<SEC-DOCUMENT>0001193125-21-032538.txt : 20210520
<SEC-HEADER>0001193125-21-032538.hdr.sgml : 20210520
<ACCEPTANCE-DATETIME>20210208172856
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ACCESSION NUMBER:		0001193125-21-032538
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20210208

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			KORN FERRY
		CENTRAL INDEX KEY:			0000056679
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-EMPLOYMENT AGENCIES [7361]
		IRS NUMBER:				952623879
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0430

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		1900 AVENUE OF THE STARS
		STREET 2:		SUITE 2600
		CITY:			LOS ANGELES
		STATE:			CA
		ZIP:			90067
		BUSINESS PHONE:		3105521834

	MAIL ADDRESS:	
		STREET 1:		1900 AVENUE OF THE STARS
		STREET 2:		SUITE 2600
		CITY:			LOS ANGELES
		STATE:			CA
		ZIP:			90067

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	KORN FERRY INTERNATIONAL
		DATE OF NAME CHANGE:	19980807
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<TYPE>CORRESP
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<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[KORN FERRY LETTERHEAD] </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right">February&nbsp;8, 2021 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Securities and Exchange
Commission </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Division of Corporation Finance </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Office of
Trade&nbsp;&amp; Services </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">100 F Street, N.E. </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Washington,
D.C. 20549 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Attn: Suying Li and Rufus Decker </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>VIA
EDGAR</U></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>Re:</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Korn Ferry </B></P></TD></TR></TABLE>
<P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>Form <FONT STYLE="white-space:nowrap">10-K</FONT> for the Fiscal Year Ended April&nbsp;30, 2020 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>Filed July&nbsp;15, 2020 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>File <FONT STYLE="white-space:nowrap">No.&nbsp;001-14505</FONT> </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Dear Ms.&nbsp;Li and Mr.&nbsp;Decker, </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This
letter responds to your letter dated February&nbsp;2, 2021, regarding Korn Ferry&#146;s (the &#147;Company&#148;) annual report on Form <FONT STYLE="white-space:nowrap">10-K</FONT> for the fiscal year ended April&nbsp;30, 2020 (filed July&nbsp;15,
2020). Your comment from the February&nbsp;2, 2021 letter is set forth below, followed by our related response. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Form
<FONT STYLE="white-space:nowrap">10-K</FONT> for the Fiscal Year Ended April&nbsp;30, 2020 </U></B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Consolidated Financial Statements </U></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Note 11. Segments, Page <FONT STYLE="white-space:nowrap">F-38</FONT> </U></B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>1.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Please tell us your basis for presenting three measures of each segment&#146;s profit (operating income,
EBITDA and adjusted EBITDA) in the ASC 280 segment footnote. Also, explain why EBITDA and adjusted EBITDA are permitted to be disclosed in the ASC 280 segment footnote, when the operating income measure appears to be most consistent with GAAP. Refer
to ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">280-10-50-27</FONT></FONT></FONT> and <FONT STYLE="white-space:nowrap">50-28.</FONT> </B></P></TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">As disclosed in the Company&#146;s Annual Report on Form <FONT STYLE="white-space:nowrap">10-K</FONT> for the year ended
April&nbsp;30, 2020, the Company evaluates segment performance and allocates resources based on the chief operating decision marker&#146;s (&#147;CODM&#148;) review of (1)&nbsp;fee revenue and (2)&nbsp;adjusted EBITDA. Adjusted EBITDA is the only
profitability metric reported to the Company&#146;s CODM for these purposes. As such, adjusted EBITDA is the profitability metric required to be disclosed in the Company&#146;s ASC 280 segment footnote under ASC <FONT STYLE="white-space:nowrap"><FONT
STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">280-10-50-28.</FONT></FONT></FONT> Further, since the Company&#146;s CODM does not consider operating income by segment in evaluating profitability, it would not be appropriate under ASC <FONT
STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">280-10-50-27</FONT></FONT></FONT> for the Company to present operating income by segment in lieu of adjusted EBITDA as the Company&#146;s ASC 280 segment
measure of profitability. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">The disclosure of operating income by segment within Note 11 to the
Company&#146;s Consolidated Financial Statements is however required to comply with the guidance set forth in ASC
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">280-10-50-29(b).</FONT></FONT></FONT> ASC
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">280-10-50-29(b)</FONT></FONT></FONT> requires the Company to provide an explanation of the measurements of segment profit or loss that includes,
&#147;at a minimum&#133; [t]he nature of any differences between the measurements of the reportable segments&#146; profits or losses and the public entity&#146;s consolidated income before income taxes and discontinued operations.&#148; In order for
the Company to meaningfully explain the differences between segment adjusted EBITDA and consolidated income before income taxes and discontinued operations, it is necessary to show how the latter measure is allocated among the segments. However, the
Company does not allocate items such as interest expense and other income or loss by segment, therefore the earliest level at which it can present such measure for its segments is at the operating income level. Accordingly, even though it is not the
measure of profitability used by the CODM, the Company is nonetheless required to present it within Note 11 in order to explain the nature of the differences between our segments&#146; Adjusted EBITDA and the Company&#146;s consolidated income
before income taxes and discontinued operations. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Company presents EBITDA within Note 11 to provide readers with
enhanced clarity regarding the adjustments made in reconciling adjusted EBITDA to operating income. The presentation of EBITDA, which the Company believes certain of its stakeholders use in their analysis of the Company&#146;s profitability and by
banks for credit agreement compliance purposes, provides readers with an interim subtotal to show the significance of the two main buckets of adjustments made by the Company to evaluate profitability, those included within EBITDA (i.e., interest,
taxes, depreciation and amortization) and all other adjustments (i.e., restructuring charges, integration/acquisition costs, certain separation costs and certain <FONT STYLE="white-space:nowrap">non-cash</FONT> charges (goodwill, intangible asset
and other than temporary impairment)) to arrive at Adjusted EBITDA. While the Company is of the view that removing the subtotal for EBITDA would result in less clarity for the readers of its financial statements, if the Staff is of the view that the
measure should be removed, the Company would defer to the Staff&#146;s request and remove EBITDA from its ASC 280 segment footnote in future filings. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We appreciate the Staff&#146;s responsiveness with respect to the Company&#146;s filing and look forward to resolving any concerns the Staff
may have. If you have any questions, please contact me at (310) <FONT STYLE="white-space:nowrap">226-6366</FONT> or Ari Lanin of Gibson, Dunn&nbsp;&amp; Crutcher LLP at (310) <FONT STYLE="white-space:nowrap">552-8581.</FONT> </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">Sincerely, </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">/s/ Robert P. Rozek </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">Robert P. Rozek </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">Executive Vice President, Chief Financial </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">Officer&nbsp;&amp; Chief Corporate Officer </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">cc:</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Don Ferrera, Ernst&nbsp;&amp; Young LLP (via electronic mail) </P></TD></TR></TABLE>
<P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Ari Lanin, Gibson, Dunn&nbsp;&amp; Crutcher LLP (via electronic mail) </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>

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