Sunbeam 2004 Annual Report Download - page 47

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Jarden Corporation
Notes to Consolidated Financial Statements
December 31, 2004
1. Significant Accounting Policies
Basis of Presentation
The Company is a leading provider of market-leading branded consumer products used in and
around the home marketed under well-known brand names including Ball®, Bee®, Bicycle®, Crawford®,
Diamond®, FoodSaver®, Forster®, Hoyle®, Kerr®, Lehigh®, Leslie-Locke®, Loew-Cornell®and VillaWare.
As a result of the acquisition of American Household, Inc. (“AHI”) on January 24, 2005 (“AHI
Acquisition”) (see Note 19) the Company also sells global consumer products through such brands as
Campingaz®, Coleman®, First Alert®, Health o meter®, Mr. Coffee®, Oster®and Sunbeam®brands. See
Business Segment Information (Note 5) for a discussion of the Company’s products.
These consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the United States. The consolidated financial statements include the
accounts of Jarden Corporation and its subsidiaries (“Company”). All significant intercompany
transactions and balances have been eliminated upon consolidation.
On a stand-alone basis, without the consolidation of its subsidiaries, the Company has no
independent assets or operations. The guarantees by its subsidiaries of the 9
3
⁄
4
% senior subordinated
notes (“Notes”), which are discussed in Note 8, are full and unconditional and joint and several. The
subsidiaries that are not guarantors of the Notes are minor. There are no significant restrictions on the
Company’s or the guarantors’ ability to obtain funds from their respective subsidiaries by dividend or
loan.
Certain reclassifications have been made in the Company’s financial statements of prior years to
conform to the current year presentation. These reclassifications have no impact on previously reported
net income.
Use of Estimates
The preparation of the consolidated financial statements in accordance with generally accepted
principles in the United States requires estimates and assumptions that affect amounts reported and
disclosed in the financial statements and accompanying notes. Actual results could differ materially from
those estimates.
Revenue Recognition
The Company recognizes revenue when title transfers. In most cases, title transfers at the time
product is shipped to customers. The Company allows customers to return defective or damaged
products as well as certain other products for credit, replacement, or exchange. Revenue is recognized
as the net amount to be received after deducting estimated amounts for product returns, discounts, and
allowances. The Company estimates future product returns based upon historical return rates and its
judgment.
Distribution Costs
Distribution costs, including the costs of shipping and handling, are included in Cost of Sales in the
Consolidated Statements of Income.
45