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Leases

6 Months Ended

Jun. 30, 2020

The Company conducts its operations using facilities leased under operating lease agreements that expire at various dates. The Company finances its use of certain motor vehicles and other equipment under various lease arrangements provided by financial institutions.

The Company had performed an evaluation of its contracts with suppliers in accordance with Topic 842 and had determined that, except for leases for office facilities, motor vehicles and other equipment as described above, none of the Company’s contracts contain a lease. In assessment of the lease term, the Company considers the extension option as part of its lease term for those lease arrangements where the Company is reasonably certain of availing the extension option. The lease agreements do not contain any covenant to impose any restrictions except for market-standard practice for similar lease arrangements.

The impact of the COVID-19 pandemic on the economic environment is uncertain and has caused variability in the determination of the incremental borrowing rate, which has impacted the measurement of lease liabilities and ROU assets.

The Company accounts for lease-related concessions to mitigate the economic effects of COVID-19 on lessees in accordance with guidance in Topic 842, Leases, to determine on lease-by-lease basis, whether the concession provided by a lessor should be accounted for as a lease modification. Such concessions had an insignificant impact on our unaudited consolidated financial statements during the three and six months ended June 30, 2020.

Supplemental balance sheet information


	As of
	June 30, 2020		December 31, 2019
Operating Lease
Operating lease right-of-use assets	$	96,789	$	86,396

Operating lease liabilities - Current	$	18,199	$	24,148
Operating lease liabilities - Non-current	90,934		74,709
Total operating lease liabilities	$	109,133	$	98,857

Finance Lease
Property and equipment, gross	$	1,564	$	1,757
Accumulated depreciation	(995)		(1,120)
Property and equipment, net	$	569	$	637

Finance lease liabilities - Current	$	253	$	253
Finance lease liabilities - Non-current	357		430
Total finance lease liabilities	$	610	$	683

Finance lease liabilities are presented as a part of “accrued expenses and other current liabilities” and “other non-current liabilities,” as applicable, in the Company’s consolidated balance sheets.

During the three months ended June 30, 2019, the Company performed an impairment test of its long-lived assets of its Health Integrated business. Based on the results, the operating lease ROU assets carrying value exceeded their fair value. As a result of this analysis, the Company recognized impairment on ROU assets of $989 during the three and six months ended June 30, 2019, in the unaudited consolidated statements of income under "impairment and restructuring charges".

The components of lease cost, which are included in the Company's unaudited consolidated statements of income, are as follows:


Lease cost	Three months ended June 30,						Six months ended June 30,
Finance lease:	2020		2019		2020		2019
Amortization of right-of-use assets	$	63	$	92	$	125	$	187
Interest on lease liabilities	20		20		50		45
	83		112		175		232

Operating lease^(a)	6,850		6,684		13,703		13,701
	6,850		6,684		13,703		13,701

Sublease income	—		(105)		—		(105)
Total lease cost	$	6,933	$	6,691	$	13,878	$	13,828

(a) Includes short-term leases, which are immaterial.

Supplemental cash flow and other information related to leases are as follows:


	Six months ended June 30,
	2020			2019
Cash payments for amounts included in the measurement of lease liabilities :
Operating cash outflows for operating leases	$	12,831		$	13,749
Operating cash outflows for finance leases	$	50		$	45
Financing cash outflows for finance leases	$	124		$	207
Right-of-use assets obtained in exchange for new operating lease liabilities	$	17,999		$	27,750
Right-of-use assets obtained in exchange for new finance lease liabilities	$	75		$	144
Weighted-average remaining lease term
Finance lease	2.1 years			2.4 years
Operating lease	6.8 years			6.5 years
Weighted-average discount rate
Finance lease	10.2		%	8.7		%
Operating lease	7.4		%	7.3		%

The Company determines the incremental borrowing rate by adjusting the benchmark reference rates, applicable to the respective geographies where the leases were entered, with appropriate financing spreads and lease specific adjustments for the effects of collateral.

Maturities of lease liabilities as of June 30, 2020 are as follows:


	Operating Leases		Finance Leases
2020 (July 1 - December 31)	$	12,989	$	183
2021	24,909		266
2022	23,121		153
2023	21,205		103
2024	16,841		32
2025 and thereafter	43,770		6
Total lease payments	$	142,835	$	743
Less: Imputed interest	33,702		133
Present value of lease liabilities	$	109,133	$	610

Maturities of minimum lease payments as of December 31, 2019 are as follows:


During the next twelve months ending December 31,	Operating Leases		Capital Leases
2020	$	26,932	$	325
2021	23,783		251
2022	21,526		157
2023	19,381		86
2024	14,865		22
2025 and thereafter	23,983		—
Total minimum lease payment	$	130,470	$	841
Less: Imputed interest	31,613		158
Present value of minimum lease payments	$	98,857	$	683

Leases