Summary of Significant Accounting Policies (Tables)

12 Months Ended

Feb. 28, 2019

Disaggregated Revenue

Revenue by segment and geography is disclosed in Note 12. In addition, the following table presents disaggregated revenue by customer industry (in thousands):



	Year Ended
	February 28, 2019		February 28, 2018		February 28, 2017
Net sales:
Industrial - oil and gas, construction, and general	$	526,465	$	461,945	$	518,123
Transmission and distribution	212,433		194,503		164,072
Power generation	188,189		153,982		181,343
Total net sales	$	927,087	$	810,430	$	863,538

Property, Plant and Equipment

Depreciation is computed using the straight-line method over the estimated useful lives of the related assets as follows:



Buildings and structures	10-25 years
Machinery and equipment	3-15 years
Furniture and fixtures	3-15 years
Automotive equipment	3 years
Computers and software	3 years

Property, Plant and Equipment

Property, plant and equipment consisted of the following (in thousands):



	February 28, 2019			February 28, 2018
Land	$	21,677		$	22,445
Building and structures	156,447			152,191
Machinery and equipment	245,588			234,071
Furniture, fixtures, software and computers	27,075			25,316
Automotive equipment	3,766			3,432
Construction in progress	13,065			13,977
	467,618			451,432
Less accumulated depreciation	(257,391		)	(234,577		)
Net property, plant, and equipment	$	210,227		$	216,855

Schedule of Warranty Reserve

The following is a roll-forward of amounts accrued for warranties (in thousands):



Balance at February 29, 2016	$	2,915
Warranty costs incurred	(1,947		)
Additions charged to income	1,130
Balance at February 28, 2017	$	2,098
Warranty costs incurred	(2,225		)
Additions charged to income	2,140
Balance at February 28, 2018	$	2,013
Warranty costs incurred	(2,195		)
Additions charged to income	1,933
Balance at February 28, 2019	$	1,751

Schedule of New Accounting Pronouncements and Changes in Accounting Principles

The cumulative effect of initially applying ASC 606 was recorded as an adjustment to the opening balance of retained earnings, which impacted the consolidated balance sheet as follows:



Balance Sheet	February 28, 2018		ASC 606 Adjustments		March 1, 2018
Assets
Inventories	$	110,761	$	7,664	$	118,425
Liabilities and shareholders' equity
Contract liabilities	22,698		6,948		29,646
Retained Earnings	526,018		716		526,734

During the preparation of the consolidated financial statements for the year ended February 28, 2019, the Company identified an error related to the adoption of ASC 606. This impact was recorded as an out-of-period adjustment during the fourth quarter of fiscal year 2019, which increased net sales by $3.5 million, cost of good sold by $2.4 million and net income by $1.0 million. The disclosures above show the impact of this adjustment as of the adoption date on March 1, 2018. Management considered the impact on the previously issued financial statements and concluded that the adjustments were not material.

The adoption of ASC 606 had the following impact on the consolidated balance sheets and consolidated statements of income as of and for the fiscal year ended February 28, 2019:



Balance Sheet	As Reported		Balance Excluding ASC 606 Effects		Change
Assets
Inventories	$	124,847	$	119,627	$	5,220
Liabilities and shareholders' equity
Contract liabilities	56,928		53,444		3,484



Consolidated Statements of Income	As Reported		Balance Excluding ASC 606 Effects		Change
Net sales	$	927,087	$	923,623	$	3,464
Cost of goods sold	728,466		726,022		2,444
Gross profit	198,621		197,601		1,020
Operating income	76,956		75,936		1,020