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POLARIS INDUSTRIES INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Organization and Significant Accounting Policies
Polaris Industries Inc. (‘‘Polaris’’ or the ‘‘Company’’), a Minnesota corporation, and its subsidiaries are
engaged in the design, engineering, manufacturing and marketing of innovative, high-quality, high-performance
Off-Road Vehicles (ORV), Snowmobiles, Motorcycles and Global Adjacent Markets vehicles. Polaris products,
together with related parts, garments and accessories are sold worldwide through a network of independent
dealers and distributors and its subsidiaries. The primary markets for our products are the United States,
Canada, Western Europe, Australia and Mexico.
Basis of presentation. The accompanying consolidated financial statements include the accounts of Polaris and
its wholly-owned subsidiaries. All inter-company transactions and balances have been eliminated in
consolidation. Income from financial services is reported as a component of operating income to better reflect
income from ongoing operations, of which financial services has a significant impact.
On September 2, 2004, the Company announced its decision to discontinue the manufacture of marine
products effective immediately. Material financial results for the marine products division are reported
separately as discontinued operations for all periods presented.
The Company evaluates consolidation of entities under Accounting Standards Codification (ASC) Topic 810.
This Topic requires management to evaluate whether an entity or interest is a variable interest entity and
whether the company is the primary beneficiary. Polaris used the guidelines to analyze the Company’s
relationships, including its relationship with Polaris Acceptance, and concluded that there were no variable
interest entities requiring consolidation by the Company in 2015, 2014 and 2013.
In January 2015, the Company acquired the electric motorcycle business of Brammo, Inc. In April 2015, the
Company completed the acquisitions of Timbersled Products, Inc. (‘‘Timbersled’’) and HH Investment Limited
(‘‘Hammerhead’’). Timbersled is based in Idaho and is an innovator and market leader in the burgeoning
snow bike industry. Hammerhead is based in Shanghai, China and manufactures gasoline powered go-karts,
light utility vehicles, and electric utility vehicles. Hammerhead markets its products globally under the
Hammerhead Off-Road brand, along with maintaining key private label relationships with other original
equipment manufacturers. At the end of December 2015, the Company completed the acquisition of certain
assets of 509, Inc. (‘‘509’’). 509 is based in Washington and is an aftermarket leader in snowmobile helmets
and goggles. The Company has included the financial results of the acquisitions in its consolidated results of
operations beginning on the respective acquisition dates; however, the acquisitions did not have a material
impact on Polaris’ consolidated financial position or results of operations. Refer to Note 5 for additional
information regarding the acquisitions of Timbersled, Hammerhead and 509.
In April 2014, the Company completed an acquisition of Kolpin Outdoors, Inc. (‘‘Kolpin’’), and in November
2014, completed the acquisition of certain assets of LSI Products Inc. and Armor Holdings, LLC. (‘‘Pro
Armor’’). Kolpin is a leading aftermarket brand delivering purpose-built and universal-fit ORV accessories and
lifestyle products. Pro Armor is an industry-leading brand in performance side-by-side accessories, that
operates under the Pro Armor brand.
Use of estimates. The preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during the reporting period. Ultimate
results could differ from those estimates.
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