Business Context and Reporting Period
Company: Ampco-Pittsburgh Corporation
Filing Type: Form 8-K (Current Report)
Date of Report: September 27, 2018
Subject: Adoption of Accounting Standards Update (ASU) 2017-07 regarding the presentation of net periodic pension and postretirement benefit costs.
Key Financial Metrics
This filing does not report current period revenue, profit, cash flow, or liquidity metrics. It details retrospective adjustments to historical financial statements due to a change in accounting presentation. The filing explicitly states that the guidance does not affect the Corporation's financial position or liquidity, nor does it change the total amount of net periodic benefit cost recognized.
| Year Ended Dec 31 | 2017 (Reported) | 2017 (Adjusted) | 2016 (Reported) | 2016 (Adjusted) | 2015 (Reported) | 2015 (Adjusted) |
|---|---|---|---|---|---|---|
| (Loss) Income from Operations ($000s) | $(9,369) | $(9,927) | $(54,530) | $(55,475) | $5,047 | $9,467 |
| Other Income (Expense) ($000s) | $(4,324) | $(3,766) | $(2,990) | $(2,045) | $(527) | $(4,947) |
| (Loss) Income Before Taxes ($000s) | $(13,693) | $(13,693) | $(57,520) | $(57,520) | $4,520 | $4,520 |
Material Changes Versus Prior Period
The filing reports a change in the presentation of financial data rather than a change in operational performance. Under ASU 2017-07:
- Service Cost: Moved to the same line item as other compensation costs within "Income from Operations."
- Other Components: Non-service cost components of net periodic benefit cost are now presented separately from service cost and outside the subtotal of income from operations.
- Impact on Net Income: There is no change to "Income (Loss) Before Income Taxes" for any of the years presented (2015, 2016, 2017) as the total cost recognized remains constant.
Guidance, Outlook, and Management Commentary
Management Commentary: Management concluded that the impact of the adoption was not material to the years ended December 31, 2017, 2016, and 2015. Consequently, historical statements for those years have not been revised in this filing. Retrospective adjustments will be applied for the year ending December 31, 2018, using amounts disclosed in pension footnotes as estimates.
Risks and Contingencies: The filing does not disclose new risks or contingencies. It notes that the amended guidance allows only the service cost component to be eligible for capitalization when applicable.
Important Facts for Investor Verification
- The filing is a non-cash accounting presentation change; it does not reflect new operational results or cash flow changes.
- Historical "Income from Operations" figures for 2015-2017 will appear different in future filings due to the reclassification of pension service costs.
- Net income before taxes remains unchanged by this accounting update.
- Investors should verify the specific line item reclassifications in the upcoming 2018 annual report to ensure consistency with the retrospective adjustments described here.