Note 2. Summary of Significant Accounting Policies

Goodwill

The Company performs its annual goodwill impairment review as of September 30 of each year. For the purposes of performing this review, the Company has concluded that it is one reporting unit. For the annual impairment review as of September 30, 2015, the Company opted to perform a qualitative assessment of whether it is more likely than not that our reporting unit's fair value is less than its carrying amount. If, after completing its qualitative assessment, the Company determines that it is not more likely than not that the carrying value exceeds the estimated fair value, it may conclude that no impairment exists. If the Company concludes otherwise, a two-step goodwill impairment test must be performed, which includes a comparison of the fair value of the reporting unit to the carrying value.

The Company’s qualitative analysis as of September 30, 2015 included macroeconomic and industry and market specific considerations, financial performance indicators and measurements, and other factors. Based on the Company’s qualitative assessment, it determined that it is not more likely than not that the fair value of its one reporting unit is less than its carrying amount, and thus the two-step impairment test is not required to be performed for 2015. Therefore, based upon management’s review, no goodwill impairment charge was required as of September 30, 2015. Historically, the Company has recorded no goodwill impairment charges.

Fair Value of Financial Instruments

The Company's financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, and other current liabilities, are carried at cost, which the Company believes approximates their fair values at September 30, 2015, due to their short maturities. The Company believes the carrying value of its lines of credit payable approximate the estimated fair value for debt with similar terms, interest rates, and remaining maturities currently available to companies with similar credit ratings at September 30, 2015. The Company applies the provisions of ASC 820,

Fair Value Measurements and Disclosures

to its assets and liabilities that are required to be measured at fair value pursuant to other accounting standards, including assets and liabilities resulting from the Company’s nonqualified deferred compensation plan and foreign currency forward contract agreements not eligible for hedge accounting. The impact of the amounts recorded for the nonqualified deferred compensation plan and the forward contract agreements was immaterial to the consolidated financial statements.

Other Comprehensive In

come

Other comprehensive income represents foreign currency translation adjustments arising from the use of differing exchange rates from period to period. The financial positions and results of operations of the Company’s foreign subsidiaries are based on the local currency as the functional currency and are translated to U.S. dollars for financial reporting purposes. Assets and liabilities of the subsidiaries are translated at the exchange rate in effect at each period-end. Income statement accounts are translated at the average rate of exchange prevailing during the period. Translation adjustments are included in accumulated other comprehensive income (loss) in stockholders’ equity in the Company’s consolidated balance sheets.

The activity included in other comprehensive income (loss) in the Company’s consolidated statements of comprehensive income related to foreign currency translation adjustments for each period reported is summarized below:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Foreign currency translation adjustments ( 1 )	$	(3,900	)	$	(1,355	)	$	(5,155	)	$	(1,421	)
Realized losses reclassified into earnings, net of tax ( 2 )		—			—			666			526
Other comprehensive loss, net of tax	$	(3,900	)	$	(1,355	)	$	(4,489	)	$	(895	)

(1)	In the third quarter of 2015, the Company recorded foreign currency translation adjustments totaling approximately $4.0 million primarily related to goodwill, intangible assets and fixed assets for certain acquired international subsidiaries.

(2)	Represents the reclassification of foreign currency translation adjustments from accumulated other comprehensive loss into earnings as a result of closing international offices. Amounts are included in the other expense line item in the consolidated statements of comprehensive income.

Recent Accounting Pronouncements

Recent

ccounting

ronouncements not yet

dopted

In May 2014, the FASB issued ASU 2014-09,

Revenue from Contracts with Customers

(

Topic 606)

. ASU 2014-09 provides a single comprehensive revenue recognition framework and supersedes almost all existing revenue recognition guidance. Included in the new principles-based revenue recognition model are changes to the basis for deciding on the timing for revenue recognition. In addition, the standard expands and improves revenue disclosures. In August 2015, the FASB issued ASU 2015-14,

Revenue from Contracts with Customers

(

Topic 606)

: Deferral of Effective Date

, to amend ASU 2014-09 to defer the effective date of the new revenue recognition standard. As a result, ASU 2014-09 is effective for the Company for its fiscal year 2018 and can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption. The Company is currently evaluating the impact of adopting ASU 2014-09.

In September 2015, the FASB issued ASU 2015-16,

Simplifying the Accounting for Measurement-Period Adjustments (Topic 805).

ASU 2015-16 eliminates the requirement for an acquirer to retrospectively account for adjustments made to provisional amounts recognized in a business combination to reflect new information that existed as of the acquisition date. Instead, an acquirer will recognize these measurement-period adjustments during the period in which it determines the amount of the adjustment.

ASU 2015-16 is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years, with early adoption permitted. The adoption of ASU 2015-16 is not expected to have a material impact on the Company’s consolidated financial statements.