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EMCOR
Group, Inc., a Delaware corporation, and subsidiaries (“EMCOR”)
is the largest mechanical and electrical construction and facilities
services firm in the United States and Canada and one of the largest
in the United Kingdom. EMCOR specializes in the design, installation,
integration, start-up, operation and maintenance of: (1) distribution
systems for electrical power, including power cables, conduits,
distribution panels, transformers, generators, uninterruptible power
supply systems and related switch gear and controls;
(2) lighting systems, including fixtures and controls; (3) low-voltage
systems, including fire alarm, security and process control systems;
(4) voice and data communications systems, including fiber-optic
and low voltage copper cabling; (5) heating, ventilation, air conditioning,
refrigeration and clean room process ventilation systems; and (6)
plumbing, process and high-purity piping systems. EMCOR provides
mechanical and electrical construction services and facilities services
directly to corporations, municipalities and other governmental
entities, owners/developers, and tenants of buildings. It also provides
these services indirectly by acting as a subcontractor to construction
managers, general
contractors, systems suppliers and other subcontractors. Mechanical
and electrical construction services often fall into one of two
categories: (1) large installation projects with contracts often
in the multi-million dollar range and (2) smaller installation projects
typically involving fit-out renovations and retrofit work. In addition,
EMCOR also provides services needed to support a customer’s facilities
not related to construction projects. These services, frequently
referred to as facilities services, include customer-based operations
and maintenance, mobile maintenance and service, small modification
and retrofit projects, consulting, program development and management
for energy systems, and maintenance of facilities. These services
are provided to a wide range of commercial, industrial, and institutional
buildings including facilities at which EMCOR provided construction
services and at which construction services were provided by others.
Facilities services are frequently bundled to provide integrated
service packages and may include services in addition to EMCOR’s
core mechanical and electrical services.
Principles
of Consolidation The
consolidated
financial
statements
include
the
accounts
of
EMCOR
and
its
majority-owned
subsidiaries.
Significant
intercompany
accounts
and
transactions
have
been
eliminated.
Investments
over
which
EMCOR
exercises
significant
influence,
but
does
not
control
(generally
a
20%
to
50%
ownership
interest),
are
accounted
for
using
the
equity
method
of
accounting.
Principles
of Preparation The
preparation
of
the
consolidated
financial
statements
in
conformity
with
generally
accepted
accounting
principles
requires
EMCOR
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
and
liabilities
at
the
date
of
the
financial
statements
and
the
reported
amounts
of
revenues
and
expenses
during
the
reporting
period.
Actual
results
could
differ
from
those
estimates.
Reclassifications
of prior years’ data have been made in the accompanying consolidated
financial statements where appropriate to conform to the current
presentation.
Revenue
Recognition Revenues
from
long-term
contracts
are
recognized
on
the
percentage-of-completion
method.
Percentage-of-completion
is
measured
principally
by
the
percentage
of
costs
incurred
and
accrued
to
date
for
each
contract
to
the
estimated
total
costs
for
each
contract
at
completion.
Certain
of
EMCOR’s
electrical
contracting
business
units
measure
percentage-of-completion
by
the
percentage
of
labor
costs
incurred
to
date
for
each
contract
to
the
estimated
total
labor
costs
for
such
contract.
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