XML 71 R16.htm IDEA: XBRL DOCUMENT

Leases

9 Months Ended

Sep. 30, 2019

(8) Leases

The Company has various cancelable and noncancelable leased assets within all segments, which include certain properties, vehicles and equipment of which are all classified as operating leases. Payments for these leases are generally fixed; however, several of our leases are composed of variable lease payments including index-based payments or inflation-based payments based on a Consumer Price Index (“CPI”) or other escalators. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Under Leases (Topic 842), the Company determines an arrangement is a lease when we have the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Other than the leases that we have already identified, we are not aware of any material leases that have not yet commenced. For leases that have a calculated lease term of 12 months or less and do not include an option to purchase the underlying asset which we are reasonably certain to exercise, the Company has made the policy election to not apply the recognition requirements in Leases (Topic 842). For these short-term leases, the Company recognizes the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred.

For the leases identified, ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, the Company used the calculated incremental borrowing rate based on the information available at the implementation date, and going forward at the commencement date, in determining the present value of lease payments. The Company will use the implicit rate when readily determinable. The ROU asset includes the carrying amount of the lease liability, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. The Company’s lease terms may include options to extend or terminate the lease and such options are included in the lease term when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Lease expenses are recognized within COGS, SG&A and design and development (“D&D”) costs in the condensed consolidated statements of operations. The Company has made the policy election to account for lease and non-lease components as a single lease component for all of its leases.

As a result of the Company’s election to apply the modified retrospective transition method at the effective date of the standard, information prior to January 1, 2019 has not been restated and continues to be reported under the accounting standards in effect for the period (ASC Topic 840).

The components of lease expense are as follows:


		Three months ended		Nine months ended
		September 30, 2019		September 30, 2019
Operating lease cost	$	1,345	$	4,241
Short-term lease cost		114		415
Variable lease cost		99		279
Total lease cost	$	1,558	$	4,935

Balance Sheet information related to leases is as follows:


		As of September 30, 2019
Assets:
Operating lease right-of-use assets	$	20,899

Liabilities:
Operating lease current liability, included in other current liabilities		4,188
Operating lease long-term liability		17,059
Total leased liabilities	$	21,247

Maturities of operating lease liabilities are as follows:


		As of September 30, 2019
Year ending December 31,
2019 ⁽¹⁾	$	1,310
2020		4,680
2021		4,068
2022		3,115
2023		3,062
Thereafter		9,881
Total future minimum lease payments	$	26,116
Less: imputed interest		(4,869)
Total lease liabilities	$	21,247

(1) For the remaining three months

Weighted-average remaining lease term and discount rate is as follows:


	As of September 30, 2019
Weighted-average remaining lease term (in years)
Operating leases		6.93
Weighted-average discount rate
Operating leases		5.77	%

Other information:


Nine months ended		September 30, 2019
Operating cash flows:
Cash paid related to operating lease obligations	$	4,265
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	5,327