19.	Recent Accounting Pronouncements

February 2016,

the FASB issued ASU

No.

2016

02,

“Leases (Topic

842

)” (“ASU

2016

02”

), which provides guidance for accounting for leases. ASU

2016

requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than

months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight-line basis over the term of the lease. Accounting for lessors remains largely unchanged from current GAAP. ASU

2016

was effective for the Company on

November 1, 2019

and we applied the modified retrospective method of adoption, resulting in

restatement of prior period financial statements. We elected the practical expedient package which allows us to carry forward our original assessment of whether contracts contained leases, lease classification and the initial direct costs. We also elected the practical expedient that allows lessees the option to account for lease and non-lease components together as a single component for all classes of underlying assets. The adoption of ASU

2016

resulted in a gross up on our Condensed Consolidated Balance Sheets for ROU assets and lease liabilities of

$23.3

million and

$24.4

million, respectively, as of

November 1, 2019.

Existing prepaid rent and accrued rent were recorded as an offset to the gross operating ROU assets. Our ROU assets are included in “Prepaid expenses and other assets” and the corresponding lease liabilities are included in “Accounts payable and other liabilities” line items on our Condensed Consolidated Balance Sheets. The adoption of ASU

2016

had

impact on our condensed consolidated statements of operations or cash flows, nor did it have a significant impact on our business processes, systems or internal controls.

July 2018,

the FASB issued ASU

No.

2018

09,

“Codification Improvements” (“ASU

2018

09”

). ASU

2018

provides amendments to a wide variety of topics in the FASB’s Accounting Standards Codification, which applies to all reporting entities within the scope of the affected accounting guidance. The transition and effective date guidance are based on the facts and circumstances of each amendment. Some of the amendments in ASU

2018

not

require transition guidance and were effective upon issuance of ASU

2018

09.

However, many of the amendments do have transition guidance with effective dates for annual periods beginning after

December 15, 2018.

The adoption of the applicable guidance of ASU

2018

did

not

have any significant impact on our Condensed Consolidated Financial Statements.

August 2018,

the FASB issued ASU

No.

2018

13,

“Fair Value Measurement (Topic

820

) - Disclosure Framework” (“ASU

2018

13”

), which improves the disclosure requirements for fair value measurements. ASU

2018

is effective for us beginning

November

2020.

Early adoption is permitted for any removed or modified disclosures. We are currently evaluating the potential impact of adopting this guidance on our Condensed Consolidated Financial Statements.

August 2018,

the FASB issued ASU

No.

2018

“Intangibles-Goodwill and Other-Internal-Use Software (Subtopic

350

): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract” (“ASU

2018

15”

). ASU

2018

aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ASU

2018

is effective for us beginning

November 1, 2020.

Early adoption is permitted. We are currently evaluating the potential impact of adopting this guidance on our Condensed Consolidated Financial Statements.