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Summary of Significant Accounting Policies (Policies) | 3 Months Ended
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Mar. 29, 2014
Accounting Policies [Abstract] |
Basis of Presentation |
A) | Basis of Presentation
The condensed consolidated financial statements have been prepared by The Middleby Corporation (the "company" or “Middleby”), pursuant to the rules and regulations of the Securities and Exchange Commission. The financial statements are unaudited and certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the company believes that the disclosures are adequate to make the information not misleading. These financial statements should be read in conjunction with the financial statements and related notes contained in the company's 2013 Form 10-K. The company’s interim results are not necessarily indicative of future full year results for the fiscal year 2014. In the opinion of management, the financial statements contain all adjustments necessary to present fairly the financial position of the company as of March 29, 2014 and December 28, 2013, and the results of operations for the three months ended March 29, 2014 and March 30, 2013 and cash flows for the three months ended March 29, 2014 and March 30, 2013.
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses. Significant estimates and assumptions are used for, but are not limited to, allowances for doubtful accounts, reserves for excess and obsolete inventories, long lived and intangible assets, warranty reserves, insurance reserves, income tax reserves and post-retirement obligations. Actual results could differ from the company's estimates.
Non-Cash Share-Based Compensation |
B) | Non-Cash Share-Based Compensation
The company estimates the fair value of market-based stock awards and stock options at the time of grant and recognizes compensation cost over the vesting period of the awards and options. Non-cash share-based compensation expense was $1.9 million and $3.0 million for the first quarter periods ended March 29, 2014 and March 30, 2013, respectively.
Income Tax Contingencies |
C) | Income Taxes
As of December 28, 2013, the total amount of liability for unrecognized tax benefits related to federal, state and foreign taxes was approximately $12.7 million (of which $11.1 million would impact the effective tax rate if recognized) plus approximately $2.0 million of accrued interest and $1.8 million of penalties. The company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. As of March 29, 2014, the company recognized a tax expense of $0.7 million for unrecognized tax benefits related to current year tax exposures. It is reasonably possible that the amounts of unrecognized tax benefits associated with state, federal and foreign tax positions may decrease over the next twelve months due to expiration of a statute or completion of an audit. The company believes that it is reasonably possible that approximately $3.4 million of its currently remaining unrecognized tax benefits may be recognized over the next twelve months as a result of lapses of statutes of limitations. A summary of the tax years that remain subject to examination in the company’s major tax jurisdictions are:
United States - federal | 2008 – 2013
United States - states | 2004 – 2013
Australia | 2011 – 2013
Brazil | 2010 – 2013
Canada | 2009 – 2013
China | 2003 – 2013
Czech Republic | 2013
Denmark | 2009 – 2013
France | 2011 – 2013
Germany | 2011 – 2013
India | 2013
Italy | 2009 – 2013
Luxembourg | 2011 – 2013
Mexico | 2007 – 2013
Philippines | 2009 – 2013
South Korea | 2007 – 2011
Spain | 2008 – 2013
Taiwan | 2008 – 2012
United Kingdom | 2009 – 2013
Fair Value Measures |
D) | Fair Value Measures
ASC 820 "Fair Value Measurements and Disclosures" defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into the following levels: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. Level 3 – Unobservable inputs based on our own assumptions. The company’s financial assets and liabilities that are measured at fair value and are categorized using the fair value hierarchy are as follows (in thousands):
| Fair Value Level 1 |  | Fair Value Level 2 |  | Fair Value Level 3 |  | Total
As of March 29, 2014 |  |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |
Pension plans | $ | 27,791 |  |  | $ | 752 |  |  | $ | — |  |  | $ | 28,543 |
Financial Liabilities: |  |  |  |  |  |  |
Interest rate swaps | $ | — |  |  | $ | 1,000 |  |  | $ | — |  |  | $ | 1,000 |
Contingent consideration | $ | — |  |  | $ | — |  |  | $ | 10,711 |  |  | $ | 10,711 |
As of December 28, 2013 |  |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |
Pension plans | $ | 27,875 |  |  | $ | 621 |  |  | $ | — |  |  | $ | 28,496 |
Financial Liabilities: |  |  |  |  |  |  |
Interest rate swaps | $ | — |  |  | $ | 1,471 |  |  | $ | — |  |  | $ | 1,471 |
Contingent consideration | $ | — |  |  | $ | — |  |  | $ | 10,063 |  |  | $ | 10,063 |

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