Note 1 - Nature of Operations and Basis of Presentation	6 Months Ended
Jun. 30, 2017
Notes to Financial Statements
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION Nature of Operations ICF International, Inc. and its subsidiaries (collectively, the “ Company”) provide professional services, including management, technology, and policy consulting and implementation services, to government and commercial clients that operate in four key markets: energy, environment, and infrastructure; health, education and social programs; safety and security; and consumer and financial. The Company offers a full range of services to these clients throughout the entire life cycle of a policy, program, project or initiative, ranging from initial research and analysis, to design and implementation of programs and technology-based solutions, including the provision and delivery of engagement services and programs. The Company ’s major clients are United States (“U.S.”) federal government departments and agencies, most significantly the Department of Health and Human Services, the Department of State, and the Department of Defense. The Company also serves U.S. state and local government departments and agencies, international governments, and commercial clients worldwide. Commercial clients include: airlines, airports, electric and gas utilities, hospitals, health insurers and other health related companies, oil companies, banks and other financial services companies, transportation, travel and hospitality firms, non-profits/associations, law firms, manufacturing firms, retail chains, and distribution companies. The term “federal” or “federal government” refers to the U.S. federal government, and “state and local” or “state and local government” refers to U.S. state and local governments, unless otherwise indicated. The Company, incorporated in Delaware, is headquartered in Fairfax, Virginia. It maintains offices throughout the world, including over 55 offices in the U.S. and more than 10 offices in key markets outside the U.S., including offices in the United Kingdom, Belgium, China, India and Canada. Interim Results The unaudited consolidated financial statements included in this Quarterly Report on Form 10 -Q have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These rules and regulations permit some of the information and footnote disclosures normally included in financial statements , prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), to be condensed or omitted. In management’s opinion, the unaudited consolidated financial statements contain all adjustments that are of a normal recurring nature, necessary for a fair presentation of the results of operations and financial position of the Company for the interim periods presented. The Company reports operating results and financial data in one operating and reportable segment. Operating results for the six -month period ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2016, and the notes thereto included in the Company’s Annual Report on Form 10 -K, filed with the SEC on February 28, 2017 ( “the Annual Report”). Significant Accounting Policies Goodwill Impairment Test Date The Company has historically performed its annual goodwill impairment test as of September 30 of each year. For the annual impairment test as of September 30, 2016, the Company performed a qualitative assessment of whether it was more likely than not that the Company’s reporting unit's fair value was less than its carrying amount. After completing the assessment, the Company determined that it was more likely than not that the estimated fair value of the reporting unit exceeded the carrying amount and that no impairment existed as of the assessment date. If the Company had concluded otherwise, a quantitative goodwill impairment test would have been required, which would have included a determination of the fair value of the reporting unit and a comparison of the fair value to its carrying value. Effective for the annual goodwill impairment test for 2017 and for future testing , the Company will perform the required annual test as of October 1 of each year rather than on September 30. The Company does not believe that the change in the date of the annual goodwill impairment test is a material change in the method of applying an accounting principle nor does it expect that it will result in any delay, acceleration or impact to the results of the impairment testing. The Company believes this date is preferable because it aligns with the timing of the annual strategic planning process which largely occurs during the fourth quarter. Retrospective application to prior periods is impracticable as the Company is unable to objectively determine, without the use of hindsight, the assumptions that would be used in those earlier periods. Other than the anticipated change in the date of its annual goodwill impairment test, there have been no other changes to any other significant accounting policy as further described in Note 2, Summary of Significant Accounting Policie s , of the Notes to the Consolidated Financial Statements in the Annual Report. Other Comprehensive Income 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) (“AOCI”) in stockholders’ equity in the Company’s consolidated balance sheets. Recent Accountin g Pronouncements Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“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 including industry-specific revenue recognition guidance. Included in the new principles-based revenue recognition model are changes to the basis for determining the timing for revenue recognition. In addition, the standard expands and improves revenue disclosures. In August 2015, the FASB issued ASU 2015 - 14 to amend ASU 2014 - 09 in order to defer the effective date of the new standard. In accordance with this update, the Company has elected to adopt the requirements of the new standard effective January 1, 2018. The guidance permits the Company to either apply the requirements retrospectively to all prior periods presented (full retrospective), or apply the requirements in the year of adoption through a cumulative adjustment (modified retrospective). Under the full retrospective approach, the 2016 and 2017 financial statements would be adjusted to reflect the effects of adopting the new standard. Under the modified retrospective approach, the new standard would, for the period beginning January 1, 2018, apply to new contracts and those that were not completed as of January 1, 2018. For those contracts not completed as of January 1, 2018, this method will result in a cumulative catch-up adjustment to retained earnings. The Company has evaluated the impact of adopting ASU 2014 - 09 on the timing of revenue and expanded disclosure requirements. The Company completed its impact assessment as of June 2017 and has started the implementation phase. Based on this assessment, the Company concluded that, for the majority of its contracts, there is no change in the timing of revenue recognition. However, the new standard will result in a change in revenue timing for performance incentives under certain contracts. Under current guidance, performance incentives are recognized as revenue when specific quantitative goals are achieved, generally at the end of a measurement period. Under the new standard, these incentives are considered variable consideration and the Company will include the most likely amount of the incentives to be earned in the transaction price and recognize revenue associated with the incentives over the term of the agreement. This change is not expected to result in a material change to the Company’s annual revenue since most incentives have a one year measurement period, but the change may accelerate revenue recognized on a quarterly basis. In addition, the new standard changes the guidance regarding principal versus agent revenue reporting which may result in recognition on a gross basis in regards to certain media purchases for the Company’s advertising contracts. Under the gross basis, the Company would recognize as revenue the media cost plus the fee that the Company expects to earn for arranging the purchase, rather than, as in the current practice, to recognize as revenue only the amount of fee that the Company expects to earn. At this time, the Company is in the process of finalizing its evaluation of the impact that the method of adoption will have on its consolidated financial statements and, as a result, has not finalized its adoption method (full retrospective or modified retrospective). Adoption of the new standard will entail successful completion of the implementation phase which includes modifying existing policies, processes and controls as they relate to revenue recognition as well as to the preparation of the required disclosures. Leases In February 2016, the FASB issued ASU 2016 - 02, Leases (Topic 842 ). This update revises an entity ’s accounting for operating leases and requires lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. This update also requires that lessees recognize assets and liabilities on the balance sheet for the rights and obligations created by all such leases and requires disclosures designed to give financial statement users information on the amount and timing of lease expenses arising from such leases. These disclosures include certain qualitative and specific quantitative disclosures. For lessees, the new guidance is not expected to significantly change the recognition, measurement, and presentation of expenses arising from a lease. This update is effective for the first interim and annual periods beginning after December 15, 2018, with early adoption permitted. The Company continues to evaluate the impact of adopting ASU 2016 - 02, the elections to be made at adoption in a modified retrospective approach, and the timing of adoption. Statement of Cash Flows In August 2016, the FASB issued ASU 2016 - 15, Statement of Cash Flows (Topic 230 ): Classification of Certain Cash Receipts and Cash Payments. This update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. This update is effective for the Company for its fiscal year 2018, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2016 - 15. The Company does not expect the update to have a material impact on the consolidated financial statements. In November 2016, the FASB issued ASU 2016 - 18, Statement of Cash Flows (Topic 230 ): Restricted Cash (a consensus of the FASB Emerging Issues Task Force), which requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and cash equivalents in the statement of cash flows. ASU 2016 - 18 becomes effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company will apply any adjustments retrospectively. Early adoption of the standard is permitted, and the Company anticipates it will early adopt the standard. The Company is evaluating the impact of ASU 2016 - 18 on its consolidated financial statements resulting from the future adoption of the standard. Restricted cash is currently included within operating cash flows in the consolidated statement of cash flows for all periods presented. Goodwill In January 2017, the FASB issued ASU 2017 - 04, Intangibles – Goodwill and Other (Topic 350 ), which simplifies the measurement of goodwill by eliminating Step 2 from the current goodwill impairment test in the event that there is evidence of an impairment based on qualitative or quantitative assessments. ASU 2017 - 04 does not change how the goodwill impairment is identified, and the Company will continue to perform a qualitative assessment annually to determine whether the two step impairment test is required. The current accounting standard requires the impairment loss to be recognized under Step 2 of the impairment test. This requires the Company to determine whether the carrying amount of the reporting unit ’s goodwill exceeds its implied fair value. The implied fair value is calculated by assigning the fair value of the reporting unit to all of its assets and liabilities as if it had been acquired in a business combination. The new standard would require the Company to determine the fair value of the reporting unit and subtract the carrying value from the fair value of the reporting unit to determine if there is an impairment. ASU 2017 - 04 is effective for the Company for fiscal years after December 15, 2019, and early adoption is permitted. ASU 2017 - 04 is required to be adopted prospectively, and the adoption is effective for annual goodwill impairment tests performed in the year of adoption. The Company is evaluating the impact of ASU 2017 - 04 on its consolidated financial statements resulting from the adoption of the standard.

NOTE

NATURE OF OPERATIONS

AND BASIS OF PRESENTATION

Nature of Operations

ICF International, Inc. and its subsidiaries (collectively, the “

Company”) provide professional services, including management, technology, and policy consulting and implementation services, to government and commercial clients that operate in

four

key markets: energy, environment, and infrastructure; health, education and social programs; safety and security; and consumer and financial. The Company offers a full range of services to these clients throughout the entire life cycle of a policy, program, project or initiative, ranging from initial research and analysis, to design and implementation of programs and technology-based solutions, including the provision and delivery of engagement services and programs.

The Company

’s major clients are United States (“U.S.”) federal government departments and agencies, most significantly the Department of Health and Human Services, the Department of State, and the Department of Defense. The Company also serves U.S. state and local government departments and agencies, international governments, and commercial clients worldwide. Commercial clients include: airlines, airports, electric and gas utilities, hospitals, health insurers and other health related companies, oil companies, banks and other financial services companies, transportation, travel and hospitality firms, non-profits/associations, law firms, manufacturing firms, retail chains, and distribution companies. The term “federal” or “federal government” refers to the U.S. federal government, and “state and local” or “state and local government” refers to U.S. state and local governments, unless otherwise indicated.

The Company, incorporated in Delaware, is headquartered in Fairfax, Virginia. It maintains offices throughout the world, including over

offices in the U.S. and more than

offices in key markets outside the U.S., including offices in the United Kingdom, Belgium, China, India and Canada.

Interim Results

The unaudited consolidated financial statements included in this Quarterly Report on Form

-Q have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These rules and regulations permit some of the information and footnote disclosures normally included in financial statements

, prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), to be condensed or omitted. In management’s opinion, the unaudited consolidated financial statements contain all adjustments that are of a normal recurring nature, necessary for a fair presentation of the results of operations and financial position of the Company for the interim periods presented. The Company reports operating results and financial data in

one

operating and reportable segment. Operating results for the

six

-month period ended

June 30, 2017

are

not

necessarily indicative of the results that

may

be expected for the year ending

December

31,

2017.

These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended

December 31, 2016,

and the notes thereto included in the Company’s Annual Report on Form

-K, filed with the SEC on

February 28, 2017 (

“the Annual Report”).

Significant Accounting Policies

Goodwill Impairment

Test

Date

The Company

has historically performed its annual goodwill impairment test as of

September 30

of each year. For the annual impairment test as of

September 30, 2016,

the Company performed a qualitative assessment of whether it was more likely than

not

that the Company’s reporting unit's fair value was less than its carrying amount. After completing the assessment, the Company determined that it was more likely than

not

that the estimated fair value of the reporting unit exceeded the carrying amount and that

impairment existed as of the assessment date. If the Company had concluded otherwise, a quantitative goodwill impairment test would have been required, which would have included a determination of the fair value of the reporting unit and a comparison of the fair value to its carrying value.

Effective for

the annual goodwill impairment test for

2017

and for future testing

, the Company will perform the required annual test as of

October 1

of each year rather than on

September 30.

The Company does

not

believe that the change in the date of the annual goodwill impairment test is a material change in the method of applying an accounting principle nor does it expect that it will result in any delay, acceleration or impact to the results of the impairment testing. The Company believes this date is preferable because it aligns with the timing of the annual strategic planning process which largely occurs during the

fourth

quarter. Retrospective application to prior periods is impracticable as the Company is unable to objectively determine, without the use of hindsight, the assumptions that would be used in those earlier periods. Other than the anticipated change in the date of its annual goodwill impairment test, there have been

other changes to any other significant accounting policy as further described in Note

Summary of Significant Accounting Policie

, of the Notes to the Consolidated Financial Statements in the Annual Report.

Other Comprehensive Income

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) (“AOCI”) in stockholders’ equity in the Company’s consolidated balance sheets.

Recent

Accountin

g Pronouncements

Revenue Recognition

May 2014,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”)

2014

09,

Revenue from Contracts with Customers (Topic

606

). ASU

2014

provides a single comprehensive revenue recognition framework and supersedes almost all existing revenue recognition guidance including industry-specific revenue recognition guidance. Included in the new principles-based revenue recognition model are changes to the basis for determining the timing for revenue recognition. In addition, the standard expands and improves revenue disclosures. In

August 2015,

the FASB issued ASU

2015

to amend ASU

2014

in order to defer the effective date of the new standard. In accordance with this update, the Company has elected to adopt the requirements of the new standard effective

January 1, 2018.

The guidance permits the Company to either apply the requirements retrospectively to all prior periods presented (full retrospective), or apply the requirements in the year of adoption through a cumulative adjustment (modified retrospective). Under the full retrospective approach, the

2016

and

2017

financial statements would be adjusted to reflect the effects of adopting the new standard. Under the modified retrospective approach, the new standard would, for the period beginning

January 1, 2018,

apply to new contracts and those that were

not

completed as of

January 1, 2018.

For those contracts

not

completed as of

January 1, 2018,

this

method will result in a cumulative catch-up adjustment to retained earnings.

The Company has evaluated the impact of adopting ASU

2014

on the timing of revenue and expanded disclosure requirements. The Company completed its impact assessment as of

June 2017

and has started the implementation phase. Based on this assessment, the Company concluded that, for

the majority of its contracts, there is

change in the timing of revenue recognition. However, the new standard will result in a change in revenue timing for performance incentives under certain contracts. Under current guidance, performance incentives are recognized as revenue when specific quantitative goals are achieved, generally at the end of a measurement period. Under the new standard, these incentives are considered variable consideration and the Company will include the most likely amount of the incentives to be earned in the transaction price and recognize revenue associated with the incentives over the term of the agreement. This change is

not

expected to result in a material change to the Company’s annual revenue since most incentives have a

one

year measurement period, but the change

may

accelerate revenue recognized on a quarterly basis. In addition, the new standard changes the guidance regarding principal versus agent revenue reporting which

may

result in recognition on a gross basis in regards to certain media purchases for the Company’s advertising contracts. Under the gross basis, the Company would recognize as revenue the media cost plus the fee that the Company expects to earn for arranging the purchase, rather than, as in the current practice, to recognize as revenue only the amount of fee that the Company expects to earn. At this time, the Company is in the process of finalizing its evaluation of the impact that the method of adoption will have on its consolidated financial statements and, as a result, has

not

finalized its adoption method (full retrospective or modified retrospective). Adoption of the new standard will entail successful completion of the implementation phase which includes modifying existing policies, processes and controls as they relate to revenue recognition as well as to the preparation of the required disclosures.

Leases

February 2016,

the FASB issued ASU

2016

02,

Leases (Topic

842

). This update revises an entity

’s accounting for operating leases and requires lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than

months. This update also requires that lessees recognize assets and liabilities on the balance sheet for the rights and obligations created by all such leases and requires disclosures designed to give financial statement users information on the amount and timing of lease expenses arising from such leases. These disclosures include certain qualitative and specific quantitative disclosures. For lessees, the new guidance is

not

expected to significantly change the recognition, measurement, and presentation of expenses arising from a lease. This update is effective for the

first

interim and annual periods beginning after

December

15,

2018,

with early adoption permitted.

The Company continues to evaluate the impact of adopting ASU

2016

02,

the elections to be made at adoption in a modified retrospective approach, and the timing of adoption.

Statement of Cash Flows

August 2016,

the FASB issued ASU

2016

15,

Statement of Cash Flows

(Topic

230

): Classification of Certain Cash Receipts and Cash Payments. This update addresses

eight

specific cash flow issues with the objective of reducing the existing diversity in practice. This update is effective for the Company for its fiscal year

2018,

with early adoption permitted. The Company is currently evaluating the impact of adopting ASU

2016

15.

The Company does

not

expect the update to have a material impact on the consolidated financial statements.

November 2016,

the FASB issued ASU

2016

18,

Statement of Cash Flows

(Topic

230

): Restricted Cash (a consensus of the FASB Emerging Issues Task Force), which requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. As a result, entities will

longer present transfers between cash and cash equivalents and restricted cash and cash equivalents in the statement of cash flows. ASU

2016

becomes effective for fiscal years beginning after

December 15, 2017,

and interim periods within those fiscal years. The Company will apply any adjustments retrospectively. Early adoption of the standard is permitted, and the Company anticipates it will early adopt the standard. The Company is evaluating the impact of ASU

2016

on its consolidated financial statements resulting from the future adoption of the standard. Restricted cash is currently included within operating cash flows in the consolidated statement of cash flows for all periods presented.

Goodwill

January 2017,

the FASB issued ASU

2017

04,

Intangibles

– Goodwill and Other (Topic

350

), which simplifies the measurement of goodwill by eliminating Step

from the current goodwill impairment test in the event that there is evidence of an impairment based on qualitative or quantitative assessments. ASU

2017

does

not

change how the goodwill impairment is identified, and the Company will continue to perform a qualitative assessment annually to determine whether the

two

step impairment test is required. The current accounting standard requires the impairment loss to be recognized under Step

of the impairment test.

This requires the Company to determine whether the carrying amount of the reporting unit

’s goodwill exceeds its implied fair value. The implied fair value is calculated by assigning the fair value of the reporting unit to all of its assets and liabilities as if it had been acquired in a business combination.

The new standard would require the Company to determine the fair value of the reporting unit and subtract the carrying value from the fair value of the reporting unit to determine if there is an impairment. ASU

2017

is effective for the Company for fiscal years after

December 15, 2019,

and early adoption is permitted. ASU

2017

is required to be adopted prospectively, and the adoption is effective for annual goodwill impairment tests performed in the year of adoption. The Company is evaluating the impact of ASU

2017

on its consolidated financial statements resulting from the adoption of the standard.