XML 18 R8.htm IDEA: XBRL DOCUMENT
v3.20.2

BASIS OF PRESENTATION, RECENT ACCOUNTING PRONOUNCEMENTS AND OTHER | 6 Months Ended
--- | ---
Nov. 30, 2020
Organization Consolidation And Presentation Of Financial Statements [Abstract] |
BASIS OF PRESENTATION, RECENT ACCOUNTING PRONOUNCEMENTS AND OTHER |
1. | BASIS OF PRESENTATION, RECENT ACCOUNTING PRONOUNCEMENTS AND OTHER
Basis of Presentation We have prepared the condensed consolidated financial statements included herein pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures herein are adequate to ensure the information presented is not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended May 31, 2020. We believe that all necessary adjustments, which consisted only of normal recurring items, have been included in the accompanying financial statements to present fairly the results of the interim periods. The results of operations for the interim periods presented are not necessarily indicative of the operating results to be expected for any subsequent interim period or for our fiscal year ending May 31, 2021. During the first half of fiscal 2021, we adopted Accounting Standards Update (ASU) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and subsequent amendments to the initial guidance; and ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815), neither of which had a material impact to our current or historical condensed consolidated financial statements. There have been no changes to our significant accounting policies as disclosed in our Annual Report on Form 10-K for the fiscal year ended May 31, 2020 that had a significant impact on our condensed consolidated financial statements or notes thereto as of and for the six months ended November 30, 2020. Remaining Performance Obligations from Contracts with Customers Trade receivables, net of allowance for doubtful accounts, and deferred revenues are reported net of related uncollected deferred revenues in our condensed consolidated balance sheets as of November 30, 2020 and May 31, 2020. The revenues recognized during the six months ended November 30, 2020 and 2019, respectively, that were included in the opening deferred revenues balances as of May 31, 2020 and 2019, respectively, were approximately $5.9 billion and $6.2 billion, respectively. Revenues recognized from performance obligations satisfied in prior periods and impairment losses recognized on our receivables were immaterial in each of the three and six months ended November 30, 2020 and 2019, respectively. Remaining performance obligations, as defined in Note 1 of Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended May 31, 2020, were $34.4 billion as of November 30, 2020, approximately 60% of which we expect to recognize as revenues over the next twelve months and the remainder thereafter. Sales of Financing Receivables We offer certain of our customers the option to acquire certain of our cloud and license, hardware and services offerings through separate long-term payment contracts. We generally sell these contracts that we have financed for our customers on a non-recourse basis to financial institutions within 90 days of the contracts’ dates of execution. We record the transfers of amounts due from customers to financial institutions as sales of financing receivables because we are considered to have surrendered control of these financing receivables. Financing receivables sold to financial institutions were $300 million and $977 million for the three and six months ended November 30, 2020, respectively, and $196 million and $876 million for the three and six months ended November 30, 2019, respectively. Cash, Cash Equivalents and Restricted Cash Restricted cash that was included within cash and cash equivalents as presented within our condensed consolidated balance sheets as of November 30, 2020 and May 31, 2020 and our condensed consolidated statements of cash flows for the six months ended November 30, 2020 and 2019 was nominal. Acquisition Related and Other Expenses Acquisition related and other expenses primarily consist of personnel related costs for transitional and certain other employees, certain business combination adjustments including adjustments after the measurement period has ended, and certain other operating items, net.
|  | Three Months Ended November 30, |  |  | Six Months Ended November 30, |
(in millions) |  | 2020 |  |  | 2019 |  |  | 2020 |  |  | 2019 |
Transitional and other employee related costs |  | $ | 1 |  |  | $ | 3 |  |  | $ | 3 |  |  | $ | 7 |
Business combination adjustments, net |  |  | — |  |  |  | (4 | ) |  |  | 1 |  |  |  | 2 |
Other, net |  |  | 75 |  |  |  | 13 |  |  |  | 91 |  |  |  | 28 |
Total acquisition related and other expenses |  | $ | 76 |  |  | $ | 12 |  |  | $ | 95 |  |  | $ | 37 |
Non-Operating (Expenses) Income, net Non-operating (expenses) income, net consists primarily of interest income, net foreign currency exchange losses, the noncontrolling interests in the net profits of our majority-owned subsidiaries (primarily Oracle Financial Services Software Limited and Oracle Corporation Japan) and net other income and expenses, including net realized gains and losses related to all of our investments, net unrealized gains and losses related to the small portion of our investment portfolio related to our deferred compensation plan, net unrealized gains and losses related to equity securities and non-service net periodic pension income and losses.
|  | Three Months Ended November 30, |  |  | Six Months Ended November 30, |
(in millions) |  | 2020 |  |  | 2019 |  |  | 2020 |  |  | 2019 |
Interest income |  | $ | 27 |  |  | $ | 145 |  |  | $ | 58 |  |  | $ | 335 |
Foreign currency losses, net |  |  | (16 | ) |  |  | (26 | ) |  |  | (66 | ) |  |  | (80 | )
Noncontrolling interests in income |  |  | (43 | ) |  |  | (46 | ) |  |  | (81 | ) |  |  | (87 | )
Other, net |  |  | 21 |  |  |  | 19 |  |  |  | 76 |  |  |  | 23 |
Total non-operating (expenses) income, net |  | $ | (11 | ) |  | $ | 92 |  |  | $ | (13 | ) |  | $ | 191 |
Recent Accounting Pronouncements Financial Instruments: In March 2020, the Financial Accounting Standards Board (FASB) issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASU 2020-04). ASU 2020-04 provides optional guidance for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. We will adopt ASU 2020-04 when our relevant contracts are modified upon transition to alternative reference rates. We do not expect our adoption of ASU 2020-04 to have a material impact on our consolidated financial statements. Income Taxes: In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which is intended to simplify various areas related to the accounting for income taxes and improve consistent application of Topic 740. ASU 2019-12 is effective for us beginning in fiscal 2022, and earlier adoption is permitted. We are currently evaluating the impact of our pending adoption of ASU 2019-12 on our consolidated financial statements.

X
- References No definition available. + Details
Name: | us-gaap_OrganizationConsolidationAndPresentationOfFinancialStatementsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the organization, consolidation and basis of presentation of financial statements disclosure, and significant accounting policies of the reporting entity. May be provided in more than one note to the financial statements, as long as users are provided with an understanding of (1) the significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement with a VIE, (2) the nature of restrictions on a consolidated VIE's assets reported by an enterprise in its statement of financial position, including the carrying amounts of such assets, (3) the nature of, and changes in, the risks associated with an enterprise's involvement with the VIE, and (4) how an enterprise's involvement with the VIE affects the enterprise's financial position, financial performance, and cash flows. Describes procedure if disclosures are provided in more than one note to the financial statements. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -URI http://asc.fasb.org/topic&trid=2122149 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -URI http://asc.fasb.org/topic&trid=2197479 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 275 -URI http://asc.fasb.org/topic&trid=2134479 + Details
Name: | us-gaap_OrganizationConsolidationAndPresentationOfFinancialStatementsDisclosureAndSignificantAccountingPoliciesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration