XML 41 R29.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Recent Accounting Pronouncements (Tables) | 9 Months Ended
--- | ---
Sep. 30, 2018
Accounting Changes and Error Corrections [Abstract] |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The following table provides a brief description of accounting pronouncements adopted during the nine months ended September 30, 2018 and recent accounting pronouncements that could have a material effect on our financial statements:
Standard |  | Description |  | Date/Method of Adoption |  | Effect on financial statements or other significant matters
Adopted During the Nine Months Ended September 30, 2018
ASU 2014–09 |  | This standard supersedes most existing revenue recognition guidance under GAAP. The new revenue recognition standard requires entities to recognize revenue for the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. |  | The Company adopted this standard on January 1, 2018 using the modified retrospective approach to those contracts that were not completed as of January 1, 2018. Adoption resulted in a cumulative adjustment to retained earnings as of the effective date, without restatement of prior period amounts. |  | The Company’s revenue from discount and interchange, transaction processing and certain fees is within the scope of Topic 606. FASB and its Transition Resource Group have issued clarifications on various aspects of ASU 2014–09. There were three primary impacts to the Company resulting from the adoption of Topic 606, which are described below. Certain amounts paid to partners in our Fleet Solutions and Travel and Corporate Solutions segments have been determined to fall under the “cost to obtain a contract” guidance. As a result, these amounts, which were previously presented as a reduction of revenues, are now reflected within sales and marketing on our unaudited condensed consolidated statements of income. This change increased both reported revenues and expenses for the three and nine months ended September 30, 2018 by approximately $13.8 million and $44.9 million, respectively. Network fees paid by all three of our segments, but primarily by our Travel and Corporate Solutions segment, are now presented as a reduction of revenues in our unaudited condensed consolidated statements of income. Prior to January 1, 2018, these amounts were included within service fees. This change reduced both reported revenues and expenses by approximately $3.4 million and $13.5 million for the three and nine months ended September 30, 2018, respectively. Certain costs to obtain a contract, such as sales commissions, are to be capitalized and amortized over the life of the customer relationship, with a practical expedient available for contracts under one year in duration. The vast majority of the Company’s commissions will continue to be expensed as incurred. This change resulted in an immaterial impact to operating income for the three and nine months ended September 30, 2018. As of January 1, 2018, we recorded $0.6 million cumulative-effect adjustment, net of the associated tax effect, related to the deferral of capitalizable costs to obtain a contract within our Health and Employee Benefit Solutions segment. These commissions are amortized to sales and marketing expense over a useful life that considers the contract term, our commission policy, renewal experience and the transfer of services to which the asset relates.
ASU 2017–07 |  | This standard changes the presentation of net benefit pension costs by requiring the disaggregation of certain of its components. Under the guidance, companies are required to present the service cost component in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. The other components of net benefit cost will be presented in the income statement separately from the service cost component and outside the subtotal of operating income, if one is presented. Additionally, only the service cost component will be eligible for capitalization under the new guidance. |  | The Company adopted ASU 2017–07 effective January 1, 2018. |  | The adoption did not have a material impact on our results of operations, cash flows or consolidated financial position.
ASU 2016–18 |  | This standard clarifies the classification and presentation of restricted cash in the statement of cash flows. Upon adoption, the statement of cash flows must explain the change during the period in the total of cash and cash equivalents and amounts described as restricted cash or cash equivalents. |  | The Company retrospectively adopted ASU 2016–18 effective January 1, 2018. |  | This retrospective adoption resulted in including restricted cash in cash, cash equivalents and restricted cash when reconciling the beginning of year and end of year amounts presented on the unaudited condensed consolidated statements of cash flows. A reconciliation of cash, cash equivalents and restricted cash as reported within our unaudited condensed consolidated balance sheets is included within our unaudited condensed consolidated statements of cash flows.
ASU 2016–01 |  | This standard requires equity investments, except those accounted for under the equity method of accounting, or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income. |  | The Company adopted ASU 2016–01 effective January 1, 2018. |  | Changes in the fair value of investment securities are now reflected as non-operating income within our unaudited condensed consolidated statements of income. The adoption did not have a material impact on our results of operations, balance sheet or cash flows.
Not Yet Adopted as of September 30, 2018
ASU 2016–02 |  | This standard increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Certain qualitative and quantitative disclosures are required. |  | The Company plans to adopt ASU 2016–02 effective January 1, 2019 using the modified retrospective method provided under ASU 2018–11 Leases (Topic 842): Targeted Improvements. |  | The Company has established an ASU 2016–02 committee whose primary objectives include implementing a new software solution, reviewing and summarizing lease contracts, establishing completeness over the lease population, determining which practical expedients, if any, we will utilize to facilitate compliance and updating the Company’s accounting policies and procedures. The Company expects to recognize right-of-use assets and corresponding lease liabilities on the Company’s consolidated balance sheet following the adoption of ASU 2016–02, but the Company is not able to quantify the impact of adoption at this time. The Company is also evaluating the impact the standard will have on its consolidated statement of operations, consolidated statement of cash flows and related disclosures
ASU 2016–13 |  | This standard requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses will be based on historical experience, current conditions and reasonable and supportable forecasts that impact the collectability of the reported amount. |  | The standard is effective January 1, 2020. |  | The Company is evaluating the impact the standard will have on its consolidated financial statements and related disclosures.
ASU 2018–15 |  | This standard clarifies the accounting for capitalizing implementation costs in a cloud computing arrangement that is a service contract. The standard provides that implementation costs be treated using the same criteria used for internal-use software development costs, with amortization expense being recorded in the same income statement expense line as the hosted service costs and over the expected term of the hosting arrangement. |  | The standard is effective January 1, 2020. |  | The Company is evaluating the impact the standard will have on its consolidated financial statements and related disclosures.
The impact of adopting Topic 606 for the three and nine months ended September 30, 2018 was as follows:
| Three Months Ended September 30, 2018 |  | Nine Months Ended September 30, 2018
(In thousands) | Prior to Adoption |  | Impact of Topic 606 |  | As Reported |  | Prior to Adoption |  | Impact of Topic 606 |  | As Reported
Revenues |  |  |  |  |  |  |  |  |  |  |
Payment processing revenue | $ | 174,170 |  |  | $ | 8,701 |  |  | $ | 182,871 |  |  | $ | 501,674 |  |  | $ | 28,389 |  |  | $ | 530,063 |
Account servicing revenue | 78,748 |  |  | — |  |  | 78,748 |  |  | 236,168 |  |  | — |  |  | 236,168 |
Finance fee revenue | 53,703 |  |  | — |  |  | 53,703 |  |  | 154,958 |  |  | — |  |  | 154,958 |
Other revenue | 65,682 |  |  | 1,686 |  |  | 67,368 |  |  | 183,997 |  |  | 3,209 |  |  | 187,206 |
Total revenues | 372,303 |  |  | 10,387 |  |  | 382,690 |  |  | 1,076,797 |  |  | 31,598 |  |  | 1,108,395 |
Cost of services |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Processing costs | 79,580 |  |  | — |  |  | 79,580 |  |  | 235,508 |  |  | — |  |  | 235,508 |
Service fees | 17,234 |  |  | (3,416 | ) |  | 13,818 |  |  | 53,310 |  |  | (13,463 | ) |  | 39,847 |
Provision for credit losses | 21,435 |  |  | — |  |  | 21,435 |  |  | 46,930 |  |  | — |  |  | 46,930 |
Operating interest | 10,268 |  |  | — |  |  | 10,268 |  |  | 28,281 |  |  | — |  |  | 28,281 |
Depreciation and amortization | 19,013 |  |  | — |  |  | 19,013 |  |  | 60,058 |  |  | — |  |  | 60,058 |
Total cost of services | 147,530 |  |  | (3,416 | ) |  | 144,114 |  |  | 424,087 |  |  | (13,463 | ) |  | 410,624 |
General and administrative | 51,799 |  |  | — |  |  | 51,799 |  |  | 155,720 |  |  | — |  |  | 155,720 |
Sales and marketing | 40,846 |  |  | 13,765 |  |  | 54,611 |  |  | 123,996 |  |  | 44,853 |  |  | 168,849 |
Depreciation and amortization | 29,054 |  |  | — |  |  | 29,054 |  |  | 88,817 |  |  | — |  |  | 88,817 |
Impairment charge | 2,424 |  |  | — |  |  | 2,424 |  |  | 2,424 |  |  | — |  |  | 2,424 |
Operating income | 100,650 |  |  | 38 |  |  | 100,688 |  |  | 281,753 |  |  | 208 |  |  | 281,961 |
Financing interest expense | (25,718 | ) |  | — |  |  | (25,718 | ) |  | (78,560 | ) |  | — |  |  | (78,560 | )
Net foreign currency loss | (1,094 | ) |  | — |  |  | (1,094 | ) |  | (27,438 | ) |  | — |  |  | (27,438 | )
Net unrealized gain on financial instruments | 2,157 |  |  | — |  |  | 2,157 |  |  | 18,371 |  |  | — |  |  | 18,371 |
Income before income taxes | 75,995 |  |  | 38 |  |  | 76,033 |  |  | 194,126 |  |  | 208 |  |  | 194,334 |
Income taxes | 18,741 |  |  | 10 |  |  | 18,751 |  |  | 48,222 |  |  | 56 |  |  | 48,278 |
Net income | 57,254 |  |  | 28 |  |  | 57,282 |  |  | 145,904 |  |  | 152 |  |  | 146,056 |
Less: Net (loss) income from non-controlling interest | (40 | ) |  | — |  |  | (40 | ) |  | 803 |  |  | — |  |  | 803 |
Net income attributable to shareholders | $ | 57,294 |  |  | $ | 28 |  |  | $ | 57,322 |  |  | $ | 145,101 |  |  | $ | 152 |  |  | $ | 145,253 |

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

X
- Definition 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. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22499-107794 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 270 -SubTopic 10 -Section 45 -Paragraph 13 -URI http://asc.fasb.org/extlink&oid=109236672&loc=d3e765-108305 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 270 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.10-01.(b)(6)) -URI http://asc.fasb.org/extlink&oid=27015980&loc=d3e46468-122699 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22580-107794 Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 270 -SubTopic 10 -Section 45 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=109236672&loc=d3e725-108305 Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22583-107794 + Details
Name: | us-gaap_ScheduleOfNewAccountingPronouncementsAndChangesInAccountingPrinciplesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration