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Revenue Recognition and Contract Balances
 12 Months Ended
Jan. 01, 2023
Revenue from Contract with Customer [Abstract]  
Revenue Recognition and Contract Balances Revenue Recognition and Contract Balances
The Company disaggregates its revenue from contracts with customers by customer type and geographic region for each of our segments, as the Company believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors. With the exception of the Engineered Systems segment, net sales in each of our segments is primarily derived from fixed-price contracts. Net sales in the Engineered Systems segment are typically between 45% and 55% fixed-price contracts in a given reporting period, with the balance of net sales related to cost-reimbursable type contracts. For 2022, 2021 and 2020, approximately 49%, 47%, and 53% of net sales in the Engineered Systems segment was derived from fixed-price contracts.
Fiscal Year Ended
January 1, 2023		Fiscal Year Ended
January 1, 2023
Customer TypeGeographic Region (c)
(in millions)U.S. Govt. (a)Other (b)TotalUnited StatesEuropeAsiaAll otherTotal
Net sales:
Digital Imaging$619.1 $2,491.8 $3,110.9 $1,416.6 $749.7 $637.8 $306.8 $3,110.9 
Instrumentation108.1 1,145.9 1,254.0 554.5 311.5 267.1 120.9 1,254.0 
Aerospace and Defense Electronics266.3 416.1 682.4 494.6 96.1 65.3 26.4 682.4 
Engineered Systems366.4 44.9 411.3 406.9 — 1.3 3.1 411.3 
Total$1,359.9 $4,098.7 $5,458.6 $2,872.6 $1,157.3 $971.5 $457.2 $5,458.6 
(a) U.S. Government sales include sales as a prime contractor or subcontractor.
(b) Primarily commercial sales
(c) Geographic region by destination
Fiscal Year Ended
January 2, 2022		Fiscal Year Ended
January 2, 2022
Customer TypeGeographic Region (c)
(in millions)U.S. Govt. (a)Other (b)TotalUnited StatesEuropeAsiaAll otherTotal
Net sales:
Digital Imaging$515.9 $1,897.0 $2,412.9 $1,082.6 $567.8 $510.3 $252.2 $2,412.9 
Instrumentation91.6 1,075.3 1,166.9 512.6 298.5 247.5 108.3 1,166.9 
Aerospace and Defense Electronics227.2 401.5 628.7 469.0 92.1 48.6 19.0 628.7 
Engineered Systems358.4 47.4 405.8 402.2 0.1 1.5 2.0 405.8 
Total$1,193.1 $3,421.2 $4,614.3 $2,466.4 $958.5 $807.9 $381.5 $4,614.3 
(a) U.S. Government sale include sales as a prime contractor or subcontractor.
(b) Primarily commercial sales
(c) Geographic region by destination
Fiscal Year Ended
January 3, 2021		Fiscal Year Ended
January 3, 2021
Customer TypeGeographic Region (c)
(in millions)U.S. Govt. (a)Other (b)TotalUnited StatesEuropeAsiaAll otherTotal
Net sales:
Digital Imaging$120.9 $865.1 $986.0 $387.0 $245.2 $310.7 $43.1 $986.0 
Instrumentation80.6 1,013.9 1,094.5 471.1 279.2 238.9 105.3 1,094.5 
Aerospace and Defense Electronics229.9 359.5 589.4 429.4 92.4 46.6 21.0 589.4 
Engineered Systems386.8 29.5 416.3 413.4 0.1 1.4 1.4 416.3 
Total$818.2 $2,268.0 $3,086.2 $1,700.9 $616.9 $597.6 $170.8 $3,086.2 
(a) U.S. Government sales include sales as a prime contractor or subcontractor.
(b) Primarily commercial sales
(c) Geographic region by destination

For over time contracts using the cost-to-cost method, the Company has an Estimate at Completion (“EAC”) process in which management reviews the progress and execution of our performance obligations. This EAC process requires management judgment relative to assessing risks, estimating contract revenue, determining reasonably dependable cost estimates, and making assumptions for schedule and technical issues. Since certain contracts extend over a longer period of time, the impact of revisions in cost and revenue estimates during the progress of work may adjust the current period earnings through a cumulative catch-up basis. This method recognizes, in the current period, the cumulative effect of the changes on current and prior quarters. Additionally, if the current contract estimate indicates a loss, a provision is made for the total anticipated loss in the period that it becomes evident. Contract cost and revenue estimates for significant contracts are generally reviewed and reassessed quarterly. The majority of revenue recognized over time uses an EAC process. The net aggregate effects of these changes in estimates on contracts accounted for under the cost-to-cost method in 2022 and 2021 was approximately $29.9 million of favorable operating income and $26.8 million favorable operating income, respectively, with both years primarily related to favorable changes in estimates that impacted revenue, and, to a lesser degree, cost of sales within the Digital Imaging operating segment. None of the effects of changes in estimates on any individual contract were material to the consolidated statements of income for any period presented.
Remaining performance obligations represent the transaction price of firm orders for which work has not been performed as of the period end date and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity). As of January 1, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $3,099.3 million. The Company expects approximately 76% of remaining performance obligations to be recognized into revenue within the next twelve months, with the remaining 24% recognized thereafter.
The unbilled receivable balance decreased from the beginning of the year by $41.4 million, or 13.1%, primarily due to achieving billing milestones on certain contracts within the Digital Imaging segment, including FLIR defense-related contracts. Contract liabilities decreased from the beginning of the year by $3.5 million, or 1.7% primarily due to the decrease in customer advances and credits in our Digital Imaging segment partially offset by an increase in customer advances in our Engineered Systems segment. The Company recognized revenue of $144.4 million during the year ended January 1, 2023 from contract liabilities that existed at the beginning of year.