Company: NPO
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0001164863-25-000009
Chunk: 122

Company: Enpro Inc.
Filing Date: 2025-02-21
Form: 10-K
Item: Item 1A
Chunk 122
---
 have revised the consolidated statement of cash flows for the year ended December 31, 2022 included in the accompanying consolidated statement of cash flows to properly classify the cash outflow for the purchase of the LeanTeq non-controlling interests as a financing activity. See Note 2, "Acquisitions," for further information with respect to the acquisition of such non-controlling interests.Summary of Significant Accounting PoliciesBusiness Combinations - We utilize the acquisition method of accounting for all business combinations which requires us  to estimate the fair value of assets acquired and liabilities assumed. We may adjust these estimates up to one-year from the date the business was acquired. Valuations of intangible assets acquired in a business combination require judgement and often comprise a significant portion of the total assets acquired. We use the income approach to determine the fair-value of our intangible assets, primarily using the relief-from-royalty or multi-period excess earnings method. Under these valuation approaches, we use assumptions in valuing the assets, including projected revenues and profit margins, royalty rates, obsolescence factors, customer attrition rates, contributory asset charges, tax rates, discount rates and long-term growth rates. Any excess total consideration transferred in a business combination greater than the fair value of identifiable assets acquired net of liabilities assumed is recorded as goodwill. Acquisition-related costs are expensed as incurred. Revenue Recognition – The largest stream of revenue is product revenue for shipments of the various products discussed further in Note 18, "Business Segment Information," along with a smaller amount of revenue from services that typically take place over a short period of time.  We recognize revenue at a point in time following the transfer of control, which typically occurs when a product is shipped or delivered, depending on the terms of the sale agreement, or when services are rendered.  Shipping costs billed to customers are recognized as revenue and expensed in cost of goods sold as a fulfillment cost when 

59

control of the product transfers to the customer.  Payment from customers is typically due within 30 days of the sale for sales in the U.S.  For sales outside of the U.S., payment terms may be longer based upon local business customs, but are typically due no later than 90 days after the sale. Redeemable Non-Controlling Interests – Non-controlling interests in subsidiaries that are redeemable for cash or other assets outside of our control are classified as mezzanine equity, outside of equity and liabilities, at the greater of the carrying value or the redemption value. The increases or decreases in the estimated