notes to consolidated financial statements

Effective January 1, 2002, the company adopted the provisions of SFAS No. 142, Goodwill and Other Intangible Assets. This statement discontinued the amortization of goodwill, subject to periodic impairment testing. The adjusted amounts shown below reflect the effect of retroactive application of the discontinuance of the amortization of goodwill as if the new method of accounting had been in effect during 2001. The adjusted information for 2001 presents the historical information prior to the acquisition of the former European joint venture.

	As Reported		Adjusted
(thousands, except per share)	2003	2002	2001
Reported net income	$277,348	$209,770	$188,170
Goodwill amortization (net of tax)			18,471
Adjusted net income	$277,348	$209,770	$206,641
Basic earnings per share
Net income, as reported	$       1.07	$       0.81	$       0.74
Goodwill amortization (net of tax)	---	---	0.07
Adjusted basic earnings per share	$       1.07	$       0.81	$       0.81
Diluted earnings per share
Net income, as reported	$       1.06	$       0.80	$       0.72
Goodwill amortization (net of tax)	---	---	0.07
Adjusted diluted earnings per share	$       1.06	$       0.80	$       0.80

Per share amounts do not necessarily sum due to rounding.

The company was required to test all existing goodwill for impairment as of January 1, 2002 on a reporting unit basis. Generally, the company's reporting units are its operating segments. Under SFAS No. 142, the fair value approach is used to test goodwill for impairment. This method differed from the company's prior policy of using an undiscounted cash flows method for testing goodwill impairment. An impairment charge is recognized for the amount, if any, by which the carrying amount of goodwill exceeds its implied fair value. Fair values of reporting units were established using a discounted cash flow method. Where available and as appropriate, comparative market multiples were used to corroborate the results of the discounted cash flow method.

The result of testing goodwill for impairment in accordance with the adoption of SFAS No. 142, was a non-cash charge of $4.0 million after tax, or $0.02 per share, which is reported on the accompanying consolidated statement of income as a cumulative effect of a change in accounting in 2002. The impairment charge relates to the Africa/Export operations, which is part of the International Cleaning & Sanitizing reportable segment. The primary factor resulting in the impairment charge was the difficult economic environment in the region.

Under SFAS No. 142, goodwill must be tested annually for impairment. Based on the company's testing in 2003 and 2002, there has been no additional impairment of goodwill. The company performs its annual goodwill impairment test during the second quarter. If circumstances change significantly within a reporting unit, the company would test it for impairment prior to the annual test for impairment.