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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2020

Summary of Significant Accounting Policies

This Note 2 to Notes to Condensed Consolidated Financial Statements provides information and disclosure regarding certain of our significant accounting policies and should be read in conjunction with Note 2 to Notes to Consolidated Financial Statements included in our Annual Report, which may provide additional information with regard to the accounting policies set forth herein and other of our significant accounting policies.

a. Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents include cash on hand and cash invested in highly liquid short-term securities, which have remaining maturities at the date of purchase of less than 90 days. Cash and cash equivalents are carried at cost, which approximates fair value. At March 31, 2020 and December 31, 2019, we had $6,679 and $4,865, respectively, of restricted cash held by certain financial institutions related to bank guarantees and required cash collateral.

b. Goodwill and Other Intangible Assets and Liabilities

Goodwill

Our reporting units as of December 31, 2019 are described in detail in Note 2.h. to Notes to Consolidated Financial Statements included in our Annual Report. The goodwill associated with acquisitions completed during the first three months of 2020 (which are described in Note 4) has been incorporated into our reporting units as they existed as of December 31, 2019. There were no other changes to the composition of our reporting units for the three months ended March 31, 2020.

Since December 31, 2019, there have been no changes to our accounting polices related to the accounting for goodwill. As of December 31, 2019, no factors were identified that would alter our October 1, 2019 goodwill impairment analysis. During the first quarter of 2020, we concluded that we had a triggering event related to our Fine Arts reporting unit, requiring us to perform an interim goodwill impairment test. The primary factor contributing to our conclusion was the expected impact of the COVID-19 pandemic to this particular business and its customers and revenue sources, which caused us to believe it was more likely than not that the carrying value of our Fine Arts reporting unit exceeded its fair value. During the first quarter of 2020, we performed an interim goodwill impairment test for our Fine Arts reporting unit utilizing a discounted cash flow model, with updated assumptions on future revenues, operating expenditures and capital expenditures. As a result of the interim goodwill impairment test, we concluded that the fair value of our Fine Arts reporting unit was less than its carrying value and, therefore, we recorded a $23,000 impairment charge on the goodwill associated with this reporting unit during the first quarter of 2020. The remaining goodwill for this reporting unit as of March 31, 2020 is approximately $15,000. Factors that may impact these assumptions include, but are not limited to: (i) our ability to maintain, or grow, storage rental and service revenues in line with current expectations and (ii) our ability to manage our fixed and variable costs in line with potential future revenue declines.

Additionally, we concluded that, as of March 31, 2020, we did not have a triggering event requiring an interim impairment test on the goodwill associated with our other reporting units. However, the duration and severity of the COVID-19 pandemic, as well as the related economic impact on both our business and the businesses of our customers, remain uncertain as of the filing of this Quarterly Report. Any material adverse changes to our businesses that negatively impact their fair values could result in future goodwill impairments.

The changes in the carrying value of goodwill attributable to each reportable operating segment for the three months ended March 31, 2020 are as follows:



	Global RIM Business			Global Data Center Business			Corporate and Other Business			Total Consolidated
Goodwill balance, net of accumulated amortization as of December 31, 2019	$	3,942,901		$	424,568		$	117,740		$	4,485,209
Non-deductible goodwill acquired during the year	60,018			—			—			60,018
Goodwill impairment	—			—			(23,000		)	(23,000		)
Fair value and other adjustments(1)	(4,854		)	—			403			(4,451		)
Currency effects	(141,752		)	(2,547		)	(974		)	(145,273		)
Goodwill balance, net accumulated amortization as of March 31, 2020	$	3,856,313		$	422,021		$	94,169		$	4,372,503
Accumulated Goodwill Impairment Balance as of December 31, 2019	$	132,409		$	—		$	3,011		$	135,420
Accumulated Goodwill Impairment Balance as of March 31, 2020	$	132,409		$	—		$	26,011		$	158,420

________________________________________________________________


(1)	Total fair value and other adjustments include $(4,451) in net adjustments primarily related to customer relationships.

Finite-lived Intangible Assets and Liabilities

Finite-lived intangible assets and liabilities are primarily comprised of customer relationship intangible assets, customer inducements and data center intangible assets and liabilities. Since December 31, 2019, there have been no changes to our accounting policies related to the accounting for any of our finite-lived intangible assets and liabilities as disclosed in Note 2.i. to Notes to Consolidated Financial Statements included in our Annual Report.

The gross carrying amount and accumulated amortization of our finite-lived intangible assets as of March 31, 2020 and December 31, 2019 are as follows:



	March 31, 2020							December 31, 2019
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Assets:
Customer relationship intangible assets	$	1,734,034	$	(544,952	)	$	1,189,082	$	1,751,848	$	(544,721	)	$	1,207,127
Customer inducements	55,571		(30,370		)	25,201		52,718		(29,397		)	23,321
Data center lease-based intangible assets(1)	264,631		(114,971		)	149,660		265,945		(103,210		)	162,735
Third-party commissions asset(2)	31,708		(5,277		)	26,431		31,708		(4,134		)	27,574
	$	2,085,944	$	(695,570	)	$	1,390,374	$	2,102,219	$	(681,462	)	$	1,420,757
Liabilities:
Data center below-market leases	$	12,729	$	(4,393	)	$	8,336	$	12,750	$	(3,937	)	$	8,813

_______________________________________________________________


(1)	Includes data center in-place lease intangible assets, data center tenant relationship intangible assets and data center above-market in-place lease intangible assets.

(2)

Third-party commissions asset is included in Other, a component of Other assets, net in the accompanying Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019. The third-party commissions asset is primarily comprised of additional payments associated with the execution of future customer contracts through the one-year anniversary of the acquisition of IO Data Centers, LLC ("IODC").

Amortization expense associated with finite-lived intangible assets, revenue reduction associated with the amortization of customer inducements and revenue reduction associated with the amortization of data center above-market leases and data center below-market leases for the three months ended March 31, 2020 and 2019 are as follows:



	Three Months Ended March 31,
	2020		2019
Amortization expense included in depreciation and amortization associated with:
Customer relationship and customer inducement intangible assets	$	26,764	$	27,881
Data center in-place leases and tenant relationships	11,353		12,609
Third-party commissions asset and other finite-lived intangible assets	2,363		757
Revenue reduction associated with amortization of:
Permanent withdrawal fees	$	2,465	$	2,740
Data center above-market leases and data center below-market leases	217		905

c. Revenues

Since December 31, 2019, there have been no changes to our accounting policies related to the accounting for revenues as disclosed in Note 2.l. to Notes to Consolidated Financial Statements included in our Annual Report.

The costs of the initial intake of customer records into physical storage ("Intake Costs") and capitalized commissions asset (collectively, "Contract Fulfillment Costs") as of March 31, 2020 and December 31, 2019 are as follows:



		March 31, 2020							December 31, 2019
Description	Location in Balance Sheet	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intake Costs asset	Other (within Other Assets, Net)	$	40,585	$	(23,615	)	$	16,970	$	41,224	$	(23,579	)	$	17,645
Capitalized commissions asset	Other (within Other Assets, Net)	73,638		(31,259		)	42,379		68,008		(27,178		)	40,830

Amortization expense associated with the Intake Costs asset and capitalized commissions asset for the three months ended March 31, 2020 and 2019 are as follows:



	Three Months Ended March 31,
	2020		2019
Intake Costs asset	$	2,779	$	2,679
Capitalized commissions asset	5,625		3,946

Deferred revenue liabilities are reflected in our Condensed Consolidated Balance Sheets as follows:



Description	Location in Balance Sheet	March 31, 2020		December 31, 2019
Deferred revenue - Current	Deferred revenue	$	260,399	$	274,036
Deferred revenue - Long-term	Other Long-term Liabilities	34,783		36,029

Data Center Lessor Considerations

Our Global Data Center Business features storage rental provided to customers at contractually specified rates over a fixed contractual period, which are accounted for in accordance with ASU 2016-02. Since December 31, 2019, there have been no changes to our accounting policies related to the accounting for our lessor revenue as disclosed in Note 2.l. to Notes to Consolidated Financial Statements included in our Annual Report. Storage rental revenue, including revenue associated with power and connectivity, associated with our Global Data Center Business for the three months ended March 31, 2020 and 2019 are as follows:



	Three Months Ended March 31,
	2020		2019
Storage rental revenue(1)	$	64,595	$	59,718

______________________________________________________________

(1)

Revenue associated with power and connectivity included within storage rental revenue was $11,413 and $9,118 for the three months ended March 31, 2020 and 2019, respectively.

d. Accounts Receivable

In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-13, Financial Instruments-Credit Losses-Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 changes how entities will measure credit losses on most financial assets. The standard eliminates the probable initial recognition of estimated losses and provides a forward-looking expected credit loss model for accounts receivable, loans and other financial instruments.

Prior to our adoption of ASU 2016-13, we maintained an allowance for doubtful accounts for estimated losses resulting from the potential inability of our customers to make required payments and potential disputes regarding billing and service issues. When calculating the allowance, we considered our past loss experience, current and prior trends in our aged receivables and credit memo activity, current economic conditions, and specific circumstances of individual receivable balances. If the financial condition of our customers were to significantly change, resulting in a significant improvement or impairment of their ability to make payments, an adjustment of the allowance might have been required. Additionally, we write off uncollectible balances as circumstances warrant, generally, no later than one year past due.

On January 1, 2020 we adopted ASU 2016-13 on a modified retrospective basis for all financial assets measured at amortized cost. The adoption of ASU 2016-13 did not result in a material impact on our consolidated financial statements. In accordance with the guidance in ASU 2016-13, we now calculate and monitor our allowance considering future potential economic and macroeconomic conditions and reasonable and supportable forecasts for expected future collectability of our outstanding receivables, in addition to the factors identified above. Our considerations when calculating our allowance include, but are not limited to, the following: the location of our businesses, the composition of our customer base, our product and service lines, potential future economic unrest, and potential future macroeconomic factors, including natural disasters and any impacts associated with the COVID-19 pandemic. Continued adjustments will be made should there be any material change to reasonable and supportable forecasts that may impact our likelihood of collection, as it becomes evident, including the effects of the COVID-19 pandemic. Our financial assets measured at amortized cost that potentially subject us to credit risk consist predominantly of our accounts receivable. Our highly diverse global customer base, with no single customer accounting for more than 1% of revenue during the three months ended March 31, 2020, limits our exposure to concentration of credit risk. However, the COVID-19 pandemic is impacting numerous industries and geographies globally. We continue to monitor the credit worthiness of our customers, customer payment trends and the adequacy of our bad debt allowance as the COVID-19 pandemic continues.

The rollforward of allowance for doubtful accounts and credit memo reserves for the three months ended March 31, 2020 is as follows:



	Allowance for Doubtful Accounts and Credit Memo Reserves
Balance at December 31, 2019	$	42,856
Credit memos charged to revenue	13,030
Allowance for bad debts charged to expense	6,197
Deductions and other(1)	(18,062		)
Balance at March 31, 2020	$	44,021

______________________________________________________________

(1)

Primarily consists of the issuance of credit memos, the write-off of accounts receivable and the impact associated with currency translation adjustments.

e. Leases

We lease facilities for certain of our warehouses, data centers and office space. We also have land leases, including those on which certain of our facilities are located. Since December 31, 2019 there have been no changes to our accounting policies related to the accounting for leases as disclosed in Note 2.m. to Notes to Consolidated Financial Statements included in our Annual Report.

Operating and financing lease right-of-use assets and lease liabilities as of March 31, 2020 and December 31, 2019 are as follows:



Description	Location in Balance Sheet	March 31, 2020		December 31, 2019
Assets:
Operating lease right-of-use assets(1)	Operating lease right-of-use assets	$	1,906,678	$	1,869,101
Financing lease right-of-use assets, net of accumulated depreciation(2)	Property, Plant and Equipment, Net	316,422		327,215
Total		$	2,223,100	$	2,196,316
Liabilities:
Current
Operating lease liabilities	Accrued expenses and other current liabilities	$	229,331	$	223,249
Financing lease liabilities	Current portion of long-term debt	44,427		46,582
Total current lease liabilities		273,758		269,831
Long-term
Operating lease liabilities	Long-term Operating Lease Liabilities, net of current portion	1,760,478		1,728,686
Financing lease liabilities	Long-term Debt, net of current portion	312,415		320,600
Total long-term lease liabilities		2,072,893		2,049,286
Total		$	2,346,651	$	2,319,117

_______________________________________________________________

(1) At March 31, 2020, these assets are comprised of approximately 99% real estate related assets (which include land, buildings and racking) and 1% non-real estate related assets (which include warehouse equipment, vehicles, furniture and fixtures and computer hardware and software). At December 31, 2019, these assets are comprised of approximately 99% real estate related assets (which include land, buildings and racking) and 1% non-real estate related assets (which include warehouse equipment, vehicles, furniture and fixtures and computer hardware and software).

(2) At March 31, 2020, these assets are comprised of approximately 69% real estate related assets and 31% non-real estate related assets. At December 31, 2019, these assets are comprised of approximately 69% real estate related assets and 31% non-real estate related assets.

The components of the lease expense for the three months ended March 31, 2020 and 2019 are as follows:



		Three Months Ended March 31,
Description	Location in Statement of Operations	2020		2019
Operating lease cost(1)	Cost of sales and Selling, general and administrative	$	123,289	$	111,906
Financing lease cost:
Depreciation of financing lease right-of-use assets	Depreciation and amortization	$	12,955	$	16,329
Interest expense for financing lease liabilities	Interest Expense, Net	4,844		6,142
Total financing lease cost		$	17,799	$	22,471

_______________________________________________________________

(1) Of the $123,289 incurred for the three months ended March 31, 2020, $120,315 is included within Cost of sales and $2,974 is included within Selling, general and administrative expenses. Operating lease cost includes variable lease costs of $27,805 for the three months ended March 31, 2020. Of the $111,906 incurred for the three months ended March 31, 2019, $108,601 is included within Cost of sales and $3,305 is included within Selling, general and administrative expenses. Operating lease cost includes variable lease costs of $25,489 for the three months ended March 31, 2019.

Other than the lease agreement entered into during the fourth quarter of 2019 in the United Kingdom for a facility that is currently under construction, as disclosed in Note 2.m. to Notes to Consolidated Financial Statement included in our Annual Report, we do not have any material operating or financing leases that are signed but have not yet commenced as of March 31, 2020. In addition, as of March 31, 2020, we do not have any operating or financing leases with related parties that are material to our consolidated financial statements.

Other information: Supplemental cash flow information relating to our leases for the three months ended March 31, 2020 and 2019 is as follows:



	Three Months Ended March 31,
Cash paid for amounts included in measurement of lease liabilities:	2020		2019
Operating cash flows used in operating leases	$	86,418	$	83,676
Operating cash flows used in financing leases (interest)	4,844		6,142
Financing cash flows used in financing leases	12,739		16,675
Non-cash items:
Operating lease modifications and reassessments	$	34,916	$	1,842
New operating leases (including acquisitions)	110,609		21,535
New financing leases, modifications and reassessments	13,061		7,523

f. Stock-Based Compensation

We record stock-based compensation expense, utilizing the straight-line method, for the cost of stock options, restricted stock units ("RSUs"), performance units ("PUs") and shares of stock issued under our employee stock purchase plan (together, "Employee Stock-Based Awards"). There have been no significant changes to our accounting policies, assumptions and valuation methodologies related to the accounting for our Employee Stock-Based Awards as disclosed in Note 2.n. to Notes to Consolidated Financial Statements included in our Annual Report.

Stock-based compensation expense for Employee Stock-Based Awards for the three months ended March 31, 2020 and 2019 was $6,527 ($6,065 after tax or $0.02 per basic and diluted share) and $8,519 ($7,935 after tax or $0.03 per basic and diluted share), respectively. The substantial majority of the stock-based compensation expense for Employee Stock-Based Awards is included in Selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Operations. As of March 31, 2020, unrecognized compensation cost related to the unvested portion of our Employee Stock-Based Awards was $73,265 and is expected to be recognized over a weighted-average period of 2.1 years.

Stock Options

A summary of stock option activity for the three months ended March 31, 2020 is as follows:



	Stock Options
Outstanding at December 31, 2019	4,835,721
Granted	589,993
Exercised	(135,312	)
Forfeited	(65,861	)
Expired	(40,749	)
Outstanding at March 31, 2020	5,183,792
Options exercisable at March 31, 2020	3,786,186
Options expected to vest	1,320,231

Restricted Stock Units

The fair value of RSUs vested during the three months ended March 31, 2020 and 2019 is as follows:



	Three Months Ended March 31,
	2020		2019
Fair value of RSUs vested	$	18,379	$	15,333

A summary of RSU activity for the three months ended March 31, 2020 is as follows:



	RSUs
Non-vested at December 31, 2019	1,203,599
Granted	866,416
Vested	(526,086	)
Forfeited	(32,661	)
Non-vested at March 31, 2020	1,511,268
RSUs expected to vest	1,480,838

Performance Units

The fair value of earned PUs that vested during the three months ended March 31, 2020 and 2019 is as follows:



	Three Months Ended March 31,
	2020		2019
Fair value of earned PUs that vested	$	10,890	$	6,503

A summary of PU activity for the three months ended March 31, 2020 is as follows:



	Original PU Awards		PU Adjustment(1)		Total PU Awards
Non-vested at December 31, 2019	1,113,691		(314,798	)	798,893
Granted	425,777		—		425,777
Vested	(271,452	)	—		(271,452	)
Forfeited/Performance or Market Conditions Not Achieved	(36,961	)	(4,710	)	(41,671	)
Non-vested at March 31, 2020	1,231,055		(319,508	)	911,547

________________________________________________________________


(1)	Represents an increase or decrease in the number of original PUs awarded based on either the final performance criteria or market condition achievement at the end of the performance period of such PUs.

As of March 31, 2020, we expected 100%, 100% and 0% achievement of each of the predefined revenue, return on invested capital and Adjusted EBITDA (as defined in Note 6) targets associated with the awards of PUs made in 2020, 2019 and 2018, respectively.

g. Income (Loss) Per Share—Basic and Diluted

Basic income (loss) per common share is calculated by dividing income (loss) by the weighted average number of common shares outstanding. The calculation of diluted income (loss) per share is consistent with that of basic income (loss) per share but gives effect to all potential common shares (that is, securities such as stock options, RSUs, PUs, warrants or convertible securities) that were outstanding during the period, unless the effect is antidilutive.

The calculation of basic and diluted income (loss) per share for the three months ended March 31, 2020 and 2019 are as follows:



	Three Months Ended March 31,
	2020		2019
Income (loss) from continuing operations	$	64,892	$	30,476
Less: Net income (loss) attributable to noncontrolling interests	917		891
Income (loss) from continuing operations (utilized in numerator of Earnings Per Share calculation)	63,975		29,585
(Loss) income from discontinued operations, net of tax	—		(24		)
Net income (loss) attributable to Iron Mountain Incorporated	$	63,975	$	29,561

Weighted-average shares—basic	287,840,000		286,528,000
Effect of dilutive potential stock options	51,799		231,402
Effect of dilutive potential RSUs and PUs	467,334		732,421
Weighted-average shares—diluted	288,359,133		287,491,823

Earnings (losses) per share—basic:
Income (loss) from continuing operations	$	0.22	$	0.10
(Loss) income from discontinued operations, net of tax	—		—
Net income (loss) attributable to Iron Mountain Incorporated(1)	$	0.22	$	0.10

Earnings (losses) per share—diluted:
Income (loss) from continuing operations	$	0.22	$	0.10
(Loss) income from discontinued operations, net of tax	—		—
Net income (loss) attributable to Iron Mountain Incorporated(1)	$	0.22	$	0.10

Antidilutive stock options, RSUs and PUs, excluded from the calculation	5,513,714		3,985,161

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(1)

Columns may not foot due to rounding.

h. Income Taxes

We provide for income taxes during interim periods based on our estimate of the effective tax rate for the year. Discrete items and changes in our estimate of the annual effective tax rate are recorded in the period they occur. Our effective tax rate is subject to variability in the future due to, among other items: (1) changes in the mix of income between our qualified REIT subsidiaries ("QRSs") and our domestic taxable REIT subsidiaries ("TRSs"), as well as among the jurisdictions in which we operate; (2) tax law changes; (3) volatility in foreign exchange gains and losses; (4) the timing of the establishment and reversal of tax reserves; and (5) our ability to utilize net operating losses that we generate.

Our effective tax rates for the three months ended March 31, 2020 and 2019 were 13.0% and 25.7%, respectively. The primary reconciling items between the federal statutory tax rate of 21.0% and our overall effective tax rate for the three months ended March 31, 2020 and 2019 were the benefits derived from the dividends paid deduction and the impacts of differences in the tax rates at which our foreign earnings are subject, including foreign exchange gains and losses in different jurisdictions with different tax rates.

i. Fair Value Measurements

Our financial assets or liabilities that are carried at fair value are required to be measured using inputs from the three levels of the fair value hierarchy as disclosed in Note 2.s. to Notes to Consolidated Financial Statements included in our Annual Report.

The assets and liabilities carried at fair value measured on a recurring basis as of March 31, 2020 and December 31, 2019, respectively, are as follows:



			Fair Value Measurements at March 31, 2020 Using
Description	Total Carrying Value at March 31, 2020		Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Money Market Funds(1)	$	9,194	$	—		$	9,194		$	—
Trading Securities	10,131		9,582		(2)	549		(3)	—
Derivative Assets(4)	5,388		—			5,388			—
Derivative Liabilities(4)	23,506		—			23,506			—



			Fair Value Measurements at December 31, 2019 Using
Description	Total Carrying Value at December 31, 2019		Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Money Market Funds(1)	$	13,653	$	—		$	13,653		$	—
Trading Securities	10,732		10,168		(2)	564		(3)	—
Derivative Liabilities(4)	9,756		—			9,756			—

________________________________________________________________


(1)	Money market funds are measured based on quoted prices for similar assets and/or subsequent transactions.


(2)	These trading securities are measured at fair value using unadjusted quoted market prices in active markets for identical assets that we have the ability to access at the measurement date.


(3)	These trading securities are measured based on inputs that are observable, other than quoted market prices.

(4)

Derivative assets and liabilities include (i) interest rate swap agreements, including forward-starting interest rate swap agreements, to limit our exposure to changes in interest rates on a portion of our floating rate indebtedness and (ii) cross-currency swap agreements to hedge the variability of exchange rates impacts between the United States dollar and the Euro and certain of our Euro denominated subsidiaries. Our derivative financial instruments are measured using industry standard valuation models using market-based observable inputs, including interest rate curves, forward and spot prices for currencies and implied volatilities. Credit risk is also factored into the determination of the fair value of our derivative financial instruments. See Note 3 for additional information on our derivative financial instruments.

Disclosures are required in the financial statements for items measured at fair value on a non-recurring basis. There were no material items that are measured at fair value on a non-recurring basis at March 31, 2020 and December 31, 2019, other than (i) those disclosed in Note 2.s. to Notes to Consolidated Financial Statements included in our Annual Report, (ii) those acquired in acquisitions that occurred during the three months ended March 31, 2020, as described in Note 4, and (iii) the Fine Arts reporting unit, as described in Note 2.b., all of which are based on Level 3 inputs.

We account for our investment in the MakeSpace JV (the "MakeSpace Investment") as an equity method investment. The carrying value of the MakeSpace Investment at March 31, 2020 and December 31, 2019 is $14,316 and $18,570, respectively, and is presented as a component of Other within Other assets, net in our Condensed Consolidated Balance Sheets.

The fair value of our long-term debt, which is determined based on either Level 1 inputs or Level 3 inputs, is disclosed in Note 5 and is measured at cost in our Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019.

j. Accumulated Other Comprehensive Items, Net

The changes in accumulated other comprehensive items, net for the three months ended March 31, 2020 and 2019, are as follows:



	Three Months Ended March 31, 2020									Three Months Ended March 31, 2019
	Foreign Currency Translation Adjustments			Change in Fair Value of Derivative Instruments			Total			Foreign Currency Translation Adjustments			Change in Fair Value of Derivative Instruments			Total
Beginning of Period	$	(252,825	)	$	(9,756	)	$	(262,581	)	$	(264,691	)	$	(973	)	$	(265,664	)
Other comprehensive (loss) income:
Foreign currency translation adjustment	(222,305		)	—			(222,305		)	17,378			—			17,378
Change in fair value of derivative instruments	—			(8,362		)	(8,362		)	—			(2,674		)	(2,674		)
Total other comprehensive (loss) income	(222,305		)	(8,362		)	(230,667		)	17,378			(2,674		)	14,704
End of Period	$	(475,130	)	$	(18,118	)	$	(493,248	)	$	(247,313	)	$	(3,647	)	$	(250,960	)

k. Other (Income) Expense, Net

Other (income) expense, net for the three months ended March 31, 2020 and 2019 consists of the following:



	Three Months Ended March 31,
	2020			2019
Foreign currency transaction (gains) losses, net(1)	$	(37,399	)	$	17,697
Other, net(2)	(5,327		)	(2,487		)
Other (Income) Expense, Net	$	(42,726	)	$	15,210

_______________________________________________________________

(1) The gain or loss on foreign currency transactions, calculated as the difference between the historical exchange rate and the exchange rate at the applicable measurement date, includes gains or losses related to (i) borrowings in certain foreign currencies under our Revolving Credit Facility (as defined and discussed more fully in Note 5), (ii) our Euro Notes (as defined in Note 5) and (iii) certain foreign currency denominated intercompany obligations of our foreign subsidiaries to us and between our foreign subsidiaries, which are not considered permanently invested (as more fully discussed in Note 3).

(2) Other, net for the three months ended March 31, 2020, is primarily comprised of a gain on our previously held 25% equity investment in OSG Records Management (Europe) Limited ("OSG"), as more fully discussed in Note 4, which is partially offset by losses on certain of our equity method investments.

l. New Accounting Pronouncements

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which makes a number of changes meant to add, modify or remove certain disclosure requirements associated with the movement of our financial assets and liabilities among the three levels of the fair value hierarchy. We adopted ASU 2018-13 on January 1, 2020. ASU 2018-13 did not have a material impact on our consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13. We adopted ASU 2016-13 on January 1, 2020 on a modified retrospective basis. See Note 2.d. for information regarding the impact of the adoption of ASU 2016-13 on our consolidated financial statements.

m. Change in Presentation

We have historically classified our significant acquisition costs which represent operating expenditures associated with (1) the acquisition of Recall Holdings Limited ("Recall") that we completed on May 2, 2016 (the "Recall Transaction"), including: (i) advisory and professional fees to complete the Recall Transaction; (ii) costs associated with the divestments required in connection with receipt of regulatory approvals (including transitional services); and (iii) costs to integrate Recall with our existing operations, including moving, severance, facility upgrade, REIT integration and system upgrade costs, as well as certain costs associated with our shared service center initiative for our finance, human resources and information technology functions; and (2) the advisory and professional fees to complete the acquisition of IODC (collectively, "Significant Acquisition Costs"), as components of Selling, general and administrative expenses and Cost of sales. Beginning in the fourth quarter of 2019, we present Significant Acquisition Costs as its own line item within Operating Expenses in our Condensed Consolidated Statements of Operations. The prior period has been conformed to this presentation.

The following table sets forth the effect of the change in presentation of Significant Acquisition Costs to certain line items of our Condensed Consolidated Statement of Operations for the three months ended March 31, 2019:



	Three Months Ended March 31, 2019
Cost of sales (excluding depreciation and amortization)	$	(898	)
Selling, general and administrative	$	(1,848	)
Significant Acquisition Costs	$	2,746

There were no Significant Acquisition Costs for the three months ended March 31, 2020 as all of the costs associated with the Recall Transaction and IODC were incurred as of December 31, 2019. Significant Acquisition Costs included in the accompanying Condensed Consolidated Statements of Operations by segment for the three months ended March 31, 2019 is as follows:



	Three Months Ended March 31, 2019
Global RIM Business	$	880
Global Data Center Business	143
Corporate and Other Business	1,723
Total Significant Acquisition Costs	$	2,746