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RECENT ACCOUNTING PRONOUNCEMENTS (Tables)

9 Months Ended

Sep. 30, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Schedule of New Accounting Pronouncements and Changes in Accounting Principles

doption of the new lease standard impacted our previously reported Consolidated Condensed Statements of Earnings and Comprehensive Income as follows (in millions, except per share amounts):

			Three months ended September 30, 2018																								Nine months ended September 30, 2018
			As Previously			Lessor			Lessee and Other									As Previously			Lessor			Lessee and Other
			Reported			Adjustments (1)			Adjustments (1)			As Revised						Reported			Adjustments (1)			Adjustments (1)			As Revised
Lease & related maintenance and rental revenues			$	895.2		1.2			0.4			896.8						$	2,577.4		2.0			1.0			2,580.4
Total revenues			2,158.1			1.2			0.4			2,159.7						6,150.9			2.0			1.0			6,153.8
Cost of lease & related maintenance and rental			649.4			(2.7)			—			646.7						1,905.0			(9.9)			—			1,895.1
Cost of services (2)			945.9			—			2.1			947.9						2,639.1			—			5.6			2,644.8
Other operating expenses			30.3			—			(0.3)			30.0						94.8			—			(1.1)			93.7
Selling, general and administrative expenses (2)			215.5			0.9			(0.8)			215.6						637.3			1.0			(2.2)			636.0
Used vehicle sales, net			3.0			0.2			—			3.2						16.4			(0.2)			—			16.2
Interest expense			47.4			—			0.5			47.8						127.5			—			1.2			128.8
Restructuring and other items, net (2)			0.3			—			(0.9)			(0.5)						19.7			—			(2.4)			17.3
Earnings from continuing operations before income taxes			116.1			2.9			(0.2)			118.9						262.5			11.2			(0.2)			273.5
Provision for income taxes			26.6			0.6			—			27.3						95.6			2.8			—			98.4
Earnings from continuing operations			89.5			2.3			(0.2)			91.6						167.0			8.4			(0.2)			175.1
Net earnings			88.8			2.3			(0.2)			90.8						164.5			8.4			(0.2)			172.6
Comprehensive income			100.6			1.9			—			102.5						156.4			9.5			—			165.9
Earnings per common share - Basic
Continuing operations			$	1.70		0.04			—			1.74						$	3.18		0.15			—			3.33
Net earnings			$	1.69		0.04			—			1.73						$	3.13		0.15			—			3.28
Earnings per common share - Diluted
Continuing operations			$	1.69		0.04			—			1.73						$	3.15		0.16			—			3.31
Net earnings			$	1.68		0.04			—			1.72						$	3.11		0.16			—			3.26

————————————

(1)We determined that in a prior period certain lessor arrangements of revenue earning equipment historically accounted for as operating leases should have been accounted for as direct financing leases. Additionally, we evaluated our leases for classification and determined that certain lessee arrangements, primarily real estate leases, historically accounted for as operating leases should have been accounted for as capital leases. The prior period error was corrected by reducing "Lease & related maintenance and rental revenues" by approximately $5 million and $14 million during the three and nine months ended September 30, 2018, respectively. We also reduced depreciation expense (included in "Cost of lease & related maintenance and rental") by approximately $5 million and $14 million during the three and nine months ended September 30, 2018, respectively. We concluded these errors were not material to any of our previously issued consolidated financial statements.

(2)Adjustments primarily reflect the reclassification of our Singapore operations into "Restructuring and other items, net," that were shut down during 2019.

Note: Amounts may not be additive due to rounding.

Adoption of the new lease standard impacted our previously reported Consolidated Condensed Balance Sheet as follows (in millions):

												December 31, 2018
												As Previously						Lessor						Lessee
												Reported						Adjustments (1)						Adjustments (1)						As Revised
Receivables, net																					$	1,219.4					22.6						—						1,242.1
Prepaid expenses and other current assets																					201.6						(23.3)						—						178.3
Total current assets																					1,568.4						(0.7)						—						1,567.7
Revenue earning equipment, net																					9,498.0						(84.2)						2.2						9,416.0
Operating property and equipment, net																					843.8						—						18.2						862.1
Sales-type leases and other assets																					606.6						156.8						204.3						967.8
Total assets																					13,051.1						72.0						224.7						13,347.8
Short-term debt and current portion of long term-debt																					930.0						—						7.2						937.1
Accrued expenses and other current liabilities																					630.5						145.1						72.2						847.7
Total current liabilities																					2,292.3						145.1						79.3						2,516.7
Long-term debt																					5,693.6						—						18.5						5,712.1
Other non-current liabilities																					849.9						421.2						131.5						1,402.6
Deferred income taxes																					1,304.8						(124.6)						(0.5)						1,179.7
Total liabilities																					10,140.8						441.7						228.8						10,811.2
Retained earnings																					2,710.7						(369.6)						(3.8)						2,337.3
Accumulated other comprehensive loss																					(911.3)						(0.1)						(0.2)						(911.6)
Total shareholders' equity																					2,910.3						(369.7)						(4.1)						2,536.6
Total liabilities and shareholders' equity																					13,051.1						72.0						224.7						13,347.8

————————————

(1)We determined that in a prior period certain lessor arrangements of revenue earning equipment historically accounted for as operating leases should have been accounted for as direct financing leases. Additionally, we evaluated our leases for classification and determined that certain lessee arrangements, primarily real estate leases, historically accounted for as operating leases should have been accounted for as capital leases. The prior period error was corrected by increasing "Receivables, net" by approximately $24 million and also increasing sales-type leases and other assets by approximately $65 million and reducing "Revenue earning equipment, net" by approximately $83 million. We concluded these errors were not material to any of our previously issued consolidated financial statements.

Note: Amounts may not be additive due to rounding.

Adoption of the new lease standard impacted our previously reported Consolidated Condensed Statements of Cash Flows as follows (in millions):

			Nine months ended September 30, 2018
			As Previously Reported						New Lease Standard Adjustments						As Revised
Net earnings			$	164.5					8.1						172.6
Earnings from continuing operations			167.0						8.1						175.1
Depreciation expense			1,028.5						(6.5)						1,022.0
Used vehicle sales, net			16.4						(0.2)						16.2
Amortization expense and other non-cash charges, net			21.2						83.7						104.9
Deferred income tax expense			103.1						2.8						105.9
Collections on sales-type leases and other items			—						63.3						63.3
Changes in operating assets and liabilities:
Prepaid expenses and other assets			(27.2)						(77.3)						(104.5)
Accrued expenses and other non-current liabilities			(6.7)						(10.7)						(17.4)
Net cash provided by operating activities from continuing operations			1,212.4						63.2						1,275.6
Debt repaid			(466.1)						(5.6)						(471.7)
Net cash provided by financing activities from continuing operations			784.9						(5.6)						779.2
Collections on direct finance leases and other items			57.6						(57.6)						—
Net cash used in investing activities from continuing operations			(2,018.2)						(57.6)						(2,075.8)

Note: Amounts may not be additive due to rounding.

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Tabular disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.

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