Company: SSUP
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0000950170-25-034599
Chunk: 83

Company: SUPERIOR INDUSTRIES INTERNATIONAL INC
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1B
Chunk 83
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 are adjusted as variations arise. In North America, OEM price adjustments due to manufacturing efficiencies are generally recognized as and when negotiated with customers. Contracts with European OEMs generally include annual price reductions based on expected manufacturing efficiencies over the life of the vehicle wheel program which are accrued as revenue is recognized. Customer contract prices are generally adjusted quarterly to incorporate price adjustments.  The Company collects and remits taxes assessed by various governmental authorities that are both imposed on and concurrent with revenue-producing transactions with its customers. These taxes may include, but are not limited to, sales, use, and value-added taxes. The collection and remittance of these taxes is reported on a net basis. Shipping costs are treated as a cost of fulfillment.  The Company’s warranties are limited to product specifications and the Company does not accept product returns unless the item is defective as manufactured. Accordingly, warranty costs are treated as a cost of fulfillment subject to accrual, rather than a performance obligation. The Company establishes provisions for both estimated returns and warranty when revenue is recognized for aftermarket sales. The Company establishes provisions for estimated returns and warranties for OEM sales when specific defective product or warranty issues are identified on the OEM products. In addition, the Company does not typically provide customers with the right to a refund but provides for product replacement.  Refer to Note 2, “Revenue” for further discussion on the Company’s revenue recognition.  Pre-Production CostsThe Company develops tooling necessary to produce wheels for its customers. Customer tooling reimbursement is generally based on quoted prices or cost not to exceed quoted prices. Tooling costs, which are explicitly recoverable from customers, are capitalized as preproduction costs and amortized to cost of sales over the average life of the vehicle wheel program. Similarly, customer reimbursements for tooling costs are deferred and amortized to net sales over the average life of the vehicle wheel program. Income Taxes Deferred tax assets and liabilities are recognized on the basis of future tax consequences attributable to temporary differences that exist between the financial reporting carrying value of assets and liabilities and their tax reporting values. Deferred tax assets and liabilities are measured using enacted tax rates that will apply in the years the temporary differences are expected to be recovered or paid. Adjustments based on filed returns are recorded when identified in the subsequent years. Changes in tax laws or accounting standards and methods may affect recorded deferred taxes in future periods.  Valuation allowances are recorded to reduce deferred tax assets to an amount that is more likely than not to be realized. Deferred tax assets are assessed quarterly to determine if a valuation allowance is required