Delaware | 36-2681268 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number) |
Title of Each Class | Name of Each Exchange On Which Registered | |
Common Stock, $.01 par value | The Nasdaq Stock Market |
Large accelerated filer | ¨ | Accelerated filer | x | ||
Non-Accelerated filer | ¨ (Do not check if a smaller reporting company) | Smaller reporting company | ¨ | ||
Emerging growth company | ¨ |
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• | Analyzing the client’s business needs in order to understand its organizational structure, relationships, and culture; advising the client as to the required set of skills and experiences for the position; and identifying with the client the other characteristics desired of the successful candidate |
• | Selecting, contacting, interviewing and evaluating candidates on the basis of experience and potential cultural fit with the client organization |
• | Presenting confidential written reports on the candidates who potentially fit the position specification |
• | Scheduling a mutually convenient meeting between the client and each candidate |
• | Completing references on the final candidate selected by the client |
• | Assisting the client in structuring compensation packages and supporting the successful candidate’s integration into the client team |
• | Shaping the culture to support new strategies and structures |
• | Aligning executive teams when there are new leaders and/or new roles |
• | Integrating cultures following mergers and acquisitions |
• | Helping minimize cultural barriers to change when implementing major organizational systems or processes |
• | Creating greater organizational agility to meet the challenges of a changing marketplace. |
• | Fortune 1000 companies |
• | Major U.S. and non-U.S. companies |
• | Middle market and emerging growth companies |
• | Governmental, higher education and not-for-profit organizations |
• | Other leading private and public entities |
Year Ended December 31, | |||||||||
2017 | 2016 | 2015 | |||||||
Executive Search | |||||||||
Americas | 55 | % | 53 | % | 55 | % | |||
Europe | 20 | % | 19 | % | 17 | % | |||
Asia Pacific | 14 | % | 15 | % | 17 | % | |||
Leadership Consulting | 7 | % | 7 | % | 4 | % | |||
Culture Shaping | 4 | % | 6 | % | 7 | % |
Percentage of Billings | |||||||||
Global Industry Practices | 2017 | 2016 | 2015 | ||||||
Financial Services | 27 | % | 28 | % | 27 | % | |||
Global Technology & Services | 22 | 21 | 22 | ||||||
Industrial | 18 | 21 | 21 | ||||||
Consumer Markets | 17 | 17 | 16 | ||||||
Healthcare & Life Sciences | 12 | 11 | 10 | ||||||
Education, Non-Profit & Social Enterprise | 4 | 2 | 4 | ||||||
100 | % | 100 | % | 100 | % |
• | diversion of management attention; |
• | failure to successfully further develop the acquired business; |
• | amortization of intangible assets, adversely affecting our reported results of operations; |
• | inability to retain and/or integrate the management, key personnel and other employees of the acquired business; |
• | inability to properly integrate businesses resulting in operating inefficiencies; |
• | inability to establish uniform standards, disclosure controls and procedures, internal control over financial reporting and other systems, procedures and policies in a timely manner; |
• | inability to retain the acquired company’s clients; |
• | exposure to legal claims for activities of the acquired business prior to acquisition; and |
• | inability to generate revenues to offset any new liabilities assumed and expenses associated with an acquired business. |
• | limitations on the removal of directors |
• | limitations on stockholder actions |
• | the ability to issue one or more series of preferred stock by action of our Board of Directors |
Square Footage | ||
Americas | 262,883 | |
Asia Pacific | 108,669 | |
Europe | 110,684 | |
Total | 482,236 |
Year Ended December 31, 2017 | High | Low | ||||||
First Quarter | $ | 26.50 | $ | 20.95 | ||||
Second Quarter | 27.10 | 19.90 | ||||||
Third Quarter | 22.60 | 17.90 | ||||||
Fourth Quarter | 26.82 | 20.55 |
Year Ended December 31, 2016 | High | Low | ||||||
First Quarter | $ | 26.91 | $ | 22.22 | ||||
Second Quarter | 24.69 | 16.36 | ||||||
Third Quarter | 21.15 | 16.73 | ||||||
Fourth Quarter | 24.50 | 17.55 |
Quarter | Record Date | Payment Date | Dividends (in millions) | |||
Q1 2016 | February 5, 2016 | February 19, 2016 | $2.4 | |||
Q2 2016 | May 6, 2016 | May 20, 2016 | $2.4 | |||
Q3 2016 | August 5, 2016 | August 19, 2016 | $2.4 | |||
Q4 2016 | November 4, 2016 | November 18, 2016 | $2.4 | |||
Q1 2017 | February 3, 2017 | February 17, 2017 | $2.4 | |||
Q2 2017 | May 5, 2017 | May 19, 2017 | $2.4 | |||
Q3 2017 | August 4, 2017 | August 18, 2017 | $2.4 | |||
Q4 2017 | November 3, 2017 | November 17, 2017 | $2.4 |
Year Ended December 31, | ||||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | ||||||||||||||||
(in thousands, except per share and other operating data) | ||||||||||||||||||||
Statements of Operations Data: | ||||||||||||||||||||
Revenue: | ||||||||||||||||||||
Revenue before reimbursements (net revenue) | $ | 621,400 | $ | 582,390 | $ | 531,139 | $ | 494,292 | $ | 461,995 | ||||||||||
Reimbursements | 18,656 | 18,516 | 17,172 | 18,947 | 18,998 | |||||||||||||||
Total revenue | 640,056 | 600,906 | 548,311 | 513,239 | 480,993 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Salaries and employee benefits | 434,219 | 400,070 | 369,385 | 337,448 | 319,499 | |||||||||||||||
General and administrative expenses | 147,316 | 147,087 | 127,692 | 130,191 | 126,931 | |||||||||||||||
Impairment charges (1) | 50,722 | — | — | — | — | |||||||||||||||
Restructuring charges (2) | 15,666 | — | — | — | — | |||||||||||||||
Reimbursed expenses | 18,656 | 18,516 | 17,172 | 18,947 | 18,998 | |||||||||||||||
Total operating expenses | 666,579 | 565,673 | 514,249 | 486,586 | 465,428 | |||||||||||||||
Operating income | (26,523 | ) | 35,233 | 34,062 | 26,653 | 15,565 | ||||||||||||||
Non-operating (expense) income: | ||||||||||||||||||||
Interest, net | 385 | 244 | (122 | ) | (358 | ) | (175 | ) | ||||||||||||
Other, net | (3,280 | ) | 2,289 | (2,386 | ) | (2,108 | ) | (2,002 | ) | |||||||||||
Net non-operating (expense) income | (2,895 | ) | 2,533 | (2,508 | ) | (2,466 | ) | (2,177 | ) | |||||||||||
Income (loss) before income taxes | (29,418 | ) | 37,766 | 31,554 | 24,187 | 13,388 | ||||||||||||||
Provision for income taxes | 19,217 | 22,353 | 14,422 | 17,390 | 7,041 | |||||||||||||||
Net income (loss) | $ | (48,635 | ) | $ | 15,413 | $ | 17,132 | $ | 6,797 | $ | 6,347 | |||||||||
Basic weighted average common shares outstanding | 18,735 | 18,540 | 18,334 | 18,210 | 18,077 | |||||||||||||||
Diluted weighted average common shares outstanding | 18,735 | 18,939 | 18,715 | 18,432 | 18,232 | |||||||||||||||
Basic earnings (loss) per common share | $ | (2.60 | ) | $ | 0.83 | $ | 0.93 | $ | 0.37 | $ | 0.35 | |||||||||
Diluted earnings (loss) per common share | $ | (2.60 | ) | $ | 0.81 | $ | 0.92 | $ | 0.37 | $ | 0.35 | |||||||||
Cash dividends paid per share | $ | 0.52 | $ | 0.52 | $ | 0.52 | $ | 0.52 | $ | 0.39 | ||||||||||
Balance Sheet Data (at end of period): | ||||||||||||||||||||
Working capital (3) | $ | 77,998 | $ | 77,838 | $ | 79,533 | $ | 112,387 | $ | 107,177 | ||||||||||
Total assets (3) | 587,204 | 581,502 | 572,718 | 568,621 | 552,937 | |||||||||||||||
Long-term debt, less current maturities | — | — | — | 23,500 | 29,500 | |||||||||||||||
Stockholders’ equity | 212,705 | 258,590 | 254,802 | 244,664 | 247,873 | |||||||||||||||
Other Operating Data: | ||||||||||||||||||||
Average number of consultants during the period | 389 | 347 | 326 | 313 | 341 |
(1) | Includes impairment charges of $39.2 million related to Culture Shaping and $11.6 million related to Leadership Consulting in 2017. |
(2) | Includes restructuring charges of $15.7 million in 2017. These charges consist of $13.1 million of employee-related costs associated with severance arrangements, $2.3 million in professional fees and other expenses and $0.3 million in real estate related expenses. |
(3) | As adjusted for the adoption of ASU 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes. |
Year Ended December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Revenue | ||||||||||||
Revenue before reimbursements (net revenue) | $ | 621,400 | $ | 582,390 | $ | 531,139 | ||||||
Reimbursements | 18,656 | 18,516 | 17,172 | |||||||||
Total revenue | 640,056 | 600,906 | 548,311 | |||||||||
Operating Expenses | ||||||||||||
Salaries and employee benefits | 434,219 | 400,070 | 369,385 | |||||||||
General and administrative | 147,316 | 147,087 | 127,692 | |||||||||
Impairment charges | 50,722 | — | — | |||||||||
Restructuring charges | 15,666 | — | — | |||||||||
Reimbursed expenses | 18,656 | 18,516 | 17,172 | |||||||||
Total operating expenses | 666,579 | 565,673 | 514,249 | |||||||||
Operating income (loss) | (26,523 | ) | 35,233 | 34,062 | ||||||||
Non-operating income (expense) | ||||||||||||
Interest, net | 385 | 244 | (122 | ) | ||||||||
Other, net | (3,280 | ) | 2,289 | (2,386 | ) | |||||||
Net non-operating income (expense) | (2,895 | ) | 2,533 | (2,508 | ) | |||||||
Income (loss) before taxes | (29,418 | ) | 37,766 | 31,554 | ||||||||
Provision for income taxes | 19,217 | 22,353 | 14,422 | |||||||||
Net income (loss) | $ | (48,635 | ) | $ | 15,413 | $ | 17,132 | |||||
Basic weighted average common shares outstanding | 18,735 | 18,540 | 18,334 | |||||||||
Diluted weighted average common shares outstanding | 18,735 | 19,038 | 18,715 | |||||||||
Basic net income (loss) per common share | $ | (2.60 | ) | $ | 0.83 | $ | 0.93 | |||||
Diluted net income (loss) per common share | $ | (2.60 | ) | $ | 0.81 | $ | 0.92 | |||||
Cash dividends paid per share | $ | 0.52 | $ | 0.52 | $ | 0.52 |
Year Ended December 31, | |||||||||
2017 | 2016 | 2015 | |||||||
Revenue: | |||||||||
Revenue before reimbursements (net revenue) | 100.0 | % | 100.0 | % | 100.0 | % | |||
Reimbursements | 3.0 | 3.2 | 3.2 | ||||||
Total revenue | 103.0 | 103.2 | 103.2 | ||||||
Operating expenses: | |||||||||
Salaries and employee benefits | 69.9 | 68.7 | 69.5 | ||||||
General and administrative expenses | 23.7 | 25.3 | 24.0 | ||||||
Impairment Charges | 8.2 | — | — | ||||||
Restructuring charges | 2.5 | — | — | ||||||
Reimbursed expenses | 3.0 | 3.2 | 3.2 | ||||||
Total operating expenses | 107.3 | 97.1 | 96.8 | ||||||
Operating income (loss) | (4.3 | ) | 6.0 | 6.4 | |||||
Non-operating income (expense) | |||||||||
Interest, net | 0.1 | — | — | ||||||
Other, net | (0.5 | ) | 0.4 | (0.4 | ) | ||||
Net non-operating income (expense) | (0.5 | ) | 0.4 | (0.5 | ) | ||||
Income (loss) before income taxes | (4.7 | ) | 6.5 | 5.9 | |||||
Provision for income taxes | 3.1 | 3.8 | 2.7 | ||||||
Net income (loss) | (7.8 | )% | 2.6 | % | 3.2 | % |
Year Ended December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Revenue: | ||||||||||||
Executive Search | ||||||||||||
Americas | $ | 339,793 | $ | 313,292 | $ | 294,606 | ||||||
Europe | 125,346 | 108,754 | 92,135 | |||||||||
Asia Pacific | 86,905 | 85,319 | 89,026 | |||||||||
Total Executive Search | 552,044 | 507,365 | 475,767 | |||||||||
Leadership Consulting | 41,227 | 38,806 | 19,045 | |||||||||
Culture Shaping | 28,129 | 36,219 | 36,327 | |||||||||
Revenue before reimbursements (net revenue) | 621,400 | 582,390 | 531,139 | |||||||||
Reimbursements | 18,656 | 18,516 | 17,172 | |||||||||
Total revenue | $ | 640,056 | $ | 600,906 | $ | 548,311 | ||||||
Operating income (loss): | ||||||||||||
Executive Search | ||||||||||||
Americas (1) | $ | 81,531 | $ | 73,857 | $ | 68,043 | ||||||
Europe (2) | 2,038 | 6,851 | 3,644 | |||||||||
Asia Pacific (3) | 2,128 | 4,799 | 5,909 | |||||||||
Total Executive Search | 85,697 | 85,507 | 77,596 | |||||||||
Leadership Consulting (4) | (15,614 | ) | (1,495 | ) | (1,847 | ) | ||||||
Culture Shaping (5) | (41,818 | ) | (1,558 | ) | 4,913 | |||||||
Total Segments | 28,265 | 82,454 | 80,662 | |||||||||
Global Operations Support (6) | (54,788 | ) | (47,221 | ) | (46,600 | ) | ||||||
Total operating income (loss) | $ | (26,523 | ) | $ | 35,233 | $ | 34,062 |
(1) | Operating income for the Americas includes $0.8 million of restructuring charges in 2017. |
(2) | Operating income for Europe includes $4.0 million of restructuring charges in 2017. |
(3) | Operating income for Asia Pacific includes $2.0 million of restructuring charges in 2017. |
(4) | Operating loss for Leadership Consulting includes $11.6 million of impairment charges and $0.9 million of restructuring charges in 2017. |
(5) | Operating loss for Culture Shaping includes $39.2 million of impairment charges and $2.5 million of restructuring charges in 2017. |
(6) | Operating loss for Global Operations Support includes $5.5 million of restructuring charges in 2017. |
Payments due for the years ended December 31, | ||||||||||||||||||||||||||||
2018 | 2019 | 2020 | 2021 | 2022 | Thereafter | Total | ||||||||||||||||||||||
Contractual obligations: | ||||||||||||||||||||||||||||
Operating lease obligations | $ | 36.4 | $ | 31.1 | $ | 22.9 | $ | 18.9 | $ | 16.2 | $ | 22.6 | $ | 148.1 | ||||||||||||||
Asset retirement obligations (1) | 0.4 | 0.3 | 0.2 | 0.6 | 0.1 | 1.3 | 2.9 | |||||||||||||||||||||
Total | $ | 36.8 | $ | 31.4 | $ | 23.1 | $ | 19.5 | $ | 16.3 | $ | 23.9 | $ | 151.0 |
Quarter Ended | ||||||||||||||||||||||||||||||||
2017 | 2016 | |||||||||||||||||||||||||||||||
Mar. 31 | Jun. 30 | Sept. 30 | Dec. 31 | Mar. 31 | Jun. 30 | Sept. 30 | Dec. 31 | |||||||||||||||||||||||||
Revenue before reimbursements (net revenue) | $ | 140,006 | $ | 152,214 | $ | 159,800 | $ | 169,380 | $ | 130,189 | $ | 148,861 | $ | 143,519 | $ | 159,821 | ||||||||||||||||
Operating income (loss) | 6,638 | (28,411 | ) | 14,022 | (18,772 | ) | 3,868 | 11,694 | 12,006 | 7,665 | ||||||||||||||||||||||
Income (loss) before income taxes | 4,094 | (28,686 | ) | 14,263 | (19,089 | ) | 3,989 | 11,781 | 12,388 | 9,608 | ||||||||||||||||||||||
Provision for income taxes | 3,444 | (10,438 | ) | 6,092 | 20,119 | 2,664 | 5,126 | 5,448 | 9,115 | |||||||||||||||||||||||
Net income (loss) | $ | 650 | $ | (18,248 | ) | $ | 8,171 | $ | (39,208 | ) | $ | 1,325 | $ | 6,655 | $ | 6,940 | $ | 493 | ||||||||||||||
Basic earnings (loss) per common share | $ | 0.03 | $ | (0.97 | ) | $ | 0.44 | $ | (2.09 | ) | $ | 0.07 | $ | 0.36 | $ | 0.37 | $ | 0.03 | ||||||||||||||
Diluted earnings (loss) per common share | $ | 0.03 | $ | (0.97 | ) | $ | 0.43 | $ | (2.09 | ) | $ | 0.07 | $ | 0.35 | $ | 0.37 | $ | 0.01 | ||||||||||||||
Cash dividends paid per share | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.13 |
PAGE | |
December 31, 2017 | December 31, 2016 | |||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 207,534 | $ | 165,011 | ||||
Accounts receivable, net | 98,700 | 93,191 | ||||||
Prepaid expenses | 22,003 | 21,602 | ||||||
Other current assets | 11,620 | 13,779 | ||||||
Income taxes recoverable | 3,933 | 4,847 | ||||||
Total current assets | 343,790 | 298,430 | ||||||
Non-current assets: | ||||||||
Property and equipment, net | 39,514 | 35,099 | ||||||
Assets designated for retirement and pension plans | 17,130 | 15,698 | ||||||
Investments | 21,319 | 17,346 | ||||||
Other non-current assets | 8,999 | 9,322 | ||||||
Goodwill | 118,892 | 151,844 | ||||||
Other intangible assets, net | 2,158 | 20,690 | ||||||
Deferred income taxes | 35,402 | 33,073 | ||||||
Total non-current assets | 243,414 | 283,072 | ||||||
Total assets | $ | 587,204 | $ | 581,502 | ||||
Current liabilities: | ||||||||
Accounts payable | $ | 9,824 | $ | 7,952 | ||||
Accrued salaries and employee benefits | 177,426 | 155,523 | ||||||
Deferred revenue, net | 31,272 | 28,367 | ||||||
Other current liabilities | 40,346 | 24,133 | ||||||
Income taxes payable | 6,924 | 4,617 | ||||||
Total current liabilities | 265,792 | 220,592 | ||||||
Non-current liabilities: | ||||||||
Accrued salaries and employee benefits | 40,308 | 34,993 | ||||||
Retirement and pension plans | 44,802 | 39,039 | ||||||
Other non-current liabilities | 23,597 | 28,288 | ||||||
Total non-current liabilities | 108,707 | 102,320 | ||||||
Total liabilities | 374,499 | 322,912 | ||||||
Commitments and contingencies (Note 19) | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.01 par value, 10,000,000 shares authorized, no shares issued at December 31, 2017 and December 31, 2016 | — | — | ||||||
Common stock, $0.01 par value, 100,000,000 shares authorized, 19,585,777 shares issued, 18,781,433 and 18,578,176 shares outstanding at December 31, 2017 and December 31, 2016, respectively | 196 | 196 | ||||||
Treasury stock at cost, 804,344 and 1,007,601 shares at December 31, 2017 and December 31, 2016, respectively | (26,096 | ) | (32,915 | ) | ||||
Additional paid in capital | 226,006 | 229,957 | ||||||
Retained earnings (deficit) | (716 | ) | 58,030 | |||||
Accumulated other comprehensive income | 13,315 | 3,322 | ||||||
Total stockholders’ equity | 212,705 | 258,590 | ||||||
Total liabilities and stockholders’ equity | $ | 587,204 | $ | 581,502 |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Revenue: | ||||||||||||
Revenue before reimbursements (net revenue) | $ | 621,400 | $ | 582,390 | $ | 531,139 | ||||||
Reimbursements | 18,656 | 18,516 | 17,172 | |||||||||
Total revenue | 640,056 | 600,906 | 548,311 | |||||||||
Operating expenses: | ||||||||||||
Salaries and employee benefits | 434,219 | 400,070 | 369,385 | |||||||||
General and administrative expenses | 147,316 | 147,087 | 127,692 | |||||||||
Impairment charges | 50,722 | — | — | |||||||||
Restructuring charges | 15,666 | — | — | |||||||||
Reimbursed expenses | 18,656 | 18,516 | 17,172 | |||||||||
Total operating expenses | 666,579 | 565,673 | 514,249 | |||||||||
Operating income (loss) | (26,523 | ) | 35,233 | 34,062 | ||||||||
Non-operating income (expense): | ||||||||||||
Interest, net | 385 | 244 | (122 | ) | ||||||||
Other, net | (3,280 | ) | 2,289 | (2,386 | ) | |||||||
Net non-operating income (expense) | (2,895 | ) | 2,533 | (2,508 | ) | |||||||
Income (loss) before income taxes | (29,418 | ) | 37,766 | 31,554 | ||||||||
Provision for income taxes | 19,217 | 22,353 | 14,422 | |||||||||
Net income (loss) | (48,635 | ) | 15,413 | 17,132 | ||||||||
Other comprehensive income (loss), net of tax: | ||||||||||||
Foreign currency translation adjustment | 6,853 | (6,271 | ) | (1,811 | ) | |||||||
Net unrealized gain (loss) on available-for-sale investments | 2,660 | 1,035 | (789 | ) | ||||||||
Pension gain (loss) adjustment | 480 | (701 | ) | 714 | ||||||||
Unrealized loss on cash flow hedge | — | — | (78 | ) | ||||||||
Other comprehensive income (loss), net of tax | 9,993 | (5,937 | ) | (1,964 | ) | |||||||
Comprehensive income (loss) | $ | (38,642 | ) | $ | 9,476 | $ | 15,168 | |||||
Basic weighted average common shares outstanding | 18,735 | 18,540 | 18,334 | |||||||||
Dilutive common shares | — | 498 | 381 | |||||||||
Diluted weighted average common shares outstanding | 18,735 | 19,038 | 18,715 | |||||||||
Basic net income (loss) per common share | $ | (2.60 | ) | $ | 0.83 | $ | 0.93 | |||||
Diluted net income (loss) per common share | $ | (2.60 | ) | $ | 0.81 | $ | 0.92 | |||||
Cash dividends paid per share | $ | 0.52 | $ | 0.52 | $ | 0.52 |
Common Stock | Treasury Stock | Additional Paid in Capital | Retained Earnings (Deficit) | Accumulated Other Comprehensive Income | Total | |||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||
Balance at December 31, 2014 | 19,586 | $ | 196 | 1,346 | $ | (44,261 | ) | $ | 232,075 | $ | 45,431 | $ | 11,223 | $ | 244,664 | |||||||||||||||
Net income | — | — | — | — | — | 17,132 | — | 17,132 | ||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | — | (1,964 | ) | (1,964 | ) | ||||||||||||||||||||
Treasury and common stock transactions: | ||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 5,066 | — | — | 5,066 | ||||||||||||||||||||||
Vesting of equity, net of tax withholdings | — | — | (123 | ) | 4,094 | (4,972 | ) | — | — | (878 | ) | |||||||||||||||||||
Re-issuance of treasury stock | — | — | (17 | ) | 584 | (135 | ) | — | — | 449 | ||||||||||||||||||||
Cash dividends declared ($0.52 per share) | — | — | — | — | — | (9,550 | ) | — | (9,550 | ) | ||||||||||||||||||||
Dividend equivalents on restricted stock units | — | — | — | — | — | (441 | ) | — | (441 | ) | ||||||||||||||||||||
Tax surplus related to stock-based compensation | — | — | — | — | 324 | — | — | 324 | ||||||||||||||||||||||
Balance at December 31, 2015 | 19,586 | 196 | 1,206 | (39,583 | ) | 232,358 | 52,572 | 9,259 | 254,802 | |||||||||||||||||||||
Net income | — | — | — | — | — | 15,413 | — | 15,413 | ||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | — | (5,937 | ) | (5,937 | ) | ||||||||||||||||||||
Treasury and common stock transactions: | ||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 6,393 | — | — | 6,393 | ||||||||||||||||||||||
Vesting of equity, net of tax withholdings | — | — | (167 | ) | 5,636 | (8,324 | ) | — | — | (2,688 | ) | |||||||||||||||||||
Re-issuance of treasury stock | — | — | (31 | ) | 1,032 | (470 | ) | — | — | 562 | ||||||||||||||||||||
Cash dividends declared ($0.52 per share) | — | — | — | — | — | (9,668 | ) | — | (9,668 | ) | ||||||||||||||||||||
Dividend equivalents on restricted stock units | — | — | — | — | — | (287 | ) | — | (287 | ) | ||||||||||||||||||||
Balance at December 31, 2016 | 19,586 | 196 | 1,008 | (32,915 | ) | 229,957 | 58,030 | 3,322 | 258,590 | |||||||||||||||||||||
Net loss | — | — | — | — | — | (48,635 | ) | — | (48,635 | ) | ||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | 9,993 | 9,993 | ||||||||||||||||||||||
Treasury and common stock transactions: | ||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 4,935 | — | — | 4,935 | ||||||||||||||||||||||
Vesting of equity, net of tax withholdings | — | — | (188 | ) | 6,311 | (8,716 | ) | — | — | (2,405 | ) | |||||||||||||||||||
Re-issuance of treasury stock | — | — | (15 | ) | 508 | (170 | ) | — | — | 338 | ||||||||||||||||||||
Cash dividends declared ($0.52 per share) | — | — | — | — | — | (9,762 | ) | — | (9,762 | ) | ||||||||||||||||||||
Dividend equivalents on restricted stock units | — | — | — | — | — | (349 | ) | — | (349 | ) | ||||||||||||||||||||
Balance at December 31, 2017 | 19,586 | $ | 196 | 805 | $ | (26,096 | ) | $ | 226,006 | $ | (716 | ) | $ | 13,315 | $ | 212,705 |
Year Ended December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Cash flows - operating activities: | ||||||||||||
Net income (loss) | $ | (48,635 | ) | $ | 15,413 | $ | 17,132 | |||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||
Depreciation and amortization | 14,774 | 16,433 | 13,696 | |||||||||
Deferred income taxes | (1,690 | ) | 2,394 | (1,166 | ) | |||||||
Stock-based compensation expense | 4,935 | 6,393 | 5,066 | |||||||||
Accretion expense related to earnout payments | 1,038 | 635 | 1,294 | |||||||||
Impairment charges | 50,722 | — | — | |||||||||
Changes in assets and liabilities, net of effects of acquisitions: | ||||||||||||
Accounts receivables | (1,882 | ) | (14,425 | ) | (8,714 | ) | ||||||
Accounts payable | 1,474 | 941 | 810 | |||||||||
Accrued expenses | 18,330 | (909 | ) | 37,207 | ||||||||
Restructuring accrual | 13,025 | — | — | |||||||||
Deferred revenue | 2,010 | (1,672 | ) | (236 | ) | |||||||
Income taxes (payable) recoverable, net | 3,381 | 1,184 | (3,257 | ) | ||||||||
Retirement and pension plan assets and liabilities | 3,065 | 4,215 | (1,142 | ) | ||||||||
Prepaid expenses | 797 | (2,330 | ) | (4,388 | ) | |||||||
Other assets and liabilities, net | 5,626 | (3,449 | ) | 1,281 | ||||||||
Net cash provided by operating activities | 66,970 | 24,823 | 57,583 | |||||||||
Cash flows - investing activities: | ||||||||||||
Restricted cash | (3 | ) | 7,228 | — | ||||||||
Acquisition of business, net of cash acquired | (364 | ) | (27,722 | ) | (10,312 | ) | ||||||
Capital expenditures | (14,022 | ) | (5,351 | ) | (16,427 | ) | ||||||
Purchases of available for sale investments | (2,269 | ) | (2,475 | ) | (1,526 | ) | ||||||
Proceeds from sale of available for sale investments | 1,404 | 535 | 758 | |||||||||
Net cash used in investing activities | (15,254 | ) | (27,785 | ) | (27,507 | ) | ||||||
Cash flows - financing activities: | ||||||||||||
Proceeds from line of credit | 40,000 | — | — | |||||||||
Payments on line of credit | (40,000 | ) | — | (29,500 | ) | |||||||
Debt issuance costs | — | — | (473 | ) | ||||||||
Cash dividends paid | (10,111 | ) | (9,955 | ) | (9,991 | ) | ||||||
Payment of employee tax withholdings on equity transactions | (2,392 | ) | (2,676 | ) | (878 | ) | ||||||
Acquisition earnout payments | (4,557 | ) | (7,461 | ) | (5,496 | ) | ||||||
Net cash used in financing activities | (17,060 | ) | (20,092 | ) | (46,338 | ) | ||||||
Effect of exchange rates fluctuations on cash and cash equivalents | 7,867 | (2,387 | ) | (4,638 | ) | |||||||
Net increase (decrease) in cash and cash equivalents | 42,523 | (25,441 | ) | (20,900 | ) | |||||||
Cash and cash equivalents at beginning of period | 165,011 | 190,452 | 211,352 | |||||||||
Cash and cash equivalents at end of period | $ | 207,534 | $ | 165,011 | $ | 190,452 | ||||||
Supplemental Schedule of Non-cash Financing Activities: | ||||||||||||
Term loan facility retirement (Note 10) | $ | — | $ | — | $ | (26,500 | ) | |||||
Subsequent drawing on line of credit (Note 10) | $ | — | $ | — | $ | 26,500 | ||||||
Supplemental disclosures of cash flow information | ||||||||||||
Cash paid for | ||||||||||||
Income taxes | $ | 14,814 | $ | 16,817 | $ | 16,936 | ||||||
Interest | $ | 193 | $ | 41 | $ | 442 |
1. | Basis of Presentation |
2. | Summary of Significant Accounting Policies |
Office furniture, fixtures and equipment | 5–10 years | |
Computer equipment and software | 3–7 years |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Net income (loss) | $ | (48,635 | ) | $ | 15,413 | $ | 17,132 | ||||
Weighted average shares outstanding: | |||||||||||
Basic | 18,735 | 18,540 | 18,334 | ||||||||
Effect of dilutive securities: | |||||||||||
Restricted stock units | — | 347 | 234 | ||||||||
Performance stock units | — | 151 | 147 | ||||||||
Diluted | 18,735 | 19,038 | 18,715 | ||||||||
Basic earnings (loss) per share | $ | (2.60 | ) | $ | 0.83 | $ | 0.93 | ||||
Diluted earnings (loss) per share | $ | (2.60 | ) | $ | 0.81 | $ | 0.92 |
3. | Allowance for Doubtful Accounts |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Balance at January 1, | $ | 2,575 | $ | 5,376 | $ | 3,942 | ||||||
Provision charged to income | 963 | 1,407 | 2,772 | |||||||||
Write-offs | (1,134 | ) | (4,106 | ) | (1,140 | ) | ||||||
Foreign currency translation | 130 | (102 | ) | (198 | ) | |||||||
Balance at December 31, | $ | 2,534 | $ | 2,575 | $ | 5,376 |
4. | Property and Equipment, net |
December 31, | ||||||||
2017 | 2016 | |||||||
Leasehold improvements | $ | 48,216 | $ | 42,891 | ||||
Office furniture, fixtures and equipment | 17,732 | 16,677 | ||||||
Computer equipment and software | 28,300 | 30,186 | ||||||
Property and equipment, gross | 94,248 | 89,754 | ||||||
Accumulated depreciation | (54,734 | ) | (54,655 | ) | ||||
Property and equipment, net | $ | 39,514 | $ | 35,099 |
5. | Investments |
6. | Fair Value Measurements |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
At December 31, 2017 | ||||||||||||||||
U.S. non-qualified deferred compensation plan | $ | 21,319 | $ | — | $ | — | $ | 21,319 | ||||||||
Assets designated for retirement and pension plans | — | 18,590 | — | 18,590 | ||||||||||||
Pension benefit obligation | — | (23,886 | ) | — | (23,886 | ) | ||||||||||
Acquisition earnout accruals | — | — | (7,213 | ) | (7,213 | ) | ||||||||||
$ | 21,319 | $ | (5,296 | ) | $ | (7,213 | ) | $ | 8,810 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
At December 31, 2016 | ||||||||||||||||
U.S. non-qualified deferred compensation plan | $ | 17,346 | $ | — | $ | — | $ | 17,346 | ||||||||
Assets designated for retirement and pension plans | — | 16,979 | — | 16,979 | ||||||||||||
Pension benefit obligation | — | (22,128 | ) | — | (22,128 | ) | ||||||||||
Acquisition earnout accruals | — | — | (10,991 | ) | (10,991 | ) | ||||||||||
$ | 17,346 | $ | (5,149 | ) | $ | (10,991 | ) | $ | 1,206 |
Acquisition Earnout Accruals | ||||
Balance at December 31, 2016 | $ | (10,991 | ) | |
Earnout accretion | (1,038 | ) | ||
Earnout payments | 4,557 | |||
Philosophy IB earnout adjustment (Note 7) | 705 | |||
Foreign currency translation | (446 | ) | ||
Balance at December 31, 2017 | $ | (7,213 | ) |
7. | Acquisitions |
8. | Goodwill and Other Intangible Assets |
December 31, 2017 | December 31, 2016 | ||||||
Executive Search | |||||||
Americas | $ | 88,690 | $ | 88,101 | |||
Europe | 44,407 | 42,599 | |||||
Asia Pacific | 9,302 | 8,893 | |||||
Total Executive Search | 142,399 | 139,593 | |||||
Leadership Consulting | 6,940 | 6,534 | |||||
Culture Shaping | 29,317 | 29,224 | |||||
Goodwill, gross | 178,656 | 175,351 | |||||
Accumulated impairment | (59,764 | ) | (23,507 | ) | |||
Goodwill, net | $ | 118,892 | $ | 151,844 |
Executive Search | ||||||||||||||||||||||||
Americas | Europe | Asia Pacific | Leadership Consulting | Culture Shaping | Total | |||||||||||||||||||
Gross balance at December 31, 2014 | $ | 82,270 | $ | 23,507 | $ | 10,255 | $ | — | $ | 29,651 | $ | 145,683 | ||||||||||||
Accumulated goodwill impairment | — | (23,507 | ) | — | — | — | (23,507 | ) | ||||||||||||||||
Net balance at December 31, 2014 | 82,270 | — | 10,255 | — | 29,651 | 122,176 | ||||||||||||||||||
Co Company acquisition | — | 10,745 | — | — | — | 10,745 | ||||||||||||||||||
Exchange rate fluctuations | (644 | ) | — | (1,044 | ) | — | (111 | ) | (1,799 | ) | ||||||||||||||
Net balance at December 31, 2015 | 81,626 | 10,745 | 9,211 | — | 29,540 | 131,122 | ||||||||||||||||||
DSI acquisition | 5,673 | — | — | — | — | 5,673 | ||||||||||||||||||
Philosophy IB acquisition | 2,357 | — | — | — | — | 2,357 | ||||||||||||||||||
JCA acquisition | — | 15,769 | — | — | — | 15,769 | ||||||||||||||||||
Segment reallocation (1) | (1,670 | ) | (4,517 | ) | (347 | ) | 6,534 | — | — | |||||||||||||||
Exchange rate fluctuations | 115 | (2,905 | ) | 29 | — | (316 | ) | (3,077 | ) | |||||||||||||||
Net balance at December 31, 2016 | 88,101 | 19,092 | 8,893 | 6,534 | 29,224 | 151,844 | ||||||||||||||||||
Philosophy IB acquisition | 357 | — | — | 7 | — | 364 | ||||||||||||||||||
Exchange rate fluctuations | 232 | 1,808 | 409 | 399 | 93 | 2,941 | ||||||||||||||||||
Impairment | — | — | — | (6,940 | ) | (29,317 | ) | (36,257 | ) | |||||||||||||||
Net balance at December 31, 2017 | $ | 88,690 | $ | 20,900 | $ | 9,302 | $ | — | $ | — | $ | 118,892 |
(1) | Due to the Company's change in segment reporting during the year ended December 31, 2016, goodwill amounts included in the Company's Americas, Europe and Asia Pacific segments in the prior year have been reallocated to the Leadership Consulting segment utilizing the relative fair value method. |
December 31, 2017 | December 31, 2016 | |||||||
Executive Search | ||||||||
Americas | $ | 252 | $ | 501 | ||||
Europe | 1,799 | 2,937 | ||||||
Asia Pacific | 107 | 127 | ||||||
Total Executive Search | 2,158 | 3,565 | ||||||
Leadership Consulting | — | 6,223 | ||||||
Culture Shaping | — | 10,902 | ||||||
Total Other Intangible Assets, Net | $ | 2,158 | $ | 20,690 |
December 31, 2017 | December 31, 2016 | |||||||||||||||||||||||||
Weighted Average Life (in years) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||
Client relationships | 7.9 | $ | 13,703 | $ | (11,612 | ) | $ | 2,091 | $ | 33,299 | $ | (21,653 | ) | $ | 11,646 | |||||||||||
Trade name | 0.0 | 459 | (459 | ) | — | 9,436 | (4,465 | ) | 4,971 | |||||||||||||||||
Software | 0.0 | — | — | — | 7,200 | (4,114 | ) | 3,086 | ||||||||||||||||||
Non-compete | 2.0 | 230 | (163 | ) | 67 | 974 | (423 | ) | 551 | |||||||||||||||||
Technology | 0.0 | — | — | — | 604 | (168 | ) | 436 | ||||||||||||||||||
Total intangible assets | 7.7 | $ | 14,392 | $ | (12,234 | ) | $ | 2,158 | $ | 51,513 | $ | (30,823 | ) | $ | 20,690 |
2018 | $ | 968 | |
2019 | 507 | ||
2020 | 294 | ||
2021 | 194 | ||
2022 | 129 | ||
Thereafter | 66 | ||
Total | $ | 2,158 |
9. | Other Current and Non-Current Liabilities |
December 31, 2017 | December 31, 2016 | |||||||
Restructuring charges | $ | 13,023 | $ | — | ||||
Other | 27,323 | 24,133 | ||||||
Total other current liabilities | $ | 40,346 | $ | 24,133 |
December 31, 2017 | December 31, 2016 | |||||||
Premise related costs | $ | 18,360 | $ | 18,188 | ||||
Accrued earnout payments | 3,076 | 8,518 | ||||||
Restructuring charges | 10 | — | ||||||
Other | 2,151 | 1,582 | ||||||
Total other non-current liabilities | $ | 23,597 | $ | 28,288 |
10. | Line of Credit |
11. | Employee Benefit Plans |
12. | Pension Plan and Life Insurance Contract |
2017 | 2016 | |||||||
Benefit obligation at January 1, | $ | 22,128 | $ | 22,388 | ||||
Interest cost | 362 | 453 | ||||||
Actuarial (gain) loss | (371 | ) | 1,178 | |||||
Benefits paid | (1,453 | ) | (1,198 | ) | ||||
Cumulative translation adjustment | 3,220 | (693 | ) | |||||
Benefit obligation at December 31, | $ | 23,886 | $ | 22,128 |
December 31, | ||||||||
2017 | 2016 | |||||||
Current liabilities | $ | 1,461 | $ | 1,281 | ||||
Noncurrent liabilities | 22,425 | 20,847 | ||||||
Total | $ | 23,886 | $ | 22,128 |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Net period benefit cost: | ||||||||||||
Interest cost | $ | 362 | $ | 453 | $ | 436 | ||||||
Amortization of net loss | 111 | 17 | 72 | |||||||||
Net periodic benefit cost | $ | 473 | $ | 470 | $ | 508 | ||||||
Weighted average assumptions | ||||||||||||
Discount rate (1) | 1.49 | % | 2.15 | % | 1.82 | % | ||||||
Rate of compensation increase | — | % | — | % | 1.75 | % |
December 31, | |||||||||
2017 | 2016 | 2015 | |||||||
Discount rate (1) | 1.64 | % | 1.53 | % | 2.15 | % | |||
Rate of compensation increase | — | % | — | % | — | % | |||
Measurement Date | 12/31/2017 | 12/31/2016 | 12/31/2015 |
(1) | The discount rates are based on long-term bond indices adjusted to reflect the longer duration of the benefit obligation. |
2018 | $ | 1,461 | |
2019 | 1,451 | ||
2020 | 1,437 | ||
2021 | 1,421 | ||
2022 | 1,401 | ||
2023 through 2027 | 6,573 |
13. | Stock-Based Compensation |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Salaries and employee benefits | $ | 4,597 | $ | 5,830 | $ | 4,616 | ||||||
General and administrative expenses | 338 | 563 | 450 | |||||||||
Income tax benefit related to stock-based compensation included in net income | 1,948 | 2,523 | 1,856 |
Number of Restricted Stock Units | Weighted- Average Grant-date Fair Value | ||||||
Outstanding on December 31, 2014 | 462,717 | $ | 18.07 | ||||
Granted | 184,541 | 23.94 | |||||
Vested and converted to common stock | (146,307 | ) | 18.80 | ||||
Forfeited | (27,016 | ) | 20.74 | ||||
Outstanding on December 31, 2015 | 473,935 | 19.98 | |||||
Granted | 207,405 | 22.92 | |||||
Vested and converted to common stock | (119,455 | ) | 20.02 | ||||
Forfeited | (24,612 | ) | 22.81 | ||||
Outstanding on December 31, 2016 | 537,273 | 20.97 | |||||
Granted | 243,306 | 24.18 | |||||
Vested and converted to common stock | (217,028 | ) | 21.39 | ||||
Forfeited | (72,397 | ) | 24.05 | ||||
Outstanding on December 31, 2017 | 491,154 | 21.92 |
Number of Performance Stock Units | Weighted- Average Grant-date Fair Value | ||||||
Outstanding on December 31, 2014 | 229,170 | $ | 17.06 | ||||
Granted | 59,221 | 23.64 | |||||
Vested and converted to common stock | (13,397 | ) | 20.62 | ||||
Forfeited | (2,970 | ) | 20.62 | ||||
Outstanding on December 31, 2015 | 272,024 | 18.28 | |||||
Granted | 125,388 | 22.98 | |||||
Vested and converted to common stock | (160,600 | ) | 15.51 | ||||
Forfeited | — | — | |||||
Outstanding on December 31, 2016 | 236,812 | 22.64 | |||||
Granted | 88,415 | 23.83 | |||||
Vested and converted to common stock | (70,652 | ) | 19.65 | ||||
Forfeited | (68,684 | ) | 24.07 | ||||
Outstanding on December 31, 2017 | 185,891 | 23.82 |
14. | Changes in Accumulated Other Comprehensive Income |
Available- for- Sale Securities | Foreign Currency Translation | Pension | AOCI | |||||||||||||
Balance at December 31, 2016 | $ | 3,429 | $ | 2,290 | $ | (2,397 | ) | $ | 3,322 | |||||||
Other comprehensive income before classification, net of tax | 3,108 | 6,853 | 383 | 10,344 | ||||||||||||
Amount reclassified from AOCI (1) | (448 | ) | — | 97 | (351 | ) | ||||||||||
Net current period other comprehensive income | 2,660 | 6,853 | 480 | 9,993 | ||||||||||||
Balance at December 31, 2017 | $ | 6,089 | $ | 9,143 | $ | (1,917 | ) | $ | 13,315 |
(1) | Available-for-Sale Securities and Pension reclassifications from AOCI are included in Other, net and Salaries and employee benefits, respectively, in the Consolidated Statement of Comprehensive Income (Loss). |
15. | Restructuring |
Restructuring Charges | ||||
Executive Search | ||||
Americas | $ | 784 | ||
Europe | 3,993 | |||
Asia Pacific | 2,046 | |||
Total Executive Search | 6,823 | |||
Leadership Consulting | 913 | |||
Culture Shaping | 2,480 | |||
Global Operations Support | 5,450 | |||
Total restructuring | $ | 15,666 |
Employee Related | Office Related | Other | Total | |||||||||||||
Accrual balance at December 31, 2016 | $ | — | $ | — | $ | — | $ | — | ||||||||
Restructuring charges | 13,065 | 308 | 2,293 | 15,666 | ||||||||||||
Cash payments | (1,199 | ) | (5 | ) | (1,282 | ) | (2,486 | ) | ||||||||
Non cash write-offs | — | (155 | ) | — | (155 | ) | ||||||||||
Accrual balance at December 31, 2017 | $ | 11,866 | $ | 148 | $ | 1,011 | $ | 13,025 |
16. | Income Taxes |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
United States | $ | (28,577 | ) | $ | 30,696 | $ | 26,550 | |||||
Foreign | (841 | ) | 7,070 | 5,004 | ||||||||
Income (loss) before income taxes | $ | (29,418 | ) | $ | 37,766 | $ | 31,554 |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Current | ||||||||||||
Federal | $ | 10,107 | $ | 12,261 | $ | 8,598 | ||||||
State and local | 2,372 | 3,219 | 1,697 | |||||||||
Foreign | 8,257 | 5,668 | 4,911 | |||||||||
Current provision for income taxes | 20,736 | 21,148 | 15,206 | |||||||||
Deferred | ||||||||||||
Federal | 5,642 | 727 | (1,551 | ) | ||||||||
State and local | (2,951 | ) | (370 | ) | (180 | ) | ||||||
Foreign | (4,210 | ) | 848 | 947 | ||||||||
Deferred provision (benefit) for income taxes | (1,519 | ) | 1,205 | (784 | ) | |||||||
Total provision for income taxes | $ | 19,217 | $ | 22,353 | $ | 14,422 |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Income tax provision (benefit) at the statutory U.S. federal rate | $ | (10,296 | ) | $ | 13,218 | $ | 11,044 | |||||
State income tax provision (benefit), net of federal tax benefit | (593 | ) | 1,904 | 1,272 | ||||||||
Nondeductible expenses, net | 3,282 | 1,410 | 262 | |||||||||
Foreign taxes (includes rate differential and changes in foreign valuation allowance) | 5,465 | (2,133 | ) | 368 | ||||||||
Establishment (release) of valuation allowance | (3,200 | ) | 340 | — | ||||||||
U.S. tax on foreign dividends | — | 5,898 | 1,120 | |||||||||
Current/deferred true-up | 567 | 1,226 | 241 | |||||||||
Tax reform | 23,732 | — | — | |||||||||
Other, net | 260 | 490 | 115 | |||||||||
Total provision for income taxes | $ | 19,217 | $ | 22,353 | $ | 14,422 |
December 31, | ||||||||
2017 | 2016 | |||||||
Deferred tax assets attributable to: | ||||||||
Foreign net operating loss carryforwards | $ | 31,960 | $ | 26,902 | ||||
Accrued compensation and employee benefits | 15,809 | 18,625 | ||||||
Deferred compensation | 13,600 | 17,851 | ||||||
Foreign tax credit carryforwards | 8,128 | 12,112 | ||||||
Accrued rent | 3,607 | 5,113 | ||||||
Other accrued expenses | 2,179 | 3,388 | ||||||
Deferred tax assets, before valuation allowance | 75,283 | 83,991 | ||||||
Valuation allowance | (35,624 | ) | (25,020 | ) | ||||
Deferred tax assets, after valuation allowance | 39,659 | 58,971 | ||||||
Deferred tax liabilities attributable to: | ||||||||
Goodwill | 306 | 17,130 | ||||||
Taxes provided on unremitted earnings | 129 | 3,331 | ||||||
Depreciation on property and equipment | 3,216 | 4,723 | ||||||
Other | 606 | 966 | ||||||
Deferred tax liabilities | 4,257 | 26,150 | ||||||
Net deferred tax assets | $ | 35,402 | $ | 32,821 |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Gross unrecognized tax benefits at January 1, | $ | 1,038 | $ | 130 | $ | 143 | ||||||
Gross increases for tax positions of prior years | 167 | 2,146 | 22 | |||||||||
Gross decreases for tax positions of prior years | — | (4 | ) | (15 | ) | |||||||
Settlements | (465 | ) | (1,234 | ) | (20 | ) | ||||||
Lapse of statute of limitations | — | — | — | |||||||||
Gross unrecognized tax benefits at December 31, | $ | 740 | $ | 1,038 | $ | 130 |
17. | Segment Information |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Revenue | ||||||||||||
Executive Search | ||||||||||||
Americas | $ | 339,793 | $ | 313,292 | $ | 294,606 | ||||||
Europe | 125,346 | 108,754 | 92,135 | |||||||||
Asia Pacific | 86,905 | 85,319 | 89,026 | |||||||||
Total Executive Search | 552,044 | 507,365 | 475,767 | |||||||||
Leadership Consulting | 41,227 | 38,806 | 19,045 | |||||||||
Culture Shaping | 28,129 | 36,219 | 36,327 | |||||||||
Revenue before reimbursements | 621,400 | 582,390 | 531,139 | |||||||||
Reimbursements | 18,656 | 18,516 | 17,172 | |||||||||
Total revenue | $ | 640,056 | $ | 600,906 | $ | 548,311 | ||||||
Operating Income (Loss) | ||||||||||||
Executive Search | ||||||||||||
Americas (1) | $ | 81,531 | $ | 73,857 | $ | 68,043 | ||||||
Europe (2) | 2,038 | 6,851 | 3,644 | |||||||||
Asia Pacific (3) | 2,128 | 4,799 | 5,909 | |||||||||
Total Executive Search | 85,697 | 85,507 | 77,596 | |||||||||
Leadership Consulting (4) | (15,614 | ) | (1,495 | ) | (1,847 | ) | ||||||
Culture Shaping (5) | (41,818 | ) | (1,558 | ) | 4,913 | |||||||
Total segments | 28,265 | 82,454 | 80,662 | |||||||||
Global Operations Support (6) | (54,788 | ) | (47,221 | ) | (46,600 | ) | ||||||
Total operating income (loss) | $ | (26,523 | ) | $ | 35,233 | $ | 34,062 | |||||
Depreciation and Amortization | ||||||||||||
Executive Search | ||||||||||||
Americas | $ | 4,661 | $ | 3,892 | $ | 3,858 | ||||||
Europe | 3,207 | 2,478 | 1,530 | |||||||||
Asia Pacific | 1,579 | 1,774 | 1,383 | |||||||||
Total Executive Search | 9,447 | 8,144 | 6,771 | |||||||||
Leadership Consulting | 2,240 | 2,501 | 393 | |||||||||
Culture Shaping | 1,646 | 4,341 | 4,520 | |||||||||
Total segments | 13,333 | 14,986 | 11,684 | |||||||||
Global Operation Support | 1,441 | 1,447 | 2,012 | |||||||||
Total depreciation and amortization | $ | 14,774 | $ | 16,433 | $ | 13,696 | ||||||
Capital Expenditures | ||||||||||||
Executive Search | ||||||||||||
Americas | $ | 7,123 | $ | 2,221 | $ | 7,334 | ||||||
Europe | 1,460 | 835 | 890 | |||||||||
Asia Pacific | 2,633 | 3,346 | 1,030 | |||||||||
Total Executive Search | 11,216 | 6,402 | 9,254 | |||||||||
Leadership Consulting | 470 | 380 | 330 | |||||||||
Culture Shaping | 702 | 279 | 95 | |||||||||
Total segments | 12,388 | 7,061 | 9,679 | |||||||||
Global Operation Support | 3,298 | 1,321 | 6,184 | |||||||||
Total capital expenditures | $ | 15,686 | $ | 8,382 | $ | 15,863 |
(1) | Operating income for the Americas includes $0.8 million of restructuring charges in 2017. |
(2) | Operating income for Europe includes $4.0 million of restructuring charges in 2017. |
(3) | Operating income for Asia Pacific includes $2.0 million of restructuring charges in 2017. |
(4) | Operating loss for Leadership Consulting includes $11.6 million of impairment charges and $0.9 million of restructuring charges in 2017. |
(5) | Operating loss for Culture Shaping includes $39.2 million of impairment charges and $2.5 million of restructuring charges in 2017. |
(6) | Operating loss for Global Operations Support includes $5.5 million of restructuring charges in 2017. |
December 31, | ||||||||
2017 | 2016 | |||||||
Current assets | ||||||||
Executive Search | ||||||||
Americas | $ | 171,985 | $ | 147,070 | ||||
Europe | 84,405 | 54,153 | ||||||
Asia Pacific | 55,196 | 60,704 | ||||||
Total Executive Search | 311,586 | 261,927 | ||||||
Leadership Consulting | 16,025 | 15,737 | ||||||
Culture Shaping | 15,091 | 19,059 | ||||||
Total segments | 342,702 | 296,723 | ||||||
Global Operations Support | 1,088 | 1,707 | ||||||
Total allocated current assets | 343,790 | 298,430 | ||||||
Unallocated non-current assets | 122,364 | 110,538 | ||||||
Goodwill and other intangible assets, net | ||||||||
Executive Search | ||||||||
Americas | 88,942 | 88,602 | ||||||
Europe | 22,699 | 22,029 | ||||||
Asia Pacific | 9,409 | 9,020 | ||||||
Total Executive Search | 121,050 | 119,651 | ||||||
Leadership Consulting | — | 12,757 | ||||||
Culture Shaping | — | 40,126 | ||||||
Total goodwill and other intangible assets, net | 121,050 | 172,534 | ||||||
Total assets | $ | 587,204 | $ | 581,502 |
18. | Guarantees |
19. | Commitments and Contingencies |
2018 | $ | 36,386 | |
2019 | 31,121 | ||
2020 | 22,869 | ||
2021 | 18,860 | ||
2022 | 16,229 | ||
Thereafter | 22,600 | ||
Total | $ | 148,065 |
20. | Subsequent Events |
(a) | (b) | (c) | |||||||||
Plan Category | Number of securities to be issued upon exercise of outstanding options | Weighted- average exercise price of outstanding options | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | ||||||||
Equity compensation plans approved by stockholders | 685,922 | (1) | $ | 33.79 | 797,453 | ||||||
Equity compensation plans not approved stockholders | — | — | — | ||||||||
Total equity compensation plans | 685,922 | $ | 33.79 | 797,453 |
(1) | Includes 491,154 restricted stock units, 185,891 performance stock units at their target levels and 8,877 options. |
(a) | THE FOLLOWING DOCUMENTS ARE FILED AS PART OF THIS REPORT: |
Exhibit No. | Description | |
3.01 | Amended and Restated Certificate of Incorporation of the Registrant (Incorporated by reference to Exhibit 3.02 of this Registrant’s Registration Statement on Form S-4 (File No. 333-61023)) | |
3.02 | ||
4.01 | ||
10.01 | ||
10.02 | ||
10.03 | ||
10.04 | ||
10.05 | ||
10.06 | ||
10.07 | ||
10.08 | ||
10.09 | ||
10.10 | ||
10.11 | ||
10.12 | ||
10.13 | ||
10.14 | ||
10.15 | ||
10.16 | ||
10.17 | ||
10.18 | ||
10.19 | ||
10.20 | ||
10.21 | ||
10.22 | ||
10.23 | ||
10.24 | ||
10.25 | ||
10.26 | ||
10.27 | ||
10.28 | ||
10.29 | ||
10.30 | ||
10.31 | ||
10.32 | ||
10.33 | ||
10.34 | ||
10.35 | ||
10.36 | ||
10.37 | ||
10.38 | ||
10.39 | ||
10.40 | ||
10.41 | ||
10.42 | ||
10.43 | ||
10.44 | ||
*21.01 | ||
*23.01 | ||
*31.1 | ||
*31.2 | ||
*32.1 | ||
*32.2 | ||
*101.INS | XBRL Instance document | |
*101.SCH | XBRL Taxonomy Extension Schema Document | |
*101.CAL | XBRL Taxonomy Calculation Linkbase Document | |
*101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
*101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
*101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
(b) | SEE EXHIBIT INDEX ABOVE |
(c) | FINANCIAL STATEMENTS NOT PART OF ANNUAL REPORT |
HEIDRICK & STRUGGLES INTERNATIONAL, INC. | ||
/s/ Stephen A. Bondi | ||
By: | Stephen A. Bondi | |
Title: | Vice President, Controller |
Signature | Title | |
/s/ Krishnan Rajagopalan | Chief Executive Officer & Director | |
Krishnan Rajagopalan (Principal Executive Officer) | ||
/s/ Richard W. Pehlke | Executive Vice President & Chief Financial Officer | |
Richard W. Pehlke (Principal Financial Officer) | ||
/s/ Stephen A. Bondi | Vice President, Controller | |
Stephen A. Bondi (Principal Accounting Officer) | ||
/s/ Elizabeth L. Axelrod | Director | |
Elizabeth L. Axelrod | ||
/s/ Richard I. Beattie | Director | |
Richard I. Beattie | ||
/s/ Clare M. Chapman | Director | |
Clare M. Chapman | ||
/s/ Gary E. Knell | Director | |
Gary E. Knell | ||
/s/ Lyle Logan | Director | |
Lyle Logan | ||
/s/ T. Willem Mesdag | Director | |
T. Willem Mesdag | ||
/s/ Adam Warby | Director | |
Adam Warby | ||
/s/ Tracy R. Wolstencroft | Director | |
Tracy R. Wolstencroft | ||
1. | I have reviewed this annual report on Form 10-K of Heidrick & Struggles International, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Dated: March 13, 2018 | /s/ Krishnan Rajagopalan | |
Krishnan Rajagopalan | ||
Chief Executive Officer |
1. | I have reviewed this annual report on Form 10-K of Heidrick & Struggles International, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Dated: March 13, 2018 | /s/ Richard W. Pehlke | |
Richard W. Pehlke | ||
Executive Vice President and Chief Financial Officer |
Dated: March 13, 2018 | /s/ Krishnan Rajagopalan | |
Krishnan Rajagopalan | ||
Chief Executive Officer |
Dated: March 13, 2018 | /s/ Richard W. Pehlke | |
Richard W. Pehlke | ||
Executive Vice President and Chief Financial Officer |
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Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Mar. 09, 2018 |
Jun. 30, 2017 |
|
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2017 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | HSII | ||
Entity Registrant Name | HEIDRICK & STRUGGLES INTERNATIONAL INC | ||
Entity Central Index Key | 0001066605 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 18,813,585 | ||
Entity Public Float | $ 408,475,592 |
Consolidated Balance Sheets (Parenthetical) - $ / shares |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 19,585,777 | 19,585,777 |
Common stock, shares outstanding | 18,781,433 | 18,578,176 |
Treasury stock, shares | 804,344 | 1,007,601 |
Consolidated Statements of Changes In Stockholders' Equity (Parenthetical) - $ / shares |
12 Months Ended | ||
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Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
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Cash dividends per share (in dollars per share) | $ 0.52 | $ 0.52 | $ 0.52 |
Retained Earnings [Member] | |||
Cash dividends per share (in dollars per share) | $ 0.52 | $ 0.52 | $ 0.52 |
Basis of Presentation |
12 Months Ended |
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Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Heidrick & Struggles International, Inc. and Subsidiaries (the “Company”) is engaged in providing executive search, culture shaping and leadership consulting services to clients on a retained basis. The Company operates in the Americas, Europe and Asia Pacific regions. The consolidated financial statements include Heidrick & Struggles International, Inc. and its wholly-owned subsidiaries and have been prepared using accounting principles generally accepted in the United States of America (“GAAP”). The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Significant items subject to estimates and assumptions include revenue recognition, allowances for deferred tax assets and liabilities, and assessment of goodwill and other intangible assets for impairment. Estimates are subject to a degree of uncertainty and actual results could differ from these estimates. |
Summary of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of three months or less to be cash equivalents. Concentration of Risk The Company is potentially exposed to concentrations of risk associated with its accounts receivable. However, this risk is limited due to the Company’s large number of clients and their dispersion across many different industries and geographies. At December 31, 2017 and 2016, the Company had no significant concentrations of risk. Accounts Receivable The Company’s accounts receivable consist of trade receivables. The allowance for doubtful accounts is developed based upon several factors including the age of the Company’s accounts receivable, historical write-off experience and specific account analysis. These factors may change over time, impacting the allowance level. Fair Value of Financial Instruments Cash equivalents are stated at cost, which approximates fair market value. The carrying value for receivables from clients, accounts payable, deferred revenue and other accrued liabilities reasonably approximate fair market value due to the nature of the financial instruments and the short term nature of the items. Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful life of the asset or, for leasehold improvements, the shorter of the lease term or the estimated useful life of the asset, as follows:
Leasehold improvements are depreciated over the lesser of the lease term or life of the asset improvement, which typically range from three to ten years. Depreciation is calculated for tax purposes using accelerated methods, where applicable. Long-lived Assets The Company reviews its long-lived assets, including property and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge, equal to the amount by which the carrying amount of the asset exceeds the fair value of the asset, is recognized. Investments The Company’s investments consist primarily of available-for-sale investments within the U.S. non-qualified deferred compensation plan (the “Plan”). Available-for-sale investments are reported at fair value with changes in unrealized gains (losses) recorded as a separate component of Accumulated other comprehensive income in the Consolidated Balance Sheets until realized. Realized gains (losses) resulting from an employee’s termination from the Plan are recorded as a non-operating expense in Other, net in the Consolidated Statements of Comprehensive Income (Loss). Goodwill and Other Intangible Assets Goodwill represents the difference between the purchase price of acquired companies and the related fair value of the net assets acquired, which is accounted for by the acquisition method of accounting. Other intangible assets include client relationships and employee non-compete agreements. The Company performs assessments of the carrying value of goodwill at least annually and of its goodwill and other intangible assets whenever events occur or circumstances indicate that a carrying amount of these assets may not be recoverable. These circumstances include a significant change in business climate, attrition of key personnel, changes in financial condition or results of operations, a prolonged decline in the Company’s stock price and market capitalization, competition, and other factors. The goodwill impairment test compares the fair value of a reporting unit to its carrying amount, including goodwill. The Company operates five reporting units: Americas; Europe, which includes Africa; Asia Pacific, which includes the Middle East; Leadership Consulting; and Culture Shaping. The goodwill impairment test is completed by comparing the fair value of a reporting unit with its carrying amount. The fair value of each of the Company’s reporting units is determined using a discounted cash flow methodology. An impairment charge is recognized for the amount by which the carrying value of the reporting unit exceeds its fair value, however, the loss recognized is not to exceed the total amount of goodwill allocated to that reporting unit. The other intangible asset impairment review compares the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge, equal to the amount by which the carrying amount of the asset exceeds the fair value, is recognized. Other intangible assets acquired are amortized either using the straight-line method over their estimated useful lives or based on the projected cash flow associated with the respective intangible assets. Restructuring Charges The Company accounts for restructuring charges by recognizing a liability at fair value when the costs are incurred. Revenue Recognition Revenue before reimbursements of out-of-pocket expenses (“net revenue”) consists of retainers and indirect expenses billed to clients. For each assignment, the Company and its client enter into a contract that outlines the general terms and conditions of the assignment. Typically, the Company is paid a retainer for its executive search services equal to approximately one-third of the estimated first year compensation for the position to be filled. In addition, generally, if the actual compensation of a placed candidate exceeds the estimated compensation, the Company often is authorized to bill the client for one-third of the excess. Indirect expenses are calculated as a percentage of the retainer with certain dollar limits per search. The Company generally bills its clients for its retainer and indirect expenses in one-third increments over a three-month period commencing in the month of a client’s acceptance of the contract. Net revenue is recognized when earned and realizable and therefore when the following criteria have been met: (a) persuasive evidence of an arrangement exists, (b) services have been rendered, (c) the fee to our client is fixed or determinable, and (d) collectability is reasonably assured. Taxes collected from clients and remitted to governmental authorities are presented on a net basis. Typically, net revenue from standard executive search engagements is recognized over the expected average period of performance, in proportion to the estimated personnel time incurred to fulfill our obligations under the arrangements. Net revenue in excess of the retainer, resulting from actual compensation of the placed candidate exceeding the estimated compensation, is recognized upon completion of the executive search when the amount of the additional fee is known. Net revenue associated with culture shaping services is recognized proportionally as services are performed. Net revenue associated with licenses to use our culture shaping proprietary materials is typically recognized over the term of the arrangement. Depending on the terms of that agreement, net revenue from certain leadership consulting and non-standard executive search engagements is either recognized proportionally as services are performed or in accordance with the completion of the engagement deliverables. Reimbursements The Company incurs certain out-of-pocket expenses that are reimbursed by its clients, which are accounted for as revenue and expense in its Consolidated Statements of Comprehensive Income (Loss). Salaries and Employee Benefits Salaries and employee benefits consist of compensation and benefits paid to consultants, executive officers, and administrative and support personnel, of which the most significant elements are salaries and annual performance-related bonuses. Other items in this category are expenses related to sign-on bonuses, forgivable employee loans and minimum guaranteed bonuses (often incurred in connection with the hiring of new consultants), restricted stock unit and performance share unit amortization, payroll taxes, profit sharing and retirement benefits, and employee insurance benefits. Salaries and employee benefits are recognized on an accrual basis. Certain sign-on bonuses, retention awards, and minimum guaranteed compensation are capitalized and amortized in accordance with the terms of the respective agreements. A portion of the Company’s consultants’ and management cash bonuses are deferred and paid over a three-year vesting period. The portion of the bonus is approximately 15% depending on the employee’s level or position. The compensation expense related to the amounts being deferred is recognized on a graded vesting attribution method over the requisite service period. This service period begins on January 1 of the respective fiscal year and continues through the deferral date, which coincides with the Company’s bonus payments in the first quarter of the following year, and for an additional three year vesting period. The deferrals are recorded in Accrued salaries and employee benefits within both Current liabilities and Non-current liabilities in the Consolidated Balance Sheets. Income Taxes Deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities, applying enacted statutory tax rates in effect for the year in which the tax differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Earnings per Common Share Basic earnings per common share is computed by dividing net income by weighted average common shares outstanding for the year. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted. Common equivalent shares are excluded from the determination of diluted earnings per share in periods in which they have an anti-dilutive effect. The following table sets forth the computation of basic and diluted earnings (loss) per share:
Translation of Foreign Currencies The Company generally designates the local currency for all its subsidiaries as the functional currency. The Company translates the assets and liabilities of its subsidiaries into U.S. dollars at the current rate of exchange prevailing at the balance sheet date. Revenue and expenses are translated at a monthly average exchange rate for the period. Translation adjustments are reported as a component of Accumulated other comprehensive income. Restricted Cash The Company has lease agreements and business licenses with terms that require the Company to restrict cash through the termination dates of the agreements, which extend through 2019. During 2016, the Company paid certain key executives of Senn Delaney a $6.5 million retention bonus out of restricted cash for remaining with the Company for three years subsequent to the acquisition. As of December 31, 2017 and 2016, the total restricted cash was $0.6 million and $0.6 million, respectively. Current and non-current restricted cash is included in Other current assets and Other non-current assets, respectively, on the Consolidated Balance Sheet. Recently Issued Financial Accounting Standards In May 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-09, Compensation - Stock Compensation, Scope of Modification Accounting, which is intended to provide clarity and reduce both diversity in practice, cost and complexity when implementing a change in the terms or conditions of a share-based payment award. ASU 2017-09 requires that an entity should account for the effects of a modification unless the fair value, vesting conditions, and whether the award is classified as a liability instrument or an equity instrument remain unchanged in the modification. ASU 2017-09 is effective for interim and annual periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. The impact of this accounting guidance will be dependent on future modification events including the number of awards modified. In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost, which is intended to improve the consistency, transparency and usefulness of net benefit cost disclosures. ASU 2017-07 requires that an employer report the service cost component of net benefit cost in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. Additionally, the other components of net benefit costs are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. ASU 2017-07 is effective for interim and annual periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. The impact of this accounting guidance will not be material to the Company's financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash, which requires that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore amounts generally described as restricted cash should be included with cash and cash equivalents when reconciling the beginning of period and end of period total amounts shown on the statement of cash flows. The Company currently does not include restricted cash amounts in the beginning and ending cash amounts and will change the presentation of the cash flow statement to include restricted cash in the beginning and ending cash totals. The standard is effective for annual reporting periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. If the Company had adopted the guidance as of December 31, 2017, the beginning and ending balance of cash, cash equivalents and restricted cash for the year ended December 31, 2017 would have each increased by $0.6 million in the Condensed Consolidated Statement of Cash Flows. In August 2016, the Financial Accounting Standards Board ("FASB") issued accounting Standards Update ("ASU") No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, which is intended to reduce diversity in practice as to how certain cash receipts and cash payments should be presented and classified. The standard is effective for interim and annual reporting periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. The Company has evaluated the standard and noted the guidance for contingent consideration payments made after a business combination are applicable to the Condensed Consolidated Statements of Cash Flows. The Company currently classifies all contingent consideration payments as financing activities. The impact of this change is not expected to be significant to the classification of these activities on the Consolidated Statement of Cash Flows. In February 2016, the FASB issued ASU No. 2016-02, Leases, intended to improve financial reporting about leasing transactions. The new guidance will require entities that lease assets to recognize on their balance sheets the assets and liabilities for the rights and obligations created by those leases and to disclose key information about the leasing arrangements. ASU 2016-02 is effective for interim and annual periods beginning after December 15, 2018 with early adoption permitted. The guidance requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the impact of this accounting guidance. The effect is not known or reasonably estimable at this time. In January 2016, the FASB issued ASU 2016-01, Financial Instruments: Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments including the recognition of unrealized changes in fair value within net income. The standard is effective for annual reporting periods beginning after December 15, 2017. The Company will adopt this guidance effective January 1, 2018. Upon adoption, the Company will reclassify approximately $6.1 million of unrecognized gains on the Company's available for sale securities, which are currently included in accumulated other comprehensive income, to retained earnings. Future holding gains on the Company's available for sale securities will be recorded in earnings. During the year ended December 31, 2017, the Company had holding gains of approximately $2.7 million prior to the reclassification of realized gains to earnings, on its available for sale securities, which would have been recognized in earnings under ASU 2016-01. The amount of future holding gains or losses is dependent upon market conditions and may substantially fluctuate between periods. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers. The ASU requires that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for these goods or services. The guidance is effective for interim and annual reporting periods beginning after December 15, 2017. The guidance permits the use of either of the following transition methods: (i) a full retrospective method reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or (ii) a retrospective method with the cumulative effect upon initial adoption recognized at the date of initial application (modified retrospective). The Company will adopt the guidance on January 1, 2018 and will apply the modified retrospective method, which involves recognizing the cumulative effect of applying the guidance at the date of initial application with no restatement of the comparative periods presented. The Company continues to perform its evaluation of ASU No. 2014-09 and has made certain assessments regarding each of its primary revenue streams. Executive Search - The Company’s executive search engagements involve the receipt of a retainer that is equal to approximately one-third of the estimated first year compensation for the position to be filled. If actual compensation of a placed candidate exceeds the original compensation estimate, the Company is often authorized to bill the client for one-third of the excess compensation. The Company refers to this excess compensation billing as uptick revenue. Currently, the Company recognizes uptick revenue upon the completion of the executive search at the point the uptick revenue becomes fixed and determinable. Under ASU No. 2014-09, uptick revenue is considered variable consideration and the Company will be required to estimate this revenue at contract inception. The Company has developed an estimation process utilizing the expected value method, incorporating historical uptick revenue realized in the Company’s geographic regions and industry practices, which will result in an initial recording of a contract’s uptick revenue that is probable not to result in a significant reversal of cumulative revenue recognized when the actual amount of uptick revenue for that contract is known. Estimates of uptick revenue will be recognized using the same over time revenue recognition model the Company currently utilizes to recognize retainer revenue, and differences between the estimated and actual amount of uptick revenue will be recorded when known. Typically, revenue from executive search engagements is recognized over the expected average period of performance, in proportion to the estimated personnel time incurred to fulfill our obligations under the executive search arrangement. The Company is currently quantifying the required transition adjustment for the Executive Search revenue streams. Leadership Consulting - The Company does not anticipate a significant change in revenue recognition as it relates to its leadership consulting engagements. Substantially all of the Company’s engagements will continue to be recognized over time although the identification of the performance obligations within any given engagement may differ from the Company’s current revenue recognition methodology. Culture Shaping - The Company does not anticipate a significant change in revenue recognition as it relates to its culture shaping consulting engagements. Substantially all of the Company’s consulting engagements will continue to be recognized over time although the identification of the performance obligations within any given engagement may differ from the Company’s current revenue recognition methodology. The Company has concluded that licenses to use our proprietary culture shaping materials, which the Company refers to as enterprise agreements, generally contain a material right resulting in the recognition of this type of revenue over a longer period of time. The Company is currently quantifying the required transition adjustment. Recently Adopted Financial Accounting Standards In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other, which eliminates Step 2 from the goodwill impairment test. Instead, under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The Board also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity is required to disclose the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount of net assets. The Company early adopted ASU 2017-04, during the three months ended June 30, 2017. The Company concluded that ASU 2017-04 is preferable to the current guidance included in ASC 350 due to the simplified process of subsequently measuring goodwill. |
Allowance for Doubtful Accounts |
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Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The activity of the allowance for doubtful accounts for the years ended:
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Property and Equipment, net |
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Property and Equipment, net | Property and Equipment, net The components of the Company’s property and equipment are as follows:
Depreciation expense for the years ended December 31, 2017, 2016, and 2015 was $10.4 million, $9.4 million, and $8.8 million, respectively. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: •Level 1 – Quoted prices in active markets for identical assets and liabilities. •Level 2 – Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. •Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following tables provide a summary of the fair value measurements at December 31, 2017 and 2016 for each major category of assets and liabilities measured at fair value on a recurring basis:
The Level 2 assets above are reinsurance contracts fair valued in accordance with BaFin - German Federal Financial Supervisory Authority guidelines, which utilize observable inputs including mortality tables and discount rates. The Level 3 liabilities are accruals for future earnout payments related to prior year acquisitions, the values of which are determined based on discounted cash flow models. The Company considers the recorded value of its financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, and accounts payable, to approximate the fair value of the respective assets and liabilities at December 31, 2017 and 2016 based upon the short-term nature of the assets and liabilities. The following table provides a reconciliation of the beginning and ending balance of Level 3 assets and liabilities for the year ended December 31, 2017.
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Investments |
12 Months Ended |
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Dec. 31, 2017 | |
Investments Schedule [Abstract] | |
Investments | Investments The Company has a U.S. non-qualified deferred compensation plan that consists primarily of U.S. marketable securities and mutual funds, all of which are valued using Level 1 inputs (See Note 6, Fair Value Measurements). The fair value for these investments was $21.3 million and $17.3 million as of December 31, 2017 and 2016, respectively. The aggregate cost basis for these investments was $14.6 million and $13.3 million as of December 31, 2017 and 2016, respectively. |
Acquisition |
12 Months Ended |
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Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisition | Acquisitions On October 1, 2015, the Company acquired Co Company, a UK-based management consulting firm that specializes in organizational development. The former owners of Co Company were eligible to receive additional cash consideration upon the realization of specific revenue and EBITDA Margin milestones achieved over the period October 2015 through December 2018. On August 25, 2016, the Company and the former owners of Co Company entered into a Deed of Amendment (the "Amendment") to the Share Purchase Agreement dated October 1, 2015. The Amendment adjusted the target fee revenue and targeted EBITDA margin for each remaining earn out period taking into consideration the unanticipated acquisitions completed subsequent to the Share Purchase Agreement. The new targets include subsequent acquisitions and took effect retrospectively from January 1, 2016. On June 14, 2017, the Company and the former owners of Co Company entered into an Earn Out Buyout Agreement (the “Buyout Agreement”) in accordance with the terms and conditions of the Share Purchase Agreement dated October 1, 2015, as amended by a Deed of Amendment dated August 25, 2016. Pursuant to the Buyout Agreement, in accordance with the Share Purchase Agreement and Deed of Amendment, the Company exercised its right to buy out all of the remaining earnout amounts. The price paid to buy out the Remaining Earn Out Amounts was calculated in accordance with the formula set forth in the Purchase Agreement and resulted in an aggregate buyout payment to the former owners of Co Company of $2.3 million during the three months ended June 30, 2017. On September 1, 2016 the Company acquired substantially all of the assets of Philosophy IB, LLP ("Philosophy IB"), a New Jersey-based leadership, organization development and management consulting firm. The former owners of Philosophy IB are eligible to receive additional cash consideration based on two components: achieving revenue milestones generated from its software products from September 2016 through August 2019 and percentage of consulting revenue achieved over the period September 2016 to August 2019, subject to a profitability test. During the three months ended September 30, 2017, the Company determined that the software and consulting revenue targets for the period from September 2016 to August 2017, or first installment, would not be achieved. As such, the Company reduced the first installment earnout accrual by $0.7 million. |
Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill The Company's goodwill by segment is as follows:
Changes in the carrying amount of goodwill by segment for the years ended December 31, 2017, 2016, and 2015 were as follows:
In 2017, the Culture Shaping business continued the transition of senior-level personnel which began in 2016, primarily due to planned retirements. The Company has experienced lower than expected consultant productivity during the transition period. Also, the marketplace for culture shaping services has become increasingly more competitive and the business experienced lengthening sales cycles and decision processes within target client organizations. These events led to a decline in the revenue performance of the business and uncertainty around the timing of improving such performance. As a result, the Company identified a triggering event and performed an interim impairment evaluation on the goodwill related to its Culture Shaping reporting unit during the three months ended June 30, 2017. During the impairment evaluation process, the Company used a discounted cash flow methodology to estimate the fair value of its Culture Shaping reporting unit. The discounted cash flow approach is dependent on a number of factors, including estimates of future market growth and trends, forecasted revenue and costs, capital investments, appropriate discount rates, certain assumptions to allocate shared costs, assets and liabilities, historical and projected performance of the reporting unit, and the macroeconomic conditions affecting each of the Company’s reporting units. The assumptions used in the determination of fair value were (1) a forecast of growth in the near and long term; (2) the discount rate; (3) working capital investments; and (4) other factors. The Company adopted ASU No. 2017-04, Intangibles - Goodwill and Other in conjunction with its impairment evaluation during the three months ended June 30, 2017. Under the adopted guidance, Step 2 of the goodwill impairment test is eliminated. Instead, the goodwill impairment test is completed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value of the reporting unit exceeds its fair value, however, the loss recognized is not to exceed the total amount of goodwill allocated to that reporting unit. Based on the results of the impairment evaluation, the Company determined that the goodwill within the Culture Shaping reporting unit was impaired, which resulted in an impairment charge of $29.3 million to write-off all of the goodwill. The impairment charge is recorded within Impairment charges in the Condensed Consolidated Statement of Comprehensive Income (Loss). The impairment was non-cash in nature and did not affect our current liquidity, cash flows, borrowing capability or operations; nor did it impact the debt covenants under our credit agreement. During the 2017 fourth quarter, the Company conducted its annual goodwill impairment evaluation as of October 31, 2017 in accordance with ASU No. 2017-04, Intangibles - Goodwill and Other. The goodwill impairment test is completed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value of the reporting unit exceeds its fair value, however, the loss recognized is not to exceed the total amount of goodwill allocated to that reporting unit. The impairment test is considered for each of the Company’s reporting units that have goodwill as defined in the accounting standard for goodwill and intangible assets. The Company operates five reporting units: Americas; Europe, which includes Africa; Asia Pacific, which includes the Middle East; Leadership Consulting; and Culture Shaping. No annual impairment test was conducted for the Culture Shaping reporting unit as all goodwill associated with this reporting unit was impaired during the three months ended June 30, 2017. During the impairment evaluation process, the Company used a discounted cash flow methodology to estimate the fair value of each of its reporting units with goodwill. The discounted cash flow approach is dependent on a number of factors, including estimates of future market growth and trends, forecasted revenue and costs, capital investments, appropriate discount rates, certain assumptions to allocate shared costs, assets and liabilities, historical and projected performance of the reporting unit, and the macroeconomic conditions affecting each of the Company’s reporting units. The assumptions used in the determination of fair value were (1) a forecast of growth in the near and long term; (2) the discount rate; (3) working capital investments; and (4) other factors. Based on the results of the impairment analysis, the fair values of the Americas, Europe and Asia Pacific reporting units exceeded their carrying values by 180%, 38% and 7%, respectively. The Leadership Consulting impairment analysis indicated that the book value of the reporting unit was in excess of its fair value, which resulted in an impairment charge of approximately $6.9 million to write-off all of the goodwill associated with the reporting unit. Throughout the year, the Company was continually evaluating the results of its Leadership Consulting business, including Philosophy IB failing to achieve targets outlined in its earnout agreement and the potential impact of the conclusion of the Co Company earnout on the reporting unit. In the fourth quarter, the Company finalized its assessment of these events and its forecast for the Leadership Consulting reporting unit in future years. The forecast for the Leadership Consulting reporting unit indicated significant uncertainty around the pace and timing of growth in profitability in the Leadership Consulting reporting unit as the Company invests in talent and service offerings, which resulted in the impairment of the Leadership Consulting goodwill. The impairment was non-cash in nature and did not affect our current liquidity, cash flows, borrowing capability or operations; nor did it impact the debt covenants under our credit agreement. The fair value of the Asia Pacific reporting unit may deteriorate and could result in the need to record an impairment charge in future periods. The Company continues to monitor potential triggering events including changes in the business climate in which it operates, the Company’s market capitalization compared to its book value, and the Company’s recent operating performance, specifically in relation to the Asia Pacific reporting unit. Any changes in these factors could result in an impairment charge. Other Intangible Assets, net The Company’s other intangible assets, net by segment, are as follows:
As discussed above, the Culture Shaping business was impacted by the transition of senior-level personnel, primarily due to planned retirements, and the Company experienced lower than expected consultant productivity. The Company has also experienced lengthening sales cycles and decision processes within target client organizations. Due to the impact of these events on revenue and earnings when compared to actual and forecasted results, and the impact to the revenue and earnings inputs utilized in the fair value assessment of the intangible assets, the Company identified a triggering event for its Culture Shaping intangible assets and performed an impairment evaluation during the three months ended June 30, 2017. As noted above, due to the uncertainty around the pace and timing of growth in profitability in the Leadership Consulting reporting unit as the Company invests in talent and service offerings, the Company identified a triggering event for its Leadership Consulting intangible assets and performed an impairment evaluation as of October 31, 2017. These analyses were conducted in accordance with accounting guidance on fair value measurements taking into consideration Level 3 inputs, primarily consisting of discounted cash flow and replacement cost methodologies. Based on these evaluations, the Company recorded an impairment charge related to its Culture Shaping client relationships, trade name, software and non-compete intangible assets of $9.9 million during the year ended December 31, 2017. The Company also recorded an impairment charge related to its Leadership Consulting client relationships, software and non-compete intangible assets of $4.6 million during the year ended December 31, 2017. These impairment charges are recorded within Impairment charges in the Condensed Consolidated Statement of Comprehensive Income (Loss) for the year ended December 31, 2017. The impairments were non-cash in nature and did not affect our current liquidity, cash flows, borrowing capability or operations; nor did it impact the debt covenants under our credit agreement. The carrying amount of amortizable intangible assets and the related accumulated amortization were as follows:
Intangible asset amortization expense for the years ended December 31, 2017, 2016, and 2015 was $4.4 million , $7.1 million and $4.9 million respectively. The Company's estimated future amortization expense related to intangible assets as of December 31, 2017 for the years ended December 31st is as follows:
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Other Non-Current Liabilities |
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Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Non-Current Liabilities | Other Current and Non-Current Liabilities The components of other current liabilities are as follows:
The components of other non-current liabilities are as follows:
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Line of Credit |
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Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Line of Credit | Line of Credit On June 30, 2015, the Company entered into a Second Amended and Restated Credit Agreement (the “Restated Credit Agreement”). The Restated Credit agreement amended and restated the Credit Agreement executed on June 22, 2011 (the “Credit Agreement”). Pursuant to the Restated Credit Agreement, the Company replaced its Revolving Facility and Term Facility (“Existing Facility”) with a single senior unsecured revolving line of credit with an aggregate commitment of up to $100 million, which includes a sublimit of $25 million for letters of credit, and a $50 million expansion feature (the “Replacement Facility”). The Replacement Facility will mature on June 30, 2020. Borrowings under the Restated Credit Agreement bear interest at the Company’s election at the existing Alternate Base Rate (as defined in the Credit Agreement) or Adjusted LIBOR Rate (as defined in the Credit Agreement) plus a spread as determined by the Company’s leverage ratio. Borrowings under the Replacement Facility may be used for working capital, capital expenditures, Permitted Acquisitions (as defined in the Credit Agreement) and for other general purposes of the Company and its subsidiaries. The obligations under the Replacement Facility are guaranteed by certain of the Company's subsidiaries. During the three months ended March 31, 2017, the Company borrowed $40 million under the Restated Credit Agreement and elected the Adjusted LIBOR rate. The Company subsequently repaid $15 million during the three months ended March 31, 2017 and $25 million during the three months ended June 30, 2017. As of December 31, 2017 and 2016, the Company had no outstanding borrowings under the Restated Credit Agreement and the Company was in compliance with the financial and other covenants under the Restated Credit Agreement and no event of default existed. During the three months ended March 31, 2018, the Company borrowed $20 million under the Restated Credit Agreement and elected the Adjusted LIBOR Rate. |
Employee Benefit Plans |
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Dec. 31, 2017 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Qualified Retirement Plan The Company has a defined contribution retirement plan (the “Plan”) for all eligible employees in the United States. Eligible employees may begin participating in the Plan upon their hire date. The Plan contains a 401(k) provision, which provides for employee pre-tax and/or after-tax contributions, from 1% to 50% of their eligible compensation up to a combined maximum permitted by law. The Company matched employee contributions on a dollar for dollar basis per participant up to the greater of $6,000, or 6.0%, of eligible compensation for the years ended December 31, 2017 and December 31, 2016. The Company matched employee contributions up to the greater of $5,500, or 5.5%, of eligible compensation for the year ended December 31, 2015. Beginning in 2016, employees are eligible for the Company match immediately provided that they are working on the last day of the Plan year in which the match is made. Previously, employees were eligible for the Company match after satisfying a one year service requirement provided that they were working on the last day of the Plan year in which the match was made. The Plan also provides for employees who retire, die or become disabled during the Plan year to receive the Company match for that Plan year. The Plan provides that forfeitures will be used to reduce the Company’s contributions. Forfeitures are created annually by participants who terminate employment before becoming entitled to the Company’s matching contribution under the Plan. The Company also has the option of making discretionary contributions. There were no discretionary contributions made for the years ended December 31, 2017, 2016, and 2015. The expense that the Company incurred for matching employee contributions for the years ended December 31, 2017, 2016, and 2015 was $5.6 million, $4.8 million and $3.3 million, respectively. The Company maintains additional retirement plans in the Americas, Europe and Asia Pacific regions which the Company does not consider as material, and, therefore additional disclosure has not been presented. The balances associated with these plans have been reported in the Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2017, 2016, and 2015 and in the Consolidated Balance Sheets as of December 31, 2017 and 2016. Deferred Compensation Plans The Company has a deferred compensation plan for certain U.S. employees (the “U.S. Plan”) that became effective on January 1, 2006. The U.S. Plan allows participants to defer up to 25% of their base compensation and up to the lesser of $500,000 or 25% of their eligible bonus compensation into several different investment vehicles. These deferrals are immediately vested and are not subject to a risk of forfeiture. In 2017 and 2016, all deferrals in the U.S. Plan were funded. The compensation deferred in the U.S. Plan was $19.2 million and $14.9 million, at December 31, 2017 and 2016, respectively. The assets of the U.S. Plan are included in Investments and the liabilities of the U.S. Plan are included in Retirement and pension plans in the Consolidated Balance Sheets as of December 31, 2017 and 2016. The Company has a Non-Employee Directors Voluntary Deferred Compensation Plan whereby non-employee members of the Company’s Board of Directors may elect to defer up to 100% of the cash component of their directors’ fees into several different investment vehicles. As of December 31, 2017 and 2016, the total amounts deferred under the plan were $2.2 million and $2.4 million , respectively, all of which was funded. The assets of the plan are included in Investments and the liabilities of the plan are included in Retirement and pension plans in the Consolidated Balance Sheets at December 31, 2017 and 2016. The U.S. and Non-Employee Directors Voluntary Deferred Compensation Plans consist primarily of marketable securities and mutual funds, all of which are valued using Level 1 inputs (See Note 6, Fair Value Measurements). |
Pension Plan and Life Insurance Contract |
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Compensation and Retirement Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension Plan and Life Insurance Contract | Pension Plan and Life Insurance Contract The Company maintains a pension plan for certain current and former employees in Germany. The pensions are individually fixed Euro amounts that vary depending on the function and the eligible years of service of the employee.
The benefit obligation amounts recognized in the Consolidated Balance Sheets are as follows:
The accumulated benefit obligation amounts at December 31, 2017 and 2016 are $23.9 million million and $22.1 million million, respectively. The components of and assumptions used to determine the net periodic benefit cost are as follows:
Assumptions to determine the Company’s benefit obligation are as follows:
The amounts in Accumulated other comprehensive income as of December 31, 2017 and 2016 that had not yet been recognized as components of net periodic benefit cost were $3.7 million and $3.6 million, respectively. As of December 31, 2017, an insignificant amount of the accumulated other comprehensive income is expected to be recognized as a component of net periodic benefit cost in 2018. The Company’s investment strategy is to support its pension obligations through reinsurance contracts. The BaFin—German Federal Financial Supervisory Authority—supervises the insurance companies and the reinsurance contracts. The BaFin requires each reinsurance contract to guarantee a fixed minimum return. The Company’s pension benefits are fully reinsured by group insurance contracts with ERGO Lebensversicherung AG, and the group insurance contracts are measured in accordance with BaFin guidelines (including mortality tables and discount rates) which are considered Level 2 inputs (See Note 6, Fair Value Measurements). The fair value at December 31, 2017 and 2016 was $18.6 million million and $17.0 million, respectively. The expected contribution to be paid into the plan in 2018 is $1.5 million. Since the pension assets are not segregated in trust from the Company’s other assets, the pension assets are not shown as an offset against the pension liabilities in the Consolidated Balance Sheets. These assets are included in the Consolidated Balance Sheets at December 31, 2017 and 2016, as a component of Other current assets and Assets designated for retirement and pension plans. The benefits expected to be paid in each of the next five years, and in the aggregate for the five years thereafter are as follows:
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Stock-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation The Company's 2012 Heidrick & Struggles GlobalShare Program ( the "2012 Program') provides for grants of stock options, stock appreciation rights, and other stock-based awards that are valued based upon the grant date fair value of shares. These awards may be granted to directors, selected employees and independent contractors. The 2012 Program originally authorized 1,300,000 shares of Common Stock for issuance pursuant to awards under the plan. On May 22, 2014, the stockholders of the Company approved an amendment to the 2012 Program to increase the number of shares of Common Stock reserved for issuance under the 2012 Program by 700,000 shares. As of December 31, 2017, 1,744,266 awards have been issued under the 2012 Program and 797,453 shares remain available for future awards, which includes 541,719 forfeited awards. The 2012 Program provides that no awards can be granted after May 24, 2022. In September 2017, the Company entered into an agreement with its former Chief Executive Officer pursuant to which Mr. Wolstencroft voluntarily agreed, with the concurrence of the Board of Directors, to forfeit 100 percent of his 2017 restricted stock unit and performance stock unit grants. Mr. Wolstencroft remains eligible to continue vesting in 100 percent of his 2014 sign-on restricted stock unit grant, without proration, subject to his continued service on the board through the future scheduled vesting dates. With respect to his outstanding 2015 and 2016 restricted stock unit and performance stock unit grants, Mr. Wolstencroft remains eligible to earn an agreed upon pro-rata portion of the tranches scheduled to vest in 2017, 2018 and 2019, subject to his continued service as a director through the scheduled vesting dates (and with the performance goals for performance stock unit deemed to have been achieved at target level performance), and he agreed to forfeit the remaining portions of such 2015 and 2016 restricted stock unit and performance stock unit awards. The Company measures its stock-based compensation costs based on the grant date fair value of the awards and recognizes these costs in the financial statements over the requisite service period. A summary of information with respect to stock-based compensation is as follows:
Restricted Stock Units Restricted stock units are generally subject to ratable vesting over a three year period. Compensation expense related to service-based restricted stock units is recognized on a straight-line basis over the vesting period. For awards requiring satisfaction of service and performance conditions, compensation expense is recognized using a graded vesting attribution method. Restricted stock unit activity as of December 31, 2017, 2016, and 2015:
As of December 31, 2017, there was $2.8 million of pre-tax unrecognized compensation expense related to unvested restricted stock units, which is expected to be recognized over a weighted average of 1.8 years. Performance Stock Units The Company grants performance stock units to certain of its senior executives. The performance stock units are generally subject to a cliff vesting at the end of a three year period. The vesting will vary between 0% - 200% based on the attainment of operating income goals over the three year vesting period. The performance stock units are expensed on a straight-line basis over the three year vesting period. Performance share unit activity as of December 31, 2017, 2016, and 2015:
As of December 31, 2017, there was $1.1 million of pre-tax unrecognized compensation expense related to unvested performance stock units, which is expected to be recognized over a weighted average of 1.3 years. |
Changes in Accumulated Other Comprehensive Income |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Accumulated Other Comprehensive Income | Changes in Accumulated Other Comprehensive Income The changes in Accumulated other comprehensive income (“AOCI”) by component for the year ended December 31, 2017 are summarized below:
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Restructuring (Notes) |
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Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities Disclosure [Text Block] |
Restructuring Charges In 2017, the Company recorded restructuring charges of $15.7 million in connection with initiatives to reduce overall costs and improve operational efficiencies. The primary components of the restructuring include: the elimination of two executive officer roles for a flatter leadership structure; a workforce reduction as the firm aligns its support resources to better meet operational needs and recognize synergies with the combination of Leadership Consulting and Culture Shaping; a reduction of the firm’s real estate expenses and support costs by consolidating or closing three of its locations across its global footprint; and the acceleration of future expenses under certain contractual obligations. These charges consist of $13.1 million of employee-related costs, including severance associated with reductions in our workforce of 251 employees globally, $2.3 million of other professional and consulting fees and $0.3 million of expenses associated with closing three office locations. Restructuring charges by operating segment for the year ended December 31, 2017 are as follows:
The accrued restructuring charges at December 31, 2017 primarily consists of employee-related costs that require cash payments based on individual severance agreements, real estate leases that require cash payments through the lease terms reduced by sublease income and other professional fees. These accruals are included within Other current liabilities and Other non-current liabilities in the Consolidated Balance Sheets at December 31, 2017. The table below outlines the restructuring charges along with related cash payments for the year ended December 31, 2017:
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Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The sources of income (loss) before income taxes are as follows:
The provision for (benefit from) income taxes are as follows:
A reconciliation of the provision for income taxes to income taxes at the statutory U.S. federal income tax rate of 35% is as follows:
The deferred tax assets and liabilities are attributable to the following components:
The recognition of deferred tax assets is based on management’s belief that it is more likely than not that the tax benefits associated with temporary differences, net operating loss carryforwards and tax credits will be utilized. The Company assesses the recoverability of the deferred tax assets on an ongoing basis. In making this assessment, the Company considers all positive and negative evidence, and all potential sources of taxable income including scheduled reversals of deferred tax liabilities, tax-planning strategies, projected future taxable income and recent financial performance. The valuation allowance increased from $25.0 million at December 31, 2016 to $35.6 million at December 31, 2017. The valuation allowance at December 31, 2017 was related to foreign net operating loss carryforwards, foreign tax credit carryforwards, and certain foreign deferred tax assets. The Company intends to maintain these valuation allowances until sufficient evidence exists to support their reversal. At December 31, 2017, the Company had a net operating loss carryforward of $126.0 million related to its foreign tax filings and $0.1 million related to its U.S. state tax filings. Of the $126.0 million net operating loss carryforward, $95.4 million is subject to a valuation allowance. Depending on the tax rules of the tax jurisdictions, the losses can be carried forward indefinitely or for periods ranging from five to twenty years. The Company also has a foreign tax credit carryforward of $8.1 million subject to a valuation allowance of $8.1 million recorded as a result of the Tax Reform Act described below. At December 31, 2016, the Company had a net operating loss carryforward of $101.7 million related to its foreign tax filings and $0.5 million related to its U.S. state tax filings. Of the $101.7 million net operating loss carryforward, $79.9 million is subject to a valuation allowance. Depending on the tax rules of the tax jurisdictions, the losses can be carried forward indefinitely or for periods ranging from five to twenty years. The Company also had a foreign tax credit carryforward of $12.1 million, expiring in 2017 through 2025. As of December 31, 2017, the Company had unremitted earnings held in its foreign subsidiaries of approximately $74.1 million, of which the company has provided $1.6 million of tax on $15.7 million of earnings that are intended to be remitted. The Company did not recognize a tax liability for income taxes and foreign withholding taxes related to the unremitted earnings of its foreign operations because the Company intends to reinvest those earnings indefinitely, net of any allowable deductions. An estimate of these taxes; however, is not practicable. A tax liability will be recognized if and when the Company is no longer able to demonstrate that it plans to permanently reinvest unremitted earnings. As of December 31, 2016, the Company had unremitted earnings held in its foreign subsidiaries of approximately $72.7 million, of which the company has provided $3.3 million of tax on $15.6 million of earnings that are intended to be remitted. In 2016, the Company repatriated dividends from foreign operations to the United States. This resulted in additional book tax expense which will be offset by utilizing foreign tax credits. The Company did not recognize a deferred tax liability for U.S. income taxes and foreign withholding taxes related to the unremitted earnings of its foreign operations because the Company intends to reinvest those earnings indefinitely. If a distribution of these earnings were to be made, the Company might be subject to both foreign withholding taxes and U.S. income taxes, net of any allowable foreign tax credits or deductions. An estimate of these taxes; however, is not practicable. A deferred tax liability will be recognized if and when the Company is no longer able to demonstrate that it plans to permanently reinvest unremitted earnings. As of January 1, 2017, the Company had $1.0 million of unrecognized tax benefits. As of December 31, 2017, the Company had $0.7 million of unrecognized tax benefits of which, if recognized, would be recorded as a component of income tax expense. A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows:
In many cases the Company’s uncertain tax positions are related to tax years that remain subject to examination by the relevant taxable authorities. Years 2014 through 2016 are subject to examination by the state taxing authorities. The years 2014 and 2016 are subject to examination by the federal taxing authority. There are certain foreign jurisdictions that are subject to examination for years prior to 2014. The Company is currently under audit by some jurisdictions. It is likely that the examination phase of several of these audits will conclude in the next twelve months. No significant increases or decreases in unrecognized tax benefits are expected to occur by December 31, 2018. Estimated interest and penalties related to the underpayment of income taxes are classified as a component of the provision for income taxes in the Consolidated Statements of Comprehensive Income (Loss). Accrued interest and penalties are $0.1 million as of December 31, 2017. The “Tax Cuts and Jobs Act” was enacted in December 22, 2017. Certain changes of the 2017 Tax Reform Act to the U.S tax code include: permanently reducing the corporate tax rate from 35% to a flat 21% for tax years beginning after December 31, 2017. The Tax Act includes the Transition Tax ‘Toll Charge’ and two additions to the tax base erosion: the global intangible low-taxed income (“GILTI”) of U.S. shareholders of CFCs, and the base-erosion and anti-abuse tax (“BEAT”). The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. As a result of the reduction in the U.S. corporate income tax rate from 35% to 21% under the Tax Reform Act, the Company revalued its ending net deferred tax assets at December 31, 2017 and recognized a $14.2 million tax expense in the Company’s consolidated statement of income for the year ended December 31, 2017. As a result of the changes in the Tax Reform Act, the Company also reduced its deferred tax assets by $1.4 million. The Tax Reform Act provided for a one-time deemed mandatory repatriation (“Toll Tax”) of post-1986 undistributed foreign subsidiary earnings and profits (“E&P”) through the year ended December 31, 2017. The Company does not have undistributed foreign subsidiary E&P and therefore did not record a Toll Tax liability for the year ended December 31, 2017. While the Tax Reform Act provides for a territorial tax system, beginning in 2018, it includes two new U.S. tax base erosion provisions, the global intangible low-taxed income (“GILTI”) provisions and the base-erosion and anti-abuse tax (“BEAT”) provisions. The GILTI provisions require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The Company expects that it will be subject to incremental U.S. tax on GILTI income beginning in 2018, due to expense allocations required by the U.S. foreign tax credit rules. The Company has elected to account for GILTI tax in the period in which it is incurred, and therefore has not provided any deferred tax impacts of GILTI in its consolidated financial statements for the year ended December 31, 2017. The BEAT provisions in the Tax Reform Act eliminates the deduction of certain base-erosion payments made to related foreign corporations, and impose a minimum tax if greater than regular tax. The Company does not expect it will be subject to this tax and therefore has not included any tax impacts of BEAT in its consolidated financial statements for the year ended December 31, 2017. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Reform Act. The Company has recognized the provisional tax impacts related to the revaluation of deferred tax assets and liabilities, foreign earnings intended to be remitted, and the tax on foreign earnings intended to be remitted. The Company has included these amounts in its consolidated financial statements for the year ended December 31, 2017. The ultimate impact may differ from these provisional amounts, possibly materially, due to, among other things, additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued, and actions the Company may take as a result of the Tax Reform Act. The accounting is expected to be complete when the 2017 U.S. corporate income tax return is filed in 2018. |
Segment Information |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | In the fourth quarter of 2016, the Company restructured its operating segments. Given the significant growth of the Company's Leadership Consulting service line, the Company's chief operating decision maker began to regularly assess performance and make resource allocation decisions separately for Executive Search and Leadership Consulting. Therefore, the Company now reports Executive Search and Leadership Consulting as separate operating segments. Previously reported operating segment results for the year ended December 31, 2015 have been recast to conform to the new operating segment structure. The Company currently operates its executive search business in the Americas; Europe (which includes Africa); and Asia Pacific (which includes the Middle East) and operates its leadership consulting and culture shaping businesses as separate segments. For segment purposes, reimbursements of out-of-pocket expenses classified as revenue and other operating income are reported separately and, therefore, are not included in the results of each segment. The Company believes that analyzing trends in revenue before reimbursements (net revenue), analyzing operating expenses as a percentage of net revenue, and analyzing operating income (loss) more appropriately reflects its core operations. The revenue, operating income, depreciation and amortization, and capital expenditures, by segment, are as follows:
Identifiable assets, and goodwill and other intangible assets, net, by segment, are as follows:
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Guarantees |
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Dec. 31, 2017 | |
Guarantees [Abstract] | |
Guarantees | Guarantees The Company has issued cash collateralized bank guarantees and letter of credit backed bank guarantees supporting certain obligations, primarily the payment of office lease obligations and business license requirements for certain of its subsidiaries in Europe and Asia Pacific. The bank guarantees were made to secure the respective agreements and are for the terms of the agreements, which extend through 2019. For each bank guarantee issued, the Company would have to perform under the guarantee if the subsidiary defaults on a lease payment. The maximum amount of undiscounted payments the Company would be required to make in the event of default on all outstanding bank guarantees is approximately $2.6 million as of December 31, 2017. The Company has not accrued for these arrangements as no event of default exists or is expected to exist. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Operating Leases The Company leases office space in 49 cities in 24 countries. The terms of these office-related leases provide that the Company pay base rent and a share of operating expenses and real estate taxes in excess of defined amounts. These leases expire at various dates through 2026. The Company also leases certain computer equipment and cars, the terms of which are accounted for as operating leases. Rent expense, which includes the base rent, maintenance costs, operating expenses and real estate taxes, and the costs of equipment leases for the years ended December 31, 2017, 2016, and 2015 was $32.2 million, $30.8 million, and $29.6 million, respectively. Minimum future operating lease payments due in each of the next five years and thereafter are as follows:
The aggregate minimum future payments on office leases are $145.1 million. The Company has contractual arrangements to receive aggregate sublease income of $0.6 million related to certain leases that expire at various dates through 2019. This sublease income primarily relates to properties that were part of prior office consolidations and closings. Certain leases provide for renewal options and payments of real estate taxes and other occupancy costs. In addition, certain leases contain rent escalation clauses that require additional rental amounts in later years of the term. Rent expense for leases with rent escalation clauses is recognized on a straight-line basis over the minimum lease term. The Company has an obligation at the end of the lease term to return certain offices to the landlord in its original condition, which is recorded at fair value at the time the liability is incurred. The Company had $2.9 million and $2.6 million of asset retirement obligations as of December 31, 2017 and 2016, respectively. In 2017, the Company began vacating three offices as a result of the restructuring plan to reduce overall costs and improve efficiencies in the Company's operations. Litigation The Company has contingent liabilities from various pending claims and litigation matters arising in the ordinary course of the Company’s business, some of which involve claims for damages that are substantial in amount. Some of these matters are covered by insurance. Based upon information currently available, the Company believes the ultimate resolution of such claims and litigation will not have a material adverse effect on its financial condition, results of operations or liquidity. UK Employee Benefits Trust On March 31, 2017, the Company reached a settlement with Her Majesty’s Revenue and Customs (“HMRC”) in the United Kingdom regarding HMRC’s challenge of the tax treatment of certain of the Company’s contributions in the United Kingdom to an Employee Benefits Trust between 2002 and 2008. HMRC alleged that the contributions should have been subject to Pay As You Earn tax and Class 1 National Insurance Contributions in the United Kingdom. In connection with the settlement, the Company agreed to pay approximately £5.4 million (equivalent to $6.8 million on the settlement date) related to Pay as You Earn tax, Class 1 National Insurance Contributions, inheritance tax and interest. Concurrently with the HMRC settlement, the Company also reached an agreement with the beneficiaries under the Employee Benefits Trust for the reimbursement of approximately £2.3 million (equivalent to $2.9 million on the settlement date) beneficiary-owed Pay as You Earn tax and Class 1 National Insurance Contributions. The Company has recorded $1.5 million related to the Pay as You Earn tax and Class 1 National Insurance Contributions and the respective beneficiary reimbursements as a component of Salaries and employee benefits in the Condensed Consolidated Statement of Comprehensive Income (Loss). Inheritance tax and interest expense of $2.4 million incurred as a result of the settlement is recorded as a component of Other, net in the Condensed Consolidated Statement of Comprehensive Income (Loss). During the three months ended June 30, 2017, the Company made payments of approximately £5.4 million (equivalent to $6.9 million on the payment date) related to the Pay as You Earn tax, and received reimbursement of £2.0 million (equivalent to $2.6 million on the reimbursement date) from the beneficiaries under the Employee Benefits Trust. Approximately £0.3 million (equivalent to $0.4 million) of reimbursements related to beneficiary-owed Pay as You Earn tax is outstanding at December 31, 2017. |
Subsequent Event |
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Dec. 31, 2017 | |||||
Subsequent Event [Line Items] | |||||
Subsequent Events |
On January 4, 2018, the Company acquired Amrop A/S ("Amrop"), a Denmark-based provider of executive search, succession planning and coaching services for 24.3 million Danish Krones (equivalent to $3.9 million on the acquisition date) of initial consideration. The former owners of Amrop are expected to receive additional cash consideration of 28.0 million Danish Krones (equivalent to $4.5 million on the acquisition date) based on fee revenue generated by the business during the two-year period following the completion of the acquisition. However, the actual amount of additional cash consideration cannot be determined at this time. The transaction was financed with cash. |
Summary of Significant Accounting Policies (Policies) |
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Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of three months or less to be cash equivalents. |
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Concentration of Risk | Concentration of Risk The Company is potentially exposed to concentrations of risk associated with its accounts receivable. However, this risk is limited due to the Company’s large number of clients and their dispersion across many different industries and geographies. At December 31, 2017 and 2016, the Company had no significant concentrations of risk. |
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Accounts Receivable | Accounts Receivable The Company’s accounts receivable consist of trade receivables. The allowance for doubtful accounts is developed based upon several factors including the age of the Company’s accounts receivable, historical write-off experience and specific account analysis. These factors may change over time, impacting the allowance level. |
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Fair Value of Financial Instruments | Fair Value of Financial Instruments Cash equivalents are stated at cost, which approximates fair market value. The carrying value for receivables from clients, accounts payable, deferred revenue and other accrued liabilities reasonably approximate fair market value due to the nature of the financial instruments and the short term nature of the items. |
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Property and Equipment | Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful life of the asset or, for leasehold improvements, the shorter of the lease term or the estimated useful life of the asset, as follows:
Leasehold improvements are depreciated over the lesser of the lease term or life of the asset improvement, which typically range from three to ten years. Depreciation is calculated for tax purposes using accelerated methods, where applicable. |
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Long-lived Assets | Long-lived Assets The Company reviews its long-lived assets, including property and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge, equal to the amount by which the carrying amount of the asset exceeds the fair value of the asset, is recognized. |
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Investments | Investments The Company’s investments consist primarily of available-for-sale investments within the U.S. non-qualified deferred compensation plan (the “Plan”). Available-for-sale investments are reported at fair value with changes in unrealized gains (losses) recorded as a separate component of Accumulated other comprehensive income in the Consolidated Balance Sheets until realized. Realized gains (losses) resulting from an employee’s termination from the Plan are recorded as a non-operating expense in Other, net in the Consolidated Statements of Comprehensive Income (Loss). |
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Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill represents the difference between the purchase price of acquired companies and the related fair value of the net assets acquired, which is accounted for by the acquisition method of accounting. Other intangible assets include client relationships and employee non-compete agreements. The Company performs assessments of the carrying value of goodwill at least annually and of its goodwill and other intangible assets whenever events occur or circumstances indicate that a carrying amount of these assets may not be recoverable. These circumstances include a significant change in business climate, attrition of key personnel, changes in financial condition or results of operations, a prolonged decline in the Company’s stock price and market capitalization, competition, and other factors. The goodwill impairment test compares the fair value of a reporting unit to its carrying amount, including goodwill. The Company operates five reporting units: Americas; Europe, which includes Africa; Asia Pacific, which includes the Middle East; Leadership Consulting; and Culture Shaping. The goodwill impairment test is completed by comparing the fair value of a reporting unit with its carrying amount. The fair value of each of the Company’s reporting units is determined using a discounted cash flow methodology. An impairment charge is recognized for the amount by which the carrying value of the reporting unit exceeds its fair value, however, the loss recognized is not to exceed the total amount of goodwill allocated to that reporting unit. The other intangible asset impairment review compares the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge, equal to the amount by which the carrying amount of the asset exceeds the fair value, is recognized. Other intangible assets acquired are amortized either using the straight-line method over their estimated useful lives or based on the projected cash flow associated with the respective intangible assets. |
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Costs Associated with Exit or Disposal Activities or Restructurings, Policy [Policy Text Block] | Restructuring Charges The Company accounts for restructuring charges by recognizing a liability at fair value when the costs are incurred. |
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Revenue Recognition | Revenue Recognition Revenue before reimbursements of out-of-pocket expenses (“net revenue”) consists of retainers and indirect expenses billed to clients. For each assignment, the Company and its client enter into a contract that outlines the general terms and conditions of the assignment. Typically, the Company is paid a retainer for its executive search services equal to approximately one-third of the estimated first year compensation for the position to be filled. In addition, generally, if the actual compensation of a placed candidate exceeds the estimated compensation, the Company often is authorized to bill the client for one-third of the excess. Indirect expenses are calculated as a percentage of the retainer with certain dollar limits per search. The Company generally bills its clients for its retainer and indirect expenses in one-third increments over a three-month period commencing in the month of a client’s acceptance of the contract. Net revenue is recognized when earned and realizable and therefore when the following criteria have been met: (a) persuasive evidence of an arrangement exists, (b) services have been rendered, (c) the fee to our client is fixed or determinable, and (d) collectability is reasonably assured. Taxes collected from clients and remitted to governmental authorities are presented on a net basis. Typically, net revenue from standard executive search engagements is recognized over the expected average period of performance, in proportion to the estimated personnel time incurred to fulfill our obligations under the arrangements. Net revenue in excess of the retainer, resulting from actual compensation of the placed candidate exceeding the estimated compensation, is recognized upon completion of the executive search when the amount of the additional fee is known. Net revenue associated with culture shaping services is recognized proportionally as services are performed. Net revenue associated with licenses to use our culture shaping proprietary materials is typically recognized over the term of the arrangement. Depending on the terms of that agreement, net revenue from certain leadership consulting and non-standard executive search engagements is either recognized proportionally as services are performed or in accordance with the completion of the engagement deliverables. |
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Reimbursements | Reimbursements The Company incurs certain out-of-pocket expenses that are reimbursed by its clients, which are accounted for as revenue and expense in its Consolidated Statements of Comprehensive Income (Loss). |
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Salaries and Employee Benefits | Salaries and Employee Benefits Salaries and employee benefits consist of compensation and benefits paid to consultants, executive officers, and administrative and support personnel, of which the most significant elements are salaries and annual performance-related bonuses. Other items in this category are expenses related to sign-on bonuses, forgivable employee loans and minimum guaranteed bonuses (often incurred in connection with the hiring of new consultants), restricted stock unit and performance share unit amortization, payroll taxes, profit sharing and retirement benefits, and employee insurance benefits. Salaries and employee benefits are recognized on an accrual basis. Certain sign-on bonuses, retention awards, and minimum guaranteed compensation are capitalized and amortized in accordance with the terms of the respective agreements. A portion of the Company’s consultants’ and management cash bonuses are deferred and paid over a three-year vesting period. The portion of the bonus is approximately 15% depending on the employee’s level or position. The compensation expense related to the amounts being deferred is recognized on a graded vesting attribution method over the requisite service period. This service period begins on January 1 of the respective fiscal year and continues through the deferral date, which coincides with the Company’s bonus payments in the first quarter of the following year, and for an additional three year vesting period. The deferrals are recorded in Accrued salaries and employee benefits within both Current liabilities and Non-current liabilities in the Consolidated Balance Sheets. |
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Income Taxes | Income Taxes Deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities, applying enacted statutory tax rates in effect for the year in which the tax differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. |
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Earnings per Common Share | Earnings per Common Share Basic earnings per common share is computed by dividing net income by weighted average common shares outstanding for the year. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted. Common equivalent shares are excluded from the determination of diluted earnings per share in periods in which they have an anti-dilutive effect. The following table sets forth the computation of basic and diluted earnings (loss) per share:
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Translation of Foreign Currencies | Translation of Foreign Currencies The Company generally designates the local currency for all its subsidiaries as the functional currency. The Company translates the assets and liabilities of its subsidiaries into U.S. dollars at the current rate of exchange prevailing at the balance sheet date. Revenue and expenses are translated at a monthly average exchange rate for the period. Translation adjustments are reported as a component of Accumulated other comprehensive income. |
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Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash The Company has lease agreements and business licenses with terms that require the Company to restrict cash through the termination dates of the agreements, which extend through 2019. During 2016, the Company paid certain key executives of Senn Delaney a $6.5 million retention bonus out of restricted cash for remaining with the Company for three years subsequent to the acquisition. As of December 31, 2017 and 2016, the total restricted cash was $0.6 million and $0.6 million, respectively. Current and non-current restricted cash is included in Other current assets and Other non-current assets, respectively, on the Consolidated Balance Sheet. |
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Recently Issued Financial Accounting Standards | Recently Issued Financial Accounting Standards In May 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-09, Compensation - Stock Compensation, Scope of Modification Accounting, which is intended to provide clarity and reduce both diversity in practice, cost and complexity when implementing a change in the terms or conditions of a share-based payment award. ASU 2017-09 requires that an entity should account for the effects of a modification unless the fair value, vesting conditions, and whether the award is classified as a liability instrument or an equity instrument remain unchanged in the modification. ASU 2017-09 is effective for interim and annual periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. The impact of this accounting guidance will be dependent on future modification events including the number of awards modified. In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost, which is intended to improve the consistency, transparency and usefulness of net benefit cost disclosures. ASU 2017-07 requires that an employer report the service cost component of net benefit cost in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. Additionally, the other components of net benefit costs are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. ASU 2017-07 is effective for interim and annual periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. The impact of this accounting guidance will not be material to the Company's financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash, which requires that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore amounts generally described as restricted cash should be included with cash and cash equivalents when reconciling the beginning of period and end of period total amounts shown on the statement of cash flows. The Company currently does not include restricted cash amounts in the beginning and ending cash amounts and will change the presentation of the cash flow statement to include restricted cash in the beginning and ending cash totals. The standard is effective for annual reporting periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. If the Company had adopted the guidance as of December 31, 2017, the beginning and ending balance of cash, cash equivalents and restricted cash for the year ended December 31, 2017 would have each increased by $0.6 million in the Condensed Consolidated Statement of Cash Flows. In August 2016, the Financial Accounting Standards Board ("FASB") issued accounting Standards Update ("ASU") No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, which is intended to reduce diversity in practice as to how certain cash receipts and cash payments should be presented and classified. The standard is effective for interim and annual reporting periods beginning after December 15, 2017 with early adoption permitted. The Company will adopt this guidance effective January 1, 2018. The Company has evaluated the standard and noted the guidance for contingent consideration payments made after a business combination are applicable to the Condensed Consolidated Statements of Cash Flows. The Company currently classifies all contingent consideration payments as financing activities. The impact of this change is not expected to be significant to the classification of these activities on the Consolidated Statement of Cash Flows. In February 2016, the FASB issued ASU No. 2016-02, Leases, intended to improve financial reporting about leasing transactions. The new guidance will require entities that lease assets to recognize on their balance sheets the assets and liabilities for the rights and obligations created by those leases and to disclose key information about the leasing arrangements. ASU 2016-02 is effective for interim and annual periods beginning after December 15, 2018 with early adoption permitted. The guidance requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the impact of this accounting guidance. The effect is not known or reasonably estimable at this time. In January 2016, the FASB issued ASU 2016-01, Financial Instruments: Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments including the recognition of unrealized changes in fair value within net income. The standard is effective for annual reporting periods beginning after December 15, 2017. The Company will adopt this guidance effective January 1, 2018. Upon adoption, the Company will reclassify approximately $6.1 million of unrecognized gains on the Company's available for sale securities, which are currently included in accumulated other comprehensive income, to retained earnings. Future holding gains on the Company's available for sale securities will be recorded in earnings. During the year ended December 31, 2017, the Company had holding gains of approximately $2.7 million prior to the reclassification of realized gains to earnings, on its available for sale securities, which would have been recognized in earnings under ASU 2016-01. The amount of future holding gains or losses is dependent upon market conditions and may substantially fluctuate between periods. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers. The ASU requires that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for these goods or services. The guidance is effective for interim and annual reporting periods beginning after December 15, 2017. The guidance permits the use of either of the following transition methods: (i) a full retrospective method reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or (ii) a retrospective method with the cumulative effect upon initial adoption recognized at the date of initial application (modified retrospective). The Company will adopt the guidance on January 1, 2018 and will apply the modified retrospective method, which involves recognizing the cumulative effect of applying the guidance at the date of initial application with no restatement of the comparative periods presented. The Company continues to perform its evaluation of ASU No. 2014-09 and has made certain assessments regarding each of its primary revenue streams. Executive Search - The Company’s executive search engagements involve the receipt of a retainer that is equal to approximately one-third of the estimated first year compensation for the position to be filled. If actual compensation of a placed candidate exceeds the original compensation estimate, the Company is often authorized to bill the client for one-third of the excess compensation. The Company refers to this excess compensation billing as uptick revenue. Currently, the Company recognizes uptick revenue upon the completion of the executive search at the point the uptick revenue becomes fixed and determinable. Under ASU No. 2014-09, uptick revenue is considered variable consideration and the Company will be required to estimate this revenue at contract inception. The Company has developed an estimation process utilizing the expected value method, incorporating historical uptick revenue realized in the Company’s geographic regions and industry practices, which will result in an initial recording of a contract’s uptick revenue that is probable not to result in a significant reversal of cumulative revenue recognized when the actual amount of uptick revenue for that contract is known. Estimates of uptick revenue will be recognized using the same over time revenue recognition model the Company currently utilizes to recognize retainer revenue, and differences between the estimated and actual amount of uptick revenue will be recorded when known. Typically, revenue from executive search engagements is recognized over the expected average period of performance, in proportion to the estimated personnel time incurred to fulfill our obligations under the executive search arrangement. The Company is currently quantifying the required transition adjustment for the Executive Search revenue streams. Leadership Consulting - The Company does not anticipate a significant change in revenue recognition as it relates to its leadership consulting engagements. Substantially all of the Company’s engagements will continue to be recognized over time although the identification of the performance obligations within any given engagement may differ from the Company’s current revenue recognition methodology. Culture Shaping - The Company does not anticipate a significant change in revenue recognition as it relates to its culture shaping consulting engagements. Substantially all of the Company’s consulting engagements will continue to be recognized over time although the identification of the performance obligations within any given engagement may differ from the Company’s current revenue recognition methodology. The Company has concluded that licenses to use our proprietary culture shaping materials, which the Company refers to as enterprise agreements, generally contain a material right resulting in the recognition of this type of revenue over a longer period of time. The Company is currently quantifying the required transition adjustment. Recently Adopted Financial Accounting Standards In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other, which eliminates Step 2 from the goodwill impairment test. Instead, under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The Board also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity is required to disclose the amount of goodwill allocated to each reporting unit with a zero or negative carrying amount of net assets. The Company early adopted ASU 2017-04, during the three months ended June 30, 2017. The Company concluded that ASU 2017-04 is preferable to the current guidance included in ASC 350 due to the simplified process of subsequently measuring goodwill. |
Summary of Significant Accounting Policies (Tables) |
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Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the computation of basic and diluted earnings (loss) per share:
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Summary of Estimated Useful Life of Property and Equipment | Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful life of the asset or, for leasehold improvements, the shorter of the lease term or the estimated useful life of the asset, as follows:
Leasehold improvements are depreciated over the lesser of the lease term or life of the asset improvement, which typically range from three to ten years. Depreciation is calculated for tax purposes using accelerated methods, where applicable. |
Allowance for Doubtful Accounts (Tables) |
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Summary of Allowance for Doubtful Accounts | The activity of the allowance for doubtful accounts for the years ended:
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Property and Equipment, net (Tables) |
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Components of Company's Property and Equipment | The components of the Company’s property and equipment are as follows:
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Fair Value Measurements (Tables) |
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Reconciliation of Beginning and Ending Balance of Level 3 Assets and Liabilities | The following table provides a reconciliation of the beginning and ending balance of Level 3 assets and liabilities for the year ended December 31, 2017.
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Goodwill and Other Intangible Assets (Tables) |
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Goodwill by Segment [Table Text Block] | The Company's goodwill by segment is as follows:
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Changes in Carrying Amount of Goodwill by Segment | Changes in the carrying amount of goodwill by segment for the years ended December 31, 2017, 2016, and 2015 were as follows:
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Carrying Amount of Amortizable Intangible Assets and Related Accumulated Amortization | The Company’s other intangible assets, net by segment, are as follows:
As discussed above, the Culture Shaping business was impacted by the transition of senior-level personnel, primarily due to planned retirements, and the Company experienced lower than expected consultant productivity. The Company has also experienced lengthening sales cycles and decision processes within target client organizations. Due to the impact of these events on revenue and earnings when compared to actual and forecasted results, and the impact to the revenue and earnings inputs utilized in the fair value assessment of the intangible assets, the Company identified a triggering event for its Culture Shaping intangible assets and performed an impairment evaluation during the three months ended June 30, 2017. As noted above, due to the uncertainty around the pace and timing of growth in profitability in the Leadership Consulting reporting unit as the Company invests in talent and service offerings, the Company identified a triggering event for its Leadership Consulting intangible assets and performed an impairment evaluation as of October 31, 2017. These analyses were conducted in accordance with accounting guidance on fair value measurements taking into consideration Level 3 inputs, primarily consisting of discounted cash flow and replacement cost methodologies. Based on these evaluations, the Company recorded an impairment charge related to its Culture Shaping client relationships, trade name, software and non-compete intangible assets of $9.9 million during the year ended December 31, 2017. The Company also recorded an impairment charge related to its Leadership Consulting client relationships, software and non-compete intangible assets of $4.6 million during the year ended December 31, 2017. These impairment charges are recorded within Impairment charges in the Condensed Consolidated Statement of Comprehensive Income (Loss) for the year ended December 31, 2017. The impairments were non-cash in nature and did not affect our current liquidity, cash flows, borrowing capability or operations; nor did it impact the debt covenants under our credit agreement. The carrying amount of amortizable intangible assets and the related accumulated amortization were as follows:
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Goodwill and Other Intangible Assets Schedule of Goodwill (Tables) |
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Goodwill [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill [Table Text Block] | Changes in the carrying amount of goodwill by segment for the years ended December 31, 2017, 2016, and 2015 were as follows:
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Goodwill and Other Intangible Assets Schedule of Finite Lived Intangible Assets by Segment (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Finite Lived Intangible Assets By Segment [Table Text Block] | The Company’s other intangible assets, net by segment, are as follows:
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Other Non-Current Liabilities (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Other Non-Current Liabilities | The components of other non-current liabilities are as follows:
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Other Non-Current Liabilities Other Current Liabilities (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Current Liabilities [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Current Liabilities [Table Text Block] | The components of other current liabilities are as follows:
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Pension Plan and Life Insurance Contract (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconcile Benefit Obligation for Pension Plan |
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Benefit Obligation Amounts Recognized in Consolidated Balance Sheets | The benefit obligation amounts recognized in the Consolidated Balance Sheets are as follows:
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Components of Assumptions Used to Determine Net Periodic Benefit Cost | The components of and assumptions used to determine the net periodic benefit cost are as follows:
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Assumptions to Determine Company's Benefit Obligation | Assumptions to determine the Company’s benefit obligation are as follows:
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Summary of Benefits Expected to Be Paid in Each of Next Five Years | The benefits expected to be paid in each of the next five years, and in the aggregate for the five years thereafter are as follows:
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Stock-Based Compensation (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Information with Respect to Stock-based Compensation | A summary of information with respect to stock-based compensation is as follows:
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Restricted Stock Unit Activity | Restricted stock unit activity as of December 31, 2017, 2016, and 2015:
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Performance Stock Unit Activity | Performance share unit activity as of December 31, 2017, 2016, and 2015:
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Changes in Accumulated Other Comprehensive Income (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Accumulated Other Comprehensive Income ("AOCI") by Component | The changes in Accumulated other comprehensive income (“AOCI”) by component for the year ended December 31, 2017 are summarized below:
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Restructuring Schedule of Restructuring Charges by Segment (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Charges by Segment [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Charges by Segment [Table Text Block] | hese charges consist of $13.1 million of employee-related costs, including severance associated with reductions in our workforce of 251 employees globally, $2.3 million of other professional and consulting fees and $0.3 million of expenses associated with closing three office locations. Restructuring charges by operating segment for the year ended December 31, 2017 are as follows:
Th |
Restructuring Schedule of Restructuring Charges and Related Cash Payments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Charges and Related Cash Payments [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Charges and Related Cash Payments [Table Text Block] | accrued restructuring charges at December 31, 2017 primarily consists of employee-related costs that require cash payments based on individual severance agreements, real estate leases that require cash payments through the lease terms reduced by sublease income and other professional fees. These accruals are included within Other current liabilities and Other non-current liabilities in the Consolidated Balance Sheets at December 31, 2017. The table below outlines the restructuring charges along with related cash payments for the year ended December 31, 2017:
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Income Taxes (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sources of Income (Loss) before Income Taxes | The sources of income (loss) before income taxes are as follows:
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Provision for (Benefit from) Income Taxes | The provision for (benefit from) income taxes are as follows:
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Reconciliation of Provision for (Benefit from) Income Taxes | A reconciliation of the provision for income taxes to income taxes at the statutory U.S. federal income tax rate of 35% is as follows:
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Summary of Deferred Tax Assets and Liabilities | The deferred tax assets and liabilities are attributable to the following components:
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Reconciliation of Amounts of Gross Unrecognized Tax Benefits | A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows:
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Segment Information (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue, Operating Income, Depreciation and Amortization, and Capital Expenditures, by Segment | The revenue, operating income, depreciation and amortization, and capital expenditures, by segment, are as follows:
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Identifiable Assets, Goodwill and Other Intangible Assets, Net, by Segment | Identifiable assets, and goodwill and other intangible assets, net, by segment, are as follows:
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Commitments and Contingencies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Summary of Minimum Future Office Space and Equipment Lease Payments Due | Minimum future operating lease payments due in each of the next five years and thereafter are as follows:
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Summary of Significant Accounting Policies Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
12 Months Ended | ||
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Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Net Income (Loss) Attributable to Parent | $ (48,635) | $ 15,413 | $ 17,132 |
Weighted Average Number of Shares Outstanding, Basic | 18,735 | 18,540 | 18,334 |
Weighted Average Number of Shares Outstanding, Diluted | 18,735 | 19,038 | 18,715 |
Earnings Per Share, Basic | $ (2.60) | $ 0.83 | $ 0.93 |
Earnings Per Share, Diluted | $ (2.60) | $ 0.81 | $ 0.92 |
Restricted Stock Units (RSUs) [Member] | |||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Weighted Average Number of Shares Outstanding, Diluted | 0 | 347 | 234 |
Performance Shares [Member] | |||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Weighted Average Number of Shares Outstanding, Diluted | 0 | 151 | 147 |
Summary of Significant Accounting Policies Restricted Cash (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Increase (Decrease) in Restricted Cash | $ 3 | $ 7,228 | $ 0 |
Restricted Cash and Cash Equivalents | $ 600 | 600 | |
Senn Delaney Leadership Consulting Group [Member] | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Increase (Decrease) in Restricted Cash | $ 6,500 |
Allowance for Doubtful Accounts - Summary of Allowance for Doubtful Accounts (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Beginning balance | $ 2,575 | $ 5,376 | $ 3,942 |
Provision charged to income | 963 | 1,407 | 2,772 |
Write-offs | (1,134) | (4,106) | (1,140) |
Foreign currency translation | (130) | 102 | 198 |
Ending balance | $ 2,534 | $ 2,575 | $ 5,376 |
Property and Equipment, Net - Components of Company's Property and Equipment (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 94,248 | $ 89,754 |
Accumulated depreciation | (54,734) | (54,655) |
Property and equipment, net | 39,514 | 35,099 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 48,216 | 42,891 |
Office Furniture, Fixtures and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 17,732 | 16,677 |
Computer Equipment and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 28,300 | $ 30,186 |
Property and Equipment, Net - Additional Information (Detail) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 10.4 | $ 9.4 | $ 8.8 |
Fair Value Measurements - Reconciliation of Beginning and Ending Balance of Level 3 Assets and Liabilities (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
| |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Acquisition earnout accruals, beginning balance | $ (10,991) |
Acquisition earnout accruals, ending balance | (7,213) |
Fair Value, Inputs, Level 3 [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Acquisition earnout accruals, beginning balance | (10,991) |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Business Combination, Acquisition Earnout Adjustment, Fair Value | 705 |
Earnout accretion | (1,038) |
Earnout payments | 4,557 |
Foreign currency translation | (446) |
Acquisition earnout accruals, ending balance | $ (7,213) |
Investments - Additional Information (Detail) - U.S. Non-Qualified Deferred Compensation Plan [Member] - USD ($) $ in Millions |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Aggregate cost basis for investments | $ 14.6 | $ 13.3 |
Fair Value, Inputs, Level 1 [Member] | ||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Long-term Investments | $ 21.3 | $ 17.3 |
Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2017 |
Jun. 30, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Business Acquisition [Line Items] | ||||||
Accretion expense | $ 1,038 | $ 635 | $ 1,294 | |||
Goodwill | 118,892 | 151,844 | 131,122 | $ 122,176 | ||
Goodwill acquired | $ 10,745 | |||||
Philosophy IB [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill acquired | $ 364 | 2,357 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Business Combination, Acquisition Earnout Adjustment, Fair Value | $ 700 | |||||
JCA [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill acquired | 15,769 | |||||
Decision Strategies [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill acquired | $ 5,673 | |||||
Co Company [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Payment of contingent consideration | $ 2,300 |
Goodwill and Other Intangible Assets - Summary of Other Intangible Assets Net by Segment (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 2,158 | $ 20,690 |
Executive Search [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 2,158 | 3,565 |
Executive Search [Member] | Americas [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 252 | 501 |
Executive Search [Member] | Europe [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 1,799 | 2,937 |
Executive Search [Member] | Asia Pacific [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 107 | 127 |
Leadership Consulting [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 0 | 6,223 |
Culture Shaping [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 0 | $ 10,902 |
Goodwill and Other Intangible Assets - Intangible Assets- Additional Information (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Finite-Lived Intangible Assets [Line Items] | |||
Net Carrying Amount | $ 2,158 | $ 20,690 | |
Intangible asset amortization expense, excluding impairment charge | 4,400 | $ 7,100 | $ 4,900 |
Estimated Intangible asset amortization expense 2016 | 968 | ||
Estimated Intangible asset amortization expense 2017 | 507 | ||
Estimated Intangible asset amortization expense 2018 | 294 | ||
Estimated Intangible asset amortization expense 2019 | 194 | ||
Estimated Intangible asset amortization expense 2020 | 129 | ||
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | $ 66 |
Other Non-Current Liabilities - Components of Other Non-Current Liabilities (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Other Current Liabilities [Line Items] | ||
Restructuring Charges | $ 13,023 | $ 0 |
Other Accrued Liabilities, Current | 27,323 | 24,133 |
Other current liabilities | 40,346 | 24,133 |
Premise related costs | 18,360 | 18,188 |
Accrued earnout payments | 3,076 | 8,518 |
Restructuring Reserve, Noncurrent | 10 | 0 |
Other | 2,151 | 1,582 |
Total other non-current liabilities | $ 23,597 | $ 28,288 |
Line of Credit - Additional Information (Detail) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||
---|---|---|---|---|---|---|---|
Mar. 31, 2018 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Jun. 30, 2015 |
|
Line of Credit Facility [Line Items] | |||||||
Long-term Line of Credit, Noncurrent | $ 0 | ||||||
Proceeds from Lines of Credit | $ 40,000 | $ 40,000 | $ 0 | $ 0 | |||
Repayments of Long-term Debt | $ 25,000 | $ 15,000 | |||||
Senior Unsecured Revolving Line Of Credit Member [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Borrowing amount under term loan facility | $ 100,000 | ||||||
Sublimit for letters of credit | 25,000 | ||||||
Line of credit facility expansion feature | $ 50,000 | ||||||
Subsequent Event [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Proceeds from Lines of Credit | $ 20,000 |
Pension Plan and Life Insurance Contract - Reconcile Benefit Obligation for Pension Plan (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |||
Benefit obligation at January 1, | $ 22,128 | $ 22,388 | |
Interest cost | 362 | 453 | $ 436 |
Actuarial (gain) loss | (371) | 1,178 | |
Benefits paid | (1,453) | (1,198) | |
Cumulative translation adjustment | 3,220 | (693) | |
Benefit obligation at December 31, | 23,886 | 22,128 | $ 22,388 |
Pension and Other Postretirement Defined Benefit Plans, Liabilities | $ 23,886 | $ 22,128 |
Pension Plan and Life Insurance Contract - Benefit Obligation Amounts Recognized in Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Amounts That Yet Not Amortized From Accumulated Other Comprehensive Income Loss In Next Fiscal Year | $ 3,700 | $ 3,600 |
Noncurrent liabilities | 44,802 | 39,039 |
Total | 23,886 | 22,128 |
Assets designated for retirement and pension plans | 18,590 | 16,979 |
German Pension [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Current liabilities | 1,461 | 1,281 |
Noncurrent liabilities | 22,425 | 20,847 |
Total | $ 23,886 | $ 22,128 |
Pension Plan and Life Insurance Contract - Additional Information (Detail) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Compensation and Retirement Disclosure [Abstract] | ||
Amount not recognized as a component of net periodic benefit cost | $ 3,700 | $ 3,600 |
Fair value of pension benefits | 18,590 | $ 16,979 |
Expected contribution to be paid into plan | $ 1,461 |
Pension Plan and Life Insurance Contract - Components of Assumptions Used to Determine Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Net period benefit cost: | |||
Interest cost | $ 362 | $ 453 | $ 436 |
Amortization of net loss | 111 | 17 | 72 |
Net periodic benefit cost | $ 473 | $ 470 | $ 508 |
Weighted average assumptions | |||
Discount rate | 1.49% | 2.15% | 1.82% |
Rate of compensation increase | 0.00% | 0.00% | 1.75% |
Pension Plan and Life Insurance Contract - Assumptions to Determine Company's Benefit Obligation (Detail) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Compensation and Retirement Disclosure [Abstract] | |||
Discount rate | 1.64% | 1.53% | 2.15% |
Rate of compensation increase | 0.00% | 0.00% | 0.00% |
Measurement Date | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Pension Plan and Life Insurance Contract - Summary of Benefits Expected to Be Paid in Each of Next Five Years (Detail) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Compensation and Retirement Disclosure [Abstract] | |
2018 | $ 1,461 |
2019 | 1,451 |
2020 | 1,437 |
2021 | 1,421 |
2022 | 1,401 |
2023 through 2027 | $ 6,573 |
Stock-based Compensation - Summary of Information with Respect to Stock-Based Compensation (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Salaries and employee benefits | $ 4,597 | $ 5,830 | $ 4,616 |
Income tax benefit related to stock-based compensation included in net income | 1,948 | 2,523 | 1,856 |
General and Administrative Expense [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
General and administrative expenses | $ 338 | $ 563 | $ 450 |
Restructuring (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges | $ 15,666 | $ 0 | $ 0 |
Income Taxes - Sources of Income before Income Taxes (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||
United States | $ (28,577) | $ 30,696 | $ 26,550 |
Foreign | (841) | 7,070 | 5,004 |
Income (loss) before income taxes | $ (29,418) | $ 37,766 | $ 31,554 |
Income Taxes - Provision for (Benefit from) Income Taxes (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Current | |||
Federal | $ 10,107 | $ 12,261 | $ 8,598 |
State and local | 2,372 | 3,219 | 1,697 |
Foreign | 8,257 | 5,668 | 4,911 |
Current provision for income taxes | 20,736 | 21,148 | 15,206 |
Deferred | |||
Federal | 5,642 | 727 | (1,551) |
State and local | (2,951) | (370) | (180) |
Foreign | (4,210) | 848 | 947 |
Deferred provision (benefit) for income taxes | (1,519) | 1,205 | (784) |
Total provision for income taxes | $ 19,217 | $ 22,353 | $ 14,422 |
Income Taxes - Reconciliation of Provision for (Benefit from) Income Taxes (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | ||
Income tax provision (benefit) at the statutory U.S. federal rate | $ (10,296) | $ 13,218 | $ 11,044 |
State income tax provision (benefit), net of federal tax benefit | (593) | 1,904 | 1,272 |
Nondeductible expenses, net | 3,282 | 1,410 | 262 |
Foreign taxes (includes rate differential and changes in foreign valuation allowance) | 5,465 | (2,133) | 368 |
Establishment (release) of valuation allowance | (3,200) | 340 | 0 |
U.S. tax on foreign dividends | 0 | (5,898) | (1,120) |
Current/deferred true-up | 567 | 1,226 | 241 |
Effective Income Tax Reconciliation, Tax Reform | 23,732 | 0 | 0 |
Other, net | 260 | 490 | 115 |
Total provision for income taxes | $ 19,217 | $ 22,353 | $ 14,422 |
Income Taxes - Reconciliation of Amounts of Gross Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Unrecognized Tax Benefits Reconciliation [Roll Forward] | |||
Gross unrecognized tax benefits at January 1, | $ 1,038 | $ 130 | $ 143 |
Gross increases for tax positions of prior years | 167 | 2,146 | 22 |
Gross decreases for tax positions of prior years | 0 | (4) | (15) |
Settlements | (465) | (1,234) | (20) |
Lapse of statute of limitations | 0 | 0 | 0 |
Gross unrecognized tax benefits at December 31, | $ 740 | $ 1,038 | $ 130 |
Guarantees - Additional Information (Detail) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
| |
Guarantees [Abstract] | |
Extend termination dates of the leases | extend through 2019 |
Maximum undiscounted payments under outstanding guarantees | $ 2.6 |
Commitments and Contingencies - Additional Information (Detail) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
|
Dec. 31, 2015
USD ($)
|
|
Operating Leased Assets [Line Items] | |||
Number of cities in which office spaces leased | 49 | ||
Lease expiration period description | Through 2026 | ||
Number of countries in which office spaces leased | 24 | ||
Rent expense, costs of equipment leases and maintenance costs | $ 32,200 | $ 30,800 | $ 29,600 |
Aggregate minimum future payments on office leases | $ 148,065 | ||
Sublease expiration period | Through 2019 | ||
Asset retirement obligation | $ 2,900 | $ 2,600 | |
Office Leases [Member] | |||
Operating Leased Assets [Line Items] | |||
Aggregate minimum future payments on office leases | $ 145,100 |
Commitments and Contingencies - Summary of Minimum Future Office Space and Equipment Lease Payments Due (Detail) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Operating Leased Assets [Line Items] | |
2016 | $ 36,386 |
2017 | 31,121 |
2018 | 22,869 |
2019 | 18,860 |
2020 | 16,229 |
Thereafter | 22,600 |
Total | 148,065 |
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals | 600 |
Office Leases [Member] | |
Operating Leased Assets [Line Items] | |
Total | $ 145,100 |
Commitments and Contingencies Commitments and Contingencies - HRMC Details (Details) £ in Millions, $ in Millions |
3 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2017
GBP (£)
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2017
GBP (£)
|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
GBP (£)
|
|
Loss Contingencies [Line Items] | ||||||
Employee Benefit Tax Settlement, Gross Amount | $ 6.8 | £ 5.4 | ||||
Employee Benefit Tax Settlement, Reimbursement Amount | $ 2.9 | £ 2.3 | ||||
Employee Benefit Tax Settlement, Payment | $ 6.9 | £ 5.4 | ||||
Employee Benefit Tax Settlement, Reimbursement Received | $ 2.6 | £ 2.0 | ||||
Employee Benefit Tax Settlement, Receivable | $ 0.4 | £ 0.3 | ||||
Salaries and Employee Benefits [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Employee Benefit Tax Settlement, Gross Amount | 1.5 | |||||
Other, Net [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Employee Benefit Tax Settlement, Gross Amount | $ 2.4 |
Subsequent Event (Details) - Jan. 04, 2018 - Subsequent Event [Member] kr in Millions, $ in Millions |
USD ($) |
DKK (kr) |
DKK (kr) |
---|---|---|---|
Subsequent Event [Line Items] | |||
Business Combination, Consideration Transferred | $ 3.9 | kr 24.3 | |
Business Combination, Contingent Consideration, Liability | $ 4.5 | kr 28.0 |
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