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Note 1 - Description of Business and Basis of Presentation (Restated) | 9 Months Ended
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Sep. 30, 2021
Notes to Financial Statements |
Significant Accounting Policies [Text Block] | Throughout these notes to the restated condensed consolidated financial statements, all referenced amounts for the quarterly period ended September 30, 2021 reflect the balances and amounts on a restated basis. NOTE 1 – Description of Business and Basis of Presentation (Restated): Description of business Superior Group of Companies, Inc. (together with its subsidiaries, “the Company,” “Superior,” “we,” “our,” or “us”) was organized in 1920 and was incorporated in 1922 as a New York company under the name Superior Surgical Mfg. Co., Inc. In 1998, the Company changed its name to Superior Uniform Group, Inc. and its state of incorporation to Florida. Effective on May 3, 2018, Superior Uniform Group, Inc. changed its name to Superior Group of Companies, Inc. Superior’s Uniforms and Related Products segment, through its primary signature marketing brands Fashion Seal Healthcare®, HPI®, and WonderWink®, manufactures (through third parties or its own facilities) and sells a wide range of uniforms, corporate identity apparel, career apparel and accessories that are worn by employees in the hospital and healthcare fields; hotels; fast food and other restaurants; transportation; and the private security, industrial and commercial markets. Superior services its Remote Staffing Solutions segment through multiple The Office Gurus® entities, including its subsidiaries in El Salvador, Belize, Jamaica, and the United States (collectively, “TOG”). TOG is primarily a near-shore premium provider of cost effective multilingual telemarketing and business process outsourced solutions. The Promotional Products segment, through the BAMKO®, Public Identity®, Tangerine® and Gifts by Design brands, services customers that purchase primarily promotional and related products. The segment currently has sales offices in the United States, Brazil and Canada with support services in China, Hong Kong and India. Basis of presentation The accompanying unaudited financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. 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. Intercompany items have been eliminated in consolidation. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, and filed with the Securities and Exchange Commission. Management believes that the information furnished includes all adjustments of a normal recurring nature that are necessary to fairly present our consolidated financial position, results of operations and cash flows for the periods indicated. The results of operations for any interim period are not necessarily indicative of results to be expected for the full year. We refer to the condensed consolidated financial statements collectively as “financial statements,” and individually as “statements of comprehensive income,” “balance sheets,” “statements of shareholders’ equity,” and “statements of cash flows” herein. Restatement of Previously Issued Financial Statements Subsequent to the filing of its Form 10-Q, the Company identified an error in its accounting for income taxes associated with the termination of the Company’s two qualified defined benefit pension plans in the second quarter 2021. Specifically, management and the Audit Committee concluded that deferred tax liabilities on the Company’s balance sheet related to previous contributions to the pension plans in excess of book expense recognized should have been reversed when the Company recognized the $6.9 million pension termination charge in the second quarter 2021. The impact of this reversal on the Company’s: • statement of comprehensive income for the nine months ended September 30, 2021 is an additional tax benefit of approximately $1.8 million, and • balance sheet as of September 30, 2021 is an increase in deferred tax assets of approximately $0.4 million and a decrease in deferred tax liabilities of approximately $1.4 million. With corresponding impacts on the statement of cash flows and statements of shareholders’ equity. Each of these adjustments is a non-cash item. The following tables summarize the effects of the restatement on the statement of comprehensive income for the nine months ended September 30, 2021, balance sheet as of September 30, 2021, statement of cash flows for the nine months ended September 30, 2021 and statements of shareholders’ equity for the three and nine months ended September 30, 2021 (in thousands, except per share data):
|  | Nine Months Ended September 30, 2021 |
|  | As Previously Reported |  |  | Restated Adjustment |  |  | As Restated |
Income tax expense |  | $ | 5,490 |  |  | $ | (1,800 | ) |  | $ | 3,690 |
Net income |  |  | 23,251 |  |  |  | 1,800 |  |  |  | 25,051 |
Comprehensive income |  |  | 29,664 |  |  |  | 1,800 |  |  |  | 31,464 |
Net income per basic share |  |  | 1.51 |  |  |  | 0.12 |  |  |  | 1.63 |
Net income per diluted share |  |  | 1.45 |  |  |  | 0.11 |  |  |  | 1.56 |
|  | As of September 30, 2021 |
|  | As Previously Reported |  |  | Restated Adjustment |  |  | As Restated |
Deferred tax asset |  | $ | - |  |  | $ | 352 |  |  | $ | 352 |
Total assets |  |  | 422,177 |  |  |  | 352 |  |  |  | 422,529 |
Deferred tax liability |  |  | 1,448 |  |  |  | (1,448 | ) |  |  | - |
Retained earnings |  |  | 159,711 |  |  |  | 1,800 |  |  |  | 161,511 |
Total shareholders’ equity |  |  | 220,935 |  |  |  | 1,800 |  |  |  | 222,735 |
Total liabilities and shareholders’ equity |  |  | 422,177 |  |  |  | 352 |  |  |  | 422,529 |
|  | Nine Months Ended September 30, 2021 |
|  | As Previously Reported |  |  | Restated Adjustment |  |  | As Restated |
CASH FLOWS FROM OPERATING ACTIVITIES |  |  |  |  |  |  |  |  |  |  |  |
Net income |  | $ | 23,251 |  |  | $ | 1,800 |  |  | $ | 25,051 |
Deferred income tax benefit |  |  | (1,127 | ) |  |  | (1,800 | ) |  |  | (2,927 | )
|  | Three Months Ended September 30, 2021 |
|  | As Previously Reported |  |  | Restated Adjustment |  |  | As Restated |
Balance, July 1, 2021: |  |  |  |  |  |  |  |  |  |  |  |
Retained earnings |  | $ | 153,412 |  |  | $ | 1,800 |  |  | $ | 155,212 |
Total shareholders’ equity |  |  | 213,515 |  |  |  | 1,800 |  |  |  | 215,315 |
Balance, September 30, 2021: |  |  |  |  |  |  |  |  |  |  |  |
Retained earnings |  |  | 159,711 |  |  |  | 1,800 |  |  |  | 161,511 |
Total shareholders’ equity |  |  | 220,935 |  |  |  | 1,800 |  |  |  | 222,735 |
|  | Nine Months Ended September 30, 2021 |
|  | As Previously Reported |  |  | Restated Adjustment |  |  | As Restated |
Net earnings: |  |  |  |  |  |  |  |  |  |  |  |
Retained earnings |  | $ | 23,251 |  |  | $ | 1,800 |  |  | $ | 25,051 |
Total shareholders’ equity |  |  | 23,251 |  |  |  | 1,800 |  |  |  | 25,051 |
Balance, September 30, 2021: |  |  |  |  |  |  |  |  |  |  |  |
Retained earnings |  |  | 159,711 |  |  |  | 1,800 |  |  |  | 161,511 |
Total shareholders’ equity |  |  | 220,935 |  |  |  | 1,800 |  |  |  | 222,735 |
Recent Accounting Pronouncements We consider the applicability and impact of all Accounting Standard Updates (“ASUs”). ASUs not listed below were assessed and determined to be not applicable. Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting of Income Taxes”, which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. On January 1, 2021, the Company adopted this standard on a prospective basis. The Company’s adoption of this standard did not have a material impact on its financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326).” The update changes the impairment model for most financial assets and certain other instruments, including trade and other receivables, held-to-maturity debt securities and loans, and requires entities to use a new forward-looking expected loss model that will result in the earlier recognition of allowance for losses. In February 2020, the FASB issued ASU 2020-2, “Financial Instruments – Credit Losses (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842).” The update delayed the effective date of ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326)” for Smaller Reporting Companies until fiscal years beginning after December 15, 2022. Adoption will require a modified retrospective approach beginning with the earliest period presented. The Company is currently evaluating the potential impact this standard will have on its financial statements. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This update provides optional guidance for a limited period of time to ease potential accounting impacts associated with transitioning away from reference rates that are expected to be discontinued, such as interbank offered rates and LIBOR. This guidance includes practical expedients for contract modifications due to reference rate reform. Generally, contract modifications related to reference rate reform may be considered an event that does not require remeasurement or reassessment of a previous accounting determination at the modification date. This guidance may be applied through December 31, 2022. The Company will apply this guidance to transactions and modifications to contracts and hedging relationships that reference LIBOR.

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