Summary of Significant Accounting Policies Recent Accounting Pronouncements (Policies)

12 Months Ended

Dec. 31, 2019

Organization Consolidation And Presentation Of Financial Statements [Abstract]

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Recent Accounting Pronouncements

The following table provides a brief description of recent accounting pronouncements and expected impact on our financial statements:



Standard	Description	Date of adoption	Effect on the financial statements or other significant matters
Not yet adopted:





ASU 2016-13, June 2016, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	This ASU replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This ASU also applies to how the Company evaluates impairments of any available-for-sale debt securities and any lease receivables arising from leases classified as sales-type or direct finance leases.	January 2020	The Company has evaluated this ASU and, based on the nature of financial instruments within scope of the standard, has determined that the impact of adoption is limited to recognizing impairments of available-for-sale debt securities in earnings. The Company’s available-for-sale debt securities have a fair value of $10.8 million at December 31, 2019, as seen in note 11. Additional disclosures, if material, are also required.

ASU 2018-19, November 2018: Codification Improvements to Topic 326, Financial Instruments - Credit Losses	This ASU clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases.	January 2020	The adoption of this ASU will not have a material impact on the Company’s financial statements and related disclosures. See Leases section of Note 1 for disclosure of collectibility policy over lease receivables from operating leases.

ASU 2018-13, August 2018: Fair Value Measurements (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement	This ASU modifies the disclosure requirements for fair value measurements within the scope of Topic 820, Fair Value Measurements, including the removal and modification of certain existing disclosures, and the additional of new disclosures for certain types of fair value measurements.	January 2020	The Company has evaluated the impact of adopting this new accounting standard, whose impact is limited to fair value measurement disclosures. Based on the nature of the Company’s fair value measurements and disclosure requirements, the adoption of this standard is not expected to have an impact on the Company’s financial statements or related disclosures.

ASU 2018-15, August 2018, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract	The amendments in this ASU align 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 (and hosting arrangements that include an internal-use software license). The ASU provides further clarification of the appropriate presentation of capitalized costs, the period over which to recognize the expense, the presentation within the Statements of Operations and Statements of Cash Flows, and the disclosure requirements. Early adoption of the standard is permitted.	January 2020	The Company has evaluated the accounting standard, which is consistent with existing practice, and therefore it will not have a material impact on the Company’s financial statements and related disclosures.

Description

Date of adoption

Effect on the financial statements or other significant matters

Recently adopted:

Leases (Topic 842) and related updates:

ASU 2016-02, February 2016, Leases (Topic 842)

ASU 2018-10, July 2018: Codification Improvements to Topic 842, Leases

ASU 2018-11, July 2018, Leases (Topic 842): Targeted Improvements

ASU 2018-20, December 2018, Leases (Topic 842): Narrow-Scope Improvements for Lessors

ASU 2019-01, March 2019, Leases (Topic 842): Codification Improvements

Topic 842 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets. It also makes targeted changes to lessor accounting.

The provisions of these ASUs were effective as of January 1, 2019, with early adoption permitted. Topic 842 provides a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief or an additional transition method, allowing for initial application at the date of adoption and a cumulative-effect adjustment to opening retained earnings.

See the updated Leases accounting policy disclosed in Note 1 and the added Leases disclosures in Note 7.

January 2019

The Company has completed its evaluation and adoption of this standard, as discussed in Note 1. The Company utilized the alternative modified retrospective transition method provided in ASU 2018-11 (the “effective date method”), under which the effective date of January 1, 2019, is also the date of initial application.

See the updated Leases accounting policy disclosed in Note 1 and the added disclosures in Note 7, Leases.

Beyond the policy, presentation and disclosure changes discussed, the following changes had direct impact to Net Income from the adoptions of Topic 842:

Capitalization of indirect internal non-contingent lease costs and legal leasing costs are no longer permitted upon the adoption of this standard, which is resulting in an increase to Total operating expenses in the Consolidated Statements of Operations.

Previous capitalization of internal leasing costs was $6.5 million and $10.4 million during the years ended December 31, 2018 and 2017, respectively.

Previous capitalization of internal legal costs was $1.6 million and $1.2 million during the years ended December 31, 2018 and 2017, respectively, including our pro rata share recognized through Equity in income of investments in real estate partnerships.