GPCGenuine Parts Company

Please remove the total segment profit and total segment profit margin non-GAAP measures from your filings or remove the corporate expense adjustment, since this adjustment appears to result in the exclusion of normal, recurring, cash operating expenses from these non-GAAP measures. Refer to Questions 100.01 and 104.04 of the Non-GAAP Financial Measures Compliance and Disclosure Interpretations.

In future filings, we will no longer present total segment profit or total segment profit margin. Read in the reply ↗

Please revise the other assets and liabilities line item to present changes in other assets separately from other liabilities and further breakout any material components. Also, present acquisitions separately from other investing activities and further breakout any material components. Refer to ASC 230-10-45-7 and 45-29.

In future filings, we will present changes in other assets separately from changes in other liabilities and further breakout any material components. We will also present acquisitions of businesses separately from other investing activities and further breakout any material components. We will include this disclosure in our upcoming year end Form 10-K. Read in the reply ↗

Please disclose in greater detail the types of amounts included in the corporate expense line item of your segment reconciliation. Refer to ASC 280-10-50-31. Also, revise your management's discussion and analysis section to discuss with quantification the business reasons for material changes between periods in (a) each segment's profit and (b) any material reconciling items of the segment reconciliation in Note 2,

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such as corporate expense. In circumstances where there are more than one business reason for the change, such as in your Industrial segment discussion on page 24, please quantify the incremental impact of each individual business reason discussed on the overall change in the line item. Refer to Item 303 of Regulation S-K and SEC Release No. 33-8350.

In future filings, we will enhance our disclosure to provide further description of the nature of the corporate expense line item within our segment reconciliation in accordance with ASC 280-10-50-31.

An example of the disclosure we will include in future filings is provided as follows:

Corporate expense includes the costs of our corporate headquarters functions and certain other activities that provide broad-based support to our business units.

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These costs primarily consist of salaries and benefits associated with executive leadership, human resources, technology, cybersecurity, legal, corporate finance, and internal audit personnel. Corporate expense also includes costs and fees arising from product liability claims, cash management activities and certain other programs that are managed centrally.

In addition, in future filings, our Management's Discussion and Analysis (MD&A) section will include a quantitative discussion of the business reasons for material changes between periods in each segment’s profit, along with any significant reconciling items, including corporate expense. When multiple business reasons contribute to a material change, we will quantify the incremental impact of the individual factors on the overall change in the line item, in accordance with Item 303 of Regulation S-K and SEC Release No. 33-8350.

We will include these additional disclosures in our upcoming year end Form 10-K.

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You present total segment profit and total segment margin that appear to be non-GAAP financial measures in MD&A. Please remove these non-GAAP measures or provide the disclosures required by Item 10(e) of Regulation S-K. Refer to Question 104.04 of the Non-GAAP Financial Measures Compliance and Disclosure Interpretations. This comment also applies to your Forms 10-Q filed in fiscal year 2023.

We respectfully acknowledge the Staff’s comments. As part of our ongoing effort to increase our transparency with investors about the financial measures we believe are important for evaluating our business performance, we added total segment profit and total segment margin to MD&A in the Form 10-K for the year ended December 31, 2022 and to subsequent Forms 10-Q filed in fiscal year 2023.

In response to the Staff’s comment, we further reviewed the guidance in Question 104.04 of the Non-GAAP Financial Measures Compliance and Disclosure Interpretations and in future filings, we will provide

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the disclosures required by Item 10(e) of Regulation S-K within MD&A, including a reconciliation of total segment profit and total segment margin to their nearest GAAP measures. We will provide the disclosures required, including this reconciliation, beginning with our upcoming third quarter Form 10-Q.

An example of the reconciliation we will include in future filings is provided below.

Year Ended December 31,

(in thousands)

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You record a tax impact of adjustments representing 2.7% of the total adjustments made in determining adjusted net income as compared to the GAAP effective tax rate of 24.8% in fiscal year 2022. Please expand your disclosure to clarify how you determined the tax effect of non-GAAP adjustments in calculating the adjusted net income and adjusted diluted EPS in each reporting period presented.

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Refer to Question 102.11 of the Non- GAAP Financial Measures Compliance and Disclosure Interpretations.

As background, we respectfully advise the Staff that the approach we use to determine the tax effect of non-GAAP adjustments considers the tax laws and statutory income tax rates applicable in the tax jurisdictions of the underlying non-GAAP adjustments, including any related valuation allowances.

In future filings, we will expand our disclosures to provide additional details about how the income tax impacts of the adjustments are calculated, consistent with the guidance at Question 102.11 of the Non-GAAP Financial Measures Compliance and Disclosure Interpretation.

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We will include these additional disclosures in our upcoming third quarter Form 10-Q.

An example of our enhanced disclosure that we will include in future filings within our Non-GAAP Financial Measures section of MD&A is provided below.

We determine the tax effect of non-GAAP adjustments by considering the tax laws and statutory income tax rates applicable in the tax jurisdictions of the underlying non-GAAP adjustments, including any related valuation allowances. For the year ended December 31, 2022, we applied the statutory income tax rates to the taxable portion of all of our adjustments, which resulted in a tax impact of $137,000. A portion of our transaction costs included in our non-GAAP adjustments for the year ended December 31, 2022 were not deductible for income tax purposes; therefore, no statutory income tax rate was applied to such costs.

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Please state separately, in your balance sheet or in a note thereto, any elements of prepaid expenses and other current assets in excess of five percent of your total current assets. Refer to Rule 5-02(8) of Regulation S-X. In addition, please separately state any elements of other current liabilities in excess of five percent of your total current liabilities. Refer to Rule 5-02(20) of Regulation S-X.

We respectfully acknowledge the Staff’s comments. Our balance sheet line item for prepaid expenses and other current assets consists primarily of amounts due from vendors, prepaid expenses, income taxes and other miscellaneous receivables. Our balance sheet line item other current liabilities consists primarily of current lease obligations, allowances for sales returns expected within the next year, accrued compensation, accrued income and other taxes, and other accruals for expenses incurred.

Each reporting period, we evaluate the presentation requirements for these line items and consider

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any components that exceed the threshold set forth in Rule 5-02(8) and Rule 5-02(20) of Regulation S-X. With respect to the amounts due from vendors, which is included in the line item prepaid expenses and other current assets, these balances totaled $585 million and $529 million as of December 31, 2022 and 2021, respectively. Amounts due to us from vendors primarily relate to consideration under various volume rebate and cost reimbursement programs and do not specifically relate to a single vendor or a single vendor consideration program. These amounts fluctuate from period to period based on our purchases of inventory from our vendors, which is tied to our sales to our customers, and has been below the five percent threshold in certain recent quarterly reporting periods. We perform a qualitative and quantitative analysis on these balances each reporting period, including consideration of key trends and users of the financial statements, and while these balances exceeded the five percent threshold as of December 31, 2022 and 2021, we concluded the disclosure of amounts due from vendors was not material for the periods presented.

There were no other elements of either prepaid expenses and other current assets or other current liabilities that exceed the five percent threshold in any of the balance sheet periods presented.

In response to the Staff’s comment, we further reviewed the guidance and in future filings, we will disclose amounts due from vendors and any other components that exceed the threshold set forth in Rule 5-02(8) and Rule 5-02(20) of Regulation S-X on the face of the balance sheets or related notes to the financial statements, beginning with our third quarter Form 10-Q.

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We note that your current disclosure about the usefulness of your non-GAAP measures indicates that you believe that the presentation of adjusted net income and adjusted net income per common share is indicative of the company's core operations. Please revise to provide a more substantive discussion of how your non-GAAP measures are useful to investors. Refer to Item 10(e)(1)(i)(C) of Regulation S-K.

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Earnings releases on Forms 8- K should be similarly revised. Item 9A. Controls and Procedures Management’s conclusion regarding the effectiveness of disclosure controls and procedures,

The Company respectfully advises the Staff that it will revise its non-GAAP measures in future filings with the Commission, including future earnings releases furnished on Form 8-K. The Company's intended disclosure is set forth below, with the new disclosure underlined for ease of the Staff’s review.

Non-GAAP Measures

The following table sets forth a reconciliation of net income and diluted net income per common share to adjusted net income and adjusted diluted net income per common share to account for the impact of these adjustments.

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The Company believes that the presentation of adjusted net income and adjusted net income per common share, which are not calculated in accordance with generally accepted accounting principles in the U.S. (“GAAP”), when considered together with the corresponding GAAP financial measures and the reconciliations to those measures, provide meaningful supplemental information to both management and investors that is indicative of the Company's core operations. The Company considers these metrics useful to investors because they provide greater transparency into management’s view and assessment of the Company’s ongoing operating performance by removing items management believes are not representative of our continuing operations and may distort our longer-term operating trends. We believe these measures to be useful to enhance the comparability of our results from period to period and with our competitors, as well as to show ongoing results from operations distinct from items that are infrequent or not associated with the Company’s core operations. The Company does not, nor does it suggest investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, GAAP financial information.

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We note in the first paragraph of this section that you discuss management's evaluation of the the effectiveness of disclosure controls and procedures, however, the conclusion references your internal control over financial reporting instead of disclosing the conclusion of the effectiveness of your disclosure controls and procedures.

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Please amend the filing to disclose the conclusion of your principal executive and principal financial officers regarding the effectiveness of the company's disclosure controls and procedures as of the end of the period covered by the report. In doing so, please ensure that your certifications reference the Form 10-K/A. and are currently dated. Refer to Item 307 of Regulation S-K. Your Form 10-Qs for the quarters ended March 31, 2019 and June 30, 2019 should be similarly amended. Financial Statements Notes to Consolidated Financial Statements 2. Revenue Recognition, page F-13

The Company respectfully advises the Staff that it will amend its Form 10-K for the year ended December 31, 2018 and Form 10-Qs for the quarters ended March 31, 2019 and June 30, 2019 promptly following resolution of the Staff’s comments in the Comment Letter. The Company notes the Staff’s comment and will provide an explanatory note at the beginning of the Form 10-K/A and 10-Q/As and include all updated certifications that will be currently dated and refer to the amended filings.

The Company's intended 10-K/A disclosure is set forth below, with the revised disclosure underlined for ease of

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the Staff’s review. This revision is a subsection of Item 9A and the remaining part of Item 9A is unchanged. The Company will amend the Form 10-Qs for the quarters ended March 31, 2019 and June 30, 2019 similarly to the language revised in the 10-K/A.

ITEM 9A. CONTROLS AND PROCEDURES.

Management’s conclusion regarding the effectiveness of disclosure controls and procedures

As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of the Company’s disclosure controls and procedures, as such term is defined in SEC Rule 13a-15(e). Based on that evaluation, the Company’s management, including the CEO and CFO, concluded that due to a material weakness in internal control over financial reporting, the Company’s internal control over financial reporting was disclosure controls and procedures were not effective as of December 31, 2018. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

There were no material errors in the financial results or balances identified as a result of the control deficiencies, and there were no restatements of prior period financial statements and no change in previously released financial results were required as the result of these control deficiencies.

Notwithstanding the identified material weakness, management, including our CEO (principal executive officer) and CFO (principal financial officer), believes the consolidated financial statements included in this Annual Report on Form 10-K fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with the United States Generally Accepted Accounting Principles ("U.S. GAAP").

Financial Statements

Notes to Consolidated Financial Statements

2. Revenue Recognition, page F-13

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Please disclose the nature and amount of any contract assets and contract liabilities along with the applicable disclosure requirements in ASC 606-10-50-8 through 10. We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff.

The Company’s understanding is that ASC 606 defines a contract asset as an entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer when that right is conditioned on something other than the passage of time (for example, the entity’s future performance).

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Further, ASC 606 defines a contract liability as an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer.

The Company respectfully advises the Staff that in substantially all of its customer contracts, the Company bills its customers and recognizes revenue for goods and services when control over those goods and services transfers to its customers. Additionally, only very rarely does the Company receive advance payments from its customers (payment before goods are delivered or services are performed.) Any amount of contract assets and liabilities of the Company are de minimis. Because those amounts are de minimis, we do not provide the disclosures required by ASC 606-10-50-8 through 10.

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