RECENT ACCOUNTING PRONOUNCEMENTS

12 Months Ended

Dec. 31, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Pronouncements Not Yet Adopted

Effective January 1, 2020, the Company will adopt ASU No. 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments (ASU 2016-13), as amended, using a modified retrospective approach. The standard amends the guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred-loss model with an expected-loss model. This new standard also requires that credit losses related to available-for-sale debt securities be recorded as an allowance through net income rather than by reducing the carrying amount under the current, other-than-temporary impairment model. The Company anticipates no material impact on its Consolidated Financial Statements due to the nature of the Company’s financial instruments.

Accounting Pronouncements Adopted

Effective January 1, 2019, the Company adopted ASC Topic 842. The amended guidance required balance sheet recognition of lease ROU assets and liabilities by lessees for leases classified as operating leases, with an option to not recognize lease ROU assets and lease liabilities for leases with a term of 12 months or less. The amendments also required new disclosures providing additional qualitative and quantitative information about the amounts recorded in the financial statements. Lessor accounting is largely unchanged. The Company adopted ASC Topic 842 using the modified retrospective method for all lease arrangements at the beginning of the period of adoption through a cumulative adjustment to Accumulated Deficit. The Company elected to use the practical expedient allowing the use-of-hindsight and reassessed the lease term for all unexpired leases that commenced before the effective date of ASC Topic 842. For leases that commenced and expired before the effective date of ASC Topic 842, the Company elected not to reassess the expired leases. The Company also elected not to include leases with initial

terms of twelve months or less in the recognized ROU assets and lease liabilities.

As a result of the cumulative impact of adopting ASC Topic 842, the Company recorded lease ROU assets of $55.9 million and lease liabilities of $59.0 million as of January 1, 2019, primarily related to real estate and equipment, based on the present value of future lease payments on the date of adoption. The difference between the ROU assets and lease liabilities was recorded as an adjustment to Accumulated Deficit. See Note 12 to these Consolidated Financial Statements for disclosures required under ASC Topic 842.

Effective January 1, 2019, the Company adopted ASU No. 2017-12 using the modified retrospective method. This ASU provides new guidance about income statement classification and eliminates the requirement to separately measure and report hedge ineffectiveness. The adoption of this ASU did not have a material impact on the Company’s Consolidated Financial Statements. See Note 11 to these Consolidated Financial Statements for additional disclosures required by ASU 2017-12.