Changes in Accounting Policy | Changes in Accounting Policy Except for the changes below, the Company has consistently applied the accounting policies to all periods presented in these condensed consolidated financial statements. The Company adopted ASC 606, "Revenue from Contracts with Customers," effective January 1, 2018. As a result, the Company has changed its accounting policy for revenue recognition as detailed in Note 14. The Company applied ASC 606 using the cumulative effect method by recognizing the cumulative effect of initially applying ASC 606 as an adjustment to the opening balance of equity at January 1, 2018. Therefore, the comparative information has not been adjusted and continues to be reported under ASC 605. The details of the significant changes and quantitative impact of the changes are set out below. December 31, 2017 As Reported Adjustments January 1, 2018 Adjusted Assets Current Assets Trade accounts receivable, net of allowances $ 725,251 $ 3,636 $ 728,887 Other receivables 64,561 41,351 105,912 Inventories: Finished and in process 196,204 (37,447) 158,757 Total Assets $ 4,557,721 $ 7,540 $ 4,565,261 Liabilities and Equity Current Liabilities Accrued expenses and other 283,355 5,215 288,570 999,970 5,215 1,005,185 Deferred Income Taxes 74,073 604 74,677 Sonoco Shareholders’ Equity Retained earnings 2,036,006 1,721 2,037,727 Total Sonoco Shareholders’ Equity 1,707,066 1,721 1,708,787 Total Equity 1,730,060 1,721 1,731,781 Total Liabilities and Equity $ 4,557,721 $ 7,540 $ 4,565,261 The following table summarizes the impact of the adoption of ASC 606 on the Company's Condensed Consolidated Balance Sheet as of September 30, 2018: September 30, 2018 as reported Adjustments Balances without Assets Current Assets Trade accounts receivable, net of allowances $ 775,054 (5,744) $ 769,310 Other receivables 93,470 (44,698) 48,772 Inventories: Finished and in process 157,920 42,051 199,971 Total Assets $ 4,658,634 $ (8,391) $ 4,650,243 Liabilities and Equity Current Liabilities Accrued expenses and other 321,842 (5,998) 315,844 994,384 (5,998) 988,386 Deferred Income Taxes 85,473 (622) 84,851 Sonoco Shareholders' Equity Retained earnings 2,151,658 (1,771) 2,149,887 Total Sonoco Shareholders’ Equity 1,810,821 (1,771) 1,809,050 Total Equity 1,832,930 (1,771) 1,831,159 Total Liabilities and Equity $ 4,658,634 $ (8,391) $ 4,650,243 The following table summarizes the impact of the adoption of ASC 606 on the Company's Condensed Consolidated Statement of Income for the three- and nine-months ending September 30, 2018: Three Months Ended Nine Months Ended September 30, 2018 Adjustments Balances September 30, 2018 Adjustments Balances Net sales $ 1,364,762 $ (648) $ 1,364,114 $ 4,035,322 $ (4,673) $ 4,030,649 Cost of sales 1,105,126 (1,731) 1,103,395 3,248,624 (4,605) 3,244,019 Gross profit 259,636 1,083 260,719 786,698 (68) 786,630 Operating profit 101,573 1,083 102,656 343,533 (68) 343,465 Income before income taxes 87,096 1,083 88,179 300,352 (68) 300,284 Provision for income taxes 18,325 281 18,606 71,974 (18) 71,956 Income before equity in earnings of affiliates 68,771 802 69,573 228,378 (50) 228,328 Net income 72,820 802 73,622 237,390 (50) 237,340 Net income attributable to Sonoco $ 72,415 $ 802 $ 73,217 $ 235,882 $ (50) $ 235,832 The following table summarizes the impact of the adoption of ASC 606 on the Company's Condensed Consolidated Statement of Comprehensive Income for the three- and nine-month periods ending September 30, 2018: Three Months Ended Nine Months Ended September 30, 2018 Adjustments Balances September 30, 2018 Adjustments Balances Net income $ 72,820 $ 802 $ 73,622 $ 237,390 $ (50) $ 237,340 Other comprehensive income/(loss): Foreign currency translation adjustments 1,186 (30) 1,156 (40,418) 13 (40,405) Other comprehensive income 9,806 (30) 9,776 (17,824) 13 (17,811) Comprehensive income 82,626 772 83,398 219,566 (37) 219,529 Comprehensive income attributable to Sonoco $ 82,951 $ 772 $ 83,723 $ 220,465 $ (37) $ 220,428 The following table summarizes the impact of the adoption of ASC 606 on the Company's Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2018: Nine Months Ended September 30, 2018 Adjustments Balances without Cash Flows from Operating Activities: Net income $ 237,390 $ (50) $ 237,340 Trade accounts receivable (58,187) 2,108 (56,079) Inventories (8,938) (4,604) (13,542) Other assets and liabilities 22,365 3,347 25,712 Accrued expenses 35,353 (783) 34,570 Income taxes payable and other income tax items (13,050) (18) (13,068) Net cash provided by operating activities $ 451,516 $ — $ 451,516 |