10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

/ X/ Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2018

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 X 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 X

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 X No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 submit such files). 

Yes X 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.  /X/

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	X	Accelerated filer	Non-accelerated filer
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 X

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 29, 2018, the last business day of the registrant’s most recently completed second fiscal quarter, was $1,710,394,927.

The number of shares outstanding of the registrant’s common stock on February 15, 2019 was 35,502,671.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Proxy Statement relating to its 2019 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. 

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ANNUAL REPORT ON FORM 10-K

Year Ended December 31, 2018

TABLE OF CONTENTS

		Page
PART I
ITEM 1.	Business	3
ITEM 1A.	Risk Factors	12
ITEM 1B.	Unresolved Staff Comments	19
ITEM 2.	Properties	19
ITEM 3.	Legal Proceedings	20
ITEM 4.	Mine Safety Disclosures	20
PART II
ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20
ITEM 6.	Selected Financial Data	22
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk	44
ITEM 8.	Financial Statements and Supplementary Data	45
ITEM 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	93
ITEM 9A.	Controls and Procedures	93
ITEM 9B.	Other Information	93
PART III
ITEM 10.	Directors, Executive Officers and Corporate Governance	94
ITEM 11.	Executive Compensation	94
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	94
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	94
ITEM 14.	Principal Accounting Fees and Services	94
PART IV
ITEM 15.	Exhibits, Financial Statement Schedules	95
ITEM 16.	Form 10-K Summary	95
EXHIBITS TO FORM 10-K		96
SIGNATURES		101

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 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;

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• 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

Today, every business is a technology business.  Insight Enterprises, Inc. (“Insight” or the “Company”) empowers organizations of all sizes with Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter.    

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

Operating Segment*	Geography	Percent of 2018 Consolidated Net Sales
North America	United States and Canada	76%
EMEA	Europe, Middle East and Africa	21%
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 19 to the Consolidated Financial Statements in Part II, Item 8 of this report.  

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 majoracquisitions 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 digital innovation solutions to our clients in APAC;

• 2017 – Acquired Datalink Corporation (“Datalink”) 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.  Additionally, we acquired Caase Group B.V. (referred to herein as, “Caase.com”) and strengthened our ability to deliver cloud and data center solutions to our clients in EMEA; and

• 2018 – On August 1, 2018, we acquired Cardinal Solutions Group, Inc. (“Cardinal”), a digital solutions provider and strengthened our digital innovations capabilities.

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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 $3.8 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 $652 billion in annual sales and for the year ended December 31, 2018, our net sales of $7.1 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 19 countries and our deep experience delivering IT hardware, software and services 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 product and services needs and help our clients define, architect, implement and manage their IT solutions.

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

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 products with access to billions of dollars in virtual inventory and efficient supply chain execution, as well as product fulfillment, logistics capabilities, management tools and technical expertise.

• 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.

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• Our data center transformation skills– in support of our long-term strategy, we acquired Datalink (2017 U.S.) and Caase (2017 Netherlands) providers of IT services, cloud and enterprise data center solutions, adding additional 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, investing internally to advance our technical capabilities while at the same time making strategic acquisitions that establish us as thought leaders, with scale and reach, around emerging market trends. The Blue Metal (2015, U.S.), Ignia (2016, Australia) and Cardinal (2018, U.S.) acquisitions are examples of acquisitions that have given us global capabilities to support our clients as they look to accelerate in the digital world.

• 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 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 data center transformation and digital innovation, that represent the ways we help our clients with the demands they face, as discussed in more detail below.

• Our track record for successfully integrating mergers and acquisitions to accelerate growth – we have a demonstrated track record for acquiring strategic businesses and integrating them into the Insight model, while effectively realizing the benefits of the combined businesses.

Our Business Strategy

A client’s information technology service needs span an array of business priorities including modern infrastructure and cloud options, workforce productivity initiatives, and leveraging IT to differentiate with their customers.  We believe our four solution areas effectively represent the areas that our clients care about most and were designed to allow our clients, and the different decision makers within our clients, to interact with us in multiple ways, whether acquiring a hardware or software asset, implementing public cloud or as-a-service workplace solutions, designing a next generation or hybrid cloud data center, or leveraging sophisticated IOT and artificial intelligence solutions to improve their clients’ experience.  At each connection point, we provide technical expertise and advisory services to our clients.  

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Our go to market framework for our four solution areas, built on thirty years of broad IT experience combined with strategic acquisitions, new services development and deep partner relationships, uniquely positions us to help our clients manage their business today and also transform to meet their needs tomorrow.  Our expertise is deep across these key solutions areas:

	Supply Chain Optimization– Through Insight’s core business, we help clients effectively and efficiently acquire all of their information technology needs leveraging our scale and supply chain expertise. We help our clients invest smarter.
	Connected Workforce – We help clients deliver a secure, modern experience to their workforce, driving productivity in the workplace and helping to attract and retain talent in this competitive marketplace. We help our clients work smarter.
	Cloud and Data Center Transformation – We help clients optimize, modernize and secure their data center infrastructure and leverage cloud to improve business agility. We help our clients run workloads smarter.
	Digital Innovation – We leverage innovative applications and emerging technologies to improve clients’ business performance, engage customers and uncover new revenue streams. We help our clients innovate smarter.

Each of our solution areas represents a discrete area of growth for our business and when connected to each other, they provide a platform for our clients to leverage our breadth of expertise to solve their most relevant business challenges from IT supply chain to optimizing performance in the digital world.  Our strategy is to increase our penetration with new and existing clients within the four focus solution areas across our geographic footprint in North America, EMEA and APAC. Our offerings within the solution areas include hardware and software products from market leading and emerging manufacturer brands, sold separately or combined into branded solutions with Insight delivered professional or managed services.  We can serve clients directly in each of our markets or serve a single client globally where they can enjoy a common experience across our footprint.  To execute our strategy, we employ centralized and field-based sales, engineering and services resources to connect with our clients.  We also have invested in approximately 1,000 technical engineers, architects and software developers who create and deliver integrated IT solutions to our clients globally, an asset that we believe differentiates us in the marketplace.  

Our unique solution area go to market strategy is supported by a strong operational platform that includes scalable IT and e-commerce systems and processes, robust digital marketing capabilities and a culture of continuous business process transformation and automation.  

E-commerce and Cloud Management Systems - In recent years, cloud and as-a-service solutions have become more mainstream and adoption continues to increase across markets and verticals.  Key market imperatives in the adoption of these 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.

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We also continue to invest in our global e-commerce platform,which serves as a single marketplace for our clients to buy and manage anything from a discrete product offering to their cloud and other as-a-service subscriptions.  Components of our e-commerce platform include:

• 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.

• 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 capabilities allowing larger IT organizations to centrally provide cloud offerings while maintaining the manageability and visibility they require.

Digital Marketing Enablement –We have invested in internal industry and marketing expertise to develop original go to market and IT solution content, whitepapers and industry research studies to ensure we enable our clients with relevant information around IT and business trends.  Further, we leverage a best-in-class digital marketing technology stack to personalize the delivery of our content through an omni-channel experience as they manage and transform their IT investment. Our integrated suite of digital marketing tools has allowed us to access and grow our position in the mid-market over the past few years while also strengthening our marketing alignment with our partners.

Culture of Business Transformation and Automation – At the heart of our culture is an intense desire to improve our clients’ experience when doing business with us either on the web, through business to business connections or on the telephone.  We have a dedicated business transformation team focused on end to end process improvement initiatives around order flow, dynamic pricing and cost optimization, and back office operations, all oriented to the impact on client experience.  In 2018, we began to invest in process automation and optical recognition scanning solutions to improve certain of our client facing processes, making the buying experience more frictionless while improving the scalability of our business processes for the long term.

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 61%, 27% and 12%, respectively, of our net sales in 2018.  This compares to 58%, 32% and 10%, respectively, of our net sales in 2017 and 54%, 37% and 9%, respectively, of our consolidated net sales in 2016.  Additional detailed sales mix information by operating segment can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and in Note 19 to the Consolidated Financial Statements in Part II, Item 8 of this report.  

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:

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Supply Chain Optimization–Growing pressure on IT budgets and increasing trends in outsourcing of non-core functions are changing the way clients approach procurement and management of core IT investments.  We provide end to end lifecycle services around hardware and software that help our clients optimize their IT return on investments.

• Hardware Life Cycle: Source, procure, stage, configure, integrate, test, deploy and maintain IT products spanning endpoints to infrastructure, regionally, or across the globe via the Insight footprint and an engaged network of suppliers.

• Software Life Cycle: Portfolio management, compliance, integration and adoption, on premise or in the cloud, regionally or across the globe.

• Hardware Warranty and Software Maintenance: Warranty and maintenance services covering an array of products that can be purchased as a point solution or as a managed service delivered by Insight.

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 an “over the air” deployment model, managed by Insight’s 24x7 Service Desk. 

• 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 mobility experience for clients.

• 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: This comprises multi-site deployments of devices or technology within a branch or at the edge, combined with dedicated, onsite desktop support technicians coupled with 24x7 Service Desk.

• Security: Identity and access management, single-sign-on and mobile-device-management to protect end users.

• Software as a Service (“SaaS”):  SaaS solutions from mature and emerging publishers, sold discretely or combined into an Insight delivered solution.

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. Our solutions help clients assess readiness, architect appropriate solutions and migrate to both public and private cloud infrastructures.

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

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

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

• Security: Network security and Security Incident Event Management solutions to secure our clients’ infrastructure.

• Infrastructure as a Service (“IaaS”):  IaaS solutions from mature and emerging publishers, sold discretely or combined into an Insight delivered solution.

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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.  Our digital innovation solutions leverage our deep expertise around public cloud, mobility, big data and ensuring secure access to integrated solutions.

• 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.

• 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.

• Big Data & Analytics. Custom solutions to help clients quickly review actionable insights within their data, 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.  

Hardware Product Offerings

We offer products from hundreds of manufacturers, including such industry leaders as Cisco, Dell/EMC, HP Inc., Lenovo, Hewlett Packard Enterprise Company (“HPE”), NetApp, Apple, Microsoft 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 warehousing 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 Product 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, VMware, Adobe, IBM Software, Symantec and Citrix.  

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.  With many publishers now offering public cloud-based software solutions in place of licenses consumed on premise, we expect we will continue to see migration to the cloud-based software alternatives discussed above in our services offerings.

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.  

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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 migrateour 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:

• Solution providers, value-added resellers and direct marketers such as CDW, Zones, Connection, PCM, SHI, Softchoice, Systemax, Computacenter, Bechtle, SoftwareONE, Comparex, and Crayon;

• Systems integrators such as ePlus, Presidio, World Wide Technology, Perficient and Accenture;

• 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;

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

• E-tailers, such as Amazon Web Services, 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 2018, we purchased products and software from approximately 3,500 partners.  Approximately 69% (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 2018.  No other partner accounted for more than 10% of purchases in 2018.  Our top five partners as a group for 2018 were Microsoft, Cisco Systems, Tech Data (a distributor), HP Inc. and Ingram Micro (a distributor), and approximately 60% of our total purchases during 2018 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.    

During 2018, sales of Microsoft, Dell and Cisco Systems products accounted for approximately 18%, 11% and 11%, respectively, of our consolidated net sales.  No other manufacturer’s products accounted for more than 10% of our consolidated net sales in 2018.  Sales of product from our top five manufacturers/publishers as a group (Microsoft, Dell, Cisco Systems, HP Inc. and Lenovo) accounted for approximately 56% of Insight’s consolidated net sales during 2018.

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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 believe that 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, 2018, we employed 7,420 teammates, of whom 2,455 were engaged in sales related activities, 2,424 were engaged in management, support services and administration activities, 2,384 were skilled, certified consulting and service delivery professionals and 157 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;

• 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.

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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. 

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

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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 and other investments, 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, increases in customer usage, 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 and technologies.  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 acquisition, 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. In connection with our strategic initiatives, we regularly acquire new businesses to expand our technical capabilities, product offerings and customer base and to realize cost savings. All acquisitions entail various risks such as difficulties in realizing the benefits of the acquired business, exposure to unexpected liabilities, difficulties in retaining key employees and adverse customer reactions.  In addition, 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 are 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;

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

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• currency exchange fluctuations;

• changes in import/export laws, regulations and customs and duties and tariffs (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, government shutdowns, 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”), calling 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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Our acquisition strategy may increase our outstanding debt and interest expense and decrease 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 initiatives, we increase our total borrowings from time to time.  These additional borrowings have the effect of increasing our future interest expenses and require escalating amortization payments.  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 proprietary and 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.  Like many other businesses, we have been, and expect to continue to be, subject to electronic data attacks and threats, although we do not believe attacks have resulted in the misappropriation of sensitive data in a material way.  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 may be required to notify regulators and individuals of a data breach and 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 economic life or the value of our current system is impaired, or necessary improvements to our technology are significantly delayed, we could incur additional expense and/or 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 and currently engage in 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 sustained 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 leadership team, 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, including but not limited to U.S. federal and state regulations or interpretations resulting from the Tax Cuts and Jobs Act of 2017;

• tax effects related to purchase accounting for acquisitions; and

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

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, 2018, we owned or leased approximately 1.4 million square feet of office and warehouse space, and, while approximately 70% 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, 2018 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
	Apeldoorn, Netherlands	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 8 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 16 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.

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.  As of February 15, 2019, we had 35,502,671 shares of common stock outstanding held by 51 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, 2018.

See further information on our share repurchase programs in Note 15 to the Consolidated Financial Statements in Part II, Item 8 of this report.  

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INSIGHT ENTERPRISES, INC.

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, 2013 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, 2013		Dec. 31, 2014		Dec. 31, 2015		Dec. 31, 2016		Dec. 31, 2017		Dec. 31, 2018
Insight Enterprises, Inc. Common    Stock (NSIT)	$	100.00	$	114.00	$	110.61	$	178.07	$	168.60	$	179.44
Nasdaq US Benchmark TR Index    (Market Index)		100.00		112.46		113.00		127.70		155.01		146.57
Nasdaq US Benchmark Computer    Hardware TR Index (Industry Index)		100.00		135.56		123.42		142.26		204.61		191.61

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INSIGHT ENTERPRISES, INC.

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, 2018 is derived from our audited consolidated financial statements.  The consolidated financial statements as of December 31, 2018 and 2017, and for each of the years in the three-year period ended December 31, 2018, 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,
	2018			2017			2016			2015			2014
	(in thousands, except per share data)
Consolidated Statements of    Operations Data (1)(2)(3)
Net sales	$	7,080,136		$	6,703,623		$	5,485,515		$	5,373,090		$	5,316,229
Costs of goods sold		6,086,418			5,785,053			4,742,413			4,656,758			4,603,826
Gross profit		993,718			918,570			743,102			716,332			712,403
Operating expenses:
Selling and administrative    expenses		756,529			723,328			585,243			584,906			576,967
Severance and restructuring    expenses		3,424			9,002			4,580			4,907			4,433
Loss on sale of foreign entity		—			3,646			—			—			—
Acquisition-related expenses		282			3,329			4,447			—			—
Earnings from operations		233,483			179,265			148,832			126,519			131,003
Non-operating (income) expense:
Interest income		(1,075	)		(1,209	)		(1,066	)		(783	)		(1,062	)
Interest expense		22,812			19,174			8,628			7,224			6,019
Net foreign currency exchange    loss (gain)		(1,498	)		855			522			(393	)		327
Other expense, net		1,342			1,347			1,290			1,295			1,347
Earnings before income taxes		211,902			159,098			139,458			119,176			124,372
Income tax expense		48,225			68,415			54,768			43,325			48,688
Net earnings	$	163,677		$	90,683		$	84,690		$	75,851		$	75,684
Net earnings per share:
Basic	$	4.60		$	2.54		$	2.35		$	2.00		$	1.84
Diluted	$	4.55		$	2.50		$	2.32		$	1.98		$	1.83
Shares used in per share    calculations:
Basic		35,586			35,741			36,102			37,984			41,062
Diluted		36,009			36,207			36,438			38,275			41,358

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	December 31,
	2018		2017		2016		2015		2014
	(in thousands)
Consolidated Balance Sheet Data
Working capital	$	801,915	$	804,369	$	544,943	$	543,534	$	565,559
Total assets		2,775,947		2,685,651		2,219,300		2,014,017		1,947,838
Short-term debt, including capital leases    and other financing obligations (4)		1,395		16,592		480		1,535		766
Long-term debt, including capital leases    and other financing obligations (4)		195,525		296,576		40,251		89,000		62,535
Stockholders’ equity		986,989		843,469		713,443		685,742		721,231
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: Cardinal from August 1, 2018, Caase.com from September 26, 2017, Datalink from January 6, 2017, Ignia from September 1, 2016 and BlueMetal from October 1, 2015.

(2) Our consolidated statement of operations for 2018 includes the impact of adopting ASU No. 2014-09, “Revenue from Contracts with Customers,” which created FASB Topic 606 (“Topic 606”).  See Note 2 to the Consolidated Financial Statements in Part II, Item 8 of this report.

(3) Our consolidated statements of operations for 2018 and 2017 include the impact of U.S federal tax reform that was enacted in December 2017 as part of the U.S Tax Cuts and Jobs Act.  See Note 11 to the Consolidated Financial Statements in Part II, Item 8 of this report.

(4) Excludes obligations under our inventory financing facility of $304.1 million, $319.5 million, $154.9 million, $106.3 million and $122.8 million as of December 31, 2018, 2017, 2016, 2015 and 2014, 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 6 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.

Overview

Today, every business is a technology business.  We empower organizations of all sizes with Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter.  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 2018 financial and operational highlights included the following:

• We generated double-digit growth in earnings from operations globally and in each of our reporting segments.

• We grew our services business by 25% on a consolidated basis with double-digit growth in each of our reporting segments.

• We generated cash flows from operations of $292.6 million.

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

• In North America, we completed the acquisition of Cardinal on August 1, 2018 and substantially completed the integration of IT systems and back office operations in late January 2019.  

On a consolidated basis, for the year ended December 31, 2018:

• Net sales of $7.1 billion increased 6% compared to 2017.  

• Gross profit of $993.7 million increased 8% compared to 2017, also up 7% year over year excluding the effects of fluctuating foreign currency exchange rates.  

• Consolidated gross margin improved approximately 30 basis points to 14.0% of net sales in 2018.  This increase reflects solid growth in services net sales and gross profit.  

• Earnings from operations increased to $233.5 million in 2018, up 30% compared to the prior year, which represented 3.3% of net sales.  

• Our effective tax rate in 2018 was 22.8%, driven by the effects of U.S. federal tax reform enacted in December 2017.  This lower tax rate in 2018 compares to our effective tax rate of 43.0% in 2017 and 39.3% in 2016.  

• Net earnings and diluted net earnings per share were $163.7 million and $4.55, respectively, in 2018. In 2017, we reported net earnings of $90.7 million and diluted net earnings per share of $2.50.  In 2016, we reported net earnings of $84.7 million and diluted net earnings per share of $2.32.    

The results of operations for 2018 include the following items:

• the impact of the adoption of FASB Topic 606 (“Topic 606”);

• the results of the acquisition of Cardinal, effective August 1, 2018;

• transaction costs totaling $282,000 associated with the acquisition;

• severance and restructuring expenses of $3.4 million, $2.7 million net of tax; and

• the repurchase of approximately 641,000 shares of the Company’s common stock for an aggregate of $22.0 million.

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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 an aggregate of $50.0 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 2018, we generated $292.6 million of cash from operating activities, including approximately $75.0 million, net of cash and cash equivalents acquired, utilized to fund the acquisition of Cardinal.  We ended the year with $142.7 million of cash and cash equivalents and $194.0 million of debt outstanding under our long-term debt facilities.  In December 2018 we paid off the remaining balance of our Term Loan A (“TLA”).

Details about segment results of operations can be found in Note 19 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)

RESULTS OF OPERATIONS

The following table sets forth certain financial data as a percentage of net sales for the years ended December 31, 2018, 2017 and 2016:  

	2018			2017			2016
Net sales		100.0	%		100.0	%		100.0	%
Costs of goods sold		86.0			86.3			86.5
Gross profit		14.0			13.7			13.5
Operating expenses:
Selling and administrative expenses		10.6			10.8			10.7
Severance and restructuring expenses, loss on sale    of foreign entity and acquisition-related expenses		0.1			0.2			0.1
Earnings from operations		3.3			2.7			2.7
Non-operating expense, net		0.3			0.3			0.2
Earnings before income taxes		3.0			2.4			2.5
Income tax expense		0.7			1.0			1.0
Net earnings		2.3	%		1.4	%		1.5	%

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. 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.

2018 Compared to 2017

Net Sales.  Net sales increased 6%, or $376.5 million, in 2018 compared to 2017.  Net sales of products increased 3% and net sales of services increased 25% in 2018 compared to 2017.  Our net sales by operating segment for 2018 and 2017 were as follows (dollars in thousands):

	2018		2017		% Change
North America	$	5,362,981	$	5,181,734		3	%
EMEA		1,530,241		1,355,416		13	%
APAC		186,914		166,473		12	%
Consolidated	$	7,080,136	$	6,703,623		6	%

Net sales in North America increased 3%, or $181.2 million, in 2018 compared to 2017, primarily driven by higher hardware and services net sales.  Net sales in EMEA increased 13% (9% excluding the effects of fluctuating foreign currency exchange rates), or $174.8 million, in 2018 compared to 2017.  Net sales in APAC increased 12% (13% excluding the effects of fluctuating foreign currency exchange rates), or $20.4 million, in 2018 compared to 2017.  

Our net sales by offering category for North America for 2018 and 2017 were as follows (dollars in thousands):

	North America
Sales Mix	2018		2017		% Change
Hardware	$	3,610,356	$	3,352,355		8	%
Software		1,112,715		1,310,118		(15	%)
Services		639,910		519,261		23	%
	$	5,362,981	$	5,181,734		3	%

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

In North America net sales of hardware and services were up 8% and 23%, respectively, year over year, while net sales of softwaredeclined 15% year to year.  The net changes year over year were the result of the following:

• The increase in hardware net sales reflects the device refresh cycle in the first half of the year and was due primarily to higher volume sales of client devices, storage and networking solutionsto large enterprise clients.  

• The increase in services net sales was due to higher sales of hardware warranty, higher sales of cloud solution offerings, higher sales of software maintenance, higher enterprise agreement fees, as well as contribution from our Cardinal acquisition, effective August 1, 2018.

• The decrease in the software category was primarily the result of lower volume of sales with public sector clients.  Software product net sales have also been affected by clients migrating software applications to cloud solution offerings which are recognized on a net basis within the services category and the 2018 change to record sales of security software net as a result of the adoption of Topic 606.  

Our net sales by offering category for EMEA for 2018 and 2017 were as follows (dollars in thousands):   

	EMEA
Sales Mix	2018		2017		% Change
Hardware	$	653,499	$	536,500		22	%
Software		736,509		710,452		4	%
Services		140,233		108,464		29	%
	$	1,530,241	$	1,355,416		13	%

In EMEA, net sales of hardware, software and services were up 22%, 4% and 29%, respectively, year over year.  The improvements year over year were the result of the following:

• The increase in hardware net sales was due primarily to higher volume sales of client devices, storage and networking solutions to large enterprise and public sector clients.  

• The increase in services net sales was due primarily to a higher volume of sales of software maintenance and cloud solution offerings that are recognized on a net basis, as well as the contribution of Dutch cloud service provider, Caase.com, acquired effective September 26, 2017.  

• The increase in software net sales was due to higher volume with new and existing clients year over year.  

Our net sales by offering category for APAC for 2018 and 2017 were as follows (dollars in thousands):

	APAC
Sales Mix	2018		2017		% Change
Hardware	$	29,496	$	27,907		6	%
Software		107,363		101,412		6	%
Services		50,055		37,154		35	%
	$	186,914	$	166,473		12	%

In APAC, net sales of hardware, software and services were up 6%, 6% and 35%, respectively, year over year.  The changes were the result of the following:

• The increase in hardware net sales was primarily due to our continued expansion of hardware offerings in this market.  

• The increase in software net sales was due primarily to a single large public sector license renewal recorded in the first quarter of 2018 that historically transacted in the fourth quarter in prior years.  

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INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

• The increase in services net sales resulted from an increase in cloud and digital solutions based professional service engagements,as well as growth in the contribution of Ignia, acquired effective September 1, 2016.  

Net sales by category for North America, EMEA and APAC were as follows for 2018 and 2017:

	North America						EMEA						APAC
Sales Mix	2018			2017			2018			2017			2018			2017
Hardware		67	%		65	%		43	%		40	%		16	%		17	%
Software		21	%		25	%		48	%		52	%		57	%		61	%
Services		12	%		10	%		9	%		8	%		27	%		22	%
		100	%		100	%		100	%		100	%		100	%		100	%

Gross Profit.  Gross profit increased 8%, or $75.1 million, in 2018 compared to 2017, with gross margin increasing approximately 30 basis points to 14.0% of net sales.  Our gross profit and gross profit as a percent of net sales by operating segment for 2018 and 2017 were as follows (dollars in thousands):

	2018		% of Net Sales			2017		% of Net Sales
North America	$	732,695		13.7	%	$	691,677		13.3	%
EMEA		221,467		14.5	%		190,310		14.0	%
APAC		39,556		21.2	%		36,583		22.0	%
Consolidated	$	993,718		14.0	%	$	918,570		13.7	%

North America’s gross profit in 2018 increased $41.0 million, or 6%, compared to 2017. As a percentage of net sales, gross margin increased by approximately 40 basis points year over year.  The year over year net increase in gross margin was primarily attributable to the following:

• An increase in higher margin services net sales, which contributed 56 basis points.  This increase in margin from services net sales was driven by an increase in margin generated from enterprise agreement fees and sales of warranty services as well as by an increase in gross profit on cloud solution offerings.  

• This increase was partially offset by a decrease in margin from software products of 20 basis points due to a lower mix of software license sales, as clients are migrating to cloud-based solutions.  

EMEA’s gross profit in 2018 increased $31.2 million, or 16% (12% excluding the effects of fluctuating foreign currency exchange rates), compared to 2017.  As a percentage of net sales, gross margin increased by approximately 50 basis points year over year.  The net improvement in gross margin for EMEA in 2018 compared to 2017 was due primarily to the following:

• An increase in higher margin services net sales, which contributed 69 basis points.  The increase resulted from a higher volume of software maintenance and cloud solution net sales that are recorded on a net basis.  

• This increase was partially offset by a net decrease in product margin, which includes partner funding and freight, of 26 basis points in 2018 compared to 2017 primarily due to lower margins on software product transactions.

APAC’s gross profit increased 8% (9% excluding the effects of fluctuating foreign currency exchange rates) in 2018 compared to 2017, with gross margin decreasing to 21.2% in 2018 from 22.0% in 2017.    

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

Operating Expenses.

Selling and Administrative Expenses.  Selling and administrative expenses increased $33.2 million in 2018 compared to 2017.  Our selling and administrative expenses by major expense type for 2018 and 2017 were as follows (dollars in thousands):

	2018			2017
Personnel costs, including teammate benefits	$	593,955		$	562,406
Depreciation and amortization		37,458			42,599
Facility expenses		26,396			25,362
Travel and entertainment		25,656			24,607
Legal and professional fees		16,103			16,740
Marketing		10,345			10,640
Other		46,616			40,974
Total	$	756,529		$	723,328
Percentage of net sales		10.7	%		10.8	%

Selling and administrative expenses decreased approximately 10 basis points as a percentage of net sales in 2018 compared to 2017.  The overall net increase in expenses reflects a $31.5 million increase in personnel costs, including teammate benefits expenses primarily due to increased headcount and increased variable compensation resulting from increased sales and gross profit in 2018 compared to 2017. This was partially offset by a decrease in depreciation and amortization expense of approximately $5.1 million year to year.     

Severance and Restructuring Expenses.  During 2018, we recorded severance expense, net of adjustments, totaling $3.4 million.  In North America charges related to severance of $1.6 million were a result of actions taken to realign roles and responsibilities, as well as a headcount reduction as part of cost reduction initiatives in the fourth quarter of 2018.  In EMEA charges of $1.7 million primarily related to headcount reductions as part our cost reduction and restructuring initiatives in EMEA.  Current period charges were offset by adjustments for changes in estimates of previous accruals as cash payments were made during 2018.  During 2017, we recorded severance expense, net of adjustments, totaling $9.0 million.  See Note 9 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 2018, we incurred $282,000 in direct third-party transaction costs related to the acquisition of Cardinal in North America.  Comparatively, during 2017, we incurred $3.2 million in such 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.  See Note 20 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 2018 and 2017 was generated from interest earned on cash and cash equivalent bank balances.  The slight decrease in interest income year over year is primarily due to lower average interest-bearing cash and cash equivalent balances during 2018.

Interest Expense.  Interest expense primarily relates to borrowings under our financing facilities and imputed interest under our inventory financing facility.  Interest expense increased 19%, or $3.6 million, in 2018 compared to 2017 due primarily to higher interest rates partially offset by lower average daily balances on our debt facilities, in 2018 compared to 2017. Imputed interest under our inventory financing facility increased $3.9 million compared to 2017 to $10.6 million in 2018.  The increase was the result of expanded use of our inventory financing facility and a higher average incremental borrowing rate used to compute the imputed interest amounts during 2018.  Additionally, in 2018 interest expense includes a loss on debt extinguishment of approximately $624,000 recorded in the fourth quarter of 2018 to write off a portion of our deferred financing fees.  For a description of our various financing facilities, see Notes 6 and 7 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 (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 2018 compared to 2017.      

Income Tax Expense.  Our effective tax rate for 2018 was 22.8% compared to 43.0% in 2017.  The decrease in the tax rate from 2017 to 2018 was primarily due to the effect of the reduction in the U.S. federal statutory rate from 35.0% to 21.0% effective for the 2018 tax year and other tax effects recorded in connection with the enactment of the U.S. Tax Cuts and Jobs Act.  The effective tax rate in 2018 was higher than the federal statutory rate of 21.0% primarily due to state income taxes offset partially by research and development credits and a benefit related to the true up of provisional amounts related to U.S. tax reform recorded in 2017.  See Note 11 to the Consolidated Financial Statements in Part II, Item 8 of this report for further discussion of income tax expense.

2017 Compared to 2016

Any reference to our “core” business in the 2017 compared to 2016 discussion exclude Datalink’s results subsequent to the Datalink acquisition.

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.  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.  This included 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 in EMEA increased 1% (2% excluding the effects of fluctuating foreign currency exchange rates), or $16.9 million, in 2017 compared to 2016.  Net sales in APAC decreased 5% (7% excluding the effects of fluctuating foreign currency rates), or $8.7 million, in 2017 compared to 2016.  

Our net sales by offering category for North America for 2017 and 2016, were as follows (dollars in thousands):

	North America
Sales Mix	2017		2016		% Change
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, net sales of hardware, software and services increased 37%, 14% and 40%, respectively, year over year.  The increases year over year were the result of the following:

• Higher volume of hardware net sales to large enterprise clients due primarily to strong growth in data center solutions as well as client devices.  Datalink also accounted for approximately 29% of the year over year growth in the hardware category.  

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• Datalink accounted for approximately 70% of the year over year increase in software net sales.  

• Continued trend toward higher sales of cloud solution offerings and a higher mix of software maintenance sales that are recorded on a net sales recognition basis impacted the services net sales category.  Datalink also contributed to the increase, offset partially by declines in technical services projects in our core business in 2017 compared to 2016.  

Our net sales by offering category for EMEA for 2017 and 2016, were as follows (dollars in thousands):  

	EMEA
Sales Mix	2017		2016		% Change
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 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 changes were the result of the following:

• Higher volume of client devices, storage and networking solutions to public sector clients in the hardware category.

• Increased sales of license consulting services and partner delivered services to new and existing clients across the region impacted services net sales.  In addition, there was a higher volume of sales of software maintenance and cloud solution offerings that are recorded on a net sales recognition basis.  

• A single significant transaction in software net sales during 2016 with no comparable transaction in 2017 affected the year to year comparison.  

Our net sales by offering category for APAC for 2017 and 2016, were as follows (dollars in thousands):

	APAC
Sales Mix	2017		2016		% Change
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 increases in hardware and services net sales year over year were offset by a decrease in software net sales during 2017 compared to 2016.  The changes were the result of the following:

• Continued expansion of hardware offerings in the APAC market.

• Contributions of Ignia and higher volume of sales of software maintenance and cloud solution offerings that are recorded on a net sales recognition basis positively impacted services net sales.

• Timing of a single client agreement in the public sector resulted in decreased software net sales in 2017 compared to 2016.

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

	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	%

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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	%

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 net increase in gross margin was primarily attributable to the following:

• A net increase in product margin, which includes partner funding and freight, of 30 basis points year over year.  This increase was due primarily to improvements in hardware and software product margin due to the acquisition of Datalink, which includes sales of data center products at higher gross margins than in our core business.  

• Services margin improvement year over year of 11 basis points driven by an increase in margin generated by sales of warranty services during 2017 compared to 2016, primarily due to Datalink.  

The above increases were partially offset by the following:

• 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.  

• A decrease in margin from lower fees from enterprise software agreements of 23 basis points during 2017 compared to 2016.  

• An insurance settlement of $2.2 million 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% (4% excluding the effects of fluctuating foreign currency exchange rates) compared to 2016.  As a percentage of net sales, gross margin increased by approximately 10 basis points year over year.  APAC’s gross profit in 2017 increased 15% (13% excluding the effects of fluctuating foreign currency exchange rates) compared to 2016, with gross margin increasing to 22.0% in 2017 from 18.2% in 2016.  The improvement in gross margin for both EMEA and APAC in 2017 compared to 2016 was due primarily to changes in sales mix to higher margin products and services.  

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Operating Expenses.

Selling and Administrative Expenses.  Selling and administrative expenses increased $138.1 million in 2017 compared to 2016.  Our selling and administrative expenses by major expense type for 2017 and 2016 were as follows (dollars in thousands):

	2017			2016
Personnel costs, including teammate benefits	$	562,406		$	455,892
Depreciation and amortization		42,599			38,130
Facility expenses		25,362			20,314
Travel and entertainment		24,607			17,170
Legal and professional fees		16,740			11,905
Marketing		10,640			6,848
Other		40,974			34,984
Total	$	723,328		$	585,243
Percentage of net sales		10.8	%		10.7	%

Selling and administrative expenses increased approximately 10 basis points as a percentage of net sales in 2017 compared to 2016.  The increase in expenses reflects the addition of Datalink to our North America business effective January 2017.  The addition of Datalink and increased variable compensation resulting from increased sales and gross profit in 2017 compared to 2016 were the primary drivers for the $106.5 million increase in personnel costs, including teammate benefit expenses for 2017 compared to 2016.  Datalink was also the primary driver for year over year increases in travel and entertainment, facilities and marketing expenses.  Depreciation and amortization expense increased approximately $4.5 million year over year, due to additional amortization expense on newly acquired intangible assets.     

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.  For 2017, charges were offset by adjustments for changes in estimates of previous accruals as cash payments were made during the year.  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 9 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 20 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 TLA as well as higher borrowing rates and higher average daily balances under our other financing facilities, in 2017

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compared to 2016, while imputed interest under our inventory financing facility increased $3.3 million from 2016 to 2017to $6.7 million.  

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.

Liquidity and Capital Resources

The following table sets forth certain consolidated cash flow information for 2018, 2017 and 2016 (in thousands):

	2018			2017			2016
Net cash provided by (used in) operating activities	$	292,647		$	(307,066	)	$	96,077
Net cash used in investing activities		(91,710	)		(204,645	)		(21,185	)
Net cash (used in) provided by financing activities		(159,028	)		397,121			(58,230	)
Foreign currency exchange effect on cash and cash    equivalent and restricted cash balances		(5,061	)		16,089			(1,937	)
Increase (decrease) in cash and cash equivalents and restricted cash		36,848			(98,501	)		14,725
Cash and cash equivalents and restricted cash at beginning of year		107,445			205,946			191,221
Cash and cash equivalents and restricted cash at end of year	$	144,293		$	107,445		$	205,946

Cash and Cash Flow

Our primary uses of cash during 2018 were to fund working capital requirements, pay down our debt balances, fund capital expenditures, repurchase shares of our common stock and to fund the acquisition of Cardinal.  Operating activities generated $292.6 million in cash in 2018.  Both the 2017 and 2016 results are affected by individually significant transactions at each year end, as discussed in more detail below.  During 2018, we made net combined repayments on our long-term debt facilities of $114.8 million and acquired Cardinal for $78.8 million, net of cash and cash equivalents acquired and including accrued working capital and tax adjustments of approximately $3.8 million.  Capital expenditures were $17.3 million in 2018, a 10% decrease from 2017, reflecting continued IT investments in our core ERP systems and e-commerce and digital marketing platforms.  Cash and cash equivalent balances in 2018 were negatively affected by $5.1 million as a result of foreign currency exchange rates.

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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 provided by (used in) 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.  As noted previously, our net sales and earnings from operations grew 6% and 30%, respectively, in 2018.  Cash flow from operating activities in 2018 was $292.6 million, a significant increase in cash generation compared to 2017.  This increase is the result of our focus on expense control, optimizing working capital, including an enhanced focus on collection of receivables, and reducing our investments in inventory.  However, the 2017 results were also affected by a single significant payment to a supplier of approximately $160 million that was due and paid in January 2017 for which the related receivable was collected from the client in the fourth quarter of 2016 and several other factors discussed below.

In 2017, the increase in accounts receivable reflected increased net sales for which our collection efforts did not keep up with the growth.  The 2017 results also reflected 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.  Further impacting our 2017 operating cash flows was the expanded use of our inventory financing facility in 2017 to support growth in our sales.  Borrowings on this facility are reflected in the financing section of our statement of cash flows.  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 growth in 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.  There was a similar transaction in the fourth quarter of 2015 for approximately $60 million.  Excluding the effects of these two individually significant timing differences, cash flow from operations would have been nominal for 2016.  Further impacting our 2016 operating cash flows was the expanded use of our inventory financing facility in 2016 to support growth in our sales.  Had we not leveraged the facility during 2016, the net borrowings under our inventory financing facility of $48.6 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 $50.1 million increase in other assets was primarily a result of our deferral of costs 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 inventory in transit.

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AND RESULTS OF OPERATIONS (continued)

Our consolidated cash flow operating metrics for the quarters ended December 31, 2018, 2017and 2016wereas follows:

	2018			2017			2016
Days sales outstanding in ending accounts    receivable (“DSOs”) (a)		102			94			90
Days inventory outstanding (“DIOs”) (b)		10			13			12
Days purchases outstanding in ending accounts    payable (“DPOs”) (c)		(79	)		(72	)		(88	)
Cash conversion cycle (days) (d)		33			35			14

(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 was33 days in the fourth quarter ended December 31, 2018, compared to 35 days in the fourth quarter of 2017.  The decrease resulted from the net effect of an eight day increase in DSO and a seven day increase in DPOs due to the relative timing of client receipts and supplier payments during the respective quarters as well as a three day decrease in DIOs due to the reduction of inventory held for client specific engagements and an overall focus on minimizing inventory on hand.  These operating metrics include the effects of the adoption of the new revenue recognition standard effective January 1, 2018.  As a result, DSOs for the three months ended December 31, 2018 were higher by approximately six days, due to a higher accounts receivable balance being reported under the new accounting guidance, than would have been reported under the previous accounting guidance.  This increase was partially offset by an increase of approximately four days in DPOs in the three months ended December 31, 2018, resulting from a higher accounts payable balance being reported under the new accounting guidance.  The net impact of the adoption of the new revenue recognition standard to the cash conversion cycle for the three months ended December 31, 2018 is approximately a two day increase.

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 above.  Our 2017 cash conversion cycle was above our target range due to the increases in our inventory and accounts receivable balances noted above.  

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, and due primarily to an eleven 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, as discussed above.        

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 2019 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.

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AND RESULTS OF OPERATIONS (continued)

Net cash used in investing activities.  Capital expenditures of $17.3million, $19.2 million and$12.3 millionin2018, 2017 and2016, respectively, were primarily related to technology and facility enhancements.  We expect total capital expenditures in 2019to be between $20.0 million and $25.0 million, primarily fortechnology-related upgrade projects and the integration of prior acquisitions.

During 2018 we acquired Cardinal for $78.8 million net of cash and cash equivalents acquired and including accrued working capital and tax adjustments of approximately $3.8 million.  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.  

Net cash (used in) provided by financing activities.  During 2018, we had net combined repayments on our long-term debt under our revolving facility, TLA and accounts receivable securitization facility (“ABS facility”) of $114.8 million and had net repayments under our inventory financing facility of $15.3 million.  In 2018, we also funded $22.1 million of repurchases of our common stock.  During 2017, we had net combined borrowings on our long-term debt under our revolving facility, TLA and 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.  

Financing Facilities

As of December 31, 2018, our long-term debt balance includes $194.0 million outstanding under our $250.0 million ABS facility and no amounts outstanding under our $350.0 million revolving facility.  

As of December 31, 2018, the current portion of our long-term debt relates to our capital leases and other financing obligations.  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, 2018, qualified receivables were sufficient to permit access to the full $250.0 million under the ABS facility.  Our ABS facility was amended on June 27, 2018.

Our consolidated debt balance that can be outstanding at the end of any fiscal quarter under our revolving facility 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 is currently 3.25 times our trailing twelve-month adjusted earnings.  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, 2018, the Company’s debt balance that could have been outstanding under our revolving facility and ABS facility was the full amount of the maximum borrowing capacity of $600.0 million.

Our revolving facility 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, 2018, 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, 2018, no such “amortization event” had occurred.

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AND RESULTS OF OPERATIONS (continued)

Wealso 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.  

Our inventory financing facility was amended on March 23, 2018 to increase the aggregate availability for vendor purchases under the facility from $325,000,000 to $400,000,000.  In conjunction with the increase, we no longer have the option to request additional increases in the aggregate amount available under the inventory financing facility without amending the facility.  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 terms (typically 60 days).

Notes 6 and 7 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 may be 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 2018.  As of December 31, 2018, we had approximately $107.6 million in cash and cash equivalents in certain of our foreign subsidiaries.  As of December 31, 2018, 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 16 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.  

Contractual Obligations

At December 31, 2018, our contractual obligations for continuing operations were as follows (in thousands):

	Payments due by period
			Less than		1-3		3-5		More than 5
	Total		1 Year		Years		Years		Years
Long-term debt (a)	$	194,000	$	—	$	194,000	$	—	$	—
Capital lease obligations, including interest    payments		3,071		1,488		1,583		—		—
Inventory financing facility (b)		304,130		304,130		—		—		—
Operating lease obligations (c)		71,884		21,499		27,701		15,446		7,238
Severance and restructuring obligations (d)		2,452		2,452		—		—		—
Other contractual obligations (e)		23,336		7,803		12,203		1,046		2,284
Total	$	598,873	$	337,372	$	235,487	$	16,492	$	9,522

(a) Reflects the $194.0 million outstanding at December 31, 2018 under our ABS facility due in June 2021, the date at which the facility matures. See further discussion in Note 7 to the Consolidated Financial Statements in Part II, Item 8 of this report.

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(b) As of December 31, 2018, 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 6to 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.

(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 9 to the Consolidated Financial Statements in Part II, Item 8 of this report.

(e) The table above includes:

I. Estimated interest payments of $6,712,000 in each of 2019 and 2020, and $3,356,000 in the first six months of 2021, based on the current debt balance at December 31, 2018 of $194.0 million under our ABS facility, multiplied by the floating interest rate applicable at December 31, 2018 of 3.46% per annum.

II. We estimate that we will owe $6.6 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 $6.8 million of unrecognized tax benefits, including $313,000 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 20 to the Consolidated Financial Statements in Part II, Item 8 of this report for a discussion of our acquisition of Cardinal on August 1, 2018.

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.

39

INSIGHT ENTERPRISES, INC.

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

We adopted ASU No. 2014-09, “Revenue from Contracts with Customers,” which created Topic 606 with a date of initial application of January 1, 2018.  As a result, we changed our accounting policy for sales recognition as detailed below and in Note 2 to Consolidated Financial Statements in Part II, Item 8 of this report.  Revenue is measured based on the consideration specified in a contract with a client, and excludes any sales incentives and amounts collected on behalf of third parties.  The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product or service to a client.

Nature of Goods and Services

We sell hardware and software products on both a stand-alone basis without any services and as solutions bundled with services.

When we provide a combination of hardware and software products with the provision of services, we separately identify our performance obligations under our contract with the client as the distinct goods (hardware and/or software products) or services that will be provided.  The total transaction price for an arrangement with multiple performance obligations is allocated at contract inception to each distinct performance obligation in proportion to its stand-alone selling price.  The stand-alone selling price is the price at which we would sell a promised good or service separately to a client.  We estimate the price based on observable inputs, including direct labor hours and allocable costs, or use observable stand-alone prices when they are available.

Product Offerings

Hardware

We recognize hardware product revenue at the point in time when a client takes control of the hardware, which typically occurs when title and risk of loss have passed to the client at its destination.  Our selling terms and conditions were modified during the fourth quarter of 2017 to specify F.O.B. destination contractual terms such that control is transferred from the Company at the point in time when the product is received by the client.  Prior to the adoption of Topic 606, because we either (i) had a general practice of covering client losses while products were in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) had specifically stated F.O.B. destination contractual terms with the client, delivery was not deemed to have occurred until the point in time when the product was received by the client.  The transaction price for hardware sales is adjusted for estimated product returns that we expect to occur under our return policy based upon historical return rates.

40

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

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 as the principal in the transaction when the product is received by the client because we control the product prior to transfer to the client.  We also assume primary responsibility for 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 and we work closely with our clients to determine their hardware specifications.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Software

We recognize revenue from software sales at the point in time when the client acquires the right to use or copy software under license and control transfers to the client.  For sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we record both the software license and the accompanying software maintenance on a net basis, as the agent in the arrangement, given the predominant nature of the goods and services provided to the customer. This is a change from our accounting treatment prior to the adoption of Topic 606, whereby we bifurcated the sale of the software license from the sale of the maintenance contract, recorded the sale of the software product on a gross sales recognition basis and recorded the sale of the software maintenance on a net sales recognition basis.

Services Offerings

Software Maintenance

Software maintenance agreements provide our clients with the right to obtain any software upgrades, bug fixes and help desk and other support services directly from the software publisher at no additional charge during the term of the software maintenance agreements.  We act as the software publisher’s agent in selling these software maintenance agreements and do not assume any performance obligation to the client under the agreements.  As a result, we are the agent in these transactions and these sales are recorded on a net sales recognition basis.  Under net sales recognition, the cost of the software maintenance agreement 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.  Because we are acting as the software publisher’s agent, revenue is recognized when the parties agree to the initial purchase, renewal or extension as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.  

Cloud / Software-as-a-Service Offerings

Cloud or software-as-a-service subscription products provide our clients with access to software products hosted in the public cloud without the client taking possession of the software.  We act as the software publisher’s agent in selling these software-as-a service subscription products and do not host the software products on our servers.  We do not take control of the software products or assume any performance obligations to the clients related to the provisioning of the offerings in the cloud.  As a result, these sales are recorded on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.

Insight Delivered Services

We design, procure, deploy, implement and manage solutions that combine hardware, software and services to help businesses run smarter.  Such services are provided by us or third-party sub-contract vendors as part of bundled arrangements, or are provided separately on a stand-alone basis as technical, consulting or managed services engagements.  If the services are provided as part of a bundled arrangement with hardware and software, the hardware, software and services are generally distinct performance obligations.  In general, we recognize revenue from services engagements as we perform the underlying services and satisfy our performance obligations.

41

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

We recognize revenue from sales of services by measuring progress toward complete satisfaction of the related service performance obligation.  Billings for such services that are made in advance of the related revenue recognized are recorded as a contract liability.  

Specific revenue recognition practices for certain of our services offerings are described in further detail below.

OneCall Support Services Contracts  

When we sell certain hardware and/or software products to our clients, we also enter into service contracts with them.  These contracts are support service agreements for the hardware and/or software products that were purchased from us.  Under certain support services contracts, although we purchase third-party support contracts for maintenance on the specific hardware or software products we have sold, our internal support desk assists the client first by performing an initial technical triage to determine the source of the problem and whether we can direct the client on how to fix the problem.  We refer to these services as “OneCall.”  We act as the principal in the transaction because we perform the OneCall services over the term of the support service contract and we set the price of the service charged to the client.  As a result, we recognize revenue from OneCall extended service contracts on a gross sales recognition basis ratably over the contract term of the stand ready obligation, generally one to three years.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Vendor Direct Support Services Contracts

When we do not provide OneCall services to the client on hardware and/or software products that were purchased, the client may purchase a vendor direct support services contract through us.  Under these contracts, our clients call the manufacturer/publisher or its designated service organization directly for both the initial technical triage and any follow-up assistance.  We act as the manufacturer/publisher’s agent in selling these support service contracts and do not assume any performance obligation to the client under the arrangements.  As a result, these sales are recorded on a net sales recognition basis similar to software maintenance agreements, as discussed above.  Because we are acting as the manufacturer/publisher’s agent, revenue is recognized when the parties agree to the purchase of the support services contract as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Third-party Provided Services  

A majority of our third-party sub-contractor services contracts are entered into in conjunction with other services contracts under which the services are performed by Insight teammates.  We have concluded that we control all services under the contract and can direct the third-party sub-contractor to provide the requested services.  As such, we act as the principal in the transaction and record the services under a gross sales recognition basis, with the selling price being recorded in sales and our cost to the third-party service provider being recorded in costs of goods sold.  For certain third-party service contracts in which we are not responsible for fulfillment of the services, we have concluded that we are an agent in the transaction and record revenue on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

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 sales recognition.    

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

42

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

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 estimates including 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.  

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

43

INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

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 4 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 Cuts and Jobs Act of 2017.  The change in tax law required, among other things, a remeasurement of our deferred tax balances.  In addition, the change in tax law included provisions requiring mandatory deemed repatriation of undistributed foreign earnings.  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 now final.

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.    

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.

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.

44

INSIGHT ENTERPRISES, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Item 8.Financial Statements and Supplementary Data

	Page
Reports of Independent Registered Public Accounting Firm	46
Consolidated Balance Sheets – December 31, 2018 and 2017	48
Consolidated Statements of Operations – For each of the years in the three-year period ended December 31, 2018	49
Consolidated Statements of Comprehensive Income – For each of the years in the three-year period ended December 31, 2018	50
Consolidated Statements of Stockholders’ Equity – For each of the years in the three-year period ended December 31, 2018	51
Consolidated Statements of Cash Flows – For each of the years in the three-year period ended December 31, 2018	52
Notes to Consolidated Financial Statements	53

45

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 accompanyingconsolidated balance sheetsofInsight Enterprises, Inc. andsubsidiaries (the “Company”) as of December 31, 2018 and 2017, the related consolidatedstatements of operations,comprehensive income,stockholders’ equity, and cash flows for each of the years in the three-year period endedDecember 31, 2018, 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 ofthe Companyas of December 31, 2018and 2017, and the resultsof its operations and itscash flows for eachof the years in the three-year period ended December 31, 2018, in conformity with U.S. generally acceptedaccounting 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, 2018, 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 22, 2019, expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for revenue in 2018 due to the adoption of the FASB’s Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’smanagement. Ourresponsibility is to expressan opinion on these consolidated financial statements based on our audits. We area public accounting firm registered withthe PCAOB and arerequired to be independent withrespect to theCompany in accordancewith the U.S. federalsecurities laws and the applicable rules andregulations of theSecurities and Exchange Commissionand 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 22, 2019

46

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, 2018, 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, 2018, 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, 2018 and 2017, 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, 2018, and the related notes (collectively, the “consolidated financial statements”), and our report dated February 22, 2019 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 Annual 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.

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 22, 2019

47

INSIGHT ENTERPRISES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

ASSETS	December 31,
	2018			2017
Current assets:
Cash and cash equivalents	$	142,655		$	105,831
Accounts receivable, net		1,931,736			1,814,560
Inventories		148,503			194,529
Inventories not available for sale		—			36,956
Other current assets		115,683			152,467
Total current assets		2,338,577			2,304,343
Property and equipment, net		72,954			75,252
Goodwill		166,841			131,431
Intangible assets, net		112,179			100,778
Deferred income taxes		7,967			17,064
Other assets		77,429			56,783
	$	2,775,947		$	2,685,651
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable—trade	$	978,104		$	899,075
Accounts payable—inventory financing facility		304,130			319,468
Accrued expenses and other current liabilities		190,733			175,860
Current portion of long-term debt		1,395			16,592
Deferred revenue		62,300			88,979
Total current liabilities		1,536,662			1,499,974
Long-term debt		195,525			296,576
Deferred income taxes		683			717
Other liabilities		56,088			44,915
		1,788,958			1,842,182
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;    35,482 and 35,829 shares issued and outstanding,    respectively		355		358
Additional paid-in capital		323,622			317,155
Retained earnings		704,665			550,220
Accumulated other comprehensive loss – foreign currency    translation adjustments		(41,653	)	(24,264)
Total stockholders’ equity		986,989			843,469
	$	2,775,947		$	2,685,651

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,
	2018			2017			2016
Net sales:
Products	$	6,249,938		$	6,038,744		$	4,997,263
Services		830,198			664,879			488,252
Total net sales		7,080,136			6,703,623			5,485,515
Costs of goods sold:
Products		5,711,400			5,512,402			4,571,462
Services		375,018			272,651			170,951
Total costs of goods sold		6,086,418			5,785,053			4,742,413
Gross profit		993,718			918,570			743,102
Operating expenses:
Selling and administrative expenses		756,529			723,328			585,243
Severance and restructuring expenses		3,424			9,002			4,580
Loss on sale of foreign entity		—			3,646			—
Acquisition-related expenses		282			3,329			4,447
Earnings from operations		233,483			179,265			148,832
Non-operating (income) expense:
Interest income		(1,075	)		(1,209	)		(1,066	)
Interest expense		22,812			19,174			8,628
Net foreign currency exchange (gain) loss		(1,498	)		855			522
Other expense, net		1,342			1,347			1,290
Earnings before income taxes		211,902			159,098			139,458
Income tax expense		48,225			68,415			54,768
Net earnings	$	163,677		$	90,683		$	84,690
Net earnings per share:
Basic	$	4.60		$	2.54		$	2.35
Diluted	$	4.55		$	2.50		$	2.32
Shares used in per share calculations:
Basic		35,586			35,741			36,102
Diluted		36,009			36,207			36,438

See accompanying notes to consolidated financial statements.

49

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

	Years Ended December 31,
	2018			2017		2016
Net earnings	$	163,677		$	90,683	$	84,690
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		(17,389	)		31,835		(16,063	)
Total comprehensive income	$	146,288		$	122,518	$	68,627

See accompanying notes to consolidated financial statements.

50

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, 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
Cumulative effect of accounting change		—			—			—			—			—			—			7,176			7,176
Issuance of common stock under employee    stock plans, net of shares withheld for payroll    taxes		294			3			—			—			(3,233	)		—			—			(3,230	)
Stock-based compensation expense		—			—			—			—			15,355			—			—			15,355
Repurchase of treasury stock		—			—			(641	)		(22,069	)		—			—			—			(22,069	)
Retirement of treasury stock		(641	)		(6	)		641			22,069			(5,655	)		—			(16,408	)		—
Foreign currency translation adjustments, net of    tax		—			—			—			—			—			(17,389	)		—			(17,389	)
Net earnings		—			—			—			—			—			—			163,677			163,677
Balances at December 31, 2018		35,482		$	355			—		$	—		$	323,622		$	(41,653	)	$	704,665		$	986,989

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,
	2018			2017			2016
Cash flows from operating activities:
Net earnings	$	163,677		$	90,683		$	84,690
Adjustments to reconcile net earnings to net cash provided by    (used in) operating activities:
Depreciation and amortization of property and equipment		21,721			25,787			27,493
Amortization of intangible assets		15,737			16,812			10,637
Provision for losses on accounts receivable		4,776			5,245			2,452
Write-downs of inventories		2,912			2,776			2,934
Write-off of property and equipment		393			418			—
Non-cash stock-based compensation		15,355			12,826			11,058
Deferred income taxes		9,126			19,139			10,517
Loss on sale of foreign entity		—			3,646			—
Loss on extinguishment of debt		624			—			—
Gain on sale of real estate		—			—			(338	)
Changes in assets and liabilities:
Increase in accounts receivable		(46,883	)		(208,065	)		(168,966	)
Decrease (increase) in inventories		46,534			(14,046	)		(50,712	)
Decrease (increase) in other assets		12,424			3,342			(50,181	)
Increase (decrease) in accounts payable		29,844			(237,457	)		193,582
Increase (decrease) in deferred revenue		9,178			(27,184	)		10,633
Increase (decrease) in accrued expenses and other    liabilities		7,229			(988	)		12,278
Net cash provided by (used in) operating    activities		292,647			(307,066	)		96,077
Cash flows from investing activities:
Acquisitions, net of cash and cash equivalents    acquired		(74,938	)		(186,932	)		(10,297	)
Purchases of property and equipment		(17,251	)		(19,230	)		(12,266	)
Proceeds from sale of foreign entity		479			1,517			—
Proceeds from sale of real estate		—			—			1,378
Net cash used in investing activities		(91,710	)		(204,645	)		(21,185	)
Cash flows from financing activities:
Borrowings on senior revolving credit facility		569,232			1,151,216			772,218
Repayments on senior revolving credit facility		(686,732	)		(1,033,716	)		(772,218	)
Borrowings on accounts receivable securitization    financing facility		3,357,000			3,961,389			2,802,000
Repayments on accounts receivable securitization    financing facility		(3,188,000	)		(3,975,889	)		(2,851,500	)
Borrowings under Term Loan A		—			175,000			—
Repayments under Term Loan A		(166,250	)		(8,750	)		—
Repayments under other financing agreements		(2,372	)		(5,636	)		(1,309	)
Payments on capital lease obligations		(999	)		(1,089	)		(445	)
Net (repayments) borrowings under inventory    financing facility		(15,338	)		141,037			48,603
Payment of debt issuance costs		(270	)		(1,123	)		(3,360	)
Payment of payroll taxes on stock-based    compensation through shares withheld		(3,230	)		(5,318	)		(2,219	)
Repurchases of common stock		(22,069	)		—			(50,000	)
Net cash (used in) provided by financing activities		(159,028	)		397,121			(58,230	)
Foreign currency exchange effect on cash, cash    equivalents and restricted cash balances		(5,061	)		16,089			(1,937	)
Increase (decrease) in cash, cash equivalents and restricted cash		36,848			(98,501	)		14,725
Cash, cash equivalents and restricted cash at beginning of year		107,445			205,946			191,221
Cash, cash equivalents and restricted cash at end of year	$	144,293		$	107,445		$	205,946

See accompanying notes to consolidated financial statements.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) Operations and Summary of Significant Accounting Policies

Description of Business

We empower organizations of all sizes with Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter. 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.  

Acquisitions

Effective August 1, 2018, we acquired Cardinal Solutions Group, Inc. (“Cardinal”), a digital solutions provider, for a purchase price, net of cash acquired, of approximately $78,800,000, including the final working capital adjustment and estimated tax adjustment to be paid in future periods.  The acquisition was funded using cash on hand.  

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.  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.

Our results of operations include the results of Cardinal, Caase.com, Datalink and Ignia from their respective acquisition dates.  (See Note 20 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)

Business Combinations

The Company accounts for all business combinations using the acquisition method of accounting, which allocates the fair value of the purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values.  The excess of the purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill.  When determining the fair values of assets acquired and liabilities assumed, management makes estimates and assumptions.  Initial purchase price allocations are subject to revision within the measurement period, not to exceed one year from the date of acquisition.  Acquisition-related expenses and transaction costs associated with business combinations are expensed as incurred.

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, Cash Equivalents and Restricted Cash

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.

Restricted cash generally includes any cash that is restricted as to withdrawal or usage.  These amounts are included with cash and cash equivalents on the consolidated statement of cash flows.  All cash receipts/payments with third parties directly to/from restricted cash accounts are reported as an operating, investing or financing cash flow, based on the nature of the transaction.

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.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 under previous accounting guidance, prior to Topic 606, these transactions did not meet the sales recognition criteria under GAAP.  Therefore, we did not record sales and the inventories were classified as inventories not available for sale on our consolidated balance sheet until the product was delivered.  If clients remitted payment before we delivered the product to them, then we recorded the payments received as deferred revenue on our consolidated balance sheet until such time as the product was delivered.  For additional information about our accounting policy related to these transactions after adopting Topic 606, see the Bill and Hold Transactions section of our Sales Recognition policy, below.

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 economic 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.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 would likely be used to assess the fair value of the reporting unit.  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 finite lived intangible assets acquired in business combinations using the straight-line method over the estimated economic lives of the intangible assets from the date of acquisition.

We regularly perform reviews to determine if facts and circumstances exist which indicate that the economic 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.

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

We adopted ASU No. 2014-09, “Revenue from Contracts with Customers,” which created FASB Topic 606 (“Topic 606”) with a date of initial application of January 1, 2018.  As a result, we changed our accounting policy for sales recognition as detailed below.  Revenue is measured based on the consideration specified in a contract with a client, and excludes any sales incentives and amounts collected on behalf of third parties.  The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product or service to a client.

Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a client, are excluded from revenue.  This is consistent with our accounting treatment prior to the adoption of Topic 606, whereby we reported sales net of any sales-based taxes assessed by governmental authorities that are imposed on and concurrent with sales transactions.

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We record the freight we bill to our clients as product net sales and the related freight costs we pay as product costs of goods sold.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Nature of Goods and Services

We sell hardware and software products on both a stand-alone basis without any services and as solutions bundled with services.

When we provide a combination of hardware and software products with the provision of services, we separately identify our performance obligations under our contract with the client as the distinct goods (hardware and/or software products) or services that will be provided.  The total transaction price for an arrangement with multiple performance obligations is allocated at contract inception to each distinct performance obligation in proportion to its stand-alone selling price.  The stand-alone selling price is the price at which we would sell a promised good or service separately to a client.  We estimate the price based on observable inputs, including direct labor hours and allocable costs, or use observable stand-alone prices when they are available.  

Product Offerings

Hardware

We recognize hardware product revenue at the point in time when a client takes control of the hardware, which typically occurs when title and risk of loss have passed to the client at its destination.  Our selling terms and conditions were modified during the fourth quarter of 2017 to specify F.O.B. destination contractual terms such that control is transferred from the Company at the point in time when the product is received by the client.  Prior to the adoption of Topic 606, because we either (i) had a general practice of covering client losses while products were in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) had specifically stated F.O.B. destination contractual terms with the client, delivery was not deemed to have occurred until the point in time when the product was received by the client.  The transaction price for hardware sales is adjusted 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 as the principal in the transaction when the product is received by the client because we control the product prior to transfer to the client.  We also assume primary responsibility for 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 and we work closely with our clients to determine their hardware specifications.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Bill and Hold Transactions

We offer a service to our customers whereby clients may purchase product that we procure on their behalf and, at our clients’ direction, store the product in our warehouse for a designated period of time, with the intention of deploying the product to the clients’ designated locations at a later date.  These warehousing services are designed to help our clients with inventory management challenges associated with technology roll-outs, product that is moving to end of life, and/or clients needing integrated stock available for immediate deployment.  In some circumstances, we may also perform lab integration services on a portion of the product prior to shipment to our clients for a separate fee.  The client is invoiced and title transfers to the client upon receipt of the product at our warehouse.  These product contracts are non-cancelable with customary credit terms beginning the date the product is received in our warehouse and the warranty periods begin on the date of invoice.  Revenue is recognized for the sale of the product to the client upon receipt of the product at our warehouse.  

The warehousing services and lab integration fees are considered separate performance obligations.  Under previous accounting guidance, prior to the adoption of Topic 606, it was determined that these product sales transactions did not meet the revenue recognition criteria under GAAP.  Therefore, we did not record product net sales, and the inventories were classified as inventories not available for sale on

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

our consolidated balance sheets, until the product was delivered to the clients’ designated location.  If clients remitted payment before we delivered the product to them, we recorded the payments received as deferred revenue on our consolidated balance sheets until such time as the product was delivered.

Software

We recognize revenue from software sales at the point in time when the client acquires the right to use or copy software under license and control transfers to the client.  For renewals, revenue is recognized upon the commencement of the term of the software license agreement or when the renewal term begins, as applicable.  This is a change from our accounting treatment prior to the adoption of Topic 606, whereby revenue from renewals of software licenses was recognized when the parties agreed to the renewal or extension, provided that all other revenue recognition criteria had been met.  

Although the revenue recognition treatment for term software license renewals has changed as described above, a substantial portion of the software licenses we sell are perpetual software licenses and do not require renewal or extension after their initial purchase by the client.  Such perpetual licenses are periodically subject to true-up, whereby additional perpetual licenses are sold under the client’s pre-existing master agreement.  Such true-ups are generally sold in arrears, and clients are invoiced for the additional licenses they had already been utilizing.  Since the client controlled these additional perpetual licenses prior to the true-up, software revenue related to the underlying additional licenses is recognized when we agree to the true-up with our client and the partner.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

For sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we changed our accounting to record the software license on a net basis, as the agent in the arrangement, given the predominant nature of the goods and services provided to the customer.  This is a change from our accounting treatment prior to the adoption of Topic 606, whereby we recorded the sale of these software products on a gross sales recognition basis.

Services Offerings

Software Maintenance

Software maintenance agreements provide our clients with the right to obtain any software upgrades, bug fixes and help desk and other support services directly from the software publisher at no additional charge during the term of the software maintenance agreements.  We act as the software publisher’s agent in selling these software maintenance agreements and do not assume any performance obligation to the client under the agreements.  As a result, we are the agent in these transactions and these sales are recorded on a net sales recognition basis.  Under net sales recognition, the cost of the software maintenance agreement 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.  Because we are acting as the software publisher’s agent, revenue is recognized when the parties agree to the initial purchase, renewal or extension as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.  

Cloud / Software-as-a-Service Offerings

Cloud or software-as-a-service subscription products provide our clients with access to software products hosted in the public cloud without the client taking possession of the software.  We act as the software publisher’s agent in selling these software-as-a service subscription products and do not host the software products on our servers.  We do not take control of the software products or assume any performance obligations to the clients related to the provisioning of the offerings in the cloud.  As a result, these sales are recorded on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.    

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Insight Delivered Services

We design, procure, deploy, implement and manage solutions that combine hardware, software and services to help businesses run smarter.  Such services are provided by us or third-party sub-contract vendors as part of bundled arrangements, or are provided separately on a stand-alone basis as technical, consulting or managed services engagements.  If the services are provided as part of a bundled arrangement with hardware and software, the hardware, software and services are generally distinct performance obligations.  In general, we recognize revenue from services engagements as we perform the underlying services and satisfy our performance obligations.

We recognize revenue from sales of services by measuring progress toward complete satisfaction of the related service performance obligation.  Billings for such services that are made in advance of the related revenue recognized are recorded as a contract liability.  

Specific revenue recognition practices for certain of our services offerings are described in further detail below.

Time and Materials Services Contracts  

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred for the performance completed to date for which we have the right to consideration, even if such amounts have not yet been invoiced as of period end.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  

Fixed Fee Services Contracts  

We recognize revenue on fixed fee professional services contracts using a proportional performance method of revenue recognition based on the ratio of direct labor and other allocated costs incurred to total estimated direct labor and other allocated costs.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

OneCall Support Services Contracts  

When we sell certain hardware and/or software products to our clients, we also enter into service contracts with them.  These contracts are support service agreements for the hardware and/or software products that were purchased from us.  Under certain support services contracts, although we purchase third-party support contracts for maintenance on the specific hardware or software products we have sold, our internal support desk assists the client first by performing an initial technical triage to determine the source of the problem and whether we can direct the client on how to fix the problem.  We refer to these services as “OneCall.”  We act as the principal in the transaction because we perform the OneCall services over the term of the support service contract and we set the price of the service charged to the client.  As a result, we recognize revenue from OneCall extended service contracts on a gross sales recognition basis ratably over the contract term of the stand ready obligation, generally one to three years.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

On our consolidated balance sheet, a significant portion of our contract liabilities balance relates to OneCall support services agreements for which clients have paid or have been invoiced but for which we have not yet recognized the applicable services revenue.  We also defer incremental direct costs to fulfill our service contracts that we prepay to third parties for direct support of our fulfillment of the service contract to our clients under our contract terms and amortize them into operations over the term of the contracts.  

Vendor Direct Support Services Contracts

When we do not provide OneCall services to the client on hardware and/or software products that were purchased, the client may purchase a vendor direct support services contract through us.  Under these contracts, our clients call the manufacturer/publisher or its designated service organization directly for both the initial technical triage and any follow-up assistance.  We act as the manufacturer/publisher’s agent in selling these support service contracts and do not assume any performance obligation to the client under the arrangements.  As a result, these sales are recorded on a net sales recognition basis similar to software maintenance agreements, as discussed above.  

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Because we are acting as the manufacturer/publisher’s agent, revenue is recognized when the parties agree to the purchase of the support services contract as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Third-party Provided Services  

A majority of our third-party sub-contractor services contracts are entered into in conjunction with other services contracts under which the services are performed by Insight teammates.  We have concluded that we control all services under the contract and can direct the third-party sub-contractor to provide the requested services.  As such, we act as the principal in the transaction and record the services under a gross sales recognition basis, with the selling price being recorded in sales and our cost to the third-party service provider being recorded in costs of goods sold.  For certain third-party service contracts in which we are not responsible for fulfillment of the services, we have concluded that we are an agent in the transaction and record revenue on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

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 for teammates who are not directly associated with delivering services, 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 $68,571,000, $53,227,000 and $48,114,000 in 2018, 2017 and 2016, 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, 2018.  We monitor our clients’ financial condition and do not require collateral.  No single client accounted for more than 4% of our consolidated net sales in 2018.  

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Supplier Risk

Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2018.  No other partner accounted for more than 10% of purchases in 2018.  Our top five partners as a group for 2018 were Microsoft, Cisco Systems, Tech Data (a distributor), HP Inc. and Ingram Micro (a distributor), and approximately 60% of our total purchases during 2018 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 $57,448,000, $47,053,000 and $37,565,000 was recorded in 2018, 2017 and 2016, 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).  Forfeitures are recognized as they occur.  

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.

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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,
	2018		2017		2016
Numerator:
Net earnings	$	163,677	$	90,683	$	84,690
Denominator:
Weighted-average shares used to compute basic    EPS		35,586		35,741		36,102
Dilutive potential common shares due to dilutive    RSUs, net of tax effect		423		466		336
Weighted-average shares used to compute    diluted EPS		36,009		36,207		36,438
Net earnings per share:
Basic	$	4.60	$	2.54	$	2.35
Diluted	$	4.55	$	2.50	$	2.32

In 2018, 2017 and 2016, approximately 17,000, 40,000 and 36,000, 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 August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2018-15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.”  The new standard requires that implementation costs incurred by customers in cloud computing arrangements are deferred if they would be capitalized by customers in software licensing arrangements under the internal-use software guidance.  The new standard is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted.  We adopted this new standard in the fourth quarter of 2018 and applied it retrospectively.  The adoption of this standard did not have a material effect on our consolidated financial statements.

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In July 2018, the FASB issued ASU No. 2018-09, “Codification Improvements,” which clarifies and corrects unintended application of guidance and makes improvement to Codification Topics.  There are various effective dates beginning with the ASU release date.  We adopted the standard in 2018.  The standard did not have a material effect on our consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.”  The new standard provides a new framework for determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.  The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted.  We adopted the standard in the first quarter of 2018.  The standard did not have a material effect on our consolidated financial statements.    

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 adopted the standard in the first quarter of 2018. The standard did not have a material effect on our consolidated financial statements.

As a result of the adoption of ASU No. 2016-18, we began including amounts generally described as restricted cash or restricted cash equivalents with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown in the statement of cash flows for the twelve months ended December 31, 2018.  Amounts shown in the consolidated statements of cash flows for the twelve months ended December 31, 2017 and 2016 were reclassified to conform to the current period presentation.  The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the years ended December 31, 2018, 2017 and 2016 (in thousands):

	December 31, 2018		December 31, 2017		December 31, 2016
Cash and cash equivalents	$	142,655	$	105,831	$	202,882
Restricted cash included in other current assets		8		46		51
Restricted cash included in other non-current assets		1,630		1,568		3,013
Total cash, cash equivalents and restricted cash    shown in the statement of cash flows	$	144,293	$	107,445	$	205,946

Amounts included in restricted cash represent those required to be set aside by a contractual agreement with a lessor related to certain leased office space in foreign jurisdictions.  Restricted cash shown in the statement of cash flows for the year ended December 31, 2017 also includes funds deposited with a financial institution in Australia to provide a guarantee on our behalf as security for any funds we might draw under our revolving loan facility in China.  The deposited funds were restricted in that we could not withdraw them as long as the related loan facility was in place.  These amounts were reported in other non-current assets.

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 adopted the new standard in the first quarter of 2018. The standard did not have a material effect on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which supersedes the existing lease recognition requirements in the current accounting standard for leases.  The core principal of the new standard is that an entity should recognize right-of-use (“ROU”) assets and lease liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative

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disclosures.  The new standard is to be applied using a modified retrospective transition method with the option to elect a number of practical expedients.  The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years.

In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842) – Targeted Improvements.” ASU 2018-11 provides additional guidance to Topic 842 including providing preparers an additional optional retrospective adoption method which allows entities to initially apply the new leases standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings. ASU 2018-11 also provides lessors a practical expedient to not separate lease from non-lease components, in certain situations.

We will adopt the new lease standard as of January 1, 2019 and plan to utilize the retrospective cumulative effect adjustment transition method with a cumulative effect adjustment being recorded as of the adoption date.  We expect to elect certain available practical expedients including the package of practical expedients permitted under the transition guidance within the new standard, which among other things, will allow us to carry forward the historical lease classification.  Additionally, we will make an accounting policy election to not record ROU assets and lease liabilities for leases with an initial term of twelve months or less on our consolidated balance sheet.  

We have established a cross-functional implementation team and are in the process of finalizing the scope of arrangements that will be subject to this standard as well as assessing the impact to our systems, processes, and internal controls over financial reporting.  While we are still evaluating the impact of adopting ASU No. 2016-02, we anticipate this standard will have a material impact on our other assets and other liabilities balances.  The primary impact will be to record ROU assets and lease liabilities for existing operating leases on our consolidated balance sheets.  Currently, we estimate adoption of the standard will result in recognition of additional ROU assets and lease liabilities of between approximately $70 million and $80 million, each, as of January 1, 2019.  

We do not expect the adoption to have a material impact on our consolidated statements of operations or our consolidated statements of cash flows.  We do not believe the standard will have a notable impact on our liquidity.  The standard will have no impact on our debt-covenant compliance under our current agreements.  Our analysis and evaluation of the new standard will continue through its effective date in the first quarter of 2019, including continuing to monitor any potential changes in the standard proposed by the FASB.  

In January 2016, the FASB issued 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 adopted the standard in the first quarter of 2018. 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.  We adopted the standard in the first quarter of 2018.  See Note 2 for further discussion.

(2) New Accounting Standard – Sales Recognition

We adopted ASU No. 2014-09, “Revenue from Contracts with Customers,” which created FASB Topic 606 (“Topic 606”) with a date of initial application of January 1, 2018.  Topic 606 also includes Subtopic 340-40, “Other Assets and Deferred Costs – Contracts with Customers,” which requires the deferral of incremental costs of obtaining a contract with a customer.  As a result, we changed our accounting policy for sales recognition and incremental costs of obtaining a contract with a customer as detailed below.

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We applied Topic 606 using the modified retrospective transition method.  In adopting the new standard, the net cumulative effect from prior periods of applying the guidance in Topic 606 was recognized as a cumulative effect adjustment to the opening balance of retained earnings in our consolidated balance sheet as of January 1, 2018.  Additionally, we have elected the option to only account for contracts that remained open as of the January 1, 2018 transition date in accordance with Topic 606.  Revenue recognition for contracts for which substantially all of the revenue was recognized in accordance with the revenue guidance in effect before January 1, 2018 has not been changed.  The comparative information as of December 31, 2017 and for the years ended December 31, 2017 and 2016 have not been adjusted and continue to be reported under the previously applicable accounting standards.  The details of the significant changes and quantitative impact of the changes are set forth below.

• For sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we changed our accounting to record both the software license and the accompanying software maintenance on a net basis, as the agent in the arrangement, given the predominant nature of the goods and services provided to the customer.  Under previous guidance, we bifurcated the sale of the software license from the sale of the maintenance contract, recorded the sale of the software product on a gross sales recognition basis and recorded the sale of the software maintenance on a net sales recognition basis.  This change has no effect on reported gross profit dollars associated with these transactions.

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

• The accounting for renewals of certain software term/usage licenses changed to delay or accelerate revenue recognition to the renewal period.  Under previous guidance, we recognized revenue as the renewal order was completed.

• The accounting for certain contracts with our clients that include payment terms that exceed one year changed such that we recognize revenue at the point in time when control of the product is transferred to the client or over the period of time that the service is provided to the client.  To the extent that a significant financing component exists in these arrangements, we will record interest income associated with the financing component of the arrangement over the payment terms of the arrangement.  Under previous guidance, we deferred revenue recognition under these contracts until payments became due as a result of the extended payment terms.

• The timing of revenue recognition for certain services contracts also changed to align with an appropriate input or output method.  For example, the timing of revenue recognition for certain services contracts with stated milestone terms changed to an earlier point in time when control transfers to the customer.  Under previous guidance, we recognized revenue based on the milestones stated in the contract with our customer.

• The accounting for recording sales returns allowance changed from being recorded against accounts receivable to being recorded as a refund liability.  As a result, in our consolidated balance sheets, we reclassified our sales returns allowance balance from accounts receivable, net to accrued expenses and other current liabilities.  Under previous guidance, we recorded the sales returns allowance in accounts receivable, net and not as a separately stated liability.  

• The accounting for sales commissions on contracts with performance periods that exceed one year changed such that we record such sales commissions as an asset and amortize them to expense over the related contract performance period.  Under previous guidance, sales commissions were expensed in the period the transaction was generated.

The total cumulative effect adjustment from prior periods that we recognized in our consolidated balance sheet as of January 1, 2018 as an adjustment to retained earnings was $7,176,000.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following tables summarize the effects of adopting Topic 606 on the Company’s consolidated financial statements as of December 31, 2018 (in thousands, except for per share data):

BALANCE SHEET AT DECEMBER 31, 2018

							Pre-Topic 606
	As Reported			Adjustments			Adoption
Cash and cash equivalents	$	142,655		$	—		$	142,655
Accounts receivable, net		1,931,736			(145,184	)		1,786,552
Inventories		148,503			—			148,503
Inventories not available for sale		—			118,936			118,936
Other current assets		115,683			39,684			155,367
Total current assets		2,338,577			13,436			2,352,013
Property and equipment, net		72,954			—			72,954
Goodwill		166,841			—			166,841
Intangible assets, net		112,179			—			112,179
Deferred income taxes		7,967			—			7,967
Other assets		77,429			(13,762	)		63,667
	$	2,775,947		$	(326	)	$	2,775,621
Accounts payable – trade	$	978,104		$	(84,504	)	$	893,600
Accounts payable – inventory financing facility		304,130			—			304,130
Accrued expenses and other current liabilities		190,733			(16,557	)		174,176
Current portion of long-term debt		1,395			—			1,395
Deferred revenue		62,300			121,526			183,826
Total current liabilities		1,536,662			20,465			1,557,127
Long-term debt		195,525			—			195,525
Deferred income taxes		683			—			683
Other liabilities		56,088			(11,443	)		44,645
		1,788,958			9,022			1,797,980
Stockholders’ equity:
Preferred stock		—			—			—
Common stock		355			—			355
Additional paid-in capital		323,622			—			323,622
Retained earnings		704,665			(9,311	)		695,354
Accumulated other comprehensive loss – foreign    currency translation adjustments		(41,653	)		(37	)		(41,690	)
Total stockholders’ equity		986,989			(9,348	)		977,641
	$	2,775,947		$	(326	)	$	2,775,621

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2018

						Pre-Topic 606
	As Reported		Adjustments			Adoption
Net sales:
Products	$	6,249,938	$	49,497		$	6,299,435
Services		830,198		(11,675	)		818,523
Total net sales		7,080,136		37,822			7,117,958
Costs of goods sold:
Products		5,711,400		39,616			5,751,016
Services		375,018		479			375,497
Total costs of goods sold		6,086,418		40,095			6,126,513
Gross profit		993,718		(2,273	)		991,445
Operating expenses:
Selling and administrative expenses		756,529		373			756,902
Severance and restructuring expenses		3,424		—			3,424
Acquisition-related expenses		282		—			282
Earnings from operations		233,483		(2,646	)		230,837
Non-operating expense, net		21,581		8			21,589
Earnings before income taxes		211,902		(2,654	)		209,248
Income tax expense		48,225		(519	)		47,706
Net earnings	$	163,677	$	(2,135	)	$	161,542
Net earnings per share:
Basic	$	4.60	$	(0.06	)	$	4.54
Diluted	$	4.55	$	(0.06	)	$	4.49
Shares used in per share calculations:
Basic		35,586		—			35,586
Diluted		36,009		—			36,009

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2018

The adoption of Topic 606 had no effect on net cash provided by operating activities, net cash used in investing activities or net cash used in financing activities for the year ended December 31, 2018.  The adjustment to net earnings noted above in reconciling our reported results of operations for the year ended December 31, 2018 under Topic 606 to pre-Topic 606 adoption was fully offset by adjustments to the reported changes in asset and liability balances, resulting in no effect on operating cash flows.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Disaggregation of Revenue

In the following table, revenue is disaggregated by our reportable operating segments, which are primarily defined bytheir related geographies, as well as by major product offering, by major client group and by recognition on either a gross basis as a principal in the arrangement, or on a net basis as an agent, for the year ended December 31, 2018 (in thousands):

	Year Ended December 31, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	3,610,356	$	653,499	$	29,496	$	4,293,351
Software		1,112,715		736,509		107,363		1,956,587
Services		639,910		140,233		50,055		830,198
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136
Major Client Groups
Large Enterprise / Corporate	$	3,951,900	$	1,134,696	$	49,826	$	5,136,422
Public Sector		498,873		327,818		76,567		903,258
Small and Medium-Sized Businesses		912,208		67,727		60,521		1,040,456
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	5,143,228	$	1,439,979	$	164,394	$	6,747,601
Net revenue recognition (Agent)		219,753		90,262		22,520		332,535
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136

Contract Balances

The following table provides information about receivables, contract assets and contract liabilities as of December 31, 2018 and January 1, 2018 (in thousands):

	December 31,		January 1,
	2018		2018
Current receivables, which are included in “Accounts    receivable, net”	$	1,931,736	$	1,909,074
Non-current receivables, which are included in “Other assets”		38,157		32,227
Contract assets, which are included in “Other current    assets”		892		595
Contract liabilities, which are included in “Deferred    revenue” and “Other liabilities”		82,117		86,743

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Significant changes in the contract assets and the contract liabilities balances during the year ended December 31, 2018 are as follows (in thousands):

	Increase (Decrease)
	Contract			Contract
	Assets			Liabilities
Balances at January 1, 2018	$	595		$	86,743
Reclassification of the beginning contract liabilities    to revenue, as the result of performance    obligations satisfied		—			(72,779	)
Cash received in advance and not recognized as    revenue		—			68,153
Reclassification of the beginning contract assets to   receivables, as the result of rights to consideration    becoming unconditional		(595	)		—
Contract assets recognized, net of reclassification to    receivables		892			—
Balances at December 31, 2018	$	892		$	82,117

Transaction price allocated to the remaining performance obligations

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2018 that are expected to be recognized in the future (in thousands):

	Products		Services		Total
2019		13		88,998		89,011
2020		5		28,906		28,911
2021		—		11,251		11,251
2022		—		4,413		4,413
2023		—		1,841		1,841
2024 and thereafter		—		376		376
Total remaining performance obligations	$	18	$	135,785	$	135,803

Topic 606 allows for certain practical expedients which we have elected to apply.  As a result, with the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, we do not disclose information about remaining performance obligations that have original expected durations of one year or less in the table above.  Amounts not included in the table above have an average original expected duration of eight months.  Additionally, for our time and material services contracts, whereby we have the right to consideration from a client in an amount that corresponds directly with the value to the client of our performance completed to date, we recognized revenue in the amount to which we have a right to invoice as of December 31, 2018 and do not disclose information about related remaining performance obligations in the table above.  Our time and material contracts have an average expected duration of 12 months.

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, therefore we do not include performance obligations under open cancelable purchase orders, which do not qualify for revenue recognition in accordance with Topic 606 as of December 31, 2018, in the table above.

Assets recognized for costs of obtaining a contract with a customer

We believe that the only significant incremental costs incurred to obtain contracts with our clients within the scope of Topic 606 are sales commissions.  The majority of our contracts are completed within a one-year performance period, and for contracts with a specified term of one year or less, we have exercised a practical expedient, which allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

have recognized is one year or less.  Under Topic 606, we record sales commissions on contracts with performance periods that exceed one year as an asset and amortize the asset to expense over the related contract performance period.  As of December 31, 2018, the related asset balance was $2,763,000, which we expect to recognize as expense over the next 36 months.  Under previous accounting standards, we recognized sales commissions as earned and recorded such amounts within selling and administrative expenses in our statements of operations.

(3) Property and Equipment

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

	December 31,
	2018			2017
Software	$	170,327		$	171,701
Buildings		64,263			65,468
Equipment		100,421			103,542
Furniture and fixtures		38,200			38,459
Leasehold improvements		26,319			25,981
Land		5,124			5,179
		404,654			410,330
Accumulated depreciation and amortization		(331,700	)		(335,078	)
Property and equipment, net	$	72,954		$	75,252

We periodically assess whether any indicators of impairment existed related to our property and equipment.  We incurred non-cash charges of $393,000 and $418,000 during 2018 and 2017, 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 $21,721,000, $25,787,000 and $27,493,000 in 2018, 2017 and 2016, respectively.  Interest charges capitalized in connection with internal-use software development projects in 2018, 2017 and 2016 were immaterial.  

(4) Goodwill

The changes in the carrying amount of goodwill for the year ended December 31, 2018 are as follows (in thousands):

	North America			EMEA			APAC			Consolidated
Goodwill	$	379,110		$	151,439		$	20,930		$	551,479
Accumulated impairment losses	$	(323,422	)	$	(151,439	)	$	(13,973	)	$	(488,834	)
Goodwill acquired during 2017		64,140			4,041			605			68,786
Balance at December 31, 2017		119,828			4,041			7,562			131,431
Goodwill acquired during 2018		36,440			(108	)		—			36,332
Foreign currency translation adjustment		—			(184	)		(738	)		(922	)
Balance at December 31, 2018	$	156,268		$	3,749		$	6,824		$	166,841

On August 1, 2018, we acquired Cardinal, which has been integrated into our North America business. Under the acquisition 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 $36,440,000 was recorded as goodwill in the North America reporting unit (see Note 20).  The primary driver for this acquisition was to strengthen our services capabilities and bring value to our clients within our digital innovation services solution offering.

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On September 26, 2017, we acquired Caase.com, which has been integrated into our EMEA business.  Under the acquisition 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 20).  The primary driver for this acquisition was to strengthen our ability to deliver cloud and data center solutions to our clients in the Netherlands, with a view to expand into the wider European region in the near future.  The change in goodwill in our EMEA operating segment as of December 31, 2018 compared to the balance as of December 31, 2017 resulted from a final balancing adjustment during the year and foreign currency translation adjustments associated with the goodwill balance.

On January 6, 2017, we acquired Datalink, which has been integrated into our North America business.  Under the acquisition 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 20).  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 acquisition 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 20).  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 digital innovation solutions to our clients in the Asia-Pacific region.  The change in goodwill as of December 31, 2017 compared to the balance as of December 31, 2016 resulted from a final working capital adjustment and foreign currency translation adjustments associated with the goodwill balance.  

During 2018, 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 2018.  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.

(5) Intangible Assets

Intangible assets consist of the following (in thousands):

	December 31,
	2018			2017
Customer relationships	$	159,566		$	133,660
Other		5,555			4,475
		165,121			138,135
Accumulated amortization		(52,942	)		(37,357	)
Intangible assets, net	$	112,179		$	100,778

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.

During 2018, 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.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Amortization expense recognized in2018, 2017 and2016was $15,737,000, $16,812,000 and$10,637,000, respectively.  

Future amortization expense for the remaining unamortized balance as of December 31, 2018 is estimated as follows (in thousands):

Years Ending December 31,	Amortization Expense
2019	$	14,602
2020		14,590
2021		14,429
2022		14,256
2023		13,831
Thereafter		40,471
Total amortization expense	$	112,179

(6) 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.    

Our inventory financing facility was amended on March 23, 2018 to increase the aggregate availability for vendor purchases under the facility from $325,000,000 to $400,000,000, of which $304,130,000 was outstanding at December 31, 2018.  In conjunction with the increase, we no longer have the option to request additional increases in the aggregate amount available under the inventory financing facility without amending the facility.  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); however, 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 $10,593,000, $6,736,000 and $3,385,000 was recorded in 2018, 2017 and 2016, 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.

(7) Debt, Capital Lease and Other Financing Obligations

Debt

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

	December 31,
	2018			2017
Senior revolving credit facility	$	—		$	117,500
Term Loan A (less unamortized debt issuance costs of $873 in    2017)		—			165,377
Accounts receivable securitization financing facility		194,000			25,000
Capital leases and other financing obligations		2,920			5,291
Total		196,920			313,168
Less: current portion of long-term debt		(1,395	)		(16,592	)
Long-term debt	$	195,525		$	296,576

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

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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, in connection with the acquisition of Datalink, we amended our revolving facility to expand the facility by $175,000,000 in the form of an incremental Term Loan A (“TLA”).  On December 7, 2018, we paid off the remaining balance of the TLA.  The revolving facility isguaranteed 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, 2018 was 3.66% per annum for the revolving facility.  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 2018, 2017 and 2016, due to availability under our accounts receivable securitization financing facility (“ABS facility”), weighted average borrowings under our revolving facility were $16,684,000, $63,604,000 and $35,811,000, respectively.  Interest expense associated with the revolving facility and TLA was $8,198,000, $8,491,000 and $2,191,000 in 2018, 2017 and 2016, respectively, including the commitment fee and amortization of deferred financing fees.  As of December 31, 2018, $350,000,000 was available under our revolving facility.  See discussion of the maximum leverage ratio under “Debt Covenants” below.  The revolving facility matures on June 23, 2021.

Our ABS facility was amended on June 27, 2018 to, among other things, renew the borrowing program for a three-year term expiring June 23, 2021.  The ABS facility has a maximum aggregate borrowing availability of $250,000,000.  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, 2018 and 2017, the SPE owned $1,101,597,000 and $1,141,520,000, 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, 2018, qualified receivables were sufficient to permit access to the full $250,000,000 facility amount, of which $194,000,000 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, 2018 was 3.46% 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, 2018, 2017 and 2016, 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 3.6%, 2.4% and 1.9%,  respectively.  Weighted average borrowings under our ABS facility in 2018, 2017 and 2016 were $98,663,000, $153,759,000 and $145,376,000, respectively.

Debt Covenants

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our revolving facility 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 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 is currently 3.25 times our trailing twelve-month adjusted earnings.  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, 2018, our aggregate debt balance that could have been outstanding under our revolving facility and our ABS facility was the full amount of the maximum borrowing capacity of $600,000,000, of which$194,000,000 was outstanding under our ABS facility at December 31, 2018.      

Capital Lease and Other Financing Obligations

In 2016 and 2017, we entered into capital leases with 36 to 40 month terms for certain IT equipment.  In October 2018, these capital leases were modified and the lease terms were extended to between 30 and 33 month terms.  The original capital leases and subsequent modifications were non-cash transactions and, accordingly, $977,000 has been excluded from our consolidated statements of cash flows for the years ended December 31, 2018 and 2017.  

Future minimum payments under the capitalized leases consist of the following as of December 31, 2018 (in thousands):

Years Ending December 31,
2019	$	1,488
2020		1,151
2021		432
Total minimum lease payments		3,071
Less amount representing interest		(151	)
Present value of minimum lease payments	$	2,920

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.  As of December 31, 2018 there were no amounts outstanding related to these financing obligations.  As of December 31, 2017, $2,489,000 was outstanding related to these financing obligations.  

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, 2018 and 2017.

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(8) 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 $20,114,000, $19,126,000 and $14,444,000 in 2018, 2017 and 2016, 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, 2018 are as follows (in thousands):

Years Ending December 31,
2019	$	21,499
2020		15,580
2021		12,121
2022		9,150
2023		6,296
Thereafter		7,238
Total minimum lease payments	$	71,884

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

(9) Severance and Restructuring Activities

During 2018, 2017 and 2016, 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 2018 and 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, 2018 related to these resource actions, and the outstanding obligations as of December 31, 2018 (in thousands):

	North America			EMEA			APAC			Consolidated
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
Severance costs, net of adjustments		1,617			1,677			130			3,424
Cash payments		(2,003	)		(3,386	)		(145	)		(5,534	)
Foreign currency translation adjustments		(41	)		(37	)		—			(78	)
Balances at December 31, 2018	$	1,204		$	1,248		$	—		$	2,452

Immaterial adjustments were recorded as a reduction to severance and restructuring expense in each of 2018, 2017 and 2016, due to changes in estimates.

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The remaining outstanding obligations as of December 31, 2018are expected to be paid during the next 12 months and are therefore included in accrued expenses and other current liabilities.

(10) 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,
	2018		2017		2016
North America	$	11,697	$	9,697	$	8,096
EMEA		3,170		2,737		2,530
APAC		488		392		432
Total Consolidated	$	15,355	$	12,826	$	11,058

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, 2018, of the 7,250,000shares of common stock reserved and available for grant under the Plan, 2,791,688shares 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.  

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of December 31, 2018, total compensation cost related to nonvested RSUs not yet recognized is $21,104,000, which is expected to be recognized over the next 1.31years on a weighted-average basis.

The following table summarizes our RSU activity during 2018:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at the beginning of year		892,113		$	32.86
Granted		557,823		$	36.79
Vested, including shares withheld to cover taxes		(383,672	)	$	29.80	$	14,302,223	(a)
Forfeited		(45,334	)	$	34.10
Nonvested at the end of year		1,020,930		$	36.10	$	41,602,898	(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 2017 and 2016 was $20,284,762 and $9,235,102, 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 $40.75as of December 31, 2018, 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, 2018, 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 2018, 2017 and 2016 of 88,638, 122,255 and 84,953, respectively, were based on the value of the RSUs on their vesting dates as determined by our closing stock price on such dates.  For 2018, 2017 and 2016, total payments for our teammates’ tax obligations to the taxing authorities were $3,230,000, $5,318,000 and $2,219,000, 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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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):

	Years Ended December 31,
	2018			2017			2016
Earnings before income taxes:
United States	$	145,907		$	119,330		$	99,095
Foreign		65,995			39,768			40,363
	$	211,902		$	159,098		$	139,458
Income tax expense:
Current:
U.S. Federal	$	18,334		$	31,067		$	27,947
U.S. State and local		3,218			3,636			2,200
Foreign		17,547			14,573			14,104
		39,099			49,276			44,251
Deferred:
U.S. Federal		8,123			20,327			10,395
U.S. State and local		1,142			(427	)		1,088
Foreign		(139	)		(761	)		(966	)
		9,126			19,139			10,517
	$	48,225		$	68,415		$	54,768

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):

	2018					2017					2016
Statutory federal income tax rate	$	44,499		21.0	%	$	55,684		35.0	%	$	48,810		35.0	%
State income tax expense, net of    federal income tax benefit		6,767		3.2			2,808		1.8			3,368		2.4
Audits and adjustments, net		2,659		1.3			(313	)	(0.2	)		(1,039	)	(0.7	)
Change in valuation allowances		60		—			2,472		1.5			3,742		2.7
Foreign income taxed at different rates		2,639		1.2			(6,057	)	(3.8	)		(6,611	)	(4.7	)
U.S. mandatory deemed repatriation		(1,396	)	(0.7	)		5,625		3.5			—		—
Adjustment of net deferred tax assets    for enacted U.S. federal tax reform		(4,198	)	(2.0	)		7,738		4.9			—		—
Research and development credits		(4,132	)	(1.9	)		—		—			—		—
Change in U.S. tax law applicable to    certain foreign entities		—		—			—		—			2,577		1.8
Non-deductible compensation		1,399		0.7			571		0.4			518		0.4
Other, net		(72	)	—			(113	)	(0.1	)		3,403		2.4
Effective tax rate	$	48,225		22.8	%	$	68,415		43.0	%	$	54,768		39.3	%

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 and the first nine months of 2018, we recorded provisional amounts for certain tax enactment-date effects of the new law by applying the guidance of SAB 118 because we had not yet completed our enactment-date accounting for these effects.  In 2017 and 2018, the company recorded tax expense and benefit, respectively, related to the new tax law that included remeasurement of U.S. deferred income taxes, the mandatory deemed repatriation provision and the state tax effects of these items.  The changes to 2017 provisional amounts resulted in a benefit of $5.6 million, which reduced our annual effective tax rate by 2.7% in 2018.  At December 31, 2018 the accounting for the enactment-date income tax effects for the new tax law are completed.

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U.S. federal tax reform subjects a U.S. corporation to tax on its global intangible low-taxed income (GILTI). U.S. GAAP allows companies to make an accounting policy election to either (1) treat taxes due on future GILTI inclusions in U.S. taxable income as a current-period expense when incurred (“period cost method”) or (2) factor such amounts into the measurement of its deferred taxes (“deferred method”). We have elected to use the period cost method.

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,
	2018			2017
Deferred tax assets:
Net operating losses	$	23,926		$	25,418
Foreign tax credits		16,800			21,346
Accruals		4,242			5,921
Stock-based compensation		3,173			3,023
Property and equipment		2,008			1,111
Accounts receivable		1,980			2,124
Goodwill and other intangibles		1,296			4,717
Deferred revenue		1,016			600
Inventories		133			1,930
Other		2,487			335
Gross deferred tax assets		57,061			66,525
Valuation allowances		(40,630	)		(45,995	)
Total deferred tax assets		16,431			20,530
Deferred tax liabilities:
Inventories		(4,885	)		—
Accrued withholding tax		(1,303	)		(1,452	)
Goodwill and other intangibles		(1,202	)		(1,587	)
Other		(1,757	)		(1,144	)
Total deferred tax liabilities		(9,147	)		(4,183	)
Net deferred tax assets	$	7,284		$	16,347

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

	December 31,
	2018			2017
Net non-current deferred tax assets	$	7,967		$	17,064
Net non-current deferred tax liabilities		(683	)		(717	)
Net deferred tax assets	$	7,284		$	16,347

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of December 31, 2018, we have a federal net operating loss carryforward (“NOL”) of $252,000 and U.S. state NOLs of $1,403,000 that will expire between 2019 and 2037.  We also have NOLs from various non-U.S. jurisdictions of $84,266,000.  While the majority of the non-U.S. NOLs have no expiration date, $5,329,000 will expire between 2019 and 2025.  

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, 2018 and 2017, our valuation allowances totaled $40,630,000 and $45,995,000, 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,
	2018			2017
Valuation allowances at beginning of year	$	45,995		$	30,972
Increase in income tax expense		60			2,472
U.S. federal tax reform		(1,589	)		11,623
Foreign currency translation adjustments		(1,180	)		2,865
Other		(2,656	)		(1,937	)
Valuation allowances at end of year	$	40,630		$	45,995

The change 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, 2018 and 2017, we had approximately $6,849,000 and $4,273,000, respectively, of unrecognized tax benefits.  Of these amounts, approximately $313,000 and $287,000, 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, 2017	$	3,986
Additions for tax positions in prior periods		1,613
Additions for tax positions in current period		2,014
Subtractions due to foreign currency translation		(8	)
Subtractions due to audit settlements and statute expirations		(1,069	)
Balance at December 31, 2018	$	6,536

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 2017.  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

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

reasonably possible outcomes cannot be made at this time, but the estimated effect onour 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, 2017 and 2018 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 no amounts outstanding under our revolving facility and TLA and $194,000,000 outstanding under our ABS facility at December 31, 2018.  The interest rate attributable to the borrowings under our revolving facility and our ABS facility was 3.66%and 3.46%, respectively, per annum at December 31, 2018.  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.

(13) 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

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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, 2018, 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.

(14) 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 $15,216,000, $14,083,000 and $7,684,000 for 2018, 2017 and 2016, respectively.

(15) Share Repurchase Programs

In each of February 2018 and February 2016, our Board of Directors authorized share repurchase programs of $50,000,000.  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, 2018, 2017 and 2016, respectively, in thousands, except per share amounts:

Year	Total Number of Shares Purchased		Average Price Paid per Share		Approximate Dollar Value of Shares Purchased
2018		641	$	34.42	$	22,069
2017		—		—		—
2016		1,891		26.43		50,000
Total		2,532			$	72,069

All shares repurchased were retired.

(16) 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, 2018, we had approximately $3,725,000 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, 2018.  Accordingly, we have not accrued any liabilities related to such performance bonds in our consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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, 2018.  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.

(17) Supplemental Financial Information

Additions and deductions related to the allowance for doubtful accounts receivable for 2018, 2017 and 2016 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, 2018	$	10,158	$	4,776	$	(4,472	)	$	10,462
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

(18) Cash Flows

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

	Years Ended December 31,
	2018		2017		2016
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$	10,155	$	10,976	$	3,782
Cash paid during the year for income taxes, net of    refunds	$	31,218	$	55,470	$	39,051

Non-cash investing activities for 2018, 2017 and 2016 included $1,170,000, $159,000 and $791,000, respectively, of capital expenditures in accounts payable, representing additions purchased at period end but not yet paid for in cash.  

(19) 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.  

The following tables summarize net sales by offering for North America, EMEA and APAC by sales mix amounts (in thousands):

	North America
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	3,610,356	$	3,352,355	$	2,454,889
Software		1,112,715		1,310,118		1,146,808
Services		639,910		519,261		370,131
	$	5,362,981	$	5,181,734	$	3,971,828

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

	EMEA
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	653,499	$	536,500	$	481,505
Software		736,509		710,452		762,427
Services		140,233		108,464		94,628
	$	1,530,241	$	1,355,416	$	1,338,560

	APAC
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	29,496	$	27,907	$	18,916
Software		107,363		101,412		132,718
Services		50,055		37,154		23,493
	$	186,914	$	166,473	$	175,127

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 2018, 2017 or 2016.

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, 2018
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	4,723,071	$	1,390,008	$	136,859	$	6,249,938
Services		639,910		140,233		50,055		830,198
Total net sales		5,362,981		1,530,241		186,914		7,080,136
Costs of goods sold:
Products		4,313,070		1,273,422		124,908		5,711,400
Services		317,216		35,352		22,450		375,018
Total costs of goods sold		4,630,286		1,308,774		147,358		6,086,418
Gross profit		732,695		221,467		39,556		993,718
Operating expenses:
Selling and administrative expenses		545,091		182,470		28,968		756,529
Severance and restructuring expenses		1,617		1,677		130		3,424
Acquisition-related expenses		282		—		—		282
Earnings from operations	$	185,705	$	37,320	$	10,458	$	233,483

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

	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

	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

The following table is a summary of our total assets by reportable operating segment (in thousands):

	December 31, 2018			December 31, 2017
North America	$	2,660,886		$	2,337,573
EMEA		611,338			530,242
APAC		98,959			101,169
Corporate assets and intercompany eliminations, net		(595,236	)		(283,333	)
Total assets	$	2,775,947		$	2,685,651

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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
2018
Net sales	$	5,100,456	$	843,145	$	1,136,535	$	7,080,136
Total long-lived assets	$	52,346	$	12,434	$	8,174	$	72,954
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

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,
	2018		2017		2016
Depreciation and amortization of property and    equipment:
North America	$	17,164	$	20,241	$	21,952
EMEA		4,058		5,025		4,908
APAC		499		521		633
		21,721		25,787		27,493
Amortization of intangible assets:
North America		14,791		15,971		8,139
EMEA		285		73		1,951
APAC		661		768		547
		15,737		16,812		10,637
Total	$	37,458	$	42,599	$	38,130

(20) Acquisitions

Cardinal

Effective August 1, 2018, we acquired 100 percent of the issued and outstanding shares of Cardinal, a digital solutions provider based in Cincinnati, Ohio, with offices across the Midwest and Southeast United States, for a cash purchase price, net of cash acquired, of approximately $78,800,000, including working capital and estimated tax adjustments of $3,800,000.  Cardinal provides technology solutions to digitally transform organizations through their expertise in mobile applications development, Internet of Things and cloud enabled business intelligence.  We believe that this acquisition strengthens our services capabilities and will bring value to our clients within our digital innovation services solution offering.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The fair value of net assets acquired was approximately $42,360,000, including $27,540,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight line method over the estimated economic life of ten years.  The fair value of the customer relationships was determined using the multiple-period excess earnings method. The preliminary purchase price was allocated using the acquisition method of accounting using the information available at the time.  During the fourth quarter of 2018 we finalized the fair value assumptions for identifiable intangible assets with no changes being made to amounts previously recorded.  Goodwill acquired approximated $36,440,000 which was recorded in our North America operating segment.  The goodwill is tax deductible.The working capital adjustment was finalized in the fourth quarter of 2018.  We will finalize the purchase price allocation in 2019 when the final tax adjustment is completed and agreed upon.

We consolidated the results of operations for Cardinal within our North America operating segment beginning on August 1, 2018, the effective date of the acquisition.  Our historical results would not have been materially affected by the acquisition of Cardinal 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 statement of operations.  

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 cloud and data center 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 finalized the purchase price allocation in the third quarter of 2018 when the final working capital adjustment was agreed upon and paid and the evaluation of uncertain tax positions was 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.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 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
Net sales	As reported	$	6,703,623	$	5,485,515
	Proforma	$	6,707,533	$	6,084,484
Net earnings	As reported	$	90,683	$	84,690
	Proforma	$	92,276	$	85,823
Diluted earnings per share	As reported	$	2.50	$	2.32
	Proforma	$	2.55	$	2.36

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 digital innovation solutions 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 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.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(21) 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.  

(22) Selected Quarterly Financial Information (unaudited)

The following tables set forth selected unaudited consolidated quarterly financial information for 2018 and 2017 (in thousands, except per share data):

	Quarters Ended
	December 31, 2018			September 30, 2018			June 30, 2018 (1)			March 31, 2018 (1)
Net sales	$	1,749,046		$	1,747,726		$	1,840,870		$	1,742,494
Costs of goods sold		1,494,882			1,512,812			1,576,493			1,502,231
Gross profit		254,164			234,914			264,377			240,263
Operating expenses:
Selling and administrative expenses		194,790			184,095			189,464			188,180
Severance and restructuring expenses		715			683			382			1,644
Acquisition-related expenses		—			188			94			—
Earnings from operations		58,659			49,948			74,437			50,439
Non-operating (income) expense:
Interest income		(422	)		(330	)		(170	)		(153	)
Interest expense		5,563			6,132			5,102			6,015
Net foreign currency exchange (gain) loss		(1,517	)		539			(275	)		(245	)
Other expense, net		323			393			324			302
Earnings before income taxes		54,712			43,214			69,456			44,520
Income tax expense		7,671			11,060			17,977			11,517
Net earnings	$	47,041		$	32,154		$	51,479		$	33,003
Net earnings per share:
Basic	$	1.33		$	0.91		$	1.45		$	0.92
Diluted	$	1.31		$	0.89		$	1.44		$	0.91
Shares used in per share calculations:
Basic		35,480			35,468			35,483			35,913
Diluted		35,999			35,957			35,815			36,263

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

	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

(1) During the quarter ended September 30, 2018, we revised our previously issued March 31, 2018 and June 30, 2018 consolidated financial statements for immaterial errors identified.  The errors primarily relate to incorrect presentation of certain software revenue transactions.  The effect of the revision on our consolidated statements of operations for the three months ended March 31, 2018 was to reduce product net sales by $24,364,000, increase services net sales by $3,953,000, reduce product cost of goods sold by $23,749,000 and increase services cost of goods sold by $3,080,000.  For the three months ended March 31, 2018, gross profit, earnings from operations and net earnings increased by $258,000.  Diluted earnings per share for the three months ended March 31, 2018 increased $0.01.

The effect of the revision on our consolidated statement of operations for the three months ended June 30, 2018 was to reduce product net sales by $949,000, increase services net sales by $4,900,000, reduce product cost of goods sold by $532,000 and increase services cost of goods sold by $4,483,000.  The effect of the revision on our consolidated statement of operations for the six months ended June 30, 2018 was to reduce product net sales by $25,313,000, increase services net sales by $8,853,000, reduce product cost of goods sold by $24,281,000 and increase services cost of goods sold by $7,563,000.  For the three months ended June 30, 2018, there was no impact to gross profit, earnings from operations or net earnings resulting from the revision.  For the six months ended June 30, 2018, gross profit, earnings from operations and net earnings increased by $258,000.  There was no impact to diluted earnings per share in either the three or six months ended June 30, 2018.

These revisions are appropriately reflected in the consolidated statement of operations for the year ended December 31, 2018.  There is no impact to the audited consolidated financial statements for 2017, 2016 or any other prior period.

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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, 2018.  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, 2018, based on the criteria established in COSO’s Internal Control – Integrated Framework (2013).

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, 2018.

(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, 2018 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, 2018 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

Equity Awards under the Company’s 2007 Omnibus Plan.

On February 19, 2019, the Company’s Compensation Committee approved an increase in the 2019 annual target award of restricted stock units (“RSUs”) under the Company’s long-term equity-based incentive program for Kenneth T. Lamneck, Chief Executive Officer of the Company, from a value of $2,400,000 to $3,750,000.  Consistent with the Company’s equity plan structure for executive officers, and grants in prior years, the RSUs are (i) 60% performance-based and vest pro rata over three years and (ii) 40% service-based and vest pro rata over four years.  On February 19, 2019, the Compensation Committee also approved additional RSU awards, with a value of $1,000,000, to each of Glynis Bryan, Chief Financial Officer, Steven W. Dodenhoff, President, Insight North America, and Wolfgang Ebermann, President, EMEA.  These awards were granted in connection with the implementation of the Company’s strategic plan, are all service-based and vest pro rata over four years.  All of the RSUs described above were, or will be, granted under the Company’s 2007 Omnibus Plan.

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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 2019 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.

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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 is incorporated herein by reference as the list of exhibits required as part of this report.

Item 16.  Form 10-K Summary

None.

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EXHIBITS TO FORM 10-K

YEAR ENDED DECEMBER 31, 2018

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
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 Rachael A. Bertrandt, dated as of September 30, 2018	10-Q	000-25092	10.1	November 7, 2018

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EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2018

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
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
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

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EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2018

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
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
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

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EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2018

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
10.36	Third Omnibus Amendment to Loan Documents and Reaffirmation Agreement, dated as of March 23, 2018, by and among Calence, LLC, Insight Direct USA, Inc. and Insight Public Sector, Inc., as Resellers, the guarantors party thereto, Wells Fargo Capital Finance, LLC, as collateral agent, syndication agent and administrative agent, and the lenders party thereto	8-K	000-25092	10.1	March 30, 2018
10.37	Amendment No. 2 to Fourth Amended and Restated Credit Agreement, dated as of March 13, 2018, by and among Insight Enterprises, Inc., Insight Enterprises B.V., Insight Direct (UK), Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto	8-K	000-25092	10.2	March 30, 2018

99

INSIGHT ENTERPRISES, INC.

EXHIBITS TO FORM 10-K (continued)

YEAR ENDED DECEMBER 31, 2018

Commission File No. 000-25092

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing/Effective Date	Filed Herewith
10.38	Omnibus Amendment, dated as of June 27, 2018, among Insight Receivables, LLC, Insight Direct USA, Inc., Insight Public Sector, Inc., Insight Enterprises, Inc., the purchasers and managing agents party thereto and Wells Fargo Bank, National Association, as Agent, relating to the Receivables Purchase Agreement, dated as of December 31, 2002, as amended, and the Amended and Restated Receivables Sale Agreement, dated as of September 3, 2003, as amended	8-K	000-25092	10.1	June 29, 2018
21	Subsidiaries of Insight Enterprises, Inc.					X
23.1	Consent of KPMG LLP					X
24.1	Power of Attorney for Timothy A. Crown dated February 13, 2019					X
24.2	Power of Attorney for Richard E. Allen dated February 13, 2019					X
24.3	Power of Attorney for Bruce W. Armstrong dated February 13, 2019					X
24.4	Power of Attorney for Linda M. Breard dated February 13, 2019					X
24.5	Power of Attorney for Catherine Courage dated February 13, 2019					X
24.6	Power of Attorney for Anthony A. Ibargüen dated February 13, 2019					X
24.7	Power of Attorney for Kathleen S. Pushor dated February 13, 2019					X
24.8	Power of Attorney for Girish Rishi dated February 4, 2019					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, Rachael A. Bertrandt, Linda Breard, Glynis A. Bryan, Catherine Courage, Samuel C. Cowley, Timothy A. Crown, Steven W. Dodenhoff, Wolfgang Ebermann, Michael P. Guggemos, Anthony A. Ibargüen, Helen K. Johnson, Kenneth T. Lamneck, 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.

100

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 22, 2019

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
	President, Chief Executive Officer
/s/ Kenneth T. Lamneck	and Director (principal executive	February 22, 2019
Kenneth T. Lamneck	officer)
/s/ Glynis A. Bryan	Chief Financial Officer	February 22, 2019
Glynis A. Bryan	(principal financial officer)
/s/ Rachael A. Bertrandt	Global Corporate Controller	February 22, 2019
Rachael A. Bertrandt	(principal accounting officer)
/s/ Timothy A. Crown*	Chairman of the Board	February 13, 2019
Timothy A. Crown
/s/ Richard E. Allen*	Director	February 13, 2019
Richard E. Allen
/s/ Bruce W. Armstrong*	Director	February 13, 2019
Bruce W. Armstrong
/s/ Linda M. Breard*	Director	February 13, 2019
Linda Breard
/s/ Catherine Courage*	Director	February 13, 2019
Catherine Courage
/s/ Anthony A. Ibargüen*	Director	February 13, 2019
Anthony A. Ibargüen
/s/ Kathleen S. Pushor*	Director	February 13, 2019
Kathleen S. Pushor
/s/ Girish Rishi*	Director	February 4, 2019
Girish Rishi
* By:   /s/ Samuel C. Cowley
Samuel C. Cowley, Attorney in Fact

101

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
Cardinal Solutions Group, Inc.	Ohio
Cardinal Solutions Group-Florida, LLC	Florida
Cardinal Solutions Group-Georgia, LLC	Georgia
Cardinal Solutions Group-North Carolina, LLC	North Carolina
Cardinal Solutions Group-Tennessee, LLC	Tennessee
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, Inc.	Belgium
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 22, 2019, with respect to the consolidated balance sheets of Insight Enterprises, Inc. and subsidiaries as of December 31, 2018 and 2017, 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, 2018, and the related notes (collectively, the “consolidated financial statements”), and the effectiveness of internal control over financial reporting as of December 31, 2018, which reports appear in the December 31, 2018 annual report on Form 10‑K of Insight Enterprises, Inc.

Our report dated February 22, 2109 refers to a change in the Company’s method of accounting for revenue in 2018 due to the adoption of the FASB’s Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers.

/s/ KPMG LLP

Phoenix, Arizona
February 22, 2019

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, 2018 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, 2019.

/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, 2018, 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, 2019.

/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, 2018, 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, 2019.

/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, 2018, 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, 2019.

/s/ Linda M. Breard

Linda M. 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, 2018, 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, 2019.

/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, 2018, 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, 2019.

/s/ Anthony A. Ibarguen

Anthony A. Ibargüen

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 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, 2018, 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, 2019.

/s/ Kathleen S. Pushor

Kathleen S. Pushor

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 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, 2018, 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 4^th day of February, 2019.

/s/ Girish Rishi

Girish Rishi

EX-31.1

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 22, 2019
By:	/s/ Kenneth T. Lamneck
	Kenneth T. Lamneck
	Chief Executive Officer

EX-31.2

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 22, 2019
By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer

EX-32.1

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, 2018 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 22, 2019
By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer
	February 22, 2019

XML

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2018	Feb. 15, 2019	Jun. 29, 2018
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2018
Document Fiscal Year Focus	2018
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 Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		35,502,671
Entity Public Float			$ 1,710,394,927

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 142,655	$ 105,831
Accounts receivable, net	1,931,736	1,814,560
Inventories	148,503	194,529
Inventories not available for sale		36,956
Other current assets	115,683	152,467
Total current assets	2,338,577	2,304,343
Property and equipment, net	72,954	75,252
Goodwill	166,841	131,431
Intangible assets, net	112,179	100,778
Deferred income taxes	7,967	17,064
Other assets	77,429	56,783
Total assets	2,775,947	2,685,651
Current liabilities:
Accounts payable—trade	978,104	899,075
Accounts payable—inventory financing facility	304,130	319,468
Accrued expenses and other current liabilities	190,733	175,860
Current portion of long-term debt	1,395	16,592
Deferred revenue	62,300	88,979
Total current liabilities	1,536,662	1,499,974
Long-term debt	195,525	296,576
Deferred income taxes	683	717
Other liabilities	56,088	44,915
Total liabilities	1,788,958	1,842,182
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; 35,482 and 35,829 shares issued and outstanding, respectively	355	358
Additional paid-in capital	323,622	317,155
Retained earnings	704,665	550,220
Accumulated other comprehensive loss – foreign currency translation adjustments	(41,653)	(24,264)
Total stockholders’ equity	986,989	843,469
Total liabilities and stockholders' equity	$ 2,775,947	$ 2,685,651

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2018	Dec. 31, 2017
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	35,482,000	35,829,000
Common stock, shares outstanding	35,482,000	35,829,000

XML

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Net sales:
Total net sales	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Costs of goods sold:
Total costs of goods sold	1,494,882	1,512,812	1,576,493	1,502,231	1,551,192	1,531,892	1,432,653	1,269,316	6,086,418	5,785,053	4,742,413
Gross profit	254,164	234,914	264,377	240,263	232,883	226,081	251,379	208,227	993,718	918,570	743,102
Operating expenses:
Selling and administrative expenses	194,790	184,095	189,464	188,180	184,554	180,390	180,752	177,632	756,529	723,328	585,243
Severance and restructuring expenses	715	683	382	1,644	2,791	494	1,022	4,695	3,424	9,002	4,580
Loss on sale of foreign entity						3,646				3,646
Acquisition-related expenses		188	94			106	276	2,947	282	3,329	4,447
Earnings from operations	58,659	49,948	74,437	50,439	45,538	41,445	69,329	22,953	233,483	179,265	148,832
Non-operating (income) expense:
Interest income	(422)	(330)	(170)	(153)	(346)	(227)	(205)	(431)	(1,075)	(1,209)	(1,066)
Interest expense	5,563	6,132	5,102	6,015	5,360	5,555	4,326	3,933	22,812	19,174	8,628
Net foreign currency exchange (gain) loss	(1,517)	539	(275)	(245)	(117)	341	251	380	(1,498)	855	522
Other expense, net	323	393	324	302	367	339	326	315	1,342	1,347	1,290
Earnings before income taxes	54,712	43,214	69,456	44,520	40,274	35,437	64,631	18,756	211,902	159,098	139,458
Income tax expense	7,671	11,060	17,977	11,517	26,106	13,025	24,376	4,908	48,225	68,415	54,768
Net earnings	$ 47,041	$ 32,154	$ 51,479	$ 33,003	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 163,677	$ 90,683	$ 84,690
Net earnings per share:
Basic	$ 1.33	$ 0.91	$ 1.45	$ 0.92	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 4.60	$ 2.54	$ 2.35
Diluted	$ 1.31	$ 0.89	$ 1.44	$ 0.91	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 4.55	$ 2.50	$ 2.32
Shares used in per share calculations:
Basic	35,480	35,468	35,483	35,913	35,809	35,787	35,765	35,602	35,586	35,741	36,102
Diluted	35,999	35,957	35,815	36,263	36,272	36,203	36,169	36,185	36,009	36,207	36,438
Products [Member]
Net sales:
Total net sales									$ 6,249,938	$ 6,038,744	$ 4,997,263
Costs of goods sold:
Total costs of goods sold									5,711,400	5,512,402	4,571,462
Services [Member]
Net sales:
Total net sales									830,198	664,879	488,252
Costs of goods sold:
Total costs of goods sold									$ 375,018	$ 272,651	$ 170,951

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Statement Of Income And Comprehensive Income [Abstract]
Net earnings	$ 163,677	$ 90,683	$ 84,690
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(17,389)	31,835	(16,063)
Total comprehensive income	$ 146,288	$ 122,518	$ 68,627

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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, 2015	$ 685,742	$ 371		$ 316,686	$ (40,036)	$ 408,721
Beginning 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
Cumulative effect of accounting change	7,176					7,176
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(3,230)	$ 3		(3,233)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		345
Stock-based compensation expense	15,355			15,355
Repurchase of treasury stock, Amount	(22,069)		$ (22,069)
Repurchase of treasury stock, Shares			(641)
Retirement of treasury stock, Amount		$ (6)	$ 22,069	(5,655)		(16,408)
Retirement of treasury stock, Shares		(641)	641
Foreign currency translation adjustments, net of tax	(17,389)				(17,389)
Net earnings	163,677					163,677
Ending Balance at Dec. 31, 2018	$ 986,989	$ 355		$ 323,622	$ (41,653)	$ 704,665
Ending Balance, Shares at Dec. 31, 2018		35,482

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Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash flows from operating activities:
Net earnings	$ 163,677,000	$ 90,683,000	$ 84,690,000
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization of property and equipment	21,721,000	25,787,000	27,493,000
Amortization of intangible assets	15,737,000	16,812,000	10,637,000
Provision for losses on accounts receivable	4,776,000	5,245,000	2,452,000
Write-downs of inventories	2,912,000	2,776,000	2,934,000
Write-off of property and equipment	393,000	418,000	0
Non-cash stock-based compensation	15,355,000	12,826,000	11,058,000
Deferred income taxes	9,126,000	19,139,000	10,517,000
Loss on sale of foreign entity		3,646,000
Loss on extinguishment of debt	624,000
Gain on sale of real estate			(338,000)
Changes in assets and liabilities:
Increase in accounts receivable	(46,883,000)	(208,065,000)	(168,966,000)
Decrease (increase) in inventories	46,534,000	(14,046,000)	(50,712,000)
Decrease (increase) in other assets	12,424,000	3,342,000	(50,181,000)
Increase (decrease) in accounts payable	29,844,000	(237,457,000)	193,582,000
Increase (decrease) in deferred revenue	9,178,000	(27,184,000)	10,633,000
Increase (decrease) in accrued expenses and other liabilities	7,229,000	(988,000)	12,278,000
Net cash provided by (used in) operating activities	292,647,000	(307,066,000)	96,077,000
Cash flows from investing activities:
Acquisitions, net of cash and cash equivalents acquired	(74,938,000)	(186,932,000)	(10,297,000)
Purchases of property and equipment	(17,251,000)	(19,230,000)	(12,266,000)
Proceeds from sale of foreign entity	479,000	1,517,000
Proceeds from sale of real estate			1,378,000
Net cash used in investing activities	(91,710,000)	(204,645,000)	(21,185,000)
Cash flows from financing activities:
Borrowings on senior revolving credit facility	569,232,000	1,151,216,000	772,218,000
Repayments on senior revolving credit facility	(686,732,000)	(1,033,716,000)	(772,218,000)
Borrowings on accounts receivable securitization financing facility	3,357,000,000	3,961,389,000	2,802,000,000
Repayments on accounts receivable securitization financing facility	(3,188,000,000)	(3,975,889,000)	(2,851,500,000)
Borrowings under Term Loan A		175,000,000
Repayments under Term Loan A	(166,250,000)	(8,750,000)
Repayments under other financing agreements	(2,372,000)	(5,636,000)	(1,309,000)
Payments on capital lease obligations	(999,000)	(1,089,000)	(445,000)
Net (repayments) borrowings under inventory financing facility	(15,338,000)	141,037,000	48,603,000
Payment of debt issuance costs	(270,000)	(1,123,000)	(3,360,000)
Payment of payroll taxes on stock-based compensation through shares withheld	(3,230,000)	(5,318,000)	(2,219,000)
Repurchases of common stock	(22,069,000)		(50,000,000)
Net cash (used in) provided by financing activities	(159,028,000)	397,121,000	(58,230,000)
Foreign currency exchange effect on cash, cash equivalents and restricted cash balances	(5,061,000)	16,089,000	(1,937,000)
Increase (decrease) in cash, cash equivalents and restricted cash	36,848,000	(98,501,000)	14,725,000
Cash, cash equivalents and restricted cash at beginning of year	107,445,000	205,946,000	191,221,000
Cash, cash equivalents and restricted cash at end of year	$ 144,293,000	$ 107,445,000	$ 205,946,000

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Operations and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2018

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 empower organizations of all sizes with Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter. 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.  

Acquisitions

Effective August 1, 2018, we acquired Cardinal Solutions Group, Inc. (“Cardinal”), a digital solutions provider, for a purchase price, net of cash acquired, of approximately $78,800,000, including the final working capital adjustment and estimated tax adjustment to be paid in future periods.  The acquisition was funded using cash on hand.  

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.  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.

Our results of operations include the results of Cardinal, Caase.com, Datalink and Ignia from their respective acquisition dates.  (See Note 20 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.

Business Combinations

The Company accounts for all business combinations using the acquisition method of accounting, which allocates the fair value of the purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values.  The excess of the purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill.  When determining the fair values of assets acquired and liabilities assumed, management makes estimates and assumptions.  Initial purchase price allocations are subject to revision within the measurement period, not to exceed one year from the date of acquisition.  Acquisition-related expenses and transaction costs associated with business combinations are expensed as incurred.

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, Cash Equivalents and Restricted Cash

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.

Restricted cash generally includes any cash that is restricted as to withdrawal or usage.  These amounts are included with cash and cash equivalents on the consolidated statement of cash flows.  All cash receipts/payments with third parties directly to/from restricted cash accounts are reported as an operating, investing or financing cash flow, based on the nature of the transaction.

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 under previous accounting guidance, prior to Topic 606, these transactions did not meet the sales recognition criteria under GAAP.  Therefore, we did not record sales and the inventories were classified as inventories not available for sale on our consolidated balance sheet until the product was delivered.  If clients remitted payment before we delivered the product to them, then we recorded the payments received as deferred revenue on our consolidated balance sheet until such time as the product was delivered.  For additional information about our accounting policy related to these transactions after adopting Topic 606, see the Bill and Hold Transactions section of our Sales Recognition policy, below.

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 economic 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 would likely be used to assess the fair value of the reporting unit.  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 finite lived intangible assets acquired in business combinations using the straight-line method over the estimated economic lives of the intangible assets from the date of acquisition.

We regularly perform reviews to determine if facts and circumstances exist which indicate that the economic 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.

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

We adopted ASU No. 2014-09, “Revenue from Contracts with Customers,” which created FASB Topic 606 (“Topic 606”) with a date of initial application of January 1, 2018.  As a result, we changed our accounting policy for sales recognition as detailed below.  Revenue is measured based on the consideration specified in a contract with a client, and excludes any sales incentives and amounts collected on behalf of third parties.  The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product or service to a client.

Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a client, are excluded from revenue.  This is consistent with our accounting treatment prior to the adoption of Topic 606, whereby we reported sales net of any sales-based taxes assessed by governmental authorities that are imposed on and concurrent with sales transactions.

We record the freight we bill to our clients as product net sales and the related freight costs we pay as product costs of goods sold.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Nature of Goods and Services

We sell hardware and software products on both a stand-alone basis without any services and as solutions bundled with services.

When we provide a combination of hardware and software products with the provision of services, we separately identify our performance obligations under our contract with the client as the distinct goods (hardware and/or software products) or services that will be provided.  The total transaction price for an arrangement with multiple performance obligations is allocated at contract inception to each distinct performance obligation in proportion to its stand-alone selling price.  The stand-alone selling price is the price at which we would sell a promised good or service separately to a client.  We estimate the price based on observable inputs, including direct labor hours and allocable costs, or use observable stand-alone prices when they are available.  

Product Offerings

Hardware

We recognize hardware product revenue at the point in time when a client takes control of the hardware, which typically occurs when title and risk of loss have passed to the client at its destination.  Our selling terms and conditions were modified during the fourth quarter of 2017 to specify F.O.B. destination contractual terms such that control is transferred from the Company at the point in time when the product is received by the client.  Prior to the adoption of Topic 606, because we either (i) had a general practice of covering client losses while products were in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) had specifically stated F.O.B. destination contractual terms with the client, delivery was not deemed to have occurred until the point in time when the product was received by the client.  The transaction price for hardware sales is adjusted 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 as the principal in the transaction when the product is received by the client because we control the product prior to transfer to the client.  We also assume primary responsibility for 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 and we work closely with our clients to determine their hardware specifications.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Bill and Hold Transactions

We offer a service to our customers whereby clients may purchase product that we procure on their behalf and, at our clients’ direction, store the product in our warehouse for a designated period of time, with the intention of deploying the product to the clients’ designated locations at a later date.  These warehousing services are designed to help our clients with inventory management challenges associated with technology roll-outs, product that is moving to end of life, and/or clients needing integrated stock available for immediate deployment.  In some circumstances, we may also perform lab integration services on a portion of the product prior to shipment to our clients for a separate fee.  The client is invoiced and title transfers to the client upon receipt of the product at our warehouse.  These product contracts are non-cancelable with customary credit terms beginning the date the product is received in our warehouse and the warranty periods begin on the date of invoice.  Revenue is recognized for the sale of the product to the client upon receipt of the product at our warehouse.  

The warehousing services and lab integration fees are considered separate performance obligations.  Under previous accounting guidance, prior to the adoption of Topic 606, it was determined that these product sales transactions did not meet the revenue recognition criteria under GAAP.  Therefore, we did not record product net sales, and the inventories were classified as inventories not available for sale on our consolidated balance sheets, until the product was delivered to the clients’ designated location.  If clients remitted payment before we delivered the product to them, we recorded the payments received as deferred revenue on our consolidated balance sheets until such time as the product was delivered.

Software

We recognize revenue from software sales at the point in time when the client acquires the right to use or copy software under license and control transfers to the client.  For renewals, revenue is recognized upon the commencement of the term of the software license agreement or when the renewal term begins, as applicable.  This is a change from our accounting treatment prior to the adoption of Topic 606, whereby revenue from renewals of software licenses was recognized when the parties agreed to the renewal or extension, provided that all other revenue recognition criteria had been met.  

Although the revenue recognition treatment for term software license renewals has changed as described above, a substantial portion of the software licenses we sell are perpetual software licenses and do not require renewal or extension after their initial purchase by the client.  Such perpetual licenses are periodically subject to true-up, whereby additional perpetual licenses are sold under the client’s pre-existing master agreement.  Such true-ups are generally sold in arrears, and clients are invoiced for the additional licenses they had already been utilizing.  Since the client controlled these additional perpetual licenses prior to the true-up, software revenue related to the underlying additional licenses is recognized when we agree to the true-up with our client and the partner.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

For sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we changed our accounting to record the software license on a net basis, as the agent in the arrangement, given the predominant nature of the goods and services provided to the customer.  This is a change from our accounting treatment prior to the adoption of Topic 606, whereby we recorded the sale of these software products on a gross sales recognition basis.

Services Offerings

Software Maintenance

Software maintenance agreements provide our clients with the right to obtain any software upgrades, bug fixes and help desk and other support services directly from the software publisher at no additional charge during the term of the software maintenance agreements.  We act as the software publisher’s agent in selling these software maintenance agreements and do not assume any performance obligation to the client under the agreements.  As a result, we are the agent in these transactions and these sales are recorded on a net sales recognition basis.  Under net sales recognition, the cost of the software maintenance agreement 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.  Because we are acting as the software publisher’s agent, revenue is recognized when the parties agree to the initial purchase, renewal or extension as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.  

Cloud / Software-as-a-Service Offerings

Cloud or software-as-a-service subscription products provide our clients with access to software products hosted in the public cloud without the client taking possession of the software.  We act as the software publisher’s agent in selling these software-as-a service subscription products and do not host the software products on our servers.  We do not take control of the software products or assume any performance obligations to the clients related to the provisioning of the offerings in the cloud.  As a result, these sales are recorded on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.    

Insight Delivered Services

We design, procure, deploy, implement and manage solutions that combine hardware, software and services to help businesses run smarter.  Such services are provided by us or third-party sub-contract vendors as part of bundled arrangements, or are provided separately on a stand-alone basis as technical, consulting or managed services engagements.  If the services are provided as part of a bundled arrangement with hardware and software, the hardware, software and services are generally distinct performance obligations.  In general, we recognize revenue from services engagements as we perform the underlying services and satisfy our performance obligations.

We recognize revenue from sales of services by measuring progress toward complete satisfaction of the related service performance obligation.  Billings for such services that are made in advance of the related revenue recognized are recorded as a contract liability.  

Specific revenue recognition practices for certain of our services offerings are described in further detail below.

Time and Materials Services Contracts  

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred for the performance completed to date for which we have the right to consideration, even if such amounts have not yet been invoiced as of period end.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  

Fixed Fee Services Contracts  

We recognize revenue on fixed fee professional services contracts using a proportional performance method of revenue recognition based on the ratio of direct labor and other allocated costs incurred to total estimated direct labor and other allocated costs.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

OneCall Support Services Contracts  

When we sell certain hardware and/or software products to our clients, we also enter into service contracts with them.  These contracts are support service agreements for the hardware and/or software products that were purchased from us.  Under certain support services contracts, although we purchase third-party support contracts for maintenance on the specific hardware or software products we have sold, our internal support desk assists the client first by performing an initial technical triage to determine the source of the problem and whether we can direct the client on how to fix the problem.  We refer to these services as “OneCall.”  We act as the principal in the transaction because we perform the OneCall services over the term of the support service contract and we set the price of the service charged to the client.  As a result, we recognize revenue from OneCall extended service contracts on a gross sales recognition basis ratably over the contract term of the stand ready obligation, generally one to three years.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

On our consolidated balance sheet, a significant portion of our contract liabilities balance relates to OneCall support services agreements for which clients have paid or have been invoiced but for which we have not yet recognized the applicable services revenue.  We also defer incremental direct costs to fulfill our service contracts that we prepay to third parties for direct support of our fulfillment of the service contract to our clients under our contract terms and amortize them into operations over the term of the contracts.  

Vendor Direct Support Services Contracts

When we do not provide OneCall services to the client on hardware and/or software products that were purchased, the client may purchase a vendor direct support services contract through us.  Under these contracts, our clients call the manufacturer/publisher or its designated service organization directly for both the initial technical triage and any follow-up assistance.  We act as the manufacturer/publisher’s agent in selling these support service contracts and do not assume any performance obligation to the client under the arrangements.  As a result, these sales are recorded on a net sales recognition basis similar to software maintenance agreements, as discussed above.  Because we are acting as the manufacturer/publisher’s agent, revenue is recognized when the parties agree to the purchase of the support services contract as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Third-party Provided Services  

A majority of our third-party sub-contractor services contracts are entered into in conjunction with other services contracts under which the services are performed by Insight teammates.  We have concluded that we control all services under the contract and can direct the third-party sub-contractor to provide the requested services.  As such, we act as the principal in the transaction and record the services under a gross sales recognition basis, with the selling price being recorded in sales and our cost to the third-party service provider being recorded in costs of goods sold.  For certain third-party service contracts in which we are not responsible for fulfillment of the services, we have concluded that we are an agent in the transaction and record revenue on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

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 for teammates who are not directly associated with delivering services, 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 $68,571,000, $53,227,000 and $48,114,000 in 2018, 2017 and 2016, 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, 2018.  We monitor our clients’ financial condition and do not require collateral.  No single client accounted for more than 4% of our consolidated net sales in 2018.  

Supplier Risk

Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2018.  No other partner accounted for more than 10% of purchases in 2018.  Our top five partners as a group for 2018 were Microsoft, Cisco Systems, Tech Data (a distributor), HP Inc. and Ingram Micro (a distributor), and approximately 60% of our total purchases during 2018 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 $57,448,000, $47,053,000 and $37,565,000 was recorded in 2018, 2017 and 2016, 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).  Forfeitures are recognized as they occur.  

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,
	2018		2017		2016
Numerator:
Net earnings	$	163,677	$	90,683	$	84,690
Denominator:
Weighted-average shares used to compute basic    EPS		35,586		35,741		36,102
Dilutive potential common shares due to dilutive    RSUs, net of tax effect		423		466		336
Weighted-average shares used to compute    diluted EPS		36,009		36,207		36,438
Net earnings per share:
Basic	$	4.60	$	2.54	$	2.35
Diluted	$	4.55	$	2.50	$	2.32

In 2018, 2017 and 2016, approximately 17,000, 40,000 and 36,000, 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 August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2018-15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.”  The new standard requires that implementation costs incurred by customers in cloud computing arrangements are deferred if they would be capitalized by customers in software licensing arrangements under the internal-use software guidance.  The new standard is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted.  We adopted this new standard in the fourth quarter of 2018 and applied it retrospectively.  The adoption of this standard did not have a material effect on our consolidated financial statements.

In July 2018, the FASB issued ASU No. 2018-09, “Codification Improvements,” which clarifies and corrects unintended application of guidance and makes improvement to Codification Topics.  There are various effective dates beginning with the ASU release date.  We adopted the standard in 2018.  The standard did not have a material effect on our consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.”  The new standard provides a new framework for determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.  The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted.  We adopted the standard in the first quarter of 2018.  The standard did not have a material effect on our consolidated financial statements.    

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 adopted the standard in the first quarter of 2018. The standard did not have a material effect on our consolidated financial statements.

As a result of the adoption of ASU No. 2016-18, we began including amounts generally described as restricted cash or restricted cash equivalents with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown in the statement of cash flows for the twelve months ended December 31, 2018.  Amounts shown in the consolidated statements of cash flows for the twelve months ended December 31, 2017 and 2016 were reclassified to conform to the current period presentation.  The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the years ended December 31, 2018, 2017 and 2016 (in thousands):

	December 31, 2018		December 31, 2017		December 31, 2016
Cash and cash equivalents	$	142,655	$	105,831	$	202,882
Restricted cash included in other current assets		8		46		51
Restricted cash included in other non-current assets		1,630		1,568		3,013
Total cash, cash equivalents and restricted cash    shown in the statement of cash flows	$	144,293	$	107,445	$	205,946

Amounts included in restricted cash represent those required to be set aside by a contractual agreement with a lessor related to certain leased office space in foreign jurisdictions.  Restricted cash shown in the statement of cash flows for the year ended December 31, 2017 also includes funds deposited with a financial institution in Australia to provide a guarantee on our behalf as security for any funds we might draw under our revolving loan facility in China.  The deposited funds were restricted in that we could not withdraw them as long as the related loan facility was in place.  These amounts were reported in other non-current assets.

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 adopted the new standard in the first quarter of 2018. The standard did not have a material effect on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which supersedes the existing lease recognition requirements in the current accounting standard for leases.  The core principal of the new standard is that an entity should recognize right-of-use (“ROU”) assets and lease liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures.  The new standard is to be applied using a modified retrospective transition method with the option to elect a number of practical expedients.  The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years.

In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842) – Targeted Improvements.” ASU 2018-11 provides additional guidance to Topic 842 including providing preparers an additional optional retrospective adoption method which allows entities to initially apply the new leases standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings. ASU 2018-11 also provides lessors a practical expedient to not separate lease from non-lease components, in certain situations.

We will adopt the new lease standard as of January 1, 2019 and plan to utilize the retrospective cumulative effect adjustment transition method with a cumulative effect adjustment being recorded as of the adoption date.  We expect to elect certain available practical expedients including the package of practical expedients permitted under the transition guidance within the new standard, which among other things, will allow us to carry forward the historical lease classification.  Additionally, we will make an accounting policy election to not record ROU assets and lease liabilities for leases with an initial term of twelve months or less on our consolidated balance sheet.  

We have established a cross-functional implementation team and are in the process of finalizing the scope of arrangements that will be subject to this standard as well as assessing the impact to our systems, processes, and internal controls over financial reporting.  While we are still evaluating the impact of adopting ASU No. 2016-02, we anticipate this standard will have a material impact on our other assets and other liabilities balances.  The primary impact will be to record ROU assets and lease liabilities for existing operating leases on our consolidated balance sheets.  Currently, we estimate adoption of the standard will result in recognition of additional ROU assets and lease liabilities of between approximately $70 million and $80 million, each, as of January 1, 2019.  

We do not expect the adoption to have a material impact on our consolidated statements of operations or our consolidated statements of cash flows.  We do not believe the standard will have a notable impact on our liquidity.  The standard will have no impact on our debt-covenant compliance under our current agreements.  Our analysis and evaluation of the new standard will continue through its effective date in the first quarter of 2019, including continuing to monitor any potential changes in the standard proposed by the FASB.  

In January 2016, the FASB issued 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 adopted the standard in the first quarter of 2018. 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.  We adopted the standard in the first quarter of 2018.  See Note 2 for further discussion.

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New Accounting Standard - Sales Recognition

12 Months Ended

Dec. 31, 2018

Accounting Changes And Error Corrections [Abstract]

New Accounting Standard - Sales Recognition

(2) New Accounting Standard – Sales Recognition

We adopted ASU No. 2014-09, “Revenue from Contracts with Customers,” which created FASB Topic 606 (“Topic 606”) with a date of initial application of January 1, 2018.  Topic 606 also includes Subtopic 340-40, “Other Assets and Deferred Costs – Contracts with Customers,” which requires the deferral of incremental costs of obtaining a contract with a customer.  As a result, we changed our accounting policy for sales recognition and incremental costs of obtaining a contract with a customer as detailed below.

We applied Topic 606 using the modified retrospective transition method.  In adopting the new standard, the net cumulative effect from prior periods of applying the guidance in Topic 606 was recognized as a cumulative effect adjustment to the opening balance of retained earnings in our consolidated balance sheet as of January 1, 2018.  Additionally, we have elected the option to only account for contracts that remained open as of the January 1, 2018 transition date in accordance with Topic 606.  Revenue recognition for contracts for which substantially all of the revenue was recognized in accordance with the revenue guidance in effect before January 1, 2018 has not been changed.  The comparative information as of December 31, 2017 and for the years ended December 31, 2017 and 2016 have not been adjusted and continue to be reported under the previously applicable accounting standards.  The details of the significant changes and quantitative impact of the changes are set forth below.

• For sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we changed our accounting to record both the software license and the accompanying software maintenance on a net basis, as the agent in the arrangement, given the predominant nature of the goods and services provided to the customer.  Under previous guidance, we bifurcated the sale of the software license from the sale of the maintenance contract, recorded the sale of the software product on a gross sales recognition basis and recorded the sale of the software maintenance on a net sales recognition basis.  This change has no effect on reported gross profit dollars associated with these transactions.

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

• The accounting for renewals of certain software term/usage licenses changed to delay or accelerate revenue recognition to the renewal period.  Under previous guidance, we recognized revenue as the renewal order was completed.

• The accounting for certain contracts with our clients that include payment terms that exceed one year changed such that we recognize revenue at the point in time when control of the product is transferred to the client or over the period of time that the service is provided to the client.  To the extent that a significant financing component exists in these arrangements, we will record interest income associated with the financing component of the arrangement over the payment terms of the arrangement.  Under previous guidance, we deferred revenue recognition under these contracts until payments became due as a result of the extended payment terms.

• The timing of revenue recognition for certain services contracts also changed to align with an appropriate input or output method.  For example, the timing of revenue recognition for certain services contracts with stated milestone terms changed to an earlier point in time when control transfers to the customer.  Under previous guidance, we recognized revenue based on the milestones stated in the contract with our customer.

• The accounting for recording sales returns allowance changed from being recorded against accounts receivable to being recorded as a refund liability.  As a result, in our consolidated balance sheets, we reclassified our sales returns allowance balance from accounts receivable, net to accrued expenses and other current liabilities.  Under previous guidance, we recorded the sales returns allowance in accounts receivable, net and not as a separately stated liability.  

• The accounting for sales commissions on contracts with performance periods that exceed one year changed such that we record such sales commissions as an asset and amortize them to expense over the related contract performance period.  Under previous guidance, sales commissions were expensed in the period the transaction was generated.

The total cumulative effect adjustment from prior periods that we recognized in our consolidated balance sheet as of January 1, 2018 as an adjustment to retained earnings was $7,176,000.

The following tables summarize the effects of adopting Topic 606 on the Company’s consolidated financial statements as of December 31, 2018 (in thousands, except for per share data):

BALANCE SHEET AT DECEMBER 31, 2018

							Pre-Topic 606
	As Reported			Adjustments			Adoption
Cash and cash equivalents	$	142,655		$	—		$	142,655
Accounts receivable, net		1,931,736			(145,184	)		1,786,552
Inventories		148,503			—			148,503
Inventories not available for sale		—			118,936			118,936
Other current assets		115,683			39,684			155,367
Total current assets		2,338,577			13,436			2,352,013
Property and equipment, net		72,954			—			72,954
Goodwill		166,841			—			166,841
Intangible assets, net		112,179			—			112,179
Deferred income taxes		7,967			—			7,967
Other assets		77,429			(13,762	)		63,667
	$	2,775,947		$	(326	)	$	2,775,621
Accounts payable – trade	$	978,104		$	(84,504	)	$	893,600
Accounts payable – inventory financing facility		304,130			—			304,130
Accrued expenses and other current liabilities		190,733			(16,557	)		174,176
Current portion of long-term debt		1,395			—			1,395
Deferred revenue		62,300			121,526			183,826
Total current liabilities		1,536,662			20,465			1,557,127
Long-term debt		195,525			—			195,525
Deferred income taxes		683			—			683
Other liabilities		56,088			(11,443	)		44,645
		1,788,958			9,022			1,797,980
Stockholders’ equity:
Preferred stock		—			—			—
Common stock		355			—			355
Additional paid-in capital		323,622			—			323,622
Retained earnings		704,665			(9,311	)		695,354
Accumulated other comprehensive loss – foreign    currency translation adjustments		(41,653	)		(37	)		(41,690	)
Total stockholders’ equity		986,989			(9,348	)		977,641
	$	2,775,947		$	(326	)	$	2,775,621

STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2018

						Pre-Topic 606
	As Reported		Adjustments			Adoption
Net sales:
Products	$	6,249,938	$	49,497		$	6,299,435
Services		830,198		(11,675	)		818,523
Total net sales		7,080,136		37,822			7,117,958
Costs of goods sold:
Products		5,711,400		39,616			5,751,016
Services		375,018		479			375,497
Total costs of goods sold		6,086,418		40,095			6,126,513
Gross profit		993,718		(2,273	)		991,445
Operating expenses:
Selling and administrative expenses		756,529		373			756,902
Severance and restructuring expenses		3,424		—			3,424
Acquisition-related expenses		282		—			282
Earnings from operations		233,483		(2,646	)		230,837
Non-operating expense, net		21,581		8			21,589
Earnings before income taxes		211,902		(2,654	)		209,248
Income tax expense		48,225		(519	)		47,706
Net earnings	$	163,677	$	(2,135	)	$	161,542
Net earnings per share:
Basic	$	4.60	$	(0.06	)	$	4.54
Diluted	$	4.55	$	(0.06	)	$	4.49
Shares used in per share calculations:
Basic		35,586		—			35,586
Diluted		36,009		—			36,009

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2018

The adoption of Topic 606 had no effect on net cash provided by operating activities, net cash used in investing activities or net cash used in financing activities for the year ended December 31, 2018.  The adjustment to net earnings noted above in reconciling our reported results of operations for the year ended December 31, 2018 under Topic 606 to pre-Topic 606 adoption was fully offset by adjustments to the reported changes in asset and liability balances, resulting in no effect on operating cash flows.

Disaggregation of Revenue

In the following table, revenue is disaggregated by our reportable operating segments, which are primarily defined bytheir related geographies, as well as by major product offering, by major client group and by recognition on either a gross basis as a principal in the arrangement, or on a net basis as an agent, for the year ended December 31, 2018 (in thousands):

	Year Ended December 31, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	3,610,356	$	653,499	$	29,496	$	4,293,351
Software		1,112,715		736,509		107,363		1,956,587
Services		639,910		140,233		50,055		830,198
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136
Major Client Groups
Large Enterprise / Corporate	$	3,951,900	$	1,134,696	$	49,826	$	5,136,422
Public Sector		498,873		327,818		76,567		903,258
Small and Medium-Sized Businesses		912,208		67,727		60,521		1,040,456
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	5,143,228	$	1,439,979	$	164,394	$	6,747,601
Net revenue recognition (Agent)		219,753		90,262		22,520		332,535
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136

Contract Balances

The following table provides information about receivables, contract assets and contract liabilities as of December 31, 2018 and January 1, 2018 (in thousands):

	December 31,		January 1,
	2018		2018
Current receivables, which are included in “Accounts    receivable, net”	$	1,931,736	$	1,909,074
Non-current receivables, which are included in “Other assets”		38,157		32,227
Contract assets, which are included in “Other current    assets”		892		595
Contract liabilities, which are included in “Deferred    revenue” and “Other liabilities”		82,117		86,743

Significant changes in the contract assets and the contract liabilities balances during the year ended December 31, 2018 are as follows (in thousands):

	Increase (Decrease)
	Contract			Contract
	Assets			Liabilities
Balances at January 1, 2018	$	595		$	86,743
Reclassification of the beginning contract liabilities    to revenue, as the result of performance    obligations satisfied		—			(72,779	)
Cash received in advance and not recognized as    revenue		—			68,153
Reclassification of the beginning contract assets to   receivables, as the result of rights to consideration    becoming unconditional		(595	)		—
Contract assets recognized, net of reclassification to    receivables		892			—
Balances at December 31, 2018	$	892		$	82,117

Transaction price allocated to the remaining performance obligations

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2018 that are expected to be recognized in the future (in thousands):

	Products		Services		Total
2019		13		88,998		89,011
2020		5		28,906		28,911
2021		—		11,251		11,251
2022		—		4,413		4,413
2023		—		1,841		1,841
2024 and thereafter		—		376		376
Total remaining performance obligations	$	18	$	135,785	$	135,803

Topic 606 allows for certain practical expedients which we have elected to apply.  As a result, with the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, we do not disclose information about remaining performance obligations that have original expected durations of one year or less in the table above.  Amounts not included in the table above have an average original expected duration of eight months.  Additionally, for our time and material services contracts, whereby we have the right to consideration from a client in an amount that corresponds directly with the value to the client of our performance completed to date, we recognized revenue in the amount to which we have a right to invoice as of December 31, 2018 and do not disclose information about related remaining performance obligations in the table above.  Our time and material contracts have an average expected duration of 12 months.

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, therefore we do not include performance obligations under open cancelable purchase orders, which do not qualify for revenue recognition in accordance with Topic 606 as of December 31, 2018, in the table above.

Assets recognized for costs of obtaining a contract with a customer

We believe that the only significant incremental costs incurred to obtain contracts with our clients within the scope of Topic 606 are sales commissions.  The majority of our contracts are completed within a one-year performance period, and for contracts with a specified term of one year or less, we have exercised a practical expedient, which allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.  Under Topic 606, we record sales commissions on contracts with performance periods that exceed one year as an asset and amortize the asset to expense over the related contract performance period.  As of December 31, 2018, the related asset balance was $2,763,000, which we expect to recognize as expense over the next 36 months.  Under previous accounting standards, we recognized sales commissions as earned and recorded such amounts within selling and administrative expenses in our statements of operations.

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Property and Equipment

12 Months Ended

Dec. 31, 2018

Property Plant And Equipment [Abstract]

Property and Equipment

(3) Property and Equipment

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

	December 31,
	2018			2017
Software	$	170,327		$	171,701
Buildings		64,263			65,468
Equipment		100,421			103,542
Furniture and fixtures		38,200			38,459
Leasehold improvements		26,319			25,981
Land		5,124			5,179
		404,654			410,330
Accumulated depreciation and amortization		(331,700	)		(335,078	)
Property and equipment, net	$	72,954		$	75,252

We periodically assess whether any indicators of impairment existed related to our property and equipment.  We incurred non-cash charges of $393,000 and $418,000 during 2018 and 2017, 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 $21,721,000, $25,787,000 and $27,493,000 in 2018, 2017 and 2016, respectively.  Interest charges capitalized in connection with internal-use software development projects in 2018, 2017 and 2016 were immaterial.  

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Goodwill

12 Months Ended

Dec. 31, 2018

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill

(4) Goodwill

The changes in the carrying amount of goodwill for the year ended December 31, 2018 are as follows (in thousands):

	North America			EMEA			APAC			Consolidated
Goodwill	$	379,110		$	151,439		$	20,930		$	551,479
Accumulated impairment losses	$	(323,422	)	$	(151,439	)	$	(13,973	)	$	(488,834	)
Goodwill acquired during 2017		64,140			4,041			605			68,786
Balance at December 31, 2017		119,828			4,041			7,562			131,431
Goodwill acquired during 2018		36,440			(108	)		—			36,332
Foreign currency translation adjustment		—			(184	)		(738	)		(922	)
Balance at December 31, 2018	$	156,268		$	3,749		$	6,824		$	166,841

On August 1, 2018, we acquired Cardinal, which has been integrated into our North America business. Under the acquisition 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 $36,440,000 was recorded as goodwill in the North America reporting unit (see Note 20).  The primary driver for this acquisition was to strengthen our services capabilities and bring value to our clients within our digital innovation services solution offering.

On September 26, 2017, we acquired Caase.com, which has been integrated into our EMEA business.  Under the acquisition 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 20).  The primary driver for this acquisition was to strengthen our ability to deliver cloud and data center solutions to our clients in the Netherlands, with a view to expand into the wider European region in the near future.  The change in goodwill in our EMEA operating segment as of December 31, 2018 compared to the balance as of December 31, 2017 resulted from a final balancing adjustment during the year and foreign currency translation adjustments associated with the goodwill balance.

On January 6, 2017, we acquired Datalink, which has been integrated into our North America business.  Under the acquisition 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 20).  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 acquisition 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 20).  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 digital innovation solutions to our clients in the Asia-Pacific region.  The change in goodwill as of December 31, 2017 compared to the balance as of December 31, 2016 resulted from a final working capital adjustment and foreign currency translation adjustments associated with the goodwill balance.  

During 2018, 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 2018.  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, 2018

Goodwill And Intangible Assets Disclosure [Abstract]

Intangible Assets

(5) Intangible Assets

Intangible assets consist of the following (in thousands):

	December 31,
	2018			2017
Customer relationships	$	159,566		$	133,660
Other		5,555			4,475
		165,121			138,135
Accumulated amortization		(52,942	)		(37,357	)
Intangible assets, net	$	112,179		$	100,778

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.

During 2018, 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 2018, 2017 and 2016 was $15,737,000, $16,812,000 and $10,637,000, respectively.  

Future amortization expense for the remaining unamortized balance as of December 31, 2018 is estimated as follows (in thousands):

Years Ending December 31,	Amortization Expense
2019	$	14,602
2020		14,590
2021		14,429
2022		14,256
2023		13,831
Thereafter		40,471
Total amortization expense	$	112,179

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Accounts Payable - Inventory Financing Facility

12 Months Ended

Dec. 31, 2018

Payables And Accruals [Abstract]

Accounts Payable - Inventory Financing Facility

(6) 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.    

Our inventory financing facility was amended on March 23, 2018 to increase the aggregate availability for vendor purchases under the facility from $325,000,000 to $400,000,000, of which $304,130,000 was outstanding at December 31, 2018.  In conjunction with the increase, we no longer have the option to request additional increases in the aggregate amount available under the inventory financing facility without amending the facility.  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); however, 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 $10,593,000, $6,736,000 and $3,385,000 was recorded in 2018, 2017 and 2016, 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, 2018

Debt Disclosure [Abstract]

Debt, Capital Lease and Other Financing Obligations

(7) Debt, Capital Lease and Other Financing Obligations

Debt

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

	December 31,
	2018			2017
Senior revolving credit facility	$	—		$	117,500
Term Loan A (less unamortized debt issuance costs of $873 in    2017)		—			165,377
Accounts receivable securitization financing facility		194,000			25,000
Capital leases and other financing obligations		2,920			5,291
Total		196,920			313,168
Less: current portion of long-term debt		(1,395	)		(16,592	)
Long-term debt	$	195,525		$	296,576

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, in connection with the acquisition of Datalink, we amended our revolving facility to expand the facility by $175,000,000 in the form of an incremental Term Loan A (“TLA”).  On December 7, 2018, we paid off the remaining balance of the TLA.  The revolving facility is 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, 2018 was 3.66% per annum for the revolving facility.  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 2018, 2017 and 2016, due to availability under our accounts receivable securitization financing facility (“ABS facility”), weighted average borrowings under our revolving facility were $16,684,000, $63,604,000 and $35,811,000, respectively.  Interest expense associated with the revolving facility and TLA was $8,198,000, $8,491,000 and $2,191,000 in 2018, 2017 and 2016, respectively, including the commitment fee and amortization of deferred financing fees.  As of December 31, 2018, $350,000,000 was available under our revolving facility.  See discussion of the maximum leverage ratio under “Debt Covenants” below.  The revolving facility matures on June 23, 2021.

Our ABS facility was amended on June 27, 2018 to, among other things, renew the borrowing program for a three-year term expiring June 23, 2021.  The ABS facility has a maximum aggregate borrowing availability of $250,000,000.  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, 2018 and 2017, the SPE owned $1,101,597,000 and $1,141,520,000, 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, 2018, qualified receivables were sufficient to permit access to the full $250,000,000 facility amount, of which $194,000,000 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, 2018 was 3.46% 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, 2018, 2017 and 2016, 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 3.6%, 2.4% and 1.9%,  respectively.  Weighted average borrowings under our ABS facility in 2018, 2017 and 2016 were $98,663,000, $153,759,000 and $145,376,000, respectively.

Debt Covenants

Our revolving facility 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 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 is currently 3.25 times our trailing twelve-month adjusted earnings.  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, 2018, our aggregate debt balance that could have been outstanding under our revolving facility and our ABS facility was the full amount of the maximum borrowing capacity of $600,000,000, of which$194,000,000 was outstanding under our ABS facility at December 31, 2018.      

Capital Lease and Other Financing Obligations

In 2016 and 2017, we entered into capital leases with 36 to 40 month terms for certain IT equipment.  In October 2018, these capital leases were modified and the lease terms were extended to between 30 and 33 month terms.  The original capital leases and subsequent modifications were non-cash transactions and, accordingly, $977,000 has been excluded from our consolidated statements of cash flows for the years ended December 31, 2018 and 2017.  

Future minimum payments under the capitalized leases consist of the following as of December 31, 2018 (in thousands):

Years Ending December 31,
2019	$	1,488
2020		1,151
2021		432
Total minimum lease payments		3,071
Less amount representing interest		(151	)
Present value of minimum lease payments	$	2,920

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.  As of December 31, 2018 there were no amounts outstanding related to these financing obligations.  As of December 31, 2017, $2,489,000 was outstanding related to these financing obligations.  

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, 2018 and 2017.

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Operating Leases

12 Months Ended

Dec. 31, 2018

Leases [Abstract]

Operating Leases

(8) 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 $20,114,000, $19,126,000 and $14,444,000 in 2018, 2017 and 2016, 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, 2018 are as follows (in thousands):

Years Ending December 31,
2019	$	21,499
2020		15,580
2021		12,121
2022		9,150
2023		6,296
Thereafter		7,238
Total minimum lease payments	$	71,884

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

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Severance and Restructuring Activities

12 Months Ended

Dec. 31, 2018

Restructuring And Related Activities [Abstract]

Severance and Restructuring Activities

(9) Severance and Restructuring Activities

During 2018, 2017 and 2016, 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 2018 and 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, 2018 related to these resource actions, and the outstanding obligations as of December 31, 2018 (in thousands):

	North America			EMEA			APAC			Consolidated
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
Severance costs, net of adjustments		1,617			1,677			130			3,424
Cash payments		(2,003	)		(3,386	)		(145	)		(5,534	)
Foreign currency translation adjustments		(41	)		(37	)		—			(78	)
Balances at December 31, 2018	$	1,204		$	1,248		$	—		$	2,452

Immaterial adjustments were recorded as a reduction to severance and restructuring expense in each of 2018, 2017 and 2016, due to changes in estimates.

The remaining outstanding obligations as of December 31, 2018 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

Dec. 31, 2018

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

(10) 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,
	2018		2017		2016
North America	$	11,697	$	9,697	$	8,096
EMEA		3,170		2,737		2,530
APAC		488		392		432
Total Consolidated	$	15,355	$	12,826	$	11,058

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, 2018, of the 7,250,000shares of common stock reserved and available for grant under the Plan, 2,791,688shares 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, 2018, total compensation cost related to nonvested RSUs not yet recognized is $21,104,000, which is expected to be recognized over the next 1.31 years on a weighted-average basis.

The following table summarizes our RSU activity during 2018:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at the beginning of year		892,113		$	32.86
Granted		557,823		$	36.79
Vested, including shares withheld to cover taxes		(383,672	)	$	29.80	$	14,302,223	(a)
Forfeited		(45,334	)	$	34.10
Nonvested at the end of year		1,020,930		$	36.10	$	41,602,898	(b)

^(f) 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 2017 and 2016 was $20,284,762 and $9,235,102, respectively.

^(g) 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 $40.75as of December 31, 2018, 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, 2018, 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 2018, 2017 and 2016 of 88,638, 122,255 and 84,953, respectively, were based on the value of the RSUs on their vesting dates as determined by our closing stock price on such dates.  For 2018, 2017 and 2016, total payments for our teammates’ tax obligations to the taxing authorities were $3,230,000, $5,318,000 and $2,219,000, 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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Income Taxes

12 Months Ended

Dec. 31, 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):

	Years Ended December 31,
	2018			2017			2016
Earnings before income taxes:
United States	$	145,907		$	119,330		$	99,095
Foreign		65,995			39,768			40,363
	$	211,902		$	159,098		$	139,458
Income tax expense:
Current:
U.S. Federal	$	18,334		$	31,067		$	27,947
U.S. State and local		3,218			3,636			2,200
Foreign		17,547			14,573			14,104
		39,099			49,276			44,251
Deferred:
U.S. Federal		8,123			20,327			10,395
U.S. State and local		1,142			(427	)		1,088
Foreign		(139	)		(761	)		(966	)
		9,126			19,139			10,517
	$	48,225		$	68,415		$	54,768

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):

	2018					2017					2016
Statutory federal income tax rate	$	44,499		21.0	%	$	55,684		35.0	%	$	48,810		35.0	%
State income tax expense, net of    federal income tax benefit		6,767		3.2			2,808		1.8			3,368		2.4
Audits and adjustments, net		2,659		1.3			(313	)	(0.2	)		(1,039	)	(0.7	)
Change in valuation allowances		60		—			2,472		1.5			3,742		2.7
Foreign income taxed at different rates		2,639		1.2			(6,057	)	(3.8	)		(6,611	)	(4.7	)
U.S. mandatory deemed repatriation		(1,396	)	(0.7	)		5,625		3.5			—		—
Adjustment of net deferred tax assets    for enacted U.S. federal tax reform		(4,198	)	(2.0	)		7,738		4.9			—		—
Research and development credits		(4,132	)	(1.9	)		—		—			—		—
Change in U.S. tax law applicable to    certain foreign entities		—		—			—		—			2,577		1.8
Non-deductible compensation		1,399		0.7			571		0.4			518		0.4
Other, net		(72	)	—			(113	)	(0.1	)		3,403		2.4
Effective tax rate	$	48,225		22.8	%	$	68,415		43.0	%	$	54,768		39.3	%

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 and the first nine months of 2018, we recorded provisional amounts for certain tax enactment-date effects of the new law by applying the guidance of SAB 118 because we had not yet completed our enactment-date accounting for these effects.  In 2017 and 2018, the company recorded tax expense and benefit, respectively, related to the new tax law that included remeasurement of U.S. deferred income taxes, the mandatory deemed repatriation provision and the state tax effects of these items.  The changes to 2017 provisional amounts resulted in a benefit of $5.6 million, which reduced our annual effective tax rate by 2.7% in 2018.  At December 31, 2018 the accounting for the enactment-date income tax effects for the new tax law are completed.

U.S. federal tax reform subjects a U.S. corporation to tax on its global intangible low-taxed income (GILTI). U.S. GAAP allows companies to make an accounting policy election to either (1) treat taxes due on future GILTI inclusions in U.S. taxable income as a current-period expense when incurred (“period cost method”) or (2) factor such amounts into the measurement of its deferred taxes (“deferred method”). We have elected to use the period cost method.

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,
	2018			2017
Deferred tax assets:
Net operating losses	$	23,926		$	25,418
Foreign tax credits		16,800			21,346
Accruals		4,242			5,921
Stock-based compensation		3,173			3,023
Property and equipment		2,008			1,111
Accounts receivable		1,980			2,124
Goodwill and other intangibles		1,296			4,717
Deferred revenue		1,016			600
Inventories		133			1,930
Other		2,487			335
Gross deferred tax assets		57,061			66,525
Valuation allowances		(40,630	)		(45,995	)
Total deferred tax assets		16,431			20,530
Deferred tax liabilities:
Inventories		(4,885	)		—
Accrued withholding tax		(1,303	)		(1,452	)
Goodwill and other intangibles		(1,202	)		(1,587	)
Other		(1,757	)		(1,144	)
Total deferred tax liabilities		(9,147	)		(4,183	)
Net deferred tax assets	$	7,284		$	16,347

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

	December 31,
	2018			2017
Net non-current deferred tax assets	$	7,967		$	17,064
Net non-current deferred tax liabilities		(683	)		(717	)
Net deferred tax assets	$	7,284		$	16,347

As of December 31, 2018, we have a federal net operating loss carryforward (“NOL”) of $252,000 and U.S. state NOLs of $1,403,000 that will expire between 2019 and 2037.  We also have NOLs from various non-U.S. jurisdictions of $84,266,000.  While the majority of the non-U.S. NOLs have no expiration date, $5,329,000 will expire between 2019 and 2025.  

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, 2018 and 2017, our valuation allowances totaled $40,630,000 and $45,995,000, 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,
	2018			2017
Valuation allowances at beginning of year	$	45,995		$	30,972
Increase in income tax expense		60			2,472
U.S. federal tax reform		(1,589	)		11,623
Foreign currency translation adjustments		(1,180	)		2,865
Other		(2,656	)		(1,937	)
Valuation allowances at end of year	$	40,630		$	45,995

The change 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, 2018 and 2017, we had approximately $6,849,000 and $4,273,000, respectively, of unrecognized tax benefits.  Of these amounts, approximately $313,000 and $287,000, 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, 2017	$	3,986
Additions for tax positions in prior periods		1,613
Additions for tax positions in current period		2,014
Subtractions due to foreign currency translation		(8	)
Subtractions due to audit settlements and statute expirations		(1,069	)
Balance at December 31, 2018	$	6,536

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 2017.  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, 2017 and 2018 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, 2018

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 no amounts outstanding under our revolving facility and TLA and $194,000,000 outstanding under our ABS facility at December 31, 2018.  The interest rate attributable to the borrowings under our revolving facility and our ABS facility was 3.66%and 3.46%, respectively, per annum at December 31, 2018.  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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Fair Value Measurements

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

(13) 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, 2018, 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, 2018

Compensation And Retirement Disclosure [Abstract]

Benefit Plans

(14) 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 $15,216,000, $14,083,000 and $7,684,000 for 2018, 2017 and 2016, respectively.

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Share Repurchase Programs

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Share Repurchase Programs

(15) Share Repurchase Programs

In each of February 2018 and February 2016, our Board of Directors authorized share repurchase programs of $50,000,000.  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, 2018, 2017 and 2016, respectively, in thousands, except per share amounts:

Year	Total Number of Shares Purchased		Average Price Paid per Share		Approximate Dollar Value of Shares Purchased
2018		641	$	34.42	$	22,069
2017		—		—		—
2016		1,891		26.43		50,000
Total		2,532			$	72,069

All shares repurchased were retired.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2018

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

(16) 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, 2018, we had approximately $3,725,000 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, 2018.  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, 2018.  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

Dec. 31, 2018

Receivables [Abstract]

Supplemental Financial Information

(17) Supplemental Financial Information

Additions and deductions related to the allowance for doubtful accounts receivable for 2018, 2017 and 2016 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, 2018	$	10,158	$	4,776	$	(4,472	)	$	10,462
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

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Cash Flows

12 Months Ended

Dec. 31, 2018

Supplemental Cash Flow Elements [Abstract]

Cash Flows

(18) Cash Flows

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

	Years Ended December 31,
	2018		2017		2016
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$	10,155	$	10,976	$	3,782
Cash paid during the year for income taxes, net of    refunds	$	31,218	$	55,470	$	39,051

Non-cash investing activities for 2018, 2017 and 2016 included $1,170,000, $159,000 and $791,000, 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

Dec. 31, 2018

Segment Reporting [Abstract]

Segment and Geographic Information

(19) 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.  

The following tables summarize net sales by offering for North America, EMEA and APAC by sales mix amounts (in thousands):

	North America
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	3,610,356	$	3,352,355	$	2,454,889
Software		1,112,715		1,310,118		1,146,808
Services		639,910		519,261		370,131
	$	5,362,981	$	5,181,734	$	3,971,828

	EMEA
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	653,499	$	536,500	$	481,505
Software		736,509		710,452		762,427
Services		140,233		108,464		94,628
	$	1,530,241	$	1,355,416	$	1,338,560

	APAC
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	29,496	$	27,907	$	18,916
Software		107,363		101,412		132,718
Services		50,055		37,154		23,493
	$	186,914	$	166,473	$	175,127

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 2018, 2017 or 2016.

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, 2018
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	4,723,071	$	1,390,008	$	136,859	$	6,249,938
Services		639,910		140,233		50,055		830,198
Total net sales		5,362,981		1,530,241		186,914		7,080,136
Costs of goods sold:
Products		4,313,070		1,273,422		124,908		5,711,400
Services		317,216		35,352		22,450		375,018
Total costs of goods sold		4,630,286		1,308,774		147,358		6,086,418
Gross profit		732,695		221,467		39,556		993,718
Operating expenses:
Selling and administrative expenses		545,091		182,470		28,968		756,529
Severance and restructuring expenses		1,617		1,677		130		3,424
Acquisition-related expenses		282		—		—		282
Earnings from operations	$	185,705	$	37,320	$	10,458	$	233,483

	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

	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

The following table is a summary of our total assets by reportable operating segment (in thousands):

	December 31, 2018			December 31, 2017
North America	$	2,660,886		$	2,337,573
EMEA		611,338			530,242
APAC		98,959			101,169
Corporate assets and intercompany eliminations, net		(595,236	)		(283,333	)
Total assets	$	2,775,947		$	2,685,651

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
2018
Net sales	$	5,100,456	$	843,145	$	1,136,535	$	7,080,136
Total long-lived assets	$	52,346	$	12,434	$	8,174	$	72,954
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

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,
	2018		2017		2016
Depreciation and amortization of property and    equipment:
North America	$	17,164	$	20,241	$	21,952
EMEA		4,058		5,025		4,908
APAC		499		521		633
		21,721		25,787		27,493
Amortization of intangible assets:
North America		14,791		15,971		8,139
EMEA		285		73		1,951
APAC		661		768		547
		15,737		16,812		10,637
Total	$	37,458	$	42,599	$	38,130

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Acquisitions

12 Months Ended

Dec. 31, 2018

Business Combinations [Abstract]

Acquisitions

(20) Acquisitions

Cardinal

Effective August 1, 2018, we acquired 100 percent of the issued and outstanding shares of Cardinal, a digital solutions provider based in Cincinnati, Ohio, with offices across the Midwest and Southeast United States, for a cash purchase price, net of cash acquired, of approximately $78,800,000, including working capital and estimated tax adjustments of $3,800,000.  Cardinal provides technology solutions to digitally transform organizations through their expertise in mobile applications development, Internet of Things and cloud enabled business intelligence.  We believe that this acquisition strengthens our services capabilities and will bring value to our clients within our digital innovation services solution offering.

The fair value of net assets acquired was approximately $42,360,000, including $27,540,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight line method over the estimated economic life of ten years.  The fair value of the customer relationships was determined using the multiple-period excess earnings method. The preliminary purchase price was allocated using the acquisition method of accounting using the information available at the time.  During the fourth quarter of 2018 we finalized the fair value assumptions for identifiable intangible assets with no changes being made to amounts previously recorded.  Goodwill acquired approximated $36,440,000 which was recorded in our North America operating segment.  The goodwill is tax deductible.  The working capital adjustment was finalized in the fourth quarter of 2018.  We will finalize the purchase price allocation in 2019 when the final tax adjustment is completed and agreed upon.

We consolidated the results of operations for Cardinal within our North America operating segment beginning on August 1, 2018, the effective date of the acquisition.  Our historical results would not have been materially affected by the acquisition of Cardinal 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 statement of operations.  

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 cloud and data center 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 finalized the purchase price allocation in the third quarter of 2018 when the final working capital adjustment was agreed upon and paid and the evaluation of uncertain tax positions was 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 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
Net sales	As reported	$	6,703,623	$	5,485,515
	Proforma	$	6,707,533	$	6,084,484
Net earnings	As reported	$	90,683	$	84,690
	Proforma	$	92,276	$	85,823
Diluted earnings per share	As reported	$	2.50	$	2.32
	Proforma	$	2.55	$	2.36

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 digital innovation solutions 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 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.

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Assets Held for Sale

12 Months Ended

Dec. 31, 2018

Discontinued Operations, Disposed of by Sale [Member] | Russia [Member]

Assets Held for Sale

(21) 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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Selected Quarterly Financial Information

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Information

(22) Selected Quarterly Financial Information (unaudited)

The following tables set forth selected unaudited consolidated quarterly financial information for 2018 and 2017 (in thousands, except per share data):

	Quarters Ended
	December 31, 2018			September 30, 2018			June 30, 2018 (1)			March 31, 2018 (1)
Net sales	$	1,749,046		$	1,747,726		$	1,840,870		$	1,742,494
Costs of goods sold		1,494,882			1,512,812			1,576,493			1,502,231
Gross profit		254,164			234,914			264,377			240,263
Operating expenses:
Selling and administrative expenses		194,790			184,095			189,464			188,180
Severance and restructuring expenses		715			683			382			1,644
Acquisition-related expenses		—			188			94			—
Earnings from operations		58,659			49,948			74,437			50,439
Non-operating (income) expense:
Interest income		(422	)		(330	)		(170	)		(153	)
Interest expense		5,563			6,132			5,102			6,015
Net foreign currency exchange (gain) loss		(1,517	)		539			(275	)		(245	)
Other expense, net		323			393			324			302
Earnings before income taxes		54,712			43,214			69,456			44,520
Income tax expense		7,671			11,060			17,977			11,517
Net earnings	$	47,041		$	32,154		$	51,479		$	33,003
Net earnings per share:
Basic	$	1.33		$	0.91		$	1.45		$	0.92
Diluted	$	1.31		$	0.89		$	1.44		$	0.91
Shares used in per share calculations:
Basic		35,480			35,468			35,483			35,913
Diluted		35,999			35,957			35,815			36,263

	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

(1) During the quarter ended September 30, 2018, we revised our previously issued March 31, 2018 and June 30, 2018 consolidated financial statements for immaterial errors identified.  The errors primarily relate to incorrect presentation of certain software revenue transactions.  The effect of the revision on our consolidated statements of operations for the three months ended March 31, 2018 was to reduce product net sales by $24,364,000, increase services net sales by $3,953,000, reduce product cost of goods sold by $23,749,000 and increase services cost of goods sold by $3,080,000.  For the three months ended March 31, 2018, gross profit, earnings from operations and net earnings increased by $258,000.  Diluted earnings per share for the three months ended March 31, 2018 increased $0.01.

The effect of the revision on our consolidated statement of operations for the three months ended June 30, 2018 was to reduce product net sales by $949,000, increase services net sales by $4,900,000, reduce product cost of goods sold by $532,000 and increase services cost of goods sold by $4,483,000.  The effect of the revision on our consolidated statement of operations for the six months ended June 30, 2018 was to reduce product net sales by $25,313,000, increase services net sales by $8,853,000, reduce product cost of goods sold by $24,281,000 and increase services cost of goods sold by $7,563,000.  For the three months ended June 30, 2018, there was no impact to gross profit, earnings from operations or net earnings resulting from the revision.  For the six months ended June 30, 2018, gross profit, earnings from operations and net earnings increased by $258,000.  There was no impact to diluted earnings per share in either the three or six months ended June 30, 2018.

These revisions are appropriately reflected in the consolidated statement of operations for the year ended December 31, 2018.  There is no impact to the audited consolidated financial statements for 2017, 2016 or any other prior period.

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Operations and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2018

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Description of Business

Description of Business

We empower organizations of all sizes with Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter. 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.  

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.

Business Combinations

Business Combinations

The Company accounts for all business combinations using the acquisition method of accounting, which allocates the fair value of the purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values.  The excess of the purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill.  When determining the fair values of assets acquired and liabilities assumed, management makes estimates and assumptions.  Initial purchase price allocations are subject to revision within the measurement period, not to exceed one year from the date of acquisition.  Acquisition-related expenses and transaction costs associated with business combinations are expensed as incurred.

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, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents and Restricted Cash

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.

Restricted cash generally includes any cash that is restricted as to withdrawal or usage.  These amounts are included with cash and cash equivalents on the consolidated statement of cash flows.  All cash receipts/payments with third parties directly to/from restricted cash accounts are reported as an operating, investing or financing cash flow, based on the nature of the transaction.

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 under previous accounting guidance, prior to Topic 606, these transactions did not meet the sales recognition criteria under GAAP.  Therefore, we did not record sales and the inventories were classified as inventories not available for sale on our consolidated balance sheet until the product was delivered.  If clients remitted payment before we delivered the product to them, then we recorded the payments received as deferred revenue on our consolidated balance sheet until such time as the product was delivered.  For additional information about our accounting policy related to these transactions after adopting Topic 606, see the Bill and Hold Transactions section of our Sales Recognition policy, below.

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 economic 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 would likely be used to assess the fair value of the reporting unit.  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 finite lived intangible assets acquired in business combinations using the straight-line method over the estimated economic lives of the intangible assets from the date of acquisition.

We regularly perform reviews to determine if facts and circumstances exist which indicate that the economic 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.

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

We adopted ASU No. 2014-09, “Revenue from Contracts with Customers,” which created FASB Topic 606 (“Topic 606”) with a date of initial application of January 1, 2018.  As a result, we changed our accounting policy for sales recognition as detailed below.  Revenue is measured based on the consideration specified in a contract with a client, and excludes any sales incentives and amounts collected on behalf of third parties.  The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product or service to a client.

Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a client, are excluded from revenue.  This is consistent with our accounting treatment prior to the adoption of Topic 606, whereby we reported sales net of any sales-based taxes assessed by governmental authorities that are imposed on and concurrent with sales transactions.

We record the freight we bill to our clients as product net sales and the related freight costs we pay as product costs of goods sold.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Nature of Goods and Services

We sell hardware and software products on both a stand-alone basis without any services and as solutions bundled with services.

When we provide a combination of hardware and software products with the provision of services, we separately identify our performance obligations under our contract with the client as the distinct goods (hardware and/or software products) or services that will be provided.  The total transaction price for an arrangement with multiple performance obligations is allocated at contract inception to each distinct performance obligation in proportion to its stand-alone selling price.  The stand-alone selling price is the price at which we would sell a promised good or service separately to a client.  We estimate the price based on observable inputs, including direct labor hours and allocable costs, or use observable stand-alone prices when they are available.  

Product Offerings

Hardware

We recognize hardware product revenue at the point in time when a client takes control of the hardware, which typically occurs when title and risk of loss have passed to the client at its destination.  Our selling terms and conditions were modified during the fourth quarter of 2017 to specify F.O.B. destination contractual terms such that control is transferred from the Company at the point in time when the product is received by the client.  Prior to the adoption of Topic 606, because we either (i) had a general practice of covering client losses while products were in transit despite title and risk of loss contractually transferring at the point of shipment or (ii) had specifically stated F.O.B. destination contractual terms with the client, delivery was not deemed to have occurred until the point in time when the product was received by the client.  The transaction price for hardware sales is adjusted 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 as the principal in the transaction when the product is received by the client because we control the product prior to transfer to the client.  We also assume primary responsibility for 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 and we work closely with our clients to determine their hardware specifications.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Bill and Hold Transactions

We offer a service to our customers whereby clients may purchase product that we procure on their behalf and, at our clients’ direction, store the product in our warehouse for a designated period of time, with the intention of deploying the product to the clients’ designated locations at a later date.  These warehousing services are designed to help our clients with inventory management challenges associated with technology roll-outs, product that is moving to end of life, and/or clients needing integrated stock available for immediate deployment.  In some circumstances, we may also perform lab integration services on a portion of the product prior to shipment to our clients for a separate fee.  The client is invoiced and title transfers to the client upon receipt of the product at our warehouse.  These product contracts are non-cancelable with customary credit terms beginning the date the product is received in our warehouse and the warranty periods begin on the date of invoice.  Revenue is recognized for the sale of the product to the client upon receipt of the product at our warehouse.  

The warehousing services and lab integration fees are considered separate performance obligations.  Under previous accounting guidance, prior to the adoption of Topic 606, it was determined that these product sales transactions did not meet the revenue recognition criteria under GAAP.  Therefore, we did not record product net sales, and the inventories were classified as inventories not available for sale on our consolidated balance sheets, until the product was delivered to the clients’ designated location.  If clients remitted payment before we delivered the product to them, we recorded the payments received as deferred revenue on our consolidated balance sheets until such time as the product was delivered.

Software

We recognize revenue from software sales at the point in time when the client acquires the right to use or copy software under license and control transfers to the client.  For renewals, revenue is recognized upon the commencement of the term of the software license agreement or when the renewal term begins, as applicable.  This is a change from our accounting treatment prior to the adoption of Topic 606, whereby revenue from renewals of software licenses was recognized when the parties agreed to the renewal or extension, provided that all other revenue recognition criteria had been met.  

Although the revenue recognition treatment for term software license renewals has changed as described above, a substantial portion of the software licenses we sell are perpetual software licenses and do not require renewal or extension after their initial purchase by the client.  Such perpetual licenses are periodically subject to true-up, whereby additional perpetual licenses are sold under the client’s pre-existing master agreement.  Such true-ups are generally sold in arrears, and clients are invoiced for the additional licenses they had already been utilizing.  Since the client controlled these additional perpetual licenses prior to the true-up, software revenue related to the underlying additional licenses is recognized when we agree to the true-up with our client and the partner.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

For sales transactions for certain security software products that are sold with integral third-party delivered software maintenance, we changed our accounting to record the software license on a net basis, as the agent in the arrangement, given the predominant nature of the goods and services provided to the customer.  This is a change from our accounting treatment prior to the adoption of Topic 606, whereby we recorded the sale of these software products on a gross sales recognition basis.

Services Offerings

Software Maintenance

Software maintenance agreements provide our clients with the right to obtain any software upgrades, bug fixes and help desk and other support services directly from the software publisher at no additional charge during the term of the software maintenance agreements.  We act as the software publisher’s agent in selling these software maintenance agreements and do not assume any performance obligation to the client under the agreements.  As a result, we are the agent in these transactions and these sales are recorded on a net sales recognition basis.  Under net sales recognition, the cost of the software maintenance agreement 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.  Because we are acting as the software publisher’s agent, revenue is recognized when the parties agree to the initial purchase, renewal or extension as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.  

Cloud / Software-as-a-Service Offerings

Cloud or software-as-a-service subscription products provide our clients with access to software products hosted in the public cloud without the client taking possession of the software.  We act as the software publisher’s agent in selling these software-as-a service subscription products and do not host the software products on our servers.  We do not take control of the software products or assume any performance obligations to the clients related to the provisioning of the offerings in the cloud.  As a result, these sales are recorded on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.    

Insight Delivered Services

We design, procure, deploy, implement and manage solutions that combine hardware, software and services to help businesses run smarter.  Such services are provided by us or third-party sub-contract vendors as part of bundled arrangements, or are provided separately on a stand-alone basis as technical, consulting or managed services engagements.  If the services are provided as part of a bundled arrangement with hardware and software, the hardware, software and services are generally distinct performance obligations.  In general, we recognize revenue from services engagements as we perform the underlying services and satisfy our performance obligations.

We recognize revenue from sales of services by measuring progress toward complete satisfaction of the related service performance obligation.  Billings for such services that are made in advance of the related revenue recognized are recorded as a contract liability.  

Specific revenue recognition practices for certain of our services offerings are described in further detail below.

Time and Materials Services Contracts  

We recognize revenue for professional services engagements that are on a time and materials basis based upon hours incurred for the performance completed to date for which we have the right to consideration, even if such amounts have not yet been invoiced as of period end.  This is consistent with our accounting treatment prior to the adoption of Topic 606.  

Fixed Fee Services Contracts  

We recognize revenue on fixed fee professional services contracts using a proportional performance method of revenue recognition based on the ratio of direct labor and other allocated costs incurred to total estimated direct labor and other allocated costs.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

OneCall Support Services Contracts  

When we sell certain hardware and/or software products to our clients, we also enter into service contracts with them.  These contracts are support service agreements for the hardware and/or software products that were purchased from us.  Under certain support services contracts, although we purchase third-party support contracts for maintenance on the specific hardware or software products we have sold, our internal support desk assists the client first by performing an initial technical triage to determine the source of the problem and whether we can direct the client on how to fix the problem.  We refer to these services as “OneCall.”  We act as the principal in the transaction because we perform the OneCall services over the term of the support service contract and we set the price of the service charged to the client.  As a result, we recognize revenue from OneCall extended service contracts on a gross sales recognition basis ratably over the contract term of the stand ready obligation, generally one to three years.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

On our consolidated balance sheet, a significant portion of our contract liabilities balance relates to OneCall support services agreements for which clients have paid or have been invoiced but for which we have not yet recognized the applicable services revenue.  We also defer incremental direct costs to fulfill our service contracts that we prepay to third parties for direct support of our fulfillment of the service contract to our clients under our contract terms and amortize them into operations over the term of the contracts.  

Vendor Direct Support Services Contracts

When we do not provide OneCall services to the client on hardware and/or software products that were purchased, the client may purchase a vendor direct support services contract through us.  Under these contracts, our clients call the manufacturer/publisher or its designated service organization directly for both the initial technical triage and any follow-up assistance.  We act as the manufacturer/publisher’s agent in selling these support service contracts and do not assume any performance obligation to the client under the arrangements.  As a result, these sales are recorded on a net sales recognition basis similar to software maintenance agreements, as discussed above.  Because we are acting as the manufacturer/publisher’s agent, revenue is recognized when the parties agree to the purchase of the support services contract as our agency services are then complete.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

Third-party Provided Services  

A majority of our third-party sub-contractor services contracts are entered into in conjunction with other services contracts under which the services are performed by Insight teammates.  We have concluded that we control all services under the contract and can direct the third-party sub-contractor to provide the requested services.  As such, we act as the principal in the transaction and record the services under a gross sales recognition basis, with the selling price being recorded in sales and our cost to the third-party service provider being recorded in costs of goods sold.  For certain third-party service contracts in which we are not responsible for fulfillment of the services, we have concluded that we are an agent in the transaction and record revenue on a net sales recognition basis.  This is consistent with our accounting treatment prior to the adoption of Topic 606.

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 for teammates who are not directly associated with delivering services, 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 $68,571,000, $53,227,000 and $48,114,000 in 2018, 2017 and 2016, 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, 2018.  We monitor our clients’ financial condition and do not require collateral.  No single client accounted for more than 4% of our consolidated net sales in 2018.  

Supplier Risk

Purchases from Microsoft accounted for approximately 26% of our aggregate purchases in 2018.  No other partner accounted for more than 10% of purchases in 2018.  Our top five partners as a group for 2018 were Microsoft, Cisco Systems, Tech Data (a distributor), HP Inc. and Ingram Micro (a distributor), and approximately 60% of our total purchases during 2018 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 $57,448,000, $47,053,000 and $37,565,000 was recorded in 2018, 2017 and 2016, 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).  Forfeitures are recognized as they occur.  

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,
	2018		2017		2016
Numerator:
Net earnings	$	163,677	$	90,683	$	84,690
Denominator:
Weighted-average shares used to compute basic    EPS		35,586		35,741		36,102
Dilutive potential common shares due to dilutive    RSUs, net of tax effect		423		466		336
Weighted-average shares used to compute    diluted EPS		36,009		36,207		36,438
Net earnings per share:
Basic	$	4.60	$	2.54	$	2.35
Diluted	$	4.55	$	2.50	$	2.32

In 2018, 2017 and 2016, approximately 17,000, 40,000 and 36,000, 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 August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2018-15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.”  The new standard requires that implementation costs incurred by customers in cloud computing arrangements are deferred if they would be capitalized by customers in software licensing arrangements under the internal-use software guidance.  The new standard is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted.  We adopted this new standard in the fourth quarter of 2018 and applied it retrospectively.  The adoption of this standard did not have a material effect on our consolidated financial statements.

In July 2018, the FASB issued ASU No. 2018-09, “Codification Improvements,” which clarifies and corrects unintended application of guidance and makes improvement to Codification Topics.  There are various effective dates beginning with the ASU release date.  We adopted the standard in 2018.  The standard did not have a material effect on our consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.”  The new standard provides a new framework for determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.  The new standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted.  We adopted the standard in the first quarter of 2018.  The standard did not have a material effect on our consolidated financial statements.    

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 adopted the standard in the first quarter of 2018. The standard did not have a material effect on our consolidated financial statements.

As a result of the adoption of ASU No. 2016-18, we began including amounts generally described as restricted cash or restricted cash equivalents with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown in the statement of cash flows for the twelve months ended December 31, 2018.  Amounts shown in the consolidated statements of cash flows for the twelve months ended December 31, 2017 and 2016 were reclassified to conform to the current period presentation.  The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the years ended December 31, 2018, 2017 and 2016 (in thousands):

	December 31, 2018		December 31, 2017		December 31, 2016
Cash and cash equivalents	$	142,655	$	105,831	$	202,882
Restricted cash included in other current assets		8		46		51
Restricted cash included in other non-current assets		1,630		1,568		3,013
Total cash, cash equivalents and restricted cash    shown in the statement of cash flows	$	144,293	$	107,445	$	205,946

Amounts included in restricted cash represent those required to be set aside by a contractual agreement with a lessor related to certain leased office space in foreign jurisdictions.  Restricted cash shown in the statement of cash flows for the year ended December 31, 2017 also includes funds deposited with a financial institution in Australia to provide a guarantee on our behalf as security for any funds we might draw under our revolving loan facility in China.  The deposited funds were restricted in that we could not withdraw them as long as the related loan facility was in place.  These amounts were reported in other non-current assets.

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 adopted the new standard in the first quarter of 2018. The standard did not have a material effect on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which supersedes the existing lease recognition requirements in the current accounting standard for leases.  The core principal of the new standard is that an entity should recognize right-of-use (“ROU”) assets and lease liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures.  The new standard is to be applied using a modified retrospective transition method with the option to elect a number of practical expedients.  The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years.

In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842) – Targeted Improvements.” ASU 2018-11 provides additional guidance to Topic 842 including providing preparers an additional optional retrospective adoption method which allows entities to initially apply the new leases standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings. ASU 2018-11 also provides lessors a practical expedient to not separate lease from non-lease components, in certain situations.

We will adopt the new lease standard as of January 1, 2019 and plan to utilize the retrospective cumulative effect adjustment transition method with a cumulative effect adjustment being recorded as of the adoption date.  We expect to elect certain available practical expedients including the package of practical expedients permitted under the transition guidance within the new standard, which among other things, will allow us to carry forward the historical lease classification.  Additionally, we will make an accounting policy election to not record ROU assets and lease liabilities for leases with an initial term of twelve months or less on our consolidated balance sheet.  

We have established a cross-functional implementation team and are in the process of finalizing the scope of arrangements that will be subject to this standard as well as assessing the impact to our systems, processes, and internal controls over financial reporting.  While we are still evaluating the impact of adopting ASU No. 2016-02, we anticipate this standard will have a material impact on our other assets and other liabilities balances.  The primary impact will be to record ROU assets and lease liabilities for existing operating leases on our consolidated balance sheets.  Currently, we estimate adoption of the standard will result in recognition of additional ROU assets and lease liabilities of between approximately $70 million and $80 million, each, as of January 1, 2019.  

We do not expect the adoption to have a material impact on our consolidated statements of operations or our consolidated statements of cash flows.  We do not believe the standard will have a notable impact on our liquidity.  The standard will have no impact on our debt-covenant compliance under our current agreements.  Our analysis and evaluation of the new standard will continue through its effective date in the first quarter of 2019, including continuing to monitor any potential changes in the standard proposed by the FASB.  

In January 2016, the FASB issued 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 adopted the standard in the first quarter of 2018. 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.  We adopted the standard in the first quarter of 2018.  See Note 2 for further discussion.

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Operations and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

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

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,
	2018		2017		2016
Numerator:
Net earnings	$	163,677	$	90,683	$	84,690
Denominator:
Weighted-average shares used to compute basic    EPS		35,586		35,741		36,102
Dilutive potential common shares due to dilutive    RSUs, net of tax effect		423		466		336
Weighted-average shares used to compute    diluted EPS		36,009		36,207		36,438
Net earnings per share:
Basic	$	4.60	$	2.54	$	2.35
Diluted	$	4.55	$	2.50	$	2.32

Schedule of Reconciliation of Cash, Cash Equivalents and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the years ended December 31, 2018, 2017 and 2016 (in thousands):

	December 31, 2018		December 31, 2017		December 31, 2016
Cash and cash equivalents	$	142,655	$	105,831	$	202,882
Restricted cash included in other current assets		8		46		51
Restricted cash included in other non-current assets		1,630		1,568		3,013
Total cash, cash equivalents and restricted cash    shown in the statement of cash flows	$	144,293	$	107,445	$	205,946

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New Accounting Standard - Sales Recognition (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Revenue Disaggregated by Reportable Operating Segments

In the following table, revenue is disaggregated by our reportable operating segments, which are primarily defined bytheir related geographies, as well as by major product offering, by major client group and by recognition on either a gross basis as a principal in the arrangement, or on a net basis as an agent, for the year ended December 31, 2018 (in thousands):

	Year Ended December 31, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	3,610,356	$	653,499	$	29,496	$	4,293,351
Software		1,112,715		736,509		107,363		1,956,587
Services		639,910		140,233		50,055		830,198
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136
Major Client Groups
Large Enterprise / Corporate	$	3,951,900	$	1,134,696	$	49,826	$	5,136,422
Public Sector		498,873		327,818		76,567		903,258
Small and Medium-Sized Businesses		912,208		67,727		60,521		1,040,456
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	5,143,228	$	1,439,979	$	164,394	$	6,747,601
Net revenue recognition (Agent)		219,753		90,262		22,520		332,535
	$	5,362,981	$	1,530,241	$	186,914	$	7,080,136

Summary of Information about Receivables, Contract Assets and Contract Liabilities

The following table provides information about receivables, contract assets and contract liabilities as of December 31, 2018 and January 1, 2018 (in thousands):

	December 31,		January 1,
	2018		2018
Current receivables, which are included in “Accounts    receivable, net”	$	1,931,736	$	1,909,074
Non-current receivables, which are included in “Other assets”		38,157		32,227
Contract assets, which are included in “Other current    assets”		892		595
Contract liabilities, which are included in “Deferred    revenue” and “Other liabilities”		82,117		86,743

Summary of Changes in Contract Assets and Contract Liabilities from Contract with Customers

Significant changes in the contract assets and the contract liabilities balances during the year ended December 31, 2018 are as follows (in thousands):

	Increase (Decrease)
	Contract			Contract
	Assets			Liabilities
Balances at January 1, 2018	$	595		$	86,743
Reclassification of the beginning contract liabilities    to revenue, as the result of performance    obligations satisfied		—			(72,779	)
Cash received in advance and not recognized as    revenue		—			68,153
Reclassification of the beginning contract assets to   receivables, as the result of rights to consideration    becoming unconditional		(595	)		—
Contract assets recognized, net of reclassification to    receivables		892			—
Balances at December 31, 2018	$	892		$	82,117

Summary of Estimated Net Sales Related to Performance Obligation

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2018 that are expected to be recognized in the future (in thousands):

	Products		Services		Total
2019		13		88,998		89,011
2020		5		28,906		28,911
2021		—		11,251		11,251
2022		—		4,413		4,413
2023		—		1,841		1,841
2024 and thereafter		—		376		376
Total remaining performance obligations	$	18	$	135,785	$	135,803

Accounting Standards Update 2014-09 [Member]

Summary of Impact of Adoption of Topic 606 On Financial Statements

BALANCE SHEET AT DECEMBER 31, 2018

							Pre-Topic 606
	As Reported			Adjustments			Adoption
Cash and cash equivalents	$	142,655		$	—		$	142,655
Accounts receivable, net		1,931,736			(145,184	)		1,786,552
Inventories		148,503			—			148,503
Inventories not available for sale		—			118,936			118,936
Other current assets		115,683			39,684			155,367
Total current assets		2,338,577			13,436			2,352,013
Property and equipment, net		72,954			—			72,954
Goodwill		166,841			—			166,841
Intangible assets, net		112,179			—			112,179
Deferred income taxes		7,967			—			7,967
Other assets		77,429			(13,762	)		63,667
	$	2,775,947		$	(326	)	$	2,775,621
Accounts payable – trade	$	978,104		$	(84,504	)	$	893,600
Accounts payable – inventory financing facility		304,130			—			304,130
Accrued expenses and other current liabilities		190,733			(16,557	)		174,176
Current portion of long-term debt		1,395			—			1,395
Deferred revenue		62,300			121,526			183,826
Total current liabilities		1,536,662			20,465			1,557,127
Long-term debt		195,525			—			195,525
Deferred income taxes		683			—			683
Other liabilities		56,088			(11,443	)		44,645
		1,788,958			9,022			1,797,980
Stockholders’ equity:
Preferred stock		—			—			—
Common stock		355			—			355
Additional paid-in capital		323,622			—			323,622
Retained earnings		704,665			(9,311	)		695,354
Accumulated other comprehensive loss – foreign    currency translation adjustments		(41,653	)		(37	)		(41,690	)
Total stockholders’ equity		986,989			(9,348	)		977,641
	$	2,775,947		$	(326	)	$	2,775,621

STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2018

						Pre-Topic 606
	As Reported		Adjustments			Adoption
Net sales:
Products	$	6,249,938	$	49,497		$	6,299,435
Services		830,198		(11,675	)		818,523
Total net sales		7,080,136		37,822			7,117,958
Costs of goods sold:
Products		5,711,400		39,616			5,751,016
Services		375,018		479			375,497
Total costs of goods sold		6,086,418		40,095			6,126,513
Gross profit		993,718		(2,273	)		991,445
Operating expenses:
Selling and administrative expenses		756,529		373			756,902
Severance and restructuring expenses		3,424		—			3,424
Acquisition-related expenses		282		—			282
Earnings from operations		233,483		(2,646	)		230,837
Non-operating expense, net		21,581		8			21,589
Earnings before income taxes		211,902		(2,654	)		209,248
Income tax expense		48,225		(519	)		47,706
Net earnings	$	163,677	$	(2,135	)	$	161,542
Net earnings per share:
Basic	$	4.60	$	(0.06	)	$	4.54
Diluted	$	4.55	$	(0.06	)	$	4.49
Shares used in per share calculations:
Basic		35,586		—			35,586
Diluted		36,009		—			36,009

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Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2018

Property Plant And Equipment [Abstract]

Property and Equipment

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

	December 31,
	2018			2017
Software	$	170,327		$	171,701
Buildings		64,263			65,468
Equipment		100,421			103,542
Furniture and fixtures		38,200			38,459
Leasehold improvements		26,319			25,981
Land		5,124			5,179
		404,654			410,330
Accumulated depreciation and amortization		(331,700	)		(335,078	)
Property and equipment, net	$	72,954		$	75,252

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Goodwill (Tables)

12 Months Ended

Dec. 31, 2018

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, 2018 are as follows (in thousands):

	North America			EMEA			APAC			Consolidated
Goodwill	$	379,110		$	151,439		$	20,930		$	551,479
Accumulated impairment losses	$	(323,422	)	$	(151,439	)	$	(13,973	)	$	(488,834	)
Goodwill acquired during 2017		64,140			4,041			605			68,786
Balance at December 31, 2017		119,828			4,041			7,562			131,431
Goodwill acquired during 2018		36,440			(108	)		—			36,332
Foreign currency translation adjustment		—			(184	)		(738	)		(922	)
Balance at December 31, 2018	$	156,268		$	3,749		$	6,824		$	166,841

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Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2018

Goodwill And Intangible Assets Disclosure [Abstract]

Summary of Intangible Assets, Net

Intangible assets consist of the following (in thousands):

	December 31,
	2018			2017
Customer relationships	$	159,566		$	133,660
Other		5,555			4,475
		165,121			138,135
Accumulated amortization		(52,942	)		(37,357	)
Intangible assets, net	$	112,179		$	100,778

Future Amortization Expenses

Future amortization expense for the remaining unamortized balance as of December 31, 2018 is estimated as follows (in thousands):

Years Ending December 31,	Amortization Expense
2019	$	14,602
2020		14,590
2021		14,429
2022		14,256
2023		13,831
Thereafter		40,471
Total amortization expense	$	112,179

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Debt, Capital Lease and Other Financing Obligations (Tables)

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Long-Term Debt

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

	December 31,
	2018			2017
Senior revolving credit facility	$	—		$	117,500
Term Loan A (less unamortized debt issuance costs of $873 in    2017)		—			165,377
Accounts receivable securitization financing facility		194,000			25,000
Capital leases and other financing obligations		2,920			5,291
Total		196,920			313,168
Less: current portion of long-term debt		(1,395	)		(16,592	)
Long-term debt	$	195,525		$	296,576

Schedule of Future Minimum Lease Payments for Capital Leases

Future minimum payments under the capitalized leases consist of the following as of December 31, 2018 (in thousands):

Years Ending December 31,
2019	$	1,488
2020		1,151
2021		432
Total minimum lease payments		3,071
Less amount representing interest		(151	)
Present value of minimum lease payments	$	2,920

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Operating Leases (Tables)

12 Months Ended

Dec. 31, 2018

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, 2018 are as follows (in thousands):

Years Ending December 31,
2019	$	21,499
2020		15,580
2021		12,121
2022		9,150
2023		6,296
Thereafter		7,238
Total minimum lease payments	$	71,884

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Severance and Restructuring Activities (Tables)

12 Months Ended

Dec. 31, 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, 2018 related to these resource actions, and the outstanding obligations as of December 31, 2018 (in thousands):

	North America			EMEA			APAC			Consolidated
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
Severance costs, net of adjustments		1,617			1,677			130			3,424
Cash payments		(2,003	)		(3,386	)		(145	)		(5,534	)
Foreign currency translation adjustments		(41	)		(37	)		—			(78	)
Balances at December 31, 2018	$	1,204		$	1,248		$	—		$	2,452

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Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2018

Disclosure Of Compensation Related Costs Sharebased 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,
	2018		2017		2016
North America	$	11,697	$	9,697	$	8,096
EMEA		3,170		2,737		2,530
APAC		488		392		432
Total Consolidated	$	15,355	$	12,826	$	11,058

Summary of Restricted Stock Units Activity

The following table summarizes our RSU activity during 2018:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at the beginning of year		892,113		$	32.86
Granted		557,823		$	36.79
Vested, including shares withheld to cover taxes		(383,672	)	$	29.80	$	14,302,223	(a)
Forfeited		(45,334	)	$	34.10
Nonvested at the end of year		1,020,930		$	36.10	$	41,602,898	(b)

^(f) 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 2017 and 2016 was $20,284,762 and $9,235,102, respectively.

^(g) 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 $40.75as of December 31, 2018, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.  

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Earning Before IncomeTaxes and Related Income Tax Expenses

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):

	Years Ended December 31,
	2018			2017			2016
Earnings before income taxes:
United States	$	145,907		$	119,330		$	99,095
Foreign		65,995			39,768			40,363
	$	211,902		$	159,098		$	139,458
Income tax expense:
Current:
U.S. Federal	$	18,334		$	31,067		$	27,947
U.S. State and local		3,218			3,636			2,200
Foreign		17,547			14,573			14,104
		39,099			49,276			44,251
Deferred:
U.S. Federal		8,123			20,327			10,395
U.S. State and local		1,142			(427	)		1,088
Foreign		(139	)		(761	)		(966	)
		9,126			19,139			10,517
	$	48,225		$	68,415		$	54,768

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):

	2018					2017					2016
Statutory federal income tax rate	$	44,499		21.0	%	$	55,684		35.0	%	$	48,810		35.0	%
State income tax expense, net of    federal income tax benefit		6,767		3.2			2,808		1.8			3,368		2.4
Audits and adjustments, net		2,659		1.3			(313	)	(0.2	)		(1,039	)	(0.7	)
Change in valuation allowances		60		—			2,472		1.5			3,742		2.7
Foreign income taxed at different rates		2,639		1.2			(6,057	)	(3.8	)		(6,611	)	(4.7	)
U.S. mandatory deemed repatriation		(1,396	)	(0.7	)		5,625		3.5			—		—
Adjustment of net deferred tax assets    for enacted U.S. federal tax reform		(4,198	)	(2.0	)		7,738		4.9			—		—
Research and development credits		(4,132	)	(1.9	)		—		—			—		—
Change in U.S. tax law applicable to    certain foreign entities		—		—			—		—			2,577		1.8
Non-deductible compensation		1,399		0.7			571		0.4			518		0.4
Other, net		(72	)	—			(113	)	(0.1	)		3,403		2.4
Effective tax rate	$	48,225		22.8	%	$	68,415		43.0	%	$	54,768		39.3	%

Significant Components of Deferred Tax Assets and Liabilities

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

	December 31,
	2018			2017
Deferred tax assets:
Net operating losses	$	23,926		$	25,418
Foreign tax credits		16,800			21,346
Accruals		4,242			5,921
Stock-based compensation		3,173			3,023
Property and equipment		2,008			1,111
Accounts receivable		1,980			2,124
Goodwill and other intangibles		1,296			4,717
Deferred revenue		1,016			600
Inventories		133			1,930
Other		2,487			335
Gross deferred tax assets		57,061			66,525
Valuation allowances		(40,630	)		(45,995	)
Total deferred tax assets		16,431			20,530
Deferred tax liabilities:
Inventories		(4,885	)		—
Accrued withholding tax		(1,303	)		(1,452	)
Goodwill and other intangibles		(1,202	)		(1,587	)
Other		(1,757	)		(1,144	)
Total deferred tax liabilities		(9,147	)		(4,183	)
Net deferred tax assets	$	7,284		$	16,347

Net Non-Current Deferred Tax Assets and Liabilities

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

	December 31,
	2018			2017
Net non-current deferred tax assets	$	7,967		$	17,064
Net non-current deferred tax liabilities		(683	)		(717	)
Net deferred tax assets	$	7,284		$	16,347

Change in Valuation Allowance

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

	December 31,
	2018			2017
Valuation allowances at beginning of year	$	45,995		$	30,972
Increase in income tax expense		60			2,472
U.S. federal tax reform		(1,589	)		11,623
Foreign currency translation adjustments		(1,180	)		2,865
Other		(2,656	)		(1,937	)
Valuation allowances at end of year	$	40,630		$	45,995

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, 2017	$	3,986
Additions for tax positions in prior periods		1,613
Additions for tax positions in current period		2,014
Subtractions due to foreign currency translation		(8	)
Subtractions due to audit settlements and statute expirations		(1,069	)
Balance at December 31, 2018	$	6,536

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Share Repurchase Programs (Tables)

12 Months Ended

Dec. 31, 2018

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, 2018, 2017 and 2016, respectively, in thousands, except per share amounts:

Year	Total Number of Shares Purchased		Average Price Paid per Share		Approximate Dollar Value of Shares Purchased
2018		641	$	34.42	$	22,069
2017		—		—		—
2016		1,891		26.43		50,000
Total		2,532			$	72,069

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Supplemental Financial Information (Tables)

12 Months Ended

Dec. 31, 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 2018, 2017 and 2016 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, 2018	$	10,158	$	4,776	$	(4,472	)	$	10,462
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

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Cash Flows (Tables)

12 Months Ended

Dec. 31, 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,
	2018		2017		2016
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$	10,155	$	10,976	$	3,782
Cash paid during the year for income taxes, net of    refunds	$	31,218	$	55,470	$	39,051

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Segment and Geographic Information (Tables)

12 Months Ended

Dec. 31, 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 by sales mix amounts (in thousands):

	North America
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	3,610,356	$	3,352,355	$	2,454,889
Software		1,112,715		1,310,118		1,146,808
Services		639,910		519,261		370,131
	$	5,362,981	$	5,181,734	$	3,971,828

	EMEA
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	653,499	$	536,500	$	481,505
Software		736,509		710,452		762,427
Services		140,233		108,464		94,628
	$	1,530,241	$	1,355,416	$	1,338,560

	APAC
	Years Ended December 31,
Sales Mix	2018		2017		2016
Hardware	$	29,496	$	27,907	$	18,916
Software		107,363		101,412		132,718
Services		50,055		37,154		23,493
	$	186,914	$	166,473	$	175,127

Financial Information about Reportable Operating Segments

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

	Year Ended December 31, 2018
	North America		EMEA		APAC		Consolidated
Net Sales:
Products	$	4,723,071	$	1,390,008	$	136,859	$	6,249,938
Services		639,910		140,233		50,055		830,198
Total net sales		5,362,981		1,530,241		186,914		7,080,136
Costs of goods sold:
Products		4,313,070		1,273,422		124,908		5,711,400
Services		317,216		35,352		22,450		375,018
Total costs of goods sold		4,630,286		1,308,774		147,358		6,086,418
Gross profit		732,695		221,467		39,556		993,718
Operating expenses:
Selling and administrative expenses		545,091		182,470		28,968		756,529
Severance and restructuring expenses		1,617		1,677		130		3,424
Acquisition-related expenses		282		—		—		282
Earnings from operations	$	185,705	$	37,320	$	10,458	$	233,483

	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

	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

Summary of Total Assets by Reportable Operating Segment

The following table is a summary of our total assets by reportable operating segment (in thousands):

	December 31, 2018			December 31, 2017
North America	$	2,660,886		$	2,337,573
EMEA		611,338			530,242
APAC		98,959			101,169
Corporate assets and intercompany eliminations, net		(595,236	)		(283,333	)
Total assets	$	2,775,947		$	2,685,651

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
2018
Net sales	$	5,100,456	$	843,145	$	1,136,535	$	7,080,136
Total long-lived assets	$	52,346	$	12,434	$	8,174	$	72,954
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

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,
	2018		2017		2016
Depreciation and amortization of property and    equipment:
North America	$	17,164	$	20,241	$	21,952
EMEA		4,058		5,025		4,908
APAC		499		521		633
		21,721		25,787		27,493
Amortization of intangible assets:
North America		14,791		15,971		8,139
EMEA		285		73		1,951
APAC		661		768		547
		15,737		16,812		10,637
Total	$	37,458	$	42,599	$	38,130

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Acquisitions (Tables)

12 Months Ended

Dec. 31, 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
Net sales	As reported	$	6,703,623	$	5,485,515
	Proforma	$	6,707,533	$	6,084,484
Net earnings	As reported	$	90,683	$	84,690
	Proforma	$	92,276	$	85,823
Diluted earnings per share	As reported	$	2.50	$	2.32
	Proforma	$	2.55	$	2.36

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Selected Quarterly Financial Information (Tables)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Consolidated Quarterly Financial Information

The following tables set forth selected unaudited consolidated quarterly financial information for 2018 and 2017 (in thousands, except per share data):

	Quarters Ended
	December 31, 2018			September 30, 2018			June 30, 2018 (1)			March 31, 2018 (1)
Net sales	$	1,749,046		$	1,747,726		$	1,840,870		$	1,742,494
Costs of goods sold		1,494,882			1,512,812			1,576,493			1,502,231
Gross profit		254,164			234,914			264,377			240,263
Operating expenses:
Selling and administrative expenses		194,790			184,095			189,464			188,180
Severance and restructuring expenses		715			683			382			1,644
Acquisition-related expenses		—			188			94			—
Earnings from operations		58,659			49,948			74,437			50,439
Non-operating (income) expense:
Interest income		(422	)		(330	)		(170	)		(153	)
Interest expense		5,563			6,132			5,102			6,015
Net foreign currency exchange (gain) loss		(1,517	)		539			(275	)		(245	)
Other expense, net		323			393			324			302
Earnings before income taxes		54,712			43,214			69,456			44,520
Income tax expense		7,671			11,060			17,977			11,517
Net earnings	$	47,041		$	32,154		$	51,479		$	33,003
Net earnings per share:
Basic	$	1.33		$	0.91		$	1.45		$	0.92
Diluted	$	1.31		$	0.89		$	1.44		$	0.91
Shares used in per share calculations:
Basic		35,480			35,468			35,483			35,913
Diluted		35,999			35,957			35,815			36,263

	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

(1) During the quarter ended September 30, 2018, we revised our previously issued March 31, 2018 and June 30, 2018 consolidated financial statements for immaterial errors identified.  The errors primarily relate to incorrect presentation of certain software revenue transactions.  The effect of the revision on our consolidated statements of operations for the three months ended March 31, 2018 was to reduce product net sales by $24,364,000, increase services net sales by $3,953,000, reduce product cost of goods sold by $23,749,000 and increase services cost of goods sold by $3,080,000.  For the three months ended March 31, 2018, gross profit, earnings from operations and net earnings increased by $258,000.  Diluted earnings per share for the three months ended March 31, 2018 increased $0.01.

The effect of the revision on our consolidated statement of operations for the three months ended June 30, 2018 was to reduce product net sales by $949,000, increase services net sales by $4,900,000, reduce product cost of goods sold by $532,000 and increase services cost of goods sold by $4,483,000.  The effect of the revision on our consolidated statement of operations for the six months ended June 30, 2018 was to reduce product net sales by $25,313,000, increase services net sales by $8,853,000, reduce product cost of goods sold by $24,281,000 and increase services cost of goods sold by $7,563,000.  For the three months ended June 30, 2018, there was no impact to gross profit, earnings from operations or net earnings resulting from the revision.  For the six months ended June 30, 2018, gross profit, earnings from operations and net earnings increased by $258,000.  There was no impact to diluted earnings per share in either the three or six months ended June 30, 2018.

These revisions are appropriately reflected in the consolidated statement of operations for the year ended December 31, 2018.  There is no impact to the audited consolidated financial statements for 2017, 2016 or any other prior period.

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Operations and Summary of Significant Accounting Policies - Additional Information (Detail)					12 Months Ended
	Aug. 01, 2018 USD ($)	Sep. 26, 2017 USD ($)	Jan. 06, 2017 USD ($)	Sep. 01, 2016 USD ($)	Dec. 31, 2018 USD ($) Segment shares	Dec. 31, 2017 USD ($) shares	Dec. 31, 2016 USD ($) shares	Jan. 01, 2019 USD ($)
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Number of operating segments | Segment					3
Acquisitions, net of cash and cash equivalents acquired					$ 74,938,000	$ 186,932,000	$ 10,297,000
Partner funding recorded as reduction of selling and administrative expenses					68,571,000	53,227,000	48,114,000
Advertising expense					$ 57,448,000	$ 47,053,000	$ 37,565,000
Restricted Stock Units (RSUs) [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
RSUs excluded from the diluted EPS calculations | shares					17,000	40,000	36,000
Maximum [Member] | Accounting Standards Update 2016-02 [Member] | Proforma [Member] | Subsequent Event [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Estimated additional ROU assets								$ 80,000,000
Estimated additional lease liabilities								80,000,000
Minimum [Member] | Accounting Standards Update 2016-02 [Member] | Proforma [Member] | Subsequent Event [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Estimated additional ROU assets								70,000,000
Estimated additional lease liabilities								$ 70,000,000
Credit Risk [Member] | Net Sales [Member] | Single Customer [Member] | Maximum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					4.00%
Supplier Risk [Member] | Purchases [Member] | Microsoft [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					26.00%
Supplier Risk [Member] | Purchases [Member] | Top Five Suppliers [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					60.00%
Supplier Risk [Member] | Purchases [Member] | Maximum [Member] | Significant Supplier [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Concentration percentage					10.00%
Cardinal Solutions Group, Inc [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Acquisitions, net of cash and cash equivalents acquired	$ 78,800,000
Business acquisition, effective date of acquisition	Aug. 01, 2018
Caase Group, B.V. [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Acquisitions, net of cash and cash equivalents acquired		$ 6,038,000
Business acquisition, effective date of acquisition		Sep. 26, 2017
Datalink Corporation [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Acquisitions, net of cash and cash equivalents acquired			$ 257,456,000
Business acquisition, effective date of acquisition			Jan. 06, 2017
Payments to acquire businesses, net of cash and cash equivalents acquired			$ 76,597,000
Ignia Pty Ltd [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Acquisitions, net of cash and cash equivalents acquired				$ 10,804,000
Business acquisition, effective date of acquisition				Sep. 01, 2016

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Operations and Summary of Significant Accounting Policies - Estimated Economic Lives of Property and Equipment (Detail)	12 Months Ended
	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Leasehold improvements	Shorter of underlying lease term or asset life
Furniture and fixtures [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful Life	2 years
Furniture and fixtures [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful Life	7 years
Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Software [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Software [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful Life	10 years
Buildings [Member]
Property, Plant and Equipment [Line Items]
Useful Life	29 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, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Numerator:
Net earnings	$ 47,041	$ 32,154	$ 51,479	$ 33,003	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 163,677	$ 90,683	$ 84,690
Denominator:
Weighted-average shares used to compute basic EPS	35,480	35,468	35,483	35,913	35,809	35,787	35,765	35,602	35,586	35,741	36,102
Dilutive potential common shares due to dilutive RSUs, net of tax effect									423	466	336
Weighted-average shares used to compute diluted EPS	35,999	35,957	35,815	36,263	36,272	36,203	36,169	36,185	36,009	36,207	36,438
Net earnings per share:
Basic	$ 1.33	$ 0.91	$ 1.45	$ 0.92	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 4.60	$ 2.54	$ 2.35
Diluted	$ 1.31	$ 0.89	$ 1.44	$ 0.91	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 4.55	$ 2.50	$ 2.32

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Operations and Summary of Significant Accounting Policies - Schedule of Reconciliation of Cash, Cash Equivalents and Restricted Cash (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash And Cash Equivalents [Abstract]
Cash and cash equivalents	$ 142,655	$ 105,831	$ 202,882
Restricted cash included in other current assets	8	46	51
Restricted cash included in other non-current assets	1,630	1,568	3,013
Total cash, cash equivalents and restricted cash shown in the statement of cash flows	$ 144,293	$ 107,445	$ 205,946

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New Accounting Standard - Sales Recognition - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Jan. 01, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative impact of adoption of accounting standards in retained earnings	$ 704,665,000	$ 550,220,000
Net cash provided by (used in) operating activities	292,647,000	(307,066,000)	$ 96,077,000
Net cash used in investing activities	(91,710,000)	(204,645,000)	(21,185,000)
Net cash (used in) provided by financing activities	$ (159,028,000)	$ 397,121,000	$ (58,230,000)
Description of expected duration	Topic 606 allows for certain practical expedients which we have elected to apply. As a result, with the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, we do not disclose information about remaining performance obligations that have original expected durations of one year or less in the table above. Amounts not included in the table above have an average original expected duration of eight months.
Time and material contracts expected duration	12 months
Performance period of contracts	1 year
Related asset balance	$ 2,763,000
Expected recognition period of related asset	36 months
Contract period	The majority of our contracts are completed within a one-year performance period, and for contracts with a specified term of one year or less
Revenue, practical expedient, incremental cost of obtaining contract	true
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative impact of adoption of accounting standards in retained earnings	$ 9,311,000			$ 7,176,000
Net cash provided by (used in) operating activities	0
Net cash used in investing activities	0
Net cash (used in) provided by financing activities	$ 0

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New Accounting Standard - Sales Recognition - Summary of Impact of Adoption of Topic 606 On Balance Sheet (Detail) - USD ($)	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Cash and cash equivalents	$ 142,655,000		$ 105,831,000	$ 202,882,000
Accounts receivable, net	1,931,736,000		1,814,560,000
Inventories	148,503,000		194,529,000
Inventories not available for sale			36,956,000
Other current assets	115,683,000		152,467,000
Total current assets	2,338,577,000		2,304,343,000
Property and equipment, net	72,954,000		75,252,000
Goodwill	166,841,000		131,431,000
Intangible assets, net	112,179,000		100,778,000
Deferred income taxes	7,967,000		17,064,000
Other assets	77,429,000		56,783,000
Total assets	2,775,947,000		2,685,651,000
Accounts payable—trade	978,104,000		899,075,000
Accounts payable—inventory financing facility	304,130,000		319,468,000
Accrued expenses and other current liabilities	190,733,000		175,860,000
Current portion of long-term debt	1,395,000		16,592,000
Deferred revenue	62,300,000		88,979,000
Total current liabilities	1,536,662,000		1,499,974,000
Long-term debt	195,525,000		296,576,000
Deferred income taxes	683,000		717,000
Other liabilities	56,088,000		44,915,000
Total liabilities	1,788,958,000		1,842,182,000
Stockholders’ equity:
Preferred stock
Common stock	355,000		358,000
Additional paid-in capital	323,622,000		317,155,000
Retained earnings	704,665,000		550,220,000
Accumulated other comprehensive loss – foreign currency translation adjustments	(41,653,000)		(24,264,000)
Total stockholders’ equity	986,989,000		843,469,000	$ 713,443,000	$ 685,742,000
Total liabilities and stockholders' equity	2,775,947,000		$ 2,685,651,000
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net	145,184,000
Inventories not available for sale	(118,936,000)
Other current assets	(39,684,000)
Total current assets	(13,436,000)
Other assets	13,762,000
Total assets	326,000
Accounts payable—trade	84,504,000
Accrued expenses and other current liabilities	16,557,000
Deferred revenue	(121,526,000)
Total current liabilities	(20,465,000)
Other liabilities	11,443,000
Total liabilities	(9,022,000)
Stockholders’ equity:
Preferred stock
Retained earnings	9,311,000	$ 7,176,000
Accumulated other comprehensive loss – foreign currency translation adjustments	37,000
Total stockholders’ equity	9,348,000
Total liabilities and stockholders' equity	326,000
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Accounting Standards Update 2014-09 [Member]
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Cash and cash equivalents	142,655,000
Accounts receivable, net	1,786,552,000
Inventories	148,503,000
Inventories not available for sale	118,936,000
Other current assets	155,367,000
Total current assets	2,352,013,000
Property and equipment, net	72,954,000
Goodwill	166,841,000
Intangible assets, net	112,179,000
Deferred income taxes	7,967,000
Other assets	63,667,000
Total assets	2,775,621,000
Accounts payable—trade	893,600,000
Accounts payable—inventory financing facility	304,130,000
Accrued expenses and other current liabilities	174,176,000
Current portion of long-term debt	1,395,000
Deferred revenue	183,826,000
Total current liabilities	1,557,127,000
Long-term debt	195,525,000
Deferred income taxes	683,000
Other liabilities	44,645,000
Total liabilities	1,797,980,000
Stockholders’ equity:
Preferred stock
Common stock	355,000
Additional paid-in capital	323,622,000
Retained earnings	695,354,000
Accumulated other comprehensive loss – foreign currency translation adjustments	(41,690,000)
Total stockholders’ equity	977,641,000
Total liabilities and stockholders' equity	$ 2,775,621,000

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New Accounting Standard - Sales Recognition - Summary of Impact of Adoption of Topic 606 On Statement of Operations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Net sales:
Total net sales	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Costs of goods sold:
Total costs of goods sold	1,494,882	1,512,812	1,576,493	1,502,231	1,551,192	1,531,892	1,432,653	1,269,316	6,086,418	5,785,053	4,742,413
Gross profit	254,164	234,914	264,377	240,263	232,883	226,081	251,379	208,227	993,718	918,570	743,102
Operating expenses:
Selling and administrative expenses	194,790	184,095	189,464	188,180	184,554	180,390	180,752	177,632	756,529	723,328	585,243
Severance and restructuring expenses	715	683	382	1,644	2,791	494	1,022	4,695	3,424	9,002	4,580
Acquisition-related expenses		188	94			106	276	2,947	282	3,329	4,447
Earnings from operations	58,659	49,948	74,437	50,439	45,538	41,445	69,329	22,953	233,483	179,265	148,832
Non-operating expense, net									21,581
Earnings before income taxes	54,712	43,214	69,456	44,520	40,274	35,437	64,631	18,756	211,902	159,098	139,458
Income tax expense	7,671	11,060	17,977	11,517	26,106	13,025	24,376	4,908	48,225	68,415	54,768
Net earnings	$ 47,041	$ 32,154	$ 51,479	$ 33,003	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 163,677	$ 90,683	$ 84,690
Net earnings per share:
Basic	$ 1.33	$ 0.91	$ 1.45	$ 0.92	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 4.60	$ 2.54	$ 2.35
Diluted	$ 1.31	$ 0.89	$ 1.44	$ 0.91	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 4.55	$ 2.50	$ 2.32
Shares used in per share calculations:
Basic	35,480	35,468	35,483	35,913	35,809	35,787	35,765	35,602	35,586	35,741	36,102
Diluted	35,999	35,957	35,815	36,263	36,272	36,203	36,169	36,185	36,009	36,207	36,438
Products [Member]
Net sales:
Total net sales									$ 6,249,938	$ 6,038,744	$ 4,997,263
Costs of goods sold:
Total costs of goods sold									5,711,400	5,512,402	4,571,462
Services [Member]
Net sales:
Total net sales									830,198	664,879	488,252
Costs of goods sold:
Total costs of goods sold									375,018	$ 272,651	$ 170,951
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member]
Net sales:
Total net sales									(37,822)
Costs of goods sold:
Total costs of goods sold									(40,095)
Gross profit									2,273
Operating expenses:
Selling and administrative expenses									(373)
Earnings from operations									2,646
Non-operating expense, net									8
Earnings before income taxes									2,654
Income tax expense									519
Net earnings									$ 2,135
Net earnings per share:
Basic									$ 0.06
Diluted									$ 0.06
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Products [Member] | Accounting Standards Update 2014-09 [Member]
Net sales:
Total net sales									$ (49,497)
Costs of goods sold:
Total costs of goods sold									(39,616)
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Services [Member] | Accounting Standards Update 2014-09 [Member]
Net sales:
Total net sales									11,675
Costs of goods sold:
Total costs of goods sold									(479)
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Accounting Standards Update 2014-09 [Member]
Net sales:
Total net sales									7,117,958
Costs of goods sold:
Total costs of goods sold									6,126,513
Gross profit									991,445
Operating expenses:
Selling and administrative expenses									756,902
Severance and restructuring expenses									3,424
Acquisition-related expenses									282
Earnings from operations									230,837
Non-operating expense, net									21,589
Earnings before income taxes									209,248
Income tax expense									47,706
Net earnings									$ 161,542
Net earnings per share:
Basic									$ 4.54
Diluted									$ 4.49
Shares used in per share calculations:
Basic									35,586
Diluted									36,009
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Products [Member] | Accounting Standards Update 2014-09 [Member]
Net sales:
Total net sales									$ 6,299,435
Costs of goods sold:
Total costs of goods sold									5,751,016
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Services [Member] | Accounting Standards Update 2014-09 [Member]
Net sales:
Total net sales									818,523
Costs of goods sold:
Total costs of goods sold									$ 375,497

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New Accounting Standard - Sales Recognition - Summary of Revenue Disaggregated by Reportable Operating Segments (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									6,747,601
Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									332,535
Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									5,136,422
Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									903,258
Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									1,040,456
Hardware Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									4,293,351
Software Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									1,956,587
Services Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									830,198
North America Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									5,362,981	5,181,734	3,971,828
North America Segment [Member] | Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									5,143,228
North America Segment [Member] | Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									219,753
North America Segment [Member] | Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									3,951,900
North America Segment [Member] | Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									498,873
North America Segment [Member] | Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									912,208
North America Segment [Member] | Hardware Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									3,610,356	3,352,355	2,454,889
North America Segment [Member] | Software Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									1,112,715	1,310,118	1,146,808
North America Segment [Member] | Services Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									639,910	519,261	370,131
EMEA Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									1,530,241	1,355,416	1,338,560
EMEA Segment [Member] | Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									1,439,979
EMEA Segment [Member] | Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									90,262
EMEA Segment [Member] | Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									1,134,696
EMEA Segment [Member] | Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									327,818
EMEA Segment [Member] | Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									67,727
EMEA Segment [Member] | Hardware Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									653,499	536,500	481,505
EMEA Segment [Member] | Software Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									736,509	710,452	762,427
EMEA Segment [Member] | Services Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									140,233	108,464	94,628
APAC Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									186,914	166,473	175,127
APAC Segment [Member] | Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									164,394
APAC Segment [Member] | Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									22,520
APAC Segment [Member] | Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									49,826
APAC Segment [Member] | Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									76,567
APAC Segment [Member] | Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									60,521
APAC Segment [Member] | Hardware Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									29,496	27,907	18,916
APAC Segment [Member] | Software Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									107,363	101,412	132,718
APAC Segment [Member] | Services Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue									$ 50,055	$ 37,154	$ 23,493

XML

New Accounting Standard - Sales Recognition - Summary of Information about Receivables,Contract Assets and Contract Liabilities (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017
Disaggregation of Revenue [Line Items]
Current receivables, which are included in “Accounts receivable, net”	$ 1,931,736		$ 1,814,560
Contract assets, which are included in “Other current assets”	892		595
Contract liabilities, which are included in “Deferred revenue” and “Other liabilities”	82,117		$ 86,743
Accounts Receivable, Net [Member]
Disaggregation of Revenue [Line Items]
Current receivables, which are included in “Accounts receivable, net”	1,931,736	$ 1,909,074
Other Assets [Member]
Disaggregation of Revenue [Line Items]
Non-current receivables, which are included in “Other assets”	38,157	32,227
Other Current Assets [Member]
Disaggregation of Revenue [Line Items]
Contract assets, which are included in “Other current assets”	892	595
Deferred Revenue and Other Liabilities [Member]
Disaggregation of Revenue [Line Items]
Contract liabilities, which are included in “Deferred revenue” and “Other liabilities”	$ 82,117	$ 86,743

XML

New Accounting Standard - Sales Recognition - Summary of Changes in Contract Assets and Contract Liabilities from Contract with Customers (Detail) $ in Thousands	12 Months Ended
	Dec. 31, 2018 USD ($)
Revenue From Contract With Customer [Abstract]
Beginning balance, Contract Assets	$ 595
Reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional, Contract Assets	(595)
Contract assets recognized, net of reclassification to receivables, Contract Assets	892
Ending balance, Contract Assets	892
Beginning balance, Contract Liabilities	86,743
Reclassification of the beginning contract liabilities to revenue, as the result of performance obligations satisfied, Contract Liabilities	(72,779)
Cash received in advance and not recognized as revenue, Contract Liabilities	68,153
Ending balance, Contract Liabilities	$ 82,117

XML

New Accounting Standard - Sales Recognition - Summary of Estimated Net Sales Related to Performance Obligation (Detail) $ in Thousands	Dec. 31, 2018 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 135,803
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2019-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 89,011
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 28,911
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 11,251
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 4,413
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 1,841
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 376
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period
Products [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 18
Products [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2019-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 13
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Products [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 5
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Services [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 135,785
Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2019-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 88,998
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 28,906
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 11,251
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 4,413
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 1,841
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 376
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period

XML

New Accounting Standard - Sales Recognition - Summary of Estimated Net Sales Related to Performance Obligation (Detail 1) $ in Thousands	Dec. 31, 2018 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 135,803
Products [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	18
Services [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 135,785

XML

Property and Equipment - Property and Equipment (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 404,654	$ 410,330
Accumulated depreciation and amortization	(331,700)	(335,078)
Property and equipment, net	72,954	75,252
Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	170,327	171,701
Buildings [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	64,263	65,468
Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	100,421	103,542
Furniture and fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	38,200	38,459
Leasehold improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	26,319	25,981
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 5,124	$ 5,179

XML

Property and Equipment - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Property Plant And Equipment [Abstract]
Non- cash charges to write-off certain property and equipment, primarily computer software development costs	$ 393,000	$ 418,000	$ 0
Depreciation and amortization expense	$ 21,721,000	$ 25,787,000	$ 27,493,000

XML

Goodwill - Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Goodwill [Line Items]
Beginning Balance	$ 131,431
Goodwill		$ 551,479
Accumulated impairment losses		(488,834)
Goodwill acquired during the year	36,332	68,786
Foreign currency translation adjustment	(922)
Ending Balance	166,841	131,431
North America Segment [Member]
Goodwill [Line Items]
Beginning Balance	119,828
Goodwill		379,110
Accumulated impairment losses		(323,422)
Goodwill acquired during the year	36,440	64,140
Ending Balance	156,268	119,828
EMEA Segment [Member]
Goodwill [Line Items]
Beginning Balance	4,041
Goodwill		151,439
Accumulated impairment losses		(151,439)
Goodwill acquired during the year		4,041
Goodwill acquired during the year	(108)
Foreign currency translation adjustment	(184)
Ending Balance	3,749	4,041
APAC Segment [Member]
Goodwill [Line Items]
Beginning Balance	7,562
Goodwill		20,930
Accumulated impairment losses		(13,973)
Goodwill acquired during the year		605	$ 6,957
Foreign currency translation adjustment	(738)
Ending Balance	$ 6,824	$ 7,562

XML

Goodwill - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Goodwill [Line Items]
Goodwill acquired during the year	$ 36,332	$ 68,786
North America Segment [Member]
Goodwill [Line Items]
Goodwill acquired during the year	$ 36,440	$ 64,140
Business acquisition, effective date of acquisition	Aug. 01, 2018	Jan. 06, 2017
EMEA Segment [Member]
Goodwill [Line Items]
Goodwill acquired during the year		$ 4,041
Business acquisition, effective date of acquisition		Sep. 26, 2017
APAC Segment [Member]
Goodwill [Line Items]
Goodwill acquired during the year		$ 605	$ 6,957
Business acquisition, effective date of acquisition			Sep. 01, 2016

XML

Intangible Assets - Summary of Intangible Assets, Net (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross	$ 165,121	$ 138,135
Accumulated amortization	(52,942)	(37,357)
Intangible assets, net	112,179	100,778
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross	159,566	133,660
Other [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross	$ 5,555	$ 4,475

XML

Intangible Assets - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
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
Reduction in gross intangible assets and accumulated amortization balances		$ 2,516,000
Amortization expense	$ 15,737,000	$ 16,812,000	$ 10,637,000

XML

Intangible Assets - Future Amortization Expenses (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Goodwill And Intangible Assets Disclosure [Abstract]
2019	$ 14,602
2020	14,590
2021	14,429
2022	14,256
2023	13,831
Thereafter	40,471
Intangible assets, net	$ 112,179	$ 100,778

XML

Accounts Payable - Inventory Financing Facility - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Mar. 23, 2018	Mar. 22, 2018
Accounts Payable And Accrued Expenses [Line Items]
Accounts payable—inventory financing facility	$ 304,130,000	$ 319,468,000
Inventory Financing Facility [Member]
Accounts Payable And Accrued Expenses [Line Items]
Inventory financing facility maximum borrowing capacity				$ 400,000,000	$ 325,000,000
Accounts payable—inventory financing facility	$ 304,130,000
Inventory financing facility maturity date	Jun. 23, 2021
Inventory financing facility, interest accrual basis, stated vendor term	60 days
Imputed interest on inventory financing facility	$ 10,593,000	$ 6,736,000	$ 3,385,000
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%

XML

Debt, Capital Lease and Other Financing Obligations - Long-Term Debt (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Long-term debt
Senior revolving credit facility		$ 117,500
Term Loan A (less unamortized debt issuance costs of $873 in 2017)		165,377
Accounts receivable securitization financing facility	$ 194,000	25,000
Capital leases and other financing obligations	2,920	5,291
Total	196,920	313,168
Less: current portion of long-term debt	(1,395)	(16,592)
Long-term debt	$ 195,525	$ 296,576

XML

Debt, Capital Lease and Other Financing Obligations - Long-Term Debt (Parenthetical) (Detail) $ in Thousands	Dec. 31, 2017 USD ($)
Debt Disclosure [Abstract]
Unamortized debt issuance cost	$ 873

XML

Debt, Capital Lease and Other Financing Obligations - Additional Information (Detail) - USD ($)		1 Months Ended	12 Months Ended
	Jan. 06, 2017	Oct. 31, 2018	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Debt Instrument [Line Items]
Accounts receivable securitization financing facility			$ 194,000,000	$ 25,000,000
Noncash capital lease excluded from consolidated statements of cash flows			977,000	977,000
Amount owed under other financing agreement			0	$ 2,489,000
Minimum [Member]
Debt Instrument [Line Items]
Capitalized lease term		30 month		36 month	36 month
Maximum [Member]
Debt Instrument [Line Items]
Capitalized lease term		33 month		40 month	40 month
Senior Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity			$ 350,000,000
Applicable floating interest rate			3.66%
Weighted average amount outstanding borrowings			$ 16,684,000	$ 63,604,000	$ 35,811,000
Amount available under line of credit facility			$ 350,000,000
Line of credit maturity date			Jun. 23, 2021
Credit facility, interest rate at period end			3.66%
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] | 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%
Senior Revolving Credit Facility [Member] | Datalink [Member]
Debt Instrument [Line Items]
Incremental borrowings under Term Loan A	$ 175,000,000
Senior Revolving Credit Facility [Member] | Foreign Currency Borrowings [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity			$ 50,000,000
Senior Revolving Credit Facility and Term Loan A [Member]
Debt Instrument [Line Items]
Interest expense			8,198,000	8,491,000	2,191,000
ABS Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity			250,000,000
Weighted average amount outstanding borrowings			$ 98,663,000	153,759,000	$ 145,376,000
Line of credit maturity date			Jun. 23, 2021
Line of credit maturity period			3 years
Receivables at fair value			$ 1,101,597,000	$ 1,141,520,000
Amount of facility permitted by qualified receivables			250,000,000
Accounts receivable securitization financing facility			$ 194,000,000
Credit facility, interest rate at period end			3.46%
Credit facility, usage fee			0.85%
Monthly commitment fee on unused portion of ABS facility			0.375%
Weighted average interest rate			3.60%	2.40%	1.90%
Outstanding borrowings at period end			$ 194,000,000
Senior Revolving Credit Facility Term Loan A and Asset Backed Securitization Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity			$ 600,000,000
Maximum leverage ratio times adjusted earnings			3.25

XML

Debt, Capital Lease and Other Financing Obligations - Schedule of Future Minimum Lease Payments for Capital Leases (Detail) $ in Thousands	Dec. 31, 2018 USD ($)
Capital Lease Obligations [Abstract]
2019	$ 1,488
2020	1,151
2021	432
Total minimum lease payments	3,071
Less amount representing interest	(151)
Present value of minimum lease payments	$ 2,920

XML

Operating Leases - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Leases [Abstract]
Operating leases rental expense	$ 20,114,000	$ 19,126,000	$ 14,444,000
Non-cancellable rental income, 2019	$ 1,600,000

XML

Operating Leases - Future Minimum Lease Payment (Detail) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
2019	$ 21,499
2020	15,580
2021	12,121
2022	9,150
2023	6,296
Thereafter	7,238
Total minimum lease payments	$ 71,884

XML

Severance and Restructuring Activities - Activity Related to Resource Actions and Outstanding Obligations (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Restructuring Cost and Reserve [Line Items]
Beginning balance	$ 4,640	$ 2,164	$ 3,488
Severance costs, net of adjustments	3,424	9,002	4,580
Cash payments	(5,534)	(7,022)	(5,881)
Foreign currency translation adjustments	(78)	496	(23)
Ending balance	2,452	4,640	2,164
North America Segment [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance	1,631	947	505
Severance costs, net of adjustments	1,617	4,010	2,966
Cash payments	(2,003)	(3,336)	(2,524)
Foreign currency translation adjustments	(41)	10
Ending balance	1,204	1,631	947
EMEA Segment [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance	2,994	1,217	2,983
Severance costs, net of adjustments	1,677	4,888	1,496
Cash payments	(3,386)	(3,597)	(3,239)
Foreign currency translation adjustments	(37)	486	(23)
Ending balance	1,248	2,994	1,217
APAC Segment [Member]
Restructuring Cost and Reserve [Line Items]
Beginning balance	15
Severance costs, net of adjustments	130	104	118
Cash payments	$ (145)	(89)	$ (118)
Ending balance		$ 15

XML

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, 2018	Dec. 31, 2017	Dec. 31, 2016
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	$ 15,355	$ 12,826	$ 11,058
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)	11,697	9,697	8,096
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)	3,170	2,737	2,530
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)	$ 488	$ 392	$ 432

XML

Stock-Based Compensation - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
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	2,791,688
Payments for teammates' tax obligations to taxing authorities	$ 3,230,000	$ 5,318,000	$ 2,219,000
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	$ 21,104,000
Weighted average number of years for recognition of outstanding nonvested RSUs	1 year 3 months 21 days
Shares withheld to cover taxes	88,638	122,255	84,953
Payments for teammates' tax obligations to taxing authorities	$ 3,230,000	$ 5,318,000	$ 2,219,000

XML

Stock-Based Compensation - Summary of Restricted Stock Units Activity (Detail) - Restricted Stock Units (RSUs) [Member] - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested Number, Beginning balance	892,113
Number, Granted	557,823
Number, Vested, including shares withheld to cover taxes	(383,672)
Number, Forfeited	(45,334)
Nonvested Number, Ending balance	1,020,930	892,113
Nonvested Weighted Average Grant Date Fair Value, Beginning balance	$ 32.86
Weighted Average Grant Date Fair Value, Granted	36.79
Weighted Average Grant Date Fair Value, Vested, including shares withheld to cover taxes	29.80
Weighted Average Grant Date Fair Value, Forfeited	34.10
Nonvested Weighted Average Grant Date Fair Value, Ending balance	$ 36.10	$ 32.86
Fair Value, Vested, including shares withheld to cover taxes	$ 14,302,223	$ 20,284,762	$ 9,235,102
Fair Value, Nonvested at end of period	$ 41,602,898

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Stock-Based Compensation - Summary of Restricted Stock Units Activity (Parenthetical) (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Closing stock price	$ 40.75
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value for vested shares of RSUs	$ 14,302,223	$ 20,284,762	$ 9,235,102

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Income Taxes - Income Tax Expense (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Current:
U.S. Federal									$ 18,334	$ 31,067	$ 27,947
U.S. State and local									3,218	3,636	2,200
Foreign									17,547	14,573	14,104
Total current income tax expense									39,099	49,276	44,251
Deferred:
U.S. Federal									8,123	20,327	10,395
U.S. State and local									1,142	(427)	1,088
Foreign									(139)	(761)	(966)
Total deferred income tax expense									9,126	19,139	10,517
Income tax expense	$ 7,671	$ 11,060	$ 17,977	$ 11,517	$ 26,106	$ 13,025	$ 24,376	$ 4,908	$ 48,225	$ 68,415	$ 54,768

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Income Taxes - Earnings Before Income Taxes (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Tax Disclosure [Abstract]
United States									$ 145,907	$ 119,330	$ 99,095
Foreign									65,995	39,768	40,363
Earnings before income taxes	$ 54,712	$ 43,214	$ 69,456	$ 44,520	$ 40,274	$ 35,437	$ 64,631	$ 18,756	$ 211,902	$ 159,098	$ 139,458

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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, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Effective Income Tax Rate Reconciliation, Amount [Abstract]
Statutory federal income tax rate, Amount									$ 44,499	$ 55,684	$ 48,810
State income tax expense, net of federal income tax benefit									6,767	2,808	3,368
Audits and adjustments, net									2,659	(313)	(1,039)
Change in valuation allowances									60	2,472	3,742
Foreign income taxed at different rates									2,639	(6,057)	(6,611)
U.S. mandatory deemed repatriation									(1,396)	5,625
Adjustment of net deferred tax assets for enacted U.S. federal tax reform									(4,198)	7,738
Research and development credits									(4,132)
Change in U.S. tax law applicable to certain foreign entities											2,577
Non-deductible compensation									1,399	571	518
Other, net									(72)	(113)	3,403
Income tax expense	$ 7,671	$ 11,060	$ 17,977	$ 11,517	$ 26,106	$ 13,025	$ 24,376	$ 4,908	$ 48,225	$ 68,415	$ 54,768
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Statutory federal income tax rate									21.00%	35.00%	35.00%
State income tax expense, net of federal income tax benefit, Rate									3.20%	1.80%	2.40%
Audits and adjustments, net, Rate									1.30%	(0.20%)	(0.70%)
Change in valuation allowances, Rate										1.50%	2.70%
Foreign income taxed at different rates, Rate									1.20%	(3.80%)	(4.70%)
U.S. mandatory deemed repatriation, Rate									(0.70%)	3.50%
Adjustment of net deferred tax assets for enacted U.S. federal tax reform, Rate									(2.00%)	4.90%
Research and development credits, Rate									(1.90%)
Change in U.S. tax law applicable to certain foreign entities, Rate											1.80%
Non-deductible compensation, Rate									0.70%	0.40%	0.40%
Other, net, Rate										(0.10%)	2.40%
Effective tax rate									22.80%	43.00%	39.30%

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Income Taxes - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Tax [Line Items]
Statutory federal income tax rate	21.00%	35.00%	35.00%
Income tax benefit from the remeasurement of U.S.deferred income taxes	$ 5,600,000
Tax Cuts And Jobs Act Of2017 Reduction In Effective Income Tax Rate	2.70%
Non-deductible acquisition-related expenses		$ 349,000	$ 1,296,000
Valuation allowances	$ 40,630,000	45,995,000	$ 30,972,000
Unrecognized tax benefits	6,849,000	4,273,000
Unrecognized tax benefits, interest on income taxes accrued	$ 313,000	$ 287,000
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, 2017 and 2018
Statute of limitations for tax examination, Minimum	3 years
Statute of limitations for tax examination, Maximum	10 years
Earliest Tax Year [Member]
Income Tax [Line Items]
Open tax year	2012
Latest Tax Year [Member]
Income Tax [Line Items]
Open tax year	2017
State and Local Jurisdictions [Member]
Income Tax [Line Items]
Net operating loss carry forward	$ 1,403,000
United States [Member]
Income Tax [Line Items]
Net operating loss carry forward	$ 252,000
Operating loss expiration year	2019
Operating loss expiration year	2037
Foreign [Member]
Income Tax [Line Items]
Net operating loss carry forward	$ 84,266,000
Operating loss carryforward, which will expire	$ 5,329,000
Operating loss expiration year	2019
Operating loss expiration year	2025

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Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Detail) - USD ($)	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Deferred tax assets:
Net operating losses	$ 23,926,000	$ 25,418,000
Foreign tax credits	16,800,000	21,346,000
Accruals	4,242,000	5,921,000
Stock-based compensation	3,173,000	3,023,000
Property and equipment	2,008,000	1,111,000
Accounts receivable	1,980,000	2,124,000
Goodwill and other intangibles	1,296,000	4,717,000
Deferred revenue	1,016,000	600,000
Inventories	133,000	1,930,000
Other	2,487,000	335,000
Gross deferred tax assets	57,061,000	66,525,000
Valuation allowances	(40,630,000)	(45,995,000)	$ (30,972,000)
Total deferred tax assets	16,431,000	20,530,000
Deferred tax liabilities:
Inventories	(4,885,000)
Accrued withholding tax	(1,303,000)	(1,452,000)
Goodwill and other intangibles	(1,202,000)	(1,587,000)
Other	(1,757,000)	(1,144,000)
Total deferred tax liabilities	(9,147,000)	(4,183,000)
Net deferred tax assets	$ 7,284,000	$ 16,347,000

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Income Taxes - Net Non-Current Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Net non-current deferred tax assets	$ 7,967	$ 17,064
Net non-current deferred tax liabilities	(683)	(717)
Net deferred tax assets	$ 7,284	$ 16,347

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Income Taxes - Change in Valuation Allowance (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Tax Disclosure [Abstract]
Valuation allowances at beginning of year	$ 45,995,000	$ 30,972,000
Increase in income tax expense	60,000	2,472,000	$ 3,742,000
U.S. federal tax reform	(1,589,000)	11,623,000
Foreign currency translation adjustments	(1,180,000)	2,865,000
Other	(2,656,000)	(1,937,000)
Valuation allowances at end of year	$ 40,630,000	$ 45,995,000	$ 30,972,000

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Income Taxes - Reconciliation of Unrecognized Tax Benefits (Detail) $ in Thousands	12 Months Ended
	Dec. 31, 2018 USD ($)
Income Tax Disclosure [Abstract]
Beginning Balance	$ 3,986
Additions for tax positions in prior periods	1,613
Additions for tax positions in current period	2,014
Subtractions due to foreign currency translation	(8)
Subtractions due to audit settlements and statute expirations	(1,069)
Ending Balance	$ 6,536

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Market Risk Management - Additional Information (Detail) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Line Of Credit Facility [Line Items]
Debt outstanding		$ 117,500,000
Senior Revolving Credit Facility [Member]
Line Of Credit Facility [Line Items]
Debt outstanding	$ 0
Interest rate	3.66%
Term Loan A [Member]
Line Of Credit Facility [Line Items]
Debt outstanding	$ 0
ABS Facility [Member]
Line Of Credit Facility [Line Items]
Debt outstanding	$ 194,000,000
Interest rate	3.46%

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Benefit Plans - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
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	$ 15,216,000	$ 14,083,000	$ 7,684,000

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Share Repurchase Programs - Additional Information (Detail) - USD ($)	Feb. 28, 2018	Dec. 31, 2017	Feb. 29, 2016
Equity [Abstract]
Common stock repurchase program, authorized amount	$ 50,000,000	$ 0	$ 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, 2018	Dec. 31, 2016	Dec. 31, 2018
Equity [Abstract]
Repurchase program, total number of shares purchased	641	1,891	2,532
Repurchase program, average price paid per share	$ 34.42	$ 26.43
Repurchase program, approximate dollar value of shares purchased	$ 22,069	$ 50,000	$ 72,069

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Commitments and Contingencies - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2018 USD ($)
Commitments And Contingencies Disclosure [Abstract]
Other commitment, Performance bonds outstanding	$ 3,725,000
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, 2018	Dec. 31, 2017	Dec. 31, 2016
Quarterly Financial Information Disclosure [Abstract]
Allowance for doubtful accounts receivable, Beginning Balance	$ 10,158	$ 9,138	$ 11,872
Allowance for doubtful accounts receivable, Additions	4,776	5,245	2,452
Allowance for doubtful accounts receivable, Deductions	(4,472)	(4,225)	(5,186)
Allowance for doubtful accounts receivable, Ending Balance	$ 10,462	$ 10,158	$ 9,138

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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, 2018	Dec. 31, 2017	Dec. 31, 2016
Supplemental disclosures of cash flow information:
Cash paid during the year for interest	$ 10,155	$ 10,976	$ 3,782
Cash paid during the year for income taxes, net of refunds	$ 31,218	$ 55,470	$ 39,051

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Cash Flows - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Supplemental Cash Flow Elements [Abstract]
Capital expenditures in accounts payable, purchased at period end but not yet paid	$ 1,170,000	$ 159,000	$ 791,000

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Segment and Geographic Information - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2018 Segment
Segment Reporting [Abstract]
Number of operating segments	3
Description of major customers net sales	None of our clients exceeded ten percent of consolidated net sales in 2018, 2017 or 2016.

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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, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenue from External Customer [Line Items]
Revenues from external customers	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									5,362,981	5,181,734	3,971,828
EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									1,530,241	1,355,416	1,338,560
APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									186,914	166,473	175,127
Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									4,293,351
Hardware Net Sales [Member] | North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									3,610,356	3,352,355	2,454,889
Hardware Net Sales [Member] | EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									653,499	536,500	481,505
Hardware Net Sales [Member] | APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									29,496	27,907	18,916
Software Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									1,956,587
Software Net Sales [Member] | North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									1,112,715	1,310,118	1,146,808
Software Net Sales [Member] | EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									736,509	710,452	762,427
Software Net Sales [Member] | APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									107,363	101,412	132,718
Services Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									830,198
Services Net Sales [Member] | North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									639,910	519,261	370,131
Services Net Sales [Member] | EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									140,233	108,464	94,628
Services Net Sales [Member] | APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers									$ 50,055	$ 37,154	$ 23,493

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Segment and Geographic Information - Financial Information about Reportable Operating Segments (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Total net sales	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Total costs of goods sold	1,494,882	1,512,812	1,576,493	1,502,231	1,551,192	1,531,892	1,432,653	1,269,316	6,086,418	5,785,053	4,742,413
Gross profit	254,164	234,914	264,377	240,263	232,883	226,081	251,379	208,227	993,718	918,570	743,102
Operating expenses:
Selling and administrative expenses	194,790	184,095	189,464	188,180	184,554	180,390	180,752	177,632	756,529	723,328	585,243
Severance and restructuring expenses	715	683	382	1,644	2,791	494	1,022	4,695	3,424	9,002	4,580
Loss on sale of foreign entity						3,646				3,646
Acquisition-related expenses		188	94			106	276	2,947	282	3,329	4,447
Earnings from operations	$ 58,659	$ 49,948	$ 74,437	$ 50,439	$ 45,538	$ 41,445	$ 69,329	$ 22,953	233,483	179,265	148,832
Products [Member]
Segment Reporting Information [Line Items]
Total net sales									6,249,938	6,038,744	4,997,263
Total costs of goods sold									5,711,400	5,512,402	4,571,462
Services [Member]
Segment Reporting Information [Line Items]
Total net sales									830,198	664,879	488,252
Total costs of goods sold									375,018	272,651	170,951
North America Segment [Member]
Segment Reporting Information [Line Items]
Total net sales									5,362,981	5,181,734	3,971,828
Total costs of goods sold									4,630,286	4,490,057	3,446,347
Gross profit									732,695	691,677	525,481
Operating expenses:
Selling and administrative expenses									545,091	530,792	401,316
Severance and restructuring expenses									1,617	4,010	2,966
Acquisition-related expenses									282	3,223	4,278
Earnings from operations									185,705	153,652	116,921
North America Segment [Member] | Products [Member]
Segment Reporting Information [Line Items]
Total net sales									4,723,071	4,662,473	3,601,697
Total costs of goods sold									4,313,070	4,253,587	3,301,148
North America Segment [Member] | Services [Member]
Segment Reporting Information [Line Items]
Total net sales									639,910	519,261	370,131
Total costs of goods sold									317,216	236,470	145,199
EMEA Segment [Member]
Segment Reporting Information [Line Items]
Total net sales									1,530,241	1,355,416	1,338,560
Total costs of goods sold									1,308,774	1,165,106	1,152,873
Gross profit									221,467	190,310	185,687
Operating expenses:
Selling and administrative expenses									182,470	164,305	160,269
Severance and restructuring expenses									1,677	4,888	1,496
Loss on sale of foreign entity										3,646
Acquisition-related expenses										106
Earnings from operations									37,320	17,365	23,922
EMEA Segment [Member] | Products [Member]
Segment Reporting Information [Line Items]
Total net sales									1,390,008	1,246,952	1,243,932
Total costs of goods sold									1,273,422	1,140,204	1,129,917
EMEA Segment [Member] | Services [Member]
Segment Reporting Information [Line Items]
Total net sales									140,233	108,464	94,628
Total costs of goods sold									35,352	24,902	22,956
APAC Segment [Member]
Segment Reporting Information [Line Items]
Total net sales									186,914	166,473	175,127
Total costs of goods sold									147,358	129,890	143,193
Gross profit									39,556	36,583	31,934
Operating expenses:
Selling and administrative expenses									28,968	28,231	23,658
Severance and restructuring expenses									130	104	118
Acquisition-related expenses											169
Earnings from operations									10,458	8,248	7,989
APAC Segment [Member] | Products [Member]
Segment Reporting Information [Line Items]
Total net sales									136,859	129,319	151,634
Total costs of goods sold									124,908	118,611	140,397
APAC Segment [Member] | Services [Member]
Segment Reporting Information [Line Items]
Total net sales									50,055	37,154	23,493
Total costs of goods sold									$ 22,450	$ 11,279	$ 2,796

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Segment and Geographic Information - Summary of Total Assets by Reportable Operating Segment (Detail) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ 2,775,947	$ 2,685,651
Operating Segments [Member] | North America Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	2,660,886	2,337,573
Operating Segments [Member] | EMEA Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	611,338	530,242
Operating Segments [Member] | APAC Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	98,959	101,169
Intersegment Eliminations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ (595,236)	$ (283,333)

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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, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net sales	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Total long-lived assets	72,954				75,252				72,954	75,252
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net sales									5,100,456	4,933,805	3,776,352
Total long-lived assets	52,346				50,462				52,346	50,462
United Kingdom [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net sales									843,145	684,632	671,999
Total long-lived assets	12,434				14,783				12,434	14,783
Other Foreign [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total net sales									1,136,535	1,085,186	$ 1,037,164
Total long-lived assets	$ 8,174				$ 10,007				$ 8,174	$ 10,007

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Segment and Geographic Information - Pre-Tax Depreciation and Amortization by Operating Segment (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	$ 21,721	$ 25,787	$ 27,493
Amortization of intangible assets	15,737	16,812	10,637
Depreciation and amortization, total	37,458	42,599	38,130
North America Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	17,164	20,241	21,952
Amortization of intangible assets	14,791	15,971	8,139
EMEA Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	4,058	5,025	4,908
Amortization of intangible assets	285	73	1,951
APAC Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	499	521	633
Amortization of intangible assets	$ 661	$ 768	$ 547

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Acquisitions - Additional Information (Detail) - USD ($)					3 Months Ended			12 Months Ended
	Aug. 01, 2018	Sep. 26, 2017	Jan. 06, 2017	Sep. 01, 2016	Dec. 31, 2017	Jun. 30, 2017	Dec. 31, 2016	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Acquisitions, net of cash and cash equivalents acquired								$ 74,938,000	$ 186,932,000	$ 10,297,000
Goodwill					$ 131,431,000			166,841,000	131,431,000
Amortization expense								15,737,000	16,812,000	10,637,000
Reduction in goodwill balance due to adjustment in purchase price allocation						$ 945,000			0
North America Segment [Member]
Business Acquisition [Line Items]
Goodwill					119,828,000			156,268,000	119,828,000
Amortization expense								$ 14,791,000	$ 15,971,000	8,139,000
Business acquisition, effective date of acquisition								Aug. 01, 2018	Jan. 06, 2017
EMEA Segment [Member]
Business Acquisition [Line Items]
Goodwill					4,041,000			$ 3,749,000	$ 4,041,000
Amortization expense								285,000	$ 73,000	1,951,000
Business acquisition, effective date of acquisition									Sep. 26, 2017
APAC Segment [Member]
Business Acquisition [Line Items]
Goodwill					7,562,000			6,824,000	$ 7,562,000
Amortization expense								$ 661,000	768,000	$ 547,000
Business acquisition, effective date of acquisition										Sep. 01, 2016
Cardinal Solutions Group, Inc [Member]
Business Acquisition [Line Items]
Acquisition, percentage of issued and outstanding shares acquired	100.00%
Acquisitions, net of cash and cash equivalents acquired	$ 78,800,000
Acquisition, working capital and estimated tax adjustments	$ 3,800,000
Business acquisition, effective date of acquisition	Aug. 01, 2018
Cardinal Solutions Group, Inc [Member] | North America Segment [Member]
Business Acquisition [Line Items]
Net assets acquired	$ 42,360,000
Identifiable intangible assets	27,540,000
Goodwill	$ 36,440,000
Cardinal Solutions Group, Inc [Member] | North America Segment [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets	10 years
Caase Group, B.V. [Member]
Business Acquisition [Line Items]
Acquisitions, net of cash and cash equivalents acquired		$ 6,038,000
Business acquisition, effective date of acquisition		Sep. 26, 2017
Caase Group, B.V. [Member] | EMEA Segment [Member]
Business Acquisition [Line Items]
Net assets acquired		$ 2,107,000
Goodwill					4,041,000				4,041,000
Cash acquired		68,000
Acquired identifiable intangible assets		2,039,000
Decrease in fair value of acquired identifiable intangible assets					$ 193,000
Tax deductible goodwill		0
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] | EMEA Segment [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets		8 years
Caase Group, B.V. [Member] | EMEA Segment [Member] | Trade Name [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets		8 years
Caase Group, B.V. [Member] | EMEA Segment [Member] | Non-compete Agreements [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets		8 years
Datalink [Member]
Business Acquisition [Line Items]
Acquisitions, net of cash and cash equivalents acquired			$ 257,456,000
Identifiable intangible assets			94,500,000
Goodwill			64,140,000
Cash acquired			76,597,000
Tax deductible goodwill			0
Estimated fair value of deferred revenue			65,500,000
Estimated fair value of deferred costs			$ 48,029,000
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
Business acquisition, effective date of acquisition			Jan. 06, 2017
Datalink [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Identifiable intangible assets			$ 92,200,000
Datalink [Member] | Trade Name [Member]
Business Acquisition [Line Items]
Identifiable intangible assets			2,200,000
Datalink [Member] | Non-compete Agreements [Member]
Business Acquisition [Line Items]
Identifiable intangible assets			100,000
Datalink [Member] | North America Segment [Member]
Business Acquisition [Line Items]
Goodwill			$ 64,140,000
Ignia Pty Ltd [Member]
Business Acquisition [Line Items]
Acquisitions, net of cash and cash equivalents acquired				$ 10,804,000
Business acquisition, effective date of acquisition				Sep. 01, 2016
Ignia Pty Ltd [Member] | APAC Segment [Member]
Business Acquisition [Line Items]
Acquisitions, net of cash and cash equivalents acquired				$ 10,804,000
Net assets acquired				5,324,000
Goodwill							$ 6,957,000			$ 6,957,000
Cash acquired				1,463,000
Acquired identifiable intangible assets				4,716,000
Decrease in fair value of acquired identifiable intangible assets							$ 218,000
Tax deductible goodwill						$ 0
Business acquisition, effective date of acquisition								Sep. 01, 2016
Ignia Pty Ltd [Member] | APAC Segment [Member] | Scenario, Previously Reported [Member]
Business Acquisition [Line Items]
Goodwill				$ 7,248,000
Ignia Pty Ltd [Member] | APAC Segment [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets				8 years
Ignia Pty Ltd [Member] | APAC Segment [Member] | Restrictive Covenant Agreements [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets				27 months

XML

Acquisitions - Summary of Purchase Price and Estimated Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($)		12 Months Ended
	Jan. 06, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Total purchase price		$ 74,938,000	$ 186,932,000	$ 10,297,000
Fair value of net assets acquired:
Excess purchase price over fair value of net assets acquired (“goodwill”)		$ 166,841,000	$ 131,431,000
Datalink [Member]
Business Acquisition [Line Items]
Total purchase price	$ 257,456,000
Fair value of net assets acquired:
Current assets	238,577,000
Identifiable intangible assets	94,500,000
Property and equipment	5,843,000
Other assets	17,888,000
Current liabilities	(129,071,000)
Long-term liabilities, including deferred taxes	(34,421,000)
Total fair value of net assets acquired	193,316,000
Excess purchase price over fair value of net assets acquired (“goodwill”)	$ 64,140,000

XML

Acquisitions - Estimated Useful Lives of Identifiable Intangibles (Detail) - Datalink [Member]	12 Months Ended
	Dec. 31, 2018
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, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Net sales, As reported	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Net earnings, As reported	$ 47,041	$ 32,154	$ 51,479	$ 33,003	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 163,677	$ 90,683	$ 84,690
Diluted earnings per share, As reported	$ 1.31	$ 0.89	$ 1.44	$ 0.91	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 4.55	$ 2.50	$ 2.32
Datalink [Member]
Business Acquisition [Line Items]
Net sales, As reported										$ 6,703,623	$ 5,485,515
Net sales, Proforma										6,707,533	6,084,484
Net earnings, As reported										90,683	84,690
Net earnings, Proforma										$ 92,276	$ 85,823
Diluted earnings per share, As reported										$ 2.50	$ 2.32
Diluted earnings per share, Proforma										$ 2.55	$ 2.36

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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, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Quarterly Financial Information Disclosure [Abstract]
Revenues from external customers	$ 1,749,046	$ 1,747,726	$ 1,840,870	$ 1,742,494	$ 1,784,075	$ 1,757,973	$ 1,684,032	$ 1,477,543	$ 7,080,136	$ 6,703,623	$ 5,485,515
Costs of goods sold	1,494,882	1,512,812	1,576,493	1,502,231	1,551,192	1,531,892	1,432,653	1,269,316	6,086,418	5,785,053	4,742,413
Gross profit	254,164	234,914	264,377	240,263	232,883	226,081	251,379	208,227	993,718	918,570	743,102
Operating expenses:
Selling and administrative expenses	194,790	184,095	189,464	188,180	184,554	180,390	180,752	177,632	756,529	723,328	585,243
Severance and restructuring expenses	715	683	382	1,644	2,791	494	1,022	4,695	3,424	9,002	4,580
Loss on sale of foreign entity						3,646				3,646
Acquisition-related expenses		188	94			106	276	2,947	282	3,329	4,447
Earnings from operations	58,659	49,948	74,437	50,439	45,538	41,445	69,329	22,953	233,483	179,265	148,832
Non-operating (income) expense:
Interest income	(422)	(330)	(170)	(153)	(346)	(227)	(205)	(431)	(1,075)	(1,209)	(1,066)
Interest expense	5,563	6,132	5,102	6,015	5,360	5,555	4,326	3,933	22,812	19,174	8,628
Net foreign currency exchange (gain) loss	(1,517)	539	(275)	(245)	(117)	341	251	380	(1,498)	855	522
Other expense, net	323	393	324	302	367	339	326	315	1,342	1,347	1,290
Earnings before income taxes	54,712	43,214	69,456	44,520	40,274	35,437	64,631	18,756	211,902	159,098	139,458
Income tax expense	7,671	11,060	17,977	11,517	26,106	13,025	24,376	4,908	48,225	68,415	54,768
Net earnings	$ 47,041	$ 32,154	$ 51,479	$ 33,003	$ 14,168	$ 22,412	$ 40,255	$ 13,848	$ 163,677	$ 90,683	$ 84,690
Net earnings per share:
Basic	$ 1.33	$ 0.91	$ 1.45	$ 0.92	$ 0.40	$ 0.63	$ 1.13	$ 0.39	$ 4.60	$ 2.54	$ 2.35
Diluted	$ 1.31	$ 0.89	$ 1.44	$ 0.91	$ 0.39	$ 0.62	$ 1.11	$ 0.38	$ 4.55	$ 2.50	$ 2.32
Shares used in per share calculations:
Basic	35,480	35,468	35,483	35,913	35,809	35,787	35,765	35,602	35,586	35,741	36,102
Diluted	35,999	35,957	35,815	36,263	36,272	36,203	36,169	36,185	36,009	36,207	36,438

XML

Selected Quarterly Financial Information - Consolidated Quarterly Financial Information (Parenthetical) (Detail) - USD ($)	3 Months Ended								6 Months Ended	12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales	$ 1,749,046,000	$ 1,747,726,000	$ 1,840,870,000	$ 1,742,494,000	$ 1,784,075,000	$ 1,757,973,000	$ 1,684,032,000	$ 1,477,543,000		$ 7,080,136,000	$ 6,703,623,000	$ 5,485,515,000
Effect of error revision on cost of goods sold	$ 1,494,882,000	$ 1,512,812,000	$ 1,576,493,000	$ 1,502,231,000	$ 1,551,192,000	$ 1,531,892,000	$ 1,432,653,000	$ 1,269,316,000		$ 6,086,418,000	$ 5,785,053,000	$ 4,742,413,000
Effect of error revision on diluted earnings per share	$ 1.31	$ 0.89	$ 1.44	$ 0.91	$ 0.39	$ 0.62	$ 1.11	$ 0.38		$ 4.55	$ 2.50	$ 2.32
Software Revenue Transactions [Member] | Restatement Adjustment [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on gross profit, earnings from operations and net earnings				$ 258,000
Effect of error revision on diluted earnings per share				$ 0.01
Software Revenue Transactions [Member] | Restatement Adjustment [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on gross profit, earnings from operations and net earnings			$ 0						$ 258,000
Effect of error revision on diluted earnings per share			$ 0						$ 0
Products [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales										$ 6,249,938,000	$ 6,038,744,000	$ 4,997,263,000
Effect of error revision on cost of goods sold										5,711,400,000	5,512,402,000	4,571,462,000
Products [Member] | Software Revenue Transactions [Member] | Restatement Adjustment [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales				$ (24,364,000)
Effect of error revision on cost of goods sold				(23,749,000)
Products [Member] | Software Revenue Transactions [Member] | Restatement Adjustment [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales			$ (949,000)						$ (25,313,000)
Effect of error revision on cost of goods sold			(532,000)						(24,281,000)
Services [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales										830,198,000	664,879,000	488,252,000
Effect of error revision on cost of goods sold										$ 375,018,000	$ 272,651,000	$ 170,951,000
Services [Member] | Software Revenue Transactions [Member] | Restatement Adjustment [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales				3,953,000
Effect of error revision on cost of goods sold				$ 3,080,000
Services [Member] | Software Revenue Transactions [Member] | Restatement Adjustment [Member]
Error Corrections And Prior Period Adjustments Restatement [Line Items]
Effect of error revision on net sales			4,900,000						8,853,000
Effect of error revision on cost of goods sold			$ 4,483,000						$ 7,563,000