $28.5 million of valuation allowances on deferred tax assets, on a tax-effected basis, primarily related to foreign operating loss carryforwards and other tax attributes. It is possible that sustainable improvements in foreign earnings could result in a reconsideration of the need for these valuation allowances, resulting in the accelerated recognition of all or some portion of the previously unrecognized tax benefits. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">We account for uncertain income tax positions using a threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The difference between the tax benefit recognized in the financial statements for an uncertain income tax position and the tax benefit claimed in the tax return is referred to as an unrecognized tax benefit. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><u>Recently Issued Accounting Standards</u> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">There have been no significant changes to our assessment of the impact of recently issued accounting standards included in Note 1 of Notes to Consolidated Financial Statements in our 2010 Form 10-K except as noted below: </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">On October 1, 2010 we adopted the Financial Accounting Standard Board’s (“FASB”) revised authoritative guidance requiring entities to provide more information about sales of securitized financial assets and similar transactions, particularly if the seller retains some risk with respect to the assets. Our adoption of this guidance was prospective and did not have a material impact on our Condensed Consolidated Financial Statements. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">On October 1, 2010, we adopted the FASB’s revised authoritative guidance to improve financial reporting for companies involved with variable interest entities to provide more relevant and reliable information to users of financial statements. Our adoption of this guidance was prospective and did not have a material impact on our Condensed Consolidated Financial Statements. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; "> </div>  <!-- Begin Block Tagged NotefalsefalsefalsefalsefalseOtherus-types:textBlockItemTypestringThis element may be used to describe all significant accounting policies of the reporting entity.Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Principles Board Opinion (APB) -Number 22 -Paragraph 8 falsefalseSummary of Significant Accounting Policies12Summary of Significant Accounting PoliciesUnKnownUnKnownUnKnownUnKnownfalsetrue