10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended December 31, 2017

or

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from                  to                 .

Commission File Number: 0-25092

INSIGHT ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)

Delaware	86-0766246
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

6820 South Harl Avenue, Tempe, Arizona 85283

(Address of principal executive offices, Zip Code)

Registrant’s telephone number, including area code: (480) 333-3000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common stock, par value $0.01	The NASDAQ Global Select Market

Securities registered pursuant to Section 12(g) of the Act:

n/a

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☒    No  ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ☐    No  ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to post such files).    Yes  ☒    No  ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.   ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐  (Do not check if a smaller reporting company)	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ☐    No  ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant, based upon the closing price of the registrant’s common stock as reported on The Nasdaq Global Select Market on June 30, 2017, the last business day of the registrant’s most recently completed second fiscal quarter, was $1,410,322,331.

The number of shares outstanding of the registrant’s common stock on February 15, 2018 was 35,836,320.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Proxy Statement relating to its 2018 Annual Meeting of Stockholders have been incorporated by reference into Part III, Items 10, 11, 12, 13 and 14 of this Annual Report on Form 10-K.

INSIGHT ENTERPRISES, INC.

ANNUAL REPORT ON FORM 10-K

Year Ended December 31, 2017

TABLE OF CONTENTS

		Page
PART I
ITEM 1.	Business		2
ITEM 1A.	Risk Factors		10
ITEM 1B.	Unresolved Staff Comments		17
ITEM 2.	Properties		17
ITEM 3.	Legal Proceedings		18
ITEM 4.	Mine Safety Disclosures		18
PART II
ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		19
ITEM 6.	Selected Financial Data		21
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk		43
ITEM 8.	Financial Statements and Supplementary Data		44
ITEM 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure		84
ITEM 9A.	Controls and Procedures		84
ITEM 9B.	Other Information		84
PART III
ITEM 10.	Directors, Executive Officers and Corporate Governance		85
ITEM 11.	Executive Compensation		85
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		85
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence		85
ITEM 14.	Principal Accounting Fees and Services		85
PART IV
ITEM 15.	Exhibits, Financial Statement Schedules		85
ITEM 16.	Form 10-K Summary		85
EXHIBITS TO FORM 10-K			86
SIGNATURES			92

INSIGHT ENTERPRISES, INC.

FORWARD-LOOKING STATEMENTS

Certain statements in this Annual Report on Form 10-K, including statements in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of this report, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include: projections of matters that affect net sales, gross profit, gross margin, operating expenses, earnings from operations, non-operating income and expenses, net earnings or cash flows, cash needs and the payment of accrued expenses and liabilities; the expected effects of seasonality on our business; expectations of further consolidation in the Information Technology (“IT”) industry; our business strategy and our strategic initiatives, including our efforts to grow our core business, develop and grow our global cloud business and build scalable solutions; expectations regarding partner incentives; our expectations about future benefits of our acquisitions and our plans related thereto, including potential expansion into wider regions; the increasing demand for big data solutions; the availability of competitive sources of products for our purchase and resale; our intentions concerning the payment of dividends; our acquisition strategy; our ability to offset the effects of inflation and manage any increase in interest rates; projections of capital expenditures; our plan to migrate EMEA’s IT system; the sufficiency of our capital resources, the availability of financing and our needs or plans relating thereto; the effects of new accounting principles and expected dates of adoption; the effect of indemnification obligations; projections about the outcome of ongoing tax audits; adequate provisions for and our positions and strategies with respect to ongoing and threatened litigation; our exposure to derivative counterparty concentration and non-performance risks; our ability to expand our client relationships; our expectations that pricing pressures in the IT industry will continue; our plans to use cash flow from operations for working capital, to pay down debt, repurchase shares of our common stock, make capital expenditures, and fund acquisitions; our belief that our office facilities are adequate and that we will be able to extend our current leases or locate substitute facilities on satisfactory terms; our expectations that working capital trends will return to normalized levels; our belief that we have adequate provisions for losses; our expectation that we will not incur interest payments under our inventory financing facility; our compliance with leverage ratio requirements; our exposure to off-balance sheet arrangements; statements of belief; and statements of assumptions underlying any of the foregoing. Forward-looking statements are identified by such words as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will,” “may” and variations of such words and similar expressions and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. There can be no assurances that results described in forward-looking statements will be achieved, and actual results could differ materially from those suggested by the forward-looking statements. Some of the important factors that could cause our actual results to differ materially from those projected in any forward-looking statements include, but are not limited to, the following:

• actions of our competitors, including manufacturers and publishers of products we sell;

• our reliance on our partners for product availability, competitive products to sell and marketing funds and purchasing incentives, which can change significantly in the amounts made available and the requirements year over year;

• changes in the IT industry and/or rapid changes in technology;

• risks associated with the integration and operation of acquired businesses;

• possible significant fluctuations in our future operating results;

• the risks associated with our international operations;

• general economic conditions;

• increased debt and interest expense and decreased availability of funds under our financing facilities;

• the security of our electronic and other confidential information;

• disruptions in our IT systems and voice and data networks;

• failure to comply with the terms and conditions of our commercial and public sector contracts;

• legal proceedings and client audits and failure to comply with laws and regulations;

• accounts receivable risks, including increased credit loss experience or extended payment terms with our clients;

• our reliance on independent shipping companies;

• our dependence on certain key personnel;

• natural disasters or other adverse occurrences;

• exposure to changes in, interpretations of, or enforcement trends related to tax rules and regulations; and

• intellectual property infringement claims and challenges to our registered trademarks and trade names.

Any forward-looking statements in this report, including those identified under “Risk Factors” in Part I, Item 1A of this report, should be considered in light of various important factors, including the risks and uncertainties listed above, as well as others. Additionally, there are risks described from time to time in the reports that we file with the Securities and Exchange Commission. We assume no obligation to update, and, except as may be required by law, do not intend to update, any forward-looking statements. We do not endorse any projections regarding future performance that may be made by third parties.

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PART I

Item 1. Business

Our Company

Insight Enterprises, Inc. (“Insight” or the “Company”) is a Fortune 500 global IT provider helping businesses of all sizes – from small and medium sized firms to worldwide enterprises, governments, schools and health care organizations – define, architect, implement and manage Intelligent Technology Solutions^TM in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”). We empower our clients to manage their IT environments so they can drive meaningful business outcomes today and transform their operations for tomorrow.

The Company is organized in the following three operating segments, which are primarily defined by their related geographies:

Operating Segment*	Geography	% of 2017 Consolidated Net Sales
North America	United States and Canada	77%
EMEA	Europe, Middle East and Africa	20%
APAC	Asia-Pacific	3%

* Additional detailed segment and geographic information can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and in Note 20 to the Consolidated Financial Statements in Part II, Item 8 of this report.

This year, 2018, marks 30 years of doing business for Insight. Across three decades, we have evolved with the industry. Each strategic pivot has been made in pursuit of helping our clients run their businesses smarter. Insight began operations in Arizona in 1988, incorporated in Delaware in 1991 and completed its initial public offering in 1995. Our corporate headquarters are located in Tempe, Arizona. From our original location in the United States, we expanded nationwide and then entered Canada in 1997 and the United Kingdom in 1998. Through a combination of acquisitions and organic growth, we continued to increase our geographic coverage and expand our technical capabilities. Our major acquisitions were as follows:

• 2006 – Acquired Software Spectrum, Inc., and expanded our footprint in EMEA and APAC and strengthened our software and related services capabilities;

• 2008 – Acquired Calence, LLC in North America and MINX Limited in the United Kingdom, and enhanced our global technical expertise around higher-end networking and communications technologies, as well as managed services and security;

• 2011 – Acquired Ensynch, Inc. (“Ensynch”) and enhanced our professional services capabilities across the complete Microsoft solution set, including cloud migration and management;

• 2012 – Acquired Inmac GmbH and Micro Warehouse BV (“Inmac”) and expanded our hardware capabilities into key markets in our existing European footprint, specifically in Germany and the Netherlands;

• 2015 – Acquired BlueMetal Architects, Inc. (“BlueMetal”), an interactive design and technology architecture firm, and strengthened our services capabilities in the area of application design, mobility and big data;

• 2016 –Acquired Ignia, Pty Ltd (“Ignia”) and expanded our global footprint in the areas of application design, digital solutions, cloud, mobility and business analytics, while also building on our ability to bring solutions powered by Intelligent Technology Solutions to our clients in APAC; and

• 2017 – On January 6, 2017, we acquired Datalink Corporation (“Datalink”), a leading provider of IT services and enterprise data center solutions based in Eden Prairie, Minnesota, and strengthened our position as a leading IT solutions provider with deep technical expertise delivering data center solutions to clients on premise or in the cloud. On September 26, 2017, we acquired Caase Group B.V. (referred to herein as, “Caase.com”), a Dutch cloud service provider, and strengthened our ability to deliver Intelligent Technology Solutions to our clients in the Netherlands, with a view to expanding into the wider European region in the near future.

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Our Purpose and Values

Our purpose is: “We build meaningful connections to help businesses run smarter.” We live by our core values of Hunger, Heart and Harmony, which set the tone for our business and define who we are. Our core values are:

• Hunger – Our insatiable desire to create new opportunities for our clients and our business is apparent in everything we do.

• Heart – We seek to impact the lives of the people we serve positively by always putting our clients, partners and teammates first.

• Harmony – We invite perspective, and we consistently celebrate each other’s unique contributions as we work together to bring the best solutions to our clients.

We believe that these values strengthen the overall Insight experience for our clients, partners and teammates (we refer to our customers as “clients,” our suppliers as “partners” and our employees as “teammates”).

Our Market

The worldwide total addressable market for information technology is forecasted to be $3.7 trillion annually according to Gartner, a leading IT research and advisory company. Based on our analysis of Gartner market data, we believe the top 10 most comparable global solution providers represent less than 10% of the worldwide total addressable market. We believe our addressable worldwide market in the indirect sales IT channel represents approximately $612 billion in annual sales and for the year ended December 31, 2017, our net sales of $6.7 billion represented approximately 1% of that highly diverse market. We believe that we are well positioned in this highly fragmented global market with locations in 20 countries and have the capabilities to provide clients with hardware, software provisioning and related services and solutions across the globe.

Our Value Proposition

As the IT industry evolves, our value proposition to our clients continues to evolve. The increased complexity across the technology ecosystem, combined with the continual emergence of new trends and offerings, has made it difficult for most clients to effectively manage their IT environments. We consult with our clients regarding their IT hardware and software product and services needs and help our clients define, architect, implement and manage their IT solutions.

We are well positioned to participate in the market as IT continues to transform. Our value drivers include:

• Deep knowledge in client-relevant solution areas

• History of adapting our business model to respond to new technology trends, including the cloud

• Differentiated consulting, technology and managed services offerings

• Ability to scale to serve clients of all sizes and across many verticals

• Strong partner relationships with top market positions

• Global footprint with local presence in key markets

• Flexible capital structure to support future growth, including additional acquisitions

We believe that Insight has a unique position in the market to gain profitable market share by offering Intelligent Technology Solutions that empower our clients to manage their IT environments so they can drive meaningful business outcomes today and transform their operations for tomorrow.

We believe that Insight’s unique advantages include:

• Our global scale and coverage – we have the capabilities to serve clients across the globe with hardware, software provisioning and related services and with integrated technology solutions in multiple countries directly or through our partner network.

• Our operational excellence and systems – we offer a broad selection of hardware and software products with access to billions of dollars in virtual inventory and efficient supply chain execution, as well as product fulfillment and logistics capabilities, management tools and technical expertise.

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• Our software DNA – we understand complex licensing requirements and have the know-how to optimize our clients’ usage and compliance management through a portfolio of license consulting and optimization services.

• Our partner alignment – we have a multi-partner approach and have deep relationships with leading product manufacturers, software publishers and distribution partners, as well as emerging cloud and other technology partners, to service our global portfolio of commercial and public sector clients with the integrated IT solutions that make the most sense for their IT environments.

• Our data center transformation skills – in support of our long-term strategy, in January 2017, we completed the acquisition of Datalink, a leading provider of IT services and enterprise data center solutions, adding deep technical expertise and complementary services offerings to our internally developed solutions and increasing our addressable market opportunity in hybrid cloud and other high-growth data center categories.

• Our next-generation tech skills – we quickly adapt to new technology trends and innovation and, with our acquisition of BlueMetal in 2015, continued our evolution as thought leaders in emerging technologies that help transform our clients’ businesses.

• Our App development and Internet-of-Things (“IoT”) expertise – we were recognized as Microsoft’s Worldwide Partner of the Year for IoT as well as Mobile App Development in each of the past two years and, combined with our hardware and software expertise, we are well-positioned to deliver holistic connected product and IoT solutions.

• Our digital platform – we have customizable client portals, primarily in North America, which allow clients to streamline procurement and processes through a self-service online tool, drive standardization and optimize reconciliation. We also have a best-in-class digital marketing engine to bring scalable solutions to the mid-market.

• Our services solutions – we can scale to help organizations of all sizes and have well-developed services capabilities focused on four solutions areas: supply chain optimization, connected workforce, cloud and datacenter transformation and digital innovation, that represent the ways we help our clients with the demands they face, as discussed in more detail below.

Our Business Strategy

Our long-term strategy remains consistent and includes three components:

• Grow our core business;

• Grow services sales in our key solutions areas; and

• Accelerate with cloud.

Grow our core business. We believe that our core business is strong and continues to present opportunities for growth. We believe that Insight is uniquely positioned to help our clients manage their business effectively today and also transform to meet their changing needs tomorrow. Our balanced portfolio of manufacturer and publisher brands, extensive e-commerce and logistics capabilities and differentiated services capabilities allow us to tailor our offerings based on the size and complexity of the needs of our clients. As a global provider of integrated solutions to business and government clients, we believe we are well-positioned relative to our competitors in several markets. Our go-to-market model leverages both centralized and local market sales and technical and support resources to efficiently serve and advise our clients.

In each of our geographic operating segments we are focused on driving our growth objectives by acquiring new clients and expanding our relationships with existing clients by increasing the types of products and services they buy from us. In North America, we have a local market presence in key cities where we have invested in sales, technical and service delivery resources to drive growth with existing and new clients, particularly in the large account client space. In addition, we drive expansion in specific service/solution areas with key partners. We are also concentrating our efforts on growing our business with mid-sized and large clients in certain vertical markets, including federal government, state and local governments, K-12 education, healthcare and service providers, and have invested in both local market and centralized sales resources to drive these efforts. In EMEA, we are focused on increasing our share in the mid-market and public sector by increasing sales of software and certain hardware categories across the business. We continue to expand our services capabilities in the region and to leverage strategic partner relationships and service-delivery vendors to bring software, cloud and collaboration solutions to our clients. Our APAC operating segment, which is largely comprised of software sales, is engaged in growing sales in the mid-market and enterprise space and in the development of specialized software services, particularly in the areas of software license optimization and cloud.

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Grow services sales in our key solutions areas. The IT market has become more complex and clients are looking for solutions providers to help them navigate the rapidly changing environment. We believe that our core business plus our recent strategic acquisitions provide an integrated foundation that we can leverage to better serve our clients. We have identified four key solutions areas that capitalize on this foundation and include robust offerings to help our clients with the demands they face. Our services capabilities provide significant value-add to our clients, driving stronger client relationships and higher margins. Our key solutions areas are:

• Supply Chain Optimization – We help our clients invest smarter so they can manage today and transform for the future. By optimizing their supply chain, we can help our clients maximize resources and do more today so they can invest in the future.

• Connected Workforce – We help our clients’ employees work smarter so they can manage and transform their businesses. By connecting their workforces, we help our clients create meaningful employee experiences that fuel productivity as well as attract and retain essential talent.

• Cloud and Data Center Transformation – We help our clients run workloads smarter so they can transform business. By defining and navigating cloud and data center platforms, we help our clients optimize and modernize their business.

• Digital Innovation – We help our clients innovate smarter so they can create meaningful connections with their customers. By innovating their digital business, we help our clients monetize existing offerings, create new revenue streams and drive differentiation across their customer experience.

Accelerate with cloud. Private, public and hybrid cloud solutions provide flexible, reliable, secure and affordable solutions for delivering critical IT functions, such as email, data security, Infrastructure as a Service (“IaaS”) and more. Cloud solutions have become more mainstream, and adoption continues to increase across markets and verticals. Key market imperatives in the adoption of cloud solutions are speed to market, flexibility, scalability and availability. We have invested in, and will continue to invest in, technical tools and resources to provide clients with the assessment, migration, integration and managed services required to simplify the cloud adoption decision, whether that decision results in a private, public or hybrid cloud environment.

We also continue to invest in our global cloud management platform, which serves as a marketplace for our clients to buy and manage their cloud subscriptions with options that enhance their Software as a Service (“SaaS”) and IaaS management capabilities.

Components of our cloud management platform include:

• A focus on small to medium-sized clients, providing them with the ability to learn, solve, buy, and manage cloud products and services via our online experience.

• A similar online experience and capabilities for our larger enterprise clients with added IT as a Service Broker (ITaaSB) capabilities allowing larger IT organizations to centrally provide cloud offerings while maintaining the manageability and visibility they require.

Additionally, we have a strong global position in the service provider and independent software vendor (ISV) market. Building on our existing capabilities in this market, we have developed a cloud portfolio for our service provider clients to resell to their customers, offering them revenue diversification with minimal investment. We also plan to expand our cloud management platform capabilities and deliver cloud portal platforms that provide e-commerce and subscription management capabilities to our service provider clients.

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Our Offerings

Our offerings in North America and certain countries in EMEA and APAC include a suite of IT hardware, software and services solutions. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services. On a consolidated basis, hardware, software and services represented approximately 58%, 32% and 10%, respectively, of our net sales in 2017. This compares to 54%, 37% and 9%, respectively, of our consolidated net sales in 2016, and 54%, 38% and 8%, respectively, of our consolidated net sales in 2015. Additional detailed sales mix information by operating segment, including a discussion of changes in our classification of certain revenue streams during 2017, can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and in Note 20 to the Consolidated Financial Statements in Part II, Item 8 of this report. Prior year results were reclassified to conform to the current year presentation, resulting in 3% of our consolidated net sales being reclassified from software to services in both 2016 and 2015. These reclassifications had no effect on consolidated total net sales.

Services Solutions Offerings

We have developed solutions that integrate hardware, software and services to help businesses run smarter within our key solutions areas. Our core solutions include:

Supply Chain Optimization – Growing pressure on IT budgets and increasing trends in outsourcing of non-core functions are changing what clients choose to build versus buy. We provide outsourcing services our clients desire, including management of client infrastructure and end-user operations to drive IT return on investment.

• Product Life Cycle: Source, procure, stage, configure, integrate, test, deploy and maintain IT products spanning endpoints to infrastructure.

• Infrastructure Management: 24x7 remote management of clients’ server/storage/network infrastructure through our ISO-certified Remote Network Operating Center (RNOC).

Connected Workforce – The consumerization of IT, increase in the millennial population and proliferation of alternate work models is transforming the workplace. We provide our clients’ workforce with tools to enable and enhance employee productivity and retention.

• Insight Managed Office: Desktop and notebook devices coupled with cloud-based productivity solutions, deployed through a modern, “over the air” deployment model, managed by Insight’s 24x7 Service Desk. In addition, we see growing demand for “Device-as-a-Service.”

• Insight Managed Mobility: Tablet and cellular-based devices, paired with cloud-based applications and Insight’s 24x7 Service Desk to deliver an end-to-end managed experience where clients can outsource their highly complex mobility environments to Insight in an as-a-service style model.

• Insight Managed Collaboration: Offerings that allow clients to outsource their highly complex voice, conferencing and collaboration/team applications, delivering cloud-based redeployment of modern technologies managed for our clients with both Insight’s onsite and remote Service Desk support professionals.

• Insight Managed Deployment: Service level agreement-based outsourcing of distributed devices and technology, or edge, deployment and support. This comprises multi-site deployments, coupled with dedicated, onsite desktop support technicians coupled with 24x7 Service Desk.

Cloud and Data Center Transformation – Consumption-based models and technology convergence are reinventing decades-old infrastructure business models. We optimize our clients’ public and private infrastructure to enable customer and workforce objectives best suited to their workload and business requirements.

• Hybrid Cloud: On-premise converged infrastructure (private cloud) augmented by off-premise public cloud integrated, managed and secured.

• Intelligent Network: Core WAN, LAN, wireless and security solutions to seamlessly connect Hybrid Cloud, Branch Infrastructure and end users.

Digital Innovation – When interacting with their customers, our clients face growing digital engagement and a rapid shift toward social media. We help our clients leverage technology to better engage their customers to build loyalty and increase profitability.

• Intelligent Endpoints: Digital signage, kiosk, tablet and smartphone endpoints integrated with off-the-shelf software applications.

• Intelligent Applications: Custom-developed applications to enable client-to-customer engagement. These applications are increasingly cloud-based and mobile-centric.

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• Modern Applications: Custom-developed mobile, cloud and IoT applications. Typically, these applications are specific to the client vertical market, e.g., healthcare, financial services or retail.

We have invested in cloud, mobility, big data and security capabilities and expertise to enable our key solutions areas and continuously seek to identify client-relevant technology solutions.

Cloud. Cloud computing represents an evolution in the IT world. Cloud-based SaaS, whereby clients subscribe to software that is hosted either by the software publisher or a dedicated third-party hosting company, is prevalent in the Connected Workforce and Cloud and Data Center Transformation solutions highlighted above. In addition, public IaaS and converged infrastructure private cloud represent growing portions of Hybrid Cloud solutions. We help clients assess readiness, architect appropriate solutions and migrate to both public and private cloud infrastructures.

Mobility. Our clients must engage differently with their customers and fully engage their workforce whether they are at work, at home or on-the-go. We help clients do so through solutions starting with Insight Managed Mobility, an as-a-service like Enterprise Mobility Management (EMS) solution for employees, and modern customer-facing solutions, such as mobile Point of Sale (mPOS) and mobile commerce applications in the retail industry as well as mobile trading applications for brokerage customers in the financial services industry.

Big Data. Our clients are inundated with data that they struggle to interpret. We help turn this data into actionable insights with solutions such as weather-based predictive analytics to drive weekly marketing campaigns for consumer products and patient-based intake and health outcomes analysis to optimize nurse staffing. We expect the proliferation of sensors for IoT will fuel this data overload and drive further demand for these solutions.

Security. All of these solutions must be delivered without compromising customer, company or employee private information. We offer services for identity and access management, single-sign-on (SSO) and mobile-device-management (MDM) to protect end users. In addition, we provide network security and Security Incident Event Management (SIEM) solutions to secure our clients’ infrastructure.

Hardware Offerings

We offer products from hundreds of manufacturers, including such industry leaders as Cisco, HP Inc., Lenovo, Dell, Hewlett Packard Enterprise Company (“HPE”), EMC, Microsoft, NetApp, Apple and IBM. Our scale and purchasing power, combined with our efficient, high-volume and cost effective direct sales and marketing model, allow us to offer competitive prices. We believe that offering choices from multiple partners enables us to better serve our clients by providing a variety of product solutions to address their specific business needs.

In addition to our distribution facilities, we have “direct-ship” programs with many of our partners, including manufacturers and distributors, allowing us to expand our product offerings without increasing inventory, handling costs or inventory risk exposure. As a result, we are able to offer billions of dollars of products in virtual inventory in fulfilling our performance obligations to our clients. Convenience and product options among multiple brands are key competitive advantages compared to manufacturers’ direct selling programs, which are generally limited to their own brands and may not offer clients a complete or best-in-class solution across all product categories.

Software Offerings

Our clients acquire software applications from us in the form of licensing agreements with software publishers or boxed products. We offer products from hundreds of publishers, including such industry leaders as Microsoft, Adobe, VMware, Symantec, McAfee, Citrix, IBM Software and Red Hat, as well as newer entrants, such as Box and 8x8.

As software publishers choose different models for implementing licensing agreements, businesses must evaluate the alternatives to ensure that they select the appropriate agreements and comply with the publishers’ licensing terms when purchasing and managing their software licenses. In addition to software provisioning, we offer holistic software solutions, including software licensing optimization and implementation consulting, to help our clients better understand their software needs, evaluate their existing software and provide options to optimize their assets.

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Our Information Technology Systems

We have committed significant resources to the IT systems that we own and use to manage our business and believe that our success is dependent upon our ability to provide prompt and efficient service to our clients based on the accuracy, quality and utilization of the information generated by our IT systems. Because these systems affect our ability to manage our sales, client service, partner relationships and programs, distribution, inventories and accounting systems and our voice and data networks, we have built redundancy into certain systems, maintain system outage policies and procedures and have comprehensive data backup. We are focused on driving improvements in sales productivity through upgraded IT systems to support higher levels of client satisfaction and new client acquisition, as well as garnering efficiencies in our business.

We operate under a single, standardized IT system across North America and APAC and a separate, single IT system platform in all countries in our EMEA operations. We plan to migrate our EMEA operations to the same IT system used in North America and APAC.

For a discussion of risks associated with our IT systems, see “Risk Factors – Disruptions in our IT systems and voice and data networks could affect our ability to service our clients and cause us to incur additional expenses,” in Part I, Item 1A of this report.

Our Competition

The IT hardware, software and services industry is very fragmented and highly competitive. Our competition includes:

• Direct marketers and resellers, such as CDW (North America and United Kingdom), Systemax (Europe), Softchoice, Comparex, Connection, PCM, World Wide Technology, SHI, SoftwareONE, Computacenter, SCC, Bechtle, Cancom and Crayon;

• National and regional resellers, including value-added resellers, specialty retailers, aggregators, distributors, and to a lesser extent, national computer retailers, computer superstores, Internet-only computer providers, consumer electronics and office supply superstores and mass merchandisers;

• Product manufacturers, such as Dell, HP Inc., IBM, Lenovo and HPE;

• Software publishers, such as IBM, Microsoft and Symantec;

• Systems integrators, such as Compucom Systems, Inc.;

• National and global service providers, such as IBM Global Services and HP Enterprise Services; and

• E-tailers, such as Amazon Web Services (AWS), Newegg, Buy.com and e-Buyer (United Kingdom).

The competitive landscape in the industry is continually changing as various competitors expand their product and services offerings. In addition, emerging models such as cloud computing are creating new competitors and opportunities in messaging, infrastructure, security, collaboration and other services offerings, and, as with other areas, we compete both with resellers and directly with manufacturers, publishers or other service providers for many of these offerings. Further, many of our manufacturer and publisher partners are also our competitors, as many sell directly to business customers, particularly larger corporate customers.

For a discussion of risks associated with the actions of our competitors, see “Risk Factors – The IT hardware, software and services industry is intensely competitive, and actions of our competitors, including manufacturers and publishers of products we sell, can negatively affect our business,” in Part I, Item 1A of this report.

Our Partners

We partner with market leaders offering the top technology brands as well as emerging entrants in the marketplace. During 2017, we purchased products and software from approximately 5,400 partners. Approximately 66% (based on dollar volume) of these purchases were directly from manufacturers or software publishers, with the balance purchased through distributors. Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2017. No other partner accounted for more than 10% of purchases in 2017. Our top five partners as a group for 2017 were Microsoft, Cisco Systems, Tech Data (a distributor), Dell and HP Inc., and approximately 60% of our total purchases during 2017 came from this group of partners. Although brand names and individual products are important to our business, we believe that competitive sources of supply are available in substantially all of our product categories such that, with the exception of Microsoft, we are not dependent on any single partner for sourcing products.    

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During 2017, sales of Microsoft, Dell and Cisco Systems products accounted for approximately 20%, 12% and 11%, respectively, of our consolidated net sales. No other manufacturer’s products accounted for more than 10% of our consolidated net sales in 2017. Sales of product from our top five manufacturers/publishers as a group (Microsoft, Dell, Cisco Systems, HP Inc. and Lenovo) accounted for approximately 59% of Insight’s consolidated net sales during 2017.

We obtain incentives from certain product manufacturers, software publishers and distribution partners based typically upon the volume of sales or purchases of their products and services. In other cases, such incentives may be in the form of participation in our partner programs, which may require specific services or activities with our clients, discounts, marketing funds, price protection or rebates. Manufacturers and publishers may also provide mailing lists, contacts or leads to us. We believe that these incentives (or partner funding) and other marketing assistance allow us to increase our marketing reach and strengthen our relationships with leading manufacturers and publishers.

We are focused on understanding our partners’ objectives and developing plans and programs to grow our mutual businesses. We have invested in our digital marketing capabilities over the past two years. These digital marketing investments increase the effectiveness of our marketing campaigns and client interactions. Our partners are taking notice, and we are emerging as a leader in our industry as we consistently outpace our competition in digital marketing. We implemented business intelligence tools that enable us to track performance in this area and demonstrate the return on our partners’ investments with us. We measure partner satisfaction regularly and hold quarterly business reviews with our largest partners to review business results from the prior quarter, discuss plans for the future and obtain feedback. Additionally, we host annual partner forums in North America, EMEA and APAC to articulate our plans for the upcoming year.

As we move into new service areas, we may become even more reliant on certain partner relationships. For a discussion of risks associated with our reliance on partners, see “Risk Factors – We rely on our partners for product availability, competitive products to sell and marketing funds and purchasing incentives, which can change significantly in the amounts made available and the requirements year over year,” in Part I, Item 1A of this report.

Our Teammates

As of December 31, 2017, we employed 6,697 teammates, of whom 2,512 were engaged in sales related activities, 2,024 were engaged in management, support services and administration activities, 2,007 were skilled, certified consulting and service delivery professionals and 154 were engaged in distribution activities. Our teammates in the United States are not represented by a labor union. Our workforces in certain foreign countries, such as Germany, have worker representative committees or work councils with which we maintain strong relationships. We believe our relations with our teammates are good, and we have never experienced a labor related work stoppage.

For a discussion of risks associated with our dependence on certain personnel, including sales personnel, see “Risk Factors – We depend on certain key personnel,” in Part I, Item 1A of this report.

Our Seasonality

We experience some seasonal trends in our sales of IT hardware, software and services. For example:

• software sales are typically higher in our second and fourth quarters, particularly the second quarter;

• business clients, particularly larger enterprise businesses in the United States, tend to spend more in our fourth quarter and less in the first quarter;

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• sales to the federal government in the United States are often stronger in our third quarter, while sales in the state and local government and education markets are stronger in our second quarter; and

• sales to public sector clients in the United Kingdom are often stronger in our first quarter.

These trends create overall seasonality in our consolidated results such that sales and profitability are expected to be higher in the second and fourth quarters of the year.

Our Backlog

The majority of our backlog historically has been and continues to be open cancelable purchase orders. We do not believe that backlog as of any particular date is predictive of future results.

Our Intellectual Property

We do not maintain a traditional research and development group, but we do develop and seek to protect a range of intellectual property, including trademarks, service marks, copyrights, domain name rights, trade dress, trade secrets and similar intellectual property, relying for such protection on applicable statutes and common law rights, trade-secret protection and confidentiality and license agreements, as applicable, with teammates, clients, partners and others to protect our intellectual property rights. Our principal trademark is a registered mark, and we also license certain of our proprietary intellectual property rights to third parties. We have registered a number of domain names, applied for registration of other marks in the United States and in certain international jurisdictions, and, from time to time, filed patent applications. We believe our trademarks and service marks, in particular, have significant value, and we continue to invest in the promotion of our trademarks and service marks and in our protection of them.

For a discussion of risks associated with our intellectual property, see “Risk Factors – We may not be able to protect our intellectual property adequately, and we may be subject to intellectual property infringement claims,” in Part I, Item 1A of this report.

Available Information

Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to such reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the reports filed pursuant to Section 16(a) of the Exchange Act are available free of charge on our web site at www.insight.com, as soon as reasonably practicable after we electronically file them with, or furnish them to, the Securities and Exchange Commission. The information contained on our web site is not included as a part of, or incorporated by reference into, this Annual Report on Form 10-K.

Item 1A. Risk Factors

The IT hardware, software and services industry is intensely competitive, and actions of our competitors, including manufacturers and publishers of products we sell, can negatively affect our business. Competition in the industry is based on price, product availability, speed of delivery, credit availability, quality and breadth of product lines, and, increasingly, on the ability to provide services and tailor specific solutions to client needs. Many of our manufacturer and publisher partners are also our competitors, as many sell directly to business customers, particularly larger corporate customers. In addition to the manufacturers and publishers of products we sell, we compete with a large number and wide variety of providers and resellers of IT hardware, software and services. We believe our industry will see further consolidation as product resellers and direct marketers combine operations or acquire or merge with other resellers, service providers and direct marketers to increase efficiency, service capabilities and market share. Moreover, current and potential competitors have established or may establish cooperative relationships among themselves or with third parties to enhance their product and service offerings. Accordingly, it is possible that new competitors or alliances among competitors may emerge and acquire significant market share.

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The competitive landscape in which we operate continues to change as new technologies are developed. While innovation helps our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For instance, while cloud-based solutions present an opportunity for us, cloud-based solutions and technologies that deliver technology solutions as-a-service could increase the amount of sales directly to customers rather than through solutions providers like us, or could reduce the amount of hardware or software we sell, leading to a reduction in our sales and/or profitability. Accordingly, we are dependent on continued innovations by our current vendor partners and our ability to partner with new and emerging technology providers.

Generally, pricing is very aggressive in the industry, and we expect pricing pressures to continue. There can be no assurance that we will be able to negotiate prices as favorable as those negotiated by our competitors or that we will be able to offset the effects of price reductions with an increase in the number of clients, higher net sales, cost reductions, greater sales of services, which are typically at higher gross margins, or otherwise. Price reductions by our competitors that we either cannot or choose not to match could result in an erosion of our market share and/or reduced sales or, to the extent we match such reductions, could result in reduced operating margins or inventory impairment charges, any of which could have a material adverse effect on our business, financial condition and results of operations.

Some of our competitors in each of our operating segments may have greater technical, marketing and other resources than we do. In addition, some of these competitors may be able to respond more quickly to new or changing opportunities, technologies and client requirements. Many current and potential competitors also may have greater name recognition and engage in more extensive promotional activities, offer more attractive terms to their customers and adopt more aggressive pricing policies than we do. Additionally, some of our competitors have higher margins and/or lower operating cost structures, allowing them to price more aggressively. There can be no assurance that we will be able to compete effectively with current or future competitors or that the competitive pressures we face will not have a material adverse effect on our business, financial condition and results of operations.

We rely on our partners for product availability, competitive products to sell and marketing funds and purchasing incentives, which can change significantly in the amounts made available and the requirements year over year. We acquire products for resale both directly from manufacturers and publishers and indirectly through distributors, and the loss of a significant partner relationship could cause a disruption in the availability of products to us. There can be no assurance that manufacturers and publishers will continue to sell or will not limit or curtail the availability of their product to resellers like us. The loss of, or change in business relationship with, any of our key vendor partners could negatively impact our business.

In addition, certain manufacturers, publishers and distributors provide us with substantial incentives in the form of rebates, marketing funds, purchasing incentives, early payment discounts, referral fees and price protections (collectively, “partner funding”). Partner funding is used to offset, among other things, inventory costs, costs of goods sold, marketing costs and other operating expenses. Certain of these funds are based on our volume of sales or purchases, growth rate of net sales or purchases and marketing programs. If we do not meet the goals of these programs or if we are not in compliance with the terms of these programs, there could be a material negative effect on the amount of incentives offered or paid to us by manufacturers and publishers. We continue to experience adverse partner funding program changes that reduce the incentives many partners make available to us and that change the requirements for earning such incentives. If we are unable to react timely to remediate and respond to these changes in partner funding programs of publishers and manufacturers, including the elimination of, or significant reductions in, funding for some of the activities for which we have been compensated in the past, the changes could have a material adverse effect on our business, financial condition and results of operations. This is especially true in connection with the incentive programs of our largest partners: Microsoft, Dell, Cisco Systems, HP Inc. and Lenovo. There can be no assurance that we will continue to receive such incentives in the future.

Changes in the IT industry and/or rapid changes in technology may reduce demand for the IT hardware, software and services we sell or change who makes purchasing decisions for IT hardware, software and services. Our results of operations are influenced by a variety of factors, including the condition of the IT industry, shifts in demand for, or availability of, IT hardware, software, peripherals and services, and industry innovation and the introduction of new products. The IT industry is characterized by rapid technological change and the frequent introduction of new products and changing delivery channels and models, which can decrease demand for current products and services and can disrupt purchasing patterns. If we fail to react in a timely manner to such changes, we may experience lower sales and, with respect to hardware, we may have to record write-downs of obsolete inventory. In addition, in order to satisfy client demand, protect ourselves against product shortages, obtain greater purchasing discounts and react to changes in original equipment manufacturers’ terms and conditions, we may decide to carry inventory of products that may have limited or no return privileges. There can be no assurance that we will be able to avoid losses related to inventory obsolescence on these products. Additionally, if purchasing power within our clients shifts from centralized procurement functions to business units or individual end users and we are unable to react timely to any such changes, these shifts in purchasing power could have a material adverse effect on our business, financial conditions and results of operations.

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The cloud and “as-a-service” models are transforming the IT market and introducing new products, services and competitors to the market. In many cases, these new distribution models allow enterprises to obtain the benefits of commercially licensed, internally operated software with less complexity and lower initial set-up, operational and licensing costs, which increases competition for us. There can be no assurance that we will be able to adapt to, or compete effectively with, current or future distribution channels or competitors or that the competitive pressures we face will not have a material adverse effect on our business, financial condition and results of operations.

The integration and operation of acquired businesses may disrupt our business and create additional expenses, and we may not achieve the anticipated benefits of the acquisitions. Integration of an acquired business involves numerous risks, including assimilation of operations of the acquired business and difficulties in the convergence of IT systems, the diversion of management’s attention from other business concerns, risks of entering markets in which we have had no or only limited direct experience, assumption of unknown or unquantifiable liabilities, the potential loss of key teammates and/or clients, difficulties in completing strategic initiatives already underway in the acquired company, and unfamiliarity with partners of the acquired company, each of which could have a material adverse effect on our business, results of operations and financial condition. The continued integration activities of the acquired businesses into our business is difficult and time consuming, and we may be unable to achieve expected synergies and operating efficiencies over the long term. We cannot assure that these risks or other unforeseen factors will not offset the intended benefits of the acquisitions, in whole or in part.

Our future operating results may fluctuate significantly. Our operating results are highly dependent upon our level of gross profit as a percentage of net sales, which fluctuates due to numerous factors, including changes in prices from partners, changes in the amount and timing of partner funding, volumes of purchases, changes in client mix, management of our cash conversion cycle, the relative mix of products and services sold during the period, general competitive conditions, and strategic product and services pricing and purchasing actions. As a result of significant price competition and our higher concentration of large enterprise clients, our gross margins are low, and we expect them to continue to be low in the future. Increased competition arising from industry consolidation and low demand for certain IT products and services may hinder our ability to maintain or improve our gross margins. These low gross margins magnify the impact of variations in revenue and operating costs on our operating results. In addition, our expense levels are based, in part, on anticipated net sales and the anticipated amount and timing of partner funding, and a portion of our operating expenses is relatively fixed. Therefore, we may not be able to reduce spending quickly enough to compensate for any unexpected net sales shortfall, and we may not be able to reduce our operating expenses as a percentage of revenue to mitigate any further reductions in gross margins in the future. If we cannot proportionately decrease our cost structure, our business, financial condition and results of operations could suffer. In addition, a reduction in the amount of credit granted to us by our partners could increase our need for and cost of working capital and have a material adverse effect on our business, financial condition and results of operations.

There are risks associated with our international operations that are different than the risks associated with our operations in the United States, and our exposure to the risks of a global market could hinder our ability to maintain and expand international operations. Outside of the United States, we have operation centers in Australia, Canada, France, Germany and the United Kingdom, as well as sales offices throughout EMEA and APAC. In the regions in which we do not currently have a physical presence, we serve our clients through strategic relationships. In implementing our international strategy, we may face barriers to entry and competition from local companies and other companies that already have established global businesses, as well as the risks generally associated with conducting business internationally. The success and profitability of international operations are subject to numerous risks and uncertainties, many of which are outside of our control, such as:

• political or economic instability;

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• changes in governmental regulation or taxation (foreign and domestic);

• currency exchange fluctuations;

• changes in import/export laws, regulations and customs and duties (foreign and domestic);

• trade restrictions (foreign and domestic);

• difficulties of conducting business, managing operations, and costs of staffing in certain foreign countries;

• work stoppages or other changes in labor conditions;

• taxes and other restrictions on repatriating foreign profits back to the United States;

• extended payment terms;

• seasonal reductions in business activity in some parts of the world; and

• natural disasters, terrorism, civil unrest and other geopolitical uncertainties.

In addition, changes in policies and/or laws of the United States or foreign governments, including data privacy restrictions, resulting in, among other changes, higher taxation, tariffs or similar protectionist laws, currency conversion limitations, limitations on business operations, or the nationalization of private enterprises could reduce the anticipated benefits of international operations and could have a material adverse effect on our business, financial condition and results of operations.

We have currency exposure arising from both sales and purchases denominated in foreign currencies, including intercompany transactions outside the United States, and we currently conduct limited hedging activities. In addition, some currencies may be subject to limitations on conversion into other currencies, which can limit the ability to otherwise react to rapid foreign currency devaluations. We cannot predict with precision the effect of future exchange-rate fluctuations, and significant rate fluctuations could have a material adverse effect on our business, financial condition and results of operations.

International operations also expose us to currency fluctuations as we translate the financial statements of our foreign operations to U.S. dollars.

General economic conditions, including unfavorable economic conditions in a particular region, business or industry sector, may lead our clients to delay or forgo investments in IT hardware, software and services. Weak economic conditions generally or any broad-based reduction in IT spending adversely affects our business, operating results and financial condition. A prolonged slowdown in the global economy or similar crisis, or in a particular region or business or industry sector, or tightening of credit markets, could cause our clients to have difficulty accessing capital and credit sources, delay contractual payments, or delay or forgo decisions to upgrade or add to their existing IT environments, license new software or purchase products or services (particularly with respect to discretionary spending for hardware, software and services). Such events could have a material adverse effect on our business, financial condition and results of operations. Economic or industry downturns could result in longer payment cycles, increased collection costs and defaults in excess of our expectations. A significant deterioration in our ability to collect on accounts receivable could also impact the cost or availability of financing under our accounts receivable securitization program.

Our sales to our public sector customers are also impacted by government spending policies, budget priorities and revenue levels. An adverse change in government spending policies (including budget cuts at the federal, state and local level), budget priorities or revenue levels could cause our public sector customers to reduce their purchases or to terminate or not renew their contracts with us. These possible actions or the adoption of new or modified procurement regulations or practices could have a material adverse effect our business, financial position and results of operations.

In addition, there continues to be substantial uncertainty regarding the impact of the Referendum on the United Kingdom’s Membership in the European Union (“EU”) (referred to as “Brexit”), advising for the exit of the United Kingdom from the EU. Potential adverse consequences of Brexit such as global market uncertainty, volatility in currency exchange rates, greater restrictions on imports and exports between the United Kingdom and EU countries and increased regulatory complexities could have a negative impact on our business, financial condition and results of operations.

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The acquisition of Datalink has increased our outstanding debt and interest expense and decreased the availability under our financing facilities, all of which could have a material adverse effect on our results of operations and financial condition. To fund our acquisition of Datalink in January 2017, we increased our borrowings under our senior revolving credit facility in the form of an incremental Term Loan A. These additional borrowings will have the effect of increasing our 2018 interest expense and require escalating amortization payments with a balloon payment in 2021. Additionally, our financing facilities have interest rates that vary based on market conditions and on our leverage ratio, which increases our exposure to interest rate fluctuations and may result in greater interest expense than we have forecasted.

Our financing facilities contain various covenants that we must comply with in order to avoid an occurrence of an event of default. The covenants include limitations on the payment of dividends and the requirement that we comply with maximum leverage and minimum fixed charge ratio requirements, comply with a minimum receivables requirement and meet monthly, quarterly and annual reporting requirements. Our ability to maintain compliance with our financial covenants and to make scheduled payments on our financing facilities depends on our financial and operating performance. If we were unable to maintain compliance or to repay the borrowed amounts, the lenders under our financing facilities could declare an event of default and demand payment within a specified period of time.

Breaches in the security of our electronic and other confidential information could materially adversely affect our financial condition and results of operations. We are dependent upon automated information technology processes. Privacy, security, and compliance concerns have continued to increase as technology has evolved to facilitate commerce and as cross-border commerce increases. As part of our normal business activities, we collect and store certain confidential information, including information about teammates and information about partners and clients which may be entitled to protection under a number of regulatory regimes. In the course of normal and customary business practice, we may share some of this information with vendors who assist us with certain aspects of our business. Moreover, the success of our operations depends upon the secure transmission of confidential and personal data over public networks, including the use of cashless payments. Any failure on the part of us or our vendors to maintain the security of data we are required to protect, including via the penetration of our network security and the misappropriation of confidential and personal information, could result in business disruption, damage to our reputation, financial obligations to third parties, fines, penalties, regulatory proceedings and private litigation with potentially large costs, and also result in deterioration in our teammates’, partners’ and clients’ confidence in us and other competitive disadvantages, and thus could have a material adverse effect on our business, financial condition and results of operations. In the past, we have been subject to information security attacks. Although we do not believe the attacks resulted in the misappropriation of sensitive data, we have been, and expect to continue to be, subject to electronic data attacks and threats. Additionally, some of the hardware and software products we resell could have defects or otherwise be the subject of security breaches and other attacks. We would consider the consequences of such attacks to be the responsibility of the respective manufacturers and publishers of such products, however, if such circumstances were to arise, we could be subject to litigation.

Disruptions in our IT systems and voice and data networks could affect our ability to service our clients and cause us to incur additional expenses. We believe that our success to date has been, and future results of operations will be, dependent in large part upon our ability to provide prompt and efficient service to our clients. Our ability to provide that level of service is largely dependent on the ease of use, accuracy, quality and utilization of our IT systems, which affects our ability to manage our sales, client service, distribution, inventories and accounting systems, and the reliability of our voice and data networks and managed services offerings. If our current technology is determined to have a shorter useful life or the value of our current system is impaired, we could incur additional depreciation expense and/or impairment charges. The continuing development of our IT systems is crucial for our success. Accordingly, some of our IT systems are subject to ongoing IT projects designed to streamline or optimize the information systems. There is no guarantee that we will be successful in these efforts at all times or that there will not be implementation or integration difficulties. In addition, a substantial interruption in our IT systems or in our voice and data networks, however caused, could occur and could have a material adverse effect on our business, financial condition and results of operations.

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The failure to comply with the terms and conditions of our commercial and public sector contracts could result in, among other things, damages, fines or other liabilities. Sales to commercial clients are based on stated contractual terms, the terms and conditions on our website or terms contained in purchase orders on a transaction by transaction basis. Sales to public sector clients are derived from sales to federal, state and local governmental departments and agencies, as well as to educational institutions, through open market sales and various contracts and programs. Noncompliance with contract terms, particularly to highly regulated public sector clients, or with government procurement regulations and other requirements could result in fines or penalties against us or termination of contracts, and, in the public sector, could also result in civil, criminal, and administrative liability. With respect to our public sector clients, the government’s remedies may include suspension or debarment. In addition, almost all of our contracts have default provisions, and substantially all of our contracts in the public sector are terminable at any time for convenience of the contracting agency.

We are exposed to risks from legal proceedings and client audits and failure to comply with the laws and regulations applicable to our operations could adversely impact our business, results of operations or cash flows. We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, employment, tort and other litigation. Because of our significant sales to governmental entities, we also are subject to audits by federal, state, international, national, provincial and local authorities in the ordinary course of our business. We also are subject to audits by various vendor partners and large customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts. Current and future litigation, infringement claims, governmental proceedings and investigations, audits or indemnification claims that we face may result in substantial costs and expenses and significantly divert the attention of our management regardless of the outcome. Additionally, our operations are subject to numerous U.S. and foreign laws and regulations in a number of areas including areas of labor and employment, advertising, e-commerce, tax, import and export requirements, anti-corruption, data privacy requirements, anti-competition, and environmental, health, and safety. Compliance with these laws, regulations and similar requirements may be onerous and expensive, and they may be inconsistent from jurisdiction to jurisdiction, further increasing the cost of compliance and doing business, and the risk of noncompliance. We have implemented policies and procedures designed to help ensure compliance with applicable laws and regulations, but there can be no guarantee against teammates, contractors, or agents violating such laws and regulations or our policies and procedures.

We are exposed to accounts receivable risks. We extend credit to our customers for a significant portion of our net sales, typically on 30-day payment terms. We are subject to the risk that our customers may not pay for the products they have purchased, or may pay at a slower rate than we have historically experienced, the risk of which is heightened during periods of economic downturn or uncertainty or, in the case of public sector customers, during periods of budget constraints.

We rely on independent shipping companies for delivery of products and are subject to price increases or service interruptions from these carriers. We generally ship hardware products to our customers by FedEx, United Parcel Service and other commercial delivery services and invoice customers for delivery charges. If we are unable to pass on to our clients future increases in the cost of commercial delivery services, our profitability could be adversely affected. Additionally, strikes, inclement weather, natural disasters or other service interruptions by such shippers could adversely affect our ability to deliver products on a timely basis. Such events could have a material adverse effect on our business, financial condition and results of operations.

We depend on certain key personnel. We rely on key management teammates to execute our strategy to grow profitable market share. The loss of one or more of these leaders, or a failure to attract and retain new executives, could have a material adverse effect on our business, financial condition and results of operations. We also believe that our future success will be largely dependent on our ability to attract and retain highly qualified management, sales, service and technical teammates, and we make significant investments in the training of our sales account executives, architects and services engineers. If we are not able to retain such personnel or to train them quickly enough to meet changing market conditions, we could experience a drop in the overall quality and efficiency of our sales and services teammates, and that could have a material adverse effect on our business, financial condition and results of operations.

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A natural disaster or other adverse occurrence at one of our primary facilities or customer data centers could damage our business. We have warehouse and distribution facilities in the United States and Canada and in the United Kingdom and Germany. If the warehouse and distribution equipment at one of our distribution centers were to be seriously damaged by a natural disaster or other adverse occurrence, we could utilize another distribution center or third-party distributors to ship products to our customers. However, this may not be sufficient to avoid interruptions in our service and may not enable us to meet all of the needs of our customers and would cause us to incur incremental operating costs. In addition, we operate customer data centers and numerous sales offices which may contain both business-critical data and confidential information of our customers. A natural disaster or other adverse occurrence at any of the customer data centers or at any of our major sales offices could negatively impact our business, results of operations or cash flows.

Changes in, interpretations of, or enforcement trends related to tax rules and regulations may adversely affect our effective income tax rates or operating margins and we may be required to pay additional tax assessments. We conduct business globally and file tax returns in various U.S. and foreign tax jurisdictions. Our effective income tax rate could be adversely affected by various factors, many of which are outside of our control, including:

• changes in pre-tax income in various jurisdictions in which we operate that have differing statutory tax rates;

• increases in corporate tax rates and the availability of deductions or credits in the United States and elsewhere;

• changes in tax laws, regulations, and/or interpretations of such tax laws in multiple jurisdictions;

• tax effects related to purchase accounting for acquisitions; and

• resolutions of issues arising from tax examinations and any related interest or penalties.

On December 22, 2017, the U.S. government enacted comprehensive federal tax legislation commonly referred to as the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). The Tax Act makes changes to the U.S. corporate tax rate, business-related deductions and taxation of foreign earnings, among others, that will generally be effective for taxable years beginning after December 31, 2017. By reducing the tax rate, these changes have reduced the value of our net U.S. deferred tax assets, resulting in a significant one-time charge in the current tax year. We are continuing to evaluate the Tax Act and its requirements, as well as its application to our business and its impact on our effective tax rate. At this point, it is unclear how many U.S. states will incorporate these federal law changes, or portions thereof, into their local laws. Our implementation of new practices and processes designed to comply with, and benefit from, the Tax Act and its rules and regulations could require us to make substantial changes to our business practices.

The determination of our worldwide provision for income taxes and other tax liabilities requires estimation, judgment and complex calculations in situations where the ultimate tax determination may not be certain. Our determination of tax liabilities is always subject to review or examination by tax authorities in various jurisdictions. Any adverse outcome of such review or examination could have a material adverse effect on our financial condition and results of operations.

We may not be able to protect our intellectual property adequately, and we may be subject to intellectual property infringement claims. To protect our intellectual property, we rely on copyright, trademark and trade secret laws, unpatented proprietary know-how, and patents, as well as confidentiality, invention assignment, non-solicitation and non-competition agreements. There can be no assurance that these measures will afford us sufficient protection of our intellectual property, and it is possible that third parties may copy or otherwise obtain and use our proprietary information without authorization or otherwise infringe on our intellectual property rights. The disclosure of our trade secrets could impair our competitive position and could have a material adverse effect on our business, financial condition and results of operations. In addition, our registered trademarks and trade names are subject to challenge by third parties. This may affect our ability to continue using those marks and names. Likewise, many businesses are actively investing in, developing and seeking protection for intellectual property in the areas of search, indexing, e-commerce and other Web-related technologies, as well as a variety of on-line business models and methods, all of which are in addition to traditional research and development efforts for IT products and application software, and non-practicing entities continue to invest in acquiring patent portfolios for the purpose of turning the portfolios into income-generating assets, whether through licensing campaigns or litigation. If there is a determination that we have infringed the proprietary rights of others, we could incur substantial monetary liability, be forced to stop selling infringing products or providing infringing services, be required to enter into costly royalty or licensing agreements, if available, or be prevented from using the rights, which could force us to change our business practices or hardware, software or services offerings in the future. These types of claims and challenges could have a material adverse effect on our business, financial condition and results of operations.

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Item 1B. Unresolved Staff Comments

Not applicable.

Item 2. Properties

Our principal executive offices are located in Tempe, Arizona. We believe that our facilities are suitable and adequate for our present purposes, and we anticipate that we will be able to extend our existing leases on terms satisfactory to us or, if necessary, to locate substitute facilities on acceptable terms. At December 31, 2017, we owned or leased approximately 1.4 million square feet of office and warehouse space, and, while approximately 69% of the square footage is in the United States, we own or lease office and warehouse facilities in Canada and in 10 countries in EMEA and we lease office facilities in five countries in APAC.

Information about significant sales, distribution, services and administration facilities in use as of December 31, 2017 is summarized in the following table:

Operating Segment	Location	Primary Activities	Own or Lease
North America	Tempe, Arizona, USA	Executive Offices, Sales and Administration and Network Operations Center	Own
	Tempe, Arizona, USA	Client Support Center	Own
	Addison, Illinois, USA	Sales and Administration	Lease
	Eden Prairie, Minnesota, USA	Sales, Services and Administration	Lease
	Hanover Park, Illinois, USA	Services, Distribution and Administration	Lease
	Plano, Texas, USA	Sales and Administration	Lease
	Austin, Texas, USA	Sales and Administration	Lease
	Liberty Lake, Washington, USA	Sales and Administration	Lease
	Tampa, Florida, USA	Sales and Administration	Lease
	Conway, Arkansas, USA	Sales and Administration	Lease
	Winnipeg, Manitoba, Canada	Sales and Administration	Lease
	Montreal, Quebec, Canada	Sales and Administration	Own
	Montreal, Quebec, Canada	Distribution	Lease
EMEA	Sheffield, United Kingdom	Sales and Administration	Own
	Sheffield, United Kingdom	Distribution	Lease
	Uxbridge, United Kingdom	Sales and Administration	Lease
	Garching, Germany	Sales and Administration	Lease
	Frankfurt, Germany	Sales and Administration	Lease
	Frankfurt, Germany	Distribution	Lease
	Vélizy, France	Sales and Administration	Lease
APAC	Sydney, New South Wales, Australia	Sales and Administration	Lease
	Perth, Australia	Sales and Administration	Lease

In addition to those listed above, we have leased sales offices in various cities across North America, EMEA and APAC. These properties are not included in the table above. Substantially all of our owned properties secure our senior revolving credit facility (“revolving facility”). A portion of the client support center that we own in Tempe, Arizona included in the table above is currently leased to Revana, formerly known as Direct Alliance Corporation, a discontinued operation that was sold to a third party in 2006. For additional information on operating leases, see Note 7 to the Consolidated Financial Statements in Part II, Item 8 of this report.

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Item 3. Legal Proceedings

For a discussion of legal proceedings, see “Legal Proceedings” in Note 17 to the Consolidated Financial Statements in Part II, Item 8 of this report, which is incorporated by reference herein.

Item 4. Mine Safety Disclosures

Not applicable.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock trades under the symbol “NSIT” on The Nasdaq Global Select Market. The following table shows, for the calendar quarters indicated, the high and low sales prices per share for our common stock as reported on The Nasdaq Global Select Market.

	Common Stock
Year 2017	High Price		Low Price
Fourth Quarter	$	46.68	$	35.26
Third Quarter		47.95		37.91
Second Quarter		53.19		39.67
First Quarter		46.00		35.44
Year 2016
Fourth Quarter	$	41.81	$	28.15
Third Quarter		32.77		24.23
Second Quarter		29.39		23.31
First Quarter		28.96		18.26

As of February 15, 2018, we had 35,836,320 shares of common stock outstanding held by 56 stockholders of record. This figure does not include an estimate of the number of beneficial holders whose shares are held of record by brokerage firms and clearing agencies.

We have never paid a cash dividend on our common stock, and we currently do not intend to pay any cash dividends in the foreseeable future. Our revolving facility and our accounts receivable securitization financing facility contain restrictions on the payment of cash dividends.

Issuer Purchases of Equity Securities

We did not repurchase shares of our common stock during the quarter ended December 31, 2017.

See further information on our share repurchase programs in Note 16 to the Consolidated Financial Statements in Part II, Item 8 of this report.

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Stock Price Performance Graph

Set forth below is a graph comparing the percentage change in the cumulative total stockholder return on our common stock with the cumulative total return of the Nasdaq US Benchmark TR Index (Market Index) and the Nasdaq US Benchmark Computer Hardware TR Index (Industry Index). The graph assumes that $100 was invested on December 31, 2012 in our common stock and in each of the two Nasdaq indices, and that, as to such indices, dividends were reinvested. We have not, since our inception, paid any cash dividends on our common stock. Historical stock price performance shown on the graph is not necessarily indicative of future price performance.

	Dec. 31, 2012		Dec. 31, 2013		Dec. 31, 2014		Dec. 31, 2015		Dec. 31, 2016		Dec. 31, 2017
Insight Enterprises, Inc. Common Stock (NSIT)	$	100.00	$	130.74	$	149.05	$	144.62	$	232.82	$	220.44
Nasdaq US Benchmark TR Index (Market Index)		100.00		133.48		150.12		150.84		170.46		206.91
Nasdaq US Benchmark Computer Hardware TR Index (Industry Index)		100.00		117.65		159.48		145.20		167.36		240.72

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Item 6. Selected Financial Data

The following selected consolidated financial data should be read in conjunction with our Consolidated Financial Statements and the Notes thereto in Part II, Item 8 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of this report. The selected consolidated financial data presented below under the captions “Consolidated Statements of Operations Data” and “Consolidated Balance Sheet Data” as of and for each of the years in the five-year period ended December 31, 2017 is derived from our audited consolidated financial statements. The consolidated financial statements as of December 31, 2017 and 2016, and for each of the years in the three-year period ended December 31, 2017, which have been audited by KPMG LLP, our independent registered public accounting firm, are included in Part II, Item 8 of this report.

	Years Ended December 31,
	2017			2016			2015			2014			2013
		(in thousands, except per share data)
Consolidated Statements of Operations Data (1)
Net sales	$	6,703,623		$	5,485,515		$	5,373,090		$	5,316,229		$	5,144,347
Costs of goods sold		5,785,053			4,742,413			4,656,758			4,603,826			4,445,460
Gross profit		918,570			743,102			716,332			712,403			698,887
Operating expenses:
Selling and administrative expenses		723,328			585,243			584,906			576,967			564,910
Severance and restructuring expenses		9,002			4,580			4,907			4,433			12,740
Loss on sale of foreign entity		3,646			—			—			—			—
Acquisition-related expenses		3,329			4,447			—			—			—
Earnings from operations		179,265			148,832			126,519			131,003			121,237
Non-operating (income) expense:
Interest income		(1,209	)		(1,066	)		(783	)		(1,062	)		(1,230	)
Interest expense		19,174			8,628			7,224			6,019			6,337
Net foreign currency exchange loss (gain)		855			522			(393	)		327			194
Other expense, net		1,347			1,290			1,295			1,347			1,412
Earnings before income taxes		159,098			139,458			119,176			124,372			114,524
Income tax expense		68,415			54,768			43,325			48,688			43,503
Net earnings	$	90,683		$	84,690		$	75,851		$	75,684		$	71,021
Net earnings per share:
Basic	$	2.54		$	2.35		$	2.00		$	1.84		$	1.65
Diluted	$	2.50		$	2.32		$	1.98		$	1.83		$	1.64
Shares used in per share calculations:
Basic		35,741			36,102			37,984			41,062			43,012
Diluted		36,207			36,438			38,275			41,358			43,289

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	December 31,
	2017		2016		2015		2014		2013
	(in thousands)
Consolidated Balance Sheet Data
Working capital	$	804,369	$	544,943	$	543,534	$	565,559	$	526,423
Total assets		2,685,651		2,219,300		2,014,017		1,947,838		1,868,611
Short-term debt, including capital leases and other financing obligations(2)		16,592		480		1,535		766		217
Long-term debt, including capital leases and other financing obligations(2)		296,576		40,251		89,000		62,535		66,949
Stockholders’ equity		843,469		713,443		685,742		721,231		716,918
Cash dividends declared per common share		—		—		—		—		—

⁽¹⁾ Our consolidated statements of operations data includes results of the following acquisitions from their respective dates of acquisition: Caase.com from September 26, 2017, Datalink from January 6, 2017, Ignia from September 1, 2016 and BlueMetal from October 1, 2015.

⁽²⁾ Excludes obligations under our inventory financing facility of $319.5 million, $154.9 million, $106.3 million, $122.8 million and $115.3 million as of December 31, 2017, 2016, 2015, 2014 and 2013, respectively. We do not include these obligations in total debt because we have not in the past incurred, and in the future do not expect to incur, any interest payments due under this facility. These amounts are classified separately as accounts payable-inventory financing facility on our consolidated balance sheets. See Note 5 to the Consolidated Financial Statements in Part II, Item 8 of this report.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of our operations should be read in conjunction with the Consolidated Financial Statements and notes thereto included in Part II, Item 8 of this report. Our actual results could differ materially from those contained in forward-looking statements due to a number of factors, including those discussed in “Risk Factors” in Part I, Item 1A and elsewhere in this report. Additionally, any references to our “core” business exclude Datalink’s results subsequent to the Datalink acquisition.

Overview

We are a Fortune 500 global IT provider helping businesses of all sizes – from small and medium sized firms to worldwide enterprises, governments, schools and health care organizations – define, architect, implement and manage Intelligent Technology Solutions^TM in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”). We empower our clients to manage their IT environments so they can drive meaningful business outcomes today and transform their operations for tomorrow. Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services.

Full year 2017 financial and operational highlights included the following:

• In North America:

• We completed the acquisition of Datalink on January 6, 2017 and completed the IT systems and back office integration activities by mid-year. We achieved expense synergies ahead of our expectations and are pleased with the overall financial results of the business in its first year as part of Insight;

• We gained hardware market share from competitors according to third-party data, reflecting strong growth in data center solutions as well as devices; and

• We continued our focus on tight expense control across the business.

• In EMEA:

• We continued to transform into a cloud and solutions business, invested in technical and pre-sales and service delivery teammates focused on cloud technologies and grew our services sales by 15%;

• We sold our non-strategic business in Russia;

• We were named #1 in Microsoft Azure consumption in the region for 2017; and

• We acquired Caase.com in the third quarter, which further enhances our technical capabilities around Office 365 and Azure in the region.

• In APAC:

• We generated double digit gross profit growth; and

• We invested significantly to support cloud and services sales in Australia, which we expect will improve our growth trends in 2018.

On a consolidated basis, for the year ended December 31, 2017, our net sales of $6.7 billion increased 22% compared to 2016. This increase reflects growth of 20% in our core business and the addition of Datalink to our results of operations beginning January 6, 2017. As a result, for the first time in the Company’s history, net sales from the provision of services approximated 10%. Our gross profit increased faster than sales, increasing by 24%, or $175.5 million, compared to 2016, also up 24% year over year excluding the effects of fluctuating foreign currency exchange rates. Consolidated gross margin improved approximately 20 basis points to 13.7% of net sales in 2017. This increase reflects solid growth in net sales and gross profit in our core business combined with the addition of Datalink. Selling and administrative expenses increased $138.1 million, or 24%, in 2017 compared to 2016. The year over year change reflects the addition of Datalink and an increase of 5% in selling and administrative expenses in our core business. We reported earnings from operations of $179.3 million in 2017, an increase of 20% compared to the prior year, which represented 2.7% of net sales, consistent with the prior year. Our effective tax rate in 2017 was 43.0%, driven by the effects of U.S. federal tax reform enacted in December 2017. This higher tax rate in 2017 compares to our effective tax rate of 39.3% in 2016 and 36.4% in 2015. Net earnings and diluted net earnings per share were $90.7 million and $2.50, respectively, in 2017. In 2016, we reported net earnings of $84.7 million and diluted net earnings per share of $2.32. In 2015, we reported net earnings of $75.9 million and diluted net earnings per share of $1.98.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

The results of operations for 2017 include the following items:

• the results of the acquisitions of Caase.com and Datalink, from their respective acquisition dates;

• the loss on the sale of our Russia business totaling $3.6 million;

• transaction costs totaling $3.3 million, $2.5 million net of tax, associated with the acquisitions of Caase.com and Datalink;

• severance and restructuring expenses of $9.0 million, $7.3 million net of tax; and

• incremental income tax expense related to U.S. federal tax reform of $13.4 million.

The results of operations for 2016 include the following items:

• the results of the acquisition of Ignia effective September 1, 2016;

• transaction costs totaling $4.4 million, $4.2 million net of tax, associated with the acquisitions of Ignia and Datalink;

• severance and restructuring expenses of $4.6 million, $3.3 million net of tax;

• a gain of $338,000 on the sale of our Bloomingdale, Illinois real estate; and

• the repurchase of approximately 1.9 million shares of the Company’s common stock for $50 million.

The results of operations for 2015 include the following items:

• the results of the acquisition of BlueMetal effective October 1, 2015;

• severance and restructuring expenses of $4.9 million, $4.3 million net of tax;

• an impairment loss of $800,000 to further reduce the carrying amount of our previously owned real estate in Bloomingdale, Illinois to its estimated fair value less costs to sell; and

• the repurchase of approximately 3.3 million shares of the Company’s common stock for $91.8 million.

Throughout the “Overview” and “Results of Operations” sections of “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we refer to changes in net sales, gross profit, selling and administrative expenses and earnings from operations on a consolidated basis and in North America, EMEA and APAC excluding the effects of fluctuating foreign currency exchange rates. In computing these amounts and percentages, we compare the current period amount as translated into U.S. dollars under the applicable accounting standards to the prior period amount in local currency translated into U.S. dollars utilizing the weighted average translation rate for the current period.

Net of tax amounts referenced above were computed using the statutory tax rate for the taxing jurisdictions in the operating segment in which the related expenses were recorded, adjusted for the effects of valuation allowances on net operating losses in certain jurisdictions.

During 2017, we used $305.4 million in operating activities, including approximately $186.9 million, net of cash and cash equivalents acquired, utilized to fund the acquisitions of Datalink and Caase.com. We ended the year with $105.8 million of cash and cash equivalents and $307.9 million of debt outstanding under our long-term debt facilities.

Details about segment results of operations can be found in Note 20 to the Consolidated Financial Statements in Part II, Item 8 of this report.

Our discussion and analysis of financial condition and results of operations is intended to assist in the understanding of our consolidated financial statements, including the changes in certain key items in those consolidated financial statements from year to year and the primary factors that contributed to those changes, as well as how certain critical accounting estimates affect our consolidated financial statements.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

Critical Accounting Estimates

General

Our consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). For a summary of significant accounting policies, see Note 1 to the Consolidated Financial Statements in Part II, Item 8 of this report. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, net sales and expenses. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results, however, may differ from our estimates. Members of our senior management have discussed the critical accounting estimates and related disclosures with the Audit Committee of our Board of Directors.

We consider the following to be our critical accounting estimates used in the preparation of our consolidated financial statements:

Sales Recognition

Sales are recognized when title and risk of loss are passed to the client, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable and collectibility is reasonably assured. Our standard sales terms are F.O.B. shipping point or equivalent, at which time title and risk of loss have passed to the client. However, because we either (i) have a general practice of covering client losses while products are in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) have specifically stated F.O.B. destination contractual terms with the client, delivery is not deemed to have occurred until the point in time when the product is received by the client. We make provisions for estimated product returns that we expect to occur under our return policy based upon historical return rates.

We leverage drop-shipment arrangements with many of our partners and suppliers to deliver products to our clients without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs. We recognize revenue for drop-shipment arrangements on a gross basis when the product is received by the client. We recognize revenue on a gross basis as the principal in the transaction because we control the transaction as the primary obligor for product fulfillment in the arrangement, we assume inventory risk if the product is returned by the client, we set the price of the product charged to the client, we assume credit risk for the amounts invoiced, and we work closely with our clients to determine their hardware and software specifications.

Revenue is recognized from software sales when clients acquire the right to use or copy software under license, but in no case prior to the commencement of the term of the initial software license agreement, provided that all other revenue recognition criteria have been met (i.e., evidence of the arrangement exists, the fee is fixed or determinable and collectibility of the fee is probable).

We sell certain third-party service contracts and software maintenance and cloud or software-as-a-service subscription products for which we are not the primary obligor. These sales do not meet the criteria for gross sales recognition and, thus, are recorded on a net sales recognition basis. As we enter into contracts with third-party service providers or vendors and our clients, we evaluate whether the subsequent sales of such services should be recorded as gross sales or net sales. We determine whether we act as a principal in the transaction and assume the risks and rewards of ownership or if we are simply acting as an agent or broker. Under gross sales recognition, the selling price is recorded in sales and our cost to the third-party service provider or vendor is recorded in costs of goods sold. Under net sales recognition, the cost to the third-party service provider or vendor is recorded as a reduction to sales, resulting in net sales equal to the gross profit on the transaction, and there are no costs of goods sold.

We recognize revenue for sales of services ratably over the time period over which the service will be provided if there is no discernible pattern of recognition of the cost to perform the service. Billings for such services that are made in advance of the related revenue recognized are recorded as deferred revenue and recognized as revenue ratably over the billing coverage period. Revenue from certain arrangements that allow for the use of a product or service over a period of time without taking possession of software are also accounted for ratably over the time period over which the service will be provided.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred as the services are performed and amounts are earned. Net sales for these service engagements are not a significant portion of our consolidated net sales.

Additionally, we sell certain professional services contracts on a fixed fee basis. Revenues for fixed fee professional services contracts are recognized based on the ratio of costs incurred to total estimated costs. Net sales for these service contracts are not a significant portion of our consolidated net sales.

In certain arrangements, we may provide a combination of hardware and software products as well as services. Services that are performed by us in conjunction with hardware and software sales that are completed in our facilities prior to shipment of the product are recognized upon delivery, when title passes to the client, for the hardware sale. Net sales of services that are performed at client locations are primarily service-only contracts and are recorded as sales when the services are performed. The total consideration for an arrangement with multiple deliverables is allocated to all deliverables that represent a separate unit of accounting using the relative selling price method.

Partner Funding

We receive payments and credits from partners, including consideration pursuant to volume sales incentive programs, volume purchase incentive programs and shared marketing expense programs. Partner funding received pursuant to volume sales incentive programs is recognized as it is earned as a reduction to costs of goods sold. Partner funding received pursuant to volume purchase incentive programs is allocated as a reduction to inventories based on the applicable incentives earned from each partner and is recorded in costs of goods sold as the related inventory is sold. Partner funding received pursuant to shared marketing expense programs is recorded as it is earned as a reduction of the related selling and administrative expenses in the period the program takes place if the consideration represents a reimbursement of specific, incremental, identifiable costs. Consideration that exceeds the specific, incremental, identifiable costs is classified as a reduction of costs of goods sold. Changes in estimates of anticipated achievement levels under individual partner programs could have a material effect on our results of operations and our cash flows.

See Note 1 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of our accounting policies related to partner funding.

Valuation of Long-Lived Assets Including Purchased Intangible Assets and Goodwill

We review property, plant and equipment and purchased intangible assets for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. If such events or changes in circumstances indicate a possible impairment, our asset impairment review assesses the recoverability of the assets based on the estimated undiscounted future cash flows expected to result from the use of the asset or the asset group plus net proceeds expected from disposition of the asset or the asset group (if any) and compares that value to the carrying value. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. If the carrying value exceeds the undiscounted future cash flows, an impairment loss is recognized for the difference between fair value and the carrying amount. This approach uses our estimates of future market growth, forecasted net sales and costs, expected periods the assets will be utilized and appropriate discount rates.

We perform an annual review of our goodwill in the fourth quarter of every year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. We continually assess whether any indicators of impairment exist, and that assessment requires a significant amount of judgment. Events or circumstances that could trigger an impairment review include a significant adverse change in legal factors or in the business climate, unanticipated competition, significant changes in the manner of our use of the acquired assets or the strategy for our overall business, significant negative industry or economic trends, significant declines in our stock price for a sustained period or significant underperformance relative to expected historical or projected future cash flows or results of operations. Any adverse change in these factors, among others, could have a significant effect on the recoverability of goodwill and could have a material effect on our consolidated financial statements.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

The goodwill impairment test is performed at the reporting unit level. A reporting unit is an operating segment or one level below an operating segment (referred to as a “component”). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and management of the segment regularly reviews the operating results of that component. When two or more components of an operating segment have similar economic characteristics, the components may be aggregated and deemed a single reporting unit. An operating segment shall be deemed to be a reporting unit if all of its components are similar, if none of its components is a reporting unit, or if the segment comprises only a single component. Insight has three reporting units, which are equivalent to our operating segments.

We may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform a quantitative goodwill impairment test. Otherwise, the goodwill impairment test is not required. In completing a quantitative test for a potential impairment of goodwill, we compare the estimated fair value of each reporting unit in which the goodwill resides to its book value, including goodwill. Management must apply judgment in determining the estimated fair value of our reporting units. Multiple valuation techniques can be used to assess the fair value of the reporting unit, including the market and income approaches. All of these techniques include the use of estimates and assumptions that are inherently uncertain. Changes in these estimates and assumptions could materially affect the determination of fair value or goodwill impairment, or both. These estimates and assumptions primarily include, but are not limited to, an appropriate control premium in excess of the market capitalization of the Company, future market growth, forecasted sales and costs and appropriate discount rates. Due to the inherent uncertainty involved in making these estimates, actual results could differ from those estimates. Management evaluates the merits of each significant assumption, both individually and in the aggregate, used to determine the fair value of the reporting units. If the estimated fair value exceeds book value, goodwill is considered not to be impaired. If the carrying amount of the reporting unit exceeds its fair value, then an impairment charge is recognized for the amount by which the carrying value exceeds the fair value. To ensure the reasonableness of the estimated fair values of our reporting units, we perform a reconciliation of our total market capitalization to the estimated fair value of all of our reporting units.

See further information on the carrying value of goodwill in Note 3 to the Consolidated Financial Statements in Part II, Item 8 of this report.

Income Taxes

In December 2017, U.S. federal tax reform was enacted as part of the Tax Act. The change in tax law required a remeasurement of our deferred tax balances. In addition, the change in tax law included provisions requiring mandatory deemed repatriation of undistributed foreign earnings. Due to the enactment date and complexities of the new law, we have not completed our accounting related to these items. In accordance with Staff Accounting Bulletin 118, issued on December 22, 2017, we have concluded that the U.S. income taxes attributable to the remeasurement of U.S. deferred income taxes, the mandatory deemed repatriation provision and the state tax effects of these items are provisional amounts.

We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. We consider past operating results, future market growth, forecasted earnings, historical and projected taxable income, the mix of earnings in the jurisdictions in which we operate, prudent and feasible tax planning strategies and statutory tax law changes in determining the need for a valuation allowance. If we were to determine that it is more likely than not that we would not be able to realize all or part of our net deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to earnings in the period such determination is made. Likewise, if we later determine that it is more likely than not that all or part of the net deferred tax assets would be realized, then all or part of the previously provided valuation allowance would be reversed.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

We establish liabilities for potentially unfavorable outcomes associated with uncertain tax positions taken on specific tax matters. These liabilities are based on management’s assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. There may be differences between the anticipated and actual outcomes of these matters that may result in subsequent recognition or derecognition of a tax position based on all the available information at the time. If material adjustments are warranted, it could affect our effective tax rate.

Additional information about recent U.S. federal tax reform, the valuation allowance and uncertain tax positions can be found in Note 11 to the Consolidated Financial Statements in Part II, Item 8 of this report.

Contingencies

From time to time, we are subject to potential claims and assessments from third parties. We are also subject to various government agency, client and partner audits. We continually assess whether or not such claims have merit and warrant accrual. An accrual is made if it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Such estimates are subject to change and may affect our results of operations and our cash flows. Additional information about contingencies can be found in Note 17 to the Consolidated Financial Statements in Part II, Item 8 of this report.

RESULTS OF OPERATIONS

The following table sets forth certain financial data as a percentage of net sales for the years ended December 31, 2017, 2016 and 2015:

	2017			2016			2015
Net sales		100.0	%		100.0	%		100.0	%
Costs of goods sold		86.3			86.5			86.7
Gross profit		13.7			13.5			13.3
Operating expenses:
Selling and administrative expenses		10.8			10.7			10.9
Severance and restructuring expenses, loss on sale of foreign entity and acquisition-related expenses		0.2			0.1			0.0
Earnings from operations		2.7			2.7			2.4
Non-operating expense, net		0.3			0.2			0.2
Earnings before income taxes		2.4			2.5			2.2
Income tax expense		1.0			1.0			0.8
Net earnings		1.4	%		1.5	%		1.4	%

During the year ended December 31, 2017, our consolidated net sales from the provision of services was approximately 10% of net sales. Accordingly, for the year ended December 31, 2017, we began reporting, on the face of our consolidated statement of operations, net sales from the provision of services and the related costs of goods sold separately from net sales of products and the related costs of goods. For comparability purposes, the presentation of net sales and costs of goods sold for the years ended December 31, 2016 and 2015 has been revised to conform to the current year presentation. These changes in presentation had no effect on previously reported total net sales, total costs of goods sold or gross profit amounts.

In conjunction with this change in presentation, because fees earned from activities reported net are considered services revenues, we reclassified certain revenue streams for which we act as the agent in the transaction to net sales from services. Previously, we included these net revenue streams within our software and, to a lesser extent, hardware sales mix categories based on the type of product being sold (e.g., fees earned for the sale of software maintenance and certain software licenses were included in software sales and fees earned for the sale of certain third-party provided training were included in hardware sales when we historically disclosed and analyzed our sales mix). For comparability purposes, the sales mix among our hardware, software and services categories for the years ended December 31, 2016 and 2015 have been reclassified to conform to the current year presentation. Such reclassifications had no effect on previously reported net sales amounts.

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AND RESULTS OF OPERATIONS (continued)

Our gross profit across the business and related to product versus services sales are, and will continue to be, impacted by partner incentives, which can change significantly in the amounts made available and the related product or services sales being incentivized by the partner. These changes could impact our results of operations to the extent we are unable to remediate and respond to them.

2017 Compared to 2016

Net Sales. Net sales increased 22%, or $1.2 billion, in 2017 compared to 2016. Net sales of products (hardware and software) increased 21% and net sales of services increased 36% in 2017 compared to 2016 (as reclassified). Our net sales by operating segment for 2017 and 2016 were as follows (dollars in thousands):

	2017		2016		% Change
North America	$	5,181,734	$	3,971,828		30	%
EMEA		1,355,416		1,338,560		1	%
APAC		166,473		175,127		(5	%)
Consolidated	$	6,703,623	$	5,485,515		22	%

Net sales in North America increased 30%, or $1.2 billion, in 2017 compared to 2016, including 17% year over year growth in our core business driven by higher volume of sales from new and existing clients, and the addition of Datalink, which reported $524.3 million in net sales in 2017. Net sales of hardware, software and services increased 37%, 14% and 40%, respectively, year over year. The improvement in net sales in the hardware category reflects higher volume of sales to large enterprise clients and was due primarily to strong growth in data center solutions as well as client devices. Strong growth in our core business was complemented by the addition of Datalink, which accounted for approximately 29% of the year over year growth in the hardware category. The increase in the software category was also affected by the acquisition of Datalink, which accounted for approximately 70% of the year over year increase. The increase in services net sales reflects the addition of Datalink to our business, offset partially by declines in technical services projects in our core business in 2017 compared to 2016. Services net sales during 2017 also reflected the continued trend toward higher sales of cloud-based offerings and a higher mix of software maintenance sales that are recorded on a net sales recognition basis, with net sales equal to the gross profit on the transaction. Our net sales by offering category for North America for 2017 and 2016 (as reclassified), were as follows (dollars in thousands):

	North America
Sales Mix	2017		2016		% Change
			(As Reclassified)
Hardware	$	3,352,355	$	2,454,889		37	%
Software		1,310,118		1,146,808		14	%
Services		519,261		370,131		40	%
	$	5,181,734	$	3,971,828		30	%

In North America, fees earned from activities reported on a net basis of $270,000 and $87,984,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, were reclassified to services to conform to the current year presentation.

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AND RESULTS OF OPERATIONS (continued)

Net sales in EMEA increased 1%, or $16.9 million, in 2017 compared to 2016. Excluding the effects of fluctuating foreign currency exchange rates, net sales increased 2% in 2017 compared to 2016. Net sales of hardware and services were up 11% and 15%, respectively, year over year, while net sales of software declined 7% year to year. The increase in hardware net sales was due primarily to higher volume sales of client devices, storage and networking solutions to public sector clients. The increase in services net sales was due primarily to increased sales of license consulting services and partner delivered services to new and existing clients across the region. In addition, a higher volume of sales of software maintenance and cloud subscription products that are recorded on a net sales recognition basis, with net sales equal to the gross profit on the transaction, are included in the services category. The decrease in software net sales was driven by a single significant transaction during the prior year period affecting the year over year comparison. Our net sales by offering category for EMEA for 2017 and 2016 (as reclassified), were as follows (dollars in thousands):

	EMEA
Sales Mix	2017		2016		% Change
			(As Reclassified)
Hardware	$	536,500	$	481,505		11	%
Software		710,452		762,427		(7	%)
Services		108,464		94,628		15	%
	$	1,355,416	$	1,338,560		1	%

In EMEA, fees earned from activities reported on a net basis of $48,586,000 that were previously reported as part of our software product category in 2016 were reclassified to services to conform to the current year presentation.

Net sales in APAC decreased 5%, or $8.7 million, in 2017 compared to 2016. Excluding the effects of fluctuating foreign currency exchange rates, net sales decreased 7% in 2017 compared to 2016. Increases in hardware and services net sales year over year were offset by a decrease in software net sales during 2017 compared to 2016, resulting from the timing of a single client agreement in the public sector that historically transacted in the fourth quarter but instead transacted in the first quarter of 2018 this year. The growth in hardware net sales was primarily due to our continued expansion of hardware offerings in this market. The growth in services net sales resulted from the contributions of Ignia, as well as a higher volume of sales of software maintenance and cloud subscriptions products that are recorded on a net sales recognition basis in 2017 compared to 2016. Our net sales by offering category for APAC for 2017 and 2016 (as reclassified), were as follows (dollars in thousands):

	APAC
Sales Mix	2017		2016		% Change
			(As Reclassified)
Hardware	$	27,907	$	18,916		48	%
Software		101,412		132,718		(24	%)
Services		37,154		23,493		58	%
	$	166,473	$	175,127		(5	%)

In APAC, fees earned from activities reported on a net basis of $9,000 and $10,991,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, were reclassified to services to conform to the current year presentation.

Net sales by category for North America, EMEA and APAC were as follows for 2017 and 2016 (as reclassified):

	North America						EMEA						APAC
Sales Mix	2017			2016			2017			2016			2017			2016
Hardware		65	%		62	%		40	%		36	%		17	%		11	%
Software		25	%		29	%		52	%		57	%		61	%		76	%
Services		10	%		9	%		8	%		7	%		22	%		13	%
		100	%		100	%		100	%		100	%		100	%		100	%

Gross Profit. Gross profit increased 24%, or $175.5 million, in 2017 compared to 2016, with gross margin increasing approximately 20 basis points to 13.7% of net sales. Our gross profit and gross profit as a percent of net sales by operating segment for 2017 and 2016 were as follows (dollars in thousands):

	2017		% of Net Sales			2016		% of Net Sales
North America	$	691,677		13.3	%	$	525,481		13.2	%
EMEA		190,310		14.0	%		185,687		13.9	%
APAC		36,583		22.0	%		31,934		18.2	%
Consolidated	$	918,570		13.7	%	$	743,102		13.5	%

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AND RESULTS OF OPERATIONS (continued)

North America’s gross profit in 2017 increased 32% compared to 2016, and as a percentage of net sales, gross margin increased by approximately 10 basis points year over year. The year over year increase in gross margin was primarily attributable to a net increase in product margin, which includes partner funding and freight, of 30 basis points year over year. The net increase in product margin was due primarily to improvements in hardware and software product margin during 2017 compared to 2016 due to the acquisition of Datalink, which includes sales of data center products at higher gross margins then in our core business. The positive effect of the Datalink acquisition was partially offset by lower product margin in our core business due to a higher mix of business with large enterprise clients, where margins tend to be lower than other client groups. Services margin improvement year over year of 11 basis points was driven by an increase in margin generated by sales of warranty services during 2017 compared to 2016, which was driven by the acquisition of Datalink. These increases in margin were offset partially by a decrease in margin from lower fees from enterprise software agreements of 23 basis points during 2017 compared to 2016. The year over year comparison was also affected by a $2.2 million insurance settlement recognized during 2016 as a reduction of cost of sales due to the nature of the related insured loss previously recorded.

EMEA’s gross profit in 2017 increased 2% compared to 2016. Excluding the effects of fluctuating foreign currency exchange rates, gross profit was up 4% in 2017 compared to 2016. As a percentage of net sales, gross margin increased by approximately 10 basis points year over year. The year over year improvement in gross margin was primarily attributable to a 60 basis point increase in services margin due to a higher volume of higher margin services net sales during 2017 compared to 2016 as well as the positive effect on services margin that resulted from the higher volume of sales that were recorded on a net sales recognition basis in 2017 compared to 2016. The improvement in gross margin resulting from higher margin services net sales was partially offset by a net decrease in product margin, which includes partner funding and freight, of 50 basis points during 2017 compared to 2016. The decline in product margin primarily resulted from lower margins on large enterprise and public sector deals transacted during 2017.

APAC’s gross profit increased 15% in 2017 compared to 2016, with gross margin increasing to 22.0% in 2017 from 18.2% in 2016. Excluding the effects of fluctuating foreign currency exchange rates, gross profit increased 13% in 2017 compared to 2016. The improvement in gross margin in 2017 compared to 2016 was due primarily to the positive effect on services margin that results from the higher volume of sales that are recorded on a net sales recognition basis, an increase in the mix of higher margin services net sales and the margin contribution from increases in hardware net sales during 2017 compared to 2016.

Operating Expenses.

Selling and Administrative Expenses. Selling and administrative expenses increased $138.1 million in 2017 compared to 2016. Selling and administrative expenses increased approximately 10 basis points as a percentage of net sales in 2017 compared to 2016.

Selling and administrative expenses as a percent of net sales by operating segment for 2017 and 2016 were as follows (dollars in thousands):

	2017		% of Net Sales			2016		% of Net Sales
North America	$	530,792		10.2	%	$	401,316		10.1	%
EMEA		164,305		12.1	%		160,269		12.0	%
APAC		28,231		17.0	%		23,658		13.5	%
Consolidated	$	723,328		10.8	%	$	585,243		10.7	%

North America’s selling and administrative expenses increased 32%, or $129.5 million, in 2017 compared to 2016, and increased approximately 10 basis points year over year as a percentage of net sales to 10.2% of net sales in 2017. The increase in expenses reflects the addition of Datalink to our North America business effective January 2017 and an increase in selling and administrative expenses in our core business of approximately 5% compared to 2016. The addition of Datalink was the primary driver for the $62.4 million increase in salaries and wages, contract labor and teammate benefit expenses for 2017 compared to 2016, as well as year over year increases in travel and entertainment, facilities and marketing expenses. Depreciation and amortization expense also increased approximately $6.0 million year over year, as amortization expense of $11.5 million, associated with the intangible assets acquired from Datalink, was offset partially by the year over year effect of intangible assets acquired in previous acquisitions being fully amortized in the third quarter of 2016. Additionally, increased sales and gross profit in 2017 compared to 2016, resulted in a $37.0 million increase in variable compensation year over year.

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AND RESULTS OF OPERATIONS (continued)

EMEA’s selling and administrative expenses increased 3%, or $4.0 million, in 2017 compared to 2016, and increased approximately 10 basis points to 12.1% of net sales in 2017. Excluding the effects of fluctuating foreign currency exchange rates, selling and administrative expenses increased 4% compared to 2016. The increase in expenses was primarily driven by a $3.1 million increase in salaries and wages and teammate benefits expenses due to increased headcount. This year over year increase in selling and administrative expenses was offset partially by a decrease in amortization expense during 2017 compared to 2016, as intangible assets acquired in previous acquisitions were fully amortized in the third quarter of 2016.

APAC’s selling and administrative expenses increased 19%, or $4.6 million, in 2017 compared to 2016, and increased approximately 350 basis points to 17.0% of net sales in 2017. Excluding the effects of fluctuating foreign currency exchange rates, selling and administrative expenses increased 16% compared to 2016. The year over year increase was primarily driven by increased selling and administrative expenses as a result of the acquisition of Ignia, effective September 1, 2016, which accounted for over half of the year over year increase in selling and administrative expenses. Additionally, salaries and wages expenses increased as we invested to support growth in cloud and services sales.

Severance and Restructuring Expenses. During 2017, North America, EMEA and APAC recorded severance expense, net of adjustments, totaling $4.0 million, $4.9 million and $104,000, respectively. The North America charges related to severance actions taken to realign roles and responsibilities subsequent to the acquisition of Datalink in January 2017, as well as a headcount reduction as part of cost reduction initiatives in the fourth quarter of 2017. The EMEA charges primarily related to headcount reductions in France, Germany and the Netherlands as part our cost reduction and restructuring initiatives in EMEA. The APAC charges primarily related to severance actions taken subsequent to the acquisition of Ignia. Current period charges were offset by adjustments for changes in estimates of previous accruals as cash payments were made during 2017. During 2016, North America, EMEA and APAC recorded severance expense, net of adjustments, totaling $3.0 million, $1.5 million and $118,000, respectively. See Note 8 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of severance and restructuring activities.

Acquisition-related Expenses. During 2017, we incurred $3.2 million in direct third-party transaction costs related to the acquisition of Datalink in North America and $106,000 in such costs related to the acquisition of Caase.com in EMEA. Comparatively, during 2016, we incurred $4.3 million in such costs related to the acquisition of Datalink in North America and $169,000 in such costs related to the acquisition of Ignia in APAC. See Note 21 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of acquisitions.

Non-Operating (Income) Expense.

Interest Income. Interest income for 2017 and 2016 was generated from interest earned on cash and cash equivalent bank balances. The slight increase in interest income year over year is primarily due to higher interest rates earned on such balances and to higher average interest-bearing cash and cash equivalent balances during 2017.

Interest Expense. Interest expense primarily relates to borrowings under our financing facilities and imputed interest under our inventory financing facility. Interest expense increased 122%, or $10.5 million, in 2017 compared to 2016 due primarily to borrowings under our Term Loan A (“TLA”) as well as higher borrowing rates and higher average daily balances under our other financing facilities, in 2017 compared to 2016, while imputed interest under our inventory financing facility increased $3.3 million from 2016 to 2017 to $6.7 million. For a description of our various financing facilities, see Notes 5 and 6 to the Consolidated Financial Statements in Part II, Item 8 of this report.

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AND RESULTS OF OPERATIONS (continued)

Net Foreign Currency Exchange Gains/Losses. These gains/losses result from foreign currency transactions, including foreign currency derivative contracts and intercompany balances that are not considered long-term in nature. The change in net foreign currency exchange gains/losses is due primarily to the underlying changes in the applicable exchange rates, partially mitigated by our use of foreign exchange forward contracts to offset the effects of fluctuations in foreign currencies on certain of our non-functional currency assets and liabilities.

Other Expense, Net. Other expense, net, consists primarily of bank fees associated with our cash management activities and was relatively flat in 2017 compared to 2016.

Income Tax Expense. Our effective tax rate for 2017 was 43.0% compared to 39.3% in 2016. The increase in the tax rate from 2016 to 2017 was primarily due to the effect of U.S. federal tax reform that was enacted in December 2017, which accounted for 8.4% of our effective tax rate. The effective tax rate in 2017 was higher than the federal statutory rate of 35.0% primarily due to the effect of U.S. federal tax reform enacted during the fourth quarter of 2017, as previously noted, as well as state income taxes, net of federal income tax benefits, and increases in the valuation allowances in certain foreign jurisdictions. These increases in our effective tax rate in 2017 were offset partially by lower taxes on earnings in foreign jurisdictions. See Note 11 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of income tax expense.

2016 Compared to 2015

As previously noted, the sales mix among our hardware, software and services categories for the years ended December 31, 2016 and 2015 have been reclassified to conform to changes made to the current year presentation, as reflected in the following results of operations discussion for these periods. These changes in classification had no effect on previously reported total net sales, total costs of goods sold or gross profit amounts.

Net Sales. Net sales increased 2%, or $112.4 million, in 2016 compared to 2015. Net sales of products (hardware and software) increased 1% and net sales of services increased 14% in 2016 (as reclassified) compared to 2015 (as reclassified). Our net sales by operating segment for 2016 and 2015 were as follows (dollars in thousands):

	2016		2015		% Change
North America	$	3,971,828	$	3,823,528		4	%
EMEA		1,338,560		1,371,137		(2	%)
APAC		175,127		178,425		(2	%)
Consolidated	$	5,485,515	$	5,373,090		2	%

Net sales in North America increased 4%, or $148.3 million, in 2016 compared to 2015. Net sales of hardware and services (as reclassified) increased 5% and 12%, respectively, year over year, while net sales of software (as reclassified) decreased 1% year to year. The improvement in net sales in the hardware category was due primarily to higher sales of client devices, servers and storage products. The increase in services net sales reflects the BlueMetal acquisition in October 2015 as well as organic growth in technical services projects. Services net sales during 2016 also reflected the continued trend toward higher sales of cloud-based offerings and a higher mix of software maintenance sales that are recorded on a net sales recognition basis, with net sales equal to the gross profit on the transaction. Our net sales by offering category for North America for 2016 (as reclassified) and 2015 (as reclassified), were as follows (dollars in thousands):

	North America
Sales Mix	2016		2015		% Change
	(As Reclassified)		(As Reclassified)
Hardware	$	2,454,889	$	2,336,764		5	%
Software		1,146,808		1,157,168		(1	%)
Services		370,131		329,596		12	%
	$	3,971,828	$	3,823,528		4	%

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AND RESULTS OF OPERATIONS (continued)

In North America, fees earned from activities reported on a net basis of $270,000 and $87,984,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $24,000 and $74,101,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

Net sales in EMEA decreased 2%, or $32.6 million, in 2016 compared to 2015. Excluding the effects of fluctuating foreign currency exchange rates, net sales increased 4% in 2016 compared to 2015. Net sales of software (as reclassified) were up 1% year over year, while net sales of hardware and services (as reclassified) were down 9% and 1%, respectively, year to year. The increase in software net sales in 2016 compared to 2015 was driven by increased volume with large enterprise clients. The decrease in services net sales was due primarily to the relative impact year over year of the volume of sales of software maintenance and cloud subscription products that are recorded on a net sales recognition basis, offset partially by increased sales of license consulting services and partner delivered third-party services to new and existing clients across the region. Our net sales by offering category for EMEA for 2016 (as reclassified) and 2015 (as reclassified), were as follows (dollars in thousands):

	EMEA
	Years Ended December 31,
Sales Mix	2016		2015		% Change
	(As Reclassified)		(As Reclassified)
Hardware	$	481,505	$	531,308		(9	%)
Software		762,427		756,373		1	%
Services		94,628		83,456		13	%
	$	1,338,560	$	1,371,137		(2	%)

In EMEA, fees earned from activities reported on a net basis of $48,586,000 and $43,388,000 that were previously reported as part of our software product category in 2016 and 2015, respectively, were reclassified to services to conform to the current year presentation.

Net sales in APAC decreased 2%, or $3.3 million, in 2016 compared to 2015. Excluding the effects of fluctuating foreign currency exchange rates, net sales in 2016 remained flat compared to 2015. An increase in services and hardware net sales year over year was offset by a decrease in software net sales during 2016 compared to 2015. Our net sales by offering category for APAC for 2016 (as reclassified) and 2015 (as reclassified), were as follows (dollars in thousands):

	APAC
Sales Mix	2016		2015		% Change
	(As Reclassified)		(As Reclassified)
Hardware	$	18,916	$	14,327		32	%
Software		132,718		149,607		(11	%)
Services		23,493		14,491		62	%
	$	175,127	$	178,425		(2	%)

In APAC, fees earned from activities reported on a net basis of $9,000 and $10,991,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $6,000 and $8,439,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

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AND RESULTS OF OPERATIONS (continued)

Net sales by category for North America, EMEA and APAC were as follows for 2016 (as reclassified) and 2015 (as reclassified):

	North America						EMEA						APAC
Sales Mix	2016			2015			2016			2015			2016			2015
Hardware		62	%		61	%		36	%		39	%		11	%		8	%
Software		29	%		30	%		57	%		55	%		76	%		84	%
Services		9	%		9	%		7	%		6	%		13	%		8	%
		100	%		100	%		100	%		100	%		100	%		100	%

Gross Profit. Gross profit increased 4%, or $26.8 million, in 2016 compared to 2015, with gross margin increasing approximately 20 basis points to 13.5% of net sales. Our gross profit and gross profit as a percent of net sales by operating segment for 2016 and 2015 were as follows (dollars in thousands):

	2016		% of Net Sales			2015		% of Net Sales
North America	$	525,481		13.2	%	$	501,563		13.1	%
EMEA		185,687		13.9	%		186,287		13.6	%
APAC		31,934		18.2	%		28,482		16.0	%
Consolidated	$	743,102		13.5	%	$	716,332		13.3	%

North America’s gross profit in 2016 increased 5% compared to 2015, and as a percentage of net sales, gross margin increased by approximately 10 basis points year over year. The year over year increase in gross margin was primarily attributable to increases in supplier discounts year over year as we took advantage of early pay discounts offered by certain of our partners, which generated a 6 basis point improvement in margin year over year. During 2016, we also recognized a $2.2 million insurance settlement as a reduction of cost of sales due to the nature of the related insured loss previously recorded. The insurance settlement accounted for 6 basis points of the year over year margin expansion during 2016 compared to 2015. Although an increase in higher margin consulting services sales generated a 15 basis point improvement in gross margin year over year, the increase was partially offset by a decline in margin generated by sales of warranty services of 12 basis points year to year.

EMEA’s gross profit remained flat in 2016 compared to 2015. Excluding the effects of fluctuating foreign currency exchange rates, gross profit was up 7% in 2016 compared to 2015. As a percentage of net sales, gross margin increased by approximately 30 basis points year over year. The year over year increase in gross margin was primarily attributable to the positive effect on gross margin that results from the higher volume of sales that are recorded on a net sales recognition basis within the net sales line item. Changes in the mix and size of transactions and an increase in partner funding earlier in 2016 also contributed to the margin improvement during 2016 compared to 2015. In addition, we recognized an increase in margin resulting from higher fees from enterprise software agreements during 2016 compared to 2015.

APAC’s gross profit increased 12% in 2016 compared to 2015, with gross margin increasing to 18.2% in 2016 from 16.0% in 2015. Excluding the effects of fluctuating foreign currency exchange rates, gross profit increased 14% in 2016 compared to 2015. The improvement in gross margin in 2016 compared to 2015 was due primarily to the positive effect on margin that results from the higher volume of sales that are recorded on a net sales recognition basis, an increase in the mix of higher margin services net sales, higher partner funding and an increase in hardware sales during 2016 compared to 2015.

Operating Expenses.

Selling and Administrative Expenses. Selling and administrative expenses increased $337,000 in 2016 compared to 2015. Selling and administrative expenses decreased approximately 20 basis points as a percentage of net sales in 2016 compared to 2015.

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AND RESULTS OF OPERATIONS (continued)

Selling and administrative expenses as a percent of net sales by operating segment for 2016 and 2015 were as follows (dollars in thousands):

	2016		% of Net Sales			2015		% of Net Sales
North America	$	401,316		10.1	%	$	396,603		10.4	%
EMEA		160,269		12.0	%		165,879		12.1	%
APAC		23,658		13.5	%		22,424		12.6	%
Consolidated	$	585,243		10.7	%	$	584,906		10.9	%

North America’s selling and administrative expenses increased 1%, or $4.7 million, in 2016 compared to 2015, but decreased approximately 30 basis points year to year as a percentage of net sales to 10.1% of net sales in 2016. Teammate benefits expense, including healthcare expenses, increased $6.0 million year over year due to an increase in healthcare claims, and variable compensation increased $4.6 million as a result of the increase in net sales and gross profit year over year. These increases in expenses during 2016 compared to 2015 were partially offset by a decline in the provision for losses on accounts receivable of $3.4 million in 2016 compared to 2015 due to favorable collection results and a decrease in salaries and wages and contract labor of $2.7 million resulting from cost reduction initiatives implemented earlier in 2016 across our North America business. Our results for 2015 included a non-cash charge of $800,000 to reduce the carrying amount of our real estate held for sale to its estimated fair value less costs to sell.

EMEA’s selling and administrative expenses decreased 3%, or $5.6 million, in 2016 compared to 2015, and decreased approximately 10 basis points to 12.0% of net sales in 2016. Excluding the effects of fluctuating foreign currency exchange rates, selling and administrative expenses increased 3% compared to the prior year. The increase in expenses (excluding the effects of fluctuating foreign currency exchange rates) was primarily driven by increased salaries and wages and teammate benefits expenses attributed to higher average cost per head in conjunction with our investments in sales and services related headcount to support services and cloud growth across the region.

APAC’s selling and administrative expenses increased 6%, or $1.2 million, in 2016 compared to 2015, and increased approximately 90 basis points to 13.5% of net sales in 2016. Excluding the effects of fluctuating foreign currency exchange rates, selling and administrative expenses increased 7% compared to the prior year. The year over year increase is primarily driven by higher variable compensation as a result of the increase in gross profit year over year and increased selling and administrative expenses as a result of the acquisition of Ignia, a business technology consulting and managed services provider, effective September 1, 2016.

Severance and Restructuring Expenses. During 2016, North America, EMEA and APAC recorded severance expense, net of adjustments, totaling $3.0 million, $1.5 million and $118,000, respectively. The North America charges related to a headcount reduction as part of cost reduction initiatives early in 2016 noted previously, while the EMEA charges related to significant restructuring activities, primarily in the United Kingdom, Germany and France, as we worked to reduce our selling and administrative expenses in EMEA. Current period charges were offset by adjustments for changes in estimates of previous accruals as cash payments were made during 2016. During 2015, North America and EMEA recorded severance expense, net of adjustments, totaling $1.1 million and $3.8 million, respectively. APAC did not record any severance expense in 2015. See Note 8 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of severance and restructuring activities.

Acquisition-related Expenses. During 2016, we incurred $169,000 in direct third-party transaction costs related to the acquisition of Ignia and $4.3 million in such costs related to the acquisition of Datalink that was completed on January 6, 2017. See Note 21 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of acquisitions.

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AND RESULTS OF OPERATIONS (continued)

Non-Operating (Income) Expense.

Interest Income. Interest income for 2016 and 2015 was generated from interest earned on cash and cash equivalent bank balances. The increase in interest income year over year is primarily due to higher interest rates earned on such balances and to higher average interest-bearing cash and cash equivalent balances during 2016.

Interest Expense. Interest expense primarily relates to borrowings under our financing facilities and imputed interest under our inventory financing facility. Interest expense increased 19% in 2016 compared to 2015 due primarily to higher borrowing rates and higher average daily balances under our debt facilities in 2016 compared to 2015, while imputed interest under our inventory financing facility remained flat from 2015 to 2016 at $3.4 million. For a description of our various financing facilities, see Notes 5 and 6 to the Consolidated Financial Statements in Part II, Item 8 of this report.

Net Foreign Currency Exchange Gains/Losses. These gains/losses result from foreign currency transactions, including foreign currency derivative contracts and intercompany balances that are not considered long-term in nature. The change in net foreign currency exchange gains/losses is due primarily to the underlying changes in the applicable exchange rates, partially mitigated by our use of foreign exchange forward contracts to offset the effects of fluctuations in foreign currencies on certain of our non-functional currency assets and liabilities.

Other Expense, Net. Other expense, net, consists primarily of bank fees associated with our cash management activities.

Income Tax Expense. Our effective tax rate for 2016 was 39.3% compared to 36.4% in 2015. The increase in the tax rate from 2015 to 2016 was primarily due to the effect of a change in tax law that was enacted in December 2016 related to the taxation of foreign currency translation gains or losses arising from qualified business units and the effect of non-deductible acquisition-related expenses incurred in 2016. The effective tax rate in 2016 was higher than the federal statutory rate of 35.0% primarily due to the increases in the valuation allowances in certain foreign jurisdictions and state taxes in the United States as well as the tax law change during the fourth quarter of 2016 and the effect of non-deductible acquisition-related expenses incurred in 2016, as noted previously. These increases in our effective tax rate in 2016 were offset partially by lower taxes on earnings in foreign jurisdictions. See Note 11 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of income tax expense.

Liquidity and Capital Resources

The following table sets forth certain consolidated cash flow information for 2017, 2016 and 2015 (in thousands):

	2017			2016			2015
Net cash (used in) provided by operating activities	$	(305,426	)	$	96,128		$	181,102
Net cash used in investing activities		(204,645	)		(21,185	)		(57,637	)
Net cash provided by (used in) financing activities		397,121			(58,230	)		(83,328	)
Foreign currency exchange effect on cash and cash equivalent balances		15,899			(1,809	)		(16,683	)
(Decrease) increase in cash and cash equivalents		(97,051	)		14,904			23,454
Cash and cash equivalents at beginning of year		202,882			187,978			164,524
Cash and cash equivalents at end of year	$	105,831		$	202,882		$	187,978

Cash and Cash Flow

Our primary uses of cash during 2017 were to fund working capital requirements, pay down our debt balances, fund capital expenditures and acquire Caase.com and Datalink. Operating activities used $305.4 million in cash in 2017. Both the 2017 and 2016 results are affected by individually significant transactions at each year end, whereby a single significant receivable was collected from a client in the fourth quarter of the year for which the related payment to the supplier was due and paid in January of the following year, as discussed in more detail below. During 2017, we had net combined borrowings on our long-term debt facilities of $269.3 million and acquired Caase.com and Datalink for $6.0 million and $180.9 million, respectively, net of cash and cash equivalents acquired. Capital expenditures were $19.2 million in 2017, a 57% increase from 2016, reflecting higher IT investments in our core ERP systems and e-commerce and digital marketing platforms year over year. Cash and cash equivalent balances in 2017 were positively affected by $15.9 million as a result of foreign currency exchange rates.

37

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

We anticipate that cash flows from operations, together with the funds available under our financing facilities, will be adequate to support our cash and working capital requirements for operations as well as other strategic investments over the next 12 months. We expect existing cash and cash flows from operations to continue to be sufficient to fund our operating cash activities and cash commitments for investing and financing activities, such as capital expenditures, repurchases of our common stock and debt repayments, for at least the next 12 months.

Net cash (used in) provided by operating activities. Cash flows from operating activities reflect our net earnings, adjusted for non-cash items such as depreciation, amortization, stock-based compensation expense and write-offs and write-downs of assets, as well as changes in asset and liability balances. Net earnings for 2017 was also adjusted for the loss on sale of our Russia business, which included a non-cash charge for the release of our cumulative translation adjustment balance upon sale of the foreign entity. As noted previously, our net sales grew 22% in 2017 and in particular, our North America net sales grew 30%. This level of growth required significant working capital investments as we experienced higher demand for inventory positions with key clients and, at the same time, our accounts receivable balances began to age as collection efforts did not keep up with the growth. The 2017 results also reflect the collection of a single significant receivable from a client in the fourth quarter of 2016 for which the related payment to the supplier of approximately $160 million was due and paid in January 2017, as noted previously. Further impacting our operating cash flows was the fact that we report cash flows associated with trade payables financed under our inventory financing facility in the financing section of our statement of cash flows. In 2017, and most notably in the fourth quarter, we expanded the use of that facility with certain vendors. Had we not leveraged the facility during 2017, the net borrowings under our inventory financing facility of $141.0 million that are reflected as cash flows provided by financing activities would have been included within trade payables, which are reflected in the operating activities section of our statement of cash flows. The increase in inventories was primarily attributable to an increase in inventory levels at December 31, 2017 to support specific client engagements. The decrease in deferred revenue was a result of revenue recognition in 2017 on a number of larger client transactions in North America for which monies had been collected from clients prior to December 31, 2016, in advance of meeting the criteria for revenue recognition.

In 2016, the increases in accounts receivable and accounts payable reflected increased sales and associated costs of goods sold, respectively, in 2016 compared to 2015. However, the 2016 results were also affected by a single significant receivable collected from a client in the fourth quarter of 2016 for which the related payment to the supplier of approximately $160 million was due and paid in January 2017, as noted previously. In the fourth quarter of 2015, we had a similar experience with a significant receivable collected in the quarter for which the payment to the supplier of approximately $60 million was not made until the first quarter of 2016. Excluding the effects of these two individually significant timing differences, cash flow from operations would have been nominal for 2016. Additionally, the increase in accounts payable reflected as cash provided by operating activities in 2016 was affected by the increased use of our inventory financing facility in 2016 to facilitate the purchase of inventory from various suppliers. Increases in accounts payable under this facility were reflected as cash provided by financing activities, as discussed below. Had these purchases been made without using the inventory financing facility during 2016, the net borrowings under our inventory financing facility of $48.6 million that were reflected as cash flows from financing activities would have been reflected as an increase in accounts payable, which would have been an increase in cash provided by operating activities. We used more working capital in the fourth quarter of 2016 compared to the fourth quarter of 2015, as our sales growth was weighted to the last two months of the current year. The $50.1 million increase in other assets was primarily a result of our deferral of costs for certain payments made or payable to partners at December 31, 2016, in advance of our being able to recognize the related revenue. The $28.9 million increase in inventories was primarily attributable to an increase in inventory levels at December 31, 2016, to support specific client engagements and hardware sale transactions in transit to clients as of December 31, 2016 such that delivery was not deemed to have occurred until the product was received by the client in early January 2017.

38

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

In 2015, the increases in accounts receivable and accounts payable reflected increased sales and associated costs of goods sold, respectively, in 2015 compared to 2014. However, the 2015 results were also affected by the single significant receivable collected from a client in the fourth quarter of 2015 for which the related payment to the supplier of approximately $60 million was due and paid in January 2016, as noted previously. The increase in other assets was primarily a result of our deferral of costs for certain payments made or payable to partners at December 31, 2015, in advance of our being able to recognize the related revenue. As a result, cash flows from operating activities in 2015 exceeded our historical average annual cash flow generation of $80 million to $120 million.

Our consolidated cash flow operating metrics for the quarters ended December 31, 2017, 2016 and 2015 were as follows:

	2017			2016			2015
Days sales outstanding in ending accounts receivable (“DSOs”) (a)		94			90			87
Days inventory outstanding (“DIOs”) (b)		13			12			10
Days purchases outstanding in ending accounts payable (“DPOs”) (c)		(72	)		(88	)		(77	)
Cash conversion cycle (days) (d)		35			14			20

(a) Calculated as the balance of accounts receivable, net at the end of the period divided by daily net sales. Daily net sales is calculated as net sales for the quarter divided by 92 days.

(b) Calculated as average inventories (excluding inventories not available for sale) divided by daily costs of goods sold. Average inventories is calculated as the sum of the balances of inventories at the beginning of the period plus inventories at the end of the period divided by two. Daily costs of goods sold is calculated as costs of goods sold for the quarter divided by 92 days.

(c) Calculated as the sum of the balances of accounts payable – trade and accounts payable – inventory financing facility at the end of the period divided by daily costs of goods sold. Daily costs of goods sold is calculated as costs of goods sold for the quarter divided by 92 days.

(d) Calculated as DSOs plus DIOs, less DPOs.

Our cash conversion cycle was 35 days in the fourth quarter ended December 31, 2017, compared to 14 days in the fourth quarter of 2016. Our 2016 cash conversion cycle was below our target range of 20 to 25 days as a result of unusually high DPOs associated with the $160 million payment timing difference in North America at the end of the prior year period, as discussed below. Our 2017 cash conversion cycle was above our target range due to the increases in our inventory and accounts receivable balances noted above. We expect working capital trends to return to normalized levels and have action plans in place to improve our cash flow efficiency in 2018.

Our cash conversion cycle was 14 days in the fourth quarter ended December 31, 2016, a decrease of six days from the fourth quarter of 2015, due primarily to an 11 day increase in DPOs driven by a single significant payment to a supplier in North America that was due and paid in January 2017. Although the payment to the supplier was not due until after year-end, we collected on the accounts receivable from the client in the fourth quarter of 2016 under normal credit terms. Both the 2016 and 2015 results are affected by individually significant transactions at each year end; however, the magnitude of the 2016 transaction had a greater effect on DPOs. The computation of DPOs for the quarter ended December 31, 2016 includes a payable to a supplier of $160 million, and the computation of DPOs for the quarter ended December 30, 2015 includes a payable to a supplier of $60 million, both of which do not have corresponding accounts receivable outstanding as of the end of the respective periods.

Our cash conversion cycle was 20 days in the fourth quarter ended December 31, 2015, a decrease of four days from the fourth quarter of 2014, due primarily to an increase in DPOs in North America driven by a single significant payment to a supplier that was due and paid in January 2016, after the resolution of certain invoicing issues with the supplier. Although we did not pay the supplier until after year-end, we collected on the accounts receivable from the client in the fourth quarter of 2015 under normal credit terms.

We expect that cash flow from operations will be used, at least partially, to fund working capital as we typically pay our partners on average terms that are shorter than the average terms we grant to our clients in order to take advantage of supplier discounts. We intend to use cash generated in 2018 in excess of working capital needs to support our capital expenditures for the year, to repurchase shares of our common stock and to pay down our debt balances. We also may use cash to fund potential acquisitions.

39

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

Net cash used in investing activities. Capital expenditures of $19.2 million, $12.3 million and $13.4 million in 2017, 2016 and 2015, respectively, were primarily related to technology and facility enhancements. We expect total capital expenditures in 2018 to be between $15.0 million and $20.0 million, primarily for technology-related upgrade projects and the integration of prior acquisitions.

During 2017 we acquired Caase.com and Datalink for $6.0 million and $180.9 million, respectively, net of cash and cash equivalents acquired. During 2016, we acquired Ignia for $10.8 million, net of cash acquired, and during 2015, we acquired BlueMetal for $44.2 million, net of cash acquired.

Net cash provided by (used in) financing activities. During 2017, we had net combined borrowings on our long-term debt under our revolving facility, TLA and accounts receivable securitization facility (“ABS facility”) of $269.3 million and had net borrowings under our inventory financing facility of $141.0 million. During 2016, we made net combined repayments on our long-term debt under our revolving facility and our ABS facility of $49.5 million and had net borrowings under our inventory financing facility of $48.6 million. In 2016, we also funded $50.0 million of repurchases of our common stock. During 2015, we had net combined borrowings on our long-term debt under our revolving facility and our ABS facility of $28.0 million and made net repayments under our inventory financing facility of $16.5 million. In 2015, we also funded $91.8 million of repurchases of our common stock.

Financing Facilities

As of December 31, 2017, our long-term debt balance includes $25.0 million outstanding under our $250.0 million ABS facility and $117.5 million outstanding under our $350.0 million revolving facility. In connection with the acquisition of Datalink on January 6, 2017, we amended our revolving facility to expand the facility by $175.0 million in the form of a TLA that requires amortization payments in years one through five. As of December 31, 2017, we had $166.3 million outstanding under our TLA. See Note 6 to the Consolidated Financial Statements in Part II, Item 8 of this report for a description of our amendment to our revolving facility in connection with our acquisition of Datalink.

As of December 31, 2017, the current portion of our long-term debt relates to our capital leases and other financing obligations as well as the amortization payments due in 2018 under our TLA. Our objective is to pay our debt balances down while retaining adequate cash balances to meet overall business objectives.

While the ABS facility has a stated maximum amount, the actual availability under the ABS facility is limited by the quantity and quality of the underlying accounts receivable. As of December 31, 2017, qualified receivables were sufficient to permit access to the full $250.0 million under the ABS facility.

Our consolidated debt balance that can be outstanding at the end of any fiscal quarter under our revolving facility, our TLA and our ABS facility is limited by certain financial covenants, particularly a maximum leverage ratio. The maximum leverage ratio is calculated as aggregate debt outstanding divided by the sum of the Company’s trailing twelve month net earnings (loss) plus (i) interest expense, excluding non-cash imputed interest on our inventory financing facility, (ii) income tax expense (benefit), (iii) depreciation and amortization, (iv) non-cash stock-based compensation, (v) extraordinary or non-recurring non-cash losses or expenses and (vi) certain cash restructuring and acquisition-related charges and synergies, not to exceed a specified cap (“adjusted earnings”). The maximum leverage ratio permitted under the facilities was increased to 3.50 times trailing twelve-month adjusted earnings in connection with the acquisition of Datalink in January 2017. We anticipate that we will be in compliance with our maximum leverage ratio requirements, which will decrease to 3.25 in 2018, over the next four quarters. However, a significant drop in the Company’s adjusted earnings would limit the amount of indebtedness that could be outstanding at the end of any fiscal quarter to a level that would be below the Company’s consolidated maximum facility amounts. Based on the maximum permitted leverage ratio as of December 31, 2017, the Company’s debt balance that could have been outstanding under our revolving facility, TLA and ABS facility was the full amount of the maximum borrowing capacity of $766.3 million.

40

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

Our revolving facility, our TLA and our ABS facility contain various covenants customary for transactions of this type, including limitations on the payment of dividends and the requirement that we comply with maximum leverage and minimum fixed charge ratio requirements, comply with a minimum receivable requirement and meet monthly, quarterly and annual reporting requirements. If we fail to comply with these covenants, the lenders would be able to demand payment within a specified time period. At December 31, 2017, we were in compliance with all such covenants. Further, the terms of the ABS facility identify various circumstances that would result in an “amortization event” under the facility. As of December 31, 2017, no such “amortization event” had occurred.

We also have an agreement with a financial intermediary to facilitate the purchase of inventory from various suppliers under certain terms and conditions. These amounts are classified separately as accounts payable - inventory financing facility in our consolidated balance sheets.

The aggregate availability for vendor purchases under our inventory financing facility is $325,000,000. From time to time and at our option, we may request to increase the aggregate amount available under the inventory financing facility by up to an aggregate of $25,000,000, subject to customary conditions. The facility matures on June 23, 2021. Additionally, the facility may be renewed under certain circumstances described in the agreement for successive 12-month periods. Interest does not accrue on accounts payable under this facility provided the accounts payable are paid within stated vendor terms (typically 60 days).

Notes 5 and 6 to the Consolidated Financial Statements in Part II, Item 8 of this report also include: a description of our financing facilities; amounts outstanding; amounts available and weighted average borrowings and interest rates during the year.

Undistributed Foreign Earnings

Cash and cash equivalents held by foreign subsidiaries are generally subject to U.S. income taxation upon repatriation to the United States. As a result of the U.S. federal tax reform enacted in December 2017, all undistributed foreign earnings are deemed distributed. We provided for U.S. income and withholding taxes on the earnings deemed distributed from all of our foreign subsidiaries during 2017. As of December 31, 2017, we had approximately $87.1 million in cash and cash equivalents in certain of our foreign subsidiaries. As of December 31, 2017, the majority of our foreign cash resides in the Netherlands, Canada and Australia. Certain of these cash balances will be remitted to the United States by paying down intercompany payables generated in the ordinary course of business or though actual dividend distributions.

Off-Balance Sheet Arrangements

We have entered into off-balance sheet arrangements, which include guaranties and indemnifications. These arrangements are discussed in Note 17 to the Consolidated Financial Statements in Part II, Item 8 of this report. We believe that none of our off-balance sheet arrangements have, or are reasonably likely to have, a material current or future effect on our financial condition, sales or expenses, results of operations, liquidity, capital expenditures or capital resources.

41

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

Contractual Obligations

At December 31, 2017, our contractual obligations for continuing operations were as follows (in thousands):

	Payments due by period
	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 Years
Long-term debt (a)	$	308,750	$	13,125	$	64,375	$	231,250	$	—
Capital lease obligations, including interest payments		5,436		3,620		1,816		—		—
Inventory financing facility (b)		319,468		319,468		—		—		—
Operating lease obligations (c)		75,499		18,601		28,739		16,136		12,023
Severance and restructuring obligations (d)		4,640		4,640		—		—		—
Other contractual obligations (e)		40,418		12,631		20,519		5,074		2,194
Total	$	754,211	$	372,085	$	115,449	$	252,460	$	14,217

(a) Reflects the $25.0 million outstanding at December 31, 2017 under our ABS facility as due in June 2019, the date at which the facility matures, $117.5 million outstanding at December 31, 2017 under our revolving facility as due in June 2021, the date at which the facility matures, and $166.3 million outstanding at December 31, 2017 under our TLA. The TLA requires amortization payments of 5%, 7.5%, 10%, 12.5% and 15% of the original principal balance in years one through five, respectively, to be paid quarterly through March 31, 2021, with the remaining balance of $107.2 million due at maturity on June 23, 2021. See further discussion in Note 6 to the Consolidated Financial Statements in Part II, Item 8 of this report.

(b) As of December 31, 2017, this amount has been included in our contractual obligations table above as being due in less than 1 year due to the 30- to 120-day stated vendor terms. See further discussion in Note 5 to the Consolidated Financial Statements in Part II, Item 8 of this report.

(c) Amounts in the table above exclude non-cancellable rental income of approximately $1.6 million due in less than one year and a total of approximately $1.6 million due in years one through three.

(d) As a result of approved severance and restructuring plans, we expect future cash expenditures related to employee termination benefits. See further discussion in Note 8 to the Consolidated Financial Statements in Part II, Item 8 of this report.

(e) The table above includes:

I. Estimated interest payments of $603,000 in 2018 and $301,000 in the first six months of 2019, based on the current debt balance at December 31, 2017 of $25.0 million under our ABS facility, multiplied by the floating interest rate applicable at December 31, 2017 of 2.41% per annum.

II. Estimated interest payments of $4.1 million in 2018, 2019 and 2020 and $2.1 million in the first six months of 2021, based on the current debt balance at December 31, 2017 of $117.5 million under our revolving facility, multiplied by the floating interest rate applicable at December 31, 2017 of 3.49% per annum.

III. Estimated interest payments of $5.7 million in 2018, $5.2 million in 2019, $4.5 million in 2020 and $2.0 million in the first six months of 2021, based on the current debt balance at December 31, 2017 of $166.3 million under our TLA, multiplied by the floating interest rate applicable at December 31, 2017 of 3.57% per annum.

IV. Amounts totaling $197,000 through 2018 for other contractual obligations.

V. We estimate that we will owe $7.5 million in future years in connection with the obligations to perform asset-retirement activities that are conditional on a future event.

The table above excludes $4.3 million of unrecognized tax benefits, including $287,000 related to accrued interest, as we are unable to reasonably estimate the ultimate amount or timing of settlement. See further discussion in Note 11 to the Consolidated Financial Statements in Part II, Item 8 of this report.

Although we set purchase targets with our partners tied to the amount of supplier reimbursements we receive, we have no material contractual purchase obligations with our partners.

Acquisitions

Our strategy includes the possible acquisition of or investments in other businesses to expand or complement our operations or to add certain services capabilities. The magnitude, timing and nature of any future acquisitions or investments will depend on a number of factors, including the availability of suitable candidates, the negotiation of acceptable terms, our financial capabilities and general economic and business conditions. Financing for future transactions would result in the utilization of cash, incurrence of additional debt, issuance of stock or some combination of the three. See Note 21 to the Consolidated Financial Statements in Part II, Item 8 of this report for a discussion of our acquisitions of Caase.com on September 26, 2017 and Datalink on January 6, 2017 and the amendment to our revolving facility to fund, in part, the acquisition of Datalink.

42

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

Inflation

We have historically not been adversely affected by inflation, as technological advances and competition within the IT industry have generally caused the prices of the products we sell to decline and product life cycles tend to be short. This requires our growth in unit sales to exceed the decline in prices in order to increase our net sales. We believe that most price increases could be passed on to our clients, as prices charged by us are not set by long-term contracts; however, as a result of competitive pressure, there can be no assurance that the full effect of any such price increases could be passed on to our clients.

Recently Issued Accounting Standards

The information contained in Note 1 to the Consolidated Financial Statements in Part II, Item 8 of this report concerning a description of recent accounting pronouncements, including our expected dates of adoption and the estimated effects on our results of operations and financial condition, is incorporated by reference herein.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

The information contained in Note 12 to the Consolidated Financial Statements in Part II, Item 8 of this report concerning a description of market risk management, including interest rate risk and foreign currency exchange risk, is incorporated by reference herein.

43

INSIGHT ENTERPRISES, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Item 8. Financial Statements and Supplementary Data

	Page
Reports of Independent Registered Public Accounting Firm		45
Consolidated Balance Sheets – December 31, 2017 and 2016		48
Consolidated Statements of Operations – For each of the years in the three-year period ended December 31, 2017		49
Consolidated Statements of Comprehensive Income – For each of the years in the three-year period ended December 31, 2017		50
Consolidated Statements of Stockholders’ Equity – For each of the years in the three-year period ended December 31, 2017		51
Consolidated Statements of Cash Flows – For each of the years in the three-year period ended December 31, 2017		52
Notes to Consolidated Financial Statements		53

44

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors

Insight Enterprises, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Insight Enterprises, Inc. and subsidiaries (the “Company”) as of December 31, 2017 and 2016, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes (collectively, the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2017, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 23, 2018, expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ KPMG LLP

We have served as the Company’s auditor since 1990.

Phoenix, Arizona

February 23, 2018

45

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors

Insight Enterprises, Inc.:

Opinion on Internal Control Over Financial Reporting

We have audited Insight Enterprises, Inc.’s and subsidiaries (the “Company”) internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company as of December 31, 2017 and 2016, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes (collectively, the “consolidated financial statements”), and our report dated February 23, 2018 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying item 9A(a), Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

46

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ KPMG LLP

Phoenix, Arizona

February 23, 2018

47

INSIGHT ENTERPRISES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

ASSETS	December 31,
	2017			2016
Current assets:
Cash and cash equivalents	$	105,831		$	202,882
Accounts receivable, net		1,814,560			1,436,742
Inventories		194,529			148,203
Inventories not available for sale		36,956			68,619
Other current assets		152,467			127,159
Total current assets		2,304,343			1,983,605
Property and equipment, net		75,252			70,910
Goodwill		131,431			62,645
Intangible assets, net		100,778			20,707
Deferred income taxes		17,064			52,347
Other assets		56,783			29,086
	$	2,685,651		$	2,219,300
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable—trade	$	899,075		$	1,070,259
Accounts payable—inventory financing facility		319,468			154,930
Accrued expenses and other current liabilities		175,860			151,895
Current portion of long-term debt		16,592			480
Deferred revenue		88,979			61,098
Total current liabilities		1,499,974			1,438,662
Long-term debt		296,576			40,251
Deferred income taxes		717			900
Other liabilities		44,915			26,044
		1,842,182			1,505,857
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value, 3,000 shares authorized; no shares issued		—			—
Common stock, $0.01 par value, 100,000 shares authorized; 35,829 and 35,484 shares issued and outstanding in 2017 and 2016, respectively		358			355
Additional paid-in capital		317,155			309,650
Retained earnings		550,220			459,537
Accumulated other comprehensive loss – foreign currency translation adjustments		(24,264	)		(56,099	)
Total stockholders’ equity		843,469			713,443
	$	2,685,651		$	2,219,300

See accompanying notes to consolidated financial statements.

48

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

	Years Ended December 31,
	2017			2016			2015
Net sales:
Products	$	6,038,744		$	4,997,263		$	4,945,547
Services		664,879			488,252			427,543
Total net sales		6,703,623			5,485,515			5,373,090
Costs of goods sold:
Products		5,512,402			4,571,462			4,513,353
Services		272,651			170,951			143,405
Total costs of goods sold		5,785,053			4,742,413			4,656,758
Gross profit		918,570			743,102			716,332
Operating expenses:
Selling and administrative expenses		723,328			585,243			584,906
Severance and restructuring expenses		9,002			4,580			4,907
Loss on sale of foreign entity		3,646			—			—
Acquisition-related expenses		3,329			4,447			—
Earnings from operations		179,265			148,832			126,519
Non-operating (income) expense:
Interest income		(1,209	)		(1,066	)		(783	)
Interest expense		19,174			8,628			7,224
Net foreign currency exchange loss (gain)		855			522			(393	)
Other expense, net		1,347			1,290			1,295
Earnings before income taxes		159,098			139,458			119,176
Income tax expense		68,415			54,768			43,325
Net earnings	$	90,683		$	84,690		$	75,851
Net earnings per share:
Basic	$	2.54		$	2.35		$	2.00
Diluted	$	2.50		$	2.32		$	1.98
Shares used in per share calculations:
Basic		35,741			36,102			37,984
Diluted		36,207			36,438			38,275

See accompanying notes to consolidated financial statements.

49

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

	Years Ended December 31,
	2017		2016			2015
Net earnings	$	90,683	$	84,690		$	75,851
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		31,835		(16,063	)		(26,707	)
Total comprehensive income	$	122,518	$	68,627		$	49,144

See accompanying notes to consolidated financial statements.

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INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

	Common Stock						Treasury Stock						Additional Paid-in			Accumulated Other Comprehensive			Retained			Total Stockholders’
	Shares			Par Value			Shares			Amount			Capital			Loss			Earnings			Equity
Balances at December 31, 2014		40,147		$	401			—		$	—		$	337,167		$	(13,329	)	$	396,992		$	721,231
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		259			3			—			—			(2,268	)		—			—			(2,265	)
Stock-based compensation expense		—			—			—			—			8,922			—			—			8,922
Tax benefit from stock-based compensation		—			—			—			—			553			—			—			553
Repurchase of treasury stock		—			—			(3,300	)		(91,843	)		—			—			—			(91,843	)
Retirement of treasury stock		(3,300	)		(33	)		3,300			91,843			(27,688	)		—			(64,122	)		—
Foreign currency translation adjustments, net of tax		—			—			—			—			—			(26,707	)		—			(26,707	)
Net earnings		—			—			—			—			—			—			75,851			75,851
Balances at December 31, 2015		37,106			371			—			—			316,686			(40,036	)		408,721			685,742
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		269			3			—			—			(2,222	)		—			—			(2,219	)
Stock-based compensation expense		—			—			—			—			11,058			—			—			11,058
Tax benefit from stock-based compensation		—			—			—			—			235			—			—			235
Repurchase of treasury stock		—			—			(1,891	)		(50,000	)		—			—			—			(50,000	)
Retirement of treasury stock		(1,891	)		(19	)		1,891			50,000			(16,107	)		—			(33,874	)		—
Foreign currency translation adjustments, net of tax		—			—			—			—			—			(16,063	)		—			(16,063	)
Net earnings		—			—			—			—			—			—			84,690			84,690
Balances at December 31, 2016		35,484			355			—			—			309,650			(56,099	)		459,537			713,443
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		345			3			—			—			(5,321	)		—			—			(5,318	)
Stock-based compensation expense		—			—			—			—			12,826			—			—			12,826
Foreign currency translation adjustments, net of tax		—			—			—			—			—			31,835			—			31,835
Net earnings		—			—			—			—			—			—			90,683			90,683
Balances at December 31, 2017		35,829		$	358			—		$	—		$	317,155		$	(24,264	)	$	550,220		$	843,469

See accompanying notes to consolidated financial statements.

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INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Years Ended December 31,
	2017			2016			2015
Cash flows from operating activities:
Net earnings	$	90,683		$	84,690		$	75,851
Adjustments to reconcile net earnings to net cash (used in) provided by operating activities:
Depreciation and amortization of property and equipment		25,787			27,493			26,649
Amortization of intangible assets		16,812			10,637			11,308
Non-cash real estate impairment		—			—			800
Provision for losses on accounts receivable		5,245			2,452			6,761
Write-downs of inventories		2,776			2,934			3,997
Write-off of property and equipment		418			—			535
Non-cash stock-based compensation		12,826			11,058			8,922
Deferred income taxes		19,139			10,517			5,174
Loss on sale of foreign entity		3,646			—			—
Gain on sale of real estate		—			(338	)		—
Changes in assets and liabilities:
Increase in accounts receivable		(208,065	)		(168,966	)		(47,206	)
Increase in inventories		(14,046	)		(50,712	)		(9,214	)
Decrease (increase) in other assets		4,982			(50,130	)		(26,714	)
(Decrease) increase in accounts payable		(237,457	)		193,582			113,594
(Decrease) increase in deferred revenue		(27,184	)		10,633			2,927
(Decrease) increase in accrued expenses and other liabilities		(988	)		12,278			7,718
Net cash (used in) provided by operating activities		(305,426	)		96,128			181,102
Cash flows from investing activities:
Acquisitions, net of cash and cash equivalents acquired		(186,932	)		(10,297	)		(44,221	)
Purchases of property and equipment		(19,230	)		(12,266	)		(13,416	)
Proceeds from sale of foreign entity		1,517			—			—
Proceeds from sale of real estate, net		—			1,378			—
Net cash used in investing activities		(204,645	)		(21,185	)		(57,637	)
Cash flows from financing activities:
Borrowings on senior revolving credit facility		1,151,216			772,218			686,410
Repayments on senior revolving credit facility		(1,033,716	)		(772,218	)		(686,410	)
Borrowings on accounts receivable securitization financing facility		3,961,389			2,802,000			1,897,100
Repayments on accounts receivable securitization financing facility		(3,975,889	)		(2,851,500	)		(1,869,100	)
Borrowings under Term Loan A		175,000			—			—
Repayments under Term Loan A		(8,750	)		—			—
Repayments under other financing agreements		(5,636	)		(1,309	)		(543	)
Payments on capital lease obligations		(1,089	)		(445	)		(223	)
Net borrowings (repayments) under inventory financing facility		141,037			48,603			(16,454	)
Payment of debt issuance costs		(1,123	)		(3,360	)		—
Payment of payroll taxes on stock-based compensation through shares withheld		(5,318	)		(2,219	)		(2,265	)
Repurchases of common stock		—			(50,000	)		(91,843	)
Net cash provided by (used in) financing activities		397,121			(58,230	)		(83,328	)
Foreign currency exchange effect on cash and cash equivalent balances		15,899			(1,809	)		(16,683	)
(Decrease) increase in cash and cash equivalents		(97,051	)		14,904			23,454
Cash and cash equivalents at beginning of year		202,882			187,978			164,524
Cash and cash equivalents at end of year	$	105,831		$	202,882		$	187,978

See accompanying notes to consolidated financial statements.

52

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) Operations and Summary of Significant Accounting Policies

Description of Business

We are a Fortune 500 global information technology (“IT”) provider helping businesses of all sizes – from small and medium sized firms to worldwide enterprises, governments, schools and health care organizations – define, architect, implement and manage Intelligent Technology Solutions^TM. We empower our clients to manage their IT environments so they can drive meaningful business outcomes today and transform their operations for tomorrow. Our company is organized in the following three operating segments, which are primarily defined by their related geographies:

Operating Segment	Geography
North America	United States and Canada
EMEA	Europe, Middle East and Africa
APAC	Asia-Pacific

Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services. A discussion of changes in our classification of certain revenue streams during 2017, can be found in Note 20. Prior year results were reclassified to conform to the current year presentation. These reclassifications had no effect on consolidated total net sales.

Acquisitions

Effective September 26, 2017, we acquired Caase Group B.V. (referred to herein as, “Caase.com”), a Dutch cloud service provider, for a purchase price, net of cash acquired, of approximately $6,038,000, subject to a final working capital adjustment. The acquisition was funded using cash on hand.

Effective January 6, 2017, we acquired Datalink Corporation (“Datalink”), a leading provider of IT services and enterprise data center solutions based in Eden Prairie, Minnesota, for a cash purchase price of $257,456,000, which included cash and cash equivalents acquired of $76,597,000. The acquisition was funded using cash on hand and borrowings under our revolving facility in the form of an incremental Term Loan A (“TLA”).

Effective September 1, 2016, we acquired Ignia Pty Ltd (“Ignia”), a business technology consulting and managed services provider headquartered in Perth, Australia, with an additional office in Melbourne, for a cash purchase price, net of cash acquired, of approximately $10,804,000. The acquisition was funded using cash on hand.

Effective October 1, 2015, we acquired BlueMetal Architects, Inc. (“BlueMetal”), an interactive design and technology architecture firm based in the Boston area with offices in Chicago and New York, for a cash purchase price, net of cash acquired, of approximately $44,221,000. The acquisition was funded using borrowings under our accounts receivable securitization financing facility.

Our results of operations include the results of Caase.com, Datalink, Ignia and BlueMetal from their respective acquisition dates. (See Note 21 for a discussion of our acquisitions.)

Principles of Consolidation and Presentation

The consolidated financial statements include the accounts of Insight Enterprises, Inc. and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. References to “the Company,” “Insight,” “we,” “us,” “our” and other similar words refer to Insight Enterprises, Inc. and its consolidated subsidiaries, unless the context suggests otherwise.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Additionally, these estimates and assumptions affect the reported amounts of net sales and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts, valuation of inventories, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

Cash and Cash Equivalents

We consider all highly liquid investments with maturities at the date of purchase of three months or less to be cash equivalents.    

Book overdrafts represent the amount by which outstanding checks issued, but not yet presented to our banks for disbursement, exceed balances on deposit in applicable bank accounts and a legal right of offset with our positive cash balances in other financial institution accounts does not exist. Our book overdrafts, which are not directly linked to a credit facility or other bank overdraft arrangement, do not result in an actual bank financing, but rather constitute normal unpaid trade payables at the end of a reporting period. These amounts are included within our accounts payable balance in our consolidated balance sheets. The changes in these book overdrafts are included within the changes in accounts payable line item as a component of cash flows from operating activities in our consolidated statements of cash flows.

Allowance for Doubtful Accounts

We establish an allowance for doubtful accounts to reflect our best estimate of probable losses inherent in our accounts receivable balance. The allowance is based on our evaluation of the aging of the receivables, historical write-offs and the current economic environment. We write off individual accounts against the reserve when we no longer believe that it is probable that we will collect the receivable because we become aware of a client’s or partner’s inability to meet its financial obligations. Such awareness may be as a result of bankruptcy filings, or deterioration in the client’s or partner’s operating results or financial position.

Inventories

We state inventories, principally purchased IT hardware, at the lower of weighted average cost (which approximates cost under the first-in, first-out method) or net realizable value. We evaluate inventories for excess, obsolescence or other factors that may render inventories unmarketable at normal margins. Write-downs are recorded so that inventories reflect the approximate net realizable value and take into account contractual provisions with our partners governing price protection, stock rotation and return privileges relating to obsolescence. Because of the large number of transactions and the complexity of managing the price protection and stock rotation process, estimates are made regarding write-downs of the carrying amount of inventories. Additionally, assumptions about future demand, market conditions and decisions by manufacturers/publishers to discontinue certain products or product lines can affect our decision to write down inventories.

Inventories not available for sale relate to product sales transactions in which we are warehousing the product and will be deploying the product to our clients’ designated locations subsequent to period-end. Additionally, we may perform services on a portion of the product prior to shipment to our clients and will be paid a fee for doing so. Although these product contracts are non-cancelable with customary credit terms beginning the date the inventories are segregated in our warehouse and invoiced to the client and the warranty periods begin on the date of invoice, these transactions do not meet the sales recognition criteria under GAAP. Therefore, we do not record sales and the inventories are classified as inventories not available for sale on our consolidated balance sheet until the product is delivered. If clients remit payment before we deliver the product to them, we record the payments received as deferred revenue on our consolidated balance sheet until such time as the product is delivered.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Property and Equipment

We record property and equipment at cost. We capitalize major improvements and betterments, while maintenance, repairs and minor replacements are expensed as incurred. Depreciation or amortization is provided using the straight-line method over the following estimated economic lives of the assets:

	Estimated Economic Life
Leasehold improvements	Shorter of underlying lease term or asset life
Furniture and fixtures	2 – 7 years
Equipment	3 – 5 years
Software	3 – 10 years
Buildings	29 years

Costs incurred to develop internal-use software during the application development stage, including capitalized interest, are recorded in property and equipment at cost. External direct costs of materials and services consumed in developing or obtaining internal-use computer software and payroll and payroll-related costs for teammates who are directly associated with and who devote time to internal-use computer software development projects, to the extent of the time spent directly on the project and specific to application development, are capitalized.

Reviews are regularly performed to determine whether facts and circumstances exist which indicate that the useful life is shorter than originally estimated or the carrying amount of assets may not be recoverable. When an indication exists that the carrying amount of long-lived assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

Goodwill

Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of net identified tangible and intangible assets acquired. Goodwill is tested for impairment at the reporting unit level on an annual basis in the fourth quarter and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. We may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform a quantitative goodwill impairment test. Otherwise, the goodwill impairment test is not required. The quantitative goodwill impairment review process compares the fair value of the reporting unit in which goodwill resides to its carrying value. The Company has three reporting units, which are the same as our operating segments. Multiple valuation techniques can be used to assess the fair value of the reporting unit. All of these techniques include the use of estimates and assumptions that are inherently uncertain. Changes in these estimates and assumptions could materially affect the determination of fair value or goodwill impairment, or both.

Intangible Assets

We amortize intangible assets acquired in business combinations using the straight-line method over the following estimated economic lives of the intangible assets from the date of acquisition:

	Estimated Economic Life
Customer relationships	2 –11 years
Tradenames and Restrictive Covenant Agreements	9 months –3 years

We regularly perform reviews to determine if facts and circumstances exist which indicate that the useful lives of our intangible assets are shorter than originally estimated or the carrying amount of these assets may not be recoverable. When an indication exists that the carrying amount of intangible assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

55

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Trade Credits

Trade credit liabilities arise from aged unclaimed credit memos, duplicate payments, payments for returned product or overpayments made to us by our clients, and, to a lesser extent, from goods received by us from a partner for which we were never invoiced. Trade credit liabilities are included in accrued expenses and other current liabilities in our consolidated balance sheets. We derecognize the liability only if it has been extinguished, upon either (1) our payment of the liability to relieve our obligation or (2) our legal release from the related obligation, which is recorded as a reduction of costs of goods sold.

Self-Insurance

We are self-insured in the United States for medical insurance up to certain annual stop-loss limits and workers’ compensation claims up to certain deductible limits. We establish reserves for claims, both reported and incurred but not reported, using currently available information as well as our historical claims experience.

Treasury Stock

We record repurchases of our common stock as treasury stock at cost. We also record the subsequent retirement of these treasury shares at cost. The excess of the cost of the shares retired over their par value is allocated between additional paid-in capital and retained earnings. The amount recorded as a reduction of paid-in capital is based on the excess of the average original issue price of the shares over par value. The remaining amount is recorded as a reduction of retained earnings.

Sales Recognition

Sales are recognized when title and risk of loss are passed to the client, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable and collectibility is reasonably assured. Our standard sales terms are F.O.B. shipping point or equivalent, at which time title and risk of loss have passed to the client. However, because we either (i) have a general practice of covering client losses while products are in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) have specifically stated F.O.B. destination contractual terms with the client, delivery is not deemed to have occurred until the point in time when the product is received by the client. We make provisions for estimated product returns that we expect to occur under our return policy based upon historical return rates.

We leverage drop-shipment arrangements with many of our partners and suppliers to deliver products to our clients without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs. We recognize revenue for drop-shipment arrangements on a gross basis when the product is received by the client. We recognize revenue on a gross basis as the principal in the transaction because we control the transaction as the primary obligor for product fulfillment in the arrangement, we assume inventory risk if the product is returned by the client, we set the price of the product charged to the client, we assume credit risk for the amounts invoiced, and we work closely with our clients to determine their hardware and software specifications.

We record the freight we bill to our clients as net sales and the related freight costs we pay as costs of goods sold. We report sales net of any sales-based taxes assessed by governmental authorities that are imposed on and concurrent with sales transactions.

Revenue is recognized from software sales when clients acquire the right to use or copy software under license, but in no case prior to the commencement of the term of the initial software license agreement, provided that all other revenue recognition criteria have been met (i.e., evidence of the arrangement exists, the fee is fixed or determinable and collectibility of the fee is probable).

We sell certain third-party service contracts, software maintenance and cloud or software-as-a-service subscription products for which we are not the primary obligor. These sales do not meet the criteria for gross sales recognition, and thus are recorded on a net sales recognition basis. As we enter into contracts with third-party service providers or vendors and our clients, we evaluate whether the subsequent sales of such services should be recorded as gross sales or net sales. We determine whether we act as a principal in the transaction and assume the risks and rewards of ownership or if we are simply acting as an agent or broker. Under gross sales recognition, the selling price is recorded in sales and our cost to the third-party service provider or vendor is recorded in costs of goods sold. Under net sales recognition, the cost to the third-party service provider or vendor is recorded as a reduction to sales, resulting in net sales equal to the gross profit on the transaction, and there are no costs of goods sold.

56

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We recognize revenue for sales of services ratably over the time period over which the service will be provided if there is no discernible pattern of recognition of the cost to perform the service. Billings for such services that are made in advance of the related revenue recognized are recorded as deferred revenue and recognized as revenue ratably over the billing coverage period. Revenue from certain arrangements that allow for the use of a product or service over a period of time without taking possession of software are also accounted for ratably over the time period over which the service will be provided.

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred as the services are performed and amounts are earned. Net sales for these services engagements are not a significant portion of our consolidated net sales.

Additionally, we sell certain professional services contracts on a fixed fee basis. Revenues for fixed fee professional services contracts are recognized based on the ratio of costs incurred to total estimated costs. Net sales for these service contracts are not a significant portion of our consolidated net sales.

In certain arrangements, we may provide a combination of hardware and software products and the provision of services. Services that are performed by us in conjunction with hardware and software sales that are completed in our facilities prior to shipment of the product are recognized upon delivery, when title passes to the client, for the hardware sale. Net sales of services that are performed at client locations are primarily service-only contracts and are recorded as sales when the services are performed. The total consideration for an arrangement with multiple deliverables is allocated to all deliverables that represent a separate unit of accounting using the relative selling price method.

Costs of Goods Sold

Costs of goods sold include product costs, direct costs incurred associated with delivering services, outbound and inbound freight costs and provisions for inventory reserves. These costs are reduced by provisions for supplier discounts and certain payments and credits received from partners, as described under “Partner Funding” below.

Selling and Administrative Expenses

Selling and administrative expenses include salaries and wages, bonuses and incentives, stock-based compensation expense, employee-related expenses, facility-related expenses, marketing and advertising expense, reduced by certain payments and credits received from partners related to shared marketing expense programs, as described under “Partner Funding” below, depreciation of property and equipment, professional fees, amortization of intangible assets, provisions for losses on accounts receivable and other operating expenses.

Partner Funding

We receive payments and credits from partners, including consideration pursuant to volume sales incentive programs, volume purchase incentive programs and shared marketing expense programs. Partner funding received pursuant to volume sales incentive programs is recognized as it is earned as a reduction to costs of goods sold. Partner funding received pursuant to volume purchase incentive programs is allocated as a reduction to inventories based on the applicable incentives earned from each partner and is recorded in cost of goods sold as the related inventory is sold. Partner funding received pursuant to shared marketing expense programs is recorded as it is earned as a reduction of the related selling and administrative expenses in the period the program takes place if the consideration represents a reimbursement of specific, incremental, identifiable costs. Consideration that exceeds the specific, incremental, identifiable costs is classified as a reduction of costs of goods sold. The amount of partner funding recorded as a reduction of selling and administrative expenses in our statements of operations totaled $53,227,000, $48,114,000 and $45,146,000 in 2017, 2016 and 2015, respectively.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Concentrations of Risk

Credit Risk

Although we are affected by the international economic climate, management does not believe material credit risk concentration existed at December 31, 2017. We monitor our clients’ financial condition and do not require collateral. Sales to the U.S. federal government, which are diversified across multiple agencies and departments, collectively accounts for approximately 9% of our 2017 net sales. Excluding these sales to the federal government, we are not reliant on any one client. No single client accounted for more than 4% of our consolidated net sales in 2017.

Supplier Risk

Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2017. No other partner accounted for more than 10% of purchases in 2017. Our top five partners as a group for 2017 were Microsoft, Cisco Systems, Tech Data (a distributor), Dell and HP Inc., and approximately 60% of our total purchases during 2017 came from this group of partners. Although brand names and individual products are important to our business, we believe that competitive sources of supply are available in substantially all of our product categories such that, with the exception of Microsoft, we are not dependent on any single partner for sourcing products.

Advertising Costs

Advertising costs are expensed as they are incurred. Advertising expense of $47,053,000, $37,565,000 and $33,568,000 was recorded in 2017, 2016 and 2015, respectively. These amounts were predominantly offset by partner funding earned pursuant to shared marketing expense programs recorded as a reduction of selling and administrative expenses, as discussed in “Partner Funding” above.

Stock-Based Compensation

Stock-based compensation is measured based on the fair value of the award on the date of grant and the corresponding expense is recognized over the period during which an employee is required to provide service in exchange for the reward. Stock-based compensation expense is classified in the same line item of our consolidated statements of operations as other payroll-related expenses specific to the employee. Compensation expense related to service-based restricted stock units (“RSUs”) is recognized on a straight-line basis over the requisite service period for the entire award. Compensation expense related to performance-based RSUs is recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards (i.e., a graded vesting basis).

Foreign Currencies

We use the U.S. dollar as our reporting currency. The functional currencies of our foreign subsidiaries are the local currencies. Accordingly, assets and liabilities of the subsidiaries are translated into U.S. dollars at the exchange rate in effect at the balance sheet dates. Income and expense items are translated at the average exchange rate for each month within the year. The resulting translation adjustments are recorded directly in accumulated other comprehensive income, net of tax – foreign currency translation adjustments as a separate component of stockholders’ equity. Net foreign currency transaction gains/losses, including transaction gains/losses on intercompany balances that are not of a long-term investment nature and non-functional currency cash balances, are reported as a separate component of non-operating (income) expense in our consolidated statements of operations.

Derivative Financial Instruments

We enter into forward foreign exchange contracts to mitigate the risk of non-functional currency monetary assets and liabilities on our consolidated financial statements. These forward contracts are not designated as hedge instruments. The fair value of all derivative assets and liabilities are recorded gross in the other current assets and accrued expenses and other current liabilities sections of our consolidated balance sheets. Gains/losses are recorded net in non-operating (income) expense in our consolidated statements of operations.

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Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable earnings in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date.

We recognize net deferred tax assets to the extent that we believe these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and results of recent operations. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

We record uncertain tax positions on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Interest and penalties related to unrecognized tax benefits are recognized within the income tax expense line in our consolidated statements of operations. Accrued interest and penalties are included within the related tax liability line in our consolidated balance sheets.

Net Earnings Per Share (“EPS”)

Basic EPS is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during each year. Diluted EPS is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding RSUs. A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Years Ended December 31,
	2017		2016		2015
Numerator:
Net earnings	$	90,683	$	84,690	$	75,851
Denominator:
Weighted-average shares used to compute basic EPS		35,741		36,102		37,984
Dilutive potential common shares due to dilutive RSUs, net of tax effect		466		336		291
Weighted-average shares used to compute diluted EPS		36,207		36,438		38,275
Net earnings per share:
Basic	$	2.54	$	2.35	$	2.00
Diluted	$	2.50	$	2.32	$	1.98

In 2017, 2016 and 2015, approximately 40,000, 36,000 and 1,000, respectively, of our RSUs were not included in the diluted EPS calculations because their inclusion would have been anti-dilutive. These share-based awards could be dilutive in the future.                

Recently Issued Accounting Standards

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2017-04, “Simplifying the Test for Goodwill Impairment.” The new standard requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The new standard is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. We adopted this new standard when we performed our annual goodwill impairment analysis for 2017 in the fourth quarter of 2017 and applied it prospectively. The adoption of this standard did not have a material effect on our consolidated financial statements. See “Goodwill” above for further details about our test for goodwill impairment.

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In November 2016, the FASB issued ASU No. 2016-18, “Restricted Cash.” The new standard requires companies to include cash and cash equivalents that have restrictions on withdrawal or use within total cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. The new standard is required to be adopted retrospectively. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments.” The new standard is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. It addresses eight specific cash flow issues to clarify the presentation and classification of cash receipts and cash payments in the statement of cash flows. The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. The new standard is required to be adopted retrospectively. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting.” This new standard simplifies the accounting for share-based payment transactions, including the income tax consequences, the calculation of diluted earnings per share, the treatment of forfeitures, the classification of awards as either equity or liabilities and the classification on the statement of cash flows. This new standard increases volatility in the statement of operations by requiring all excess tax benefits and deficiencies to be recognized as income tax benefit or expense in the statement of operations and treated as discrete items in the period in which they occur. We adopted the new standard as of January 1, 2017, and prospectively applied the provisions in this guidance requiring recognition of excess tax benefits and deficits in the statement of operations, which resulted in an income tax benefit of $2,483,000 for the year ended December 31, 2017. The corresponding increase in net earnings equated to $0.07 per diluted share during the year ended December 31, 2017. Also, as a result of the adoption of the new standard, we made an accounting policy election to recognize forfeitures as they occur and no longer estimate expected forfeitures. The provisions in this guidance requiring the use of a modified retrospective transition method would have required us to record a cumulative effect adjustment in retained earnings as of January 1, 2017. We elected not to adjust retained earnings and to record such cumulative effect adjustment as stock-based compensation in the first quarter of 2017 on the basis of immateriality. Lastly, we applied the provisions of this guidance relating to classification on the statement of cash flows retrospectively. As a result, excess tax benefits from employee gains on stock-based compensation of $323,000 and $592,000 were reclassified from cash flows from financing activities to cash flows from operating activities for the years ended December 31, 2016 and 2015, respectively, to conform to the current period presentation.

In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which supersedes the existing lease recognition requirements in the existing accounting standard for leases. The core principal of the new standard is that an entity should recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years. Early adoption is permitted. The new standard is to be applied using a modified retrospective transition method with the option to elect a number of practical expedients. We expect to adopt the new standard in the first quarter of 2019 and are in the process of determining the effect that the adoption of ASU 2016-02 will have on our consolidated financial statements and disclosures. We have not yet selected our planned transition approach.

In January 2016, the FASB issues ASU No. 2016-01, “Financial Instruments Overview: Recognition and Measurement of Financial Assets and Financial Liabilities.” The new standard amends the guidance on the classification and measurement of financial instruments and changes the accounting for investments in equity securities. The new standard is effective for annual and interim periods in fiscal years beginning after December 15, 2017, and early adoption is permitted. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

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In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” This standard changes the measurement from lower of cost or market to lower of cost and net realizable value. We adopted the standard in the first quarter of 2017 and applied the provisions prospectively. The standard did not have a material effect on our consolidated financial statements.

On May 28, 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” which amends the existing accounting standards for revenue recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard, as amended, will be effective for the Company beginning in the first quarter of 2018. The standard permits two methods of adoption: retrospectively to each prior reporting period presented (the full retrospective transition method) or retrospectively with the cumulative effect adjustment of initially applying the new standard recognized at the date of initial application (the modified retrospective transition method).

We will adopt the standard as of January 1, 2018, and will utilize the modified retrospective transition method. While we are still finalizing our accounting policies under the new standard and are in the process of quantifying the cumulative effect adjustment from prior periods that will be recognized in our consolidated balance sheet as of the date of adoption as an adjustment to retained earnings, to date we have concluded:

• In sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we will change to record both the software license and the accompanying software maintenance on a net basis, as the agent in the arrangement. Under current guidance, we bifurcate the sale of the software license from the sale of the maintenance contract, record the sale of the software product on a gross basis, as the principal in the arrangement, and record the sale of the software maintenance on a net basis, as an agent in the arrangement. This change will lead us to report lower net sales in future periods related to security software products. This change will have no effect on gross profit dollars, but all other things being equal, gross margin for these specific sales would increase compared to prior years.

• The accounting for inventories not available for sale, otherwise known as bill and hold arrangements, will change such that a portion of revenue under the contracts will be recognized earlier than we are recognizing under current accounting standards. Bill and hold arrangements are inventory balances owned and paid for by our clients, but for which we are warehousing the product and will be deploying it to the clients’ locations in a future period.

• The accounting for renewals of certain software term licenses will change to delay revenue recognition until the beginning of the renewal period. Under current guidance, we recognize revenue as the renewal order is completed. We do not believe this change will have a material effect on our sales or profitability trends, as it is only a change in timing of recognition between periods.

• Sales commissions on contracts with performance periods that exceed one year will be recorded as an asset and amortized to expense over the related contract performance period as opposed to being expensed in the period the transaction is generated.

Our analysis and evaluation of the new standard will continue through to when we publish our first quarter of 2018 results. A substantial amount of work has been completed, and findings and progress to date have been reported to management and the Audit Committee. Although we currently believe that the changes overall resulting from the adoption of the new standard will not lead to operating trends that are materially different than we reported in prior years, our evaluation of the effects is still being finalized. Currently, we estimate the total cumulative effect adjustment from prior periods that will be recognized in our consolidated balance sheet as of the date of adoption as an adjustment to retained earnings to be less than $10,000,000, on a pretax basis.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(2) Property and Equipment

Property and equipment consist of the following (in thousands):

	December 31,
	2017			2016
Software	$	171,701		$	159,442
Buildings		65,468			63,253
Equipment		103,542			93,553
Furniture and fixtures		38,459			36,526
Leasehold improvements		25,981			21,132
Land		5,179			5,131
		410,330			379,037
Accumulated depreciation and amortization		(335,078	)		(308,127	)
Property and equipment, net	$	75,252		$	70,910

We periodically assess whether any indicators of impairment existed related to our property and equipment. We incurred non-cash charges of $418,000 and $535,000 during 2017 and 2015, respectively, to write-off certain property and equipment. No such charges were incurred in 2016.

Depreciation and amortization expense related to property and equipment was $25,787,000, $27,493,000 and $26,649,000 in 2017, 2016 and 2015, respectively. Interest charges capitalized in connection with internal-use software development projects in 2017, 2016 and 2015 were immaterial.

(3) Goodwill

The changes in the carrying amount of goodwill for the year ended December 31, 2017 are as follows (in thousands):

	North America			EMEA			APAC			Consolidated
Goodwill	$	379,617		$	151,439		$	13,973		$	545,029
Accumulated impairment losses		(323,422	)		(151,439	)		(13,973	)		(488,834	)
Goodwill acquired during 2016		(507	)		—			6,957			6,450
Balance at December 31, 2016		55,688			—			6,957			62,645
Goodwill acquired during 2017		64,140			4,041			605			68,786
Balance at December 31, 2017	$	119,828		$	4,041		$	7,562		$	131,431

On September 26, 2017, we acquired Caase.com, which has been integrated into our EMEA business. Under the purchase method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired of approximately $4,041,000 was recorded as goodwill in the EMEA reporting unit (see Note 21). The primary driver for this acquisition was to strengthen our ability to deliver Intelligent Technology Solutions to our clients in the Netherlands, with a view to expand into the wider European region in the near future.

On January 6, 2017, we acquired Datalink, which has been integrated into our North America business. Under the purchase method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired of approximately $64,140,000 was recorded as goodwill in the North America reporting unit (see Note 21). The primary driver for this acquisition was to strengthen our position as a leading IT solutions provider with deep technical talent delivering data center solutions to clients on premise or in the cloud.                

On September 1, 2016, we acquired Ignia, which has been integrated into our APAC business. Under the purchase method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired of approximately $6,957,000 was recorded as goodwill in the APAC reporting unit (see Note 21). The primary driver for this acquisition was to expand our global footprint in the areas of application design, digital solutions, cloud, mobility and business analytics, while also building on our unique position to bring solutions powered by Intelligent Technology™ to our clients in the Asia-Pacific region. The change in goodwill in our APAC operating segment as of December 31, 2017 compared to the balance as of December 31, 2016 resulted from a final working capital adjustment of $35,000 during the year and foreign currency translation adjustments associated with the goodwill balance.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

On October 1, 2015, we acquired BlueMetal, which has been integrated into our North America business. In 2016, we resolved the working capital contingency associated with the acquisition of BlueMetal. We recorded the adjustment of the purchase price allocation as a reduction of goodwill in our North America operating segment upon the receipt of $507,000 in cash during 2016.

During 2017, we periodically assessed whether any indicators of impairment existed which would require us to perform an interim impairment review. As of each interim period end during the year, we concluded that a triggering event had not occurred that would more likely than not reduce the fair value of our reporting units below their carrying values. We performed our annual test of goodwill for impairment during the fourth quarter of 2017. The results of the goodwill impairment test indicated that the fair values of our North America, EMEA and APAC reporting units, estimated using the market approach, were in excess of their respective carrying values.

(4) Intangible Assets

Intangible assets consist of the following (in thousands):

	December 31,
	2017			2016
Customer relationships	$	133,660		$	41,711
Other		4,475			1,978
		138,135			43,689
Accumulated amortization		(37,357	)		(22,982	)
Intangible assets, net	$	100,778		$	20,707

In March and December 2017, respectively, the customer relationship intangible assets associated with the 2012 acquisition of Inmac and the 2011 acquisition of Ensynch were fully amortized. As such, the gross intangible assets balance and the accumulated amortization balance were both reduced by approximately $2,516,000, which had no effect on the net intangible assets balance reported in the accompanying consolidated balance sheet as of December 31, 2017.

In September 2016, the customer relationship intangible assets associated with the 2006 acquisition of Software Spectrum Inc. and the 2008 acquisition of MINX Limited in the United Kingdom were fully amortized. As such, the gross intangible assets balance and the accumulated amortization balance were both reduced by approximately $81,817,000, which had no effect on the net intangible assets balance reported in the accompanying consolidated balance sheet as of December 31, 2016.

During 2017, we periodically assessed whether any indicators of impairment existed related to our intangible assets. As of each interim period end during the year, we concluded that a triggering event had not occurred that would more likely than not reduce the fair value of our intangible assets below their carrying values.    

Amortization expense recognized in 2017, 2016 and 2015 was $16,812,000, $10,637,000 and $11,308,000, respectively. Future amortization expense for the remaining unamortized balance as of December 31, 2017 is estimated as follows (in thousands):

Years Ending December 31,	Amortization Expense
2018	$	14,260
2019		11,690
2020		11,677
2021		11,638
2022		11,638
Thereafter		39,875
Total amortization expense	$	100,778

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(5) Accounts Payable - Inventory Financing Facility

We have entered into an agreement with a financial intermediary to facilitate the purchase of inventory from various suppliers under certain terms and conditions, as described below. These amounts are classified separately as accounts payable - inventory financing facility in the accompanying consolidated balance sheets.

The aggregate availability for vendor purchases under our inventory financing facility is $325,000,000. From time to time and at our option, we may request to increase the aggregate amount available under the inventory financing facility by up to an aggregate of $25,000,000, subject to customary conditions. The facility matures on June 23, 2021. Additionally, the facility may be renewed under certain circumstances described in the agreement for successive 12-month periods. Interest does not accrue on accounts payable under this facility provided the accounts payable are paid within stated vendor terms (typically 60 days). We impute interest on the average daily balance outstanding during these stated vendor terms based on our blended incremental borrowing rate during the period under our senior revolving credit facility and our accounts receivable securitization financing facility. Imputed interest of $6,736,000, $3,385,000 and $3,406,000 was recorded in 2017, 2016 and 2015, respectively. If balances are not paid within stated vendor terms, they will accrue interest at prime plus 1.25%. The facility is guaranteed by the Company and each of its material domestic subsidiaries and is secured by a lien on substantially all of the Company’s and each guarantor’s assets.

(6) Debt, Capital Lease and Other Financing Obligations

Debt

Our long-term debt consists of the following (in thousands):

	December 31,
	2017			2016
Senior revolving credit facility	$	117,500		$	—
Term Loan A (less unamortized debt issuance costs of $873)		165,377			—
Accounts receivable securitization financing facility		25,000			39,500
Capital leases and other financing obligations		5,291			1,231
Total		313,168			40,731
Less: current portion of long-term debt		(16,592	)		(480	)
Long-term debt	$	296,576		$	40,251

Our senior revolving credit facility (“revolving facility”) is used for general corporate purposes, which may include acquisitions and share repurchases, and may be used for borrowings in certain foreign currencies and for letters of credit, in each case up to specified sublimits. The revolving facility has an aggregate U.S. dollar equivalent maximum borrowing amount of $350,000,000, including a maximum borrowing capacity that may be used for borrowing in certain foreign currencies of $50,000,000. On January 6, 2017, we amended our revolving facility to expand the facility by $175,000,000 in the form of an incremental Term Loan A (“TLA”). Pricing and all other general terms and conditions of the TLA are governed by the existing revolving facility. The TLA requires amortization payments of 5%, 7.5%, 10%, 12.5% and 15% of the original principal balance in years one through five, respectively, to be paid quarterly through March 31, 2021, with the remaining balance of $107,187,500 due at maturity on June 23, 2021. The revolving facility and TLA are guaranteed by the Company’s material domestic subsidiaries and are secured by a lien on substantially all of the Company’s and each guarantor’s assets.

The interest rates applicable to borrowings under the revolving facility and the TLA are based on the leverage ratio of the Company as set forth on a pricing grid in the agreement. Amounts outstanding under the revolving facility and TLA bear interest, payable quarterly, at a floating rate equal to the prime rate plus a predetermined spread of 0.00% to 0.75% or, at our option, a LIBOR rate plus a pre-determined spread of 1.25% to 2.25%. The floating interest rate applicable at December 31, 2017 was 3.49% per annum for the revolving facility and 3.57% per annum for the TLA. In addition, we pay a quarterly commitment fee on the unused portion of the facility of 0.25% to 0.45%, and our letter of credit participation fee ranges from 1.25% to 2.25%. During 2017, 2016 and 2015, due to availability under our ABS facility, weighted average borrowings under our revolving facility were $63,604,000, $35,811,000 and $21,987,000, respectively. Interest expense associated with the revolving facility and TLA was $8,491,000, $2,191,000 and $1,813,000 in 2017, 2016 and 2015, respectively, including the commitment fee and amortization of deferred financing fees. As of December 31, 2017, we had $117,500,000 outstanding under our revolving facility and approximately $166,250,000 outstanding under the TLA. See discussion of the maximum leverage ratio under “Debt Covenants” below. The revolving facility matures on June 23, 2021.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our accounts receivable securitization financing facility (“ABS facility”) has a maximum aggregate borrowing availability of $250,000,000 and matures on June 23, 2019. Under our ABS facility, we can sell receivables periodically to a special purpose accounts receivable and financing entity (the “SPE”), which is exclusively engaged in purchasing receivables from us. The SPE is a wholly-owned, bankruptcy-remote entity that we have included in our consolidated financial statements. The SPE funds its purchases by selling undivided interests in eligible trade accounts receivable to independent financial institution purchasers under the ABS facility (“Purchasers”), which is administered by an independent financial institution agent. The SPE’s assets are available first and foremost to satisfy the claims of the Purchasers, and we cannot convey any interest in the receivables sold to the Purchasers (or allow any adverse claims on the receivables) without the consent of the Purchasers. In addition, the SPE is required to maintain a minimum capital amount and various reserves pursuant to the terms of the ABS facility. We maintain effective control over the receivables that are sold. Accordingly, the receivables remain recorded on our consolidated balance sheets. At December 31, 2017 and 2016, the SPE owned $1,141,520,000 and $936,467,000, respectively, of receivables recorded at fair value and included in the accompanying consolidated balance sheets. While the ABS facility has a stated maximum amount, the actual availability under the ABS facility is limited by the quantity and quality of the underlying accounts receivable. As of December 31, 2017, qualified receivables were sufficient to permit access to the full $250,000,000 facility amount, of which $25,000,000 was outstanding. See discussion of the maximum leverage ratio under “Debt Covenants” below.

Under the amended ABS facility, interest is payable monthly, and the floating interest rate applicable at December 31, 2017 was 2.41% per annum, including a 0.85% usage fee on any outstanding balances. In addition, we pay a monthly commitment fee on the unused portion of the facility of 0.375%. During the years ended December 31, 2017, 2016 and 2015, the weighted average interest rates on amounts outstanding under our ABS facility, including the usage and commitment fees and the amortization of deferred financing fees, were 2.4%, 1.9% and 1.6%, respectively. Weighted average borrowings under our ABS facility in 2017, 2016 and 2015 were $153,759,000, $145,376,000 and $112,101,000, respectively.

Debt Covenants

Our revolving facility, our TLA and our ABS facility contain various covenants customary for transactions of this type, including limitations on the payment of dividends and the requirement that we comply with maximum leverage and minimum fixed charge ratio requirements, comply with a minimum receivables requirement and meet monthly, quarterly and annual reporting requirements. If we fail to comply with these covenants, the lenders would be able to demand payment within a specified period of time. Further, the terms of the ABS facility identify various circumstances that would result in an “amortization event” under the facility.

Our consolidated debt balance that can be outstanding at the end of any fiscal quarter under our revolving facility, our TLA and our ABS facility is limited by certain financial covenants, particularly a maximum leverage ratio. The maximum leverage ratio is calculated as aggregate debt outstanding divided by the sum of our trailing twelve month net earnings (loss) plus (i) interest expense, excluding non-cash imputed interest on our inventory financing facility, (ii) income tax expense (benefit), (iii) depreciation and amortization, (iv) non-cash stock-based compensation, (v) extraordinary or non-recurring non-cash losses or expenses and (vi) certain cash restructuring and acquisition-related charges and synergies, not to exceed a specified cap (“adjusted earnings”). The maximum leverage ratio permitted under the facilities was increased to 3.50 times trailing twelve-month adjusted earnings in conjunction with the acquisition of Datalink effective January 6, 2017. A significant drop in our adjusted earnings would limit the amount of indebtedness that could be outstanding at the end of any fiscal quarter to a level that would be below our consolidated maximum facility amount. Based on our maximum leverage ratio as of December 31, 2017, our aggregate debt balance that could have been outstanding under our revolving facility, our TLA and our ABS facility was the full amount of the maximum borrowing capacity of $766,250,000, of which $117,500,000 was outstanding under our revolving facility, $166,250,000 was outstanding under our TLA and $25,000,000 was outstanding under our ABS facility at December 31, 2017.

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Capital Lease and Other Financing Obligations

In August 2017, we entered into two 12-month capital leases for certain IT equipment. In May 2017 and March 2016, we entered into capitalized leases with 36-month terms for certain IT equipment. The capital leases were non-cash transactions and, accordingly, have been excluded from our consolidated statements of cash flows for the years ended December 31, 2017 and 2016.

Future minimum payments under the capitalized leases consist of the following as of December 31, 2017 (in thousands):

Years Ending December 31,
2018	$	1,550
2019		1,016
2020		381
Total minimum lease payments		2,947
Less amount representing interest		(145	)
Present value of minimum lease payments	$	2,802

From time to time, we also enter into other financing agreements with financial intermediaries to facilitate the purchase of products from certain vendors. In conjunction with our acquisition of Datalink effective January 6, 2017, we acquired certain obligations associated with Datalink’s financing of the equipment that it leased to its clients. At December 31, 2017, these financing obligations totaled $2,489,000. No amounts were owed under other financing agreements as of December 31, 2016.

The current and long-term portions of our capital lease and other financing obligations are included in the current and long-term portions of long-term debt in the table above and in our consolidated balance sheets as of December 31, 2017 and 2016.

(7) Operating Leases

We have non-cancelable operating leases with third parties, primarily for administrative and distribution center space and computer equipment. Our facilities leases generally provide for periodic rent increases and many contain escalation clauses and renewal options. We recognize rent expense on a straight-line basis over the lease term. Rental expense for these third-party operating leases was $19,126,000, $14,444,000 and $14,737,000 in 2017, 2016 and 2015, respectively, and is included in selling and administrative expenses in the accompanying consolidated statements of operations.

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2017 are as follows (in thousands):

Years Ending December 31,
2018		18,601
2019		16,617
2020		12,122
2021		9,170
2022		6,966
Thereafter		12,023
Total minimum lease payments	$	75,499

Amounts in the table above exclude approximately $1.6 million in each of 2018 and 2019 in non-cancellable rental income.

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(8) Severance and Restructuring Activities

During 2017, 2016 and 2015, we recorded severance expense associated with the elimination of certain positions based on a re-alignment of roles and responsibilities and a continued review of resource needs. Charges in North America included severance actions taken to realign roles and responsibilities subsequent to the acquisition of Datalink in January 2017, as well as a headcount reduction as part of cost reduction initiatives in the fourth quarter of 2017 and early in 2016. Charges in EMEA included ongoing restructuring activities, primarily in France, Germany, the United Kingdom and the Netherlands, as part our cost reduction and restructuring initiatives in the region. The APAC charges primarily related to severance actions taken subsequent to the acquisition of Ignia. The following table details the activity for each of the three years in the period ending December 31, 2017 related to these resource actions, and the outstanding obligations as of December 31, 2017 (in thousands):

	North America			EMEA			APAC			Consolidated
Balances at December 31, 2014	$	857		$	2,971		$	—		$	3,828
Severance costs, net of adjustments		1,126			3,781			—			4,907
Cash payments		(1,456	)		(3,534	)		—			(4,990	)
Foreign currency translation adjustments		(22	)		(235	)		—			(257	)
Balances at December 31, 2015		505			2,983			—			3,488
Severance costs, net of adjustments		2,966			1,496			118			4,580
Cash payments		(2,524	)		(3,239	)		(118	)		(5,881	)
Foreign currency translation adjustments		—			(23	)		—			(23	)
Balances at December 31, 2016		947			1,217			—			2,164
Severance costs, net of adjustments		4,010			4,888			104			9,002
Cash payments		(3,336	)		(3,597	)		(89	)		(7,022	)
Foreign currency translation adjustments		10			486			—			496
Balances at December 31, 2017	$	1,631		$	2,994		$	15		$	4,640

Immaterial adjustments were recorded as a reduction to severance and restructuring expense in each of 2017, 2016 and 2015, due to changes in estimates.

The remaining outstanding obligations as of December 31, 2017 are expected to be paid during the next 12 months and are therefore included in accrued expenses and other current liabilities.

(9) Stock-Based Compensation

We recorded the following pre-tax amounts in selling and administrative expenses for stock-based compensation, by operating segment, in the accompanying consolidated financial statements (in thousands):

	Years Ended December 31,
	2017		2016		2015
North America	$	9,697	$	8,096	$	6,648
EMEA		2,737		2,530		1,908
APAC		392		432		366
Total Consolidated	$	12,826	$	11,058	$	8,922

Company Plan

Our Board of Directors adopted the Amended Insight Enterprises, Inc. 2007 Omnibus Plan (the “Plan”) on March 28, 2011. The Plan was approved by our stockholders on May 18, 2011 at our 2011 annual meeting and, unless sooner terminated, will remain in place until May 18, 2021.                

The Plan allows the Company to grant options, stock appreciation rights, stock awards, restricted stock, stock units (which may also be referred to as “restricted stock units”), performance shares, performance units, cash-based awards and other awards payable in cash or shares of common stock to eligible non-employee directors, employees and consultants. Consultants and independent contractors are eligible if they provide bona fide services that are not related to capital raising or promoting or maintaining a market for the Company’s stock.

On February 17, 2016, the Board of Directors adopted the First Amendment to the Plan (the “First Amendment”). On May 18, 2016 at our 2016 annual meeting, our stockholders approved the First Amendment. The First Amendment: (a) updates the list of performance criteria contained in Section 16.1 of the Plan; (b) imposes a limit on the dollar value of awards that may be granted to any one participant who is a non-employee director during any one calendar year; and (c) adds an objective clawback provision expressly providing that every award granted under the Plan is subject to potential forfeiture or recovery to the fullest extent called for by law, listing standard or Company policy. The First Amendment did not increase the number of shares available for grant under the Plan or extend the term of the Plan.

The Plan is administered by the Compensation Committee of Insight’s Board of Directors, and, except as provided below, the Compensation Committee has the exclusive authority to administer the Plan, including the power to determine eligibility, the types of awards to be granted, the price and the timing of awards. Under the Plan, the Compensation Committee may delegate some of its authority to our Chief Executive Officer to grant awards to individuals other than individuals who are subject to the reporting requirements of Section 16(a) of the Securities Exchange Act of 1934, as amended. As of December 31, 2017, of the 7,250,000 shares of common stock reserved and available for grant under the Plan, 3,215,540 shares of common stock remain available for grant under the Plan.

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Accounting for Restricted Stock Units

We issue RSUs as incentives to certain officers and teammates and as compensation to members of our Board of Directors. We recognize compensation expense associated with the issuance of such RSUs over the vesting period for each respective RSU. The total compensation expense associated with RSUs represents the value based upon the number of RSUs awarded multiplied by the closing price of our common stock on the date of grant. The number of RSUs to be awarded under our service-based RSUs is fixed at the grant date. The number of RSUs ultimately awarded under our performance-based RSUs varies based on whether the Company achieves certain financial results. We record compensation expense each period based on our estimate of the most probable number of RSUs that will be issued under the grants of performance-based RSUs. Recipients of RSUs do not have voting or dividend rights until the vesting conditions are satisfied and shares are released.

As of December 31, 2017, total compensation cost related to nonvested RSUs not yet recognized is $17,483,000, which is expected to be recognized over the next 1.25 years on a weighted-average basis.

The following table summarizes our RSU activity during 2017:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at the beginning of year		1,067,557		$	25.37
Granted		369,438		$	44.12
Vested, including shares withheld to cover taxes		(466,839	)	$	24.88	$	20,284,762	(a)
Forfeited		(78,043	)	$	32.16
Nonvested at the end of year		892,113		$	32.86	$	34,159,007	(b)

^(a) The aggregate fair value of vested RSUs represents the total pre-tax fair value, based on the closing stock price on the day of vesting, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date. The aggregate intrinsic value for RSUs which vested during 2016 and 2015 was $9,235,102 and $9,168,784, respectively.

^(b) The aggregate fair value of the nonvested RSUs and the RSUs expected to vest represents the total pre-tax fair value, based on our closing stock price of $38.29 as of December 29, 2017 (December 31, 2017 was not a trading day), which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.

During each of the years in the three-year period ended December 31, 2017, the RSUs that vested for teammates in the United States were net-share settled such that we withheld shares with value equivalent to the teammates’ minimum statutory United States tax obligation for the applicable income and other employment taxes and remitted the equivalent cash amount to the appropriate taxing authorities. The total shares withheld during 2017, 2016 and 2015 of 122,255, 84,953 and 85,652, respectively, were based on the value of the RSUs on their vesting dates as determined by our closing stock price on such dates. For 2017, 2016 and 2015, total payments for our teammates’ tax obligations to the taxing authorities were $5,318,000, $2,219,000 and $2,265,000, respectively, and are reflected as a financing activity within the accompanying consolidated statements of cash flows. These net-share settlements had the effect of repurchases of our common stock as they reduced the number of shares that would have otherwise been issued as a result of the vesting and did not represent an expense to us.

(10) Assets Held for Sale

In May 2016, we sold real estate that we owned in Bloomingdale, Illinois that was previously classified as a held for sale asset and included in other current assets in the accompanying consolidated balance sheet as of December 31, 2015. In previous years, we recorded non-cash charges to reduce the carrying amount of the related assets to their estimated fair value less costs to sell. During the second quarter of 2016, we recorded a gain on sale of approximately $338,000, which is included in selling and administrative expenses in the accompanying consolidated statement of operations for the year ended December 31, 2016.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(11) Income Taxes

The following table presents the United States (“U.S.”) and foreign components of earnings before income taxes and the related income tax expense (in thousands):

Earnings before income taxes:

	Years Ended December 31,
	2017		2016		2015
United States	$	119,330	$	99,095	$	90,575
Foreign		39,768		40,363		28,601
	$	159,098	$	139,458	$	119,176

Income tax expense:

	Years Ended December 31,
	2017			2016			2015
Current:
U.S. Federal	$	31,067		$	27,947		$	24,369
U.S. State and local		3,636			2,200			2,705
Foreign		14,573			14,104			11,077
		49,276			44,251			38,151
Deferred:
U.S. Federal		20,327			10,395			5,104
U.S. State and local		(427	)		1,088			602
Foreign		(761	)		(966	)		(532	)
		19,139			10,517			5,174
	$	68,415		$	54,768		$	43,325

The following schedule reconciles the differences between the U.S. federal income taxes at the U.S. statutory rate and our income tax expense (dollars in thousands):

	2017					2016					2015
Statutory federal income tax rate	$	55,684		35.0	%	$	48,810		35.0	%	$	41,712		35.0	%
State income tax expense, net of federal income tax benefit		2,808		1.8			3,368		2.4			3,180		2.7
Audits and adjustments, net		(313	)	(0.2	)		(1,039	)	(0.7	)		(886	)	(0.7	)
Change in valuation allowances		2,472		1.5			3,742		2.7			2,944		2.5
Foreign income taxed at different rates		(6,057	)	(3.8	)		(6,611	)	(4.7	)		(5,729	)	(4.8	)
U.S. mandatory deemed repatriation		5,625		3.5			—		—			—		—
Adjustment of net deferred tax assets for enacted U.S. federal tax reform		7,738		4.9			—		—			—		—
Change in U.S. tax law applicable to certain foreign entities		—		—			2,577		1.8			—		—
Non-deductible compensation		571		0.4			518		0.4			474		0.4
Other, net		(113	)	(0.1	)		3,403		2.4			1,630		1.3
Effective tax rate	$	68,415		43.0	%	$	54,768		39.3	%	$	43,325		36.4	%

In December 2017, U.S. federal tax reform was enacted as part of the U.S. Tax Cuts and Jobs Act. As part of the change in tax law, beginning in 2018, the U.S. statutory federal income tax rate was reduced from 35% to 21%. This reduction required a remeasurement of our deferred tax balances that resulted in an increase in our 2017 income tax expense. In addition, the change in tax law included provisions requiring mandatory deemed repatriation of undistributed foreign earnings. In 2017, we recorded a tax charge totaling $13,363,000 in connection with the enactment of the U.S. Tax Cuts and Jobs Act. Due to the enactment date and complexities of the new law, we have not completed our accounting related to these items. In accordance with Staff Accounting Bulletin 118, issued on December 22, 2017, we have concluded that the U.S. income taxes attributable to the remeasurement of U.S. deferred income taxes, the mandatory deemed repatriation provision and the state tax effects of these items are provisional amounts.

A change in U.S. tax law was enacted in December 2016 related to the taxation of foreign currency translation gains or losses arising from qualified business units. The change, which increased our U.S. federal income taxes, affects our foreign entities that are treated as branches for U.S. tax purposes. The “Other, net” line item in the schedule above includes $349,000 and $1,296,000 related to the effect of non-deductible acquisition-related expenses incurred during 2017 and 2016, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

For foreign entities not treated as branches for U.S. tax purposes, historically, we did not provide for U.S. income taxes on the undistributed earnings of these subsidiaries as these earnings were considered to be reinvested and, in the opinion of management, would continue to be reinvested indefinitely outside of the United States. As a result of U.S. federal tax reform enacted during December 2017, all undistributed foreign earnings are deemed distributed.

The significant components of deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2017			2016
Deferred tax assets:
Net operating losses	$	25,418		$	18,964
Foreign tax credits		21,346			13,115
Accruals		5,921			6,426
Goodwill and other intangibles		4,717			35,523
Stock-based compensation		3,023			4,238
Accounts receivable		2,124			2,547
Inventories		1,930			2,598
Property and equipment		1,111			705
Deferred revenue		600			468
Other		335			55
Gross deferred tax assets		66,525			84,639
Valuation allowances		(45,995	)		(30,972	)
Total deferred tax assets		20,530			53,667
Deferred tax liabilities:
Goodwill and other intangibles		(1,587	)		(1,221	)
Accrued withholding tax		(1,452	)		—
Prepaid expenses		(369	)		(204	)
Other		(775	)		(795	)
Total deferred tax liabilities		(4,183	)		(2,220	)
Net deferred tax assets	$	16,347		$	51,447

The net non-current deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2017			2016
Net non-current deferred tax assets	$	17,064		$	52,347
Net non-current deferred tax liabilities		(717	)		(900	)
Net deferred tax assets	$	16,347		$	51,447

As of December 31, 2017, we have a federal net operating loss carryforward (“NOL”) of $1,455,000 and U.S. state NOLs of $1,977,000 that will expire between 2018 and 2036. We also have NOLs from various non-U.S. jurisdictions of $87,056,000. While the majority of the non-U.S. NOLs have no expiration date, $6,258,000 will expire between 2018 and 2024.

On the basis of currently available information, we have provided valuation allowances for certain of our deferred tax assets where we believe it is more likely than not that the related tax benefits will not be realized. At December 31, 2017 and 2016, our valuation allowances totaled $45,995,000 and $30,972,000, respectively, representing non-U.S. NOLs, foreign depreciation allowances and foreign tax credits.

We believe it is more likely than not that forecasted income, including income that may be generated as a result of prudent and feasible tax planning strategies, together with the tax effects of deferred tax liabilities, will be sufficient to fully recover our remaining deferred tax assets. In the future, if we determine that realization of the remaining deferred tax assets and the availability of certain previously paid taxes to be refunded are not more likely than not, we will need to increase our valuation allowances and record additional income tax expense.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes the change in the valuation allowance (in thousands):

	December 31,
	2017			2016
Valuation allowances at beginning of year	$	30,972		$	28,750
Increase in income tax expense		2,472			3,742
U.S. federal tax reform		11,623			—
Foreign currency translation adjustments		2,865			(1,035	)
Other		(1,937	)		(485	)
Valuation allowances at end of year	$	45,995		$	30,972

The increase in our valuation allowance related to U.S. federal tax reform in the table above was primarily related to U.S. mandatory deemed repatriation.

Various taxing jurisdictions are examining our tax returns for certain tax years. Although the outcome of tax audits cannot be predicted with certainty, management believes the ultimate resolution of these examinations will not result in a material adverse effect to our financial position, results of operations or cash flows.

As of December 31, 2017 and 2016, we had approximately $4,273,000 and $2,246,000, respectively, of unrecognized tax benefits. Of these amounts, approximately $287,000 and $195,000, respectively, related to accrued interest. A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest, is as follows (in thousands):

Balance at December 31, 2016	$	2,051
Additions for tax positions added through acquisition		2,484
Subtractions for tax positions in prior periods		(59	)
Additions for tax positions in current period		867
Additions due to foreign currency translation		53
Subtractions due to audit settlements and statute expirations		(1,410	)
Balance at December 31, 2017	$	3,986

In the future, if recognized, the liability associated with uncertain tax positions would affect our effective tax rate. We do not believe there will be any changes over the next 12 months that would have a material effect on our effective tax rate.

Several of our subsidiaries are currently under audit for tax years 2012 through 2015. Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months which could significantly increase or decrease the balance of our gross unrecognized tax benefits. However, based on the status of the various examinations in multiple jurisdictions, an estimate of the range of reasonably possible outcomes cannot be made at this time, but the estimated effect on our income tax expense and net earnings is not expected to be significant.

We, including our subsidiaries, file income tax returns in the U.S. federal jurisdiction and many state and local and non-U.S. jurisdictions. In the United States, federal income tax returns for 2014, 2015, 2016 and 2017 remain open to examination. For U.S. state and local taxes as well as in non-U.S. jurisdictions, the statute of limitations generally varies between three and ten years.

(12) Market Risk Management

Interest Rate Risk

We have interest rate exposure arising from our financing facilities, which have variable interest rates. These variable interest rates are affected by changes in short-term interest rates. We currently do not hedge our interest rate exposure.

We do not believe that the effect of reasonably possible near-term changes in interest rates will be material to our financial position, results of operations and cash flows. Our financing facilities expose our net earnings to changes in short-term interest rates since interest rates on the underlying obligations are variable. We had $117,500,000 outstanding under our revolving facility, $166,250,000 outstanding under our TLA and $25,000,000 outstanding under our ABS facility at December 31, 2017. The interest rate attributable to the borrowings under our revolving facility, our TLA and our ABS facility was 3.49%, 3.57% and 2.41%, respectively, per annum at December 31, 2017. The change in annual pre-tax earnings from operations resulting from a hypothetical 10% increase or decrease in the applicable interest rate would have been immaterial.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Foreign Currency Exchange Risk

We have foreign currency exchange risk related to the translation of our foreign subsidiaries’ operating results, assets and liabilities (see Note 1 for a description of our Foreign Currencies policy). We also maintain cash accounts denominated in currencies other than the functional currency, which expose us to fluctuations in foreign exchange rates. Remeasurement of these cash balances results in gains/losses that are also reported as a separate component of non-operating (income) expense. We monitor our foreign currency exposure and selectively enter into forward exchange contracts to mitigate risk associated with certain non-functional currency monetary assets and liabilities related to foreign denominated payables, receivables and cash balances. Transaction gains and losses resulting from non-functional currency assets and liabilities are offset by gains and losses on forward contracts in non-operating (income) expense, net in our consolidated statements of operations. The counterparties associated with our foreign exchange forward contracts are large creditworthy commercial banks. The derivatives transacted with these institutions are short in duration and, therefore, we do not consider counterparty concentration and non-performance to be material risks. The Company does not have a significant concentration of credit risk with any single counterparty.

(13) Derivative Financial Instruments

We use derivatives to partially offset our exposure to fluctuations in certain foreign currencies. We do not enter into derivative contracts for speculative or trading purposes. Derivatives are recorded at fair value on the balance sheet based on observable market based inputs or unobservable inputs that are corroborated by market data (Level 2). Gains or losses resulting from changes in fair value of the derivative are recorded currently in income. We do not designate our hedges for hedge accounting, and our foreign currency derivative instruments are not subject to any master netting arrangements with our counterparties.

We use foreign exchange forward contracts to mitigate risk associated with certain non-functional currency assets and liabilities from fluctuations in foreign currency exchange rates. Our non-functional currency assets and liabilities are primarily related to foreign currency denominated payables, receivables, and cash balances. The foreign currency forward contracts, carried at fair value, typically have a maturity of one month or less. We currently enter into approximately four foreign exchange forward contracts per month with an average notional value of $10,610,000 and an average maturity of approximately nine days.

Our derivative financial instruments as of December 31, 2017 were not material. The effect of our derivative financial instruments on our results of operations during the years ended December 31, 2017, 2016 and 2015 were a gain of $159,000, a loss of $2,722,000 and a loss of $942,000, respectively. These amounts are reported within the net foreign currency exchange (gain) loss line item in our consolidated statements of operations.

(14) Fair Value Measurements

Fair value measurements are determined based on the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

We have elected to use the income approach to value our foreign exchange derivatives, using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present value amount assuming that participants are motivated, but not compelled, to transact. Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability (specifically LIBOR rates, foreign exchange rates, and foreign exchange forward points). Mid-market pricing is used as a practical expedient for fair value measurements. Fair value measurement of an asset or liability must reflect the nonperformance risk of the entity and the counterparty. Therefore, the impact of the counterparty’s creditworthiness when in an asset position and the Company’s creditworthiness when in a liability position has also been factored into the fair value measurement of the derivative instruments and did not have a material impact on the fair value of these derivative instruments. Both the counterparty and the Company are expected to continue to perform under the contractual terms of the instruments.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of December 31, 2017, we have no non-financial assets or liabilities that are measured and recorded at fair value on a recurring basis, and our other financial assets or liabilities generally consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities and long-term debt. The estimated fair values of our cash and cash equivalents approximate their carrying values and are determined based on quoted prices in active markets for identical assets (Level 1). The estimated fair values of our long-term debt balances approximate their carrying values based on their variable interest rate terms that are based on current market interest rates for similar debt instruments. The fair values of the other financial assets and liabilities are based on the values that would be received or paid in an orderly transaction between market participants and approximate their carrying values due to their nature and short duration.

(15) Benefit Plans

We adopted a defined contribution benefit plan (the “Defined Contribution Plan”) for our U.S. teammates which complies with section 401(k) of the Internal Revenue Code. The Company provides a discretionary match to all participants who make 401(k) contributions pursuant to the Defined Contribution Plan. The discretionary match provided to participants is equivalent to 50% of a participant’s pre-tax contributions up to a maximum of 6% of eligible compensation per pay period. Additionally, we offer several defined contribution benefit plans to our teammates outside of the United States. These plans and their related terms vary by country. Total consolidated contribution expense under these plans was $14,083,000, $7,684,000 and $7,190,000 for 2017, 2016 and 2015, respectively.

(16) Share Repurchase Programs

In February 2016, February 2015 and October 2014, our Board of Directors authorized share repurchase programs of $50,000,000, $75,000,000 and $25,000,000, respectively. No share repurchase program was authorized in 2017. The following table summarizes the shares of our common stock that we repurchased on the open market under these repurchase programs during the years ended December 31, 2017, 2016 and 2015, respectively, in thousands, except per share amounts:

Year	Total Number of Shares Purchased		Average Price Paid per Share		Approximate Dollar Value of Shares Purchased
2017		—	$	—	$	—
2016		1,891		26.43		50,000
2015		3,300		27.83		91,843
Total		5,191			$	141,843

All shares repurchased were retired.

On February 13, 2018, our Board of Directors authorized the repurchase of up to $50,000,000 of our common stock. Our share repurchases will be made on the open market, subject to Rule 10b-18 or in privately negotiated transactions, through block trades, through 10b5-1 plans or otherwise, at management’s discretion. The amount of shares purchased and the timing of the purchases will be based on market conditions, working capital requirements, general business conditions and other factors. We intend to retire the repurchased shares.

(17) Commitments and Contingencies

Contractual

In the ordinary course of business, we issue performance bonds to secure our performance under certain contracts or state tax requirements. As of December 31, 2017, we had approximately $1,962,000 of performance bonds outstanding. These bonds are issued on our behalf by a surety company on an unsecured basis; however, if the surety company is ever required to pay out under the bonds, we have contractually agreed to reimburse the surety company.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Management believes that payments, if any, related to these performance bonds are not probable at December 31, 2017. Accordingly, we have not accrued any liabilities related to such performance bonds in our consolidated financial statements.

Employment Contracts and Severance Plans

We have employment contracts with, and plans covering, certain officers and management teammates under which severance payments would become payable in the event of specified terminations without cause or terminations under certain circumstances after a change in control. In addition, vesting of outstanding nonvested RSUs would accelerate following a change in control. If severance payments under the current employment agreements or plan payments were to become payable, the severance payments would generally range from three to twenty-four months of salary.

Indemnifications

From time to time, in the ordinary course of business, we enter into contractual arrangements under which we agree to indemnify either our clients or third-party service providers from certain losses incurred relating to services performed on our behalf or for losses arising from defined events, which may include litigation or claims relating to past performance. These arrangements include, but are not limited to, the indemnification of our clients for certain claims arising out of our performance under our sales contracts, the indemnification of our landlords for certain claims arising from our use of leased facilities and the indemnification of the lenders that provide our credit facilities for certain claims arising from their extension of credit to us. Such indemnification obligations may not be subject to maximum loss clauses.

Management believes that payments, if any, related to these indemnifications are not probable at December 31, 2017. Accordingly, we have not accrued any liabilities related to such indemnifications in the accompanying consolidated financial statements.

We have entered into separate indemnification agreements with certain of our executive officers and with each of our directors. These agreements require us, among other requirements, to indemnify such officers and directors against expenses (including attorneys’ fees), judgments and settlements incurred by such individual in connection with any action arising out of such individual’s status or service as our executive officer or director (subject to exceptions such as where the individual failed to act in good faith or in a manner the individual reasonably believed to be in, or not opposed to, the best interests of the Company) and to advance expenses incurred by such individual with respect to which such individual may be entitled to indemnification by us. There are no pending legal proceedings that involve the indemnification of any of the Company’s directors or officers.

Contingencies Related to Third-Party Review

From time to time, we are subject to potential claims and assessments from third parties. We are also subject to various governmental, client and partner audits. We continually assess whether or not such claims have merit and warrant accrual. Where appropriate, we accrue estimates of anticipated liabilities in our consolidated financial statements. Such estimates are subject to change and may affect our results of operations and our cash flows.

Legal Proceedings

From time to time, we are party to various legal proceedings arising in the ordinary course of business, including preference payment claims asserted in client bankruptcy proceedings, indemnification claims, claims of alleged infringement of patents, trademarks, copyrights and other intellectual property rights, claims of alleged non-compliance with contract provisions and claims related to alleged violations of laws and regulations. We regularly evaluate the status of the legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss, or an additional loss, may have been incurred and determine if accruals are appropriate. If accruals are not appropriate, we further evaluate each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made for disclosure. Although litigation is inherently unpredictable, we believe that we have adequate provisions for any probable and estimable losses. It is possible, nevertheless, that our consolidated financial position, results of operations or liquidity could be materially and adversely affected in any particular period by the resolution of a legal proceeding. Legal expenses related to defense, negotiations, settlements, rulings and advice of outside legal counsel are expensed as incurred.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company is not involved in any pending or threatened legal proceedings that it believes would reasonably be expected to have a material adverse effect on its business, financial condition or results of operations.

(18) Supplemental Financial Information

Additions and deductions related to the allowance for doubtful accounts receivable for 2017, 2016 and 2015 were as follows (in thousands):

	Balance at Beginning of Year		Additions		Deductions			Balance at End of Year
Allowance for doubtful accounts receivable:
Year ended December 31, 2017	$	9,138	$	5,245	$	(4,225	)	$	10,158
Year ended December 31, 2016	$	11,872	$	2,452	$	(5,186	)	$	9,138
Year ended December 31, 2015	$	19,336	$	6,761	$	(14,225	)	$	11,872

During 2015, we undertook a project to analyze our older accounts receivable to attempt further collection action, or where appropriate, to write off such accounts as uncollectible. Since these aged accounts receivable had been fully reserved against, the write off was accomplished through the elimination of the associated allowance, with no effect on net accounts receivable balances. The reduction of the allowance for doubtful accounts to $11,872,000 at December 31, 2015 was a direct result of the write off of these older fully reserved accounts receivable as well as an overall improvement in managing the receivables portfolio. The reduction of the reserve during 2015 related to these actions had no effect on our results of operations.

(19) Cash Flows

Cash payments for interest on indebtedness and cash payments for taxes on income were as follows (in thousands):

	Years Ended December 31,
	2017		2016		2015
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$	10,976	$	3,782	$	2,866
Cash paid during the year for income taxes, net of refunds	$	55,470	$	39,051	$	41,062

Non-cash investing activities for 2017, 2016 and 2015 included $159,000, $791,000 and $662,000, respectively, of capital expenditures in accounts payable, representing additions purchased at period end but not yet paid for in cash.

(20) Segment and Geographic Information

We operate in three reportable geographic operating segments: North America; EMEA; and APAC. Our offerings in North America and certain countries in EMEA and APAC include IT hardware, software and services. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services.

During the year ended December 31, 2017, subsequent to our acquisition of Datalink, our consolidated net sales from the provision of services approximated 10%. As such, for the year ended December 31, 2017, we began reporting net sales from the provision of services and the related costs of goods sold separately from net sales of products and the related costs of goods on the face of our consolidated statement of operations. For comparability purposes, net sales and costs of goods sold for the years ended December 31, 2016 and 2015 have been expanded to conform to the current year presentation. These changes in presentation had no effect on previously reported total net sales, total costs of goods sold or gross profit amounts.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In conjunction with these changes in presentation, because fees earned from activities reported net are considered services revenues, we reclassified certain revenue streams for which we act as the agent in the transaction to net sales from services. Previously, we included these net revenue streams within our software and, to a lesser extent, hardware sales mix categories based on the type of product being sold (e.g., fees earned for the sale of software maintenance and certain software licenses were included in software sales and fees earned for the sale of certain third-party provided training and warranty services were included in hardware sales when we historically disclosed and analyzed our sales mix). For comparability purposes, our sales mix among our hardware, software and services categories for the years ended December 31, 2016 and 2015 has been reclassified to conform to the current year presentation. These reclassifications had no effect on previously reported total net sales amounts. The following tables summarize net sales by offering for North America, EMEA and APAC including the effect of the reclassifications on the previously reported net sales by sales mix amounts for the years ended December 31, 2016 and 2015 (in thousands):

	North America Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	3,352,355	$	2,454,889	$	2,336,764
Software		1,310,118		1,146,808		1,157,168
Services		519,261		370,131		329,596
	$	5,181,734	$	3,971,828	$	3,823,528

In North America, fees earned from activities reported on a net basis of $270,000 and $87,984,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $24,000 and $74,101,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

	EMEA Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	536,500	$	481,505	$	531,308
Software		710,452		762,427		756,373
Services		108,464		94,628		83,456
	$	1,355,416	$	1,338,560	$	1,371,137

In EMEA, fees earned from activities reported on a net basis of $48,586,000 and $43,388,000 that were previously reported as part of our software product category in 2016 and 2015, respectively, were reclassified to services to conform to the current year presentation.

	APAC Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	27,907	$	18,916	$	14,327
Software		101,412		132,718		149,607
Services		37,154		23,493		14,491
	$	166,473	$	175,127	$	178,425

In APAC, fees earned from activities reported on a net basis of $9,000 and $10,991,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $6,000 and $8,439,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

The method for determining what information regarding operating segments, products and services, geographic areas of operation and major clients to report is based upon the “management approach,” or the way that management organizes the operating segments within a company, for which separate financial information is evaluated regularly by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. Our CODM is our Chief Executive Officer.

All significant intercompany transactions are eliminated upon consolidation, and there are no differences between the accounting policies used to measure profit and loss for our segments or on a consolidated basis. Net sales are defined as net sales to external clients. None of our clients exceeded ten percent of consolidated net sales in 2017, 2016 or 2015.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

A portion of our operating segments’ selling and administrative expenses arise from shared services and infrastructure that we have historically provided to them in order to realize economies of scale and to use resources efficiently. These expenses, collectively identified as corporate charges, include senior management expenses, internal audit, legal, tax, insurance services, treasury and other corporate infrastructure expenses. Charges are allocated to our operating segments, and the allocations have been determined on a basis that we considered to be a reasonable reflection of the utilization of services provided to or benefits received by the operating segments.

The tables below present information about our reportable operating segments (in thousands):

	Year Ended December 31, 2017
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	4,662,473	$	1,246,952	$	129,319	$	6,038,744
Services		519,261		108,464		37,154		664,879
Total net sales		5,181,734		1,355,416		166,473		6,703,623
Costs of goods sold:
Products		4,253,587		1,140,204		118,611		5,512,402
Services		236,470		24,902		11,279		272,651
Total costs of goods sold		4,490,057		1,165,106		129,890		5,785,053
Gross profit		691,677		190,310		36,583		918,570
Operating expenses:
Selling and administrative expenses		530,792		164,305		28,231		723,328
Severance and restructuring expenses		4,010		4,888		104		9,002
Loss on sale of foreign entity		—		3,646		—		3,646
Acquisition-related expenses		3,223		106		—		3,329
Earnings from operations	$	153,652	$	17,365	$	8,248	$	179,265
Total assets	$	2,337,573	$	530,242	$	101,169	$	2,968,984	*
	Year Ended December 31, 2016
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	3,601,697	$	1,243,932	$	151,634	$	4,997,263
Services		370,131		94,628		23,493		488,252
Total net sales		3,971,828		1,338,560		175,127		5,485,515
Costs of goods sold:
Products		3,301,148		1,129,917		140,397		4,571,462
Services		145,199		22,956		2,796		170,951
Total costs of goods sold		3,446,347		1,152,873		143,193		4,742,413
Gross profit		525,481		185,687		31,934		743,102
Operating expenses:
Selling and administrative expenses		401,316		160,269		23,658		585,243
Severance and restructuring expenses		2,966		1,496		118		4,580
Acquisition-related expenses		4,278		—		169		4,447
Earnings from operations	$	116,921	$	23,922	$	7,989	$	148,832
Total assets	$	2,204,351	$	562,293	$	119,778	$	2,886,422	*

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

	Year Ended December 31, 2015
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	3,493,932	$	1,287,681	$	163,934	$	4,945,547
Services		329,596		83,456		14,491		427,543
Total net sales		3,823,528		1,371,137		178,425		5,373,090
Costs of goods sold:
Products		3,196,297		1,167,113		149,943		4,513,353
Services		125,668		17,737		—		143,405
Total costs of goods sold		3,321,965		1,184,850		149,943		4,656,758
Gross profit		501,563		186,287		28,482		716,332
Operating expenses:
Selling and administrative expenses		396,603		165,879		22,424		584,906
Severance and restructuring expenses		1,126		3,781		—		4,907
Earnings from operations	$	103,834	$	16,627	$	6,058	$	126,519
Total assets	$	1,999,485	$	543,146	$	114,973	$	2,657,604	*

* Consolidated total assets do not reflect intercompany eliminations and corporate assets of $283,333,000, $667,122,000 and $643,587,000 at December 31, 2017, 2016 and 2015, respectively.

The following is a summary of our geographic net sales and long-lived assets, consisting of property and equipment, net (in thousands):

	United States		United Kingdom		Other Foreign		Total
2017
Net sales	$	4,933,805	$	684,632	$	1,085,186	$	6,703,623
Total long-lived assets	$	50,462	$	14,783	$	10,007	$	75,252
2016
Net sales	$	3,776,352	$	671,999	$	1,037,164	$	5,485,515
Total long-lived assets	$	46,774	$	13,570	$	10,566	$	70,910
2015
Net sales	$	3,645,876	$	711,957	$	1,015,257	$	5,373,090
Total long-lived assets	$	58,748	$	16,810	$	12,723	$	88,281

Net sales by geographic area are presented by attributing net sales to external customers based on the domicile of the selling location.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We recorded the following pre-tax amounts, by operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

	Years Ended December 31,
	2017		2016		2015
Depreciation and amortization of property and equipment:
North America	$	20,241	$	21,952	$	22,239
EMEA		5,025		4,908		3,757
APAC		521		633		653
		25,787		27,493		26,649
Amortization of intangible assets:
North America		15,971		8,139		8,053
EMEA		73		1,951		2,834
APAC		768		547		421
		16,812		10,637		11,308
Total	$	42,599	$	38,130	$	37,957

(21) Acquisitions

Caase.com

Effective September 26, 2017, we acquired Caase.com, a Dutch cloud service provider, for a purchase price, net of cash acquired, of approximately $6,038,000, subject to a final working capital adjustment. We believe that this acquisition strengthened our ability to deliver Intelligent Technology Solutions to our clients in the Netherlands, with a view to expand into the wider European region in the near future.

The total fair value of net identifiable assets acquired was approximately $2,107,000, including $68,000 of cash acquired and $2,039,000 of identifiable intangible assets, consisting primarily of customer relationships. The customer relationships identifiable intangible asset is being amortized using the straight-line method over its estimated economic life of 8 years. The preliminary purchase price was allocated under the acquisition method of accounting using the information available at the time. During the fourth quarter of 2017, we finalized the fair value assumptions for identifiable intangible assets acquired and reduced the fair value of identifiable intangible assets acquired by approximately $193,000. Goodwill initially recorded of approximately $4,117,000, which was recorded in our EMEA operating segment, was adjusted to $4,041,000 as of December 31, 2017 as a result of the net effects of the decrease in the value of acquired identifiable intangible assets noted previously, adjustments for deferred taxes and foreign currency translation adjustments. None of the goodwill is tax deductible. We will finalize the purchase price allocation in 2018 when the final working capital adjustment is agreed upon and paid and the evaluation of uncertain tax positions, which could lead to an adjustment of the purchase price allocation, is completed.

We consolidated the results of operations for Caase.com within our EMEA operating segment beginning on the effective date of the acquisition. Our historical results would not have been materially affected by the acquisition of Caase.com and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our statements of operations.

Datalink

On January 6, 2017, we completed our acquisition of Datalink, a leading provider of IT services and enterprise data center solutions based in Eden Prairie, Minnesota, for a cash purchase price of $257,456,000, which included cash and cash equivalents acquired of $76,597,000. We believe that this acquisition strengthened our position as a leading IT solutions provider with deep technical talent delivering data center solutions to clients on premise or in the cloud.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

Total purchase price				$	257,456
Fair value of net assets acquired:
Current assets	$	238,577
Identifiable intangible assets – see description below		94,500
Property and equipment		5,843
Other assets		17,888
Current liabilities		(129,071	)
Long-term liabilities, including deferred taxes		(34,421	)
Total fair value of net assets acquired					193,316
Excess purchase price over fair value of net assets acquired (“goodwill”)				$	64,140

Under the acquisition method of accounting, the total purchase price as shown in the table above was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase price over fair value of net assets acquired was recorded as goodwill.

The estimated fair values of current assets and liabilities (other than deferred revenue and related deferred costs) were based upon their historical costs on the date of acquisition due to their short-term nature. The majority of property and equipment were also estimated based upon historical costs as they approximated fair value. Certain long-term assets, including Datalink’s IT system, were written down to the estimated fair value based on the economic benefit expected to be realized from the assets following the acquisition. Deferred revenue acquired primarily represents monies collected prior to January 6, 2017 related to unearned revenues associated with support services to be performed in the future. The estimated fair value of deferred revenue of $65,500,000, which is included in current and long-term liabilities in the table above, was calculated using the adjusted fulfillment cost method as the present value of the costs expected to be incurred by a third party to perform the support services obligations acquired under various customer contracts, plus a reasonable profit associated with the performance effort. The deferred costs acquired represent monies paid prior to January 6, 2017 to purchase third party customer support contracts from manufacturers. The estimated fair value of the deferred costs of $48,029,000, which is included in current and other assets in the table above, was calculated in conjunction with the valuation of deferred revenue discussed above.

Identified intangible assets of $94,500,000 consist primarily of customer relationships, the trade name and non-compete agreements, which were valued at $92,200,000, $2,200,000 and $100,000, respectively. These values were determined using the multiple-period excess earnings method, the relief from royalty method and the lost income method, respectively.

The identifiable intangibles resulting from the acquisition are amortized using the straight-line method over the following estimated useful lives:

Intangible Assets	Estimated Economic Life
Customer relationships	10 Years
Trade name	1 Year
Non-compete agreements	1 Year

Amortization expense recognized for the period from the acquisition date through December 31, 2017 was $11,520,000.

Goodwill of $64,140,000, which was recorded in our North America operating segment, represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed from Datalink. The addition of the Datalink technical employees to our team and the opportunity to grow our data center solutions business are the primary factors making up the goodwill recognized as part of the transaction. None of the goodwill is tax deductible.

The preliminary purchase price was allocated using information available at the time. During the second quarter of 2017, upon analysis of additional information affecting our estimate of the fair value of net assets acquired, we adjusted the purchase price allocation and reduced the goodwill balance by $945,000. During the remainder of 2017, no further adjustments to the purchase price allocation were made, and the purchase price allocation was finalized.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We have consolidated the results of operations for Datalink since its acquisition on January 6, 2017. Consolidated net sales and gross profit for the year ended December 31, 2017 include $524,281,000 and $118,917,000, respectively, from Datalink. The following table reports pro forma information as if the acquisition of Datalink had been completed at the beginning of the earliest period presented (in thousands, except per share amounts):

		Year Ended December 31,
		2017		2016		2015
Net sales	As reported	$	6,703,623	$	5,485,515	$	5,373,090
	Proforma	$	6,707,533	$	6,084,484	$	6,033,750
Net earnings	As reported	$	90,683	$	84,690	$	75,851
	Proforma	$	92,276	$	85,823	$	75,696
Diluted earnings per share	As reported	$	2.50	$	2.32	$	1.98
	Proforma	$	2.55	$	2.36	$	1.98

Ignia

Effective September 1, 2016, we acquired Ignia, a business technology consulting and managed services provider headquartered in Perth, Australia, with an additional office in Melbourne, for a cash purchase price, net of cash acquired, of approximately $10,804,000, subject to a final working capital adjustment. We believe that this acquisition expands our global footprint in the areas of application design, digital solutions, cloud, mobility and business analytics, while also building on our unique position to bring solutions powered by Intelligent Technology™ to our clients in the Asia-Pacific region.

The total fair value of net identifiable assets acquired initially recorded was approximately $5,324,000, including $1,463,000 of cash acquired and $4,716,000 of identifiable intangible assets, consisting primarily of customer relationships and restrictive covenant agreements which are being amortized using the straight-line method over their estimated economic lives of eight years and 27 months, respectively. The preliminary purchase price was allocated using the information available at the time. During the fourth quarter of 2016, we finalized the fair value assumptions for identifiable intangible assets acquired and reduced the fair value of identifiable intangible assets acquired by approximately $218,000. Goodwill initially recorded of approximately $7,248,000, which was recorded in our APAC operating segment, was adjusted to $6,957,000 as of December 31, 2016 as a result of the net effects of the decrease in the value of acquired identifiable intangible assets noted previously and foreign currency translation adjustments. None of the goodwill is tax deductible. We finalized the purchase price allocation in the second quarter of 2017 when the final working capital adjustment of $35,000 was agreed upon.

We consolidated the results of operations for Ignia within our APAC operating segment beginning on September 1, 2016, the effective date of the acquisition. Our historical results would not have been materially affected by the acquisition of Ignia and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our statements of operations.

BlueMetal

Effective October 1, 2015, we acquired BlueMetal, an interactive design and technology architecture firm based in the Boston area, with offices in Chicago and New York, for a cash purchase price, net of cash acquired, of approximately $44,221,000. BlueMetal delivers strategic design, application development, business intelligence solutions and data visualization platforms, and we believe this acquisition strengthens our services capabilities to bring value to our clients’ businesses in the area of application design, mobility and big data.

The total fair value of net assets acquired was approximately $15,412,000, including $15,240,000 of identifiable intangible assets, consisting primarily of customer relationships and restrictive covenant agreements which are being amortized using the straight-line method over their estimated economic lives of eight and three years, respectively. Goodwill acquired approximated $29,938,000, which was recorded in our North America operating segment. In 2016, we resolved the working capital contingency associated with the acquisition of BlueMetal. We recorded an adjustment of the purchase price as a reduction of goodwill in our North America operating segment upon the receipt of $507,000 in cash during 2016. The addition of the BlueMetal employees to our team and the opportunity to grow our services business are the primary factors making up the goodwill recognized as part of the transaction. None of the goodwill is tax deductible.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We consolidated the results of operations for BlueMetal beginning on October 1, 2015, the effective date of the acquisition. Our historical results would not have been materially affected by the acquisition of BlueMetal and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our statements of operations.

(22) Sale of Foreign Entity

On July 19, 2017, we concluded the sale of our operations in Russia, formerly a part of our EMEA operating segment, to one of our global partners that is focused in the region. We recorded a loss on the sale of the foreign entity of approximately $3,646,000 during the third quarter of 2017, including a $2,903,000 charge upon the release of our cumulative translation adjustment account balance as of the sale date.

(23) Selected Quarterly Financial Information (unaudited)

The following tables set forth selected unaudited consolidated quarterly financial information for 2017 and 2016 (in thousands, except per share data):

	Quarters Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
Net sales	$	1,784,075		$	1,757,973		$	1,684,032		$	1,477,543
Costs of goods sold		1,551,192			1,531,892			1,432,653			1,269,316
Gross profit		232,883			226,081			251,379			208,227
Operating expenses:
Selling and administrative expenses		184,554			180,390			180,752			177,632
Severance and restructuring expenses		2,791			494			1,022			4,695
Loss on sale of foreign entity		—			3,646			—			—
Acquisition-related expenses		—			106			276			2,947
Earnings from operations		45,538			41,445			69,329			22,953
Non-operating (income) expense:
Interest income		(346	)		(227	)		(205	)		(431	)
Interest expense		5,360			5,555			4,326			3,933
Net foreign currency exchange (gain) loss		(117	)		341			251			380
Other expense, net		367			339			326			315
Earnings before income taxes		40,274			35,437			64,631			18,756
Income tax expense		26,106			13,025			24,376			4,908
Net earnings	$	14,168		$	22,412		$	40,255		$	13,848
Net earnings per share:
Basic	$	0.40		$	0.63		$	1.13		$	0.39
Diluted	$	0.39		$	0.62		$	1.11		$	0.38
Shares used in per share calculations:
Basic		35,809			35,787			35,765			35,602
Diluted		36,272			36,203			36,169			36,185

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

	Quarters Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016
Net sales	$	1,467,583		$	1,392,716		$	1,456,234		$	1,168,982
Costs of goods sold		1,276,614			1,210,908			1,247,017			1,007,874
Gross profit		190,969			181,808			209,217			161,108
Operating expenses:
Selling and administrative expenses		145,066			143,872			150,186			146,119
Severance and restructuring expenses		1,527			788			909			1,356
Acquisition-related expenses		3,706			741			—			—
Earnings from operations		40,670			36,407			58,122			13,633
Non-operating (income) expense:
Interest income		(282	)		(318	)		(216	)		(250	)
Interest expense		2,271			2,517			1,992			1,848
Net foreign currency exchange (gain) loss		(520	)		579			(153	)		616
Other expense, net		311			352			359			268
Earnings before income taxes		38,890			33,277			56,140			11,151
Income tax expense		17,790			11,642			21,073			4,263
Net earnings	$	21,100		$	21,635		$	35,067		$	6,888
Net earnings per share:
Basic	$	0.59		$	0.61		$	0.96		$	0.19
Diluted	$	0.59		$	0.60		$	0.96		$	0.18
Shares used in per share calculations:
Basic		35,479			35,474			36,380			37,075
Diluted		35,963			35,790			36,612			37,386

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Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

(a) Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as such term is defined under Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Our management, including our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2017. In making this assessment, our management used the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Management has concluded that the Company maintained effective internal control over financial reporting as of December 31, 2017, based on the criteria established in COSO’s Internal Control – Integrated Framework.

KPMG LLP, the independent registered public accounting firm that audited the Consolidated Financial Statements in Part II, Item 8 of this report, has issued an attestation report on the Company’s internal control over financial reporting as of December 31, 2017.

(b) Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended December 31, 2017 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

(c) Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act). Our Chief Executive Officer and Chief Financial Officer, as of the end of the period covered by this report, evaluated the effectiveness of our disclosure controls and procedures and determined that as of December 31, 2017 our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

(d) Inherent Limitations of Disclosure Controls and Internal Control Over Financial Reporting

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Item 9B. Other Information

Not applicable.

84

INSIGHT ENTERPRISES, INC.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

The information required by this item can be found in our definitive Proxy Statement relating to our 2018 Annual Meeting of Stockholders (our “Proxy Statement”) and is incorporated herein by reference.

Item 11. Executive Compensation

The information required by this item can be found in our Proxy Statement and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item can be found in our Proxy Statement and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this item can be found in our Proxy Statement and is incorporated herein by reference.

Item 14. Principal Accounting Fees and Services

The information required by this item can be found in our Proxy Statement and is incorporated herein by reference.

PART IV

Item 15. Exhibits, Financial Statement Schedules

(a) Financial Statements and Schedules

The Consolidated Financial Statements of Insight Enterprises, Inc. and subsidiaries and the related Reports of Independent Registered Public Accounting Firm are filed herein as set forth under Part II, Item 8 of this report.

Financial statement schedules have been omitted since they are either not required, not applicable, or the information is otherwise included in the Consolidated Financial Statements or notes thereto.

(b) Exhibits

The exhibits list immediately following the signature page is incorporated herein by reference as the list of exhibits required as part of this report.

Item 16. Form 10-K Summary

None.

85

INSIGHT ENTERPRISES, INC.

EXHIBITS TO FORM 10-K

YEAR ENDED DECEMBER 31, 2017

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
2.1	Agreement and Plan of Merger, dated as of November  6, 2016, by and among Insight Enterprises, Inc., Reef Acquisition Co., and Datalink Corporation (Schedules and exhibits to the Agreement and Plan of Merger have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant will furnish copies of any such schedules to the U.S. Securities and Exchange Commission upon request.)	8-K	000-25092	2.1	November 7, 2016
3.1	Amended and Restated Certificate of Incorporation of Insight Enterprises, Inc.	10-K	000-25092	3.1	February 17, 2006
3.2	Certificate of Amendment of Amended and Restated Certificate of Incorporation of Insight Enterprises, Inc.	8-K	000-25092	3.1	May 21, 2015
3.3	Amended and Restated Bylaws of Insight Enterprises, Inc.	8-K	000-25092	3.2	May 21, 2015
4.1 (P)	Specimen Common Stock Certificate	S-1	33-86142	4.1	January 20, 1995
10.1(1)	Form of Indemnification Agreement	10-K	000-25092	10.1	July 26, 2007
10.2(2)	Amended Insight Enterprises, Inc. 2007 Omnibus Plan	Proxy Statement	000-25092	Annex A	April 4, 2011
10.3(2)	First Amendment to the Amended Insight Enterprises, Inc. 2007 Omnibus Plan	Proxy Statement	000-25092	Annex A	April 5, 2016
10.4(2)	Executive Management Separation Plan effective as of January 1, 2008	10-Q	000-25092	10.5	November 7, 2008
10.5(2)	Amended and Restated Employment Agreement between Insight Enterprises, Inc. and Glynis A. Bryan dated as of January 1, 2009	8-K	000-25092	10.3	January 7, 2009
10.6(2)	Executive Employment Agreement between Insight Enterprises, Inc. and Kenneth T. Lamneck, dated as of December 14, 2009	10-K	000-25092	10.24	February 25, 2010
10.7(2)	Employment Agreement between Insight Enterprises, Inc. and Michael P. Guggemos, dated as of November 1, 2010	10-K	000-25092	10.16	February 23, 2011
10.8(2)	Offer of employment letter to Michael P. Guggemos, dated September 28, 2010	10-K	000-25092	10.17	February 23, 2011

86

INSIGHT ENTERPRISES, INC.

EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2017

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
10.9(2)	Employment Agreement between Insight Enterprises, Inc. and Steven W. Dodenhoff, dated as of January 30, 2012	10-K	000-25092	10.16	February 24, 2012
10.10(2)	Employment Agreement between Insight Enterprises, Inc. and Dana A. Leighty, dated as of March 2, 2012	10-K	000-25092	10.12	February 22, 2013
10.11(2)	Managing Director Service Agreement dated October 25, 2013 between Insight Technology Solutions GmbH and Wolfgang Ebermann	8-K	000-25092	10.1	October 30, 2013
10.12(2)	Executive Employment Agreement between Insight Enterprises, Inc. and Samuel C. Cowley, dated June 7, 2016	10-K	000-25092	10.12	February 2, 2017
10.13	Receivables Purchase Agreement dated as of December  31, 2002 among Insight Receivables, LLC, Insight Enterprises, Inc., Jupiter Securitization Corporation, Bank One NA, and the entities party thereto from time to time as financial institutions	10-K	000-25092	10.38	March 27, 2003
10.14	Amended and Restated Receivables Sale Agreement dated as of September  3, 2003 by and among Insight Direct USA, Inc. and Insight Public Sector, Inc. as originators, and Insight Receivables, LLC, as buyer	10-Q	000-25092	10.1	November 13, 2003
10.15	Amendment No. 1 to Receivables Purchase Agreement dated as of September 3, 2003	10-Q	000-25092	10.2	November 13, 2003
10.16	Amendment No. 2 to Receivables Purchase Agreement dated as of December  23, 2003 among Insight Receivables, LLC, Insight Enterprises, Inc. and Jupiter Securitization Corporation, Bank One NA	10-K	000-25092	10.42	March 11, 2004
10.17	Amendment No. 5 to Receivables Purchase Agreement dated as of March 25, 2005	10-Q	000-25092	10.4	May 9, 2005
10.18	Amendment No. 6 to Receivables Purchase Agreement dated as of December 19, 2005	8-K	000-25092	10.1	December 22, 2005
10.19	Amendment No. 7 to Receivables Purchase Agreement dated as of September 7, 2006	8-K	000-25092	10.2	September 8, 2006

87

INSIGHT ENTERPRISES, INC.

EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2017

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
10.20	Amendment No. 9 to Receivables Purchase Agreement dated as of September 17, 2008	8-K	000-25092	10.3	September 23, 2008
10.21	Amendment No. 11 and Joinder Agreement to Receivables Purchase Agreement dated as of July 24, 2009	10-Q	000-25092	10.1	August 6, 2009
10.22	Amendment No. 12 to Receivables Purchase Agreement dated as of July  1, 2010 among Insight Receivables, LLC, Insight Enterprises, Inc., the Purchasers and Managing Agents party thereto, and JPMorgan Chase Bank, N.A. (successor by merger to Bank One, NA (Main Office Chicago)), as agent for the Purchasers	10-Q	000-25092	10.1	November 4, 2010
10.23	Omnibus Amendment and Joinder to Receivables Purchase Agreement, dated as of April  26, 2012, among Insight Receivables, LLC, Insight Enterprises, Inc., Insight Direct USA, Inc., Insight Public Sector, Inc., the purchasers and managing agents party thereto and JPMorgan Chase Bank, N.A., as Agent	8-K	000-25092	10.3	May 2, 2012
10.24	Third Amended and Restated Credit Agreement, dated as of April  26, 2012, by and among Insight Enterprises, Inc., Insight Enterprises B.V., Insight Direct (UK) Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, Wells Fargo Bank, National Association, as syndication agent, and the lenders party thereto	8-K	000-25092	10.1	May 2, 2012
10.25	Amended and Restated Credit Agreement, dated as of April 26, 2012, by and among Calence, LLC, Insight Direct USA, Inc. and Insight Public Sector, Inc., as Resellers, Castle Pines Capital LLC, as administrative agent, Wells Fargo Capital Finance, LLC, as collateral agent, syndication agent and administrative agent, and the lenders party thereto	8-K	000-25092	10.2	May 2, 2012

88

INSIGHT ENTERPRISES, INC.

EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2017

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
10.26	Omnibus Amendment, dated as of June  25, 2014, among Insight Receivables, LLC, Insight Enterprises, Inc., Insight Direct USA, Inc., Insight Public Sector, Inc., the purchasers and managing agents party thereto and Wells Fargo Bank, National Association, as successor agent	8-K	000-25092	10.1	July 1, 2014
10.27	Amendment No. 2 to Amended and Restated Credit Agreement, dated as of July  2, 2015, by and among Calence, LLC, Insight Direct USA, Inc. and Insight Public Sector, Inc., as Resellers, Castle Pines Capital LLC, as a lender and as an administrative agent, Wells Fargo Capital Finance, LLC, as a lender, as collateral agent and as an administrative agent, and the other lenders party thereto.	8-K	000-25092	10.1	July 9, 2015
10.28	Amendment No. 2 to Third Amended and Restated Credit Agreement, dated as of April  26, 2012, by and among Insight Enterprises, Inc., Insight Enterprises B.V., Insight Direct (UK) Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, Wells Fargo Bank, National Association, as syndication agent, and the lenders party thereto	10-Q	000-25092	10.1	October 29, 2015
10.29	Amendment No. 3 to Amended and Restated Credit Agreement, dated as of April  26, 2012, by and among Calence, LLC, Insight Direct USA, Inc. and Insight Public Sector, Inc., as Resellers, Castle Pines Capital LLC, as administrative agent, Wells Fargo Capital Finance, LLC, as collateral agent, syndication agent and administrative agent, and the lenders party thereto	10-Q	000-25092	10.2	October 29, 2015
10.30	Amendment to Receivables Purchase Agreement, dated as of October  15, 2015, among Insight Receivables, LLC, Insight Enterprises, Inc., PNC Bank, National Association and Wells Fargo Bank, National Association	10-Q	000-25092	10.3	October 29, 2015

89

INSIGHT ENTERPRISES, INC.

EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2017

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
10.31	Fourth Amended and Restated Credit Agreement, dated as of June  23, 2016, by and among Insight Enterprises, Inc., Insight Enterprises B.V., Insight Direct (UK) Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, Wells Fargo Bank, National Association, as syndication agent, and the lenders party thereto	8-K	000-25092	10.1	June 28, 2016
10.32	Second Amended and Restated Credit Agreement, dated as of June 23, 2016, by and among Calence, LLC, Insight Direct USA, Inc. and Insight Public Sector, Inc., as Resellers, Castle Pines Capital LLC, as administrative agent, Wells Fargo Capital Finance, LLC, as collateral agent, syndication agent and administrative agent, and the lenders party thereto	8-K	000-25092	10.2	June 28, 2016
10.33	Amendment to Receivables Purchase Agreement, dated as of June  23, 2016, among Insight Receivables, LLC, Insight Enterprises, Inc., the purchasers and managing agents party thereto and Wells Fargo Bank, National Association, as Agent	8-K	000-25092	10.3	June 28, 2016
10.34	Amendment No.  1 dated as of January 6, 2017 to Fourth Amended and Restated Credit Agreement, by and among Insight Enterprises, Inc., Insight Enterprises B.V. and Insight Direct (UK) Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto	10-K	000-25092	10.34	February 2, 2017
10.35	Second Omnibus Reaffirmation Agreement, Amendment and Joinder to Loan Documents, dated as of January  6, 2017, by and among Calence, LLC, Insight Direct USA, Inc., Insight Public Sector, Inc. and Datalink Corporation, as Resellers, the guarantors party thereto, Castle Pines Capital LLC, as administrative agent, Wells Fargo Capital Finance, LLC, as collateral agent and administrative agent, and the lenders party thereto	10-K	000-25092	10.35	February 2, 2017
21	Subsidiaries of Insight Enterprises, Inc.					X
23.1	Consent of KPMG LLP					X

90

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
24.1	Power of Attorney for Timothy A. Crown dated February 13, 2018						X
24.2	Power of Attorney for Richard E. Allen dated February 13, 2018						X
24.3	Power of Attorney for Bruce W. Armstrong dated February 13, 2018						X
24.4	Power of Attorney for Linda Breard dated February 13, 2018						X
24.5	Power of Attorney for Catherine Courage dated February 13, 2018						X
24.6	Power of Attorney for Bennett Dorrance dated February 8, 2018						X
24.7	Power of Attorney for Michael M. Fisher dated February 13, 2018						X
24.8	Power of Attorney for Anthony A. Ibargüen dated February 13, 2018						X
24.9	Power of Attorney for Kathleen S. Pushor dated February 13, 2018						X
24.10	Power of Attorney for Girish Rishi dated February 13, 2018						X
31.1	Certification of Chief Executive Officer Pursuant to Securities and Exchange Act Rule 13a-14						X
31.2	Certification of Chief Financial Officer Pursuant to Securities and Exchange Act Rule 13a-14						X
32.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002						X
101	Interactive data files pursuant to Rule 405 of Regulation S-T						X

(1) We have entered into a separate indemnification agreement with each of the following directors and executive officers that differ only in names and dates: Richard E. Allen, Bruce W. Armstrong, Linda Breard, Glynis A. Bryan, Catherine Courage, Samuel C. Cowley, Timothy A. Crown, Steven W. Dodenhoff, Bennett Dorrance, Wolfgang Ebermann, Michael M. Fisher, Michael P. Guggemos, Anthony A. Ibargüen, Helen K. Johnson, Kenneth T. Lamneck, Dana A. Leighty, Kathleen S. Pushor and Girish Rishi. Pursuant to the instructions accompanying Item 601 of Regulation S-K, the Registrant is filing the form of such indemnification agreement.

(2) Management contract or compensatory plan or arrangement.

(P) Paper exhibit.

91

INSIGHT ENTERPRISES, INC.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

INSIGHT ENTERPRISES, INC.
By	/s/ Kenneth T. Lamneck
	Kenneth T. Lamneck
	Chief Executive Officer

Dated: February 23, 2018

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Kenneth T. Lamneck Kenneth T. Lamneck	President, Chief Executive Officer and Director (principal executive officer)	February 23, 2018
/s/ Glynis A. Bryan Glynis A. Bryan	Chief Financial Officer (principal financial officer)	February 23, 2018
/s/ Dana A. Leighty Dana A. Leighty	Vice President, Finance (principal accounting officer)	February 23, 2018
/s/ Timothy A. Crown* Timothy A. Crown	Chairman of the Board	February 23, 2018
/s/ Richard E. Allen* Richard E. Allen	Director	February 23, 2018
/s/ Bruce W. Armstrong* Bruce W. Armstrong	Director	February 23, 2018
/s/ Linda Breard* Linda Breard	Director	February 23, 2018
/s/ Catherine Courage* Catherine Courage	Director	February 23, 2018
/s/ Bennett Dorrance* Bennett Dorrance	Director	February 23, 2018
/s/ Michael M. Fisher* Michael M. Fisher	Director	February 23, 2018
/s/ Anthony A. Ibargüen* Anthony A. Ibargüen	Director	February 23, 2018
/s/ Kathleen S. Pushor* Kathleen S. Pushor	Director	February 23, 2018
/s/ Girish Rishi* Girish Rishi	Director	February 23, 2018

* By:	/s/ Samuel C. Cowley
	Samuel C. Cowley, Attorney in Fact

92

EX-21

Exhibit 21

SUBSIDIARIES OF THE REGISTRANT

SUBSIDIARY	STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION
3683371 Canada, Inc.	Canada
Action Computer Supplies Limited (Dormant)	United Kingdom
Action Ltd. (Dormant)	United Kingdom
Bear Data Solutions HK Ltd (Dormant)	Hong Kong
Bear Data Solutions Pte Ltd (Dormant)	Singapore
Bear Data Solutions UK Ltd (Dormant)	United Kingdom
BlueMetal Architects, Inc.	Delaware
Caase Group BV	Netherlands
Caase Services BV	Netherlands
Calence, LLC	Delaware
Calence Physical Security Solutions, LLC	Arizona
Computers by Post Limited (Dormant)	United Kingdom
Datalink Holding LLC (Dormant)	California
Datalink Nevada LLC (Dormant)	Nevada
Docufile Limited (Dormant)	United Kingdom
DSI Data Systems International Limited (Dormant)	United Kingdom
Fraser Associates Ltd (Dormant)	United Kingdom
Ignia Pty Ltd	Australia
Insight Australia Holdings Pty Ltd	Australia
Insight Canada Holdings, Inc.	Arizona
Insight Canada Inc.	Ontario
Insight Consulting Services, LLC	Arizona
Insight Data Technologies Ltd	Ireland
Insight Deutschland GmbH & Ko KG (Dormant)	Germany
Insight Development Corp Limited (Dormant)	United Kingdom
Insight Direct (GB) Limited (Dormant)	United Kingdom
Insight Direct (UK) Limited	United Kingdom
Insight Direct Canada, Inc.	Canada
Insight Direct Services Limited (Dormant)	United Kingdom
Insight Direct USA, Inc.	Illinois
Insight Direct Worldwide, Inc.	Arizona
Insight Enterprises Australia Pty Limited	Australia
Insight Enterprises BV	Netherlands
Insight Enterprises CV	Netherlands
Insight Enterprises UK, Ltd.	United Kingdom
Insight Enterprises Holdings BV	Netherlands
Insight Enterprises Hong Kong	Hong Kong
Insight Enterprises Netherlands BV	Netherlands
Insight Enterprises (NZ) Limited	New Zealand
Insight Enterprises (Shanghai) Co. Ltd	China
Insight Holding (Deutschland) GmbH (Dormant)	Germany
Insight Marketing GmbH (Dormant)	Germany
Insight Networking Solutions Ltd	United Kingdom
Insight North America, Inc.	Arizona
Insight Public Sector, Inc.	Illinois
Insight Receivables Holding, LLC	Illinois
Insight Receivables, LLC	Illinois

Insight Stadium Services, LLC (Dormant)	Arizona
Insight Technology Solutions AB	Sweden
Insight Technology Solutions AG	Switzerland
Insight Technology Solutions ApS	Denmark
Insight Technology Solutions BVBA (Dormant)	Belgium
Insight Technology Solutions GmbH	Austria
Insight Technology Solutions GmbH	Germany
Insight Technology Solutions, Inc.	Delaware
Insight Technology Solutions NUF	Norway
Insight Technology Solutions Oy	Finland
Insight Technology Solutions Pte Ltd	Singapore
Insight Technology Solutions SAS	France
Insight Technology Solutions S.L.	Spain
Insight Technology Solutions SRL	Italy
Insight Technology Solutions s.r.o. (Dormant)	Czech Republic
Insight UK Acquisitions Limited (Dormant)	United Kingdom
Minx Limited (Dormant)	United Kingdom
MV Sub, Inc. (Dormant)	Minnesota
PC Wholesale Ltd (Dormant)	United Kingdom
Pulse Building Limited (Dormant)	United Kingdom
Software Spectrum Holdings Limited (Dormant)	United Kingdom
Software Spectrum (UK) Limited (Dormant)	United Kingdom
Software Spectrum Services BV (Dormant)	Netherlands
SSI Britain Limited (Dormant)	United Kingdom
STI Acquisition (Dormant)	Minnesota

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Insight Enterprises, Inc.:

We consent to the incorporation by reference in the registration statement Nos. 333-147879 and 333-176021 on Form S-8 of Insight Enterprises, Inc. of our reports dated February 23, 2018, with respect to the consolidated balance sheets of Insight Enterprises, Inc. and subsidiaries as of December 31, 2017 and 2016, and the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes (collectively, the “consolidated financial statements”), and the effectiveness of internal control over financial reporting as of December 31, 2017, which reports appear in the December 31, 2017 annual report on Form 10-K of Insight Enterprises, Inc.

/s/ KPMG LLP

Phoenix, Arizona

February 23, 2018

EX-24.1

Exhibit 24.1

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan and Samuel C. Cowley his true and lawful attorneys-in-fact and agents, for him, and in his name, place and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017 and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Timothy A. Crown

Timothy A. Crown

EX-24.2

Exhibit 24.2

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley his true and lawful attorneys-in-fact and agents, for him, and in his name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Richard E. Allen

Richard E. Allen

EX-24.3

Exhibit 24.3

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley his true and lawful attorneys-in-fact and agents, for him, and in his name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Bruce W. Armstrong

Bruce W. Armstrong

EX-24.4

Exhibit 24.4

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley her true and lawful attorneys-in-fact and agents, for her, and in her name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Linda Breard

Linda Breard

EX-24.5

Exhibit 24.5

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley her true and lawful attorneys-in-fact and agents, for her, and in her name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Catherine Courage

Catherine Courage

EX-24.6

Exhibit 24.6

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley his true and lawful attorneys-in-fact and agents, for him, and in his name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 8th day of February, 2018.

/s/ Bennett Dorrance

Bennett Dorrance

EX-24.7

Exhibit 24.7

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley his true and lawful attorneys-in-fact and agents, for him, and in his name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Michael M. Fisher

Michael M. Fisher

EX-24.8

Exhibit 24.8

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley his true and lawful attorneys-in-fact and agents, for him, and in his name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Anthony A. Ibargüen

Anthony A. Ibargüen

EX-24.9

Exhibit 24.9

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley her true and lawful attorneys-in-fact and agents, for her, and in her name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Kathleen S. Pushor

Kathleen S. Pushor

EX-24.10

Exhibit 24.10

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned hereby constitutes and appoints Kenneth T. Lamneck, Glynis A. Bryan, and Samuel C. Cowley her true and lawful attorneys-in-fact and agents, for her, and in her name, place, and stead, in any and all capacities (i) to sign the Insight Enterprises, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2017, and any and all amendments thereto and (ii) to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has duly executed this instrument as of this 13th day of February, 2018.

/s/ Girish Rishi

Girish Rishi

EX-31.1

INSIGHT ENTERPRISES, INC.

Exhibit 31.1

CERTIFICATION

I, Kenneth T. Lamneck, certify that:

1. I have reviewed this Annual Report on Form 10-K of Insight Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 23, 2018

By:	/s/ Kenneth T. Lamneck
	Kenneth T. Lamneck
	Chief Executive Officer

EX-31.2

INSIGHT ENTERPRISES, INC.

Exhibit 31.2

CERTIFICATION

I, Glynis A. Bryan, certify that:

1. I have reviewed this Annual Report on Form 10-K of Insight Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5 The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 23, 2018

By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer

EX-32.1

INSIGHT ENTERPRISES, INC.

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Insight Enterprises, Inc. (the “Company”) on Form 10-K for the period ended December 31, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Kenneth T. Lamneck, Chief Executive Officer of the Company, and Glynis A. Bryan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to the best of our knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Kenneth T. Lamneck
	Kenneth T. Lamneck
	Chief Executive Officer
	February 23, 2018
By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer
	February 23, 2018

XML

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2017	Feb. 15, 2018	Jun. 30, 2017
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Trading Symbol	NSIT
Entity Registrant Name	INSIGHT ENTERPRISES INC
Entity Central Index Key	0000932696
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		35,836,320
Entity Public Float			$ 1,410,322,331

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 105,831	$ 202,882
Accounts receivable, net	1,814,560	1,436,742
Inventories	194,529	148,203
Inventories not available for sale	36,956	68,619
Other current assets	152,467	127,159
Total current assets	2,304,343	1,983,605
Property and equipment, net	75,252	70,910
Goodwill	131,431	62,645
Intangible assets, net	100,778	20,707
Deferred income taxes	17,064	52,347
Other assets	56,783	29,086
Total assets	2,685,651	2,219,300
Current liabilities:
Accounts payable-trade	899,075	1,070,259
Accounts payable-inventory financing facility	319,468	154,930
Accrued expenses and other current liabilities	175,860	151,895
Current portion of long-term debt	16,592	480
Deferred revenue	88,979	61,098
Total current liabilities	1,499,974	1,438,662
Long-term debt	296,576	40,251
Deferred income taxes	717	900
Other liabilities	44,915	26,044
Total liabilities	1,842,182	1,505,857
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, 3,000 shares authorized; no shares issued
Common stock, $0.01 par value, 100,000 shares authorized; 35,829 and 35,484 shares issued and outstanding in 2017 and 2016, respectively	358	355
Additional paid-in capital	317,155	309,650
Retained earnings	550,220	459,537
Accumulated other comprehensive loss - foreign currency translation adjustments	(24,264)	(56,099)
Total stockholders' equity	843,469	713,443
Total liabilities and stockholders' equity	$ 2,685,651	$ 2,219,300

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	3,000,000	3,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	35,829,000	35,484,000
Common stock, shares outstanding	35,829,000	35,484,000

XML

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net sales:
Products									$ 6,038,744	$ 4,997,263	$ 4,945,547
Services									664,879	488,252	427,543
Total net sales	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	6,703,623	5,485,515	5,373,090
Costs of goods sold:
Products									5,512,402	4,571,462	4,513,353
Services									272,651	170,951	143,405
Total costs of goods sold	1,551,192	1,531,892	1,432,653	1,269,316	1,276,614	1,210,908	1,247,017	1,007,874	5,785,053	4,742,413	4,656,758
Gross profit	232,883	226,081	251,379	208,227	190,969	181,808	209,217	161,108	918,570	743,102	716,332
Operating expenses:
Selling and administrative expenses	184,554	180,390	180,752	177,632	145,066	143,872	150,186	146,119	723,328	585,243	584,906
Severance and restructuring expenses	2,791	494	1,022	4,695	1,527	788	909	1,356	9,002	4,580	4,907
Loss on sale of foreign entity		3,646							3,646
Acquisition-related expenses		106	276	2,947	3,706	741			3,329	4,447
Earnings from operations	45,538	41,445	69,329	22,953	40,670	36,407	58,122	13,633	179,265	148,832	126,519
Non-operating (income) expense:
Interest income	(346)	(227)	(205)	(431)	(282)	(318)	(216)	(250)	(1,209)	(1,066)	(783)
Interest expense	5,360	5,555	4,326	3,933	2,271	2,517	1,992	1,848	19,174	8,628	7,224
Net foreign currency exchange loss (gain)	(117)	341	251	380	(520)	579	(153)	616	855	522	(393)
Other expense, net	367	339	326	315	311	352	359	268	1,347	1,290	1,295
Earnings before income taxes	40,274	35,437	64,631	18,756	38,890	33,277	56,140	11,151	159,098	139,458	119,176
Income tax expense	26,106	13,025	24,376	4,908	17,790	11,642	21,073	4,263	68,415	54,768	43,325
Net earnings	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 21,100	$ 21,635	$ 35,067	$ 6,888	$ 90,683	$ 84,690	$ 75,851
Net earnings per share:
Basic	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 0.59	$ 0.61	$ 0.96	$ 0.19	$ 2.54	$ 2.35	$ 2.00
Diluted	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 0.59	$ 0.60	$ 0.96	$ 0.18	$ 2.50	$ 2.32	$ 1.98
Shares used in per share calculations:
Basic	35,809	35,787	35,765	35,602	35,479	35,474	36,380	37,075	35,741	36,102	37,984
Diluted	36,272	36,203	36,169	36,185	35,963	35,790	36,612	37,386	36,207	36,438	38,275

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Statement of Comprehensive Income [Abstract]
Net earnings	$ 90,683	$ 84,690	$ 75,851
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	31,835	(16,063)	(26,707)
Total comprehensive income	$ 122,518	$ 68,627	$ 49,144

XML

Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Treasury Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Loss [Member]	Retained Earnings [Member]
Beginning Balance at Dec. 31, 2014	$ 721,231	$ 401		$ 337,167	$ (13,329)	$ 396,992
Beginning Balance, Shares at Dec. 31, 2014		40,147
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(2,265)	$ 3		(2,268)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		259
Stock-based compensation expense	8,922			8,922
Tax benefit from stock-based compensation	553			553
Repurchase of treasury stock, Amount	(91,843)		$ (91,843)
Repurchase of treasury stock, Shares			(3,300)
Retirement of treasury stock, Amount		$ (33)	$ 91,843	(27,688)		(64,122)
Retirement of treasury stock, Shares		(3,300)	3,300
Foreign currency translation adjustments, net of tax	(26,707)				(26,707)
Net earnings	75,851					75,851
Ending Balance at Dec. 31, 2015	685,742	$ 371		316,686	(40,036)	408,721
Ending Balance, Shares at Dec. 31, 2015		37,106
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(2,219)	$ 3		(2,222)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		269
Stock-based compensation expense	11,058			11,058
Tax benefit from stock-based compensation	235			235
Repurchase of treasury stock, Amount	(50,000)		$ (50,000)
Repurchase of treasury stock, Shares			(1,891)
Retirement of treasury stock, Amount		$ (19)	$ 50,000	(16,107)		(33,874)
Retirement of treasury stock, Shares		(1,891)	1,891
Foreign currency translation adjustments, net of tax	(16,063)				(16,063)
Net earnings	84,690					84,690
Ending Balance at Dec. 31, 2016	713,443	$ 355		309,650	(56,099)	459,537
Ending Balance, Shares at Dec. 31, 2016		35,484
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(5,318)	$ 3		(5,321)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		345
Stock-based compensation expense	12,826			12,826
Foreign currency translation adjustments, net of tax	31,835				31,835
Net earnings	90,683					90,683
Ending Balance at Dec. 31, 2017	$ 843,469	$ 358		$ 317,155	$ (24,264)	$ 550,220
Ending Balance, Shares at Dec. 31, 2017		35,829

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Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Cash flows from operating activities:
Net earnings	$ 90,683,000	$ 84,690,000	$ 75,851,000
Adjustments to reconcile net earnings to net cash (used in) provided by operating activities:
Depreciation and amortization of property and equipment	25,787,000	27,493,000	26,649,000
Amortization of intangible assets	16,812,000	10,637,000	11,308,000
Non-cash real estate impairment			800,000
Provision for losses on accounts receivable	5,245,000	2,452,000	6,761,000
Write-downs of inventories	2,776,000	2,934,000	3,997,000
Write-off of property and equipment	418,000	0	535,000
Non-cash stock-based compensation	12,826,000	11,058,000	8,922,000
Deferred income taxes	19,139,000	10,517,000	5,174,000
Loss on sale of foreign entity	3,646,000
Gain on sale of real estate		(338,000)
Changes in assets and liabilities:
Increase in accounts receivable	(208,065,000)	(168,966,000)	(47,206,000)
Increase in inventories	(14,046,000)	(50,712,000)	(9,214,000)
Decrease (increase) in other assets	4,982,000	(50,130,000)	(26,714,000)
(Decrease) increase in accounts payable	(237,457,000)	193,582,000	113,594,000
(Decrease) increase in deferred revenue	(27,184,000)	10,633,000	2,927,000
(Decrease) increase in accrued expenses and other liabilities	(988,000)	12,278,000	7,718,000
Net cash (used in) provided by operating activities	(305,426,000)	96,128,000	181,102,000
Cash flows from investing activities:
Acquisitions, net of cash and cash equivalents acquired	(186,932,000)	(10,297,000)	(44,221,000)
Purchases of property and equipment	(19,230,000)	(12,266,000)	(13,416,000)
Proceeds from sale of foreign entity	1,517,000
Proceeds from sale of real estate, net		1,378,000
Net cash used in investing activities	(204,645,000)	(21,185,000)	(57,637,000)
Cash flows from financing activities:
Borrowings on senior revolving credit facility	1,151,216,000	772,218,000	686,410,000
Repayments on senior revolving credit facility	(1,033,716,000)	(772,218,000)	(686,410,000)
Borrowings on accounts receivable securitization financing facility	3,961,389,000	2,802,000,000	1,897,100,000
Repayments on accounts receivable securitization financing facility	(3,975,889,000)	(2,851,500,000)	(1,869,100,000)
Borrowings under Term Loan A	175,000,000
Repayments under Term Loan A	(8,750,000)
Repayments under other financing agreements	(5,636,000)	(1,309,000)	(543,000)
Payments on capital lease obligations	(1,089,000)	(445,000)	(223,000)
Net borrowings (repayments) under inventory financing facility	141,037,000	48,603,000	(16,454,000)
Payment of debt issuance costs	(1,123,000)	(3,360,000)
Payment of payroll taxes on stock-based compensation through shares withheld	(5,318,000)	(2,219,000)	(2,265,000)
Repurchases of common stock		(50,000,000)	(91,843,000)
Net cash provided by (used in) financing activities	397,121,000	(58,230,000)	(83,328,000)
Foreign currency exchange effect on cash and cash equivalent balances	15,899,000	(1,809,000)	(16,683,000)
(Decrease) increase in cash and cash equivalents	(97,051,000)	14,904,000	23,454,000
Cash and cash equivalents at beginning of year	202,882,000	187,978,000	164,524,000
Cash and cash equivalents at end of year	$ 105,831,000	$ 202,882,000	$ 187,978,000

XML

Operations and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Operations and Summary of Significant Accounting Policies

(1) Operations and Summary of Significant Accounting Policies

Description of Business

We are a Fortune 500 global information technology (“IT”) provider helping businesses of all sizes – from small and medium sized firms to worldwide enterprises, governments, schools and health care organizations – define, architect, implement and manage Intelligent Technology Solutions^TM. We empower our clients to manage their IT environments so they can drive meaningful business outcomes today and transform their operations for tomorrow. Our company is organized in the following three operating segments, which are primarily defined by their related geographies:

Operating Segment	Geography
North America	United States and Canada
EMEA	Europe, Middle East and Africa
APAC	Asia-Pacific

Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services. A discussion of changes in our classification of certain revenue streams during 2017, can be found in Note 20. Prior year results were reclassified to conform to the current year presentation. These reclassifications had no effect on consolidated total net sales.

Acquisitions

Effective September 26, 2017, we acquired Caase Group B.V. (referred to herein as, “Caase.com”), a Dutch cloud service provider, for a purchase price, net of cash acquired, of approximately $6,038,000, subject to a final working capital adjustment. The acquisition was funded using cash on hand.

Effective January 6, 2017, we acquired Datalink Corporation (“Datalink”), a leading provider of IT services and enterprise data center solutions based in Eden Prairie, Minnesota, for a cash purchase price of $257,456,000, which included cash and cash equivalents acquired of $76,597,000. The acquisition was funded using cash on hand and borrowings under our revolving facility in the form of an incremental Term Loan A (“TLA”).

Effective September 1, 2016, we acquired Ignia Pty Ltd (“Ignia”), a business technology consulting and managed services provider headquartered in Perth, Australia, with an additional office in Melbourne, for a cash purchase price, net of cash acquired, of approximately $10,804,000. The acquisition was funded using cash on hand.

Effective October 1, 2015, we acquired BlueMetal Architects, Inc. (“BlueMetal”), an interactive design and technology architecture firm based in the Boston area with offices in Chicago and New York, for a cash purchase price, net of cash acquired, of approximately $44,221,000. The acquisition was funded using borrowings under our accounts receivable securitization financing facility.

Our results of operations include the results of Caase.com, Datalink, Ignia and BlueMetal from their respective acquisition dates. (See Note 21 for a discussion of our acquisitions.)

Principles of Consolidation and Presentation

The consolidated financial statements include the accounts of Insight Enterprises, Inc. and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. References to “the Company,” “Insight,” “we,” “us,” “our” and other similar words refer to Insight Enterprises, Inc. and its consolidated subsidiaries, unless the context suggests otherwise.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Additionally, these estimates and assumptions affect the reported amounts of net sales and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts, valuation of inventories, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

Cash and Cash Equivalents

We consider all highly liquid investments with maturities at the date of purchase of three months or less to be cash equivalents.    

Book overdrafts represent the amount by which outstanding checks issued, but not yet presented to our banks for disbursement, exceed balances on deposit in applicable bank accounts and a legal right of offset with our positive cash balances in other financial institution accounts does not exist. Our book overdrafts, which are not directly linked to a credit facility or other bank overdraft arrangement, do not result in an actual bank financing, but rather constitute normal unpaid trade payables at the end of a reporting period. These amounts are included within our accounts payable balance in our consolidated balance sheets. The changes in these book overdrafts are included within the changes in accounts payable line item as a component of cash flows from operating activities in our consolidated statements of cash flows.

Allowance for Doubtful Accounts

We establish an allowance for doubtful accounts to reflect our best estimate of probable losses inherent in our accounts receivable balance. The allowance is based on our evaluation of the aging of the receivables, historical write-offs and the current economic environment. We write off individual accounts against the reserve when we no longer believe that it is probable that we will collect the receivable because we become aware of a client’s or partner’s inability to meet its financial obligations. Such awareness may be as a result of bankruptcy filings, or deterioration in the client’s or partner’s operating results or financial position.

Inventories

We state inventories, principally purchased IT hardware, at the lower of weighted average cost (which approximates cost under the first-in, first-out method) or net realizable value. We evaluate inventories for excess, obsolescence or other factors that may render inventories unmarketable at normal margins. Write-downs are recorded so that inventories reflect the approximate net realizable value and take into account contractual provisions with our partners governing price protection, stock rotation and return privileges relating to obsolescence. Because of the large number of transactions and the complexity of managing the price protection and stock rotation process, estimates are made regarding write-downs of the carrying amount of inventories. Additionally, assumptions about future demand, market conditions and decisions by manufacturers/publishers to discontinue certain products or product lines can affect our decision to write down inventories.

Inventories not available for sale relate to product sales transactions in which we are warehousing the product and will be deploying the product to our clients’ designated locations subsequent to period-end. Additionally, we may perform services on a portion of the product prior to shipment to our clients and will be paid a fee for doing so. Although these product contracts are non-cancelable with customary credit terms beginning the date the inventories are segregated in our warehouse and invoiced to the client and the warranty periods begin on the date of invoice, these transactions do not meet the sales recognition criteria under GAAP. Therefore, we do not record sales and the inventories are classified as inventories not available for sale on our consolidated balance sheet until the product is delivered. If clients remit payment before we deliver the product to them, we record the payments received as deferred revenue on our consolidated balance sheet until such time as the product is delivered.

Property and Equipment

We record property and equipment at cost. We capitalize major improvements and betterments, while maintenance, repairs and minor replacements are expensed as incurred. Depreciation or amortization is provided using the straight-line method over the following estimated economic lives of the assets:

	Estimated Economic Life
Leasehold improvements	Shorter of underlying lease term or asset life
Furniture and fixtures	2 – 7 years
Equipment	3 – 5 years
Software	3 – 10 years
Buildings	29 years

Costs incurred to develop internal-use software during the application development stage, including capitalized interest, are recorded in property and equipment at cost. External direct costs of materials and services consumed in developing or obtaining internal-use computer software and payroll and payroll-related costs for teammates who are directly associated with and who devote time to internal-use computer software development projects, to the extent of the time spent directly on the project and specific to application development, are capitalized.

Reviews are regularly performed to determine whether facts and circumstances exist which indicate that the useful life is shorter than originally estimated or the carrying amount of assets may not be recoverable. When an indication exists that the carrying amount of long-lived assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

Goodwill

Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of net identified tangible and intangible assets acquired. Goodwill is tested for impairment at the reporting unit level on an annual basis in the fourth quarter and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. We may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform a quantitative goodwill impairment test. Otherwise, the goodwill impairment test is not required. The quantitative goodwill impairment review process compares the fair value of the reporting unit in which goodwill resides to its carrying value. The Company has three reporting units, which are the same as our operating segments. Multiple valuation techniques can be used to assess the fair value of the reporting unit. All of these techniques include the use of estimates and assumptions that are inherently uncertain. Changes in these estimates and assumptions could materially affect the determination of fair value or goodwill impairment, or both.

Intangible Assets

We amortize intangible assets acquired in business combinations using the straight-line method over the following estimated economic lives of the intangible assets from the date of acquisition:

	Estimated Economic Life
Customer relationships	2 –11 years
Tradenames and Restrictive Covenant Agreements	9 months –3 years

We regularly perform reviews to determine if facts and circumstances exist which indicate that the useful lives of our intangible assets are shorter than originally estimated or the carrying amount of these assets may not be recoverable. When an indication exists that the carrying amount of intangible assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

Trade Credits

Trade credit liabilities arise from aged unclaimed credit memos, duplicate payments, payments for returned product or overpayments made to us by our clients, and, to a lesser extent, from goods received by us from a partner for which we were never invoiced. Trade credit liabilities are included in accrued expenses and other current liabilities in our consolidated balance sheets. We derecognize the liability only if it has been extinguished, upon either (1) our payment of the liability to relieve our obligation or (2) our legal release from the related obligation, which is recorded as a reduction of costs of goods sold.

Self-Insurance

We are self-insured in the United States for medical insurance up to certain annual stop-loss limits and workers’ compensation claims up to certain deductible limits. We establish reserves for claims, both reported and incurred but not reported, using currently available information as well as our historical claims experience.

Treasury Stock

We record repurchases of our common stock as treasury stock at cost. We also record the subsequent retirement of these treasury shares at cost. The excess of the cost of the shares retired over their par value is allocated between additional paid-in capital and retained earnings. The amount recorded as a reduction of paid-in capital is based on the excess of the average original issue price of the shares over par value. The remaining amount is recorded as a reduction of retained earnings.

Sales Recognition

Sales are recognized when title and risk of loss are passed to the client, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable and collectibility is reasonably assured. Our standard sales terms are F.O.B. shipping point or equivalent, at which time title and risk of loss have passed to the client. However, because we either (i) have a general practice of covering client losses while products are in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) have specifically stated F.O.B. destination contractual terms with the client, delivery is not deemed to have occurred until the point in time when the product is received by the client. We make provisions for estimated product returns that we expect to occur under our return policy based upon historical return rates.

We leverage drop-shipment arrangements with many of our partners and suppliers to deliver products to our clients without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs. We recognize revenue for drop-shipment arrangements on a gross basis when the product is received by the client. We recognize revenue on a gross basis as the principal in the transaction because we control the transaction as the primary obligor for product fulfillment in the arrangement, we assume inventory risk if the product is returned by the client, we set the price of the product charged to the client, we assume credit risk for the amounts invoiced, and we work closely with our clients to determine their hardware and software specifications.

We record the freight we bill to our clients as net sales and the related freight costs we pay as costs of goods sold. We report sales net of any sales-based taxes assessed by governmental authorities that are imposed on and concurrent with sales transactions.

Revenue is recognized from software sales when clients acquire the right to use or copy software under license, but in no case prior to the commencement of the term of the initial software license agreement, provided that all other revenue recognition criteria have been met (i.e., evidence of the arrangement exists, the fee is fixed or determinable and collectibility of the fee is probable).

We sell certain third-party service contracts, software maintenance and cloud or software-as-a-service subscription products for which we are not the primary obligor. These sales do not meet the criteria for gross sales recognition, and thus are recorded on a net sales recognition basis. As we enter into contracts with third-party service providers or vendors and our clients, we evaluate whether the subsequent sales of such services should be recorded as gross sales or net sales. We determine whether we act as a principal in the transaction and assume the risks and rewards of ownership or if we are simply acting as an agent or broker. Under gross sales recognition, the selling price is recorded in sales and our cost to the third-party service provider or vendor is recorded in costs of goods sold. Under net sales recognition, the cost to the third-party service provider or vendor is recorded as a reduction to sales, resulting in net sales equal to the gross profit on the transaction, and there are no costs of goods sold.

We recognize revenue for sales of services ratably over the time period over which the service will be provided if there is no discernible pattern of recognition of the cost to perform the service. Billings for such services that are made in advance of the related revenue recognized are recorded as deferred revenue and recognized as revenue ratably over the billing coverage period. Revenue from certain arrangements that allow for the use of a product or service over a period of time without taking possession of software are also accounted for ratably over the time period over which the service will be provided.

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred as the services are performed and amounts are earned. Net sales for these services engagements are not a significant portion of our consolidated net sales.

Additionally, we sell certain professional services contracts on a fixed fee basis. Revenues for fixed fee professional services contracts are recognized based on the ratio of costs incurred to total estimated costs. Net sales for these service contracts are not a significant portion of our consolidated net sales.

In certain arrangements, we may provide a combination of hardware and software products and the provision of services. Services that are performed by us in conjunction with hardware and software sales that are completed in our facilities prior to shipment of the product are recognized upon delivery, when title passes to the client, for the hardware sale. Net sales of services that are performed at client locations are primarily service-only contracts and are recorded as sales when the services are performed. The total consideration for an arrangement with multiple deliverables is allocated to all deliverables that represent a separate unit of accounting using the relative selling price method.

Costs of Goods Sold

Costs of goods sold include product costs, direct costs incurred associated with delivering services, outbound and inbound freight costs and provisions for inventory reserves. These costs are reduced by provisions for supplier discounts and certain payments and credits received from partners, as described under “Partner Funding” below.

Selling and Administrative Expenses

Selling and administrative expenses include salaries and wages, bonuses and incentives, stock-based compensation expense, employee-related expenses, facility-related expenses, marketing and advertising expense, reduced by certain payments and credits received from partners related to shared marketing expense programs, as described under “Partner Funding” below, depreciation of property and equipment, professional fees, amortization of intangible assets, provisions for losses on accounts receivable and other operating expenses.

Partner Funding

We receive payments and credits from partners, including consideration pursuant to volume sales incentive programs, volume purchase incentive programs and shared marketing expense programs. Partner funding received pursuant to volume sales incentive programs is recognized as it is earned as a reduction to costs of goods sold. Partner funding received pursuant to volume purchase incentive programs is allocated as a reduction to inventories based on the applicable incentives earned from each partner and is recorded in cost of goods sold as the related inventory is sold. Partner funding received pursuant to shared marketing expense programs is recorded as it is earned as a reduction of the related selling and administrative expenses in the period the program takes place if the consideration represents a reimbursement of specific, incremental, identifiable costs. Consideration that exceeds the specific, incremental, identifiable costs is classified as a reduction of costs of goods sold. The amount of partner funding recorded as a reduction of selling and administrative expenses in our statements of operations totaled $53,227,000, $48,114,000 and $45,146,000 in 2017, 2016 and 2015, respectively.

Concentrations of Risk

Credit Risk

Although we are affected by the international economic climate, management does not believe material credit risk concentration existed at December 31, 2017. We monitor our clients’ financial condition and do not require collateral. Sales to the U.S. federal government, which are diversified across multiple agencies and departments, collectively accounts for approximately 9% of our 2017 net sales. Excluding these sales to the federal government, we are not reliant on any one client. No single client accounted for more than 4% of our consolidated net sales in 2017.

Supplier Risk

Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2017. No other partner accounted for more than 10% of purchases in 2017. Our top five partners as a group for 2017 were Microsoft, Cisco Systems, Tech Data (a distributor), Dell and HP Inc., and approximately 60% of our total purchases during 2017 came from this group of partners. Although brand names and individual products are important to our business, we believe that competitive sources of supply are available in substantially all of our product categories such that, with the exception of Microsoft, we are not dependent on any single partner for sourcing products.

Advertising Costs

Advertising costs are expensed as they are incurred. Advertising expense of $47,053,000, $37,565,000 and $33,568,000 was recorded in 2017, 2016 and 2015, respectively. These amounts were predominantly offset by partner funding earned pursuant to shared marketing expense programs recorded as a reduction of selling and administrative expenses, as discussed in “Partner Funding” above.

Stock-Based Compensation

Stock-based compensation is measured based on the fair value of the award on the date of grant and the corresponding expense is recognized over the period during which an employee is required to provide service in exchange for the reward. Stock-based compensation expense is classified in the same line item of our consolidated statements of operations as other payroll-related expenses specific to the employee. Compensation expense related to service-based restricted stock units (“RSUs”) is recognized on a straight-line basis over the requisite service period for the entire award. Compensation expense related to performance-based RSUs is recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards (i.e., a graded vesting basis).

Foreign Currencies

We use the U.S. dollar as our reporting currency. The functional currencies of our foreign subsidiaries are the local currencies. Accordingly, assets and liabilities of the subsidiaries are translated into U.S. dollars at the exchange rate in effect at the balance sheet dates. Income and expense items are translated at the average exchange rate for each month within the year. The resulting translation adjustments are recorded directly in accumulated other comprehensive income, net of tax – foreign currency translation adjustments as a separate component of stockholders’ equity. Net foreign currency transaction gains/losses, including transaction gains/losses on intercompany balances that are not of a long-term investment nature and non-functional currency cash balances, are reported as a separate component of non-operating (income) expense in our consolidated statements of operations.

Derivative Financial Instruments

We enter into forward foreign exchange contracts to mitigate the risk of non-functional currency monetary assets and liabilities on our consolidated financial statements. These forward contracts are not designated as hedge instruments. The fair value of all derivative assets and liabilities are recorded gross in the other current assets and accrued expenses and other current liabilities sections of our consolidated balance sheets. Gains/losses are recorded net in non-operating (income) expense in our consolidated statements of operations.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable earnings in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date.

We recognize net deferred tax assets to the extent that we believe these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and results of recent operations. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

We record uncertain tax positions on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Interest and penalties related to unrecognized tax benefits are recognized within the income tax expense line in our consolidated statements of operations. Accrued interest and penalties are included within the related tax liability line in our consolidated balance sheets.

Net Earnings Per Share (“EPS”)

Basic EPS is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during each year. Diluted EPS is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding RSUs. A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Years Ended December 31,
	2017		2016		2015
Numerator:
Net earnings	$	90,683	$	84,690	$	75,851
Denominator:
Weighted-average shares used to compute basic EPS		35,741		36,102		37,984
Dilutive potential common shares due to dilutive RSUs, net of tax effect		466		336		291
Weighted-average shares used to compute diluted EPS		36,207		36,438		38,275
Net earnings per share:
Basic	$	2.54	$	2.35	$	2.00
Diluted	$	2.50	$	2.32	$	1.98

In 2017, 2016 and 2015, approximately 40,000, 36,000 and 1,000, respectively, of our RSUs were not included in the diluted EPS calculations because their inclusion would have been anti-dilutive. These share-based awards could be dilutive in the future.                

Recently Issued Accounting Standards

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2017-04, “Simplifying the Test for Goodwill Impairment.” The new standard requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The new standard is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. We adopted this new standard when we performed our annual goodwill impairment analysis for 2017 in the fourth quarter of 2017 and applied it prospectively. The adoption of this standard did not have a material effect on our consolidated financial statements. See “Goodwill” above for further details about our test for goodwill impairment.

In November 2016, the FASB issued ASU No. 2016-18, “Restricted Cash.” The new standard requires companies to include cash and cash equivalents that have restrictions on withdrawal or use within total cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. The new standard is required to be adopted retrospectively. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments.” The new standard is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. It addresses eight specific cash flow issues to clarify the presentation and classification of cash receipts and cash payments in the statement of cash flows. The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. The new standard is required to be adopted retrospectively. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting.” This new standard simplifies the accounting for share-based payment transactions, including the income tax consequences, the calculation of diluted earnings per share, the treatment of forfeitures, the classification of awards as either equity or liabilities and the classification on the statement of cash flows. This new standard increases volatility in the statement of operations by requiring all excess tax benefits and deficiencies to be recognized as income tax benefit or expense in the statement of operations and treated as discrete items in the period in which they occur. We adopted the new standard as of January 1, 2017, and prospectively applied the provisions in this guidance requiring recognition of excess tax benefits and deficits in the statement of operations, which resulted in an income tax benefit of $2,483,000 for the year ended December 31, 2017. The corresponding increase in net earnings equated to $0.07 per diluted share during the year ended December 31, 2017. Also, as a result of the adoption of the new standard, we made an accounting policy election to recognize forfeitures as they occur and no longer estimate expected forfeitures. The provisions in this guidance requiring the use of a modified retrospective transition method would have required us to record a cumulative effect adjustment in retained earnings as of January 1, 2017. We elected not to adjust retained earnings and to record such cumulative effect adjustment as stock-based compensation in the first quarter of 2017 on the basis of immateriality. Lastly, we applied the provisions of this guidance relating to classification on the statement of cash flows retrospectively. As a result, excess tax benefits from employee gains on stock-based compensation of $323,000 and $592,000 were reclassified from cash flows from financing activities to cash flows from operating activities for the years ended December 31, 2016 and 2015, respectively, to conform to the current period presentation.

In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which supersedes the existing lease recognition requirements in the existing accounting standard for leases. The core principal of the new standard is that an entity should recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years. Early adoption is permitted. The new standard is to be applied using a modified retrospective transition method with the option to elect a number of practical expedients. We expect to adopt the new standard in the first quarter of 2019 and are in the process of determining the effect that the adoption of ASU 2016-02 will have on our consolidated financial statements and disclosures. We have not yet selected our planned transition approach.

In January 2016, the FASB issues ASU No. 2016-01, “Financial Instruments Overview: Recognition and Measurement of Financial Assets and Financial Liabilities.” The new standard amends the guidance on the classification and measurement of financial instruments and changes the accounting for investments in equity securities. The new standard is effective for annual and interim periods in fiscal years beginning after December 15, 2017, and early adoption is permitted. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” This standard changes the measurement from lower of cost or market to lower of cost and net realizable value. We adopted the standard in the first quarter of 2017 and applied the provisions prospectively. The standard did not have a material effect on our consolidated financial statements.

On May 28, 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” which amends the existing accounting standards for revenue recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard, as amended, will be effective for the Company beginning in the first quarter of 2018. The standard permits two methods of adoption: retrospectively to each prior reporting period presented (the full retrospective transition method) or retrospectively with the cumulative effect adjustment of initially applying the new standard recognized at the date of initial application (the modified retrospective transition method).

We will adopt the standard as of January 1, 2018, and will utilize the modified retrospective transition method. While we are still finalizing our accounting policies under the new standard and are in the process of quantifying the cumulative effect adjustment from prior periods that will be recognized in our consolidated balance sheet as of the date of adoption as an adjustment to retained earnings, to date we have concluded:

• In sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we will change to record both the software license and the accompanying software maintenance on a net basis, as the agent in the arrangement. Under current guidance, we bifurcate the sale of the software license from the sale of the maintenance contract, record the sale of the software product on a gross basis, as the principal in the arrangement, and record the sale of the software maintenance on a net basis, as an agent in the arrangement. This change will lead us to report lower net sales in future periods related to security software products. This change will have no effect on gross profit dollars, but all other things being equal, gross margin for these specific sales would increase compared to prior years.

• The accounting for inventories not available for sale, otherwise known as bill and hold arrangements, will change such that a portion of revenue under the contracts will be recognized earlier than we are recognizing under current accounting standards. Bill and hold arrangements are inventory balances owned and paid for by our clients, but for which we are warehousing the product and will be deploying it to the clients’ locations in a future period.

• The accounting for renewals of certain software term licenses will change to delay revenue recognition until the beginning of the renewal period. Under current guidance, we recognize revenue as the renewal order is completed. We do not believe this change will have a material effect on our sales or profitability trends, as it is only a change in timing of recognition between periods.

• Sales commissions on contracts with performance periods that exceed one year will be recorded as an asset and amortized to expense over the related contract performance period as opposed to being expensed in the period the transaction is generated.

Our analysis and evaluation of the new standard will continue through to when we publish our first quarter of 2018 results. A substantial amount of work has been completed, and findings and progress to date have been reported to management and the Audit Committee. Although we currently believe that the changes overall resulting from the adoption of the new standard will not lead to operating trends that are materially different than we reported in prior years, our evaluation of the effects is still being finalized. Currently, we estimate the total cumulative effect adjustment from prior periods that will be recognized in our consolidated balance sheet as of the date of adoption as an adjustment to retained earnings to be less than $10,000,000, on a pretax basis.

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Property and Equipment

12 Months Ended

Dec. 31, 2017

Property, Plant and Equipment [Abstract]

Property and Equipment

(2) Property and Equipment

Property and equipment consist of the following (in thousands):

	December 31,
	2017			2016
Software	$	171,701		$	159,442
Buildings		65,468			63,253
Equipment		103,542			93,553
Furniture and fixtures		38,459			36,526
Leasehold improvements		25,981			21,132
Land		5,179			5,131
		410,330			379,037
Accumulated depreciation and amortization		(335,078	)		(308,127	)
Property and equipment, net	$	75,252		$	70,910

We periodically assess whether any indicators of impairment existed related to our property and equipment. We incurred non-cash charges of $418,000 and $535,000 during 2017 and 2015, respectively, to write-off certain property and equipment. No such charges were incurred in 2016.

Depreciation and amortization expense related to property and equipment was $25,787,000, $27,493,000 and $26,649,000 in 2017, 2016 and 2015, respectively. Interest charges capitalized in connection with internal-use software development projects in 2017, 2016 and 2015 were immaterial.

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Goodwill

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

(3) Goodwill

The changes in the carrying amount of goodwill for the year ended December 31, 2017 are as follows (in thousands):

	North America			EMEA			APAC			Consolidated
Goodwill	$	379,617		$	151,439		$	13,973		$	545,029
Accumulated impairment losses		(323,422	)		(151,439	)		(13,973	)		(488,834	)
Goodwill acquired during 2016		(507	)		—			6,957			6,450
Balance at December 31, 2016		55,688			—			6,957			62,645
Goodwill acquired during 2017		64,140			4,041			605			68,786
Balance at December 31, 2017	$	119,828		$	4,041		$	7,562		$	131,431

On September 26, 2017, we acquired Caase.com, which has been integrated into our EMEA business. Under the purchase method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired of approximately $4,041,000 was recorded as goodwill in the EMEA reporting unit (see Note 21). The primary driver for this acquisition was to strengthen our ability to deliver Intelligent Technology Solutions to our clients in the Netherlands, with a view to expand into the wider European region in the near future.

On January 6, 2017, we acquired Datalink, which has been integrated into our North America business. Under the purchase method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired of approximately $64,140,000 was recorded as goodwill in the North America reporting unit (see Note 21). The primary driver for this acquisition was to strengthen our position as a leading IT solutions provider with deep technical talent delivering data center solutions to clients on premise or in the cloud.                

On September 1, 2016, we acquired Ignia, which has been integrated into our APAC business. Under the purchase method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired of approximately $6,957,000 was recorded as goodwill in the APAC reporting unit (see Note 21). The primary driver for this acquisition was to expand our global footprint in the areas of application design, digital solutions, cloud, mobility and business analytics, while also building on our unique position to bring solutions powered by Intelligent Technology™ to our clients in the Asia-Pacific region. The change in goodwill in our APAC operating segment as of December 31, 2017 compared to the balance as of December 31, 2016 resulted from a final working capital adjustment of $35,000 during the year and foreign currency translation adjustments associated with the goodwill balance.

On October 1, 2015, we acquired BlueMetal, which has been integrated into our North America business. In 2016, we resolved the working capital contingency associated with the acquisition of BlueMetal. We recorded the adjustment of the purchase price allocation as a reduction of goodwill in our North America operating segment upon the receipt of $507,000 in cash during 2016.

During 2017, we periodically assessed whether any indicators of impairment existed which would require us to perform an interim impairment review. As of each interim period end during the year, we concluded that a triggering event had not occurred that would more likely than not reduce the fair value of our reporting units below their carrying values. We performed our annual test of goodwill for impairment during the fourth quarter of 2017. The results of the goodwill impairment test indicated that the fair values of our North America, EMEA and APAC reporting units, estimated using the market approach, were in excess of their respective carrying values.

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Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

(4) Intangible Assets

Intangible assets consist of the following (in thousands):

	December 31,
	2017			2016
Customer relationships	$	133,660		$	41,711
Other		4,475			1,978
		138,135			43,689
Accumulated amortization		(37,357	)		(22,982	)
Intangible assets, net	$	100,778		$	20,707

In March and December 2017, respectively, the customer relationship intangible assets associated with the 2012 acquisition of Inmac and the 2011 acquisition of Ensynch were fully amortized. As such, the gross intangible assets balance and the accumulated amortization balance were both reduced by approximately $2,516,000, which had no effect on the net intangible assets balance reported in the accompanying consolidated balance sheet as of December 31, 2017.

In September 2016, the customer relationship intangible assets associated with the 2006 acquisition of Software Spectrum Inc. and the 2008 acquisition of MINX Limited in the United Kingdom were fully amortized. As such, the gross intangible assets balance and the accumulated amortization balance were both reduced by approximately $81,817,000, which had no effect on the net intangible assets balance reported in the accompanying consolidated balance sheet as of December 31, 2016.

During 2017, we periodically assessed whether any indicators of impairment existed related to our intangible assets. As of each interim period end during the year, we concluded that a triggering event had not occurred that would more likely than not reduce the fair value of our intangible assets below their carrying values.    

Amortization expense recognized in 2017, 2016 and 2015 was $16,812,000, $10,637,000 and $11,308,000, respectively. Future amortization expense for the remaining unamortized balance as of December 31, 2017 is estimated as follows (in thousands):

Years Ending December 31,	Amortization Expense
2018	$	14,260
2019		11,690
2020		11,677
2021		11,638
2022		11,638
Thereafter		39,875
Total amortization expense	$	100,778

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Accounts Payable - Inventory Financing Facility

12 Months Ended

Dec. 31, 2017

Payables and Accruals [Abstract]

Accounts Payable - Inventory Financing Facility

(5) Accounts Payable - Inventory Financing Facility

We have entered into an agreement with a financial intermediary to facilitate the purchase of inventory from various suppliers under certain terms and conditions, as described below. These amounts are classified separately as accounts payable - inventory financing facility in the accompanying consolidated balance sheets.

The aggregate availability for vendor purchases under our inventory financing facility is $325,000,000. From time to time and at our option, we may request to increase the aggregate amount available under the inventory financing facility by up to an aggregate of $25,000,000, subject to customary conditions. The facility matures on June 23, 2021. Additionally, the facility may be renewed under certain circumstances described in the agreement for successive 12-month periods. Interest does not accrue on accounts payable under this facility provided the accounts payable are paid within stated vendor terms (typically 60 days). We impute interest on the average daily balance outstanding during these stated vendor terms based on our blended incremental borrowing rate during the period under our senior revolving credit facility and our accounts receivable securitization financing facility. Imputed interest of $6,736,000, $3,385,000 and $3,406,000 was recorded in 2017, 2016 and 2015, respectively. If balances are not paid within stated vendor terms, they will accrue interest at prime plus 1.25%. The facility is guaranteed by the Company and each of its material domestic subsidiaries and is secured by a lien on substantially all of the Company’s and each guarantor’s assets.

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Debt, Capital Lease and Other Financing Obligations

12 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Debt, Capital Lease and Other Financing Obligations

(6) Debt, Capital Lease and Other Financing Obligations

Debt

Our long-term debt consists of the following (in thousands):

	December 31,
	2017			2016
Senior revolving credit facility	$	117,500		$	—
Term Loan A (less unamortized debt issuance costs of $873)		165,377			—
Accounts receivable securitization financing facility		25,000			39,500
Capital leases and other financing obligations		5,291			1,231
Total		313,168			40,731
Less: current portion of long-term debt		(16,592	)		(480	)
Long-term debt	$	296,576		$	40,251

Our senior revolving credit facility (“revolving facility”) is used for general corporate purposes, which may include acquisitions and share repurchases, and may be used for borrowings in certain foreign currencies and for letters of credit, in each case up to specified sublimits. The revolving facility has an aggregate U.S. dollar equivalent maximum borrowing amount of $350,000,000, including a maximum borrowing capacity that may be used for borrowing in certain foreign currencies of $50,000,000. On January 6, 2017, we amended our revolving facility to expand the facility by $175,000,000 in the form of an incremental Term Loan A (“TLA”). Pricing and all other general terms and conditions of the TLA are governed by the existing revolving facility. The TLA requires amortization payments of 5%, 7.5%, 10%, 12.5% and 15% of the original principal balance in years one through five, respectively, to be paid quarterly through March 31, 2021, with the remaining balance of $107,187,500 due at maturity on June 23, 2021. The revolving facility and TLA are guaranteed by the Company’s material domestic subsidiaries and are secured by a lien on substantially all of the Company’s and each guarantor’s assets.

The interest rates applicable to borrowings under the revolving facility and the TLA are based on the leverage ratio of the Company as set forth on a pricing grid in the agreement. Amounts outstanding under the revolving facility and TLA bear interest, payable quarterly, at a floating rate equal to the prime rate plus a predetermined spread of 0.00% to 0.75% or, at our option, a LIBOR rate plus a pre-determined spread of 1.25% to 2.25%. The floating interest rate applicable at December 31, 2017 was 3.49% per annum for the revolving facility and 3.57% per annum for the TLA. In addition, we pay a quarterly commitment fee on the unused portion of the facility of 0.25% to 0.45%, and our letter of credit participation fee ranges from 1.25% to 2.25%. During 2017, 2016 and 2015, due to availability under our ABS facility, weighted average borrowings under our revolving facility were $63,604,000, $35,811,000 and $21,987,000, respectively. Interest expense associated with the revolving facility and TLA was $8,491,000, $2,191,000 and $1,813,000 in 2017, 2016 and 2015, respectively, including the commitment fee and amortization of deferred financing fees. As of December 31, 2017, we had $117,500,000 outstanding under our revolving facility and approximately $166,250,000 outstanding under the TLA. See discussion of the maximum leverage ratio under “Debt Covenants” below. The revolving facility matures on June 23, 2021.

Our accounts receivable securitization financing facility (“ABS facility”) has a maximum aggregate borrowing availability of $250,000,000 and matures on June 23, 2019. Under our ABS facility, we can sell receivables periodically to a special purpose accounts receivable and financing entity (the “SPE”), which is exclusively engaged in purchasing receivables from us. The SPE is a wholly-owned, bankruptcy-remote entity that we have included in our consolidated financial statements. The SPE funds its purchases by selling undivided interests in eligible trade accounts receivable to independent financial institution purchasers under the ABS facility (“Purchasers”), which is administered by an independent financial institution agent. The SPE’s assets are available first and foremost to satisfy the claims of the Purchasers, and we cannot convey any interest in the receivables sold to the Purchasers (or allow any adverse claims on the receivables) without the consent of the Purchasers. In addition, the SPE is required to maintain a minimum capital amount and various reserves pursuant to the terms of the ABS facility. We maintain effective control over the receivables that are sold. Accordingly, the receivables remain recorded on our consolidated balance sheets. At December 31, 2017 and 2016, the SPE owned $1,141,520,000 and $936,467,000, respectively, of receivables recorded at fair value and included in the accompanying consolidated balance sheets. While the ABS facility has a stated maximum amount, the actual availability under the ABS facility is limited by the quantity and quality of the underlying accounts receivable. As of December 31, 2017, qualified receivables were sufficient to permit access to the full $250,000,000 facility amount, of which $25,000,000 was outstanding. See discussion of the maximum leverage ratio under “Debt Covenants” below.

Under the amended ABS facility, interest is payable monthly, and the floating interest rate applicable at December 31, 2017 was 2.41% per annum, including a 0.85% usage fee on any outstanding balances. In addition, we pay a monthly commitment fee on the unused portion of the facility of 0.375%. During the years ended December 31, 2017, 2016 and 2015, the weighted average interest rates on amounts outstanding under our ABS facility, including the usage and commitment fees and the amortization of deferred financing fees, were 2.4%, 1.9% and 1.6%, respectively. Weighted average borrowings under our ABS facility in 2017, 2016 and 2015 were $153,759,000, $145,376,000 and $112,101,000, respectively.

Debt Covenants

Our revolving facility, our TLA and our ABS facility contain various covenants customary for transactions of this type, including limitations on the payment of dividends and the requirement that we comply with maximum leverage and minimum fixed charge ratio requirements, comply with a minimum receivables requirement and meet monthly, quarterly and annual reporting requirements. If we fail to comply with these covenants, the lenders would be able to demand payment within a specified period of time. Further, the terms of the ABS facility identify various circumstances that would result in an “amortization event” under the facility.

Our consolidated debt balance that can be outstanding at the end of any fiscal quarter under our revolving facility, our TLA and our ABS facility is limited by certain financial covenants, particularly a maximum leverage ratio. The maximum leverage ratio is calculated as aggregate debt outstanding divided by the sum of our trailing twelve month net earnings (loss) plus (i) interest expense, excluding non-cash imputed interest on our inventory financing facility, (ii) income tax expense (benefit), (iii) depreciation and amortization, (iv) non-cash stock-based compensation, (v) extraordinary or non-recurring non-cash losses or expenses and (vi) certain cash restructuring and acquisition-related charges and synergies, not to exceed a specified cap (“adjusted earnings”). The maximum leverage ratio permitted under the facilities was increased to 3.50 times trailing twelve-month adjusted earnings in conjunction with the acquisition of Datalink effective January 6, 2017. A significant drop in our adjusted earnings would limit the amount of indebtedness that could be outstanding at the end of any fiscal quarter to a level that would be below our consolidated maximum facility amount. Based on our maximum leverage ratio as of December 31, 2017, our aggregate debt balance that could have been outstanding under our revolving facility, our TLA and our ABS facility was the full amount of the maximum borrowing capacity of $766,250,000, of which $117,500,000 was outstanding under our revolving facility, $166,250,000 was outstanding under our TLA and $25,000,000 was outstanding under our ABS facility at December 31, 2017.

Capital Lease and Other Financing Obligations

In August 2017, we entered into two 12-month capital leases for certain IT equipment. In May 2017 and March 2016, we entered into capitalized leases with 36-month terms for certain IT equipment. The capital leases were non-cash transactions and, accordingly, have been excluded from our consolidated statements of cash flows for the years ended December 31, 2017 and 2016.

Future minimum payments under the capitalized leases consist of the following as of December 31, 2017 (in thousands):

Years Ending December 31,
2018	$	1,550
2019		1,016
2020		381
Total minimum lease payments		2,947
Less amount representing interest		(145	)
Present value of minimum lease payments	$	2,802

From time to time, we also enter into other financing agreements with financial intermediaries to facilitate the purchase of products from certain vendors. In conjunction with our acquisition of Datalink effective January 6, 2017, we acquired certain obligations associated with Datalink’s financing of the equipment that it leased to its clients. At December 31, 2017, these financing obligations totaled $2,489,000. No amounts were owed under other financing agreements as of December 31, 2016.

The current and long-term portions of our capital lease and other financing obligations are included in the current and long-term portions of long-term debt in the table above and in our consolidated balance sheets as of December 31, 2017 and 2016.

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Operating Leases

12 Months Ended

Dec. 31, 2017

Leases [Abstract]

Operating Leases

(7) Operating Leases

We have non-cancelable operating leases with third parties, primarily for administrative and distribution center space and computer equipment. Our facilities leases generally provide for periodic rent increases and many contain escalation clauses and renewal options. We recognize rent expense on a straight-line basis over the lease term. Rental expense for these third-party operating leases was $19,126,000, $14,444,000 and $14,737,000 in 2017, 2016 and 2015, respectively, and is included in selling and administrative expenses in the accompanying consolidated statements of operations.

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2017 are as follows (in thousands):

Years Ending December 31,
2018		18,601
2019		16,617
2020		12,122
2021		9,170
2022		6,966
Thereafter		12,023
Total minimum lease payments	$	75,499

Amounts in the table above exclude approximately $1.6 million in each of 2018 and 2019 in non-cancellable rental income.

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Severance and Restructuring Activities

12 Months Ended

Feb. 21, 2018

Restructuring and Related Activities [Abstract]

Severance and Restructuring Activities

(8) Severance and Restructuring Activities

During 2017, 2016 and 2015, we recorded severance expense associated with the elimination of certain positions based on a re-alignment of roles and responsibilities and a continued review of resource needs. Charges in North America included severance actions taken to realign roles and responsibilities subsequent to the acquisition of Datalink in January 2017, as well as a headcount reduction as part of cost reduction initiatives in the fourth quarter of 2017 and early in 2016. Charges in EMEA included ongoing restructuring activities, primarily in France, Germany, the United Kingdom and the Netherlands, as part our cost reduction and restructuring initiatives in the region. The APAC charges primarily related to severance actions taken subsequent to the acquisition of Ignia. The following table details the activity for each of the three years in the period ending December 31, 2017 related to these resource actions, and the outstanding obligations as of December 31, 2017 (in thousands):

	North America			EMEA			APAC			Consolidated
Balances at December 31, 2014	$	857		$	2,971		$	—		$	3,828
Severance costs, net of adjustments		1,126			3,781			—			4,907
Cash payments		(1,456	)		(3,534	)		—			(4,990	)
Foreign currency translation adjustments		(22	)		(235	)		—			(257	)
Balances at December 31, 2015		505			2,983			—			3,488
Severance costs, net of adjustments		2,966			1,496			118			4,580
Cash payments		(2,524	)		(3,239	)		(118	)		(5,881	)
Foreign currency translation adjustments		—			(23	)		—			(23	)
Balances at December 31, 2016		947			1,217			—			2,164
Severance costs, net of adjustments		4,010			4,888			104			9,002
Cash payments		(3,336	)		(3,597	)		(89	)		(7,022	)
Foreign currency translation adjustments		10			486			—			496
Balances at December 31, 2017	$	1,631		$	2,994		$	15		$	4,640

Immaterial adjustments were recorded as a reduction to severance and restructuring expense in each of 2017, 2016 and 2015, due to changes in estimates.

The remaining outstanding obligations as of December 31, 2017 are expected to be paid during the next 12 months and are therefore included in accrued expenses and other current liabilities.

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Stock-Based Compensation

12 Months Ended

Feb. 21, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

(9) Stock-Based Compensation

We recorded the following pre-tax amounts in selling and administrative expenses for stock-based compensation, by operating segment, in the accompanying consolidated financial statements (in thousands):

	Years Ended December 31,
	2017		2016		2015
North America	$	9,697	$	8,096	$	6,648
EMEA		2,737		2,530		1,908
APAC		392		432		366
Total Consolidated	$	12,826	$	11,058	$	8,922

Company Plan

Our Board of Directors adopted the Amended Insight Enterprises, Inc. 2007 Omnibus Plan (the “Plan”) on March 28, 2011. The Plan was approved by our stockholders on May 18, 2011 at our 2011 annual meeting and, unless sooner terminated, will remain in place until May 18, 2021.                

The Plan allows the Company to grant options, stock appreciation rights, stock awards, restricted stock, stock units (which may also be referred to as “restricted stock units”), performance shares, performance units, cash-based awards and other awards payable in cash or shares of common stock to eligible non-employee directors, employees and consultants. Consultants and independent contractors are eligible if they provide bona fide services that are not related to capital raising or promoting or maintaining a market for the Company’s stock.

On February 17, 2016, the Board of Directors adopted the First Amendment to the Plan (the “First Amendment”). On May 18, 2016 at our 2016 annual meeting, our stockholders approved the First Amendment. The First Amendment: (a) updates the list of performance criteria contained in Section 16.1 of the Plan; (b) imposes a limit on the dollar value of awards that may be granted to any one participant who is a non-employee director during any one calendar year; and (c) adds an objective clawback provision expressly providing that every award granted under the Plan is subject to potential forfeiture or recovery to the fullest extent called for by law, listing standard or Company policy. The First Amendment did not increase the number of shares available for grant under the Plan or extend the term of the Plan.

The Plan is administered by the Compensation Committee of Insight’s Board of Directors, and, except as provided below, the Compensation Committee has the exclusive authority to administer the Plan, including the power to determine eligibility, the types of awards to be granted, the price and the timing of awards. Under the Plan, the Compensation Committee may delegate some of its authority to our Chief Executive Officer to grant awards to individuals other than individuals who are subject to the reporting requirements of Section 16(a) of the Securities Exchange Act of 1934, as amended. As of December 31, 2017, of the 7,250,000 shares of common stock reserved and available for grant under the Plan, 3,215,540 shares of common stock remain available for grant under the Plan.

Accounting for Restricted Stock Units

We issue RSUs as incentives to certain officers and teammates and as compensation to members of our Board of Directors. We recognize compensation expense associated with the issuance of such RSUs over the vesting period for each respective RSU. The total compensation expense associated with RSUs represents the value based upon the number of RSUs awarded multiplied by the closing price of our common stock on the date of grant. The number of RSUs to be awarded under our service-based RSUs is fixed at the grant date. The number of RSUs ultimately awarded under our performance-based RSUs varies based on whether the Company achieves certain financial results. We record compensation expense each period based on our estimate of the most probable number of RSUs that will be issued under the grants of performance-based RSUs. Recipients of RSUs do not have voting or dividend rights until the vesting conditions are satisfied and shares are released.

As of December 31, 2017, total compensation cost related to nonvested RSUs not yet recognized is $17,483,000, which is expected to be recognized over the next 1.25 years on a weighted-average basis.

The following table summarizes our RSU activity during 2017:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at the beginning of year		1,067,557		$	25.37
Granted		369,438		$	44.12
Vested, including shares withheld to cover taxes		(466,839	)	$	24.88	$	20,284,762	(a)
Forfeited		(78,043	)	$	32.16
Nonvested at the end of year		892,113		$	32.86	$	34,159,007	(b)

^(a) The aggregate fair value of vested RSUs represents the total pre-tax fair value, based on the closing stock price on the day of vesting, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date. The aggregate intrinsic value for RSUs which vested during 2016 and 2015 was $9,235,102 and $9,168,784, respectively.

^(b) The aggregate fair value of the nonvested RSUs and the RSUs expected to vest represents the total pre-tax fair value, based on our closing stock price of $38.29 as of December 29, 2017 (December 31, 2017 was not a trading day), which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.

During each of the years in the three-year period ended December 31, 2017, the RSUs that vested for teammates in the United States were net-share settled such that we withheld shares with value equivalent to the teammates’ minimum statutory United States tax obligation for the applicable income and other employment taxes and remitted the equivalent cash amount to the appropriate taxing authorities. The total shares withheld during 2017, 2016 and 2015 of 122,255, 84,953 and 85,652, respectively, were based on the value of the RSUs on their vesting dates as determined by our closing stock price on such dates. For 2017, 2016 and 2015, total payments for our teammates’ tax obligations to the taxing authorities were $5,318,000, $2,219,000 and $2,265,000, respectively, and are reflected as a financing activity within the accompanying consolidated statements of cash flows. These net-share settlements had the effect of repurchases of our common stock as they reduced the number of shares that would have otherwise been issued as a result of the vesting and did not represent an expense to us.

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Assets Held for Sale

12 Months Ended

Dec. 31, 2017

Disposal Group, Held-for-sale, Not Discontinued Operations [Member]

Assets Held for Sale

(10) Assets Held for Sale

In May 2016, we sold real estate that we owned in Bloomingdale, Illinois that was previously classified as a held for sale asset and included in other current assets in the accompanying consolidated balance sheet as of December 31, 2015. In previous years, we recorded non-cash charges to reduce the carrying amount of the related assets to their estimated fair value less costs to sell. During the second quarter of 2016, we recorded a gain on sale of approximately $338,000, which is included in selling and administrative expenses in the accompanying consolidated statement of operations for the year ended December 31, 2016.

Discontinued Operations, Disposed of by Sale [Member] | Russia [Member]

Assets Held for Sale

(22) Sale of Foreign Entity

On July 19, 2017, we concluded the sale of our operations in Russia, formerly a part of our EMEA operating segment, to one of our global partners that is focused in the region. We recorded a loss on the sale of the foreign entity of approximately $3,646,000 during the third quarter of 2017, including a $2,903,000 charge upon the release of our cumulative translation adjustment account balance as of the sale date.

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Income Taxes

12 Months Ended

Feb. 21, 2018

Income Tax Disclosure [Abstract]

Income Taxes

(11) Income Taxes

The following table presents the United States (“U.S.”) and foreign components of earnings before income taxes and the related income tax expense (in thousands):

Earnings before income taxes:

	Years Ended December 31,
	2017		2016		2015
United States	$	119,330	$	99,095	$	90,575
Foreign		39,768		40,363		28,601
	$	159,098	$	139,458	$	119,176

Income tax expense:

	Years Ended December 31,
	2017			2016			2015
Current:
U.S. Federal	$	31,067		$	27,947		$	24,369
U.S. State and local		3,636			2,200			2,705
Foreign		14,573			14,104			11,077
		49,276			44,251			38,151
Deferred:
U.S. Federal		20,327			10,395			5,104
U.S. State and local		(427	)		1,088			602
Foreign		(761	)		(966	)		(532	)
		19,139			10,517			5,174
	$	68,415		$	54,768		$	43,325

The following schedule reconciles the differences between the U.S. federal income taxes at the U.S. statutory rate and our income tax expense (dollars in thousands):

	2017					2016					2015
Statutory federal income tax rate	$	55,684		35.0	%	$	48,810		35.0	%	$	41,712		35.0	%
State income tax expense, net of federal income tax benefit		2,808		1.8			3,368		2.4			3,180		2.7
Audits and adjustments, net		(313	)	(0.2	)		(1,039	)	(0.7	)		(886	)	(0.7	)
Change in valuation allowances		2,472		1.5			3,742		2.7			2,944		2.5
Foreign income taxed at different rates		(6,057	)	(3.8	)		(6,611	)	(4.7	)		(5,729	)	(4.8	)
U.S. mandatory deemed repatriation		5,625		3.5			—		—			—		—
Adjustment of net deferred tax assets for enacted U.S. federal tax reform		7,738		4.9			—		—			—		—
Change in U.S. tax law applicable to certain foreign entities		—		—			2,577		1.8			—		—
Non-deductible compensation		571		0.4			518		0.4			474		0.4
Other, net		(113	)	(0.1	)		3,403		2.4			1,630		1.3
Effective tax rate	$	68,415		43.0	%	$	54,768		39.3	%	$	43,325		36.4	%

In December 2017, U.S. federal tax reform was enacted as part of the U.S. Tax Cuts and Jobs Act. As part of the change in tax law, beginning in 2018, the U.S. statutory federal income tax rate was reduced from 35% to 21%. This reduction required a remeasurement of our deferred tax balances that resulted in an increase in our 2017 income tax expense. In addition, the change in tax law included provisions requiring mandatory deemed repatriation of undistributed foreign earnings. In 2017, we recorded a tax charge totaling $13,363,000 in connection with the enactment of the U.S. Tax Cuts and Jobs Act. Due to the enactment date and complexities of the new law, we have not completed our accounting related to these items. In accordance with Staff Accounting Bulletin 118, issued on December 22, 2017, we have concluded that the U.S. income taxes attributable to the remeasurement of U.S. deferred income taxes, the mandatory deemed repatriation provision and the state tax effects of these items are provisional amounts.

A change in U.S. tax law was enacted in December 2016 related to the taxation of foreign currency translation gains or losses arising from qualified business units. The change, which increased our U.S. federal income taxes, affects our foreign entities that are treated as branches for U.S. tax purposes. The “Other, net” line item in the schedule above includes $349,000 and $1,296,000 related to the effect of non-deductible acquisition-related expenses incurred during 2017 and 2016, respectively.

For foreign entities not treated as branches for U.S. tax purposes, historically, we did not provide for U.S. income taxes on the undistributed earnings of these subsidiaries as these earnings were considered to be reinvested and, in the opinion of management, would continue to be reinvested indefinitely outside of the United States. As a result of U.S. federal tax reform enacted during December 2017, all undistributed foreign earnings are deemed distributed.

The significant components of deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2017			2016
Deferred tax assets:
Net operating losses	$	25,418		$	18,964
Foreign tax credits		21,346			13,115
Accruals		5,921			6,426
Goodwill and other intangibles		4,717			35,523
Stock-based compensation		3,023			4,238
Accounts receivable		2,124			2,547
Inventories		1,930			2,598
Property and equipment		1,111			705
Deferred revenue		600			468
Other		335			55
Gross deferred tax assets		66,525			84,639
Valuation allowances		(45,995	)		(30,972	)
Total deferred tax assets		20,530			53,667
Deferred tax liabilities:
Goodwill and other intangibles		(1,587	)		(1,221	)
Accrued withholding tax		(1,452	)		—
Prepaid expenses		(369	)		(204	)
Other		(775	)		(795	)
Total deferred tax liabilities		(4,183	)		(2,220	)
Net deferred tax assets	$	16,347		$	51,447

The net non-current deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2017			2016
Net non-current deferred tax assets	$	17,064		$	52,347
Net non-current deferred tax liabilities		(717	)		(900	)
Net deferred tax assets	$	16,347		$	51,447

As of December 31, 2017, we have a federal net operating loss carryforward (“NOL”) of $1,455,000 and U.S. state NOLs of $1,977,000 that will expire between 2018 and 2036. We also have NOLs from various non-U.S. jurisdictions of $87,056,000. While the majority of the non-U.S. NOLs have no expiration date, $6,258,000 will expire between 2018 and 2024.

On the basis of currently available information, we have provided valuation allowances for certain of our deferred tax assets where we believe it is more likely than not that the related tax benefits will not be realized. At December 31, 2017 and 2016, our valuation allowances totaled $45,995,000 and $30,972,000, respectively, representing non-U.S. NOLs, foreign depreciation allowances and foreign tax credits.

We believe it is more likely than not that forecasted income, including income that may be generated as a result of prudent and feasible tax planning strategies, together with the tax effects of deferred tax liabilities, will be sufficient to fully recover our remaining deferred tax assets. In the future, if we determine that realization of the remaining deferred tax assets and the availability of certain previously paid taxes to be refunded are not more likely than not, we will need to increase our valuation allowances and record additional income tax expense.

The following table summarizes the change in the valuation allowance (in thousands):

	December 31,
	2017			2016
Valuation allowances at beginning of year	$	30,972		$	28,750
Increase in income tax expense		2,472			3,742
U.S. federal tax reform		11,623			—
Foreign currency translation adjustments		2,865			(1,035	)
Other		(1,937	)		(485	)
Valuation allowances at end of year	$	45,995		$	30,972

The increase in our valuation allowance related to U.S. federal tax reform in the table above was primarily related to U.S. mandatory deemed repatriation.

Various taxing jurisdictions are examining our tax returns for certain tax years. Although the outcome of tax audits cannot be predicted with certainty, management believes the ultimate resolution of these examinations will not result in a material adverse effect to our financial position, results of operations or cash flows.

As of December 31, 2017 and 2016, we had approximately $4,273,000 and $2,246,000, respectively, of unrecognized tax benefits. Of these amounts, approximately $287,000 and $195,000, respectively, related to accrued interest. A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest, is as follows (in thousands):

Balance at December 31, 2016	$	2,051
Additions for tax positions added through acquisition		2,484
Subtractions for tax positions in prior periods		(59	)
Additions for tax positions in current period		867
Additions due to foreign currency translation		53
Subtractions due to audit settlements and statute expirations		(1,410	)
Balance at December 31, 2017	$	3,986

In the future, if recognized, the liability associated with uncertain tax positions would affect our effective tax rate. We do not believe there will be any changes over the next 12 months that would have a material effect on our effective tax rate.

Several of our subsidiaries are currently under audit for tax years 2012 through 2015. Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months which could significantly increase or decrease the balance of our gross unrecognized tax benefits. However, based on the status of the various examinations in multiple jurisdictions, an estimate of the range of reasonably possible outcomes cannot be made at this time, but the estimated effect on our income tax expense and net earnings is not expected to be significant.

We, including our subsidiaries, file income tax returns in the U.S. federal jurisdiction and many state and local and non-U.S. jurisdictions. In the United States, federal income tax returns for 2014, 2015, 2016 and 2017 remain open to examination. For U.S. state and local taxes as well as in non-U.S. jurisdictions, the statute of limitations generally varies between three and ten years.

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Market Risk Management

12 Months Ended

Dec. 31, 2017

Text Block [Abstract]

Market Risk Management

(12) Market Risk Management

Interest Rate Risk

We have interest rate exposure arising from our financing facilities, which have variable interest rates. These variable interest rates are affected by changes in short-term interest rates. We currently do not hedge our interest rate exposure.

We do not believe that the effect of reasonably possible near-term changes in interest rates will be material to our financial position, results of operations and cash flows. Our financing facilities expose our net earnings to changes in short-term interest rates since interest rates on the underlying obligations are variable. We had $117,500,000 outstanding under our revolving facility, $166,250,000 outstanding under our TLA and $25,000,000 outstanding under our ABS facility at December 31, 2017. The interest rate attributable to the borrowings under our revolving facility, our TLA and our ABS facility was 3.49%, 3.57% and 2.41%, respectively, per annum at December 31, 2017. The change in annual pre-tax earnings from operations resulting from a hypothetical 10% increase or decrease in the applicable interest rate would have been immaterial.

Foreign Currency Exchange Risk

We have foreign currency exchange risk related to the translation of our foreign subsidiaries’ operating results, assets and liabilities (see Note 1 for a description of our Foreign Currencies policy). We also maintain cash accounts denominated in currencies other than the functional currency, which expose us to fluctuations in foreign exchange rates. Remeasurement of these cash balances results in gains/losses that are also reported as a separate component of non-operating (income) expense. We monitor our foreign currency exposure and selectively enter into forward exchange contracts to mitigate risk associated with certain non-functional currency monetary assets and liabilities related to foreign denominated payables, receivables and cash balances. Transaction gains and losses resulting from non-functional currency assets and liabilities are offset by gains and losses on forward contracts in non-operating (income) expense, net in our consolidated statements of operations. The counterparties associated with our foreign exchange forward contracts are large creditworthy commercial banks. The derivatives transacted with these institutions are short in duration and, therefore, we do not consider counterparty concentration and non-performance to be material risks. The Company does not have a significant concentration of credit risk with any single counterparty.

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Derivative Financial Instruments

12 Months Ended

Dec. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

(13) Derivative Financial Instruments

We use derivatives to partially offset our exposure to fluctuations in certain foreign currencies. We do not enter into derivative contracts for speculative or trading purposes. Derivatives are recorded at fair value on the balance sheet based on observable market based inputs or unobservable inputs that are corroborated by market data (Level 2). Gains or losses resulting from changes in fair value of the derivative are recorded currently in income. We do not designate our hedges for hedge accounting, and our foreign currency derivative instruments are not subject to any master netting arrangements with our counterparties.

We use foreign exchange forward contracts to mitigate risk associated with certain non-functional currency assets and liabilities from fluctuations in foreign currency exchange rates. Our non-functional currency assets and liabilities are primarily related to foreign currency denominated payables, receivables, and cash balances. The foreign currency forward contracts, carried at fair value, typically have a maturity of one month or less. We currently enter into approximately four foreign exchange forward contracts per month with an average notional value of $10,610,000 and an average maturity of approximately nine days.

Our derivative financial instruments as of December 31, 2017 were not material. The effect of our derivative financial instruments on our results of operations during the years ended December 31, 2017, 2016 and 2015 were a gain of $159,000, a loss of $2,722,000 and a loss of $942,000, respectively. These amounts are reported within the net foreign currency exchange (gain) loss line item in our consolidated statements of operations.

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Fair Value Measurements

12 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value Measurements

(14) Fair Value Measurements

Fair value measurements are determined based on the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

We have elected to use the income approach to value our foreign exchange derivatives, using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present value amount assuming that participants are motivated, but not compelled, to transact. Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability (specifically LIBOR rates, foreign exchange rates, and foreign exchange forward points). Mid-market pricing is used as a practical expedient for fair value measurements. Fair value measurement of an asset or liability must reflect the nonperformance risk of the entity and the counterparty. Therefore, the impact of the counterparty’s creditworthiness when in an asset position and the Company’s creditworthiness when in a liability position has also been factored into the fair value measurement of the derivative instruments and did not have a material impact on the fair value of these derivative instruments. Both the counterparty and the Company are expected to continue to perform under the contractual terms of the instruments.

As of December 31, 2017, we have no non-financial assets or liabilities that are measured and recorded at fair value on a recurring basis, and our other financial assets or liabilities generally consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities and long-term debt. The estimated fair values of our cash and cash equivalents approximate their carrying values and are determined based on quoted prices in active markets for identical assets (Level 1). The estimated fair values of our long-term debt balances approximate their carrying values based on their variable interest rate terms that are based on current market interest rates for similar debt instruments. The fair values of the other financial assets and liabilities are based on the values that would be received or paid in an orderly transaction between market participants and approximate their carrying values due to their nature and short duration.

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Benefit Plans

12 Months Ended

Dec. 31, 2017

Retirement Benefits [Abstract]

Benefit Plans

(15) Benefit Plans

We adopted a defined contribution benefit plan (the “Defined Contribution Plan”) for our U.S. teammates which complies with section 401(k) of the Internal Revenue Code. The Company provides a discretionary match to all participants who make 401(k) contributions pursuant to the Defined Contribution Plan. The discretionary match provided to participants is equivalent to 50% of a participant’s pre-tax contributions up to a maximum of 6% of eligible compensation per pay period. Additionally, we offer several defined contribution benefit plans to our teammates outside of the United States. These plans and their related terms vary by country. Total consolidated contribution expense under these plans was $14,083,000, $7,684,000 and $7,190,000 for 2017, 2016 and 2015, respectively.

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Share Repurchase Programs

12 Months Ended

Dec. 31, 2017

Equity [Abstract]

Share Repurchase Programs

(16) Share Repurchase Programs

In February 2016, February 2015 and October 2014, our Board of Directors authorized share repurchase programs of $50,000,000, $75,000,000 and $25,000,000, respectively. No share repurchase program was authorized in 2017. The following table summarizes the shares of our common stock that we repurchased on the open market under these repurchase programs during the years ended December 31, 2017, 2016 and 2015, respectively, in thousands, except per share amounts:

Year	Total Number of Shares Purchased		Average Price Paid per Share		Approximate Dollar Value of Shares Purchased
2017		—	$	—	$	—
2016		1,891		26.43		50,000
2015		3,300		27.83		91,843
Total		5,191			$	141,843

All shares repurchased were retired.

On February 13, 2018, our Board of Directors authorized the repurchase of up to $50,000,000 of our common stock. Our share repurchases will be made on the open market, subject to Rule 10b-18 or in privately negotiated transactions, through block trades, through 10b5-1 plans or otherwise, at management’s discretion. The amount of shares purchased and the timing of the purchases will be based on market conditions, working capital requirements, general business conditions and other factors. We intend to retire the repurchased shares.

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Commitments and Contingencies

12 Months Ended

Feb. 21, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

(17) Commitments and Contingencies

Contractual

In the ordinary course of business, we issue performance bonds to secure our performance under certain contracts or state tax requirements. As of December 31, 2017, we had approximately $1,962,000 of performance bonds outstanding. These bonds are issued on our behalf by a surety company on an unsecured basis; however, if the surety company is ever required to pay out under the bonds, we have contractually agreed to reimburse the surety company.

Management believes that payments, if any, related to these performance bonds are not probable at December 31, 2017. Accordingly, we have not accrued any liabilities related to such performance bonds in our consolidated financial statements.

Employment Contracts and Severance Plans

We have employment contracts with, and plans covering, certain officers and management teammates under which severance payments would become payable in the event of specified terminations without cause or terminations under certain circumstances after a change in control. In addition, vesting of outstanding nonvested RSUs would accelerate following a change in control. If severance payments under the current employment agreements or plan payments were to become payable, the severance payments would generally range from three to twenty-four months of salary.

Indemnifications

From time to time, in the ordinary course of business, we enter into contractual arrangements under which we agree to indemnify either our clients or third-party service providers from certain losses incurred relating to services performed on our behalf or for losses arising from defined events, which may include litigation or claims relating to past performance. These arrangements include, but are not limited to, the indemnification of our clients for certain claims arising out of our performance under our sales contracts, the indemnification of our landlords for certain claims arising from our use of leased facilities and the indemnification of the lenders that provide our credit facilities for certain claims arising from their extension of credit to us. Such indemnification obligations may not be subject to maximum loss clauses.

Management believes that payments, if any, related to these indemnifications are not probable at December 31, 2017. Accordingly, we have not accrued any liabilities related to such indemnifications in the accompanying consolidated financial statements.

We have entered into separate indemnification agreements with certain of our executive officers and with each of our directors. These agreements require us, among other requirements, to indemnify such officers and directors against expenses (including attorneys’ fees), judgments and settlements incurred by such individual in connection with any action arising out of such individual’s status or service as our executive officer or director (subject to exceptions such as where the individual failed to act in good faith or in a manner the individual reasonably believed to be in, or not opposed to, the best interests of the Company) and to advance expenses incurred by such individual with respect to which such individual may be entitled to indemnification by us. There are no pending legal proceedings that involve the indemnification of any of the Company’s directors or officers.

Contingencies Related to Third-Party Review

From time to time, we are subject to potential claims and assessments from third parties. We are also subject to various governmental, client and partner audits. We continually assess whether or not such claims have merit and warrant accrual. Where appropriate, we accrue estimates of anticipated liabilities in our consolidated financial statements. Such estimates are subject to change and may affect our results of operations and our cash flows.

Legal Proceedings

From time to time, we are party to various legal proceedings arising in the ordinary course of business, including preference payment claims asserted in client bankruptcy proceedings, indemnification claims, claims of alleged infringement of patents, trademarks, copyrights and other intellectual property rights, claims of alleged non-compliance with contract provisions and claims related to alleged violations of laws and regulations. We regularly evaluate the status of the legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss, or an additional loss, may have been incurred and determine if accruals are appropriate. If accruals are not appropriate, we further evaluate each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made for disclosure. Although litigation is inherently unpredictable, we believe that we have adequate provisions for any probable and estimable losses. It is possible, nevertheless, that our consolidated financial position, results of operations or liquidity could be materially and adversely affected in any particular period by the resolution of a legal proceeding. Legal expenses related to defense, negotiations, settlements, rulings and advice of outside legal counsel are expensed as incurred.

The Company is not involved in any pending or threatened legal proceedings that it believes would reasonably be expected to have a material adverse effect on its business, financial condition or results of operations.

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Supplemental Financial Information

12 Months Ended

Feb. 21, 2018

Receivables [Abstract]

Supplemental Financial Information

(18) Supplemental Financial Information

Additions and deductions related to the allowance for doubtful accounts receivable for 2017, 2016 and 2015 were as follows (in thousands):

	Balance at Beginning of Year		Additions		Deductions			Balance at End of Year
Allowance for doubtful accounts receivable:
Year ended December 31, 2017	$	9,138	$	5,245	$	(4,225	)	$	10,158
Year ended December 31, 2016	$	11,872	$	2,452	$	(5,186	)	$	9,138
Year ended December 31, 2015	$	19,336	$	6,761	$	(14,225	)	$	11,872

During 2015, we undertook a project to analyze our older accounts receivable to attempt further collection action, or where appropriate, to write off such accounts as uncollectible. Since these aged accounts receivable had been fully reserved against, the write off was accomplished through the elimination of the associated allowance, with no effect on net accounts receivable balances. The reduction of the allowance for doubtful accounts to $11,872,000 at December 31, 2015 was a direct result of the write off of these older fully reserved accounts receivable as well as an overall improvement in managing the receivables portfolio. The reduction of the reserve during 2015 related to these actions had no effect on our results of operations.

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Cash Flows

12 Months Ended

Feb. 21, 2018

Supplemental Cash Flow Elements [Abstract]

Cash Flows

(19) Cash Flows

Cash payments for interest on indebtedness and cash payments for taxes on income were as follows (in thousands):

	Years Ended December 31,
	2017		2016		2015
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$	10,976	$	3,782	$	2,866
Cash paid during the year for income taxes, net of refunds	$	55,470	$	39,051	$	41,062

Non-cash investing activities for 2017, 2016 and 2015 included $159,000, $791,000 and $662,000, respectively, of capital expenditures in accounts payable, representing additions purchased at period end but not yet paid for in cash.

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Segment and Geographic Information

12 Months Ended

Feb. 21, 2018

Segment Reporting [Abstract]

Segment and Geographic Information

(20) Segment and Geographic Information

We operate in three reportable geographic operating segments: North America; EMEA; and APAC. Our offerings in North America and certain countries in EMEA and APAC include IT hardware, software and services. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services.

During the year ended December 31, 2017, subsequent to our acquisition of Datalink, our consolidated net sales from the provision of services approximated 10%. As such, for the year ended December 31, 2017, we began reporting net sales from the provision of services and the related costs of goods sold separately from net sales of products and the related costs of goods on the face of our consolidated statement of operations. For comparability purposes, net sales and costs of goods sold for the years ended December 31, 2016 and 2015 have been expanded to conform to the current year presentation. These changes in presentation had no effect on previously reported total net sales, total costs of goods sold or gross profit amounts.

In conjunction with these changes in presentation, because fees earned from activities reported net are considered services revenues, we reclassified certain revenue streams for which we act as the agent in the transaction to net sales from services. Previously, we included these net revenue streams within our software and, to a lesser extent, hardware sales mix categories based on the type of product being sold (e.g., fees earned for the sale of software maintenance and certain software licenses were included in software sales and fees earned for the sale of certain third-party provided training and warranty services were included in hardware sales when we historically disclosed and analyzed our sales mix). For comparability purposes, our sales mix among our hardware, software and services categories for the years ended December 31, 2016 and 2015 has been reclassified to conform to the current year presentation. These reclassifications had no effect on previously reported total net sales amounts. The following tables summarize net sales by offering for North America, EMEA and APAC including the effect of the reclassifications on the previously reported net sales by sales mix amounts for the years ended December 31, 2016 and 2015 (in thousands):

	North America Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	3,352,355	$	2,454,889	$	2,336,764
Software		1,310,118		1,146,808		1,157,168
Services		519,261		370,131		329,596
	$	5,181,734	$	3,971,828	$	3,823,528

In North America, fees earned from activities reported on a net basis of $270,000 and $87,984,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $24,000 and $74,101,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

	EMEA Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	536,500	$	481,505	$	531,308
Software		710,452		762,427		756,373
Services		108,464		94,628		83,456
	$	1,355,416	$	1,338,560	$	1,371,137

In EMEA, fees earned from activities reported on a net basis of $48,586,000 and $43,388,000 that were previously reported as part of our software product category in 2016 and 2015, respectively, were reclassified to services to conform to the current year presentation.

	APAC Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	27,907	$	18,916	$	14,327
Software		101,412		132,718		149,607
Services		37,154		23,493		14,491
	$	166,473	$	175,127	$	178,425

In APAC, fees earned from activities reported on a net basis of $9,000 and $10,991,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $6,000 and $8,439,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

The method for determining what information regarding operating segments, products and services, geographic areas of operation and major clients to report is based upon the “management approach,” or the way that management organizes the operating segments within a company, for which separate financial information is evaluated regularly by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. Our CODM is our Chief Executive Officer.

All significant intercompany transactions are eliminated upon consolidation, and there are no differences between the accounting policies used to measure profit and loss for our segments or on a consolidated basis. Net sales are defined as net sales to external clients. None of our clients exceeded ten percent of consolidated net sales in 2017, 2016 or 2015.

A portion of our operating segments’ selling and administrative expenses arise from shared services and infrastructure that we have historically provided to them in order to realize economies of scale and to use resources efficiently. These expenses, collectively identified as corporate charges, include senior management expenses, internal audit, legal, tax, insurance services, treasury and other corporate infrastructure expenses. Charges are allocated to our operating segments, and the allocations have been determined on a basis that we considered to be a reasonable reflection of the utilization of services provided to or benefits received by the operating segments.

The tables below present information about our reportable operating segments (in thousands):

	Year Ended December 31, 2017
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	4,662,473	$	1,246,952	$	129,319	$	6,038,744
Services		519,261		108,464		37,154		664,879
Total net sales		5,181,734		1,355,416		166,473		6,703,623
Costs of goods sold:
Products		4,253,587		1,140,204		118,611		5,512,402
Services		236,470		24,902		11,279		272,651
Total costs of goods sold		4,490,057		1,165,106		129,890		5,785,053
Gross profit		691,677		190,310		36,583		918,570
Operating expenses:
Selling and administrative expenses		530,792		164,305		28,231		723,328
Severance and restructuring expenses		4,010		4,888		104		9,002
Loss on sale of foreign entity		—		3,646		—		3,646
Acquisition-related expenses		3,223		106		—		3,329
Earnings from operations	$	153,652	$	17,365	$	8,248	$	179,265
Total assets	$	2,337,573	$	530,242	$	101,169	$	2,968,984	*
	Year Ended December 31, 2016
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	3,601,697	$	1,243,932	$	151,634	$	4,997,263
Services		370,131		94,628		23,493		488,252
Total net sales		3,971,828		1,338,560		175,127		5,485,515
Costs of goods sold:
Products		3,301,148		1,129,917		140,397		4,571,462
Services		145,199		22,956		2,796		170,951
Total costs of goods sold		3,446,347		1,152,873		143,193		4,742,413
Gross profit		525,481		185,687		31,934		743,102
Operating expenses:
Selling and administrative expenses		401,316		160,269		23,658		585,243
Severance and restructuring expenses		2,966		1,496		118		4,580
Acquisition-related expenses		4,278		—		169		4,447
Earnings from operations	$	116,921	$	23,922	$	7,989	$	148,832
Total assets	$	2,204,351	$	562,293	$	119,778	$	2,886,422	*

	Year Ended December 31, 2015
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	3,493,932	$	1,287,681	$	163,934	$	4,945,547
Services		329,596		83,456		14,491		427,543
Total net sales		3,823,528		1,371,137		178,425		5,373,090
Costs of goods sold:
Products		3,196,297		1,167,113		149,943		4,513,353
Services		125,668		17,737		—		143,405
Total costs of goods sold		3,321,965		1,184,850		149,943		4,656,758
Gross profit		501,563		186,287		28,482		716,332
Operating expenses:
Selling and administrative expenses		396,603		165,879		22,424		584,906
Severance and restructuring expenses		1,126		3,781		—		4,907
Earnings from operations	$	103,834	$	16,627	$	6,058	$	126,519
Total assets	$	1,999,485	$	543,146	$	114,973	$	2,657,604	*

* Consolidated total assets do not reflect intercompany eliminations and corporate assets of $283,333,000, $667,122,000 and $643,587,000 at December 31, 2017, 2016 and 2015, respectively.

The following is a summary of our geographic net sales and long-lived assets, consisting of property and equipment, net (in thousands):

	United States		United Kingdom		Other Foreign		Total
2017
Net sales	$	4,933,805	$	684,632	$	1,085,186	$	6,703,623
Total long-lived assets	$	50,462	$	14,783	$	10,007	$	75,252
2016
Net sales	$	3,776,352	$	671,999	$	1,037,164	$	5,485,515
Total long-lived assets	$	46,774	$	13,570	$	10,566	$	70,910
2015
Net sales	$	3,645,876	$	711,957	$	1,015,257	$	5,373,090
Total long-lived assets	$	58,748	$	16,810	$	12,723	$	88,281

Net sales by geographic area are presented by attributing net sales to external customers based on the domicile of the selling location.

We recorded the following pre-tax amounts, by operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

	Years Ended December 31,
	2017		2016		2015
Depreciation and amortization of property and equipment:
North America	$	20,241	$	21,952	$	22,239
EMEA		5,025		4,908		3,757
APAC		521		633		653
		25,787		27,493		26,649
Amortization of intangible assets:
North America		15,971		8,139		8,053
EMEA		73		1,951		2,834
APAC		768		547		421
		16,812		10,637		11,308
Total	$	42,599	$	38,130	$	37,957

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Acquisitions

12 Months Ended

Feb. 21, 2018

Business Combinations [Abstract]

Acquisitions

(21) Acquisitions

Caase.com

Effective September 26, 2017, we acquired Caase.com, a Dutch cloud service provider, for a purchase price, net of cash acquired, of approximately $6,038,000, subject to a final working capital adjustment. We believe that this acquisition strengthened our ability to deliver Intelligent Technology Solutions to our clients in the Netherlands, with a view to expand into the wider European region in the near future.

The total fair value of net identifiable assets acquired was approximately $2,107,000, including $68,000 of cash acquired and $2,039,000 of identifiable intangible assets, consisting primarily of customer relationships. The customer relationships identifiable intangible asset is being amortized using the straight-line method over its estimated economic life of 8 years. The preliminary purchase price was allocated under the acquisition method of accounting using the information available at the time. During the fourth quarter of 2017, we finalized the fair value assumptions for identifiable intangible assets acquired and reduced the fair value of identifiable intangible assets acquired by approximately $193,000. Goodwill initially recorded of approximately $4,117,000, which was recorded in our EMEA operating segment, was adjusted to $4,041,000 as of December 31, 2017 as a result of the net effects of the decrease in the value of acquired identifiable intangible assets noted previously, adjustments for deferred taxes and foreign currency translation adjustments. None of the goodwill is tax deductible. We will finalize the purchase price allocation in 2018 when the final working capital adjustment is agreed upon and paid and the evaluation of uncertain tax positions, which could lead to an adjustment of the purchase price allocation, is completed.

We consolidated the results of operations for Caase.com within our EMEA operating segment beginning on the effective date of the acquisition. Our historical results would not have been materially affected by the acquisition of Caase.com and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our statements of operations.

Datalink

On January 6, 2017, we completed our acquisition of Datalink, a leading provider of IT services and enterprise data center solutions based in Eden Prairie, Minnesota, for a cash purchase price of $257,456,000, which included cash and cash equivalents acquired of $76,597,000. We believe that this acquisition strengthened our position as a leading IT solutions provider with deep technical talent delivering data center solutions to clients on premise or in the cloud.

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

Total purchase price				$	257,456
Fair value of net assets acquired:
Current assets	$	238,577
Identifiable intangible assets – see description below		94,500
Property and equipment		5,843
Other assets		17,888
Current liabilities		(129,071	)
Long-term liabilities, including deferred taxes		(34,421	)
Total fair value of net assets acquired					193,316
Excess purchase price over fair value of net assets acquired (“goodwill”)				$	64,140

Under the acquisition method of accounting, the total purchase price as shown in the table above was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase price over fair value of net assets acquired was recorded as goodwill.

The estimated fair values of current assets and liabilities (other than deferred revenue and related deferred costs) were based upon their historical costs on the date of acquisition due to their short-term nature. The majority of property and equipment were also estimated based upon historical costs as they approximated fair value. Certain long-term assets, including Datalink’s IT system, were written down to the estimated fair value based on the economic benefit expected to be realized from the assets following the acquisition. Deferred revenue acquired primarily represents monies collected prior to January 6, 2017 related to unearned revenues associated with support services to be performed in the future. The estimated fair value of deferred revenue of $65,500,000, which is included in current and long-term liabilities in the table above, was calculated using the adjusted fulfillment cost method as the present value of the costs expected to be incurred by a third party to perform the support services obligations acquired under various customer contracts, plus a reasonable profit associated with the performance effort. The deferred costs acquired represent monies paid prior to January 6, 2017 to purchase third party customer support contracts from manufacturers. The estimated fair value of the deferred costs of $48,029,000, which is included in current and other assets in the table above, was calculated in conjunction with the valuation of deferred revenue discussed above.

Identified intangible assets of $94,500,000 consist primarily of customer relationships, the trade name and non-compete agreements, which were valued at $92,200,000, $2,200,000 and $100,000, respectively. These values were determined using the multiple-period excess earnings method, the relief from royalty method and the lost income method, respectively.

The identifiable intangibles resulting from the acquisition are amortized using the straight-line method over the following estimated useful lives:

Intangible Assets	Estimated Economic Life
Customer relationships	10 Years
Trade name	1 Year
Non-compete agreements	1 Year

Amortization expense recognized for the period from the acquisition date through December 31, 2017 was $11,520,000.

Goodwill of $64,140,000, which was recorded in our North America operating segment, represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed from Datalink. The addition of the Datalink technical employees to our team and the opportunity to grow our data center solutions business are the primary factors making up the goodwill recognized as part of the transaction. None of the goodwill is tax deductible.

The preliminary purchase price was allocated using information available at the time. During the second quarter of 2017, upon analysis of additional information affecting our estimate of the fair value of net assets acquired, we adjusted the purchase price allocation and reduced the goodwill balance by $945,000. During the remainder of 2017, no further adjustments to the purchase price allocation were made, and the purchase price allocation was finalized.

We have consolidated the results of operations for Datalink since its acquisition on January 6, 2017. Consolidated net sales and gross profit for the year ended December 31, 2017 include $524,281,000 and $118,917,000, respectively, from Datalink. The following table reports pro forma information as if the acquisition of Datalink had been completed at the beginning of the earliest period presented (in thousands, except per share amounts):

		Year Ended December 31,
		2017		2016		2015
Net sales	As reported	$	6,703,623	$	5,485,515	$	5,373,090
	Proforma	$	6,707,533	$	6,084,484	$	6,033,750
Net earnings	As reported	$	90,683	$	84,690	$	75,851
	Proforma	$	92,276	$	85,823	$	75,696
Diluted earnings per share	As reported	$	2.50	$	2.32	$	1.98
	Proforma	$	2.55	$	2.36	$	1.98

Ignia

Effective September 1, 2016, we acquired Ignia, a business technology consulting and managed services provider headquartered in Perth, Australia, with an additional office in Melbourne, for a cash purchase price, net of cash acquired, of approximately $10,804,000, subject to a final working capital adjustment. We believe that this acquisition expands our global footprint in the areas of application design, digital solutions, cloud, mobility and business analytics, while also building on our unique position to bring solutions powered by Intelligent Technology™ to our clients in the Asia-Pacific region.

The total fair value of net identifiable assets acquired initially recorded was approximately $5,324,000, including $1,463,000 of cash acquired and $4,716,000 of identifiable intangible assets, consisting primarily of customer relationships and restrictive covenant agreements which are being amortized using the straight-line method over their estimated economic lives of eight years and 27 months, respectively. The preliminary purchase price was allocated using the information available at the time. During the fourth quarter of 2016, we finalized the fair value assumptions for identifiable intangible assets acquired and reduced the fair value of identifiable intangible assets acquired by approximately $218,000. Goodwill initially recorded of approximately $7,248,000, which was recorded in our APAC operating segment, was adjusted to $6,957,000 as of December 31, 2016 as a result of the net effects of the decrease in the value of acquired identifiable intangible assets noted previously and foreign currency translation adjustments. None of the goodwill is tax deductible. We finalized the purchase price allocation in the second quarter of 2017 when the final working capital adjustment of $35,000 was agreed upon.

We consolidated the results of operations for Ignia within our APAC operating segment beginning on September 1, 2016, the effective date of the acquisition. Our historical results would not have been materially affected by the acquisition of Ignia and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our statements of operations.

BlueMetal

Effective October 1, 2015, we acquired BlueMetal, an interactive design and technology architecture firm based in the Boston area, with offices in Chicago and New York, for a cash purchase price, net of cash acquired, of approximately $44,221,000. BlueMetal delivers strategic design, application development, business intelligence solutions and data visualization platforms, and we believe this acquisition strengthens our services capabilities to bring value to our clients’ businesses in the area of application design, mobility and big data.

The total fair value of net assets acquired was approximately $15,412,000, including $15,240,000 of identifiable intangible assets, consisting primarily of customer relationships and restrictive covenant agreements which are being amortized using the straight-line method over their estimated economic lives of eight and three years, respectively. Goodwill acquired approximated $29,938,000, which was recorded in our North America operating segment. In 2016, we resolved the working capital contingency associated with the acquisition of BlueMetal. We recorded an adjustment of the purchase price as a reduction of goodwill in our North America operating segment upon the receipt of $507,000 in cash during 2016. The addition of the BlueMetal employees to our team and the opportunity to grow our services business are the primary factors making up the goodwill recognized as part of the transaction. None of the goodwill is tax deductible.

We consolidated the results of operations for BlueMetal beginning on October 1, 2015, the effective date of the acquisition. Our historical results would not have been materially affected by the acquisition of BlueMetal and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our statements of operations.

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Selected Quarterly Financial Information

12 Months Ended

Feb. 21, 2018

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Information

(23) Selected Quarterly Financial Information (unaudited)

The following tables set forth selected unaudited consolidated quarterly financial information for 2017 and 2016 (in thousands, except per share data):

	Quarters Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
Net sales	$	1,784,075		$	1,757,973		$	1,684,032		$	1,477,543
Costs of goods sold		1,551,192			1,531,892			1,432,653			1,269,316
Gross profit		232,883			226,081			251,379			208,227
Operating expenses:
Selling and administrative expenses		184,554			180,390			180,752			177,632
Severance and restructuring expenses		2,791			494			1,022			4,695
Loss on sale of foreign entity		—			3,646			—			—
Acquisition-related expenses		—			106			276			2,947
Earnings from operations		45,538			41,445			69,329			22,953
Non-operating (income) expense:
Interest income		(346	)		(227	)		(205	)		(431	)
Interest expense		5,360			5,555			4,326			3,933
Net foreign currency exchange (gain) loss		(117	)		341			251			380
Other expense, net		367			339			326			315
Earnings before income taxes		40,274			35,437			64,631			18,756
Income tax expense		26,106			13,025			24,376			4,908
Net earnings	$	14,168		$	22,412		$	40,255		$	13,848
Net earnings per share:
Basic	$	0.40		$	0.63		$	1.13		$	0.39
Diluted	$	0.39		$	0.62		$	1.11		$	0.38
Shares used in per share calculations:
Basic		35,809			35,787			35,765			35,602
Diluted		36,272			36,203			36,169			36,185

	Quarters Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016
Net sales	$	1,467,583		$	1,392,716		$	1,456,234		$	1,168,982
Costs of goods sold		1,276,614			1,210,908			1,247,017			1,007,874
Gross profit		190,969			181,808			209,217			161,108
Operating expenses:
Selling and administrative expenses		145,066			143,872			150,186			146,119
Severance and restructuring expenses		1,527			788			909			1,356
Acquisition-related expenses		3,706			741			—			—
Earnings from operations		40,670			36,407			58,122			13,633
Non-operating (income) expense:
Interest income		(282	)		(318	)		(216	)		(250	)
Interest expense		2,271			2,517			1,992			1,848
Net foreign currency exchange (gain) loss		(520	)		579			(153	)		616
Other expense, net		311			352			359			268
Earnings before income taxes		38,890			33,277			56,140			11,151
Income tax expense		17,790			11,642			21,073			4,263
Net earnings	$	21,100		$	21,635		$	35,067		$	6,888
Net earnings per share:
Basic	$	0.59		$	0.61		$	0.96		$	0.19
Diluted	$	0.59		$	0.60		$	0.96		$	0.18
Shares used in per share calculations:
Basic		35,479			35,474			36,380			37,075
Diluted		35,963			35,790			36,612			37,386

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Operations and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business

Description of Business

We are a Fortune 500 global information technology (“IT”) provider helping businesses of all sizes – from small and medium sized firms to worldwide enterprises, governments, schools and health care organizations – define, architect, implement and manage Intelligent Technology Solutions^TM. We empower our clients to manage their IT environments so they can drive meaningful business outcomes today and transform their operations for tomorrow. Our company is organized in the following three operating segments, which are primarily defined by their related geographies:

Operating Segment	Geography
North America	United States and Canada
EMEA	Europe, Middle East and Africa
APAC	Asia-Pacific

Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services. Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services. A discussion of changes in our classification of certain revenue streams during 2017, can be found in Note 20. Prior year results were reclassified to conform to the current year presentation. These reclassifications had no effect on consolidated total net sales.

Acquisitions

Effective September 26, 2017, we acquired Caase Group B.V. (referred to herein as, “Caase.com”), a Dutch cloud service provider, for a purchase price, net of cash acquired, of approximately $6,038,000, subject to a final working capital adjustment. The acquisition was funded using cash on hand.

Effective January 6, 2017, we acquired Datalink Corporation (“Datalink”), a leading provider of IT services and enterprise data center solutions based in Eden Prairie, Minnesota, for a cash purchase price of $257,456,000, which included cash and cash equivalents acquired of $76,597,000. The acquisition was funded using cash on hand and borrowings under our revolving facility in the form of an incremental Term Loan A (“TLA”).

Effective September 1, 2016, we acquired Ignia Pty Ltd (“Ignia”), a business technology consulting and managed services provider headquartered in Perth, Australia, with an additional office in Melbourne, for a cash purchase price, net of cash acquired, of approximately $10,804,000. The acquisition was funded using cash on hand.

Effective October 1, 2015, we acquired BlueMetal Architects, Inc. (“BlueMetal”), an interactive design and technology architecture firm based in the Boston area with offices in Chicago and New York, for a cash purchase price, net of cash acquired, of approximately $44,221,000. The acquisition was funded using borrowings under our accounts receivable securitization financing facility.

Our results of operations include the results of Caase.com, Datalink, Ignia and BlueMetal from their respective acquisition dates. (See Note 21 for a discussion of our acquisitions.)

Principles of Consolidation and Presentation

Principles of Consolidation and Presentation

The consolidated financial statements include the accounts of Insight Enterprises, Inc. and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. References to “the Company,” “Insight,” “we,” “us,” “our” and other similar words refer to Insight Enterprises, Inc. and its consolidated subsidiaries, unless the context suggests otherwise.

Use of Estimates

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Additionally, these estimates and assumptions affect the reported amounts of net sales and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts, valuation of inventories, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

Cash and Cash Equivalents

Cash and Cash Equivalents

We consider all highly liquid investments with maturities at the date of purchase of three months or less to be cash equivalents.    

Book overdrafts represent the amount by which outstanding checks issued, but not yet presented to our banks for disbursement, exceed balances on deposit in applicable bank accounts and a legal right of offset with our positive cash balances in other financial institution accounts does not exist. Our book overdrafts, which are not directly linked to a credit facility or other bank overdraft arrangement, do not result in an actual bank financing, but rather constitute normal unpaid trade payables at the end of a reporting period. These amounts are included within our accounts payable balance in our consolidated balance sheets. The changes in these book overdrafts are included within the changes in accounts payable line item as a component of cash flows from operating activities in our consolidated statements of cash flows.

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts

We establish an allowance for doubtful accounts to reflect our best estimate of probable losses inherent in our accounts receivable balance. The allowance is based on our evaluation of the aging of the receivables, historical write-offs and the current economic environment. We write off individual accounts against the reserve when we no longer believe that it is probable that we will collect the receivable because we become aware of a client’s or partner’s inability to meet its financial obligations. Such awareness may be as a result of bankruptcy filings, or deterioration in the client’s or partner’s operating results or financial position.

Inventories

Inventories

We state inventories, principally purchased IT hardware, at the lower of weighted average cost (which approximates cost under the first-in, first-out method) or net realizable value. We evaluate inventories for excess, obsolescence or other factors that may render inventories unmarketable at normal margins. Write-downs are recorded so that inventories reflect the approximate net realizable value and take into account contractual provisions with our partners governing price protection, stock rotation and return privileges relating to obsolescence. Because of the large number of transactions and the complexity of managing the price protection and stock rotation process, estimates are made regarding write-downs of the carrying amount of inventories. Additionally, assumptions about future demand, market conditions and decisions by manufacturers/publishers to discontinue certain products or product lines can affect our decision to write down inventories.

Inventories not available for sale relate to product sales transactions in which we are warehousing the product and will be deploying the product to our clients’ designated locations subsequent to period-end. Additionally, we may perform services on a portion of the product prior to shipment to our clients and will be paid a fee for doing so. Although these product contracts are non-cancelable with customary credit terms beginning the date the inventories are segregated in our warehouse and invoiced to the client and the warranty periods begin on the date of invoice, these transactions do not meet the sales recognition criteria under GAAP. Therefore, we do not record sales and the inventories are classified as inventories not available for sale on our consolidated balance sheet until the product is delivered. If clients remit payment before we deliver the product to them, we record the payments received as deferred revenue on our consolidated balance sheet until such time as the product is delivered.

Property and Equipment

Property and Equipment

We record property and equipment at cost. We capitalize major improvements and betterments, while maintenance, repairs and minor replacements are expensed as incurred. Depreciation or amortization is provided using the straight-line method over the following estimated economic lives of the assets:

	Estimated Economic Life
Leasehold improvements	Shorter of underlying lease term or asset life
Furniture and fixtures	2 – 7 years
Equipment	3 – 5 years
Software	3 – 10 years
Buildings	29 years

Costs incurred to develop internal-use software during the application development stage, including capitalized interest, are recorded in property and equipment at cost. External direct costs of materials and services consumed in developing or obtaining internal-use computer software and payroll and payroll-related costs for teammates who are directly associated with and who devote time to internal-use computer software development projects, to the extent of the time spent directly on the project and specific to application development, are capitalized.

Reviews are regularly performed to determine whether facts and circumstances exist which indicate that the useful life is shorter than originally estimated or the carrying amount of assets may not be recoverable. When an indication exists that the carrying amount of long-lived assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

Goodwill

Goodwill

Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of net identified tangible and intangible assets acquired. Goodwill is tested for impairment at the reporting unit level on an annual basis in the fourth quarter and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. We may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform a quantitative goodwill impairment test. Otherwise, the goodwill impairment test is not required. The quantitative goodwill impairment review process compares the fair value of the reporting unit in which goodwill resides to its carrying value. The Company has three reporting units, which are the same as our operating segments. Multiple valuation techniques can be used to assess the fair value of the reporting unit. All of these techniques include the use of estimates and assumptions that are inherently uncertain. Changes in these estimates and assumptions could materially affect the determination of fair value or goodwill impairment, or both.

Intangible Assets

Intangible Assets

We amortize intangible assets acquired in business combinations using the straight-line method over the following estimated economic lives of the intangible assets from the date of acquisition:

	Estimated Economic Life
Customer relationships	2 –11 years
Tradenames and Restrictive Covenant Agreements	9 months –3 years

We regularly perform reviews to determine if facts and circumstances exist which indicate that the useful lives of our intangible assets are shorter than originally estimated or the carrying amount of these assets may not be recoverable. When an indication exists that the carrying amount of intangible assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts. Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

Trade Credits

Trade Credits

Trade credit liabilities arise from aged unclaimed credit memos, duplicate payments, payments for returned product or overpayments made to us by our clients, and, to a lesser extent, from goods received by us from a partner for which we were never invoiced. Trade credit liabilities are included in accrued expenses and other current liabilities in our consolidated balance sheets. We derecognize the liability only if it has been extinguished, upon either (1) our payment of the liability to relieve our obligation or (2) our legal release from the related obligation, which is recorded as a reduction of costs of goods sold.

Self Insurance

Self-Insurance

We are self-insured in the United States for medical insurance up to certain annual stop-loss limits and workers’ compensation claims up to certain deductible limits. We establish reserves for claims, both reported and incurred but not reported, using currently available information as well as our historical claims experience.

Treasury Stock

Treasury Stock

We record repurchases of our common stock as treasury stock at cost. We also record the subsequent retirement of these treasury shares at cost. The excess of the cost of the shares retired over their par value is allocated between additional paid-in capital and retained earnings. The amount recorded as a reduction of paid-in capital is based on the excess of the average original issue price of the shares over par value. The remaining amount is recorded as a reduction of retained earnings.

Sales Recognition

Sales Recognition

Sales are recognized when title and risk of loss are passed to the client, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable and collectibility is reasonably assured. Our standard sales terms are F.O.B. shipping point or equivalent, at which time title and risk of loss have passed to the client. However, because we either (i) have a general practice of covering client losses while products are in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) have specifically stated F.O.B. destination contractual terms with the client, delivery is not deemed to have occurred until the point in time when the product is received by the client. We make provisions for estimated product returns that we expect to occur under our return policy based upon historical return rates.

We leverage drop-shipment arrangements with many of our partners and suppliers to deliver products to our clients without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs. We recognize revenue for drop-shipment arrangements on a gross basis when the product is received by the client. We recognize revenue on a gross basis as the principal in the transaction because we control the transaction as the primary obligor for product fulfillment in the arrangement, we assume inventory risk if the product is returned by the client, we set the price of the product charged to the client, we assume credit risk for the amounts invoiced, and we work closely with our clients to determine their hardware and software specifications.

We record the freight we bill to our clients as net sales and the related freight costs we pay as costs of goods sold. We report sales net of any sales-based taxes assessed by governmental authorities that are imposed on and concurrent with sales transactions.

Revenue is recognized from software sales when clients acquire the right to use or copy software under license, but in no case prior to the commencement of the term of the initial software license agreement, provided that all other revenue recognition criteria have been met (i.e., evidence of the arrangement exists, the fee is fixed or determinable and collectibility of the fee is probable).

We sell certain third-party service contracts, software maintenance and cloud or software-as-a-service subscription products for which we are not the primary obligor. These sales do not meet the criteria for gross sales recognition, and thus are recorded on a net sales recognition basis. As we enter into contracts with third-party service providers or vendors and our clients, we evaluate whether the subsequent sales of such services should be recorded as gross sales or net sales. We determine whether we act as a principal in the transaction and assume the risks and rewards of ownership or if we are simply acting as an agent or broker. Under gross sales recognition, the selling price is recorded in sales and our cost to the third-party service provider or vendor is recorded in costs of goods sold. Under net sales recognition, the cost to the third-party service provider or vendor is recorded as a reduction to sales, resulting in net sales equal to the gross profit on the transaction, and there are no costs of goods sold.

We recognize revenue for sales of services ratably over the time period over which the service will be provided if there is no discernible pattern of recognition of the cost to perform the service. Billings for such services that are made in advance of the related revenue recognized are recorded as deferred revenue and recognized as revenue ratably over the billing coverage period. Revenue from certain arrangements that allow for the use of a product or service over a period of time without taking possession of software are also accounted for ratably over the time period over which the service will be provided.

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred as the services are performed and amounts are earned. Net sales for these services engagements are not a significant portion of our consolidated net sales.

Additionally, we sell certain professional services contracts on a fixed fee basis. Revenues for fixed fee professional services contracts are recognized based on the ratio of costs incurred to total estimated costs. Net sales for these service contracts are not a significant portion of our consolidated net sales.

In certain arrangements, we may provide a combination of hardware and software products and the provision of services. Services that are performed by us in conjunction with hardware and software sales that are completed in our facilities prior to shipment of the product are recognized upon delivery, when title passes to the client, for the hardware sale. Net sales of services that are performed at client locations are primarily service-only contracts and are recorded as sales when the services are performed. The total consideration for an arrangement with multiple deliverables is allocated to all deliverables that represent a separate unit of accounting using the relative selling price method.

Costs of Goods Sold

Costs of Goods Sold

Costs of goods sold include product costs, direct costs incurred associated with delivering services, outbound and inbound freight costs and provisions for inventory reserves. These costs are reduced by provisions for supplier discounts and certain payments and credits received from partners, as described under “Partner Funding” below.

Selling and Administrative Expenses

Selling and Administrative Expenses

Selling and administrative expenses include salaries and wages, bonuses and incentives, stock-based compensation expense, employee-related expenses, facility-related expenses, marketing and advertising expense, reduced by certain payments and credits received from partners related to shared marketing expense programs, as described under “Partner Funding” below, depreciation of property and equipment, professional fees, amortization of intangible assets, provisions for losses on accounts receivable and other operating expenses.

Partner Funding

Partner Funding

We receive payments and credits from partners, including consideration pursuant to volume sales incentive programs, volume purchase incentive programs and shared marketing expense programs. Partner funding received pursuant to volume sales incentive programs is recognized as it is earned as a reduction to costs of goods sold. Partner funding received pursuant to volume purchase incentive programs is allocated as a reduction to inventories based on the applicable incentives earned from each partner and is recorded in cost of goods sold as the related inventory is sold. Partner funding received pursuant to shared marketing expense programs is recorded as it is earned as a reduction of the related selling and administrative expenses in the period the program takes place if the consideration represents a reimbursement of specific, incremental, identifiable costs. Consideration that exceeds the specific, incremental, identifiable costs is classified as a reduction of costs of goods sold. The amount of partner funding recorded as a reduction of selling and administrative expenses in our statements of operations totaled $53,227,000, $48,114,000 and $45,146,000 in 2017, 2016 and 2015, respectively.

Concentrations of Risk

Concentrations of Risk

Credit Risk

Although we are affected by the international economic climate, management does not believe material credit risk concentration existed at December 31, 2017. We monitor our clients’ financial condition and do not require collateral. Sales to the U.S. federal government, which are diversified across multiple agencies and departments, collectively accounts for approximately 9% of our 2017 net sales. Excluding these sales to the federal government, we are not reliant on any one client. No single client accounted for more than 4% of our consolidated net sales in 2017.

Supplier Risk

Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2017. No other partner accounted for more than 10% of purchases in 2017. Our top five partners as a group for 2017 were Microsoft, Cisco Systems, Tech Data (a distributor), Dell and HP Inc., and approximately 60% of our total purchases during 2017 came from this group of partners. Although brand names and individual products are important to our business, we believe that competitive sources of supply are available in substantially all of our product categories such that, with the exception of Microsoft, we are not dependent on any single partner for sourcing products.

Advertising Costs

Advertising Costs

Advertising costs are expensed as they are incurred. Advertising expense of $47,053,000, $37,565,000 and $33,568,000 was recorded in 2017, 2016 and 2015, respectively. These amounts were predominantly offset by partner funding earned pursuant to shared marketing expense programs recorded as a reduction of selling and administrative expenses, as discussed in “Partner Funding” above.

Stock-Based Compensation

Stock-Based Compensation

Stock-based compensation is measured based on the fair value of the award on the date of grant and the corresponding expense is recognized over the period during which an employee is required to provide service in exchange for the reward. Stock-based compensation expense is classified in the same line item of our consolidated statements of operations as other payroll-related expenses specific to the employee. Compensation expense related to service-based restricted stock units (“RSUs”) is recognized on a straight-line basis over the requisite service period for the entire award. Compensation expense related to performance-based RSUs is recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards (i.e., a graded vesting basis).

Foreign Currencies

Foreign Currencies

We use the U.S. dollar as our reporting currency. The functional currencies of our foreign subsidiaries are the local currencies. Accordingly, assets and liabilities of the subsidiaries are translated into U.S. dollars at the exchange rate in effect at the balance sheet dates. Income and expense items are translated at the average exchange rate for each month within the year. The resulting translation adjustments are recorded directly in accumulated other comprehensive income, net of tax – foreign currency translation adjustments as a separate component of stockholders’ equity. Net foreign currency transaction gains/losses, including transaction gains/losses on intercompany balances that are not of a long-term investment nature and non-functional currency cash balances, are reported as a separate component of non-operating (income) expense in our consolidated statements of operations.

Derivative Financial Instruments

Derivative Financial Instruments

We enter into forward foreign exchange contracts to mitigate the risk of non-functional currency monetary assets and liabilities on our consolidated financial statements. These forward contracts are not designated as hedge instruments. The fair value of all derivative assets and liabilities are recorded gross in the other current assets and accrued expenses and other current liabilities sections of our consolidated balance sheets. Gains/losses are recorded net in non-operating (income) expense in our consolidated statements of operations.

Income Taxes

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable earnings in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date.

We recognize net deferred tax assets to the extent that we believe these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and results of recent operations. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

We record uncertain tax positions on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Interest and penalties related to unrecognized tax benefits are recognized within the income tax expense line in our consolidated statements of operations. Accrued interest and penalties are included within the related tax liability line in our consolidated balance sheets.

Net Earnings Per Share ("EPS")

Net Earnings Per Share (“EPS”)

Basic EPS is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during each year. Diluted EPS is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding RSUs. A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Years Ended December 31,
	2017		2016		2015
Numerator:
Net earnings	$	90,683	$	84,690	$	75,851
Denominator:
Weighted-average shares used to compute basic EPS		35,741		36,102		37,984
Dilutive potential common shares due to dilutive RSUs, net of tax effect		466		336		291
Weighted-average shares used to compute diluted EPS		36,207		36,438		38,275
Net earnings per share:
Basic	$	2.54	$	2.35	$	2.00
Diluted	$	2.50	$	2.32	$	1.98

In 2017, 2016 and 2015, approximately 40,000, 36,000 and 1,000, respectively, of our RSUs were not included in the diluted EPS calculations because their inclusion would have been anti-dilutive. These share-based awards could be dilutive in the future.

Recently Issued Accounting Standards

Recently Issued Accounting Standards

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2017-04, “Simplifying the Test for Goodwill Impairment.” The new standard requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The new standard is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. We adopted this new standard when we performed our annual goodwill impairment analysis for 2017 in the fourth quarter of 2017 and applied it prospectively. The adoption of this standard did not have a material effect on our consolidated financial statements. See “Goodwill” above for further details about our test for goodwill impairment.

In November 2016, the FASB issued ASU No. 2016-18, “Restricted Cash.” The new standard requires companies to include cash and cash equivalents that have restrictions on withdrawal or use within total cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. The new standard is required to be adopted retrospectively. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments.” The new standard is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. It addresses eight specific cash flow issues to clarify the presentation and classification of cash receipts and cash payments in the statement of cash flows. The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. The new standard is required to be adopted retrospectively. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting.” This new standard simplifies the accounting for share-based payment transactions, including the income tax consequences, the calculation of diluted earnings per share, the treatment of forfeitures, the classification of awards as either equity or liabilities and the classification on the statement of cash flows. This new standard increases volatility in the statement of operations by requiring all excess tax benefits and deficiencies to be recognized as income tax benefit or expense in the statement of operations and treated as discrete items in the period in which they occur. We adopted the new standard as of January 1, 2017, and prospectively applied the provisions in this guidance requiring recognition of excess tax benefits and deficits in the statement of operations, which resulted in an income tax benefit of $2,483,000 for the year ended December 31, 2017. The corresponding increase in net earnings equated to $0.07 per diluted share during the year ended December 31, 2017. Also, as a result of the adoption of the new standard, we made an accounting policy election to recognize forfeitures as they occur and no longer estimate expected forfeitures. The provisions in this guidance requiring the use of a modified retrospective transition method would have required us to record a cumulative effect adjustment in retained earnings as of January 1, 2017. We elected not to adjust retained earnings and to record such cumulative effect adjustment as stock-based compensation in the first quarter of 2017 on the basis of immateriality. Lastly, we applied the provisions of this guidance relating to classification on the statement of cash flows retrospectively. As a result, excess tax benefits from employee gains on stock-based compensation of $323,000 and $592,000 were reclassified from cash flows from financing activities to cash flows from operating activities for the years ended December 31, 2016 and 2015, respectively, to conform to the current period presentation.

In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which supersedes the existing lease recognition requirements in the existing accounting standard for leases. The core principal of the new standard is that an entity should recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years. Early adoption is permitted. The new standard is to be applied using a modified retrospective transition method with the option to elect a number of practical expedients. We expect to adopt the new standard in the first quarter of 2019 and are in the process of determining the effect that the adoption of ASU 2016-02 will have on our consolidated financial statements and disclosures. We have not yet selected our planned transition approach.

In January 2016, the FASB issues ASU No. 2016-01, “Financial Instruments Overview: Recognition and Measurement of Financial Assets and Financial Liabilities.” The new standard amends the guidance on the classification and measurement of financial instruments and changes the accounting for investments in equity securities. The new standard is effective for annual and interim periods in fiscal years beginning after December 15, 2017, and early adoption is permitted. We plan to adopt this new standard in the first quarter of 2018 and do not expect the adoption to have a material effect on our consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” This standard changes the measurement from lower of cost or market to lower of cost and net realizable value. We adopted the standard in the first quarter of 2017 and applied the provisions prospectively. The standard did not have a material effect on our consolidated financial statements.

On May 28, 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” which amends the existing accounting standards for revenue recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard, as amended, will be effective for the Company beginning in the first quarter of 2018. The standard permits two methods of adoption: retrospectively to each prior reporting period presented (the full retrospective transition method) or retrospectively with the cumulative effect adjustment of initially applying the new standard recognized at the date of initial application (the modified retrospective transition method).

We will adopt the standard as of January 1, 2018, and will utilize the modified retrospective transition method. While we are still finalizing our accounting policies under the new standard and are in the process of quantifying the cumulative effect adjustment from prior periods that will be recognized in our consolidated balance sheet as of the date of adoption as an adjustment to retained earnings, to date we have concluded:

• In sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we will change to record both the software license and the accompanying software maintenance on a net basis, as the agent in the arrangement. Under current guidance, we bifurcate the sale of the software license from the sale of the maintenance contract, record the sale of the software product on a gross basis, as the principal in the arrangement, and record the sale of the software maintenance on a net basis, as an agent in the arrangement. This change will lead us to report lower net sales in future periods related to security software products. This change will have no effect on gross profit dollars, but all other things being equal, gross margin for these specific sales would increase compared to prior years.

• The accounting for inventories not available for sale, otherwise known as bill and hold arrangements, will change such that a portion of revenue under the contracts will be recognized earlier than we are recognizing under current accounting standards. Bill and hold arrangements are inventory balances owned and paid for by our clients, but for which we are warehousing the product and will be deploying it to the clients’ locations in a future period.

• The accounting for renewals of certain software term licenses will change to delay revenue recognition until the beginning of the renewal period. Under current guidance, we recognize revenue as the renewal order is completed. We do not believe this change will have a material effect on our sales or profitability trends, as it is only a change in timing of recognition between periods.

• Sales commissions on contracts with performance periods that exceed one year will be recorded as an asset and amortized to expense over the related contract performance period as opposed to being expensed in the period the transaction is generated.

Our analysis and evaluation of the new standard will continue through to when we publish our first quarter of 2018 results. A substantial amount of work has been completed, and findings and progress to date have been reported to management and the Audit Committee. Although we currently believe that the changes overall resulting from the adoption of the new standard will not lead to operating trends that are materially different than we reported in prior years, our evaluation of the effects is still being finalized. Currently, we estimate the total cumulative effect adjustment from prior periods that will be recognized in our consolidated balance sheet as of the date of adoption as an adjustment to retained earnings to be less than $10,000,000, on a pretax basis.

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Operations and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Estimated Economic Lives of Property and Equipment

We record property and equipment at cost. We capitalize major improvements and betterments, while maintenance, repairs and minor replacements are expensed as incurred. Depreciation or amortization is provided using the straight-line method over the following estimated economic lives of the assets:

	Estimated Economic Life
Leasehold improvements	Shorter of underlying lease term or asset life
Furniture and fixtures	2 – 7 years
Equipment	3 – 5 years
Software	3 – 10 years
Buildings	29 years

Estimated Economic Life of Acquired Amortizable Intangible Assets

We amortize intangible assets acquired in business combinations using the straight-line method over the following estimated economic lives of the intangible assets from the date of acquisition:

	Estimated Economic Life
Customer relationships	2 –11 years
Tradenames and Restrictive Covenant Agreements	9 months –3 years

Reconciliation of Denominators of Basic and Diluted EPS Calculations

A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Years Ended December 31,
	2017		2016		2015
Numerator:
Net earnings	$	90,683	$	84,690	$	75,851
Denominator:
Weighted-average shares used to compute basic EPS		35,741		36,102		37,984
Dilutive potential common shares due to dilutive RSUs, net of tax effect		466		336		291
Weighted-average shares used to compute diluted EPS		36,207		36,438		38,275
Net earnings per share:
Basic	$	2.54	$	2.35	$	2.00
Diluted	$	2.50	$	2.32	$	1.98

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Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2017

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and equipment consist of the following (in thousands):

	December 31,
	2017			2016
Software	$	171,701		$	159,442
Buildings		65,468			63,253
Equipment		103,542			93,553
Furniture and fixtures		38,459			36,526
Leasehold improvements		25,981			21,132
Land		5,179			5,131
		410,330			379,037
Accumulated depreciation and amortization		(335,078	)		(308,127	)
Property and equipment, net	$	75,252		$	70,910

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Goodwill (Tables)

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in Carrying Amount of Goodwill

The changes in the carrying amount of goodwill for the year ended December 31, 2017 are as follows (in thousands):

	North America			EMEA			APAC			Consolidated
Goodwill	$	379,617		$	151,439		$	13,973		$	545,029
Accumulated impairment losses		(323,422	)		(151,439	)		(13,973	)		(488,834	)
Goodwill acquired during 2016		(507	)		—			6,957			6,450
Balance at December 31, 2016		55,688			—			6,957			62,645
Goodwill acquired during 2017		64,140			4,041			605			68,786
Balance at December 31, 2017	$	119,828		$	4,041		$	7,562		$	131,431

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Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Intangible Assets, Net

Intangible assets consist of the following (in thousands):

	December 31,
	2017			2016
Customer relationships	$	133,660		$	41,711
Other		4,475			1,978
		138,135			43,689
Accumulated amortization		(37,357	)		(22,982	)
Intangible assets, net	$	100,778		$	20,707

Future Amortization Expenses

$10,637,000 and $11,308,000, respectively. Future amortization expense for the remaining unamortized balance as of December 31, 2017 is estimated as follows (in thousands):

Years Ending December 31,	Amortization Expense
2018	$	14,260
2019		11,690
2020		11,677
2021		11,638
2022		11,638
Thereafter		39,875
Total amortization expense	$	100,778

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Debt, Capital Lease and Other Financing Obligations (Tables)

12 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Long-Term Debt

Our long-term debt consists of the following (in thousands):

	December 31,
	2017			2016
Senior revolving credit facility	$	117,500		$	—
Term Loan A (less unamortized debt issuance costs of $873)		165,377			—
Accounts receivable securitization financing facility		25,000			39,500
Capital leases and other financing obligations		5,291			1,231
Total		313,168			40,731
Less: current portion of long-term debt		(16,592	)		(480	)
Long-term debt	$	296,576		$	40,251

Schedule of Future Minimum Lease Payments for Capital Leases

Future minimum payments under the capitalized leases consist of the following as of December 31, 2017 (in thousands):

Years Ending December 31,
2018	$	1,550
2019		1,016
2020		381
Total minimum lease payments		2,947
Less amount representing interest		(145	)
Present value of minimum lease payments	$	2,802

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Operating Leases (Tables)

12 Months Ended

Dec. 31, 2017

Leases [Abstract]

Future Minimum Lease Payments

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2017 are as follows (in thousands):

Years Ending December 31,
2018		18,601
2019		16,617
2020		12,122
2021		9,170
2022		6,966
Thereafter		12,023
Total minimum lease payments	$	75,499

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Severance and Restructuring Activities (Tables)

12 Months Ended

Feb. 21, 2018

Restructuring and Related Activities [Abstract]

Activity Related to Resource Actions and Outstanding Obligations

The following table details the activity for each of the three years in the period ending December 31, 2017 related to these resource actions, and the outstanding obligations as of December 31, 2017 (in thousands):

	North America			EMEA			APAC			Consolidated
Balances at December 31, 2014	$	857		$	2,971		$	—		$	3,828
Severance costs, net of adjustments		1,126			3,781			—			4,907
Cash payments		(1,456	)		(3,534	)		—			(4,990	)
Foreign currency translation adjustments		(22	)		(235	)		—			(257	)
Balances at December 31, 2015		505			2,983			—			3,488
Severance costs, net of adjustments		2,966			1,496			118			4,580
Cash payments		(2,524	)		(3,239	)		(118	)		(5,881	)
Foreign currency translation adjustments		—			(23	)		—			(23	)
Balances at December 31, 2016		947			1,217			—			2,164
Severance costs, net of adjustments		4,010			4,888			104			9,002
Cash payments		(3,336	)		(3,597	)		(89	)		(7,022	)
Foreign currency translation adjustments		10			486			—			496
Balances at December 31, 2017	$	1,631		$	2,994		$	15		$	4,640

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Stock-Based Compensation (Tables)

12 Months Ended

Feb. 21, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Pre-tax Amounts by Operating Segment for Stock-Based Compensation

We recorded the following pre-tax amounts in selling and administrative expenses for stock-based compensation, by operating segment, in the accompanying consolidated financial statements (in thousands):

	Years Ended December 31,
	2017		2016		2015
North America	$	9,697	$	8,096	$	6,648
EMEA		2,737		2,530		1,908
APAC		392		432		366
Total Consolidated	$	12,826	$	11,058	$	8,922

Summary of Restricted Stock Units Activity

The following table summarizes our RSU activity during 2017:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at the beginning of year		1,067,557		$	25.37
Granted		369,438		$	44.12
Vested, including shares withheld to cover taxes		(466,839	)	$	24.88	$	20,284,762	(a)
Forfeited		(78,043	)	$	32.16
Nonvested at the end of year		892,113		$	32.86	$	34,159,007	(b)

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Income Taxes (Tables)

12 Months Ended

Feb. 21, 2018

Income Tax Disclosure [Abstract]

Earnings Before Income Taxes

Earnings before income taxes:

	Years Ended December 31,
	2017		2016		2015
United States	$	119,330	$	99,095	$	90,575
Foreign		39,768		40,363		28,601
	$	159,098	$	139,458	$	119,176

Income Tax Expense

Income tax expense:

	Years Ended December 31,
	2017			2016			2015
Current:
U.S. Federal	$	31,067		$	27,947		$	24,369
U.S. State and local		3,636			2,200			2,705
Foreign		14,573			14,104			11,077
		49,276			44,251			38,151
Deferred:
U.S. Federal		20,327			10,395			5,104
U.S. State and local		(427	)		1,088			602
Foreign		(761	)		(966	)		(532	)
		19,139			10,517			5,174
	$	68,415		$	54,768		$	43,325

Schedule Reconciles Difference Between U.S. Federal Income Taxes at U.S. Statutory Rate and Our Income Tax Expense

The following schedule reconciles the differences between the U.S. federal income taxes at the U.S. statutory rate and our income tax expense (dollars in thousands):

	2017					2016					2015
Statutory federal income tax rate	$	55,684		35.0	%	$	48,810		35.0	%	$	41,712		35.0	%
State income tax expense, net of federal income tax benefit		2,808		1.8			3,368		2.4			3,180		2.7
Audits and adjustments, net		(313	)	(0.2	)		(1,039	)	(0.7	)		(886	)	(0.7	)
Change in valuation allowances		2,472		1.5			3,742		2.7			2,944		2.5
Foreign income taxed at different rates		(6,057	)	(3.8	)		(6,611	)	(4.7	)		(5,729	)	(4.8	)
U.S. mandatory deemed repatriation		5,625		3.5			—		—			—		—
Adjustment of net deferred tax assets for enacted U.S. federal tax reform		7,738		4.9			—		—			—		—
Change in U.S. tax law applicable to certain foreign entities		—		—			2,577		1.8			—		—
Non-deductible compensation		571		0.4			518		0.4			474		0.4
Other, net		(113	)	(0.1	)		3,403		2.4			1,630		1.3
Effective tax rate	$	68,415		43.0	%	$	54,768		39.3	%	$	43,325		36.4	%

Significant Components of Deferred Tax Assets and Liabilities

The significant components of deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2017			2016
Deferred tax assets:
Net operating losses	$	25,418		$	18,964
Foreign tax credits		21,346			13,115
Accruals		5,921			6,426
Goodwill and other intangibles		4,717			35,523
Stock-based compensation		3,023			4,238
Accounts receivable		2,124			2,547
Inventories		1,930			2,598
Property and equipment		1,111			705
Deferred revenue		600			468
Other		335			55
Gross deferred tax assets		66,525			84,639
Valuation allowances		(45,995	)		(30,972	)
Total deferred tax assets		20,530			53,667
Deferred tax liabilities:
Goodwill and other intangibles		(1,587	)		(1,221	)
Accrued withholding tax		(1,452	)		—
Prepaid expenses		(369	)		(204	)
Other		(775	)		(795	)
Total deferred tax liabilities		(4,183	)		(2,220	)
Net deferred tax assets	$	16,347		$	51,447

Net Non-Current Deferred Tax Assets and Liabilities

The net non-current deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2017			2016
Net non-current deferred tax assets	$	17,064		$	52,347
Net non-current deferred tax liabilities		(717	)		(900	)
Net deferred tax assets	$	16,347		$	51,447

Change in Valuation Allowance

The following table summarizes the change in the valuation allowance (in thousands):

	December 31,
	2017			2016
Valuation allowances at beginning of year	$	30,972		$	28,750
Increase in income tax expense		2,472			3,742
U.S. federal tax reform		11,623			—
Foreign currency translation adjustments		2,865			(1,035	)
Other		(1,937	)		(485	)
Valuation allowances at end of year	$	45,995		$	30,972

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest, is as follows (in thousands):

Balance at December 31, 2016	$	2,051
Additions for tax positions added through acquisition		2,484
Subtractions for tax positions in prior periods		(59	)
Additions for tax positions in current period		867
Additions due to foreign currency translation		53
Subtractions due to audit settlements and statute expirations		(1,410	)
Balance at December 31, 2017	$	3,986

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Share Repurchase Programs (Tables)

12 Months Ended

Dec. 31, 2017

Equity [Abstract]

Summary of Shares of Common Stock Repurchased Under Repurchase Programs

The following table summarizes the shares of our common stock that we repurchased on the open market under these repurchase programs during the years ended December 31, 2017, 2016 and 2015, respectively, in thousands, except per share amounts:

Year	Total Number of Shares Purchased		Average Price Paid per Share		Approximate Dollar Value of Shares Purchased
2017		—	$	—	$	—
2016		1,891		26.43		50,000
2015		3,300		27.83		91,843
Total		5,191			$	141,843

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Supplemental Financial Information (Tables)

12 Months Ended

Feb. 21, 2018

Receivables [Abstract]

Summary of Additions and Deductions Related to Allowances for Doubtful Accounts

Additions and deductions related to the allowance for doubtful accounts receivable for 2017, 2016 and 2015 were as follows (in thousands):

	Balance at Beginning of Year		Additions		Deductions			Balance at End of Year
Allowance for doubtful accounts receivable:
Year ended December 31, 2017	$	9,138	$	5,245	$	(4,225	)	$	10,158
Year ended December 31, 2016	$	11,872	$	2,452	$	(5,186	)	$	9,138
Year ended December 31, 2015	$	19,336	$	6,761	$	(14,225	)	$	11,872

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Cash Flows (Tables)

12 Months Ended

Feb. 21, 2018

Supplemental Cash Flow Elements [Abstract]

Schedule of Cash Payments for Interest on Indebtedness and Cash Payments for Taxes on Income

Cash payments for interest on indebtedness and cash payments for taxes on income were as follows (in thousands):

	Years Ended December 31,
	2017		2016		2015
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$	10,976	$	3,782	$	2,866
Cash paid during the year for income taxes, net of refunds	$	55,470	$	39,051	$	41,062

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Segment and Geographic Information (Tables)

12 Months Ended

Feb. 21, 2018

Segment Reporting [Abstract]

Net Sales by Offering for North America, EMEA and APAC

The following tables summarize net sales by offering for North America, EMEA and APAC including the effect of the reclassifications on the previously reported net sales by sales mix amounts for the years ended December 31, 2016 and 2015 (in thousands):

	North America Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	3,352,355	$	2,454,889	$	2,336,764
Software		1,310,118		1,146,808		1,157,168
Services		519,261		370,131		329,596
	$	5,181,734	$	3,971,828	$	3,823,528

In North America, fees earned from activities reported on a net basis of $270,000 and $87,984,000 that were previously reported as part of our hardware and software product categories, respectively, in 2016, and fees earned from activities reported on a net basis of $24,000 and $74,101,000 that were previously reported as part of our hardware and software product categories, respectively, in 2015, were reclassified to services to conform to the current year presentation.

	EMEA Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	536,500	$	481,505	$	531,308
Software		710,452		762,427		756,373
Services		108,464		94,628		83,456
	$	1,355,416	$	1,338,560	$	1,371,137

In EMEA, fees earned from activities reported on a net basis of $48,586,000 and $43,388,000 that were previously reported as part of our software product category in 2016 and 2015, respectively, were reclassified to services to conform to the current year presentation.

	APAC Years Ended December 31,
Sales Mix	2017		2016		2015
			(As Reclassified)		(As Reclassified)
Hardware	$	27,907	$	18,916	$	14,327
Software		101,412		132,718		149,607
Services		37,154		23,493		14,491
	$	166,473	$	175,127	$	178,425

Financial Information about Reportable Operating Segments

The tables below present information about our reportable operating segments (in thousands):

	Year Ended December 31, 2017
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	4,662,473	$	1,246,952	$	129,319	$	6,038,744
Services		519,261		108,464		37,154		664,879
Total net sales		5,181,734		1,355,416		166,473		6,703,623
Costs of goods sold:
Products		4,253,587		1,140,204		118,611		5,512,402
Services		236,470		24,902		11,279		272,651
Total costs of goods sold		4,490,057		1,165,106		129,890		5,785,053
Gross profit		691,677		190,310		36,583		918,570
Operating expenses:
Selling and administrative expenses		530,792		164,305		28,231		723,328
Severance and restructuring expenses		4,010		4,888		104		9,002
Loss on sale of foreign entity		—		3,646		—		3,646
Acquisition-related expenses		3,223		106		—		3,329
Earnings from operations	$	153,652	$	17,365	$	8,248	$	179,265
Total assets	$	2,337,573	$	530,242	$	101,169	$	2,968,984	*
	Year Ended December 31, 2016
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	3,601,697	$	1,243,932	$	151,634	$	4,997,263
Services		370,131		94,628		23,493		488,252
Total net sales		3,971,828		1,338,560		175,127		5,485,515
Costs of goods sold:
Products		3,301,148		1,129,917		140,397		4,571,462
Services		145,199		22,956		2,796		170,951
Total costs of goods sold		3,446,347		1,152,873		143,193		4,742,413
Gross profit		525,481		185,687		31,934		743,102
Operating expenses:
Selling and administrative expenses		401,316		160,269		23,658		585,243
Severance and restructuring expenses		2,966		1,496		118		4,580
Acquisition-related expenses		4,278		—		169		4,447
Earnings from operations	$	116,921	$	23,922	$	7,989	$	148,832
Total assets	$	2,204,351	$	562,293	$	119,778	$	2,886,422	*

	Year Ended December 31, 2015
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	3,493,932	$	1,287,681	$	163,934	$	4,945,547
Services		329,596		83,456		14,491		427,543
Total net sales		3,823,528		1,371,137		178,425		5,373,090
Costs of goods sold:
Products		3,196,297		1,167,113		149,943		4,513,353
Services		125,668		17,737		—		143,405
Total costs of goods sold		3,321,965		1,184,850		149,943		4,656,758
Gross profit		501,563		186,287		28,482		716,332
Operating expenses:
Selling and administrative expenses		396,603		165,879		22,424		584,906
Severance and restructuring expenses		1,126		3,781		—		4,907
Earnings from operations	$	103,834	$	16,627	$	6,058	$	126,519
Total assets	$	1,999,485	$	543,146	$	114,973	$	2,657,604	*

Summary of Geographic Net Sales and Long-Lived Assets

The following is a summary of our geographic net sales and long-lived assets, consisting of property and equipment, net (in thousands):

	United States		United Kingdom		Other Foreign		Total
2017
Net sales	$	4,933,805	$	684,632	$	1,085,186	$	6,703,623
Total long-lived assets	$	50,462	$	14,783	$	10,007	$	75,252
2016
Net sales	$	3,776,352	$	671,999	$	1,037,164	$	5,485,515
Total long-lived assets	$	46,774	$	13,570	$	10,566	$	70,910
2015
Net sales	$	3,645,876	$	711,957	$	1,015,257	$	5,373,090
Total long-lived assets	$	58,748	$	16,810	$	12,723	$	88,281

Pre-Tax Depreciation and Amortization by Operating Segment

We recorded the following pre-tax amounts, by operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

	Years Ended December 31,
	2017		2016		2015
Depreciation and amortization of property and equipment:
North America	$	20,241	$	21,952	$	22,239
EMEA		5,025		4,908		3,757
APAC		521		633		653
		25,787		27,493		26,649
Amortization of intangible assets:
North America		15,971		8,139		8,053
EMEA		73		1,951		2,834
APAC		768		547		421
		16,812		10,637		11,308
Total	$	42,599	$	38,130	$	37,957

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Acquisitions (Tables)

12 Months Ended

Feb. 21, 2018

Business Combinations [Abstract]

Summary of Purchase Price and Estimated Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

Total purchase price				$	257,456
Fair value of net assets acquired:
Current assets	$	238,577
Identifiable intangible assets – see description below		94,500
Property and equipment		5,843
Other assets		17,888
Current liabilities		(129,071	)
Long-term liabilities, including deferred taxes		(34,421	)
Total fair value of net assets acquired					193,316
Excess purchase price over fair value of net assets acquired (“goodwill”)				$	64,140

Estimated Useful Lives of Identifiable Intangibles

The identifiable intangibles resulting from the acquisition are amortized using the straight-line method over the following estimated useful lives:

Intangible Assets	Estimated Economic Life
Customer relationships	10 Years
Trade name	1 Year
Non-compete agreements	1 Year

Summary of Pro Forma Information

The following table reports pro forma information as if the acquisition of Datalink had been completed at the beginning of the earliest period presented (in thousands, except per share amounts):

		Year Ended December 31,
		2017		2016		2015
Net sales	As reported	$	6,703,623	$	5,485,515	$	5,373,090
	Proforma	$	6,707,533	$	6,084,484	$	6,033,750
Net earnings	As reported	$	90,683	$	84,690	$	75,851
	Proforma	$	92,276	$	85,823	$	75,696
Diluted earnings per share	As reported	$	2.50	$	2.32	$	1.98
	Proforma	$	2.55	$	2.36	$	1.98

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Selected Quarterly Financial Information (Tables)

12 Months Ended

Feb. 21, 2018

Quarterly Financial Information Disclosure [Abstract]

Consolidated Quarterly Financial Information

The following tables set forth selected unaudited consolidated quarterly financial information for 2017 and 2016 (in thousands, except per share data):

	Quarters Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
Net sales	$	1,784,075		$	1,757,973		$	1,684,032		$	1,477,543
Costs of goods sold		1,551,192			1,531,892			1,432,653			1,269,316
Gross profit		232,883			226,081			251,379			208,227
Operating expenses:
Selling and administrative expenses		184,554			180,390			180,752			177,632
Severance and restructuring expenses		2,791			494			1,022			4,695
Loss on sale of foreign entity		—			3,646			—			—
Acquisition-related expenses		—			106			276			2,947
Earnings from operations		45,538			41,445			69,329			22,953
Non-operating (income) expense:
Interest income		(346	)		(227	)		(205	)		(431	)
Interest expense		5,360			5,555			4,326			3,933
Net foreign currency exchange (gain) loss		(117	)		341			251			380
Other expense, net		367			339			326			315
Earnings before income taxes		40,274			35,437			64,631			18,756
Income tax expense		26,106			13,025			24,376			4,908
Net earnings	$	14,168		$	22,412		$	40,255		$	13,848
Net earnings per share:
Basic	$	0.40		$	0.63		$	1.13		$	0.39
Diluted	$	0.39		$	0.62		$	1.11		$	0.38
Shares used in per share calculations:
Basic		35,809			35,787			35,765			35,602
Diluted		36,272			36,203			36,169			36,185

	Quarters Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016
Net sales	$	1,467,583		$	1,392,716		$	1,456,234		$	1,168,982
Costs of goods sold		1,276,614			1,210,908			1,247,017			1,007,874
Gross profit		190,969			181,808			209,217			161,108
Operating expenses:
Selling and administrative expenses		145,066			143,872			150,186			146,119
Severance and restructuring expenses		1,527			788			909			1,356
Acquisition-related expenses		3,706			741			—			—
Earnings from operations		40,670			36,407			58,122			13,633
Non-operating (income) expense:
Interest income		(282	)		(318	)		(216	)		(250	)
Interest expense		2,271			2,517			1,992			1,848
Net foreign currency exchange (gain) loss		(520	)		579			(153	)		616
Other expense, net		311			352			359			268
Earnings before income taxes		38,890			33,277			56,140			11,151
Income tax expense		17,790			11,642			21,073			4,263
Net earnings	$	21,100		$	21,635		$	35,067		$	6,888
Net earnings per share:
Basic	$	0.59		$	0.61		$	0.96		$	0.19
Diluted	$	0.59		$	0.60		$	0.96		$	0.18
Shares used in per share calculations:
Basic		35,479			35,474			36,380			37,075
Diluted		35,963			35,790			36,612			37,386

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Operations and Summary of Significant Accounting Policies - Additional Information (Detail)					12 Months Ended
	Sep. 26, 2017 USD ($)	Jan. 06, 2017 USD ($)	Sep. 01, 2016 USD ($)	Oct. 01, 2015 USD ($)	Dec. 31, 2017 USD ($) Segment $ / shares shares	Dec. 31, 2016 USD ($) shares	Dec. 31, 2015 USD ($) shares	Jan. 01, 2018 USD ($)
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Number of operating segments | Segment					3
Business acquisition cash purchase price					$ 186,932,000	$ 10,297,000	$ 44,221,000
Partner funding recorded as reduction of selling and administrative expenses					53,227,000	48,114,000	45,146,000
Advertising expense					47,053,000	37,565,000	33,568,000
Accounting Standards Update 2016-09 [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Tax benefit on the settlement of employee share-based awards					$ 2,483,000
Net earning per share, diluted | $ / shares					$ 0.07
Excess tax benefit from employee gains on stock-based compensation reclassified from financing activities to operating activities						$ 323,000	$ 592,000
Retained Earnings [Member] | Maximum [Member] | Subsequent Event [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Cumulative effect adjustment from prior periods								$ 10,000,000
Supplier Risk [Member] | Microsoft [Member] | Purchases [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					26.00%
Supplier Risk [Member] | Significant Supplier [Member] | Purchases [Member] | Maximum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					10.00%
Supplier Risk [Member] | Top Five Suppliers [Member] | Purchases [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					60.00%
Credit Risk [Member] | Net Sales [Member] | Single Customer [Member] | Maximum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					4.00%
US Federal Government [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Percent of sales not exceeded by any single client					9.00%
Restricted Stock Units (RSUs) [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
RSUs excluded from the diluted EPS calculations | shares					40,000	36,000	1,000
Ignia Pty Ltd [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Business acquisition cash purchase price			$ 10,804,000
Business acquisition, effective date of acquisition					Sep. 01, 2016
BlueMetal Architects, Inc. [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Business acquisition cash purchase price				$ 44,221,000
Business acquisition, effective date of acquisition							Oct. 01, 2015
Caase Group, B.V. [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Business acquisition cash purchase price	$ 6,038,000
Datalink [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Business acquisition cash purchase price		$ 257,456,000
Payments to acquire businesses, net of cash and cash equivalents acquired		$ 76,597,000

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Operations and Summary of Significant Accounting Policies - Estimated Economic Lives of Property and Equipment (Detail)	12 Months Ended
	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Leasehold improvements	Shorter of underlying lease term or asset life
Buildings [Member]
Property, Plant and Equipment [Line Items]
Useful Life	29 years
Minimum [Member] | Furniture and fixtures [Member]
Property, Plant and Equipment [Line Items]
Useful Life	2 years
Minimum [Member] | Equipment [Member]
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Minimum [Member] | Software [Member]
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Maximum [Member] | Furniture and fixtures [Member]
Property, Plant and Equipment [Line Items]
Useful Life	7 years
Maximum [Member] | Equipment [Member]
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Maximum [Member] | Software [Member]
Property, Plant and Equipment [Line Items]
Useful Life	10 years

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Operations and Summary of Significant Accounting Policies - Estimated Economic Life of Acquired Amortizable Intangible Assets (Detail)	12 Months Ended
	Dec. 31, 2017
Minimum [Member] | Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	2 years
Minimum [Member] | Tradenames and Restrictive Covenant Agreements [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	9 months
Maximum [Member] | Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	11 years
Maximum [Member] | Tradenames and Restrictive Covenant Agreements [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	3 years

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Operations and Summary of Significant Accounting Policies - Reconciliation of Denominators of Basic and Diluted EPS Calculations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Numerator:
Net earnings	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 21,100	$ 21,635	$ 35,067	$ 6,888	$ 90,683	$ 84,690	$ 75,851
Denominator:
Weighted-average shares used to compute basic EPS	35,809	35,787	35,765	35,602	35,479	35,474	36,380	37,075	35,741	36,102	37,984
Dilutive potential common shares due to dilutive RSUs, net of tax effect									466	336	291
Weighted-average shares used to compute diluted EPS	36,272	36,203	36,169	36,185	35,963	35,790	36,612	37,386	36,207	36,438	38,275
Net earnings per share:
Basic	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 0.59	$ 0.61	$ 0.96	$ 0.19	$ 2.54	$ 2.35	$ 2.00
Diluted	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 0.59	$ 0.60	$ 0.96	$ 0.18	$ 2.50	$ 2.32	$ 1.98

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Property and Equipment - Property and Equipment (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 410,330	$ 379,037
Accumulated depreciation and amortization	(335,078)	(308,127)
Property and equipment, net	75,252	70,910	$ 88,281
Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	171,701	159,442
Buildings [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	65,468	63,253
Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	103,542	93,553
Furniture and fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	38,459	36,526
Leasehold improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	25,981	21,132
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 5,179	$ 5,131

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Property and Equipment - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Abstract]
Non- cash charges to write-off certain property and equipment, primarily computer software development costs	$ 418,000	$ 0	$ 535,000
Depreciation and amortization expense	$ 25,787,000	$ 27,493,000	$ 26,649,000

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Goodwill - Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Goodwill [Line Items]
Beginning Balance	$ 62,645
Goodwill		$ 545,029
Accumulated impairment losses		(488,834)
Goodwill acquired during the year	68,786	6,450
Ending Balance	131,431	62,645
North America Segment [Member]
Goodwill [Line Items]
Beginning Balance	55,688
Goodwill		379,617
Accumulated impairment losses		(323,422)
Goodwill acquired during the year	64,140
Ending Balance	119,828	55,688
Goodwill acquired during 2016		(507)
EMEA Segment [Member]
Goodwill [Line Items]
Goodwill		151,439
Accumulated impairment losses		(151,439)
Goodwill acquired during the year	4,041
Ending Balance	4,041
APAC Segment [Member]
Goodwill [Line Items]
Beginning Balance	6,957
Goodwill		13,973
Accumulated impairment losses		(13,973)
Goodwill acquired during the year	605	6,957
Ending Balance	$ 7,562	$ 6,957

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Goodwill - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Goodwill [Line Items]
Goodwill acquired during the year	$ 68,786,000	$ 6,450,000
EMEA Segment [Member]
Goodwill [Line Items]
Goodwill acquired during the year	$ 4,041,000
Business acquisition, effective date of acquisition	Sep. 26, 2017
North America Segment [Member]
Goodwill [Line Items]
Goodwill acquired during the year	$ 64,140,000
Business acquisition, effective date of acquisition	Jan. 06, 2017
Business acquisition, purchase price allocation reduction in goodwill		507,000
APAC Segment [Member]
Goodwill [Line Items]
Goodwill acquired during the year	$ 605,000	$ 6,957,000
Business acquisition, effective date of acquisition		Sep. 01, 2016
Reduction in goodwill balance due to adjustment in purchase price allocation	$ 35,000
BlueMetal Architects, Inc. [Member]
Goodwill [Line Items]
Goodwill acquired during the year			$ 29,938,000
Business acquisition, effective date of acquisition			Oct. 01, 2015
BlueMetal Architects, Inc. [Member] | North America Segment [Member]
Goodwill [Line Items]
Business acquisition, purchase price allocation reduction in goodwill		$ 507,000

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Intangible Assets - Summary of Intangible Assets, Net (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross	$ 138,135	$ 43,689
Accumulated amortization	(37,357)	(22,982)
Intangible assets, net	100,778	20,707
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross	133,660	41,711
Other [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross	$ 4,475	$ 1,978

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Intangible Assets - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible assets, explanation of significant deletions	The gross intangible assets balance and the accumulated amortization balance were both reduced by approximately $2,516,000	The gross intangible assets balance and the accumulated amortization balance were both reduced by approximately $81,817,000
Reduction in gross intangible assets and accumulated amortization balances	$ 2,516,000	$ 81,817,000
Amortization expense	$ 16,812,000	$ 10,637,000	$ 11,308,000

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Intangible Assets - Future Amortization Expenses (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
2018	$ 14,260
2019	11,690
2020	11,677
2021	11,638
2022	11,638
Thereafter	39,875
Intangible assets, net	$ 100,778	$ 20,707

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Accounts Payable - Inventory Financing Facility - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Accounts Payable And Accrued Expenses [Line Items]
Inventory financing facility maximum borrowing capacity	$ 325,000,000
Inventory financing facility maturity date	Jun. 23, 2021
Imputed interest on inventory financing facility	$ 6,736,000	$ 3,385,000	$ 3,406,000
Inventory financing facility interest rate if balances are not paid within stated vendor terms	Prime plus 1.25%
Inventory financing facility rate if vendor terms not met equal prime plus	1.25%
Maximum [Member]
Accounts Payable And Accrued Expenses [Line Items]
Inventory financing facility additional borrowing capacity	$ 25,000,000

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Debt, Capital Lease and Other Financing Obligations - Long-Term Debt (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Long-term debt
Senior revolving credit facility	$ 117,500
Term Loan A (less unamortized debt issuance costs of $873)	165,377
Accounts receivable securitization financing facility	25,000	$ 39,500
Capital leases and other financing obligations	5,291	1,231
Total	313,168	40,731
Total	313,168	40,731
Less: current portion of long-term debt	(16,592)	(480)
Long-term debt	$ 296,576	$ 40,251

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Debt, Capital Lease and Other Financing Obligations - Long-Term Debt (Parenthetical) (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Debt Disclosure [Abstract]
Unamortized debt issuance cost	$ 873	$ 0

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Debt, Capital Lease and Other Financing Obligations - Additional Information (Detail)		1 Months Ended		12 Months Ended
	Jan. 06, 2017 USD ($)	Aug. 31, 2017	May 31, 2017	Dec. 31, 2017 USD ($) Lessee	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Debt Instrument [Line Items]
Debt outstanding				$ 117,500,000
Accounts receivable securitization financing facility				$ 25,000,000	$ 39,500,000
Capitalized lease term		12-month	36-month terms
Number of capital leases | Lessee				2
Amount owed under other financing agreement				$ 2,489,000	0
ABS Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity				$ 250,000,000
Line of credit maturity date				Jun. 23, 2019
Weighted average amount outstanding borrowings				$ 153,759,000	145,376,000	$ 112,101,000
Debt outstanding				25,000,000
Receivables at fair value				1,141,520,000	$ 936,467,000
Amount of facility permitted by qualified receivables				250,000,000
Accounts receivable securitization financing facility				$ 25,000,000
Credit facility, interest rate at period end				2.41%
Credit facility, usage fee				0.85%
Monthly commitment fee on unused portion of ABS facility				0.375%
Weighted average interest rate				2.40%	1.90%	1.60%
Outstanding borrowings at period end				$ 25,000,000
Senior Revolving Credit Facility Term Loan A and Asset Backed Securitization Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity				$ 766,250,000
Maximum leverage ratio times adjusted earnings				3.50
Senior Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity				$ 350,000,000
Incremental borrowings under Term Loan A	$ 175,000,000
Percentage of amortization payments year one				5.00%
Percentage of amortization payments year two				7.50%
Percentage of amortization payments year three				10.00%
Percentage of amortization payments year four				12.50%
Percentage of amortization payments year five				15.00%
Repayment of borrowing date				Mar. 31, 2021
Line of credit due at maturity				$ 107,187,500
Line of credit maturity date				Jun. 23, 2021
Applicable floating interest rate				3.49%
Weighted average amount outstanding borrowings				$ 63,604,000	$ 35,811,000	$ 21,987,000
Debt outstanding				$ 117,500,000
Credit facility, interest rate at period end				3.49%
Outstanding borrowings at period end				$ 117,500,000
Senior Revolving Credit Facility [Member] | Minimum [Member]
Debt Instrument [Line Items]
Commitment on the unused portion of the facility				0.25%
Participation fee on letter of credit				1.25%
Senior Revolving Credit Facility [Member] | Maximum [Member]
Debt Instrument [Line Items]
Commitment on the unused portion of the facility				0.45%
Participation fee on letter of credit				2.25%
Senior Revolving Credit Facility [Member] | Foreign Currency Borrowings [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity				$ 50,000,000
Senior Revolving Credit Facility [Member] | Prime Rate [Member]
Debt Instrument [Line Items]
Interest rate description				Prime rate plus a predetermined spread of 0.00% to 0.75%
Senior Revolving Credit Facility [Member] | Prime Rate [Member] | Minimum [Member]
Debt Instrument [Line Items]
Pre-determined spread				0.00%
Senior Revolving Credit Facility [Member] | Prime Rate [Member] | Maximum [Member]
Debt Instrument [Line Items]
Pre-determined spread				0.75%
Senior Revolving Credit Facility [Member] | LIBOR Rate [Member]
Debt Instrument [Line Items]
Interest rate description				LIBOR rate plus a pre-determined spread of 1.25% to 2.25%
Senior Revolving Credit Facility [Member] | LIBOR Rate [Member] | Minimum [Member]
Debt Instrument [Line Items]
Pre-determined spread				1.25%
Senior Revolving Credit Facility [Member] | LIBOR Rate [Member] | Maximum [Member]
Debt Instrument [Line Items]
Pre-determined spread				2.25%
Term Loan A [Member]
Debt Instrument [Line Items]
Applicable floating interest rate				3.57%
Debt outstanding				$ 166,250,000
Credit facility, interest rate at period end				3.57%
Outstanding borrowings at period end				$ 166,250,000
Senior Revolving Credit Facility and Term Loan A [Member]
Debt Instrument [Line Items]
Interest expense				$ 8,491,000	$ 2,191,000	$ 1,813,000

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Debt, Capital Lease and Other Financing Obligations - Schedule of Future Minimum Lease Payments for Capital Leases (Detail)	Dec. 31, 2017 USD ($)
Capital Lease Obligations [Abstract]
2018	$ 1,550
2019	1,016
2020	381
Total minimum lease payments	2,947
Less amount representing interest	(145)
Present value of minimum lease payments	$ 2,802

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Operating Leases - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Leases [Abstract]
Operating leases rental expense	$ 19,126,000	$ 14,444,000	$ 14,737,000
Non-cancellable rental income, 2018	1,600,000
Non-cancellable rental income, 2019	$ 1,600,000

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Operating Leases - Future Minimum Lease Payment (Detail) $ in Thousands	Dec. 31, 2017 USD ($)
Leases [Abstract]
2018	$ 18,601
2019	16,617
2020	12,122
2021	9,170
2022	6,966
Thereafter	12,023
Total minimum lease payments	$ 75,499

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Severance and Restructuring Activities - Activity Related to Resource Actions and Outstanding Obligations (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Restructuring Cost and Reserve [Line Items]
Beginning balance	$ 2,164	$ 3,488	$ 3,828
Severance costs, net of adjustments	9,002	4,580	4,907
Cash payments	(7,022)	(5,881)	(4,990)
Foreign currency translation adjustments	496	(23)	(257)
Ending balance	4,640	2,164	3,488
North America Segment [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance	947	505	857
Severance costs, net of adjustments	4,010	2,966	1,126
Cash payments	(3,336)	(2,524)	(1,456)
Foreign currency translation adjustments	10		(22)
Ending balance	1,631	947	505
EMEA Segment [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance	1,217	2,983	2,971
Severance costs, net of adjustments	4,888	1,496	3,781
Cash payments	(3,597)	(3,239)	(3,534)
Foreign currency translation adjustments	486	(23)	(235)
Ending balance	2,994	1,217	$ 2,983
APAC Segment [Member]
Restructuring Cost and Reserve [Line Items]
Severance costs, net of adjustments	104	118
Cash payments	(89)	$ (118)
Ending balance	$ 15

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Stock-Based Compensation - Pre-tax Amounts by Operating Segment for Stock-Based Compensation (Detail) - Restricted Stock Units (RSUs) [Member] - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	$ 12,826	$ 11,058	$ 8,922
Selling and Administrative Expenses [Member] | North America Segment [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	9,697	8,096	6,648
Selling and Administrative Expenses [Member] | EMEA Segment [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	2,737	2,530	1,908
Selling and Administrative Expenses [Member] | APAC Segment [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	$ 392	$ 432	$ 366

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Stock-Based Compensation - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Description of share based compensation under Amended 2007 Omnibus Plan	Our Board of Directors adopted the Amended Insight Enterprises, Inc. 2007 Omnibus Plan (the "Plan") on March 28, 2011.
Maximum number of authorized shares	7,250,000
Number of shares of stock available for grant	3,215,540
Payments for teammates' tax obligations to taxing authorities	$ 5,318,000	$ 2,219,000	$ 2,265,000
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total compensation cost related to RSU's not yet recognized	$ 17,483,000
Weighted average number of years for recognition of outstanding nonvested RSUs	1 year 2 months 30 days
Shares withheld to cover taxes	122,255	84,953	85,652
Payments for teammates' tax obligations to taxing authorities	$ 5,318,000	$ 2,219,000	$ 2,265,000

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Stock-Based Compensation - Summary of Restricted Stock Units Activity (Detail) - Restricted Stock Units (RSUs) [Member] - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested Number, Beginning balance	1,067,557
Number, Granted	369,438
Number, Vested, including shares withheld to cover taxes	(466,839)
Number, Forfeited	(78,043)
Nonvested Number, Ending balance	892,113	1,067,557
Nonvested Weighted Average Grant Date Fair Value, Beginning balance	$ 25.37
Weighted Average Grant Date Fair Value, Granted	44.12
Weighted Average Grant Date Fair Value, Vested, including shares withheld to cover taxes	24.88
Weighted Average Grant Date Fair Value, Forfeited	32.16
Nonvested Weighted Average Grant Date Fair Value, Ending balance	$ 32.86	$ 25.37
Fair Value, Vested, including shares withheld to cover taxes	$ 20,284,762	$ 9,235,102	$ 9,168,784
Fair Value, Nonvested at end of period	$ 34,159,007

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Stock-Based Compensation - Summary of Restricted Stock Units Activity (Parenthetical) (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 29, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Closing stock price				$ 38.29
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value for vested shares of RSUs	$ 20,284,762	$ 9,235,102	$ 9,168,784

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Assets Held for Sale - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2016 USD ($)
Long Lived Assets Held-for-sale [Line Items]
Gain on sale of real estate	$ 338,000
Selling and Administrative Expenses [Member]
Long Lived Assets Held-for-sale [Line Items]
Gain on sale of real estate	$ 338,000

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Income Taxes - Earnings Before Income Taxes (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure [Abstract]
United States									$ 119,330	$ 99,095	$ 90,575
Foreign									39,768	40,363	28,601
Earnings before income taxes	$ 40,274	$ 35,437	$ 64,631	$ 18,756	$ 38,890	$ 33,277	$ 56,140	$ 11,151	$ 159,098	$ 139,458	$ 119,176

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Income Taxes - Income Tax Expense (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Current:
U.S. Federal									$ 31,067	$ 27,947	$ 24,369
U.S. State and local									3,636	2,200	2,705
Foreign									14,573	14,104	11,077
Total current income tax expense									49,276	44,251	38,151
Deferred:
U.S. Federal									20,327	10,395	5,104
U.S. State and local									(427)	1,088	602
Foreign									(761)	(966)	(532)
Total deferred income tax expense									19,139	10,517	5,174
Income tax expense	$ 26,106	$ 13,025	$ 24,376	$ 4,908	$ 17,790	$ 11,642	$ 21,073	$ 4,263	$ 68,415	$ 54,768	$ 43,325

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Income Taxes - Schedule Reconciles Difference between U.S. Federal Income Taxes at U.S. Statutory Rate and Our Income Tax Expense (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Effective Income Tax Rate Reconciliation, Amount [Abstract]
Statutory federal income tax rate, Amount									$ 55,684	$ 48,810	$ 41,712
State income tax expense, net of federal income tax benefit									2,808	3,368	3,180
Audits and adjustments, net									(313)	(1,039)	(886)
Change in valuation allowances									2,472	3,742	2,944
Foreign income taxed at different rates									(6,057)	(6,611)	(5,729)
U.S. mandatory deemed repatriation									5,625
Adjustment of net deferred tax assets for enacted U.S. federal tax reform									7,738
Change in U.S. tax law applicable to certain foreign entities										2,577
Non-deductible compensation									571	518	474
Other, net									(113)	3,403	1,630
Income tax expense	$ 26,106	$ 13,025	$ 24,376	$ 4,908	$ 17,790	$ 11,642	$ 21,073	$ 4,263	$ 68,415	$ 54,768	$ 43,325
Statutory federal income tax rate									35.00%	35.00%	35.00%
State income tax expense, net of federal income tax benefit, Rate									1.80%	2.40%	2.70%
Audits and adjustments, net, Rate									(0.20%)	(0.70%)	(0.70%)
Change in valuation allowances, Rate									1.50%	2.70%	2.50%
Foreign income taxed at different rates, Rate									(3.80%)	(4.70%)	(4.80%)
U.S. mandatory deemed repatriation, Rate									3.50%
Adjustment of net deferred tax assets for enacted U.S. federal tax reform, Rate									4.90%
Change in U.S. tax law applicable to certain foreign entities, Rate										1.80%
Non-deductible compensation, Rate									0.40%	0.40%	0.40%
Other, net, Rate									(0.10%)	2.40%	1.30%
Effective tax rate									43.00%	39.30%	36.40%

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Income Taxes - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax [Line Items]
Statutory federal income tax rate		35.00%	35.00%	35.00%
Income tax expense in connection with enactment of U.S. Tax Cuts and Jobs Act		$ 13,363,000
Non-deductible acquisition-related expenses		349,000	$ 1,296,000
Valuation allowances		45,995,000	30,972,000	$ 28,750,000
Unrecognized tax benefits		4,273,000	2,246,000
Unrecognized tax benefits, interest on income taxes accrued		$ 287,000	$ 195,000
Period during which examination phase of tax audits may conclude, description		Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months which could significantly increase or decrease the balance of our gross unrecognized tax benefits.
Period during which federal income tax returns remain open to examination		2014, 2015, 2016 and 2017
Statute of limitations for tax examination, Minimum		3 years
Statute of limitations for tax examination, Maximum		10 years
Scenario, Forecast [Member]
Income Tax [Line Items]
Statutory federal income tax rate	21.00%
Earliest Tax Year [Member]
Income Tax [Line Items]
Open tax year		2012
Latest Tax Year [Member]
Income Tax [Line Items]
Open tax year		2015
State and Local Jurisdictions [Member]
Income Tax [Line Items]
Net operating loss carry forward		$ 1,977,000
Foreign [Member]
Income Tax [Line Items]
Net operating loss carry forward		87,056,000
Operating loss carryforward, which will expire		$ 6,258,000
Operating loss expiration year		2018
Operating loss expiration year		2024
United States [Member]
Income Tax [Line Items]
Net operating loss carry forward		$ 1,455,000
Operating loss expiration year		2018
Operating loss expiration year		2036

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Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Deferred tax assets:
Net operating losses	$ 25,418	$ 18,964
Foreign tax credits	21,346	13,115
Accruals	5,921	6,426
Goodwill and other intangibles	4,717	35,523
Stock-based compensation	3,023	4,238
Accounts receivable	2,124	2,547
Inventories	1,930	2,598
Property and equipment	1,111	705
Deferred revenue	600	468
Other	335	55
Gross deferred tax assets	66,525	84,639
Valuation allowances	(45,995)	(30,972)	$ (28,750)
Total deferred tax assets	20,530	53,667
Deferred tax liabilities:
Goodwill and other intangibles	(1,587)	(1,221)
Accrued withholding tax	(1,452)
Prepaid expenses	(369)	(204)
Other	(775)	(795)
Total deferred tax liabilities	(4,183)	(2,220)
Net deferred tax assets	$ 16,347	$ 51,447

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Income Taxes - Net Non-Current Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Income Tax Disclosure [Abstract]
Net non-current deferred tax assets	$ 17,064	$ 52,347
Net non-current deferred tax liabilities	(717)	(900)
Net deferred tax assets	$ 16,347	$ 51,447

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Income Taxes - Change in Valuation Allowance (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Valuation allowances at beginning of year	$ 30,972	$ 28,750
Increase in income tax expense	2,472	3,742	$ 2,944
U.S. federal tax reform	11,623
Foreign currency translation adjustments	2,865	(1,035)
Other	(1,937)	(485)
Valuation allowances at end of year	$ 45,995	$ 30,972	$ 28,750

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Income Taxes - Reconciliation of Unrecognized Tax Benefits (Detail) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($)
Income Tax Disclosure [Abstract]
Beginning Balance	$ 2,051
Additions for tax positions added through acquisition	2,484
Subtractions for tax positions in prior periods	(59)
Additions for tax positions in current period	867
Additions due to foreign currency translation	53
Subtractions due to audit settlements and statute expirations	(1,410)
Ending Balance	$ 3,986

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Market Risk Management - Additional Information (Detail)	Dec. 31, 2017 USD ($)
Line of Credit Facility [Line Items]
Debt outstanding	$ 117,500,000
Senior Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Debt outstanding	$ 117,500,000
Interest rate	3.49%
Term Loan A [Member]
Line of Credit Facility [Line Items]
Debt outstanding	$ 166,250,000
Interest rate	3.57%
ABS Facility [Member]
Line of Credit Facility [Line Items]
Debt outstanding	$ 25,000,000
Interest rate	2.41%

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Derivative Financial Instruments - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2017 USD ($) DerivativeInstrument	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Foreign Currency Derivatives [Abstract]
Foreign currency forward contracts, maturity	1 month
Approximate number of foreign exchange forward contracts per month | DerivativeInstrument	4
Average notional value of foreign exchange forward contracts	$ 10,610,000
Average maturity of foreign exchange forward contracts	9 days
Amount of gain (loss) recognized in earnings on derivatives	$ 159,000	$ (2,722,000)	$ (942,000)

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Benefit Plans - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Compensation Related Costs [Abstract]
Discretionary match contribution to defined contribution plan provided to participants-U.S. teammates	50.00%
Maximum pre-tax contributions of compensation per pay period eligible for match- U.S. teammates	6.00%
Contribution expense	$ 14,083,000	$ 7,684,000	$ 7,190,000

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Share Repurchase Programs - Additional Information (Detail) - USD ($)	Feb. 13, 2018	Dec. 31, 2017	Feb. 29, 2016	Feb. 28, 2015	Oct. 31, 2014
Schedule Of Share Repurchase Programs [Line Items]
Common stock repurchase program, authorized amount		$ 0	$ 50,000,000	$ 75,000,000	$ 25,000,000
Subsequent Event [Member]
Schedule Of Share Repurchase Programs [Line Items]
Common stock repurchase program, authorized amount	$ 50,000,000

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Share Repurchase Programs - Summary of Shares of Common Stock Repurchased Under Repurchase Programs (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended		36 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2017
Equity [Abstract]
Repurchase program, total number of shares purchased	1,891	3,300	5,191
Repurchase program, average price paid per share	$ 26.43	$ 27.83
Repurchase program, approximate dollar value of shares purchased	$ 50,000	$ 91,843	$ 141,843

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Commitments and Contingencies - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2017 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Other commitment, Performance bonds outstanding	$ 1,962,000
Number of months of salary paid as severance	From three to twenty-four months

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Supplemental Financial Information - Summary of Additions and Deductions Related to Allowances for Doubtful Accounts (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Quarterly Financial Information Disclosure [Abstract]
Allowance for doubtful accounts receivable, Beginning Balance	$ 9,138	$ 11,872	$ 19,336
Allowance for doubtful accounts receivable, Additions	5,245	2,452	6,761
Allowance for doubtful accounts receivable, Deductions	(4,225)	(5,186)	(14,225)
Allowance for doubtful accounts receivable, Ending Balance	$ 10,158	$ 9,138	$ 11,872

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Supplemental Financial Information - Additional Information (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Quarterly Financial Information Disclosure [Abstract]
Reduction of the allowance for doubtful accounts	$ 10,158	$ 9,138	$ 11,872	$ 19,336

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Cash Flows - Schedule of Cash Payments for Interest on Indebtedness and Cash Payments for Taxes on Income (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$ 10,976	$ 3,782	$ 2,866
Cash paid during the year for income taxes, net of refunds	$ 55,470	$ 39,051	$ 41,062

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Cash Flows - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Supplemental Cash Flow Elements [Abstract]
Capital expenditures in accounts payable, purchased at period end but not yet paid	$ 159,000	$ 791,000	$ 662,000

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Segment and Geographic Information - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2017 Segment	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Revenue from External Customer [Line Items]
Number of operating segments | Segment	3
Description of major customers net sales	None of our clients exceeded ten percent of consolidated net sales in 2017, 2016 or 2015.
Product Concentration Risk [Member] | Net Sales [Member]
Revenue from External Customer [Line Items]
Net sales from provision of services	10.00%
APAC Segment [Member] | Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Reclassified to services		$ 9,000	$ 6,000
APAC Segment [Member] | Software Net Sales [Member]
Revenue from External Customer [Line Items]
Reclassified to services		10,991,000	8,439,000
EMEA Segment [Member] | Software Net Sales [Member]
Revenue from External Customer [Line Items]
Reclassified to services		48,586,000	43,388,000
North America Segment [Member] | Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Reclassified to services		270,000	24,000
North America Segment [Member] | Software Net Sales [Member]
Revenue from External Customer [Line Items]
Reclassified to services		$ 87,984,000	$ 74,101,000

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Segment and Geographic Information - Net Sales by Offering for North America, EMEA and APAC (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenue from External Customer [Line Items]
Revenues from external customers	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	$ 6,703,623	$ 5,485,515	$ 5,373,090
North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									5,181,734	3,971,828	3,823,528
North America Segment [Member] | Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									3,352,355	2,454,889	2,336,764
North America Segment [Member] | Software Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									1,310,118	1,146,808	1,157,168
North America Segment [Member] | Services Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									519,261	370,131	329,596
EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									1,355,416	1,338,560	1,371,137
EMEA Segment [Member] | Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									536,500	481,505	531,308
EMEA Segment [Member] | Software Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									710,452	762,427	756,373
EMEA Segment [Member] | Services Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									108,464	94,628	83,456
APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									166,473	175,127	178,425
APAC Segment [Member] | Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									27,907	18,916	14,327
APAC Segment [Member] | Software Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									101,412	132,718	149,607
APAC Segment [Member] | Services Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									$ 37,154	$ 23,493	$ 14,491

XML

Segment and Geographic Information - Financial Information about Reportable Operating Segments (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Segment Reporting Information [Line Items]
Total assets	$ 2,685,651				$ 2,219,300				$ 2,685,651	$ 2,219,300
Products									6,038,744	4,997,263	$ 4,945,547
Services									664,879	488,252	427,543
Total net sales	1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	6,703,623	5,485,515	5,373,090
Products									5,512,402	4,571,462	4,513,353
Services									272,651	170,951	143,405
Total costs of goods sold	1,551,192	1,531,892	1,432,653	1,269,316	1,276,614	1,210,908	1,247,017	1,007,874	5,785,053	4,742,413	4,656,758
Gross profit	232,883	226,081	251,379	208,227	190,969	181,808	209,217	161,108	918,570	743,102	716,332
Operating expenses:
Selling and administrative expenses	184,554	180,390	180,752	177,632	145,066	143,872	150,186	146,119	723,328	585,243	584,906
Severance and restructuring expenses	2,791	494	1,022	4,695	1,527	788	909	1,356	9,002	4,580	4,907
Loss on sale of foreign entity		3,646							3,646
Acquisition-related expenses		106	276	2,947	3,706	741			3,329	4,447
Earnings from operations	45,538	$ 41,445	$ 69,329	$ 22,953	40,670	$ 36,407	$ 58,122	$ 13,633	179,265	148,832	126,519
North America Segment [Member]
Segment Reporting Information [Line Items]
Products									4,662,473	3,601,697	3,493,932
Services									519,261	370,131	329,596
Total net sales									5,181,734	3,971,828	3,823,528
Products									4,253,587	3,301,148	3,196,297
Services									236,470	145,199	125,668
Total costs of goods sold									4,490,057	3,446,347	3,321,965
Gross profit									691,677	525,481	501,563
Operating expenses:
Selling and administrative expenses									530,792	401,316	396,603
Severance and restructuring expenses									4,010	2,966	1,126
Acquisition-related expenses									3,223	4,278
Earnings from operations									153,652	116,921	103,834
EMEA Segment [Member]
Segment Reporting Information [Line Items]
Products									1,246,952	1,243,932	1,287,681
Services									108,464	94,628	83,456
Total net sales									1,355,416	1,338,560	1,371,137
Products									1,140,204	1,129,917	1,167,113
Services									24,902	22,956	17,737
Total costs of goods sold									1,165,106	1,152,873	1,184,850
Gross profit									190,310	185,687	186,287
Operating expenses:
Selling and administrative expenses									164,305	160,269	165,879
Severance and restructuring expenses									4,888	1,496	3,781
Loss on sale of foreign entity									3,646
Acquisition-related expenses									106
Earnings from operations									17,365	23,922	16,627
APAC Segment [Member]
Segment Reporting Information [Line Items]
Products									129,319	151,634	163,934
Services									37,154	23,493	14,491
Total net sales									166,473	175,127	178,425
Products									118,611	140,397	149,943
Services									11,279	2,796
Total costs of goods sold									129,890	143,193	149,943
Gross profit									36,583	31,934	28,482
Operating expenses:
Selling and administrative expenses									28,231	23,658	22,424
Severance and restructuring expenses									104	118
Acquisition-related expenses										169
Earnings from operations									8,248	7,989	6,058
Operating Segments [Member]
Segment Reporting Information [Line Items]
Total assets	2,968,984				2,886,422				2,968,984	2,886,422	2,657,604
Operating Segments [Member] | North America Segment [Member]
Segment Reporting Information [Line Items]
Total assets	2,337,573				2,204,351				2,337,573	2,204,351	1,999,485
Operating Segments [Member] | EMEA Segment [Member]
Segment Reporting Information [Line Items]
Total assets	530,242				562,293				530,242	562,293	543,146
Operating Segments [Member] | APAC Segment [Member]
Segment Reporting Information [Line Items]
Total assets	$ 101,169				$ 119,778				$ 101,169	$ 119,778	$ 114,973

XML

Segment and Geographic Information - Financial Information about Reportable Operating Segments (Parenthetical) (Detail) - USD ($)	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Segment Reporting Information [Line Items]
Total assets	$ 2,685,651,000	$ 2,219,300,000
Eliminations, Corporate and Reconciling Items [Member]
Segment Reporting Information [Line Items]
Total assets	$ 283,333,000	$ 667,122,000	$ 643,587,000

XML

Segment and Geographic Information - Summary of Geographic Net Sales and Long-Lived Assets (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	$ 6,703,623	$ 5,485,515	$ 5,373,090
Total long-lived assets	75,252				70,910				75,252	70,910	88,281
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales									4,933,805	3,776,352	3,645,876
Total long-lived assets	50,462				46,774				50,462	46,774	58,748
United Kingdom [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales									684,632	671,999	711,957
Total long-lived assets	14,783				13,570				14,783	13,570	16,810
Other Foreign [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales									1,085,186	1,037,164	1,015,257
Total long-lived assets	$ 10,007				$ 10,566				$ 10,007	$ 10,566	$ 12,723

XML

Segment and Geographic Information - Pre-Tax Depreciation and Amortization by Operating Segment (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	$ 25,787	$ 27,493	$ 26,649
Amortization of intangible assets	16,812	10,637	11,308
Depreciation and amortization, total	42,599	38,130	37,957
North America Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	20,241	21,952	22,239
Amortization of intangible assets	15,971	8,139	8,053
EMEA Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	5,025	4,908	3,757
Amortization of intangible assets	73	1,951	2,834
APAC Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	521	633	653
Amortization of intangible assets	$ 768	$ 547	$ 421

XML

Acquisitions - Additional Information (Detail) - USD ($)					3 Months Ended			12 Months Ended
	Sep. 26, 2017	Jan. 06, 2017	Sep. 01, 2016	Oct. 01, 2015	Dec. 31, 2017	Jun. 30, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Business Acquisition [Line Items]
Business acquisition cash purchase price								$ 186,932,000	$ 10,297,000	$ 44,221,000
Goodwill					$ 131,431,000		$ 62,645,000	131,431,000	62,645,000
Amortization expense								16,812,000	10,637,000	11,308,000
Reduction in goodwill balance due to adjustment in purchase price allocation						$ 945,000		0
Goodwill recorded in acquisition								68,786,000	6,450,000
North America Segment [Member]
Business Acquisition [Line Items]
Goodwill					119,828,000		55,688,000	119,828,000	55,688,000
Amortization expense								$ 15,971,000	8,139,000	8,053,000
Business acquisition, effective date of acquisition								Jan. 06, 2017
Goodwill recorded in acquisition								$ 64,140,000
Acquisitions purchase price adjustment									507,000
APAC Segment [Member]
Business Acquisition [Line Items]
Goodwill					7,562,000		6,957,000	7,562,000	6,957,000
Amortization expense								768,000	$ 547,000	421,000
Business acquisition, effective date of acquisition									Sep. 01, 2016
Working capital adjustment								35,000
Goodwill recorded in acquisition								605,000	$ 6,957,000
EMEA Segment [Member]
Business Acquisition [Line Items]
Goodwill					4,041,000			4,041,000
Amortization expense								$ 73,000	1,951,000	$ 2,834,000
Business acquisition, effective date of acquisition								Sep. 26, 2017
Goodwill recorded in acquisition								$ 4,041,000
Caase Group, B.V. [Member]
Business Acquisition [Line Items]
Business acquisition cash purchase price	$ 6,038,000
Caase Group, B.V. [Member] | EMEA Segment [Member]
Business Acquisition [Line Items]
Business acquisition cash purchase price	6,038,000
Net assets acquired	2,107,000
Cash acquired	68,000
Acquired identifiable intangible assets	2,039,000
Decrease in fair value of acquired identifiable intangible assets					193,000
Goodwill					$ 4,041,000			4,041,000
Caase Group, B.V. [Member] | EMEA Segment [Member] | Scenario, Previously Reported [Member]
Business Acquisition [Line Items]
Goodwill	$ 4,117,000
Caase Group, B.V. [Member] | Customer Relationships [Member] | EMEA Segment [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets	8 years
Caase Group, B.V. [Member] | Trade Name [Member] | EMEA Segment [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets	8 years
Caase Group, B.V. [Member] | Non-compete Agreements [Member] | EMEA Segment [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets	8 years
Datalink [Member]
Business Acquisition [Line Items]
Business acquisition cash purchase price		$ 257,456,000
Cash acquired		76,597,000
Goodwill		64,140,000
Estimated fair value of deferred revenue		65,500,000
Estimated fair value of deferred costs		48,029,000
Identified intangible assets		94,500,000
Amortization expense								11,520,000
Business combination, net sales from acquired entity								524,281,000
Business combination, gross profit from acquired entity								$ 118,917,000
Datalink [Member] | North America Segment [Member]
Business Acquisition [Line Items]
Goodwill		64,140,000
Datalink [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Identified intangible assets		92,200,000
Datalink [Member] | Trade Name [Member]
Business Acquisition [Line Items]
Identified intangible assets		2,200,000
Datalink [Member] | Non-compete Agreements [Member]
Business Acquisition [Line Items]
Identified intangible assets		$ 100,000
Ignia Pty Ltd [Member]
Business Acquisition [Line Items]
Business acquisition cash purchase price			$ 10,804,000
Business acquisition, effective date of acquisition								Sep. 01, 2016
Ignia Pty Ltd [Member] | APAC Segment [Member]
Business Acquisition [Line Items]
Business acquisition cash purchase price			10,804,000
Net assets acquired			5,324,000
Cash acquired			1,463,000
Acquired identifiable intangible assets			4,716,000
Decrease in fair value of acquired identifiable intangible assets							218,000
Goodwill							$ 6,957,000		6,957,000
Business acquisition, effective date of acquisition								Sep. 01, 2016
Working capital adjustment						$ 35,000
Ignia Pty Ltd [Member] | APAC Segment [Member] | Scenario, Previously Reported [Member]
Business Acquisition [Line Items]
Goodwill			$ 7,248,000
Ignia Pty Ltd [Member] | Customer Relationships [Member] | APAC Segment [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets			8 years
Ignia Pty Ltd [Member] | Restrictive Covenant Agreements [Member] | APAC Segment [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets			27 months
BlueMetal Architects, Inc. [Member]
Business Acquisition [Line Items]
Business acquisition cash purchase price				$ 44,221,000
Net assets acquired				15,412,000
Acquired identifiable intangible assets				15,240,000
Business acquisition, effective date of acquisition										Oct. 01, 2015
Goodwill recorded in acquisition										$ 29,938,000
Tax deductible goodwill				$ 0
BlueMetal Architects, Inc. [Member] | North America Segment [Member]
Business Acquisition [Line Items]
Acquisitions purchase price adjustment									$ 507,000
BlueMetal Architects, Inc. [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets				8 years
BlueMetal Architects, Inc. [Member] | Restrictive Covenant Agreements [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets				3 years

XML

Acquisitions - Summary of Purchase Price and Estimated Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands		12 Months Ended
	Jan. 06, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Business Acquisition [Line Items]
Total purchase price		$ 186,932	$ 10,297	$ 44,221
Fair value of net assets acquired:
Excess purchase price over fair value of net assets acquired ("goodwill")		$ 131,431	$ 62,645
Datalink [Member]
Business Acquisition [Line Items]
Total purchase price	$ 257,456
Fair value of net assets acquired:
Current assets	238,577
Identifiable intangible assets - see description below	94,500
Property and equipment	5,843
Other assets	17,888
Current liabilities	(129,071)
Long-term liabilities, including deferred taxes	(34,421)
Total fair value of net assets acquired	193,316
Excess purchase price over fair value of net assets acquired ("goodwill")	$ 64,140

XML

Acquisitions - Estimated Useful Lives of Identifiable Intangibles (Detail) - Datalink [Member]	12 Months Ended
	Dec. 31, 2017
Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	10 years
Trade Name [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	1 year
Non-compete Agreements [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Useful Life	1 year

XML

Acquisitions - Summary of Pro Forma Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Business Acquisition [Line Items]
Net sales, As reported	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	$ 6,703,623	$ 5,485,515	$ 5,373,090
Net earnings, As reported	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 21,100	$ 21,635	$ 35,067	$ 6,888	$ 90,683	$ 84,690	$ 75,851
Diluted earnings per share, As reported	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 0.59	$ 0.60	$ 0.96	$ 0.18	$ 2.50	$ 2.32	$ 1.98
Datalink [Member]
Business Acquisition [Line Items]
Net sales, As reported									$ 6,703,623	$ 5,485,515	$ 5,373,090
Net sales, Proforma									6,707,533	6,084,484	6,033,750
Net earnings, As reported									90,683	84,690	75,851
Net earnings, Proforma									$ 92,276	$ 85,823	$ 75,696
Diluted earnings per share, As reported									$ 2.50	$ 2.32	$ 1.98
Diluted earnings per share, Proforma									$ 2.55	$ 2.36	$ 1.98

XML

Sale of Foreign Entity - Additional Information (Detail) - USD ($)	3 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2017
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on sale of foreign entity	$ 3,646,000	$ 3,646,000
Discontinued Operations, Disposed of by Sale [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on sale of foreign entity	3,646,000
Charge upon release of cumulative translation adjustment	$ 2,903,000

XML

Selected Quarterly Financial Information - Consolidated Quarterly Financial Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Quarterly Financial Information Disclosure [Abstract]
Net sales	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	$ 6,703,623	$ 5,485,515	$ 5,373,090
Costs of goods sold	1,551,192	1,531,892	1,432,653	1,269,316	1,276,614	1,210,908	1,247,017	1,007,874	5,785,053	4,742,413	4,656,758
Gross profit	232,883	226,081	251,379	208,227	190,969	181,808	209,217	161,108	918,570	743,102	716,332
Operating expenses:
Selling and administrative expenses	184,554	180,390	180,752	177,632	145,066	143,872	150,186	146,119	723,328	585,243	584,906
Severance and restructuring expenses	2,791	494	1,022	4,695	1,527	788	909	1,356	9,002	4,580	4,907
Loss on sale of foreign entity		3,646							3,646
Acquisition-related expenses		106	276	2,947	3,706	741			3,329	4,447
Earnings from operations	45,538	41,445	69,329	22,953	40,670	36,407	58,122	13,633	179,265	148,832	126,519
Non-operating (income) expense:
Interest income	(346)	(227)	(205)	(431)	(282)	(318)	(216)	(250)	(1,209)	(1,066)	(783)
Interest expense	5,360	5,555	4,326	3,933	2,271	2,517	1,992	1,848	19,174	8,628	7,224
Net foreign currency exchange (gain) loss	(117)	341	251	380	(520)	579	(153)	616	855	522	(393)
Other expense, net	367	339	326	315	311	352	359	268	1,347	1,290	1,295
Earnings before income taxes	40,274	35,437	64,631	18,756	38,890	33,277	56,140	11,151	159,098	139,458	119,176
Income tax expense	26,106	13,025	24,376	4,908	17,790	11,642	21,073	4,263	68,415	54,768	43,325
Net earnings	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 21,100	$ 21,635	$ 35,067	$ 6,888	$ 90,683	$ 84,690	$ 75,851
Net earnings per share:
Basic	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 0.59	$ 0.61	$ 0.96	$ 0.19	$ 2.54	$ 2.35	$ 2.00
Diluted	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 0.59	$ 0.60	$ 0.96	$ 0.18	$ 2.50	$ 2.32	$ 1.98
Shares used in per share calculations:
Net sales	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 1,467,583	$ 1,392,716	$ 1,456,234	$ 1,168,982	$ 6,703,623	$ 5,485,515	$ 5,373,090
Costs of goods sold	1,551,192	1,531,892	1,432,653	1,269,316	1,276,614	1,210,908	1,247,017	1,007,874	5,785,053	4,742,413	4,656,758
Gross profit	$ 232,883	$ 226,081	$ 251,379	$ 208,227	$ 190,969	$ 181,808	$ 209,217	$ 161,108	$ 918,570	$ 743,102	$ 716,332
Basic	35,809	35,787	35,765	35,602	35,479	35,474	36,380	37,075	35,741	36,102	37,984
Diluted	36,272	36,203	36,169	36,185	35,963	35,790	36,612	37,386	36,207	36,438	38,275