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1. Organization, Consolidation and Presentation of Financial Statements | 9 Months Ended
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Sep. 30, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Organization, Consolidation and Presentation of Financial Statements Disclosure | 1.BASIS OF PRESENTATION AND USE OF ESTIMATES Basis of Presentation In this report, “Bio-Rad,” “we,” “us,” "the Company" and “our” refer to Bio-Rad Laboratories, Inc. and its subsidiaries. The accompanying unaudited condensed consolidated financial statements of Bio-Rad have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and reflect all adjustments which are, in the opinion of management, necessary to fairly state the results of the interim periods presented. All such adjustments are of a normal recurring nature, with the exception to the adjustments noted below. Results for the interim period are not necessarily indicative of the results for the entire year. The condensed consolidated balance sheet at December 31, 2012 has been derived from the audited consolidated financial statements (and taking into account the corrections and reclassification discussed below) at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. The condensed consolidated financial statements should be read in conjunction with the notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2012. We evaluate subsequent events and the evidence they provide about conditions existing at the date of the balance sheet as well as conditions that arose after the balance sheet date but through the date the financial statements are issued. The effects of conditions that existed at the balance sheet date are recognized in the financial statements. Events and conditions arising after the balance sheet date but before the financial statements are issued are evaluated to determine if disclosure is required to keep the financial statements from being misleading. To the extent such events and conditions exist, disclosures are made regarding the nature of events and the estimated financial effects for those events and conditions. Use of Estimates The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingencies at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting periods. Bio-Rad bases its estimates on historical experience and on various other market-specific and other relevant assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from those estimates. CORRECTION OF IMMATERIAL ERRORS, AND RECLASSIFICATION OF CERTAIN AMOUNTS Inventory Costing During the third quarter of 2013, we identified errors in the consolidated financial statements for the years 2008 through 2012 (and for all interim periods therein) and in the unaudited interim condensed consolidated financial statements for the three month periods ended March 31, 2013 and June 30, 2013, related to the valuation of finished goods inventory in our Life Science segment. We were expensing inventory in amounts greater than actual costs for non-sales transactions, such as expensed inventory used for demonstration purposes and product samples. The effect of correcting these errors in 2008, 2009, 2010, 2011, 2012, and for the three and nine months ended September 30, 2012 consolidated financial statements were increases to net income of $0.6 million, $0.8 million, $0.7 million, $0.8 million, $1.3 million, $0.3 million and $1.0 million, respectively. Research and Development (R&D) Credit During the third quarter of 2013, we revised the classification of certain amounts for all periods presented from “Provision for income taxes” to “Research and development expense” in our Consolidated Statements of Operations to conform to the current year presentation. The amounts reclassified pertain to a refundable French R&D tax credit, which after the reclassification reduces Research and development expense. The effect of the reclassifications from Provision for income taxes to Research and development expense for 2010, 2011, 2012, and for the three and nine months ended September 30, 2012 was $5.8 million, $8.8 million, $4.8 million, $1.2 million and $3.6 million, respectively. Following are the amounts in thousands that should have been reported for the Consolidated Statements of Operations giving effect to the errors and the reclassification described above:
| Three Months Ended |  | Nine Months Ended |  | Year Ended December 31,
| September 30, 2012 |  | September 30, 2012 |  | 2012 | 2011 | 2010
Cost of goods sold | $ | 224,927 |  |  | $ | 654,784 |  |  | $ | 914,077 |  | $ | 894,700 |  | $ | 835,310 |
Selling, general and administrative expense | $ | 160,134 |  |  | $ | 492,913 |  |  | $ | 681,778 |  | $ | 695,984 |  | $ | 634,413 |
Research and development expense | $ | 47,795 |  |  | $ | 150,637 |  |  | $ | 209,204 |  | $ | 177,604 |  | $ | 166,486 |
Provision for income taxes | $ | 12,383 |  |  | $ | 48,375 |  |  | $ | 64,729 |  | $ | 67,034 |  | $ | 39,533 |
Presentation and Disclosure of the Statements of Comprehensive Income During the first quarter of 2013, we identified errors in the Consolidated Statements of Comprehensive Income for 2012, 2011 and 2010, and in the unaudited interim Condensed Consolidated Statements of Comprehensive Income for all three quarters of 2012, which affected two line items within this financial statement. Specifically, we incorrectly calculated the 1) net unrealized holding gains on available-for-sale (AFS) investments, net of tax, and 2) reclassification adjustments for net holding gains/losses on AFS investments included in net income including noncontrolling interests, net of tax. Following are the amounts in thousands that should have been reported for the Consolidated Statements of Comprehensive Income giving effect to the errors described above:
| Three Months Ended |  | Nine Months Ended |  | Year Ended December 31,
| September 30, 2012 |  | September 30, 2012 |  | 2012 | 2011 | 2010
Net unrealized holding gains on AFS investments, net of income tax; understated by $1,438, $9,946, $10,090 and $770 for the three and nine months ended September 30, 2012, and for the years ended 2012 and 2010, respectively, and overstated by $208 for the year ended 2011. | $21,023 |  | $52,219 |  | $65,448 | $12,663 | $15,495
Income taxes on net unrealized holding gains on AFS investments; understated by $836, $5,790, $5,874 and $448 for the three and nine months ended September 30, 2012, and for the years ended 2012 and 2010, respectively, and overstated by $121 for the year ended 2011. | $12,240 |  | $30,405 |  | $38,108 | $7,373 | $9,022
Reclassification adjustments for net holding (gains) losses on AFS investments included in Net income including noncontrolling interests, net of income tax; understated by $1,438, $9,946, $10,090 and $770 for the three and nine months ended September 30, 2012, and for the years ended 2012 and 2010, respectively, and overstated by $208 for the year ended 2011. | $(719) |  | $(4,973) |  | $(5,045) | $104 | $(385)
Income taxes on reclassification adjustments for net holding gains/losses on AFS investments included in Net income including noncontrolling interests; understated by $836, $5,790, $5,874 and $448 for the three and nine months ended September 30, 2012, and for the years ended 2012 and 2010, respectively, and overstated by $121 for the year ended 2011. | $(418) |  | $(2,895) |  | $(2,937) | $61 | $(224)
Management evaluated the materiality of the errors from a qualitative and quantitative perspective. Based on such evaluation, we have concluded that while the accumulation of these errors was significant to the three months ended September 30, 2013, their correction would not be material to any individual prior period, nor did they have an effect on the trend of financial results, taking into account the requirements of the Securities and Exchange Commission (SEC) Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (SAB 108). Accordingly, we will correct these errors prospectively when the 2013 Consolidated Statements of Income and Comprehensive Income are included in future filings. Recent Accounting Standards Updates In February 2013, the Financial Accounting Standards Board (FASB) issued guidance requiring that companies present either in a single note or parenthetically on the face of the financial statements, the effect of significant amounts reclassified from each component of accumulated other comprehensive income based on its source and the income statement line items affected by the reclassification. If a component is not required to be reclassified to net income in its entirety, companies would instead cross reference to the related footnote for additional information. We adopted this guidance as of January 1, 2013 and present it in a single note.

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