Property, Plant and Equipment

12 Months Ended

Dec. 31, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

The components of property, plant and equipment, net at December 31, 2015 and 2014 were as follows:

	2015			2014
Land and buildings	$	430.3		$	428.8
Machinery and equipment	1,741.4			1,735.3
Subtotal	$	2,171.7		$	2,164.1
Less allowances for depreciation	(1,393.9		)	(1,383.6		)
Property, Plant and Equipment, net	$	777.8		$	780.5

Total depreciation expense was $94.6 million, $115.5 million and $124.7 million in 2015, 2014 and 2013, respectively.

At December 31, 2013, property, plant and equipment, net included $63.3 million of capitalized software. During the fourth quarter of 2014, the Company transferred approximately $45 million of capitalized software from property, plant and equipment to intangible assets. Depreciation expense for capitalized software was $13.7 million and $23.1 million in 2014 and 2013, respectively.

During the fourth quarter of 2015, the Company wrote-off $9.7 million that remained in CIP after the related assets were placed into service. This item was identified during an examination of aged balances in the CIP account and 91% of the amount related to fiscal years prior to 2013. Net loss attributable to The Timken Company in 2015 included a charge of $9.7 million ($6.1 million, or $0.07 per share, after-tax) due to the correction of this error. Management of the Company concluded that the correction of this error in the fourth quarter of 2015 and the presence of this error in prior periods was immaterial to all periods presented.

In November 2013, the Company finalized the sale of its former manufacturing facility in Sao Paulo. The Company received approximately $30 million over a twenty-four month period, all of which was received as of December 31, 2015. The total costs of this transaction, including the net book value of the real estate and broker's commissions, were approximately $3 million. The Company began recognizing the gain on the sale of this site using the installment method. In the fourth quarter of 2013, the Company recognized a gain of $5.4 million ($5.4 million after tax). In the first quarter of 2014, the Company changed to the full accrual method of recognizing the gain after it had received 25% of the total sales value. As a result, the Company recognized the remaining gain of $22.6 million ($19.5 million after tax) related to this transaction during the first quarter of 2014.