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Fair value measurements | Jul. 01, 2024
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Fair Value Disclosures [Abstract] |
Fair value measurements |
NOTE 8: FAIR VALUE MEASUREMENTS
Goodwill impairment analyses – Our policy regarding goodwill impairment can be found under the caption "Note 1: Significant Accounting Policies" in the Notes to Consolidated Financial Statements appearing in the 2023 Form 10-K. This policy explains our methodology for assessing the impairment of goodwill. In completing the 2024 annual impairment analysis as of July 31, 2024, we elected to perform quantitative analyses for certain of our reporting units: Merchant Services, Treasury Management and Business Essentials. These quantitative analyses indicated that the estimated fair values of the reporting units exceeded their carrying values. In determining the estimated fair values of our reporting units, we are required to estimate a number of factors, including revenue growth rates; earnings before interest, taxes, depreciation and amortization ("EBITDA") margins; terminal growth rates; discount rates; and the allocation of shared and corporate items. These assumptions require significant judgement. Actual results may differ from our assumptions and may result in future impairment charges. We elected to complete qualitative analyses for our remaining reporting units with goodwill. These qualitative analyses evaluated factors, including, but not limited to, economic, market and industry conditions, cost factors and the overall financial performance of the reporting units. We also considered the most recent quantitative analyses completed in prior periods. In completing these qualitative assessments, we noted no changes in events or circumstances that indicated it was more likely than not that the fair value of any reporting unit was less than its carrying amount. As such, no goodwill impairment charges were recorded as a result of our 2024 annual impairment analysis. As of September 30, 2024, we also completed a quantitative analysis of the goodwill related to our U.S. and Canadian payroll and human resources services business, which we are currently in the process of exiting. This analysis resulted in a pretax goodwill impairment charge of $6,700 during the quarter ended September 30, 2024. Further information can be found in Note 6. Recurring fair value measurements – C ash and cash equivalents included available-for-sale debt securities at December 31, 2023 (Note 3), which consisted of a domestic money market fund. The cost of the fund, which was traded in an active market, approximated its fair value because of the short-term nature of the underlying investments. The fair value of derivative instruments (Note 7) is calculated based on the applicable reference rate curve on the date of measurement. Information regarding the fair values of our financial instruments was as follows:
|  |  |  |  |  | Fair value measurements using
|  |  |  | September 30, 2024 |  | Quoted prices in active markets for identical assets (Level 1) |  | Significant other observable inputs (Level 2) |  | Significant unobservable inputs (Level 3)
(in thousands) |  | Balance sheet location |  | Carrying value |  | Fair value |  |  |
Measured at fair value through comprehensive income: |  |  |  |  |  |  |  |  |  |  |  |
Derivative liabilities (Note 7) |  | Accrued liabilities and other non-current liabilities |  | $ | (4,380) |  |  | $ | (4,380) |  |  | $ | — |  |  | $ | (4,380) |  |  | $ | — |
Amortized cost: |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | Cash and cash equivalents |  | 41,307 |  |  | 41,307 |  |  | 41,307 |  |  | — |  |  | — |
Cash |  | Funds held for customers |  | 41,258 |  |  | 41,258 |  |  | 41,258 |  |  | — |  |  | — |
Cash |  | Other non-current assets |  | 3,030 |  |  | 3,030 |  |  | 3,030 |  |  | — |  |  | — |
Loans and notes receivable from distributors |  | Other current assets and other non-current assets |  | 13,314 |  |  | 14,278 |  |  | — |  |  | — |  |  | 14,278 |
Long-term debt |  | Current portion of long-term debt and long-term debt |  | 1,531,527 |  |  | 1,515,895 |  |  | — |  |  | 1,515,895 |  |  | — |
|  |  |  |  |  | Fair value measurements using
|  |  |  | December 31, 2023 |  | Quoted prices in active markets for identical assets (Level 1) |  | Significant other observable inputs (Level 2) |  | Significant unobservable inputs (Level 3)
(in thousands) |  | Balance sheet location |  | Carrying value |  | Fair value |  |  |
Measured at fair value through comprehensive income: |  |  |  |  |  |  |  |  |  |  |  |
Available-for-sale debt securities |  | Cash and cash equivalents |  | $ | 22,000 |  |  | $ | 22,000 |  |  | $ | 22,000 |  |  | $ | — |  |  | $ | — |
Derivative assets (Note 7) |  | Other non-current assets |  | 1,806 |  |  | 1,806 |  |  | — |  |  | 1,806 |  |  | — |
Derivative liability (Note 7) |  | Other non-current liabilities |  | (2,158) |  |  | (2,158) |  |  | — |  |  | (2,158) |  |  | — |
Amortized cost: |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | Cash and cash equivalents |  | 49,962 |  |  | 49,962 |  |  | 49,962 |  |  | — |  |  | — |
Cash |  | Funds held for customers |  | 383,134 |  |  | 383,134 |  |  | 383,134 |  |  | — |  |  | — |
Cash |  | Other non-current assets |  | 2,937 |  |  | 2,937 |  |  | 2,937 |  |  | — |  |  | — |
Loans and notes receivable from distributors |  | Other current assets and other non-current assets |  | 13,430 |  |  | 13,249 |  |  | — |  |  | — |  |  | 13,249 |
Long-term debt |  | Current portion of long-term debt and long-term debt |  | 1,592,851 |  |  | 1,554,028 |  |  | — |  |  | 1,554,028 |  |  | — |

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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