Document and Entity Information
Document and Entity Information - USD ($) shares in Millions, $ in Billions | 12 Months Ended | ||
Dec. 31, 2015 | Jan. 31, 2016 | Jun. 30, 2015 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | MCO | ||
Entity Registrant Name | MOODYS CORP /DE/ | ||
Entity Central Index Key | 1,059,556 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 194.9 | ||
Entity Public Float | $ 21.3 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenue | $ 3,484.5 | $ 3,334.3 | $ 2,972.5 |
Expenses | |||
Operating | 976.3 | 930.3 | 822.4 |
Selling, general and administrative | 921.3 | 869.3 | 822.1 |
Depreciation and amortization | 113.5 | 95.6 | 93.4 |
Total expenses | 2,011.1 | 1,895.2 | 1,737.9 |
Operating income | 1,473.4 | 1,439.1 | 1,234.6 |
Non-operating (expense) income, net | |||
Interest expense, net | (115.1) | (116.8) | (91.8) |
Other non-operating income, net | 21.3 | 35.9 | 26.5 |
ICRA Gain | 102.8 | ||
Non-operating income (expense), net | (93.8) | 21.9 | (65.3) |
Income before provision for income taxes | 1,379.6 | 1,461 | 1,169.3 |
Provision for income taxes | 430 | 455 | 353.4 |
Net income | 949.6 | 1,006 | 815.9 |
Less: Net income attributable to noncontrolling interests | 8.3 | 17.3 | 11.4 |
Net income attributable to Moody's | $ 941.3 | $ 988.7 | $ 804.5 |
Earnings per share | |||
Basic | $ 4.7 | $ 4.69 | $ 3.67 |
Diluted | $ 4.63 | $ 4.61 | $ 3.6 |
Weighted average shares outstanding | |||
Basic | 200.1 | 210.7 | 219.4 |
Diluted | 203.4 | 214.7 | 223.5 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net income | $ 949.6 | $ 1,006 | $ 815.9 |
Foreign currency adjustments: | |||
Foreign currency translation adjustment - Pre Tax | (110.5) | (123) | (9.5) |
Foreign currency translation adjustment - Tax | (14.7) | (10.7) | (2) |
Foreign currency translation adjustments - Net of Tax | (125.2) | (133.7) | (11.5) |
Foreign currency translation adjustments - reclassification of losses included in net income - Pre Tax | $ (0.1) | 4.4 | 1.4 |
Foreign currency translation adjustments - reclassification of losses included in net income - Tax | |||
Foreign currency translation adjustments - reclassification of losses included in net income - Net of Tax | $ (0.1) | 4.4 | 1.4 |
Cash flow hedges: | |||
Net realized loss on cash flow hedges - Pre Tax | $ (1.1) | ||
Net realized loss on cash flow hedges - Tax | |||
Net realized loss on cash flow hedges - Net of Tax | $ (1.1) | ||
Reclassification of losses included in net income - Pre Tax | 1.2 | ||
Reclassification of losses included in net income - Tax | (0.5) | ||
Reclassification of losses included in net income - Net of Tax | 0.7 | ||
Available for sale securities: | |||
Net unrealized gains on available for sale securities - Pre Tax | $ 3.3 | 1 | |
Net unrealized gains on available for sale securities - Tax | |||
Net unrealized gains on available for sale securities - Net of Tax | $ 3.3 | 1 | |
Reclassification of gains included in net income - Pre Tax | $ (0.9) | (0.1) | |
Reclassification of gains included in net income - Tax | |||
Reclassification of gains included in net income - Net of Tax | $ (0.9) | (0.1) | |
Pension and Other Retirement Benefits: | |||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | 13.5 | 7.3 | 11.9 |
Amortization of actuarial losses and prior service costs included in net income - Tax | (5.2) | (2.8) | (4.9) |
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | 8.3 | 4.5 | 7 |
Net actuarial gain (loss) arising during period | 18.5 | (93.8) | 50.9 |
Net actuarial losses and prior service costs - Tax | (7.1) | 37.1 | (21) |
Net actuarial losses and prior service costs - Net of Tax | 11.4 | (56.7) | 29.9 |
Total other comprehensive income (loss) - Pre Tax | (77.3) | (204.2) | 55.9 |
Total other comprehensive income (loss) - Tax | (27) | 23.6 | (28.4) |
Total other comprehensive income (loss) - Net of Tax | (104.3) | (180.6) | 27.5 |
Comprehensive income (loss) | 845.3 | 825.4 | 843.4 |
Less: comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interest | 8.3 | 17.3 | 11.4 |
Comprehensive income attributable to Moody's | $ 837 | $ 808.1 | $ 832 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 1,757.4 | $ 1,219.5 |
Short-term investments | 474.8 | 458.1 |
Accounts receivable, net of allowances of $27.5 in 2015 and $29.4 in 2014 | 802 | 792.4 |
Deferred tax assets, net | 29.3 | 43.9 |
Other current assets | 179.6 | 172.5 |
Total current assets | 3,243.1 | 2,686.4 |
Property and equipment, net | 306.4 | 302.3 |
Goodwill | 976.3 | 1,021.1 |
Intangible assets, net | 299.1 | 345.5 |
Deferred tax assets, net | 137.7 | 167.8 |
Other assets | 160.8 | 145.9 |
Total assets | 5,123.4 | 4,669 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 566.6 | 557.6 |
Deferred tax liabilities net | 16.7 | 17.5 |
Deferred revenue | 635.2 | 624.6 |
Total current liabilities | 1,218.5 | 1,199.7 |
Non-current portion of deferred revenue | 132.5 | 132.2 |
Long-term debt | 3,401 | 2,547.3 |
Deferred tax liabilities, net | 83.8 | 95.7 |
Unrecognized tax benefits | 203.4 | 220.3 |
Other liabilities | 417.2 | 430.9 |
Total liabilities | $ 5,456.4 | $ 4,626.1 |
Contingencies (Note 18) | ||
Shareholders' (deficit) equity: | ||
Preferred stock, par value $.01 per share; 10,000,000 shares authorized; no shares issued and outstanding | ||
Capital surplus | $ 451.3 | $ 383.9 |
Retained earnings | 6,709 | 6,044.3 |
Treasury stock, at cost; 146,826,744 and 138,539,128 shares of common stock at December 31, 2015 and December 31, 2014, respectively | (7,389.2) | (6,384.2) |
Accumulated other comprehensive loss | (339.5) | (235.2) |
Total Moody's shareholders' (deficit) | (565) | (187.8) |
Noncontrolling interests | 232 | 230.7 |
Total shareholders' (deficit) equity | (333) | 42.9 |
Total liabilities, noncontrolling interest and shareholders' (deficit) equity | $ 5,123.4 | $ 4,669 |
Series common stock | ||
Shareholders' (deficit) equity: | ||
Common stock | ||
Common Stock | ||
Shareholders' (deficit) equity: | ||
Common stock | $ 3.4 | $ 3.4 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts receivable, allowances | $ (27.5) | $ (29.4) |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, shares authorized | 1,000,000,000 | |
Treasury stock, shares | 146,826,744 | 138,539,128 |
Series common stock | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common Stock | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 342,902,272 | 342,902,272 |
Common stock, shares outstanding | 10,000,000 | 10,000,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities | |||
Net income | $ 949.6 | $ 1,006 | $ 815.9 |
Reconciliation of net income to net cash provided by operating activities: | |||
Depreciation and amortization | 113.5 | 95.6 | 93.4 |
Stock-based compensation expense | 87.2 | 80.4 | 67.1 |
Deferred income taxes | 18.1 | 29.9 | (27.2) |
Excess tax benefits from settlement of stock-based compensation awards | (44.5) | (58.7) | (38.8) |
ICRA Gain | (102.8) | ||
Legacy Tax Matters | (6.4) | (6.4) | (19.2) |
Changes in assets and liabilities: | |||
Accounts receivable | (25.4) | (98.3) | (67) |
Other current assets | (28.9) | (41) | (21.7) |
Other assets | (13.1) | (1.7) | (0.7) |
Accounts payable and accrued liabilities | 51.4 | 59.2 | (2.9) |
Deferred revenue | 31.6 | 38.4 | 66.1 |
Unrecognized tax benefits | (10.9) | 30.6 | 30.9 |
Other liabilities | 31.4 | (12.6) | 30.9 |
Net cash provided by operating activities | 1,153.6 | 1,018.6 | 926.8 |
Cash flows from investing activities | |||
Capital additions | (89) | (74.6) | (42.3) |
Purchases of investments | (688.2) | (406.3) | (225.9) |
Sales and maturities of investments | 653.1 | 134 | 57 |
Cash paid for acquisitions and investment in affiliates, net of cash acquired | (7.6) | (239.7) | (50.7) |
Payments for settlements of net investment hedges | 39.7 | 21.7 | |
Net cash used in investing activities | (92) | (564.9) | (261.9) |
Cash flows from financing activities | |||
Issuance of notes | 852.8 | 747.7 | 497.2 |
Repayment of notes | (300) | (63.8) | |
Proceeds from stock-based compensation plans | 89.2 | 149.4 | 166.9 |
Repurchase of shares related to stock-based compensation | (59.5) | (51.4) | (30.9) |
Excess tax benefits from settlement of stock-based compensation awards | 44.5 | 58.7 | 38.8 |
Treasury shares | (1,098.1) | (1,220.5) | (893.1) |
Dividends | (272.1) | (236) | (197.3) |
Dividends to noncontrolling interests | (6.8) | (11.8) | (12.2) |
Payment to noncontrolling interest | (183.8) | ||
Contingent consideration | (1.5) | (10.3) | (0.3) |
Debt issuance costs and related fees | (9.5) | (6.5) | (4.1) |
Net cash used in financing activities | (461) | (1,064.5) | (498.8) |
Effect of exchange rate changes on cash and cash equivalents | (62.7) | (89.2) | (2) |
Increase (decrease) in cash and cash equivalents | 537.9 | (700) | 164.1 |
Cash and cash equivalents, beginning of period | 1,219.5 | 1,919.5 | 1,755.4 |
Cash and cash equivalents, end of period | $ 1,757.4 | $ 1,219.5 | $ 1,919.5 |
CONSOLIDATED STATEMENT OF SHARE
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Capital Surplus | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Total Moody's Shareholders' Equity (Deficit) | Non-Controlling Interests |
Beginning Balance (in shares) at Dec. 31, 2012 | 342.9 | (119.7) | ||||||
Beginning Balance at Dec. 31, 2012 | $ 396.6 | $ 3.4 | $ 365.1 | $ 4,713.3 | $ (4,614.5) | $ (82.1) | $ 385.2 | $ 11.4 |
Net income | 810.2 | 804.5 | 804.5 | 5.7 | ||||
Dividends | (221.9) | (215.7) | (215.7) | (6.2) | ||||
Stock-based compensation | 67.2 | 67.2 | 67.2 | |||||
Shares issued for stock-based compensation plans, net | 136 | (51.9) | $ 187.9 | 136 | ||||
Shares issued for stock-based compensation plans, net (in shares) | 5 | |||||||
Net excess tax benefit upon settlement of stock-based compensation awards | 33.3 | 33.3 | 33.3 | |||||
Adjustment to redemption value of redeemable noncontrolling interest | (7.9) | (7.9) | (7.9) | |||||
Treasury shares repurchased, shares | (14.2) | |||||||
Treasury shares repurchased | (893.1) | $ (893.1) | (893.1) | |||||
Currency translation adjustment | (10.1) | (10.1) | (10.1) | |||||
Net actuarial losses and prior service costs - Net of Tax | 29.9 | 29.9 | 29.9 | |||||
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | 7 | 7 | 7 | |||||
Net unrealized gain on cash flow hedges | 0.7 | 0.7 | 0.7 | |||||
Ending Balance at Dec. 31, 2013 | 347.9 | $ 3.4 | 405.8 | 5,302.1 | $ (5,319.7) | (54.6) | 337 | 10.9 |
Ending Balance (in shares) at Dec. 31, 2013 | 342.9 | (128.9) | ||||||
Net income | 996.6 | 988.7 | 988.7 | 7.9 | ||||
Dividends | (253.4) | (246.5) | (246.5) | (6.9) | ||||
Stock-based compensation | 80.6 | 80.6 | 80.6 | |||||
Shares issued for stock-based compensation plans, net | 98 | (58) | $ 156 | 98 | ||||
Shares issued for stock-based compensation plans, net (in shares) | 4.2 | |||||||
Net excess tax benefit upon settlement of stock-based compensation awards | 54.7 | 54.7 | 54.7 | |||||
Adjustment to redemption value of redeemable noncontrolling interest | (99.2) | (99.2) | (99.2) | |||||
Treasury shares repurchased, shares | (13.8) | |||||||
Treasury shares repurchased | (1,220.5) | $ (1,220.5) | (1,220.5) | |||||
Currency translation adjustment | (129.3) | (129.3) | (129.3) | |||||
Net actuarial losses and prior service costs - Net of Tax | (56.7) | (56.7) | (56.7) | |||||
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | 4.5 | 4.5 | 4.5 | |||||
Unrealized Gains On Available For Sale Securities | 0.9 | 0.9 | 0.9 | |||||
Ending Balance at Dec. 31, 2014 | 42.9 | $ 3.4 | 383.9 | 6,044.3 | $ (6,384.2) | (235.2) | (187.8) | 230.7 |
Ending Balance (in shares) at Dec. 31, 2014 | 342.9 | (138.5) | ||||||
ICRA noncontrolling interest | 218.8 | 218.8 | ||||||
Net income | 949.6 | 941.3 | 941.3 | 8.3 | ||||
Dividends | (283.6) | (276.6) | (276.6) | (7) | ||||
Stock-based compensation | 87.5 | 87.5 | 87.5 | |||||
Shares issued for stock-based compensation plans, net | 29.6 | (63.5) | $ 93.1 | 29.6 | ||||
Shares issued for stock-based compensation plans, net (in shares) | 2.6 | |||||||
Net excess tax benefit upon settlement of stock-based compensation awards | 43.4 | 43.4 | 43.4 | |||||
Treasury shares repurchased, shares | (10.9) | |||||||
Treasury shares repurchased | (1,098.1) | $ (1,098.1) | (1,098.1) | |||||
Currency translation adjustment | (125.3) | (125.3) | (125.3) | |||||
Net actuarial losses and prior service costs - Net of Tax | 11.4 | 11.4 | 11.4 | |||||
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | 8.3 | 8.3 | 8.3 | |||||
Unrealized Gains On Available For Sale Securities | 2.4 | 2.4 | 2.4 | |||||
Net unrealized gain on cash flow hedges | (1.1) | (1.1) | (1.1) | |||||
Ending Balance at Dec. 31, 2015 | $ (333) | $ 3.4 | $ 451.3 | $ 6,709 | $ (7,389.2) | $ (235.2) | $ (565) | $ 230.7 |
Ending Balance (in shares) at Dec. 31, 2015 | 342.9 | (146.8) |
CONSOLIDATED STATEMENT OF SHAR8
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT) (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Currency translation adjustment, tax | $ 2.8 | $ 0.6 | $ 0.2 |
Net actuarial losses and prior service costs - Tax | 7.1 | (37.1) | 21 |
Amortization of actuarial losses and prior service costs included in net income - Tax | 5.2 | 2.8 | 4.9 |
Net unrealized gain on cash flow hedges, tax | $ 10.7 | $ 12.9 | $ 3.1 |
GLOSSARY OF TERMS AND ABBREVIAT
GLOSSARY OF TERMS AND ABBREVIATIONS | 12 Months Ended |
Dec. 31, 2015 | |
GLOSSARY OF TERMS AND ABBREVIATIONS | The following terms, abbreviations and acronyms are used to identify frequently used terms in this report: TERM DEFINITION Adjusted Operating Income Operating income excluding restructuring, depreciation and amortization and a goodwill impairment charge Adjusted Operating Margin Adjusted Operating Income divided by revenue Amba Amba Investment Services; a provider of investment research and quantitative analytics for global financial institutions; a subsidiary of the Company acquired 100% of Amba in December 2013. Americas Represents countries within North and South America, excluding the U.S. AOCI Accumulated other comprehensive income (loss); a separate component of shareholders’ equity (deficit); includes accumulated gains & losses on cash flow and net investment hedges, certain gains and losses relating to pension and other retirement benefits obligations and foreign currency translation adjustments. ASC The FASB Accounting Standards Codification; the sole source of authoritative GAAP as of July 1, 2009 except for rules and interpretive releases of the SEC, which are also sources of authoritative GAAP for SEC registrants Asia-Pacific Represents countries in Asia also including but not limited to: Australia and its proximate islands, China, India, Indonesia, Japan, Korea, Malaysia, Singapore and Thailand ASU The FASB Accounting Standards Updates to the ASC. It also provides background information for accounting guidance and the bases for conclusions on the changes in the ASC. ASUs are not considered authoritative until codified into the ASC Basel II Capital adequacy framework published in June 2004 by the Basel Committee on Banking Supervision Basel III A new global regulatory standard on bank capital adequacy and liquidity agreed by the members of the Basel Committee on Banking Supervision. Basel III was developed in a response to the deficiencies in financial regulation revealed by the global financial crisis. Basel III strengthens bank capital requirements and introduces new regulatory requirements on bank liquidity and bank leverage. Board The board of directors of the Company BPS Basis points Canary Wharf Lease Operating lease agreement entered into on February 6, 2008 for office space in London, England, occupied by the Company in the second half of 2009 CFG Corporate finance group; an LOB of MIS CLO Collateralized loan obligation CMBS Commercial mortgage-backed securities; part of CREF Commission European Commission Common Stock The Company’s common stock Company Moody’s Corporation and its subsidiaries; MCO; Moody’s Copal Copal Partners; an acquisition completed in November 2011; part of the MA segment; leading provider of outsourced research and analytical services to institutional investors Copal Amba Operating segment created in January 2014 that consists of all operations from Copal as well as the operations of Amba. The Copal Amba operating segment provides outsourced research and analytical services to the global financial and corporate sectors Council Council of the European Union COSO Committee of Sponsoring Organizations of the Treadway Commission CP Commercial paper CRAs Credit rating agencies CRA1 Regulation (EC) No 1060/2009 of the European Parliament and of the Council, establishing an oversight regime for the CRA industry in the EU CRA2 Regulation (EC) No 513/2011 of the European Parliament and of the Council, which transferred direct supervisory responsibility of the registered CRA industry in the EU to ESMA CRA3 Regulation (EC) No 462/2013 of the European Parliament and of the Council, which updated the regulatory regimes imposing additional procedural requirements on CRAs CREF Commercial real estate finance which includes REITs, commercial real estate collateralized debt obligations and CMBS; part of SFG CSI CSI Global Education, Inc.; an acquisition completed in November 2010; part of the MA segment; a provider of financial learning, credentials, and certification in Canada D&A Depreciation & amortization D&B Business Old D&B’s Dun & Bradstreet operating company DBPPs Defined benefit pension plans DCF Discounted cash flow; a fair value calculation methodology whereby future projected cash flows are discounted back to their present value Debt/EBITDA Ratio of Total Debt to EBITDA Directors’ Plan The 1998 Moody’s Corporation Non-Employee Directors’ Stock Incentive Plan Distribution Date September 30, 2000; the date which Old D&B separated into two publicly traded companies – Moody’s Corporation and New D&B EBITDA Earnings before interest, taxes, depreciation and amortization ECB European Central Bank EMEA Represents countries within Europe, the Middle East and Africa EPS Earnings per share ERS The enterprise risk solutions LOB within MA; offers risk management software products as well as software implementation services and related risk management advisory engagements ESMA European Securities and Market Authority ESP Estimated Selling Price; estimate of selling price, as defined in the ASC, at which the vendor would transact if the deliverable were sold by the vendor regularly on a stand-alone basis ESPP The 1999 Moody’s Corporation Employee Stock Purchase Plan ETR Effective tax rate Equilibrium A leading provider of credit rating and research services in Peru and Panama; acquired by Moody’s in May 2015 EU European Union EUR Euros European Ratings Platform Central credit ratings website administered by ESMA Excess Tax Benefit The difference between the tax benefit realized at exercise of an option or delivery of a restricted share and the tax benefit recorded at the time that the option or restricted share is expensed under GAAP Exchange Act The Securities Exchange Act of 1934, as amended FASB Financial Accounting Standards Board FIG Financial institutions group; an LOB of MIS Fitch Fitch Ratings, a part of the Fitch Group Financial Reform Act Dodd-Frank Wall Street Reform and Consumer Protection Act Free Cash Flow Net cash provided by operating activities less cash paid for capital additions FSTC Financial Services Training and Certifications; a reporting unit within the MA segment that includes on-line and classroom-based training services and CSI FX Foreign exchange GAAP U.S. Generally Accepted Accounting Principles GBP British pounds GDP Gross domestic product ICRA ICRA Limited; a leading provider of credit ratings and research in India. The Company previously held 28.5% equity ownership and in June 2014, increased that ownership stake to just over 50% through the acquisition of additional shares ICRA Acquisition The June 2014 purchase of an additional ownership interest in ICRA resulting in a majority ownership and consolidated of ICRAs financial statements; ICRAs results are consolidated into Moody’s financial statements on a three-month lag and accordingly the Company began including the results of operations for ICRA in its consolidated financial statements beginning in the fourth quarter of 2014 ICRA Gain Gain relating to the step-acquisition of ICRA; U.S. GAAP requires the remeasurement to fair value of the previously held non-controlling shares upon obtaining a controlling interest in a step-acquisition. This remeasurement of the Company’s equity investment in ICRA to fair value resulted in a pre-tax gain of $102.8 million ($78.5 million after tax) in the second quarter of 2014 Intellectual Property The Company’s intellectual property, including but not limited to proprietary information, trademarks, research, software tools and applications, models and methodologies, databases, domain names, and other proprietary materials IRS Internal Revenue Service IT Information technology KIS Korea Investors Service, Inc.; a leading Korean rating agency and consolidated subsidiary of the Company KIS Pricing Korea Investors Service Pricing, Inc.; a Korean provider of financial instruments pricing and consolidated subsidiary of the Company KIS Research Korea Investors Service Research; a Korean provider of financial research and consolidated subsidiary of the Company Korea Republic of South Korea Legacy Tax Matter(s) Exposures to certain potential tax liabilities assumed in connection with the 2000 Distribution Lewtan Lewtan Technologies; a leading provider of analytical tools and data for the global structured finance market; part of the RD&A LOB within MA; an acquisition completed in October 2014 LIBOR London Interbank Offered Rate LOB Line of Business MA Moody’s Analytics – a reportable segment of MCO formed in January 2008 which provides a wide range of products and services that support financial analysis and risk management activities of institutional participants in global financial markets. M&A Mergers and acquisitions Make Whole Amount The prepayment penalty relating to the Series 2007-1 Notes, 2010 Senior Notes, 2012 Senior Notes, 2013 Senior Notes, 2014 Senior Notes (5-year), 2014 Senior Notes (30-year) and the 2015 Senior Notes; a premium based on the excess, if any, of the discounted value of the remaining scheduled payments over the prepaid principal MCO Moody’s Corporation and its subsidiaries; the Company; Moody’s MD&A Management’s Discussion and Analysis of Financial Condition and Results of Operations MIS Moody’s Investors Service – a reportable segment of MCO; consists of five LOBs – SFG, CFG, FIG, PPIF and MIS Other MIS Other Consists of non-ratings revenue from ICRA, KIS Pricing and KIS Research. These businesses are components of MIS; an LOB of MIS Moody’s Corporation and its subsidiaries; MCO; the Company Moody’s Net income attributable to Moody’s Corporation, which excludes net income from consolidated entities belonging to the minority interest holder Net Income New D&B The New D&B Corporation – which comprises the D&B business after September 30, 2000 Non-GAAP A financial measure not in accordance with GAAP; these measures, when read in conjunction with the Company’s reported results, can provide useful supplemental information for investors analyzing period-to-period comparisons of the Company’s performance, facilitate comparisons to competitors’ operating results and to provide greater transparency to investors of supplemental information used by management in its financial and operational decision making. NM Percentage change not meaningful NRSRO Nationally Recognized Statistical Rating Organization OCI Other comprehensive income (loss); includes gains and losses on cash flow and net investment hedges, certain gains and losses relating to pension and other retirement benefit obligations and foreign currency translation adjustments Old D&B The former Dun and Bradstreet Company which distributed New D&B shares on September 30, 2000, and was renamed Moody’s Corporation Other Retirement Plans The U.S. retirement healthcare and U.S. retirement life insurance plans PPIF Public, project and infrastructure finance; an LOB of MIS Profit Participation Plan Defined contribution profit participation plan that covers substantially all U.S. employees of the Company PPP Profit Participation Plan PS Professional Services; an LOB within MA that provides outsourced research and analytical services as well as financial training and certification programs RD&A Research, Data and Analytics; an LOB within MA that produces, sells and distributes research, data and related content. Includes products generated by MIS, such as analyses on major debt issuers, industry studies, and commentary on topical credit events, as well as economic research, data, quantitative risk scores, and other analytical tools that are produced within MA Redeemable Noncontrolling Interest Represents minority shareholders’ interest in entities which are controlled but not wholly-owned by Moody’s and for which Moody’s obligation to redeem the minority shareholders’ interest is represented by a put/call relationship Reform Act Credit Rating Agency Reform Act of 2006 REITs Real estate investment trusts Relationship Revenue Represents MIS recurring monitoring of a rated debt obligation and/or entities that issue such obligations, as well as revenue from programs such as commercial paper, medium-term notes and shelf registrations. For MIS Other represents subscription-based revenue. For MA, represents subscription-based revenue and software maintenance revenue. Retirement Plans Moody’s funded and unfunded pension plans, the healthcare plans and life insurance plans RMBS Residential mortgage-backed securities; part of SFG S&P Standard & Poor’s, a division of McGraw-Hill Financial, Inc. SEC Securities and Exchange Commission Securities Act Securities Act of 1933 Series 2005-1 Notes Principal amount of $300 million, 4.98% senior unsecured notes; notes were paid in 2014 in advance of their contractual maturity date Series 2007-1 Notes Principal amount of $300 million, 6.06% senior unsecured notes due in September 2017 pursuant to the 2007 Agreement SFG Structured finance group; an LOB of MIS SG&A Selling, general and administrative expenses SIV Structured Investment Vehicle Solvency II EU directive 2009/138/EC that codifies the amount of capital that EU insurance companies must hold to reduce insolvency Stock Plans The Old D&B’s 1998 Key Employees’ Stock Incentive Plan and the Restated 2001 Moody’s Corporation Key Employees’ Stock Incentive Plan Total Debt All indebtedness of the Company as reflected on the consolidated balance sheets TPE Third party evidence, as defined in the ASC, used to determine selling price based on a vendor’s or any competitor’s largely interchangeable products or services in standalone sales transactions to similarly situated customers Transaction Revenue For MIS, represents the initial rating of a new debt issuance as well as other one-time fees. For MIS Other, represents revenue from professional services and outsourcing engagements. For MA, represents software license fees and revenue from risk management advisory projects, training and certification services, and outsourced research and analytical engagements U.K. United Kingdom U.S. United States U.S. Shared National Credit Program Interagency program designed to evaluate large and complex syndicated credits. The program is administered by the three federal banking regulatory agencies which include the Federal Reserve System, Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation (FDIC). USD U.S. dollar UTBs Unrecognized tax benefits UTPs Uncertain tax positions VSOE Vendor specific objective evidence; evidence, as defined in the ASC, of selling price limited to either of the following: the price charged for a deliverable when it is sold separately, or for a deliverable not yet being sold separately, the price established by management having the relevant authority WACC Weighted average cost of capital WebEquity WebEquity Solutions LLC; a leading provider of cloud-based loan origination solutions for financial institutions; part of the ERS LOB within MA; an acquisition completed in July 2014 1998 Plan Old D&B’s 1998 Key Employees’ Stock Incentive Plan 2000 Distribution The distribution by Old D&B to its shareholders of all of the outstanding shares of New D&B common stock on September 30, 2000 2000 Distribution Agreement governing certain ongoing relationships between the Company and New D&B after the 2000 Distribution including the sharing of any liabilities for the payment of taxes, penalties and interest resulting from unfavorable IRS determinations on certain tax matters and certain other potential tax liabilities Agreement 2001 Plan The Amended and Restated 2001 Moody’s Corporation Key Employees’ Stock Incentive Plan 2005 Agreement Note purchase agreement dated September 30, 2005 relating to the Series 2005-1 Notes 2007 Agreement Note purchase agreement dated September 7, 2007 relating to the Series 2007-1 Notes 2007 Facility Revolving credit facility of $1 billion entered into on September 28, 2007, expiring in 2012 2010 Indenture Supplemental indenture and related agreements dated August 19, 2010, relating to the 2010 Senior Notes 2010 Senior Notes Principal amount of $500.0 million, 5.50% senior unsecured notes due in September 2020 pursuant to the 2010 Indenture 2012 Facility Revolving credit facility of $1 billion entered into on April 18, 2012, was replaced with the 2015 Facility 2012 Indenture Supplemental indenture and related agreements dated August 18, 2012, relating to the 2012 Senior Notes 2012 Senior Notes Principal amount of $500 million, 4.50% senior unsecured notes due in September 2022 pursuant to the 2012 Indenture 2013 Indenture Supplemental indenture and related agreements dated August 12, 2013, relating to the 2013 Senior Notes 2013 Senior Notes Principal amount of $500 million, 4.875% senior unsecured notes due in February 2024 pursuant to the 2013 Indenture Supplemental indenture and related agreements dated July 16, 2014, relating to the 2014 Senior Notes 2014 Indenture Principal amount of $450 million, 2.75% senior unsecured notes due in July 2019 2014 Senior Notes (5- Year) 2014 Senior Notes (30-Year) Principal amount of $600 million, 5.25% senior unsecured notes due in July 2044 2015 Facility Five-year unsecured revolving credit facility, with capacity to borrow up to $1 billion; replaces the 2012 Facility 2015 Indenture Supplemental indenture and related agreements dated March 9, 2015, relating to the 2015 Senior Notes 2015 Senior Notes Principal amount €500 million, 1.75% senior unsecured notes issued March 9, 2015 and due in March 2027 7WTC The Company’s corporate headquarters located at 7 World Trade Center 7WTC Lease Operating lease agreement entered into on October 20, 2006 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2015 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1 DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Moody’s is a provider of (i) credit ratings, (ii) credit, capital markets and economic research, data and analytical tools, (iii) software solutions and related risk management services, (iv) quantitative credit risk measures, financial services training and certification services and (v) outsourced research and analytical services . Moody’s has two reportable segments: MIS and MA. MIS, the credit rating agency, pub lishes credit ratings on a wide range of debt obligations and the entities that issue such obligations in markets worldwide. Revenue is primarily derived from the originators and issuers of such transactions who use MIS ratings in the distribution of their debt issues to investors. Additionally, MIS earns revenue from certain non-ratings-related operations which consist primarily of the distribution of research and financial instrument pricing services in the Asia-Pacific region and outsourced services . The revenue from these operations is included in the MIS Other LOB and is not material to the results of the MIS segment. The MA segment develops a wide range of products and services that support financial analysis and risk management activities of inst itutional participants in global financial markets . Within its RD&A business, MA distributes research and data developed by MIS as part of its ratings process, including in-depth research on major debt issuers, industry studies and commentary on topical cr edit-related events. The RD&A business also produces economic research as well as data and analytical tools such as quantitative credit risk scores. Within its ERS bu siness , MA provides software solutions as well as related risk management services. The P S business provides outsourced research and analytical services along with financial training and certification programs. Certain reclassifications have been made to prior period amounts to conform to the current presentation. |
Description of Business and B11
Description of Business and Basis of Presentation - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 2 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Consolidation The consolidated financial statements include those of Moody’s Corporation and its majority- and wholly-owned subsidiaries. The effects of all intercompany transactions have been eliminated. Investments in companies for which the Company has significant influence over operating and financial policies but not a controlling interest are accounted for on an equity basis whereby the Company records its proportional share of the investm ent’s net income or loss as part of other non-operating income (expense), net and any dividends received reduce the carrying amount of the investment. The Company applies the guidelines set forth in Topic 810 of the ASC in assessing its interests in varia ble interest entities to decide whether to consolidate that entity. The Company has reviewed the potential variable interest entities and determined that there are no consolidation requirements under Topic 810 of the ASC. The Company consolidates its ICRA subsidiaries on a three month lag. Cash and Cash Equivalents Cash equivalents principally consist of investments in money market mutual funds and money market deposit accounts as well as high-grade commercial paper and certificates of deposit with maturit ies of three months or less when purchased. Short-term Investments Short-term investments are securities with maturities greater than 90 days at the time of purchase that are available for operations in the next 12 months. The Company’s short-term investments primarily consist of certificates of deposit and their cost approximates fair value due to the short-term nature of the instruments. Interest and dividends on these investments are recorded into income when earned. Property and Equipment Pro perty and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives. Expenditures for maintenance and repairs that do not extend the economic useful life of the related assets are charged to expense as incurred. Research and Development Costs All research and development costs are expensed as incurred. These costs primarily reflect the development of credit processing software and quantitative credit risk assessment products sold by the MA segment. Research and development costs were $ 29.1 million , $ 37.9 million, and $ 22.8 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, and are included in operating expense s within the Company’s consolidated statements of operations. These costs generally consist of professional services provided by third parties and compensation costs of employees. Costs for internally developed computer software that will be sold, leased or otherwise marketed are capitalized when technological feasibility has been established. These costs primarily relate to the development or enhancement of products in the ERS business and generally consist of professional services provided by third part ies and compensation costs of employees that develop the software. Judgment is required in determining when technological feasibility of a product is established and the Company believes that technological feasibility for its software products is reached a fter all high-risk development issues have been resolved through coding and testing. Generally, this occurs shortly before the products are released to customers. Accordingly, costs for internally developed computer software that will be sold, leased or ot herwise marketed that were eligible for capitalization under Topic 985 of the ASC as well as the related amortization expense related to such costs were immaterial for the years ended December 31, 2015 , 2014 and 2013 . Compu ter Software Developed or Obtained for Internal Use The Company capitalizes costs related to software developed or obtained for internal use. These assets, included in property and equipment in the consolidated balance sheets, relate to the Company’s accou nting, product delivery and other systems. Such costs generally consist of direct costs for third-party license fees, professional services provided by third parties and employee compensation, in each case incurred either during the application development stage or in connection with upgrades and enhancements that increase functionality. Such costs are depreciated over their estimated useful lives on a straight-line basis. Costs incurred during the preliminary project stage of development as well as mainten ance costs are expensed as incurred. Long-Lived Assets, Including Goodwill and Other Acquired Intangible Assets Moody’s evaluates its goodwill for impairment at the reporting unit level, defined as an operating segment or one level below an operating segme nt, annually as of July 31 or more frequentl y if impairment indicators arise in accordance with ASC Topic 350. The Company evaluates the recoverability of goodwill using a three-step impairment test approach at the reporting unit level. In the first step, the Company assesses various qualitative factors to determine whether the fair value of a reporting unit may be less than its carrying amount. If a determination is made that, based on the qualitative factors, an impairment does not exist, the Company is not required to perform further testing. If the aforementioned qualitative assessment results in the Company concluding that it is more likely than not that the fair value of a reporting unit may be less than its carrying amount, the fair value of the repo rting unit will be determined and compared to its carrying value including goodwill. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is not impaired and the Company is not required to per form further testing. If the fair value of the reporting unit is less than the carrying value, the Company must perform a third step of the impairment test to determine the implied fair value of the reporting unit’s goodwill. The implied fair value of the goodwill is determined based on the difference between the fair value of the reporting unit and the net fair value of the identifiable assets and liabilities of the reporting unit. If the implied fair value of the goodwill is less than its carrying value, the difference is recognized as an impairment charge. For the reporting units where the Company is consistently able to conclude that an impairment does not exist using only a qualitative approach, the Company’s accounting policy is to perform the second s tep of the aforementioned goodwill impairment assessment at least once every three years. Goodwill is assigned to a reporting unit at the date when an acquisition is integrated into one of the established reporting units, and is based on which reporting un it is expected to benefit from the synergies of the acquisition. For purposes of assessing the recoverability of goodwill, the Company has six primary reporting units at December 31, 2015 : two within the Company’s ratings business (one for the ICRA busine ss and one that encompasses all of Moody’s other ratings operations) and four reporting units within MA: RD&A, ERS, Financial Services Training and Certificatio ns and Copal Amba . The RD&A reporting unit encompasses the distribution of investor-oriented res earch and data developed by MIS as part of its ratings process, in-depth research on major debt issuers, industry studies, economic research and commentary on topical events and credit analytic tools. The ERS reporting unit consists of credit risk manageme nt and compliance software that is sold on a license or subscription basis as well as related advisory services for implementation and maintenance. The FSTC reporting unit consists of the portion of the MA business that offers both credit training as well as other professional development training and certification services. The Copal Amba reporting unit consists of outsourced research and analytical services. Amortizable intangible assets are reviewed for recoverability whenever events or changes in circu mstances indicate that the carrying amount may not be recoverable. Rent Expense The Company records rent expense on a straight-line basis over the life of the lease. In cases where there is a free rent period or future fixed rent escalations the Company will record a deferred rent liability. Additionally, the receipt of any lease incentives will be recorded as a deferred rent liability which will be amortized over the lease term as a reduction of rent expense. Stock-Based Compensation The Company records compensation expense for all share-based payment award transactions granted to employees based on the fair value of the equity instrument at the time of grant. This includes shares issued under stock option and restricted stock plans . The Company has also established a pool of additional paid-in capital related to the tax effects of employee share-based compensation, which is available to absorb any recognized tax shortfalls . Derivative Instruments and Hedging Activities Based on the Company’s risk management policy, from time to time the Company may use derivative financial instruments to reduce exposure to changes in foreign exchange rates and interest rates. The Company does not enter into derivative financial instruments for speculative purposes. All derivative financial instruments are recorded on the balance sheet at their respective fair values. The changes in the value of derivatives that qualify as fair value hedges are recorded with a corresponding adjustment to the carrying value of the item being hedged . Changes in the derivative’s fair value that qualify as cash flow hedges are recorded to other comprehensive income or loss, to the extent the hedge is effective, and such amounts are reclassified from accumulated other comprehensive income or loss to earnings in the same period or periods during which the hedged transaction affects income. Changes in the deriva tive’s fair value that qualify as net investment hedges are recorded to other comprehensive income or loss, to the extent the hedge is effective. Any changes in the fair value of derivatives that the Company does not designate as hedging instruments under Topic 815 of the ASC are recorded in the consolidated statements of operations in the period in which they occur. Revenue Recognition Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or the services have been provided and accepted by the customer when applicable, fees are determinable and the collection of resulting receivables is considered probable. Pursuant to ASC Topic 605 , when a sales arrangement contains multiple deliverables, the Company allocates reve nue to each deliverable based on its relative selling price which is determined based on its vendor spec ific objective evidence if availab le, third party evidence if VSOE is not available, or estimated selling price if neither VSOE nor TPE is available. The Company’s products and services will generally qualify as separate units of accounting under ASC Topic 605 . The Company evaluates each deliverable in an arrangement to determine whether it represents a separate unit of accounting. A deliverable consti tutes a separate unit of accounting when it has stand-alone value to the customers and if the arrangement includes a customer refund or return right relative to the delivered item and the delivery and performance of the undelivered item is considered proba ble and substantially in the Company’s control. In instances where the aforementioned criteria are not met, the deliverable is combined with the undelivered items and revenue recognition is determined as one single unit. The Company determines whether its selling price in a multi-element transaction meets the VSOE criteria by using the price charged for a deliverable when sold separately or, if the deliverable is not yet being sold separately, the price established by management having the relevant authorit y to establish such a price . In instances where the Company is not able to establish VSOE for all deliverables in a multiple element arrangement, which may be due to the Company infrequently selling each element separately, not selling products within a re asonably narrow price range, or only having a limited sales history, the Company attempts to establish TPE for deliverables. The Company determines whether TPE exists by evaluating largely similar and interchangeable competitor products or services in stan dalone sales to similarly situated customers. However, due to the difficulty in obtaining third party pricing, possible differences in its market strategy from that of its peers and the potential that products and services offered by the Company may contai n a significant level of differentiation and/or customization such that the comparable pricing of products with similar functionality cannot be obtained, the Company generally is unable to reliably determine TPE. Based on the selling price hierarchy establ ished by ASC Topic 605 , when the Company is unable to establish selling price using VSOE or TPE, the Company will establish an ESP. ESP is the price at which the Company would transact a sale if the product or service were sold on a stand-alone basis. The Company establishes its best estimate of ESP considering internal factors relevant to is pricing practices such as costs and margin objectives, standalone sales prices of similar products, percentage of the fee charged for a primary product or service rela tive to a related product or service, and customer segment and geography. Additional consideration is also given to market conditions such as competitor pricing strategies and market trend. The Company reviews its determination of VSOE, TPE and ESP on an a nnual basis or more frequently as needed. In the MIS segment, revenue attributed to initial ratings of issued securities is recognized when the rating is issued. Revenue attributed to monitoring of issuers or issued securities is recognized ratably over th e period in which the monitoring is performed, generally one year. In the case of commercial mortgage-backed securities, structured credit , international residential mortgage-backed and asset-backed securities, issuers can elect to pay the monitoring fees upfront. These fees are deferred and recognized over the future monitoring periods based on the expected lives of the rated securities, which was approximately 27 years on a weighted average basis at December 31, 2015 . At December 31, 2015 , 2014 and 2013 , deferred revenue related to these securities was approximately $ 121 million , $ 107 million, and $ 97 million. Multiple element revenue arrangements in the MIS segment are g enerally comprised of an initial rating and the related monitoring service. I n instances where monitoring fees are not charged for the first year monitoring effort, fees are allocated to the initial rating and monitoring services based on the relative sell ing price of each service to the total arrangement fees. The Company generally uses ESP in determining the selling price for its initial ratings as the Company rarely sells initial ratings separately without providing related monitoring services and thus i s unable to establish VSOE or TPE for initial ratings. MIS estimates revenue for ratings of commercial paper for which, in addition to a fixed annual monitoring fee, issuers are billed quarterly based on amounts outstanding. Revenue is accrued each quarte r based on estimated amounts outstanding and is billed when actual data is available. The estimate is determined based on the issuers’ most recent reported quarterly data. At December 31, 2015 , 2014 and 2013 , accounts receivable included approximately $ 24 million , $ 22 million, and $ 21 million, respectively, related to accrued commercial paper revenue. Historically, MIS has not had material differences between the estimated reven ue and the actual billings. Furthermore, for certain annual monitoring services, fees are not invoiced until the end of the annual monitoring period and revenue is accrued ratably over the monitoring period. At December 31, 2015, 2014, and 2013, accounts r eceivable included approximately $146.4 million, $127.8 million, and $96.7 million, respectively, relating to accrued monitoring service revenue. In the MA segment, products and services offered by the Company include software licenses and related mainten ance, subscriptions, and professional services. Revenue from subscription based products, such as research and data subscriptions and certain software-based credit risk management subscription products, is recognized ratably over the related subscription p eriod, which is principally one year. Revenue from sale of perpetual licenses of credit processing software is generally recognized at the time the product master or first copy is delivered or transferred to and accepted by the customer. If uncertainty exi sts regarding customer acceptance of the product or service, revenue is not recognized until acceptance occurs . Software maintenance revenue is recognized ratably over the annual maintenance period. Revenue from professional services rendered is generally recognized as the services are performed. A large portion of annual research and data subscriptions and annual software maintenance are invoiced in the months of November, December and January. Products and services offered within the MA segment are sold either stand-alone or together in various combinations. In instances where a multiple element arrangement includes software and non-software deliverables, revenue is allocated to the non-software deliverables and to the software deliverables, as a group, u sing the relative selling prices of each of the deliverables in the arrangement based on the aforementioned selling price hierarchy. Revenue is recognized for each element based upon the conditions for revenue recognition noted above. If the arrangement c ontains more than one software deliverable, the arrangement consideration allocated to the software deliverables as a group is allocated to each software deliverable using VSOE. In the instances where the Company is not able to determine VSOE for all of th e deliverables of an arrangement, the Company allocates the revenue to the undelivered elements equal to its VSOE and the residual revenue to the delivered elements. If the Company is unable to determine VSOE for an undelivered element, the Company defers all revenue allocated to the software deliverables until the Company has delivered all of the elements or when VSOE has been determined for the undelivered elements. In cases where software implementation services are considered essential and VSOE of fair value exists for post-contract customer support (“PCS”), once the delivery criteria has been met on the standard software, license and service revenue is recognized on a percentage-of-completion basis as implementation services are performed, while PCS is recognized over the coverage period. If VSOE of fair value does not exist for PCS, once the delivery criteria has been met on the standard software, service revenue is recognized on a zero profit margin basis until essential services are complete, at whic h point total remaining arrangement revenue is then spread ratably over th e remaining PCS coverage period. If VSOE does not exist for PCS at the beginning of an arrangement but is established during implementation, revenue not recognized due to the absence of VSOE will be recognized on a cumulative basis. Accounts Receivable Allowances Moody’s records an allowance for estimated future adjustments to customer billings as a reduction of revenue, based on historical experience and current conditions. Such amounts are reflected as additions to the accounts receivable allowance. Additionally, estimates of uncollectible accounts are recorded as bad debt expense and are reflected as additions to the accounts receivable allowance. Actual b illing adjustments and uncollectible account write-offs are recorded against the allowance. Moody’s evaluates its accounts receivable allowance by reviewing and assessing historical collection and adjustment experience and the current status of customer accounts. Moody’s also co nsiders the economic environment of the customers, both from an industry and geographic perspective, in evaluating the need for allowances. Based on its analysis, Moody’s adjusts its allowance as considered appropriate in the circumstances. Contingencies Moody’s is involved in legal and tax proceedings, governmental investigations and inquiries , claims and litigation that are incidental to the Company’s business, including claims based on ratings assigned by MIS. Moody’s is also subject to ongoing tax audits in the normal course of business. Management periodically assesses the Company’s liabilities and contingencies in connection with these matters based upon the latest information available. Moody’s discloses material pending legal proceedings pursua nt to SEC rules and other pending matters as it may determine to be appropriate. For claims, litigation and proceedings and governmental investigations and inquires not related to income taxes, where it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated, the Company records liabilities in the consolidated financial statements and periodically adjusts these as appropriate . When the reasonable estimate of the loss is within a range of amounts, the minimum a mount of the range is accrued unless some higher amount within the range is a better estimate than another amount within the range . In other instances, because of uncertainties related to the probable outcome and/or the amount or range of loss, management does not record a liability but discloses the contingency if significant. As additional information becomes available, the Company adjusts its assessments and estimates of such matters accordingly. In view of the inherent difficulty of predicting the outco me of litigation, regulatory , governmental investigations and inquiries , enforcement and similar matters , particularly where the claimants seek large or indeterminate damages or where the parties assert novel legal theories or the matters involve a large number of parties, the Company cannot predict what the eventual outcome of the pending matters will be or the timing of any resolution of such matters. The Company also cannot predict the impact (if any) that any such matters may have on how its business i s conducted, on its competitive position or on its financial position, results of operations or cash flows. As the process to resolve any pending matters progresses, management will continue to review the latest information available and assess its ability to predict the outcome of such matters and the effects, if any, on its operations and financial condition. However, in light of the large or indeterminate damages sought in some of them, the absence of similar court rulings on the theories of law asserted and uncertainties regarding apportionment of any potential damages, an estimate of the range of possible losses cannot be made at this time. The Company’s wholly-owned insurance subsidiary insures the Company against certain risks including but not limi ted to deductibles for worker’s compensation, employ ment practices litigation and employee medical claims and terrorism , for which the claims are not material to the Company. In addition, for claim years 2008 and 2009 , the insurance subsidiary insured th e Company for defense costs related to professional liability claims. For matters insured by the Company’s insurance subsidiary, Moody’s records liabilities based on the estimated total claims expected to be paid and total projected costs to defend a clai m through its anticipated conclusion. The Company determines liabilities based on an assessment of management’s best estimate of claims to be paid and legal defense costs as well as actuarially determined estimates. D efense costs for matters not self-ins ured by the Company’s wholly-owned insurance subsidiary are expensed as services are provided . For income tax matters, the Company employs the prescribed methodology of Topic 740 of the ASC which requires a company to first determine whether it is more- likely-than-not (defined as a likelihood of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming that taxing authorities will examine the position and have full knowledge of all rel evant information. A tax position that meets this more-likely-than-not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty percent likely to be realized upon effective settlement with a taxing authority . O perating Expenses Operating expenses include costs associated with the development and production of the Company’s products and services and their delivery to customers. These expenses principally include employee compensation and benefits and travel costs that are incurred in connection with these activities. Operating expenses are charged to income as incurred, except for certain costs related to software implementation services which are deferred until related revenue is recognized. Additionally, certain costs incurred to develop internal use software are capitalized and depreciated over their estimated useful life. Selling, General and Administrative Expenses SG&A expenses include such items as compensation and benefits for corporate officers and staff and compensation and other expenses related to sales of products. They also include ite ms such as office rent, business insurance, professional fees and gains and losses from sales and disposals of assets. SG&A expenses are charged to income as incurred, except for certain expenses incurred to develop internal use software are capitalized an d depreciated over their estimated useful life. Redeemable Noncontrolling I nterest The Company records its redeemable noncontrolling interest at fair value on the date of the related business combination transaction. The redeemable noncontrolling interest represents noncontrolling shareholders’ interest in entities which are controlled but not wholly-owned by Moody’s and for which Moody’s obligation to redeem the minority shareholders’ interest is governed by a put/call relationship. Subsequent to the initi al measurement, the redeemable noncontrolling interest is recorded at the greater of its redemption value or its carrying value at the end of each reporting period. If the redeemable noncontrolling interest is carried at its redemption value, the differen ce between the redemption value and the carrying value would be adjusted through capital surplus at the end of each reporting period. The Company also performs a quarterly assessment to determine if the aforementioned redemption value exceeds the fair val ue of the redeemable noncontrolling interest. If the redemption value of the redeemable noncontrolling interest were to exceed its fair value, the excess would reduce the net income attributable to Moody’s shareholders. The Company settled its redeemable noncontrolling interest in the fourth quarter of 2014 by exercising its call option to acquire the remaining share of Copal Amba that it did not previously own. Foreign Currency Translation For all operations outside the U.S. where the Company has design ated the local currency as the functional currency, assets and liabilities are translated into U.S. dollars using end of year exchange rates, and revenue and expenses are translated using average exchange rates for the year. For these foreign operations, c urrency translation adjustments are accumulated in a separate component of shareholders’ (deficit)/ equity. Comprehensive Income Comprehensive income represents the change in net assets of a business enterprise during a period due to transactions and other events and circumstances from non-owner sources including foreign currency translation impacts, net actuarial losses and net prior service cos ts related to pension and other retirement plans, gains and losses on derivative instruments and unrealized gains and losses on securities designated as ‘available-for-sale’ under Topic 320 of the ASC . Income Taxes The Company accounts for income taxes under the asset and liability method in accordance with ASC Topic 740. Therefore, income tax expense is based on reported income before income taxes and deferred income taxes reflect the effect of temporary differences between the amounts of assets and liabilities that are recognized for financial reporting purposes and the amounts that are recognized for income tax purposes. The Company classifies in terest related to unrecognized tax benefits as a component of interest expense in its consolidated statements of operations. Penalties are recognized in other non-operating expenses. For UTPs, the Company first determines whether it is more-likely-than-not (defined as a likelihood of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming that taxing authorities will examine the position and have full knowledge of all relevant informati on. A tax position that meets this more-likely-than-not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty percent likely to be realized upon effective settlement with a taxing authority. For certain of it s non-U.S. subsidiaries, the Company has deemed the undistributed earnings relating to these subsidiaries to be indefinitely reinvested within its foreign operations. Accordingly, the Company has not provided deferred income taxes on these indefinitely rei nvested earnings. It is not practicable to determine the amount of deferred taxes that might be required to be provided if such earnings were distributed in the future due to complexities in the tax laws and in the hypothetical calculations that would have to be made. Fair Value of Financial Instruments The Company’s financial instruments include cash, cash equivalents, trade receivables and payables, all of which are short-term in nature and, accordingly, approximate fair value. Additionally, the Company i nvests in certain short-term investments consisting primarily of certificates of deposit that are carried at cost, which approximates fair value due to their short-term maturities. The Company also has certain investments in closed-ended and open-ended m utual funds in India which are designated as ‘available for sale’ under Topic 320 of the ASC. Accordingly, unrealized gains and losses on these investments are recorded to other comprehensive income and are reclassified out of accumulated other comprehens ive income to the statement of operations when the investment matures or is sold using a specific identification method. Also, the Company uses derivative instruments, as further described in Note 5, to manage certain financial exposures that occur in t he normal course of business. These derivative instruments are carried at fair value on the Company’s consolidated balance sheets. The Company also was subject to contingent consideration obligations related to certain of its acquisitions as more fully di scussed in Note 9. These obligations were carried at their estimated fair value within the Company’s consolidated balance sheets. Fair value is defined by the ASC as the price that would be received from selling an asset or paid to transfer a liability (i.e., an exit price) in an orderly transaction between market participants at the measurement date. The determination of this fair value is based on the principal or most advantageous market in which the Company could commence transactions and considers a ssumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions and risk of nonperformance. Also, determination of fair value assumes that market participants will consider the highest and bes t use of the asset. The ASC establishes a fair value hierarchy whereby the inputs contained in valuation techniques used to measure fair value are categorized into three broad levels as follows: Level 1 : quoted market prices in active markets that the rep orting entity has the ability to access at the date of the fair value measurement; Level 2 : inputs other than quoted market prices described in Level 1 that are observable for the asset or liability, either directly or indirectly, s |
SUMMARY OF SIGNIFICANT ACCOUN13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include those of Moody’s Corporation and its majority- and wholly-owned subsidiaries. The effects of all intercompany transactions have been eliminated. Investments in companies for which the Company has significant influence over operating and financial policies but not a controlling interest are accounted for on an equity basis whereby the Company records its proportional share of the investm ent’s net income or loss as part of other non-operating income (expense), net and any dividends received reduce the carrying amount of the investment. The Company applies the guidelines set forth in Topic 810 of the ASC in assessing its interests in varia ble interest entities to decide whether to consolidate that entity. The Company has reviewed the potential variable interest entities and determined that there are no consolidation requirements under Topic 810 of the ASC. The Company consolidates its ICRA subsidiaries on a three month lag. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents principally consist of investments in money market mutual funds and money market deposit accounts as well as high-grade commercial paper and certificates of deposit with maturit ies of three months or less when purchased. |
Short-term Investments | Short-term Investments Short-term investments are securities with maturities greater than 90 days at the time of purchase that are available for operations in the next 12 months. The Company’s short-term investments primarily consist of certificates of deposit and their cost approximates fair value due to the short-term nature of the instruments. Interest and dividends on these investments are recorded into income when earned. |
Property and Equipment | Property and Equipment Pro perty and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives. Expenditures for maintenance and repairs that do not extend the economic useful life of the related assets are charged to expense as incurred. |
Research and Development Costs | Research and Development Costs All research and development costs are expensed as incurred. These costs primarily reflect the development of credit processing software and quantitative credit risk assessment products sold by the MA segment. Research and development costs were $ 29.1 million , $ 37.9 million, and $ 22.8 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, and are included in operating expense s within the Company’s consolidated statements of operations. These costs generally consist of professional services provided by third parties and compensation costs of employees. Costs for internally developed computer software that will be sold, leased or otherwise marketed are capitalized when technological feasibility has been established. These costs primarily relate to the development or enhancement of products in the ERS business and generally consist of professional services provided by third part ies and compensation costs of employees that develop the software. Judgment is required in determining when technological feasibility of a product is established and the Company believes that technological feasibility for its software products is reached a fter all high-risk development issues have been resolved through coding and testing. Generally, this occurs shortly before the products are released to customers. Accordingly, costs for internally developed computer software that will be sold, leased or ot herwise marketed that were eligible for capitalization under Topic 985 of the ASC as well as the related amortization expense related to such costs were immaterial for the years ended December 31, 2015 , 2014 and 2013 . |
Computer Software Developed or Obtained for Internal Use | Compu ter Software Developed or Obtained for Internal Use The Company capitalizes costs related to software developed or obtained for internal use. These assets, included in property and equipment in the consolidated balance sheets, relate to the Company’s accou nting, product delivery and other systems. Such costs generally consist of direct costs for third-party license fees, professional services provided by third parties and employee compensation, in each case incurred either during the application development stage or in connection with upgrades and enhancements that increase functionality. Such costs are depreciated over their estimated useful lives on a straight-line basis. Costs incurred during the preliminary project stage of development as well as mainten ance costs are expensed as incurred. |
Long-Lived Assets, Including Goodwill and Other Acquired Intangible Assets | Long-Lived Assets, Including Goodwill and Other Acquired Intangible Assets Moody’s evaluates its goodwill for impairment at the reporting unit level, defined as an operating segment or one level below an operating segme nt, annually as of July 31 or more frequentl y if impairment indicators arise in accordance with ASC Topic 350. The Company evaluates the recoverability of goodwill using a three-step impairment test approach at the reporting unit level. In the first step, the Company assesses various qualitative factors to determine whether the fair value of a reporting unit may be less than its carrying amount. If a determination is made that, based on the qualitative factors, an impairment does not exist, the Company is not required to perform further testing. If the aforementioned qualitative assessment results in the Company concluding that it is more likely than not that the fair value of a reporting unit may be less than its carrying amount, the fair value of the repo rting unit will be determined and compared to its carrying value including goodwill. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is not impaired and the Company is not required to per form further testing. If the fair value of the reporting unit is less than the carrying value, the Company must perform a third step of the impairment test to determine the implied fair value of the reporting unit’s goodwill. The implied fair value of the goodwill is determined based on the difference between the fair value of the reporting unit and the net fair value of the identifiable assets and liabilities of the reporting unit. If the implied fair value of the goodwill is less than its carrying value, the difference is recognized as an impairment charge. For the reporting units where the Company is consistently able to conclude that an impairment does not exist using only a qualitative approach, the Company’s accounting policy is to perform the second s tep of the aforementioned goodwill impairment assessment at least once every three years. Goodwill is assigned to a reporting unit at the date when an acquisition is integrated into one of the established reporting units, and is based on which reporting un it is expected to benefit from the synergies of the acquisition. For purposes of assessing the recoverability of goodwill, the Company has six primary reporting units at December 31, 2015 : two within the Company’s ratings business (one for the ICRA busine ss and one that encompasses all of Moody’s other ratings operations) and four reporting units within MA: RD&A, ERS, Financial Services Training and Certificatio ns and Copal Amba . The RD&A reporting unit encompasses the distribution of investor-oriented res earch and data developed by MIS as part of its ratings process, in-depth research on major debt issuers, industry studies, economic research and commentary on topical events and credit analytic tools. The ERS reporting unit consists of credit risk manageme nt and compliance software that is sold on a license or subscription basis as well as related advisory services for implementation and maintenance. The FSTC reporting unit consists of the portion of the MA business that offers both credit training as well as other professional development training and certification services. The Copal Amba reporting unit consists of outsourced research and analytical services. Amortizable intangible assets are reviewed for recoverability whenever events or changes in circu mstances indicate that the carrying amount may not be recoverable. |
Rent Expense | Rent Expense The Company records rent expense on a straight-line basis over the life of the lease. In cases where there is a free rent period or future fixed rent escalations the Company will record a deferred rent liability. Additionally, the receipt of any lease incentives will be recorded as a deferred rent liability which will be amortized over the lease term as a reduction of rent expense. |
Stock-Based Compensation | Stock-Based Compensation The Company records compensation expense for all share-based payment award transactions granted to employees based on the fair value of the equity instrument at the time of grant. This includes shares issued under stock option and restricted stock plans . The Company has also established a pool of additional paid-in capital related to the tax effects of employee share-based compensation, which is available to absorb any recognized tax shortfalls . |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities Based on the Company’s risk management policy, from time to time the Company may use derivative financial instruments to reduce exposure to changes in foreign exchange rates and interest rates. The Company does not enter into derivative financial instruments for speculative purposes. All derivative financial instruments are recorded on the balance sheet at their respective fair values. The changes in the value of derivatives that qualify as fair value hedges are recorded with a corresponding adjustment to the carrying value of the item being hedged . Changes in the derivative’s fair value that qualify as cash flow hedges are recorded to other comprehensive income or loss, to the extent the hedge is effective, and such amounts are reclassified from accumulated other comprehensive income or loss to earnings in the same period or periods during which the hedged transaction affects income. Changes in the deriva tive’s fair value that qualify as net investment hedges are recorded to other comprehensive income or loss, to the extent the hedge is effective. Any changes in the fair value of derivatives that the Company does not designate as hedging instruments under Topic 815 of the ASC are recorded in the consolidated statements of operations in the period in which they occur. |
Revenue Recognition | Revenue Recognition Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or the services have been provided and accepted by the customer when applicable, fees are determinable and the collection of resulting receivables is considered probable. Pursuant to ASC Topic 605 , when a sales arrangement contains multiple deliverables, the Company allocates reve nue to each deliverable based on its relative selling price which is determined based on its vendor spec ific objective evidence if availab le, third party evidence if VSOE is not available, or estimated selling price if neither VSOE nor TPE is available. The Company’s products and services will generally qualify as separate units of accounting under ASC Topic 605 . The Company evaluates each deliverable in an arrangement to determine whether it represents a separate unit of accounting. A deliverable consti tutes a separate unit of accounting when it has stand-alone value to the customers and if the arrangement includes a customer refund or return right relative to the delivered item and the delivery and performance of the undelivered item is considered proba ble and substantially in the Company’s control. In instances where the aforementioned criteria are not met, the deliverable is combined with the undelivered items and revenue recognition is determined as one single unit. The Company determines whether its selling price in a multi-element transaction meets the VSOE criteria by using the price charged for a deliverable when sold separately or, if the deliverable is not yet being sold separately, the price established by management having the relevant authorit y to establish such a price . In instances where the Company is not able to establish VSOE for all deliverables in a multiple element arrangement, which may be due to the Company infrequently selling each element separately, not selling products within a re asonably narrow price range, or only having a limited sales history, the Company attempts to establish TPE for deliverables. The Company determines whether TPE exists by evaluating largely similar and interchangeable competitor products or services in stan dalone sales to similarly situated customers. However, due to the difficulty in obtaining third party pricing, possible differences in its market strategy from that of its peers and the potential that products and services offered by the Company may contai n a significant level of differentiation and/or customization such that the comparable pricing of products with similar functionality cannot be obtained, the Company generally is unable to reliably determine TPE. Based on the selling price hierarchy establ ished by ASC Topic 605 , when the Company is unable to establish selling price using VSOE or TPE, the Company will establish an ESP. ESP is the price at which the Company would transact a sale if the product or service were sold on a stand-alone basis. The Company establishes its best estimate of ESP considering internal factors relevant to is pricing practices such as costs and margin objectives, standalone sales prices of similar products, percentage of the fee charged for a primary product or service rela tive to a related product or service, and customer segment and geography. Additional consideration is also given to market conditions such as competitor pricing strategies and market trend. The Company reviews its determination of VSOE, TPE and ESP on an a nnual basis or more frequently as needed. In the MIS segment, revenue attributed to initial ratings of issued securities is recognized when the rating is issued. Revenue attributed to monitoring of issuers or issued securities is recognized ratably over th e period in which the monitoring is performed, generally one year. In the case of commercial mortgage-backed securities, structured credit , international residential mortgage-backed and asset-backed securities, issuers can elect to pay the monitoring fees upfront. These fees are deferred and recognized over the future monitoring periods based on the expected lives of the rated securities, which was approximately 27 years on a weighted average basis at December 31, 2015 . At December 31, 2015 , 2014 and 2013 , deferred revenue related to these securities was approximately $ 121 million , $ 107 million, and $ 97 million. Multiple element revenue arrangements in the MIS segment are g enerally comprised of an initial rating and the related monitoring service. I n instances where monitoring fees are not charged for the first year monitoring effort, fees are allocated to the initial rating and monitoring services based on the relative sell ing price of each service to the total arrangement fees. The Company generally uses ESP in determining the selling price for its initial ratings as the Company rarely sells initial ratings separately without providing related monitoring services and thus i s unable to establish VSOE or TPE for initial ratings. MIS estimates revenue for ratings of commercial paper for which, in addition to a fixed annual monitoring fee, issuers are billed quarterly based on amounts outstanding. Revenue is accrued each quarte r based on estimated amounts outstanding and is billed when actual data is available. The estimate is determined based on the issuers’ most recent reported quarterly data. At December 31, 2015 , 2014 and 2013 , accounts receivable included approximately $ 24 million , $ 22 million, and $ 21 million, respectively, related to accrued commercial paper revenue. Historically, MIS has not had material differences between the estimated reven ue and the actual billings. Furthermore, for certain annual monitoring services, fees are not invoiced until the end of the annual monitoring period and revenue is accrued ratably over the monitoring period. At December 31, 2015, 2014, and 2013, accounts r eceivable included approximately $146.4 million, $127.8 million, and $96.7 million, respectively, relating to accrued monitoring service revenue. In the MA segment, products and services offered by the Company include software licenses and related mainten ance, subscriptions, and professional services. Revenue from subscription based products, such as research and data subscriptions and certain software-based credit risk management subscription products, is recognized ratably over the related subscription p eriod, which is principally one year. Revenue from sale of perpetual licenses of credit processing software is generally recognized at the time the product master or first copy is delivered or transferred to and accepted by the customer. If uncertainty exi sts regarding customer acceptance of the product or service, revenue is not recognized until acceptance occurs . Software maintenance revenue is recognized ratably over the annual maintenance period. Revenue from professional services rendered is generally recognized as the services are performed. A large portion of annual research and data subscriptions and annual software maintenance are invoiced in the months of November, December and January. Products and services offered within the MA segment are sold either stand-alone or together in various combinations. In instances where a multiple element arrangement includes software and non-software deliverables, revenue is allocated to the non-software deliverables and to the software deliverables, as a group, u sing the relative selling prices of each of the deliverables in the arrangement based on the aforementioned selling price hierarchy. Revenue is recognized for each element based upon the conditions for revenue recognition noted above. If the arrangement c ontains more than one software deliverable, the arrangement consideration allocated to the software deliverables as a group is allocated to each software deliverable using VSOE. In the instances where the Company is not able to determine VSOE for all of th e deliverables of an arrangement, the Company allocates the revenue to the undelivered elements equal to its VSOE and the residual revenue to the delivered elements. If the Company is unable to determine VSOE for an undelivered element, the Company defers all revenue allocated to the software deliverables until the Company has delivered all of the elements or when VSOE has been determined for the undelivered elements. In cases where software implementation services are considered essential and VSOE of fair value exists for post-contract customer support (“PCS”), once the delivery criteria has been met on the standard software, license and service revenue is recognized on a percentage-of-completion basis as implementation services are performed, while PCS is recognized over the coverage period. If VSOE of fair value does not exist for PCS, once the delivery criteria has been met on the standard software, service revenue is recognized on a zero profit margin basis until essential services are complete, at whic h point total remaining arrangement revenue is then spread ratably over th e remaining PCS coverage period. If VSOE does not exist for PCS at the beginning of an arrangement but is established during implementation, revenue not recognized due to the absence of VSOE will be recognized on a cumulative basis. |
Accounts Receivable Allowances | Accounts Receivable Allowances Moody’s records an allowance for estimated future adjustments to customer billings as a reduction of revenue, based on historical experience and current conditions. Such amounts are reflected as additions to the accounts receivable allowance. Additionally, estimates of uncollectible accounts are recorded as bad debt expense and are reflected as additions to the accounts receivable allowance. Actual b illing adjustments and uncollectible account write-offs are recorded against the allowance. Moody’s evaluates its accounts receivable allowance by reviewing and assessing historical collection and adjustment experience and the current status of customer accounts. Moody’s also co nsiders the economic environment of the customers, both from an industry and geographic perspective, in evaluating the need for allowances. Based on its analysis, Moody’s adjusts its allowance as considered appropriate in the circumstances. |
Contingencies | Contingencies Moody’s is involved in legal and tax proceedings, governmental investigations and inquiries , claims and litigation that are incidental to the Company’s business, including claims based on ratings assigned by MIS. Moody’s is also subject to ongoing tax audits in the normal course of business. Management periodically assesses the Company’s liabilities and contingencies in connection with these matters based upon the latest information available. Moody’s discloses material pending legal proceedings pursua nt to SEC rules and other pending matters as it may determine to be appropriate. For claims, litigation and proceedings and governmental investigations and inquires not related to income taxes, where it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated, the Company records liabilities in the consolidated financial statements and periodically adjusts these as appropriate . When the reasonable estimate of the loss is within a range of amounts, the minimum a mount of the range is accrued unless some higher amount within the range is a better estimate than another amount within the range . In other instances, because of uncertainties related to the probable outcome and/or the amount or range of loss, management does not record a liability but discloses the contingency if significant. As additional information becomes available, the Company adjusts its assessments and estimates of such matters accordingly. In view of the inherent difficulty of predicting the outco me of litigation, regulatory , governmental investigations and inquiries , enforcement and similar matters , particularly where the claimants seek large or indeterminate damages or where the parties assert novel legal theories or the matters involve a large number of parties, the Company cannot predict what the eventual outcome of the pending matters will be or the timing of any resolution of such matters. The Company also cannot predict the impact (if any) that any such matters may have on how its business i s conducted, on its competitive position or on its financial position, results of operations or cash flows. As the process to resolve any pending matters progresses, management will continue to review the latest information available and assess its ability to predict the outcome of such matters and the effects, if any, on its operations and financial condition. However, in light of the large or indeterminate damages sought in some of them, the absence of similar court rulings on the theories of law asserted and uncertainties regarding apportionment of any potential damages, an estimate of the range of possible losses cannot be made at this time. The Company’s wholly-owned insurance subsidiary insures the Company against certain risks including but not limi ted to deductibles for worker’s compensation, employ ment practices litigation and employee medical claims and terrorism , for which the claims are not material to the Company. In addition, for claim years 2008 and 2009 , the insurance subsidiary insured th e Company for defense costs related to professional liability claims. For matters insured by the Company’s insurance subsidiary, Moody’s records liabilities based on the estimated total claims expected to be paid and total projected costs to defend a clai m through its anticipated conclusion. The Company determines liabilities based on an assessment of management’s best estimate of claims to be paid and legal defense costs as well as actuarially determined estimates. D efense costs for matters not self-ins ured by the Company’s wholly-owned insurance subsidiary are expensed as services are provided . For income tax matters, the Company employs the prescribed methodology of Topic 740 of the ASC which requires a company to first determine whether it is more- likely-than-not (defined as a likelihood of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming that taxing authorities will examine the position and have full knowledge of all rel evant information. A tax position that meets this more-likely-than-not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty percent likely to be realized upon effective settlement with a taxing authority |
Operating Expenses | O perating Expenses Operating expenses include costs associated with the development and production of the Company’s products and services and their delivery to customers. These expenses principally include employee compensation and benefits and travel costs that are incurred in connection with these activities. Operating expenses are charged to income as incurred, except for certain costs related to software implementation services which are deferred until related revenue is recognized. Additionally, certain costs incurred to develop internal use software are capitalized and depreciated over their estimated useful life. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses SG&A expenses include such items as compensation and benefits for corporate officers and staff and compensation and other expenses related to sales of products. They also include ite ms such as office rent, business insurance, professional fees and gains and losses from sales and disposals of assets. SG&A expenses are charged to income as incurred, except for certain expenses incurred to develop internal use software are capitalized an d depreciated over their estimated useful life. |
Redeemable Noncontrolling Interest | Redeemable Noncontrolling I nterest The Company records its redeemable noncontrolling interest at fair value on the date of the related business combination transaction. The redeemable noncontrolling interest represents noncontrolling shareholders’ interest in entities which are controlled but not wholly-owned by Moody’s and for which Moody’s obligation to redeem the minority shareholders’ interest is governed by a put/call relationship. Subsequent to the initi al measurement, the redeemable noncontrolling interest is recorded at the greater of its redemption value or its carrying value at the end of each reporting period. If the redeemable noncontrolling interest is carried at its redemption value, the differen ce between the redemption value and the carrying value would be adjusted through capital surplus at the end of each reporting period. The Company also performs a quarterly assessment to determine if the aforementioned redemption value exceeds the fair val ue of the redeemable noncontrolling interest. If the redemption value of the redeemable noncontrolling interest were to exceed its fair value, the excess would reduce the net income attributable to Moody’s shareholders. The Company settled its redeemable noncontrolling interest in the fourth quarter of 2014 by exercising its call option to acquire the remaining share of Copal Amba that it did not previously own. |
Foreign Currency Translation | Foreign Currency Translation For all operations outside the U.S. where the Company has design ated the local currency as the functional currency, assets and liabilities are translated into U.S. dollars using end of year exchange rates, and revenue and expenses are translated using average exchange rates for the year. For these foreign operations, c urrency translation adjustments are accumulated in a separate component of shareholders’ (deficit)/ equity. |
Comprehensive Income | Comprehensive Income Comprehensive income represents the change in net assets of a business enterprise during a period due to transactions and other events and circumstances from non-owner sources including foreign currency translation impacts, net actuarial losses and net prior service cos ts related to pension and other retirement plans, gains and losses on derivative instruments and unrealized gains and losses on securities designated as ‘available-for-sale’ under Topic 320 of the ASC . |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method in accordance with ASC Topic 740. Therefore, income tax expense is based on reported income before income taxes and deferred income taxes reflect the effect of temporary differences between the amounts of assets and liabilities that are recognized for financial reporting purposes and the amounts that are recognized for income tax purposes. The Company classifies in terest related to unrecognized tax benefits as a component of interest expense in its consolidated statements of operations. Penalties are recognized in other non-operating expenses. For UTPs, the Company first determines whether it is more-likely-than-not (defined as a likelihood of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming that taxing authorities will examine the position and have full knowledge of all relevant informati on. A tax position that meets this more-likely-than-not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty percent likely to be realized upon effective settlement with a taxing authority. For certain of it s non-U.S. subsidiaries, the Company has deemed the undistributed earnings relating to these subsidiaries to be indefinitely reinvested within its foreign operations. Accordingly, the Company has not provided deferred income taxes on these indefinitely rei nvested earnings. It is not practicable to determine the amount of deferred taxes that might be required to be provided if such earnings were distributed in the future due to complexities in the tax laws and in the hypothetical calculations that would have to be made. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments include cash, cash equivalents, trade receivables and payables, all of which are short-term in nature and, accordingly, approximate fair value. Additionally, the Company i nvests in certain short-term investments consisting primarily of certificates of deposit that are carried at cost, which approximates fair value due to their short-term maturities. The Company also has certain investments in closed-ended and open-ended m utual funds in India which are designated as ‘available for sale’ under Topic 320 of the ASC. Accordingly, unrealized gains and losses on these investments are recorded to other comprehensive income and are reclassified out of accumulated other comprehens ive income to the statement of operations when the investment matures or is sold using a specific identification method. Also, the Company uses derivative instruments, as further described in Note 5, to manage certain financial exposures that occur in t he normal course of business. These derivative instruments are carried at fair value on the Company’s consolidated balance sheets. The Company also was subject to contingent consideration obligations related to certain of its acquisitions as more fully di scussed in Note 9. These obligations were carried at their estimated fair value within the Company’s consolidated balance sheets. Fair value is defined by the ASC as the price that would be received from selling an asset or paid to transfer a liability (i.e., an exit price) in an orderly transaction between market participants at the measurement date. The determination of this fair value is based on the principal or most advantageous market in which the Company could commence transactions and considers a ssumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions and risk of nonperformance. Also, determination of fair value assumes that market participants will consider the highest and bes t use of the asset. The ASC establishes a fair value hierarchy whereby the inputs contained in valuation techniques used to measure fair value are categorized into three broad levels as follows: Level 1 : quoted market prices in active markets that the rep orting entity has the ability to access at the date of the fair value measurement; Level 2 : inputs other than quoted market prices described in Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full t erm of the assets or liabilities; Level 3 : unobservable inputs that are supported by little or no market activity and that are significant to the fair value measurement of the assets or liabilities. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk principally consist of cash and cash equivalents, short-term investments, trade receivables and derivatives. The Company manages its credit risk exposure by allocating its cash equivalents amo ng various money market mutual funds, money market deposit accounts, certificates of deposits and high- grade commercial paper. Short-term investments primarily consist of certificates of deposit as of December 31, 2015 and 2014 . The C ompany manages its credit risk exposure on cash equivalents and short-term investments by limiting the amount it can invest with any single entity. No customer accounted for 10 % or more of accounts receivable at December 31, 2015 or 2014 . |
Earnings per Share of Common Stock | Earnings per Share of Common Stock Basic shares outstanding is calculated based on the weighted average number of shares of common stock outstanding during the reporting period. Diluted shares outstanding is calculated giving effect to all potentially dilutive common shares, assuming that such shares were outstanding during the reporting period. |
Pension and Other Retirement Benefits | Pension and Other Retirement Benefits Moody’s maintains various noncontributory DBPPs as well as other contributory and noncontributory retirement plans. The expense and assets/liabilities that the Company reports for its pension and other retirement benefits are dependent on many assumptions concerning the outcome of future events and circumstances. These assumptions represent the Company ’s best estimates and may vary by plan. The differences between the assumptions for the expected long-term rate of return on plan assets and actual experience is spread over a five-year period to the market related value of plan assets which is used in de termining the expected return on assets component of annual pension expense. All other actuarial gains and losses are generally deferred and amortized over the estimated average future working life of active plan participants. The Company recognizes as an asset or liability in its consolidated balance sheet the funded status of its defined benefit retirement plans, measured on a plan-by-plan basis. Changes in the funded status due to actuarial gains/losses are recorded as part of other comprehensive inco me during the period the changes occur. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of con tingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates. Estimates are used for, but not limited to, revenue recognition, a ccounts receivable allowances, income taxes, contingencies, valuation of long-lived and intangible assets, goodwill, pension and other retirement benefits, stock-based compensation, and depreciable lives for property and equipment and computer software. |
Recently Issued Accounting Pronouncements | Re cently Issued Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers”. This ASU outlines a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transf er of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. The Company is currently evaluating its adoption options and the impact that adoption of this update will have on its consolidated financial statements. Currently, the Company believes this ASU will have an impact on: i) the capitalization of certain contract implementation costs; ii) the accounting for certain software license and maintenance revenue in MA; iii) the accounting for certain revenue arrangements where VSOE is not available and iv) the accounting for contract acquisition costs. In August 2015, the FASB issued ASU No. 2015-14 “Revenue from Contracts with Customers (Topic 606), Deferral of the Effectiv e Date” which defers the effective date of the ASU for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted up to the original effective date of December 15, 2016. In April 2015, the FASB issued ASU No. 20 15-05 “Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement”. This ASU provides guidance on accounting for fees paid by a customer in a cloud computing arrangement. In accordance with the ASU , a cloud computing arrangement that contains a so ftware license should be accounted for consistently with the acquisition of other software licenses. If no software license is present in the contract, the entity should account for the arrangement as a service contract. The Company can elect to apply this ASU either retrospectively or prospectively effective for annual and interim reporting periods beginning after December 15, 2015, and early adoption is permitted. The adoption of this ASU in 2016 will not have a material impact on the Company’s financial statements. In April 2015, the FASB issued ASU No. 2015-03,“Simplifying the Presentation of Debt Issuance Costs”. This ASU simplifies the presentation of debt issuance costs in financial statements and requires a company to present such costs in the balanc e sheet as a direct deduction from the related debt liability rather than as an asset. Amortization costs will continue to be reported as interest expense. The ASU is effective retrospectively for annual and interim reporting periods beginning after Decemb er 15, 2015, and early adoption is permitted. The adoption of this ASU will impact the presentation of debt issuance costs in the Company’s consolidated balance sheets. Additionally, in August 2015, the FASB issued ASU No. 2015-15 “Presentation and Subsequ ent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements”. This ASU codifies that given the lack of authoritative guidance in ASU 2015-03 regarding line-of-credit arrangements, the SEC staff would not object to a Company deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt costs ratably over the term of the arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. In May 2015, the FAS B issued ASU No. 2015-07 “Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)”. This ASU removes the requirement to include investments in the fair value hierarchy for which fair value is measured us ing the net asset value per share as a practical expedient. ASU No. 2015-07 is effective retrospectively for fiscal years beginning after December 15, 2015, with early adoption permitted. The adoption of this ASU will only impact the presentation of certa in of the Company’s pension assets in the fair value hierarchy disclosures. In September 2015, the FASB issued ASU No. 2015-16 “Simplifying the Accounting for Measurement-Period Adjustments” in acquisition accounting . This ASU requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments in this ASU require that the acquirer record, in the same period’s financi al statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. ASU No. 2015- 16 is applied prospectively for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The Company does not believe the adoption of this ASU will have a material impact on its financial statements. In November 2015, the FASB issued ASU No. 2015-17 “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes.” This ASU simplifies the presentation of deferred income taxes by requiring all deferred income tax assets and liabilities be classified as non current on the balance sheet. This removes the requirement for the entity to determine whether the deferred tax is current or noncurrent for presentation in the balance sheet. ASU No. 2015-17 is effective for financial statements issued for annual periods beginning after December 15, 2016. The Company has elected to adopt this ASU in the first quarter of 2016 with the adoption affecting the presentation of the Company’s deferred tax assets and liabilities on its balance sheet . In January 2016, the FASB issu ed ASU No. 2016-01 “Financial Instruments – Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10).” The amendments in this ASU update various aspects of recognition, measureme nt, presentation and disclosures relating t o financial instruments. ASU No. 2016-01 is effective for fiscal years beginning after December 15, 2017. The Company is currently evaluating the impact of this ASU on the Company’s financial statements. |
Summary of Significant Accoun14
Summary of Significant Accounting Policies - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||
Research and development costs | $ 29.1 | $ 37.9 | $ 22.8 |
Number of reporting units | 6 | ||
Description of concentration risk, Customer | No customer accounted for 10% or more of accounts receivable at December 31, 2015 or 2014. | ||
Ratings Member [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of reporting units | 2 | ||
MIS [Member] | Ratings Member [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Weighted average expected lives of the rated securities | 27 years | ||
Deferred revenue related to rated securities | $ 121 | 107 | 97 |
MIS [Member] | Ratings Member [Member] | Commercial Paper [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Accounts receivable related to accrued commercial paper revenue | $ 24 | $ 22 | $ 21 |
MA [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of reporting units | 4 |
RECONCILIATION OF WEIGHTED AVER
RECONCILIATION OF WEIGHTED AVERAGE SHARES OUTSTANDING | 12 Months Ended |
Dec. 31, 2015 | |
RECONCILIATION OF WEIGHTED AVERAGE SHARES OUTSTANDING | NOTE 3 RECONCILIATION OF WEIGHTED AVERAGE SHARES OUTSTANDING Below is a reconciliation of basic to diluted shares outstanding : 2015 2014 2013 Basic 200.1 210.7 219.4 Dilutive effect of shares issuable under stock-based compensation plans 3.3 4.0 4.1 Diluted 203.4 214.7 223.5 Antidilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock which are excluded from the table above 0.7 0.7 4.0 The calculation of diluted EPS requires certain assumptions regarding the use of both cash proceeds and assumed proceeds that would be received upon the exercise of stock options and vesting of restricted stock outstanding as of December 31, 2015 , 2014 and 2013 . These assumed proceeds include Excess Tax Benefits and any unrecognized compensation on the awards. The decrease in the diluted shares outstanding primarily reflects treasury share repurchases under the Company’s Boa rd authorized share repurchase program. |
RECONCILIATION OF WEIGHTED AV16
RECONCILIATION OF WEIGHTED AVERAGE SHARES OUTSTANDING (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Reconciliation of Basic to Diluted Shares Outstanding | 2015 2014 2013 Basic 200.1 210.7 219.4 Dilutive effect of shares issuable under stock-based compensation plans 3.3 4.0 4.1 Diluted 203.4 214.7 223.5 Antidilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock which are excluded from the table above 0.7 0.7 4.0 |
Reconciliation of Basic to Dilu
Reconciliation of Basic to Diluted Shares Outstanding (Detail) - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Weighted Average Number Of Diluted Shares Outstanding [Line Items] | |||
Basic | 200.1 | 210.7 | 219.4 |
Dilutive effect of shares issuable under stock-based compensation plans | 3.3 | 4 | 4.1 |
Diluted | 203.4 | 214.7 | 223.5 |
Antidilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock which are excluded from the table above | 0.7 | 0.7 | 4 |
CASH EQUIVALENT AND INVESTMENTS
CASH EQUIVALENT AND INVESTMENTS | 12 Months Ended |
Dec. 31, 2015 | |
CASH EQUIVALENT AND INVESTMENT | NOTE 4 CASH EQUIVALENTS AND INVESTMENTS The table below provides additional information on the Company’s cash equivalents and investments: As of December 31, 2015 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 188.3 $ - $ 188.3 $ 188.3 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 1,307.3 $ - $ 1,307.3 $ 809.4 $ 474.8 $ 23.1 Fixed maturity and open ended mutual funds (2) $ 28.7 $ 3.2 $ 31.9 $ - $ - $ 31.9 As of December 31, 2014 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 149.7 $ - $ 149.7 $ 149.7 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 842.5 $ - $ 842.5 $ 380.1 $ 458.1 $ 4.3 Fixed maturity and open ended mutual funds (2) $ 47.1 $ 0.9 $ 48.0 $ - $ - $ 48.0 (1) Consists of time deposits and money market deposit accounts. The remaining contractual maturities for the certificates of deposits classified as short-term investments were one month to 12 months at December 31, 2015 and one month to 10 months at December 31, 2014. The remaining contractual maturities for the certificates of deposits classified in other assets are one month to 27 months at December 31, 2015 and one month to 39 months at December 31, 2014. Time deposits with a maturity of less than 90 days at time of purchase are classified as cash and cash equivalents. (2) Consists of investments in fixed maturity mutual funds and open-ended mutual funds. The remaining contractual maturities for the fixed maturity instruments range from eleven months to 31 months and two months to 23 months at December 31, 2015 and 2014, respectively. The money market mutual funds as well as the fixed maturity and open ended mutual funds in the table above are deemed to be ‘available for sale’ under ASC Topic 320 and the fair value of these instruments is determined using Level 1 inputs |
CASH EQUIVALENT AND INVESTMEN19
CASH EQUIVALENT AND INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Schedule of Available for sale securities | As of December 31, 2015 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 188.3 $ - $ 188.3 $ 188.3 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 1,307.3 $ - $ 1,307.3 $ 809.4 $ 474.8 $ 23.1 Fixed maturity and open ended mutual funds (2) $ 28.7 $ 3.2 $ 31.9 $ - $ - $ 31.9 As of December 31, 2014 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 149.7 $ - $ 149.7 $ 149.7 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 842.5 $ - $ 842.5 $ 380.1 $ 458.1 $ 4.3 Fixed maturity and open ended mutual funds (2) $ 47.1 $ 0.9 $ 48.0 $ - $ - $ 48.0 (1) Consists of time deposits and money market deposit accounts. The remaining contractual maturities for the certificates of deposits classified as short-term investments were one month to 12 months at December 31, 2015 and one month to 10 months at December 31, 2014. The remaining contractual maturities for the certificates of deposits classified in other assets are one month to 27 months at December 31, 2015 and one month to 39 months at December 31, 2014. Time deposits with a maturity of less than 90 days at time of purchase are classified as cash and cash equivalents. (2) Consists of investments in fixed maturity mutual funds and open-ended mutual funds. The remaining contractual maturities for the fixed maturity instruments range from eleven months to 31 months and two months to 23 months at December 31, 2015 and 2014, respectively. |
Cash Equivalent and Investmen20
Cash Equivalent and Investments (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Money Market [Member] | ||
Schedule of Available-for-sale Securities [Line Item] | ||
Cost | $ 188.3 | $ 149.7 |
Fair Value | 188.3 | 149.7 |
Cash and Cash Equivalents | 188.3 | 149.7 |
Certificates of Deposit [Member] | ||
Schedule of Available-for-sale Securities [Line Item] | ||
Cost | 1,307.3 | 842.5 |
Fair Value | 1,307.3 | 842.5 |
Cash and Cash Equivalents | 809.4 | 380.1 |
Short Term Investments | 474.8 | 458.1 |
Other Assets | 23.1 | 4.3 |
Fixed Maturity and Mutual Funds [Member] | ||
Schedule of Available-for-sale Securities [Line Item] | ||
Cost | 28.7 | 47.1 |
Gross Unrealized Gain | 3.2 | 0.9 |
Fair Value | 31.9 | 48 |
Other Assets | $ 31.9 | $ 48 |
Cash Equivalent and Investmen21
Cash Equivalent and Investments (Parenthetical) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Minimum [Member] | Certificates of Deposit [Member] | Short Term Investments [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 1 month | 1 month |
Minimum [Member] | Certificates of Deposit [Member] | Other Assets [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 1 month | 1 month |
Minimum [Member] | Fixed Maturity and Mutual Funds [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 11 months | 2 months |
Maximum [Member] | Major Types of Debt Securities [Domain] | Cash and Cash Equivalents [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 90 days | |
Maximum [Member] | Certificates of Deposit [Member] | Short Term Investments [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 12 months | 10 months |
Maximum [Member] | Certificates of Deposit [Member] | Other Assets [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 27 months | 39 months |
Maximum [Member] | Fixed Maturity and Mutual Funds [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities maturity period | 31 months | 23 months |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended |
Dec. 31, 2015 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | NOTE 5 DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The Company is exposed to global market risks, including risks from changes in FX rates and changes in interest rates. Accordingly, the Company uses derivatives in certain instances to manage the aforementioned financial exposures that occur in the normal course of business. The Company does not hold or issue derivatives for speculative purposes. Derivatives and non-derivative instruments designated as accounting hedges: Interest Rate Swaps In the second quarter of 2014, the Company entered into interest rate swaps with a total notional amount of $ 250 million to convert the fixed interest rate on the 2010 Senior Notes to a floating interest rate based on the 3-month LIBOR. In the third quarter of 20 14, the Company entered into interest rate swaps with a total notional amount of $250 million to convert the fixed interest rate on the remaining balance of the 2010 Senior Notes to a floating interest rate based on the 3-month LIBOR. The purpose of these hedges is to mitigate the risk associated with changes in the fair value of the 2010 Senior Notes, thus the Company has designated these swaps as fair value hedges. The fair value of the swaps is adjusted quarterly with a corresponding adjustment to the ca rrying value of the 2010 Senior Notes. The changes in the fair value of the hedges and the underlying hedged item generally offset and the net cash settlements on the swaps are recorded each period within interest expense, net in the Company’s consolidate d statement of operations. In the third quarter of 2014, the Company entered into interest rate swaps with a total notional amount of $ 250 million to convert the fixed interest rate on a portion of the 2014 Senior Notes (5-year) to a floating interest rate based on the 3-month LIBOR . In the first quarter of 2015, the Company entered into interest rate swaps with a total notional amount of $ 200 million to convert the fixed interest rate on the remaining balance of the 2014 Senior Notes (5-year) to a floating interest rate based on the 3-month LIBOR. The purpose of these hedges is to mitigate the risk associated with changes in the fair value of the 2014 Senior Notes (5-year), thus the Company has designated these swaps as fair value hedges. The fair value of the swaps is adjusted quarterly with a corresponding adjustment to the carrying value of the 2014 Senior Notes (5-year). The changes in the fair value of the hedges and the underlying hedged item generally offset and the net cash settlements on the swaps a re recorded each period within interest expense, net in the Company’s consolidated statement of operations. The following table summarizes the impact to the statement of operations of the Company’s interest rate swaps designated as fair value hedges: Amount of Income Recognized in the consolidated statements of operations Year Ended December 31, 2015 2014 2013 Derivatives designated as Fair Value accounting hedges Location on Consolidated Statement of Operations Interest rate swaps Interest expense, net $ 15.2 $ 11.7 $ 4.2 In November 2015, the Company entered into and settled a $ 150 million treasury rate lock agreement to manage the Company’s interest rate risk associated with the anticipated additional issuance of the 2014 Senior Notes (30-year) as further described in Note 15. The Company settled this rate lock for a loss of $ 1.1 million simultaneous with the additional issuance under the 2014 Senior Notes (30-Year). The loss on this rate lock was recorded in other comprehensive income and wil l be amortized to interest expense over the term of the 2014 Senior Notes (30-Year). Net Investment Hedges The Company enters into foreign currency forward contracts that are designated as net investment hedges and additionally has designated € 400 million of the 2015 Senior Notes as a net investment hedge. These hedges are intended to mitigate FX exposure related to non-U.S. dollar net investments in certain foreign subsidiaries against changes in foreign exchange rates. These net investment hedge s are designated as accounting hedges under the applicable sections of Topic 815 of the ASC. Hedge effectiveness is assessed based on the overall changes in the fair value of the hedge. For hedges that meet the effectiveness requirements, any change in th e fair value and any realized gains and losses for the hedge are recorded in AOCI in the foreign currency translation account. Any change in the fair value of these hedges that is the result of ineffectiveness is recognized immediately in other non-operati ng income , net in the Company’s consolidated statement of operations. The following table summarizes the notional amounts of the Company’s outstanding net investment hedges: December 31, December 31, 2015 2014 Notional amount of net investment hedges: Long-term debt designated as net investment hedge € 400.0 € - Contracts to sell euros for USD € - € 50.0 Contracts to sell GBP for euros £ 21.2 £ - Contracts to sell Japanese yen for USD ¥ 19,400.0 ¥ 19,400.0 The outstanding contracts to sell Japanese yen for USD mature in November 201 6 . The outstanding contrac ts to sell GBP for euros mature in March 2016 . The hedge relating to the portion of the 2015 Senior Notes that was designated as a net investment hedge will end upon the repayment of the notes in 2027 unless terminated earlier at the discretion of the Company. The following table provides information on the gains/(losses) on the Company’s net investment and cash flow hedges: Amount of Gain (Loss) Recognized in AOCI on Derivative (Effective Portion), net of tax Derivatives and non-derivatives in net investment hedging relationships Year Ended December 31, 2015 2014 2013 FX forwards $ 13.4 19.4 3.7 Long-term debt 4.7 - - Total $ 18.1 19.4 3.7 Amount of Gain (Loss) Recognized in AOCI on Derivative (Effective Portion), net of tax Derivatives in cash flow hedging relationships Year Ended December 31, 2015 2014 2013 Treasury rate lock $ (1.1) - - $ (1.1) - - The loss on this rate lock will be amortized over the term of the 2014 Senior Notes (30-year) . The amount that will be reclassified to earnings in 2016 is immaterial. The cumulative amount of realized and unrecognized net investment and cash flow hedge gains /(losses) recorded in AOCI is as follows: Gains (Losses), net of tax December 31, December 31, 2015 2014 Net investment hedges FX forwards $ 34.3 $ 20.9 Long-term debt 4.7 - Total net investment hedges $ 39.0 $ 20.9 Cash flow hedges Treasury rate lock (1.1) - Total $ 37.9 20.9 Derivatives not designated as accounting hedges: Foreign exchange forwards The Company also enters into foreign exchange forwards to mitigate the change in fair value on certain assets and liabilities denominated in currencies other than a subsidiary’s functional currency. These forward contracts are not designated as accounting hedges under the applicable sections of Topic 815 of the ASC. Accordingly, changes in the fair value of these contracts are recognized immediately in other non-operating (expense) income, net in the Company’s consolidated statements of operations along wit h the FX gain or loss recognized on the assets and liabilities denominated in a currency other than the subsidiary’s functional currency. These contracts have expiration dates at various times through March 2016 . The following table summarizes the notion al amounts of the Company’s outstanding foreign exchange forwards: December 31, December 31, 2015 2014 Notional amount of currency pair: Contracts to purchase USD with euros $ - $ 38.5 Contracts to sell USD for euros $ 70.1 $ 51.1 Contracts to purchase USD with GBP $ - $ 0.2 Contracts to purchase USD with other foreign currencies $ - $ 1.2 Contracts to purchase euros with other foreign currencies € 35.5 € 34.0 Contracts to sell euros for other foreign currencies € 1.4 € - Contracts to purchase euros with GBP € - € 25.0 Contracts to sell euros for GBP € 23.1 € 38.2 Cross-currency swaps In conjunction with the issuance of the 2015 Senior Notes, the Company entered into a cross-currency swap to exchange € 100 million for U.S. dollars on the date of the settlement of the notes. The purpose of this cross-currency swap is to mitigate FX risk on the remaining principal balance on the 2015 Senior Notes that was not designated as a net investment hedge as more fully discussed above. The Company has not designated these cross-currency swaps as accounting hedges. According ly, changes in fair value on these swaps is recognized immediately in other non-operating (expense), income, net in the Company’s consolidated statements of operations along with the FX gain or loss recognized on the €100 million principal of the 2015 Seni or Notes that was not designated as a net investment hedge. Under the terms of the swap, the Company will pay the counterparty interest on the $ 110.5 million received at 3.945 % per annum and the counterparty will pay the Company interest on the € 100 millio n paid at 1.75 % per annum. These interest payments will be settled in March of each year, beginning in 2016, until either the maturity of the cross-currency swap in 2027 or upon early termination at the discretion of the Company. The principal payments o n this cross currency swap will be settled in 2027, concurrent with the repayment of the 2015 Senior Notes at maturity or upon early termination at the discretion of the Company. The following table summarizes the impact to the consolidated statements of operations relating to the net gain on the Company’s derivatives which are not designated as hedging instruments: Year Ended December 31, Derivatives not designated as accounting hedges Location on Statement of Operations 2015 2014 2013 Cross-currency swap Other non-operating income, net $ (9.0) $ - $ - Foreign exchange forwards Other non-operating income, net (2.8) (2.0) (2.1) Total $ (11.8) $ (2.0) $ (2.1) The table below shows the classification between assets and liabilities on the Company’s consolidated balance sheets for the fair value of the derivative instrument as well as the carrying value of its nonderivative debt instruments designated and qualifying as net investment hedges: Derivative and Non-derivative Instruments Balance Sheet Location December 31, 2015 December 31, 2014 Assets: Derivatives designated as accounting hedges: FX forwards on net investment in certain foreign subsidiaries Other current assets $ 0.4 $ 18.8 Interest rate swaps Other assets 12.1 17.4 Total derivatives designated as accounting hedges 12.5 36.2 Derivatives not designated as accounting hedges: FX forwards on certain assets and liabilities Other current assets 0.1 5.6 Total assets $ 12.6 $ 41.8 Liabilities: Derivatives designated as accounting hedge: FX forwards on net investment in certain foreign subsidiaries Accounts payable and accrued liabilities $ 1.2 $ - Interest rate swaps Other non-current liabilities 0.3 - Total derivatives designated as accounting hedges 1.5 - Non-derivative instrument designated as accounting hedge: Long-term debt designated as net investment hedge Long-term debt 434.5 - Derivatives not designated as accounting hedges: Cross-currency swap Other non-current liabilities 9.0 - FX forwards on certain assets and liabilities Accounts payable and accrued liabilities 1.9 2.1 Total liabilities $ 446.9 $ 2.1 |
DERIVATIVE INSTRUMENTS AND HE23
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Gains and Losses on Derivatives Designated as Hedging Instruments | Amount of Income Recognized in the consolidated statements of operations Year Ended December 31, 2015 2014 2013 Derivatives designated as Fair Value accounting hedges Location on Consolidated Statement of Operations Interest rate swaps Interest expense, net $ 15.2 $ 11.7 $ 4.2 |
Amount of Gain/(Loss) Recognized in AOCI on Derivative Net Investment Hedging Relationships (Effectiveness Portion) | Amount of Gain (Loss) Recognized in AOCI on Derivative (Effective Portion), net of tax Derivatives and non-derivatives in net investment hedging relationships Year Ended December 31, 2015 2014 2013 FX forwards $ 13.4 19.4 3.7 Long-term debt 4.7 - - Total $ 18.1 19.4 3.7 Amount of Gain (Loss) Recognized in AOCI on Derivative (Effective Portion), net of tax Derivatives in cash flow hedging relationships Year Ended December 31, 2015 2014 2013 Treasury rate lock $ (1.1) - - $ (1.1) - - |
Cumulative Amount of Unrecognized Hedge Losses Recorded in Accumulated Other Comprehensive Income | Gains (Losses), net of tax December 31, December 31, 2015 2014 Net investment hedges FX forwards $ 34.3 $ 20.9 Long-term debt 4.7 - Total net investment hedges $ 39.0 $ 20.9 Cash flow hedges Treasury rate lock (1.1) - Total $ 37.9 20.9 |
Gains and Losses Recognized in Consolidated Statement of Operations on Derivatives Not Designated as Hedging Instruments | Year Ended December 31, Derivatives not designated as accounting hedges Location on Statement of Operations 2015 2014 2013 Cross-currency swap Other non-operating income, net $ (9.0) $ - $ - Foreign exchange forwards Other non-operating income, net (2.8) (2.0) (2.1) Total $ (11.8) $ (2.0) $ (2.1) |
Fair Value of Derivative Instruments | Derivative and Non-derivative Instruments Balance Sheet Location December 31, 2015 December 31, 2014 Assets: Derivatives designated as accounting hedges: FX forwards on net investment in certain foreign subsidiaries Other current assets $ 0.4 $ 18.8 Interest rate swaps Other assets 12.1 17.4 Total derivatives designated as accounting hedges 12.5 36.2 Derivatives not designated as accounting hedges: FX forwards on certain assets and liabilities Other current assets 0.1 5.6 Total assets $ 12.6 $ 41.8 Liabilities: Derivatives designated as accounting hedge: FX forwards on net investment in certain foreign subsidiaries Accounts payable and accrued liabilities $ 1.2 $ - Interest rate swaps Other non-current liabilities 0.3 - Total derivatives designated as accounting hedges 1.5 - Non-derivative instrument designated as accounting hedge: Long-term debt designated as net investment hedge Long-term debt 434.5 - Derivatives not designated as accounting hedges: Cross-currency swap Other non-current liabilities 9.0 - FX forwards on certain assets and liabilities Accounts payable and accrued liabilities 1.9 2.1 Total liabilities $ 446.9 $ 2.1 |
Net Investment Hedging [Member] | |
Summary of Notional Amounts of Outstanding Derivative Positions | December 31, December 31, 2015 2014 Notional amount of net investment hedges: Long-term debt designated as net investment hedge € 400.0 € - Contracts to sell euros for USD € - € 50.0 Contracts to sell GBP for euros £ 21.2 £ - Contracts to sell Japanese yen for USD ¥ 19,400.0 ¥ 19,400.0 |
Foreign Exchange Forwards [Member] | |
Summary of Notional Amounts of Outstanding Derivative Positions | December 31, December 31, 2015 2014 Notional amount of currency pair: Contracts to purchase USD with euros $ - $ 38.5 Contracts to sell USD for euros $ 70.1 $ 51.1 Contracts to purchase USD with GBP $ - $ 0.2 Contracts to purchase USD with other foreign currencies $ - $ 1.2 Contracts to purchase euros with other foreign currencies € 35.5 € 34.0 Contracts to sell euros for other foreign currencies € 1.4 € - Contracts to purchase euros with GBP € - € 25.0 Contracts to sell euros for GBP € 23.1 € 38.2 |
Summary of Net Gain (Loss) on F
Summary of Net Gain (Loss) on Foreign Exchange Forwards Not Designated as Hedging Instruments and on Interest Rate Swaps Designated as Fair Value Hedges (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Derivatives Designated as Accounting Hedges [Member] | Interest Rate Swap [Member] | Interest Income (Expense), Net [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain (loss) recognized in income | $ 15.2 | $ 11.7 | $ 4.2 |
Derivatives Not Designated as Accounting Hedges [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain (loss) recognized in income | (11.8) | (2) | |
Derivatives Not Designated as Accounting Hedges [Member] | Foreign Exchange Forwards [Member] | Other Nonoperating Income [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain (loss) recognized in income | (2.8) | $ (2) | $ (2.1) |
Derivatives Not Designated as Accounting Hedges [Member] | Cross-Currency Swap [Member] | Other Nonoperating Income [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain (loss) recognized in income | $ (9) |
Summary of Notional Amounts of
Summary of Notional Amounts of Outstanding Foreign Exchange Forward Contracts, Designated as Net Investment Hedges (Detail) - Net Investment Hedging [Member] € in Millions, ¥ in Millions, £ in Millions | Dec. 31, 2015EUR (€) | Dec. 31, 2015GBP (£) | Dec. 31, 2015JPY (¥) | Dec. 31, 2014EUR (€) | Dec. 31, 2014JPY (¥) |
Long-Term Debt [Member] | |||||
Derivative [Line Items] | |||||
Derivative Notional Amount | € 400 | ||||
Contracts to Sell Euros for USD [Member] | |||||
Derivative [Line Items] | |||||
Derivative Notional Amount | € 50 | ||||
Contracts to Sell GBP for Euros [Member] | |||||
Derivative [Line Items] | |||||
Derivative Notional Amount | £ | £ 21.2 | ||||
Contracts to Sell Japanese Yen for USD [Member] | |||||
Derivative [Line Items] | |||||
Derivative Notional Amount | ¥ | ¥ 19,400 | ¥ 19,400 |
Gains and Losses on Derivatives
Gains and Losses on Derivatives Designated as Hedging Instruments (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net Investment Hedging [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain/(loss) recognized in AOCI on derivative (effective portion) | $ 18.1 | $ 19.4 | $ 3.7 |
Net Investment Hedging [Member] | Foreign Exchange Forwards [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain/(loss) recognized in AOCI on derivative (effective portion) | 13.4 | $ 19.4 | $ 3.7 |
Net Investment Hedging [Member] | Long-Term Debt [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain/(loss) recognized in AOCI on derivative (effective portion) | 4.7 | ||
Cash Flow Hedging [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain/(loss) recognized in AOCI on derivative (effective portion) | (1.1) | ||
Cash Flow Hedging [Member] | Treasury Rate Lock [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amount of gain/(loss) recognized in AOCI on derivative (effective portion) | $ (1.1) |
Cumulative Amount of Unrecogniz
Cumulative Amount of Unrecognized Hedge Losses Recorded in Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Derivative Instruments Gain Loss [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | $ 37.9 | $ 20.9 |
Net Investment Hedging [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 39 | 20.9 |
Net Investment Hedging [Member] | Foreign Exchange Contract [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 34.3 | $ 20.9 |
Net Investment Hedging [Member] | Long-Term Debt [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 4.7 | |
Cash Flow Hedging [Member] | Treasury Rate Lock [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | $ (1.1) |
Summary of Notional Amounts o28
Summary of Notional Amounts of Outstanding Foreign Exchange Forwards (Detail) € in Millions, $ in Millions | Dec. 31, 2015EUR (€) | Dec. 31, 2015USD ($) | Dec. 31, 2014EUR (€) | Dec. 31, 2014USD ($) |
Contracts to Purchase USD with Euros [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | $ | $ 38.5 | |||
Contracts to Sell USD for Euros [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | $ | $ 70.1 | 51.1 | ||
Contracts to Purchase USD with GBP [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | $ | 0.2 | |||
Contracts to Purchase USD with Other Foreign Currencies [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | $ | $ 1.2 | |||
Contracts to Purchase Euros with Other Foreign Currencies [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | € | € 35.5 | € 34 | ||
Contracts to Sell Euros for Other Foreign Currencies [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | € | 1.4 | |||
Contracts to Purchase Euros with GBP [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | € | 25 | |||
Contracts to Sell Euros for GBP [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | € | € 23.1 | € 38.2 |
Fair Value of Derivative Instru
Fair Value of Derivative Instruments (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Derivatives Fair Value [Line Items] | ||
Derivatives assets | $ 12.6 | $ 41.8 |
Derivatives liabilities | 444.8 | 2.1 |
Derivatives Designated as Accounting Hedges [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 12.5 | 36.2 |
Derivatives liabilities | 1.5 | |
Derivatives Designated as Accounting Hedges [Member] | Interest Rate Swap [Member] | Other Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 12.1 | 17.4 |
Derivatives Designated as Accounting Hedges [Member] | Interest Rate Swap [Member] | Other Noncurrent Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 0.3 | |
Derivatives Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Other Current Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 18.8 | |
Derivatives Not Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Other Current Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 0.1 | 5.6 |
Derivatives Not Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Accounts Payable and Accrued Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 1.9 | $ 2.1 |
Derivatives Not Designated as Accounting Hedges [Member] | Cross-Currency Swap [Member] | Other Noncurrent Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 9 | |
Net Investment Hedging [Member] | Derivatives Designated as Accounting Hedges [Member] | Long-Term Debt [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 434.5 | |
Net Investment Hedging [Member] | Derivatives Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Other Current Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 0.4 | |
Net Investment Hedging [Member] | Derivatives Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Accounts Payable and Accrued Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | $ 1.2 |
Derivative Instruments and He30
Derivative Instruments and Hedging Activities - Additional Information (Detail) € in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2015USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Sep. 30, 2014USD ($) | |
2010 Senior Notes [Member] | Interest Rate Swap [Member] | |||||
Derivative [Line Items] | |||||
Notional amount | $ 250 | ||||
2014 Senior Notes (5-Year) [Member] | Interest Rate Swap [Member] | |||||
Derivative [Line Items] | |||||
Notional amount | $ 200 | ||||
2015 Senior Notes [Member] | Cross-Currency Swap [Member] | Derivatives Not Designated as Investment Hedges [Member] | |||||
Derivative [Line Items] | |||||
Notional amount | € | € 100 | ||||
2015 Senior Notes [Member] | Cross-Currency Swap [Member] | Currency Paid [Member] | Derivatives Not Designated as Investment Hedges [Member] | |||||
Derivative [Line Items] | |||||
Derivative, swaption interest rate | 1.75% | 1.75% | |||
2015 Senior Notes [Member] | Cross-Currency Swap [Member] | Currency Received [Member] | Derivatives Not Designated as Investment Hedges [Member] | |||||
Derivative [Line Items] | |||||
Gain due to termination of Interest rate swap | $ 110.5 | ||||
Derivative, swaption interest rate | 3.945% | 3.945% | |||
2014 Senior Notes (30-Year) [Member] | Treasury Rate Lock [Member] | |||||
Derivative [Line Items] | |||||
Notional amount | $ 150 | ||||
Gain due to termination of Interest rate swap | $ 1.1 | ||||
Net Investment Hedging [Member] | 2015 Senior Notes [Member] | Derivatives Designated as Accounting Hedges [Member] | |||||
Derivative [Line Items] | |||||
Notional amount | € | € 400 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2015 | |
PROPERTY AND EQUIPMENT, NET | NOTE 6 PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of: December 31, 2015 2014 Office and computer equipment (3 - 10 year estimated useful life) $ 172.1 $ 152.5 Office furniture and fixtures (3 - 10 year estimated useful life) 45.4 43.8 Internal-use computer software (1 - 10 year estimated useful life) 387.0 336.8 Leasehold improvements and building (3 - 20 year estimated useful life) 220.8 220.7 Total property and equipment, at cost 825.3 753.8 Less: accumulated depreciation and amortization (518.9) (451.5) Total property and equipment, net $ 306.4 $ 302.3 Depreciation and amortization expense related to the above assets was $ 81.6 million, $67.2 million, and $65.4 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment, Net | December 31, 2015 2014 Office and computer equipment (3 - 10 year estimated useful life) $ 172.1 $ 152.5 Office furniture and fixtures (3 - 10 year estimated useful life) 45.4 43.8 Internal-use computer software (1 - 10 year estimated useful life) 387.0 336.8 Leasehold improvements and building (3 - 20 year estimated useful life) 220.8 220.7 Total property and equipment, at cost 825.3 753.8 Less: accumulated depreciation and amortization (518.9) (451.5) Total property and equipment, net $ 306.4 $ 302.3 |
Property and Equipment, Net (De
Property and Equipment, Net (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Property Plant And Equipment [Line Items] | ||
Office and computer equipment (3 - 10 year estimated useful life) | $ 172.1 | $ 152.5 |
Office furniture and fixtures (3 - 10 year estimated useful life) | 45.4 | 43.8 |
Internal-use computer software (3 - 10 year estimated useful life) | 387 | 336.8 |
Leasehold improvements (3 - 20 year estimated useful life) | 220.8 | 220.7 |
Total property and equipment, at cost | 825.3 | 753.8 |
Less: accumulated depreciation and amortization | (518.9) | (451.5) |
Total property and equipment, net | $ 306.4 | $ 302.3 |
Property and Equipment, Net (Pa
Property and Equipment, Net (Parenthetical) (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Office and Computer Equipment [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 3 years |
Office and Computer Equipment [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 10 years |
Office Furniture and Fixtures [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 3 years |
Office Furniture and Fixtures [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 10 years |
Internal-use Computer Software [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 1 year |
Internal-use Computer Software [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 10 years |
Leasehold Improvements and Building [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 3 years |
Leasehold Improvements and Building [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property plant and equipment useful life | 20 years |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property Plant And Equipment Disclosure [Line Items] | |||
Depreciation and amortization expense related to property and equipment | $ 81.6 | $ 67.2 | $ 65.4 |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2015 | |
ACQUISITIONS | NOTE 7 ACQUISITIONS The business combinations described below are accounted for using the acquisition method of accounting whereby assets acquired and liabilities assumed were recognized at fair value on the date of the transaction. Any excess of the purchase price over the fair value of the assets acquired and liabilities assumed was recorded to goodwill. The Company has not presented proforma combined results because the impact on previously reported statements of operations would not have been material. These acquisitions are discussed below in more detail BlackBox Logic On December 9, 2015, a subsidiary of the Company acquired the RMBS data and analytics business of BlackBox Logic. The aggregate purchase price was not material and the near term impact to the Company’s operations and cash flows is not expected to be material. This business operates in the MA reportable segment and goodwill related to this acquisition has been allocated to the RD&A reporting unit. Equilibrium On May 21, 2015 , a subsidiary of the Company acquired 100 % of Equilibrium , a provider of credit rating and research services in Peru and Panama. The aggregate purchase price was not material and the near term impact to the Company’s operations and cash flows is not expect ed to be material. Equilibrium operates in the MIS reportable segment and goodwill related to this acquisition has been alloca ted to the MIS reporting unit. Lewtan Technologies On October 27, 2014, a subsidiary of the Company acquired 100 % of Lewtan Technologies, a leading provider of analytical tools and data for the global structured finance market. The acquisition of Lewtan will bolster MA’s Structured Analytics and Valuations (SAV) business within its RD&A LOB, which provides an extensive data and analytics library for securitized assets. The aggregate purchase price is not material. Lewtan operates in the RD&A LOB of MA and goodwill related to this acquisition was allocated to the RD&A reporting unit. WebEquity Solutions, LLC On July 17, 2014, a subsidiary of the Company acquired 100 % of WebEquity Solutions, LLC, a leading provider of cloud-based loan origination solutions for financial institutions. The payment of $ 130.5 million was funded with cash on hand . This acquisition will enhance MA’s risk management product portfolio. Shown below is the purchase price allocation, which summarizes the fair value of the assets and liabilities assumed, at the date of the acquisition: Current assets $ 3.0 Property and equipment, net 2.3 Intangible assets: Client relationships (18 year weighted average life) $ 42.8 Software (15 year weighted average life) 11.5 Trade name (4 year weighted average life) 0.5 Total intangible assets (17 year weighted average life) 54.8 Goodwill 77.6 Liabilities assumed (7.2) Net assets acquired $ 130.5 The acquired goodwill, which has been assigned to the MA segment, will be deductible for tax. As of the date of the acquisition, WebEquity is part of the ERS reporting unit. ICRA Limited On June 26, 2014, a subsidiary of the Company acquired 2,154,722 additional shares of ICRA Limited, a publicly traded company in India. ICRA is a leading provider of credit ratings and research in India and will extend MIS’s reach in the growing domestic debt market in India as well as other emerging markets in the region. The acquisition of the additional shares increased Moody’s ownership stake in ICRA from 28.5 % to just over 50 %, resulting in a controlling interest in ICRA. Moody’s consolidates ICRA’s financial statements on a three- month lag. Prior to the acquisition of the additional shares, Moody’s accounted for its investment in ICRA on an equity basis whereby the Company recorded its proportional share of the inves tment’s net income or loss as part of other non-operating income (expense), net. The acquisition of the additional shares has resulted in the Company consolidating ICRA into its financial statements. As a result of this consolidation and in accordance wi th ASC 805, the carrying value of the Company’s equity investment in ICRA was remeasured to fair value as of the acquisition date resulting in a pre-tax gain of $ 102.8 million ($ 78.5 million after-tax) in the second quarter of 2014. The fair value of the Company’s equity invest ment was based on ICRA’s quoted market price on the date of acquisition. The table below details the total consideration relating to the ICRA step-acquisition: Cash paid $ 86.0 Fair value of equity interest in ICRA prior to obtaining a controlling interest 124.9 Total consideration $ 210.9 The cash paid in the table above was funded above using Moody's non-U.S. cash on hand. Shown below is the purchase price allocation, which summarizes the fair value of the assets and liabilities assumed, at the date of acquisition: Current assets $ 25.4 Property and equipment, net 15.1 Intangible assets: Trade name (36 year weighted average life) $ 46.8 Client relationships (19 year weighted average life) 33.8 Other (17 year weighted average life)* 18.3 Total intangible assets (26 year weighted average life) 98.9 Goodwill 296.7 Other assets 56.3 Liabilities (62.7) Fair value of non-controlling interest assumed (218.8) Net assets acquired $ 210.9 * Primarily consists of acquired technical know-how and ratings methodologies Current assets include acquired cash of approximately $ 5 million. Additionally, current assets includes gross accounts receivable of approximately $ 14 million, of which an immaterial amount is not expected to be collectible. Goodwill, which has been assigned to the MIS segment, is not deductible for tax. The fair value of the non-controlling interest was determined based on the quoted market price per share of ICRA on the date that the Company acquired the controlling stake. ICRA op erates as its own reporting unit for purposes of the Company’s annual goodwill impairment assessment. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Web Equity Solutions [Member] | |
Summary of Fair Values of Assets Acquired and Liabilities Assumed | Current assets $ 3.0 Property and equipment, net 2.3 Intangible assets: Client relationships (18 year weighted average life) $ 42.8 Software (15 year weighted average life) 11.5 Trade name (4 year weighted average life) 0.5 Total intangible assets (17 year weighted average life) 54.8 Goodwill 77.6 Liabilities assumed (7.2) Net assets acquired $ 130.5 |
ICRA [Member] | |
Summary of Fair Values of Assets Acquired and Liabilities Assumed | Current assets $ 25.4 Property and equipment, net 15.1 Intangible assets: Trade name (36 year weighted average life) $ 46.8 Client relationships (19 year weighted average life) 33.8 Other (17 year weighted average life)* 18.3 Total intangible assets (26 year weighted average life) 98.9 Goodwill 296.7 Other assets 56.3 Liabilities (62.7) Fair value of non-controlling interest assumed (218.8) Net assets acquired $ 210.9 * Primarily consists of acquired technical know-how and ratings methodologies |
Consideration to The Step Acquisition | Cash paid $ 86.0 Fair value of equity interest in ICRA prior to obtaining a controlling interest 124.9 Total consideration $ 210.9 The cash paid in the table above was funded above using Moody's non-U.S. cash on hand. |
Purchase Price Allocation (Deta
Purchase Price Allocation (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Jul. 17, 2014 | Jun. 26, 2014 | Dec. 31, 2013 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 976.3 | $ 1,021.1 | $ 665.2 | ||
Fair value of non-controlling interest assumed | $ (218.8) | ||||
Web Equity Solutions [Member] | |||||
Business Acquisition [Line Items] | |||||
Current assets | $ 3 | ||||
Property and equipment, net | 2.3 | ||||
Total intangible assets | 54.8 | ||||
Goodwill | 77.6 | ||||
Liabilities assumed | (7.2) | ||||
Net assets acquired | 130.5 | ||||
Web Equity Solutions [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Total intangible assets | 0.5 | ||||
Web Equity Solutions [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Total intangible assets | 42.8 | ||||
Web Equity Solutions [Member] | Software [Member] | |||||
Business Acquisition [Line Items] | |||||
Total intangible assets | $ 11.5 | ||||
ICRA [Member] | |||||
Business Acquisition [Line Items] | |||||
Current assets | $ 25.4 | ||||
Property and equipment, net | 15.1 | ||||
Total intangible assets | 98.9 | ||||
Goodwill | 296.7 | ||||
Other assets | 56.3 | ||||
Liabilities assumed | (62.7) | ||||
Fair value of non-controlling interest assumed | (218.8) | ||||
Net assets acquired | 210.9 | ||||
ICRA [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Total intangible assets | 46.8 | ||||
ICRA [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Total intangible assets | 33.8 | ||||
ICRA [Member] | Other Intangibles [Member] | |||||
Business Acquisition [Line Items] | |||||
Total intangible assets | $ 18.3 |
Purchase Price Allocation (Pare
Purchase Price Allocation (Parenthetical) (Detail) | Jul. 16, 2014 | Jun. 26, 2014 |
Web Equity Solutions [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 17 years | |
Web Equity Solutions [Member] | Trade Names [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 4 years | |
Web Equity Solutions [Member] | Customer Relationships [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 18 years | |
Web Equity Solutions [Member] | Software [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 15 years | |
ICRA [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 26 years | |
ICRA [Member] | Trade Names [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 36 years | |
ICRA [Member] | Customer Relationships [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 19 years | |
ICRA [Member] | Other Intangibles [Member] | ||
Business Acquisition [Line Items] | ||
Weighted average life of intangible assets acquired (in years) | 17 years |
Total Consideration Transferred
Total Consideration Transferred to Sellers (Detail) - ICRA [Member] $ in Millions | Jun. 26, 2014USD ($) |
Business Acquisition [Line Items] | |
Cash paid | $ 86 |
Fair value of equity interest in ICRA prior to obtaining a controlling interest | 124.9 |
Total fair value of consideration transferred | $ 210.9 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) $ in Millions | Jul. 16, 2014 | Jun. 26, 2014 | Dec. 31, 2014 | May. 21, 2015 | Oct. 27, 2014 | Jul. 17, 2014 |
Business Acquisition [Line Items] | ||||||
Remeasurement gain on acquisition | $ 102.8 | |||||
Equilibrium [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition interests acquired | 100.00% | |||||
Lewtan [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition interests acquired | 100.00% | |||||
Web Equity Solutions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition interests acquired | 100.00% | |||||
Cash paid for business acquisition | $ 130.5 | |||||
ICRA [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid for business acquisition | $ 86 | |||||
Acquired cash included in current assets | 5 | |||||
Account receivables gross included in current assets | $ 14 | |||||
Additional offer shares acquired | 2,154,722 | |||||
Ownership percentage | 50.00% | |||||
Remeasurement gain on acquisition | $ 102.8 | |||||
After Tax [Member] | ICRA [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Remeasurement gain on acquisition | $ 78.5 |
GOODWILL AND OTHER ACQUIRED INT
GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2015 | |
GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS | NOTE 8 GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS The following table summarizes the activity in goodwill: Year Ended December 31, 2015 MIS MA Consolidated Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Balance at beginning of year $ 298.7 $ - $ 298.7 $ 734.6 $ (12.2) $ 722.4 $ 1,033.3 $ (12.2) $ 1,021.1 Additions/adjustments 3.7 - 3.7 5.0 - 5.0 8.7 - 8.7 Foreign currency translation adjustments (18.0) - (18.0) (35.5) - (35.5) (53.5) - (53.5) Ending balance $ 284.4 $ - $ 284.4 $ 704.1 $ (12.2) $ 691.9 $ 988.5 $ (12.2) $ 976.3 Year ended December 31, 2014 MIS MA Consolidated Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Balance at beginning of year $ 11.4 $ - $ 11.4 $ 666.0 $ (12.2) $ 653.8 $ 677.4 $ (12.2) $ 665.2 Additions/adjustments 296.7 - 296.7 101.1 - 101.1 397.8 - 397.8 Foreign currency translation adjustments (9.4) - (9.4) (32.5) - (32.5) (41.9) - (41.9) Ending balance $ 298.7 $ - $ 298.7 $ 734.6 $ (12.2) $ 722.4 $ 1,033.3 $ (12.2) $ 1,021.1 The 2015 additions/adjustments for the MIS segment in the table above relate to the acquisition of Equilibrium. The 2015 additions/adjustments for the MA segment primarily reflect an adjustment to an indemnification asset recognized a s part of the Copal acquisition, goodwill acquired from the acquisition of a business from BlackBox Logic and adjustments to deferred revenue balances and deferred tax assets recognized as part of the Lewtan acquisition. The 2014 additions/adjustments for the MIS segment in t he table above relate to the ICRA acquisition in the second quarter of 2014. The 2014 additions/adjustments for the MA segment relate to the acquisition WebEquity in the third quarter of 2014 and Lewtan in the fourth quarter of 2014 as well as adjustments for Amba which was acquired in the fourth quarter of 2013. The accumulated impairment charge in the table above reflects an impairment charge recognized in 2012 relating to the FSTC reporting unit within MA. This impairment charge reflected a contraction in spending for training and certification services for many individuals and global financial institutions in 2012 due to macroeconomic uncertainties at the time. The fair value of the FSTC reporting unit utilized in this impairment assessment was estimat ed using a discounted cash flow methodology and comparable public company and precedent transaction multiples. Acquired i ntangible assets consisted of: December 31, 2015 2014 Customer relationships $ 298.4 $ 310.4 Accumulated amortization (110.0) (98.1) Net customer relationships 188.4 212.3 Trade secrets 29.7 30.6 Accumulated amortization (23.1) (20.9) Net trade secrets 6.6 9.7 Software 74.7 79.8 Accumulated amortization (47.7) (43.0) Net software 27.0 36.8 Trade names 72.4 76.5 Accumulated amortization (16.2) (13.3) Net trade names 56.2 63.2 Other 44.3 44.8 Accumulated amortization (23.4) (21.3) Net other 20.9 23.5 Total $ 299.1 $ 345.5 Other intangible assets primarily c onsist of databases, covenants not to compete and acquired ratings methodologies and models . Amortization expense relating to intangible assets is as follows: Year Ended December 31, 2015 2014 2013 Amortization expense 31.9 $ 28.4 $ 28.0 Estimated future annual amortization expense for intangible assets subject to amortization is as follows: Year Ending December 31, 2016 $ 31.3 2017 28.9 2018 22.5 2019 19.2 2020 18.6 Thereafter 178.6 Total estimated future amortization $ 299.1 Amortizable intangible assets are reviewed for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For all intangible assets, there were no such events or changes during 2015, 201 4 or 2013 that would indicate that the carrying amount of amortizable intangible assets in any of the Company’s reporting units may not be recoverable. Additionally, there were no eve nts or circumstances during 2015, 2014 or 2013 that would indicate the need for an adjustment of the remaining useful lives of these amortizable intangible assets. |
GOODWILL AND OTHER ACQUIRED I43
GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Activity in Goodwill | Year Ended December 31, 2015 MIS MA Consolidated Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Balance at beginning of year $ 298.7 $ - $ 298.7 $ 734.6 $ (12.2) $ 722.4 $ 1,033.3 $ (12.2) $ 1,021.1 Additions/adjustments 3.7 - 3.7 5.0 - 5.0 8.7 - 8.7 Foreign currency translation adjustments (18.0) - (18.0) (35.5) - (35.5) (53.5) - (53.5) Ending balance $ 284.4 $ - $ 284.4 $ 704.1 $ (12.2) $ 691.9 $ 988.5 $ (12.2) $ 976.3 Year ended December 31, 2014 MIS MA Consolidated Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Gross goodwill Accumulated impairment charge Net goodwill Balance at beginning of year $ 11.4 $ - $ 11.4 $ 666.0 $ (12.2) $ 653.8 $ 677.4 $ (12.2) $ 665.2 Additions/adjustments 296.7 - 296.7 101.1 - 101.1 397.8 - 397.8 Foreign currency translation adjustments (9.4) - (9.4) (32.5) - (32.5) (41.9) - (41.9) Ending balance $ 298.7 $ - $ 298.7 $ 734.6 $ (12.2) $ 722.4 $ 1,033.3 $ (12.2) $ 1,021.1 |
Acquired Intangible Assets | December 31, 2015 2014 Customer relationships $ 298.4 $ 310.4 Accumulated amortization (110.0) (98.1) Net customer relationships 188.4 212.3 Trade secrets 29.7 30.6 Accumulated amortization (23.1) (20.9) Net trade secrets 6.6 9.7 Software 74.7 79.8 Accumulated amortization (47.7) (43.0) Net software 27.0 36.8 Trade names 72.4 76.5 Accumulated amortization (16.2) (13.3) Net trade names 56.2 63.2 Other 44.3 44.8 Accumulated amortization (23.4) (21.3) Net other 20.9 23.5 Total $ 299.1 $ 345.5 |
Amortization Expense Relating to Acquired Intangible Assets | Year Ended December 31, 2015 2014 2013 Amortization expense 31.9 $ 28.4 $ 28.0 |
Estimated Future Amortization Expense for Acquired Intangible Assets Subject to Amortization | Year Ending December 31, 2016 $ 31.3 2017 28.9 2018 22.5 2019 19.2 2020 18.6 Thereafter 178.6 Total estimated future amortization $ 299.1 |
Activity in Goodwill (Detail)
Activity in Goodwill (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Goodwill [Line Items] | ||
Beginning balance, goodwill gross | $ 1,033.3 | $ 677.4 |
Additions/adjustments, gross | 8.7 | 397.8 |
Foreign currency translation adjustments, gross | (53.5) | (41.9) |
Ending balance, goodwill gross | 988.5 | 1,033.3 |
Beginning balance, Accumulated impairment charge | (12.2) | (12.2) |
Ending balance, Accumulated impairment charge | (12.2) | (12.2) |
Beginning balance, goodwill net | 1,021.1 | 665.2 |
Additions/adjustments | 8.7 | 397.8 |
FX translation | (53.5) | (41.9) |
Ending balance, goodwill net | 976.3 | 1,021.1 |
MIS [Member] | ||
Goodwill [Line Items] | ||
Beginning balance, goodwill gross | 298.7 | 11.4 |
Additions/adjustments, gross | 3.7 | 296.7 |
Foreign currency translation adjustments, gross | (18) | (9.4) |
Ending balance, goodwill gross | 284.4 | 298.7 |
Beginning balance, goodwill net | 298.7 | 11.4 |
Additions/adjustments | 3.7 | 296.7 |
FX translation | (18) | (9.4) |
Ending balance, goodwill net | 284.4 | 298.7 |
MA [Member] | ||
Goodwill [Line Items] | ||
Beginning balance, goodwill gross | 734.6 | 666 |
Additions/adjustments, gross | 5 | 101.1 |
Foreign currency translation adjustments, gross | (35.5) | (32.5) |
Ending balance, goodwill gross | 704.1 | 734.6 |
Beginning balance, Accumulated impairment charge | (12.2) | (12.2) |
Ending balance, Accumulated impairment charge | (12.2) | (12.2) |
Beginning balance, goodwill net | 722.4 | 653.8 |
Additions/adjustments | 5 | 101.1 |
FX translation | (35.5) | (32.5) |
Ending balance, goodwill net | $ 691.9 | $ 722.4 |
Acquired Intangible Assets and
Acquired Intangible Assets and Related Amortization (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, net | $ 299.1 | $ 345.5 |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 298.4 | 310.4 |
Accumulated amortization | (110) | (98.1) |
Acquired intangible assets, net | 188.4 | 212.3 |
Trade Secrets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 29.7 | 30.6 |
Accumulated amortization | (23.1) | (20.9) |
Acquired intangible assets, net | 6.6 | 9.7 |
Software [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 74.7 | 79.8 |
Accumulated amortization | (47.7) | (43) |
Acquired intangible assets, net | 27 | 36.8 |
Trade Names [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 72.4 | 76.5 |
Accumulated amortization | (16.2) | (13.3) |
Acquired intangible assets, net | 56.2 | 63.2 |
Other Intangible Assets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 44.3 | 44.8 |
Accumulated amortization | (23.4) | (21.3) |
Acquired intangible assets, net | $ 20.9 | $ 23.5 |
Amortization Expense Relating t
Amortization Expense Relating to Acquired Intangible Assets (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finite Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 31.9 | $ 28.4 | $ 28 |
Estimated Future Amortization E
Estimated Future Amortization Expense for Acquired Intangible Assets Subject to Amortization (Detail) $ in Millions | Dec. 31, 2015USD ($) |
Schedule Of Actual And Estimated Amortization Expense [Line Items] | |
2,016 | $ 31.3 |
2,017 | 28.9 |
2,018 | 22.5 |
2,019 | 19.2 |
2,020 | 18.6 |
Thereafter | 178.6 |
Total estimated future amortization | $ 299.1 |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2015 | |
FAIR VALUE | NOTE 9 FAIR VALUE The table below presents information about items, which are carried at fair value on a recurring basis at December 31, 2015 and 2014: Fair Value Measurement as of December 31, 2015 Description Balance Level 1 Level 2 Level 3 Assets: Derivatives (a) $ 12.6 $ - $ 12.6 $ - Money market mutual funds 188.3 188.3 - - Fixed maturity and open ended mutual funds (b) 31.9 31.9 - - Total $ 232.8 $ 220.2 $ 12.6 $ - Liabilities: Derivatives (a) $ 12.4 $ - $ 12.4 $ - Total $ 12.4 $ - $ 12.4 $ - Fair Value Measurement as of December 31, 2014 Description Balance Level 1 Level 2 Level 3 Assets: Derivatives (a) $ 41.8 $ - $ 41.8 $ - Money market mutual funds 149.7 149.7 - - Fixed maturity and open ended mutual funds (b) 48.0 48.0 - - Total $ 239.5 $ 197.7 $ 41.8 $ - Liabilities: Derivatives (a) $ 2.1 $ - $ 2.1 $ - Contingent consideration arising from acquisitions (c) 2.1 - - 2.1 Total $ 4.2 $ - $ 2.1 $ 2.1 (a) Represents FX forwards on certain assets and liabilities and on net investments in certain foreign subsidiaries as well as interest rate swaps and cross-currency swaps as more fully described in Note 5 to the financial statements. (b) Consists of investments in fixed maturity mutual funds and open-ended mutual funds. (c) Represents contingent consideration liabilities pursuant to the agreements for the CSI acquisition. The following table summarizes the changes in the fair value of the Company’s Level 3 liabilities: Changes in Contingent Consideration for Years Ended December 31, 2015 2014 2013 Balance as of January 1 $ 2.1 $ 17.5 $ 9.0 Contingent consideration assumed in acquisition of Amba - - 4.3 Contingent consideration payments (1.9) (16.5) (2.5) Losses included in earnings - 1.3 6.9 Foreign currency translation adjustments (0.2) (0.2) (0.2) Balance as of December 31 $ - $ 2.1 $ 17.5 The losses in 2014 and 2013 included in earnings in the table above were recorded within SG&A expenses in the Company’s consolidated statements of operations and related to contingent consideration obligations related to the Copal Amba acquisition which were settled in 2014. The following are descriptions of the methodologies utilized by the Company to estimate the fair value of its derivative contracts, fixed maturity plans, money market mutual funds, and contingent consideration obligations: Derivatives: In de termining the fair value of the derivative contracts in the table above, the Company utilizes industry standard valuation models. Where applicable, these models project future cash flows and discount the future amounts to a present value using spot rates, forward points, currency volatilities, interest rates as well as the risk of non-performance of the Company and the counterparties with whom it has deriv ative contracts. The Company established strict counterparty credit guidelines and only enters into tra nsactions with financial institutions that adhere to these guidelines. Accordingly, the risk of counterparty default is deemed to be minimal. Fixed maturity and open ended mutual funds: The fixed maturity mutual funds and open ended mutual funds primarily represent exchange traded funds in India and are classified as securities available-for-sale. Accordingly, any unrealized gains and losses are recognized through OCI until the instruments mature or are sold. Money market mutual funds: The money market mutual funds represent publicly traded funds with a stable $ 1 net asset value. Contingent C onsideration: During the third quarter of 2015, the Company settled a contingent consideration obligation of 2.5 million Canadian dollars related to the acquisition of CSI that was based on certain non-financial metrics set forth in the acquisition agreement. Prior to the settlement of this obligation, the Company utilized a discounted cash flow methodology to value this obligation. These obligations were measured us ing Level 3 inputs as defined in the ASC. For certain of the contingent consideration obligations relating to the acquisition of Copal, a portion of the contingent cash payments were based on revenue and EBITDA growth for certain of the Copal entities. This growth was calculated by comparing revenue and EBITDA in the year immediately prior to the exercise of the put/call option to acquire the remaining 33% ownership interest of Copal Partners Limited, to revenue and EBITDA in Copal’s fiscal year ended March 31, 2011. Payments of $ 12.2 million under this arrangement were made in the fourth quarter of 2014 pursuant to the Company exercising its call option to acquire the remaining shares of Copal Amba. The Company had utilize d discounted cash flow methodologies to value these obligations prior to their settlement in 2014 . The expected future cash flows for these obligations were discounted using a risk-free interest rate plus a credit spread based on the option adjusted spread of the Com pany’s publicly traded debt as of the valuation date plus sovereign and size risk premiums. The most significant unobservable input involved in the mea surement of these obligations were the projected future financial results of the applicable Copal Amba e ntities. Other contingent cash payments were based on the achievement of revenue targets for Copal’s fiscal year ended March 31, 2013 and a $ 2.5 million payment was made in 2013. For the contingent consideration obligations relating to the acquisition of A mba, the payment was based on the acquired entity achieving a revenue target for its fiscal year ended March 31, 2014 which was met resulting in a $ 4.3 million payment in 2014 . |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments Carried at Fair Value on Recurring Basis | Fair Value Measurement as of December 31, 2015 Description Balance Level 1 Level 2 Level 3 Assets: Derivatives (a) $ 12.6 $ - $ 12.6 $ - Money market mutual funds 188.3 188.3 - - Fixed maturity and open ended mutual funds (b) 31.9 31.9 - - Total $ 232.8 $ 220.2 $ 12.6 $ - Liabilities: Derivatives (a) $ 12.4 $ - $ 12.4 $ - Total $ 12.4 $ - $ 12.4 $ - Fair Value Measurement as of December 31, 2014 Description Balance Level 1 Level 2 Level 3 Assets: Derivatives (a) $ 41.8 $ - $ 41.8 $ - Money market mutual funds 149.7 149.7 - - Fixed maturity and open ended mutual funds (b) 48.0 48.0 - - Total $ 239.5 $ 197.7 $ 41.8 $ - Liabilities: Derivatives (a) $ 2.1 $ - $ 2.1 $ - Contingent consideration arising from acquisitions (c) 2.1 - - 2.1 Total $ 4.2 $ - $ 2.1 $ 2.1 (a) Represents FX forwards on certain assets and liabilities and on net investments in certain foreign subsidiaries as well as interest rate swaps and cross-currency swaps as more fully described in Note 5 to the financial statements. (b) Consists of investments in fixed maturity mutual funds and open-ended mutual funds. (c) Represents contingent consideration liabilities pursuant to the agreements for the CSI acquisition. |
Changes in Fair Value of Level Three Liabilities | Changes in Contingent Consideration for Years Ended December 31, 2015 2014 2013 Balance as of January 1 $ 2.1 $ 17.5 $ 9.0 Contingent consideration assumed in acquisition of Amba - - 4.3 Contingent consideration payments (1.9) (16.5) (2.5) Losses included in earnings - 1.3 6.9 Foreign currency translation adjustments (0.2) (0.2) (0.2) Balance as of December 31 $ - $ 2.1 $ 17.5 |
Financial Instruments Carried a
Financial Instruments Carried at Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative contracts | $ 12.6 | $ 41.8 |
Money Market Funds at Carrying Value | 188.3 | 149.7 |
Fixed maturity and open ended mutual funds | 31.9 | 48 |
Total, assets | 232.8 | 239.5 |
Derivatives, liabilities | 12.4 | 2.1 |
Contingent consideration arising from acquisitions, payment or settlement | 2.1 | |
Total, liabilities | 12.4 | 4.2 |
Level 1 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Money Market Funds at Carrying Value | 188.3 | 149.7 |
Fixed maturity and open ended mutual funds | 31.9 | 48 |
Total, assets | 220.2 | 197.7 |
Level 2 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative contracts | 12.6 | 41.8 |
Total, assets | 12.6 | 41.8 |
Derivatives, liabilities | 12.4 | 2.1 |
Total, liabilities | $ 12.4 | 2.1 |
Level 3 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Contingent consideration arising from acquisitions, payment or settlement | 2.1 | |
Total, liabilities | $ 2.1 |
Changes in Fair Value of Level
Changes in Fair Value of Level Three Liabilities, Contingent Consideration (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Contingent consideration, beginning balance | $ 2.1 | $ 17.5 | $ 9 |
Contingent consideration, assumed in acquisition of Amba | 4.3 | ||
Contingent Consideration, payments | (1.9) | (16.5) | (2.5) |
Contingent Consideration, losses included in earnings | 1.3 | 6.9 | |
Contingent consideration, foreign currency translation adjustments | $ (0.2) | (0.2) | (0.2) |
Contingent consideration, ending balance | $ 2.1 | $ 17.5 |
Fair Value - Additional Informa
Fair Value - Additional Information (Detail) CAD in Millions | 3 Months Ended | |||
Dec. 31, 2014USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015CAD | Dec. 31, 2013USD ($) | |
Fair Value Of Financial Instruments [Line Items] | ||||
Net asset stable value for public traded funds | $ 1 | |||
Contingent consideration arising from acquisitions, payment or settlement | $ 2,100,000 | |||
Copal [Member] | ||||
Fair Value Of Financial Instruments [Line Items] | ||||
Contingent consideration arising from acquisitions, payment or settlement | 4,300,000 | $ 2,500,000 | ||
Payments to acquire remaining shares | $ 12,200,000 | |||
Remaining ownership interest | 33.00% | |||
CSI Global Education, Inc. [Member] | ||||
Fair Value Of Financial Instruments [Line Items] | ||||
Contingent consideration arising from acquisitions, payment or settlement | CAD | CAD 2.5 |
DETAIL OF CERTAIN BALANCE SHEET
DETAIL OF CERTAIN BALANCE SHEET INFORMATION | 12 Months Ended |
Dec. 31, 2015 | |
DETAIL OF CERTAIN BALANCE SHEET INFORMATION | NOTE 10 DETAIL OF CERTAIN BALANCE SHEET INFORMATION The following tables contain additional detail related to certain balance sheet captions: December 31, 2015 2014 Other current assets: Prepaid taxes $ 83.3 $ 65.4 Prepaid expenses 66.9 59.9 Other 29.4 47.2 Total other current assets $ 179.6 $ 172.5 December 31, 2015 2014 Other assets: Investments in joint ventures $ 28.7 $ 21.6 Deposits for real-estate leases 11.4 11.3 Indemnification assets related to acquisitions 19.2 23.5 Fixed maturity, open-ended mutual funds, and fixed deposits 55.0 48.0 Other 46.5 41.5 Total other assets $ 160.8 $ 145.9 December 31, 2015 2014 Accounts payable and accrued liabilities: Salaries and benefits $ 83.8 $ 86.5 Incentive compensation 137.2 155.2 Profit sharing contribution - 9.3 Customer credits, advanced payments and advanced billings 24.6 17.0 Self-insurance reserves 19.7 21.5 Dividends 78.2 75.0 Professional service fees 54.5 47.0 Interest accrued on debt 59.4 45.0 Accounts payable 22.2 19.4 Income taxes (see Note 14) 11.5 16.1 Pension and other retirement employee benefits (see Note 12) 5.4 5.1 Other 70.1 60.5 Total accounts payable and accrued liabilities $ 566.6 $ 557.6 December 31, 2015 2014 Other liabilities: Pension and other retirement employee benefits (see Note 12) $ 228.3 $ 244.8 Deferred rent-non-current portion 98.4 104.2 Interest accrued on UTPs 27.9 20.8 Legacy and other tax matters 1.7 8.6 Other 60.9 52.5 Total other liabilities $ 417.2 $ 430.9 Changes in the Company’s self-insurance reserves for claims insured by the Company’s wholly-owned insurance subsidiary, which primarily relate to legal defense costs for claims from prior years, are as follows: Year Ended December 31, 2015 2014 2013 Balance January 1, $ 21.5 $ 27.6 $ 55.8 Accruals (reversals), net 22.2 5.8 (0.9) Payments (24.0) (11.9) (27.3) Balance December 31, $ 19.7 $ 21.5 $ 27.6 Redeemable Noncontrolling Interest: In connection with the acquisition of Copal, the Company and the non-controlling shareholders entered into a put/call option agreement whereby the Company had the option to purchase from the non-controlling shareholders and the non-controlling shareholders had the option to sell to the Company the remaining 33 % ownership interest of Copal Partners Limited based on a strike price to be calculated on pre-determined formulas using a combination of revenue and EBITDA multipl es when exercised. The value of the estimated put/call option strike price on the date of acquisition was based on a Monte Carlo simulation model. This model contemplated multiple scenarios which simulated certain of Copal’s revenue, EBITDA margins and equ ity values to estimate the present value of the expected strike price of the option. In connection with the acquisition of Amba in December 2013, which was combined with Copal to form the Copal Amba operating segment and reporting unit, the aforementioned revenue and EBITDA multiples set forth in the put/call option agreement were modified to include the results of Amba. The option was subject to a minimum exercise price of $ 46 million. There was no limit as to the maximum amount of the strike price on the put/call option. In the fourth quarter of 2014, the Company exercised its call option to acquire the remaining interest of Copal Amba. The following table shows changes in the redeemable noncontrolling interest related to the acquisition of Copal Amba: Year Ended December 31, 2014 2013 Redeemable Noncontrolling Interest Balance January 1, $ 80.0 $ 72.3 Net earnings 9.3 5.8 Dividends (4.9) (6.0) Redemption of noncontrolling interest (183.8) - Adjustment to redemption value (1) 99.4 7.9 Balance December 31, $ - $ 80.0 (1) The adjustment to the redemption value in the year ended December 31, 2014 reflects the aforementioned revisions to the revenue and EBITDA multiples pursuant to the amendment of the put/call agreement which occurred contemporaneously with the acquisition of Amba coupled with growth in the Copal Amba reporting unit. These adjustments were recorded with a corresponding reduction to capital surplus. |
DETAIL OF CERTAIN BALANCE SHE54
DETAIL OF CERTAIN BALANCE SHEET INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Additional Details Related to Certain Balance Sheet Captions | December 31, 2015 2014 Other current assets: Prepaid taxes $ 83.3 $ 65.4 Prepaid expenses 66.9 59.9 Other 29.4 47.2 Total other current assets $ 179.6 $ 172.5 December 31, 2015 2014 Other assets: Investments in joint ventures $ 28.7 $ 21.6 Deposits for real-estate leases 11.4 11.3 Indemnification assets related to acquisitions 19.2 23.5 Fixed maturity, open-ended mutual funds, and fixed deposits 55.0 48.0 Other 46.5 41.5 Total other assets $ 160.8 $ 145.9 December 31, 2015 2014 Accounts payable and accrued liabilities: Salaries and benefits $ 83.8 $ 86.5 Incentive compensation 137.2 155.2 Profit sharing contribution - 9.3 Customer credits, advanced payments and advanced billings 24.6 17.0 Self-insurance reserves 19.7 21.5 Dividends 78.2 75.0 Professional service fees 54.5 47.0 Interest accrued on debt 59.4 45.0 Accounts payable 22.2 19.4 Income taxes (see Note 14) 11.5 16.1 Pension and other retirement employee benefits (see Note 12) 5.4 5.1 Other 70.1 60.5 Total accounts payable and accrued liabilities $ 566.6 $ 557.6 December 31, 2015 2014 Other liabilities: Pension and other retirement employee benefits (see Note 12) $ 228.3 $ 244.8 Deferred rent-non-current portion 98.4 104.2 Interest accrued on UTPs 27.9 20.8 Legacy and other tax matters 1.7 8.6 Other 60.9 52.5 Total other liabilities $ 417.2 $ 430.9 |
Self Insurance Reserves | Year Ended December 31, 2015 2014 2013 Balance January 1, $ 21.5 $ 27.6 $ 55.8 Accruals (reversals), net 22.2 5.8 (0.9) Payments (24.0) (11.9) (27.3) Balance December 31, $ 19.7 $ 21.5 $ 27.6 |
Changes in Redeemable Noncontrolling Interest Related to Acquisition | Year Ended December 31, 2014 2013 Redeemable Noncontrolling Interest Balance January 1, $ 80.0 $ 72.3 Net earnings 9.3 5.8 Dividends (4.9) (6.0) Redemption of noncontrolling interest (183.8) - Adjustment to redemption value (1) 99.4 7.9 Balance December 31, $ - $ 80.0 (1) The adjustment to the redemption value in the year ended December 31, 2014 reflects the aforementioned revisions to the revenue and EBITDA multiples pursuant to the amendment of the put/call agreement which occurred contemporaneously with the acquisition of Amba coupled with growth in the Copal Amba reporting unit. These adjustments were recorded with a corresponding reduction to capital surplus. |
Additional Details Related to C
Additional Details Related to Certain Balance Sheet Captions (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Other current assets: | ||
Prepaid taxes | $ 83.3 | $ 65.4 |
Prepaid expenses | 66.9 | 59.9 |
Other | 29.4 | 47.2 |
Total other current assets | 179.6 | 172.5 |
Other assets: | ||
Investments in joint ventures | 28.7 | 21.6 |
Deposits for real-estate leases | 11.4 | 11.3 |
Indemnification assets related to acquisitions | 19.2 | 23.5 |
Fixed maturity and other open ended mutual funds | 55 | 48 |
Other | 46.5 | 41.5 |
Total other assets | 160.8 | 145.9 |
Accounts payable and accrued liabilities: | ||
Salaries and benefits | 83.8 | 86.5 |
Incentive compensation | $ 137.2 | 155.2 |
Profit sharing contribution | 9.3 | |
Customer credits, advanced payments and advanced billings | $ 24.6 | 17 |
Self-insurance reserves | 19.7 | 21.5 |
Dividends | 78.2 | 75 |
Professional service fees | 54.5 | 47 |
Interest accrued on debt | 59.4 | 45 |
Accounts payable | 22.2 | 19.4 |
Income taxes (see Note 14) | 11.5 | 16.1 |
Pension and other retirement employee benefits (see Note 11) | 5.4 | 5.1 |
Other | 70.1 | 60.5 |
Total accounts payable and accrued liabilities | 566.6 | 557.6 |
Other liabilities: | ||
Pension and other retirement employee benefits (see Note 12) | 228.3 | 244.8 |
Deferred rent-non-current portion | 98.4 | 104.2 |
Interest accrued on UTPs | 27.9 | 20.8 |
Legacy and other tax matters | 1.7 | 8.6 |
Other | 60.9 | 52.5 |
Total other liabilities | $ 417.2 | $ 430.9 |
Changes in Self Insurance Reser
Changes in Self Insurance Reserves (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Self Insurance Reserves [Line Items] | |||
Self-insurance reserves, beginning balance | $ 21.5 | $ 27.6 | $ 55.8 |
Accruals (reversals), net | 22.2 | 5.8 | (0.9) |
Payments | (24) | (11.9) | (27.3) |
Self-insurance reserves, ending balance | $ 19.7 | $ 21.5 | $ 27.6 |
Changes in Redeemable Noncontro
Changes in Redeemable Noncontrolling Interest Related to Acquisition Copal (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Redeemable Noncontrolling Interest [Line Items] | ||
Beginning balance | $ 80 | $ 72.3 |
Net earnings | 9.3 | 5.8 |
Dividends | (4.9) | (6) |
Payment to noncontrolling interest | (183.8) | |
Adjustment to redemption value | $ 99.2 | 7.9 |
Ending balance | $ 80 |
Detail of Certain Balance She58
Detail of Certain Balance Sheet Information - Additional Detail (Detail) - Redeemable Noncontrolling Interests (Copal Amba) [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2015 | |
Redeemable Noncontrolling Interest [Line Items] | ||
Remaining ownership interest | 33.00% | |
Minimum exercise price option | $ 46 |
COMPREHENSIVE INCOME RECLASSIFI
COMPREHENSIVE INCOME RECLASSIFICATION | 12 Months Ended |
Dec. 31, 2015 | |
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE INCOME | NOTE 11 . COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE INCOME The following table provides details about the reclassifications out of AOCI: Year Ended December 31, 2015 Year Ended December 31, 2014 Year Ended December 31, 2013 Affected line in the consolidated statement of operations Gains (losses) on currency translation adjustments Liquidation of foreign subsidiary $ 0.1 $ - $ (1.4) Other non-operating income (expense), net Loss on foreign currency translation adjustment pursuant to ICRA step-acquisition - (4.4) - ICRA Gain Total gains (losses) on currency translation adjustments 0.1 (4.4) (1.4) Losses on Cash Flow Hedges Interest rate swap derivative contracts - - (1.2) Interest expense, net Income tax effect of item above - - 0.5 Provision for income taxes Losses on Cash Flow Hedges - - (0.7) Gains on available for sale securities: Gains on available for sale securities 0.9 0.1 - Other income Income tax effect of item above - - - Provision for income taxes Total gains on available for sale securities 0.9 0.1 - Pension and other retirement benefits Amortization of actuarial losses and prior service costs included in net income (8.5) (4.7) (7.6) Operating expense Amortization of actuarial losses and prior service costs included in net income (5.0) (2.6) (4.3) SG&A expense Total before income taxes (13.5) (7.3) (11.9) Income tax effect of item above 5.2 2.8 4.9 Provision for income taxes Total pension and other retirement benefits (8.3) (4.5) (7.0) Total losses included in Net Income attributable to reclassifications out of AOCI $ (7.3) $ (8.8) $ (9.1) The following table shows c hanges in AOCI by c omponent ( n et of t ax): Year Ended December 31, 2015 Pension and Other Retirement Benefits Gains / (Losses) on Cash Flow Hedges Foreign Currency Translation Adjustments Gains on Available for Sale Securities Total Balance December 31, 2014 $ (105.4) $ - $ (130.7) $ 0.9 $ (235.2) Other comprehensive income/(loss) before reclassifications 11.4 (1.1) (125.2) 3.3 (111.6) Amounts reclassified from AOCI 8.3 - (0.1) (0.9) 7.3 Other comprehensive income/(loss) 19.7 (1.1) (125.3) 2.4 (104.3) Balance December 31, 2015 $ (85.7) $ (1.1) $ (256.0) $ 3.3 $ (339.5) Year Ended December 31, 2014 Pension and Other Retirement Benefits Gains / (Losses) on Cash Flow Hedges Foreign Currency Translation Adjustments Gains on Available for Sale Securities Total Balance December 31, 2013 $ (53.2) $ - $ (1.4) $ - $ (54.6) Other comprehensive income/(loss) before reclassifications (56.7) - (133.7) 1.0 (189.4) Amounts reclassified from AOCI 4.5 - 4.4 (0.1) 8.8 Other comprehensive income/(loss) (52.2) - (129.3) 0.9 (180.6) Balance December 31, 2014 $ (105.4) $ - $ (130.7) $ 0.9 $ (235.2) Year Ended December 31, 2013 Pension and Other Retirement Benefits Gains / (Losses) on Cash Flow Hedges Foreign Currency Translation Adjustments Gains on Available for Sale Securities Total Balance December 31, 2012 $ (90.1) $ (0.7) $ 8.7 $ - $ (82.1) Other comprehensive income/(loss) before reclassifications 29.9 - (11.5) - 18.4 Amounts reclassified from AOCI 7.0 0.7 1.4 - 9.1 Other comprehensive income/(loss) 36.9 0.7 (10.1) - 27.5 Balance December 31, 2013 $ (53.2) $ - $ (1.4) $ - $ (54.6) |
COMPREHENSIVE INCOME RECLASSI60
COMPREHENSIVE INCOME RECLASSIFICATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Reclassifications out of AOCI | Year Ended December 31, 2015 Year Ended December 31, 2014 Year Ended December 31, 2013 Affected line in the consolidated statement of operations Gains (losses) on currency translation adjustments Liquidation of foreign subsidiary $ 0.1 $ - $ (1.4) Other non-operating income (expense), net Loss on foreign currency translation adjustment pursuant to ICRA step-acquisition - (4.4) - ICRA Gain Total gains (losses) on currency translation adjustments 0.1 (4.4) (1.4) Losses on Cash Flow Hedges Interest rate swap derivative contracts - - (1.2) Interest expense, net Income tax effect of item above - - 0.5 Provision for income taxes Losses on Cash Flow Hedges - - (0.7) Gains on available for sale securities: Gains on available for sale securities 0.9 0.1 - Other income Income tax effect of item above - - - Provision for income taxes Total gains on available for sale securities 0.9 0.1 - Pension and other retirement benefits Amortization of actuarial losses and prior service costs included in net income (8.5) (4.7) (7.6) Operating expense Amortization of actuarial losses and prior service costs included in net income (5.0) (2.6) (4.3) SG&A expense Total before income taxes (13.5) (7.3) (11.9) Income tax effect of item above 5.2 2.8 4.9 Provision for income taxes Total pension and other retirement benefits (8.3) (4.5) (7.0) Total losses included in Net Income attributable to reclassifications out of AOCI $ (7.3) $ (8.8) $ (9.1) |
Components of Accumulated Other Comprehensive Income | Year Ended December 31, 2015 Pension and Other Retirement Benefits Gains / (Losses) on Cash Flow Hedges Foreign Currency Translation Adjustments Gains on Available for Sale Securities Total Balance December 31, 2014 $ (105.4) $ - $ (130.7) $ 0.9 $ (235.2) Other comprehensive income/(loss) before reclassifications 11.4 (1.1) (125.2) 3.3 (111.6) Amounts reclassified from AOCI 8.3 - (0.1) (0.9) 7.3 Other comprehensive income/(loss) 19.7 (1.1) (125.3) 2.4 (104.3) Balance December 31, 2015 $ (85.7) $ (1.1) $ (256.0) $ 3.3 $ (339.5) Year Ended December 31, 2014 Pension and Other Retirement Benefits Gains / (Losses) on Cash Flow Hedges Foreign Currency Translation Adjustments Gains on Available for Sale Securities Total Balance December 31, 2013 $ (53.2) $ - $ (1.4) $ - $ (54.6) Other comprehensive income/(loss) before reclassifications (56.7) - (133.7) 1.0 (189.4) Amounts reclassified from AOCI 4.5 - 4.4 (0.1) 8.8 Other comprehensive income/(loss) (52.2) - (129.3) 0.9 (180.6) Balance December 31, 2014 $ (105.4) $ - $ (130.7) $ 0.9 $ (235.2) Year Ended December 31, 2013 Pension and Other Retirement Benefits Gains / (Losses) on Cash Flow Hedges Foreign Currency Translation Adjustments Gains on Available for Sale Securities Total Balance December 31, 2012 $ (90.1) $ (0.7) $ 8.7 $ - $ (82.1) Other comprehensive income/(loss) before reclassifications 29.9 - (11.5) - 18.4 Amounts reclassified from AOCI 7.0 0.7 1.4 - 9.1 Other comprehensive income/(loss) 36.9 0.7 (10.1) - 27.5 Balance December 31, 2013 $ (53.2) $ - $ (1.4) $ - $ (54.6) |
Reclassification out of AOCI (D
Reclassification out of AOCI (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Gains/(losses) on foreign currency translation adjustments | |||
Liquidation of foreign subsidiary | $ 0.1 | $ (4.4) | $ (1.4) |
Total gains/(losses) on foreign translation adjustments | 0.1 | (4.4) | (1.4) |
Cash flow and net investment hedges, net of tax: | |||
Losses included cash flow hedges - Pre Tax | (1.2) | ||
Losses included cash flow hedges - Tax | 0.5 | ||
Losses included cash flow hedges - Net of Tax | (0.7) | ||
Gains on available for sale securities: | |||
Gains on available for sale securities | 0.9 | 0.1 | |
Pension and other retirement benefits, net of tax: | |||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | (13.5) | (7.3) | (11.9) |
Amortization of actuarial losses and prior service costs included in net income - Tax | 5.2 | 2.8 | 4.9 |
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | (8.3) | (4.5) | (7) |
Income (loss) attributable to reclassification out of AOCI - Net of Tax | (7.3) | (8.8) | (9.1) |
Other Nonoperating Income [Member] | |||
Gains/(losses) on foreign currency translation adjustments | |||
Liquidation of foreign subsidiary | 0.1 | (1.4) | |
ICRA Gain [Member] | |||
Gains/(losses) on foreign currency translation adjustments | |||
Foreign currency translation adjustment reclassification of losses to net income pursuant to ICRA Step Acquisition | (4.4) | ||
Other Income [Member] | |||
Gains on available for sale securities: | |||
Gains on available for sale securities | 0.9 | 0.1 | |
Operating Expense [Member] | |||
Pension and other retirement benefits, net of tax: | |||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | (8.5) | (4.7) | (7.6) |
SG&A Expenses [Member] | |||
Pension and other retirement benefits, net of tax: | |||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | $ (5) | $ (2.6) | (4.3) |
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | |||
Cash flow and net investment hedges, net of tax: | |||
Losses included cash flow hedges - Tax | 0.5 | ||
Losses included cash flow hedges - Net of Tax | (0.7) | ||
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Interest Income (Expense), Net [Member] | |||
Cash flow and net investment hedges, net of tax: | |||
Losses included cash flow hedges - Pre Tax | $ (1.2) |
Changes in Components of Accumu
Changes in Components of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Beginning Balance | $ (235.2) | $ (54.6) | $ (82.1) |
Net unrealized gain (losses) on cash flow - Net of Tax | (1.1) | ||
Reclassification gain (losses) on cash flow hedges - Net of Tax | 0.7 | ||
Gains/(Losses) on cash flow hedges | (1.1) | 0.7 | |
Pension and other retirement benefit plans before reclassification - Net of Tax | 11.4 | (56.7) | 29.9 |
Reclassification adjustment from AOCI, pension and other retirement benefit plans - Net of Tax | 8.3 | 4.5 | 7 |
Pension and other post retirement benefit - Net of Tax | 19.7 | (52.2) | 36.9 |
Foreign currency translation adjustments before reclassification - Net of Tax | (125.2) | (133.7) | (11.5) |
Amount reclassified from AOCI, Foreign currency translation adjustment - Net of Tax | (0.1) | 4.4 | 1.4 |
Foreign currency translation adjustments - Net of Tax | (125.3) | (129.3) | (10.1) |
Available for sale securities before reclassification - Net of Tax | 3.3 | 1 | |
Amount reclassified from AOCI, available for sale securities - Net of Tax | (0.9) | (0.1) | |
Available for sale securities - Net of Tax | 2.4 | 0.9 | |
Other comprehensive income/(loss) before reclassifications | (111.6) | (189.4) | 18.4 |
Total other comprehensive income (loss) - Net of Tax | (104.3) | (180.6) | 27.5 |
Amounts reclassified from AOCI | 7.3 | 8.8 | 9.1 |
Ending Balance | (339.5) | (235.2) | (54.6) |
Gains/(Losses) on Cash Flow Hedges [Member] | |||
Beginning Balance | (0.7) | ||
Ending Balance | (1.1) | ||
Pension and Other Postretirement Plans Costs [Member] | |||
Beginning Balance | (105.4) | (53.2) | (90.1) |
Ending Balance | (85.7) | (105.4) | (53.2) |
Foreign Currency Gain (Loss) [Member] | |||
Beginning Balance | (130.7) | (1.4) | 8.7 |
Ending Balance | (256) | (130.7) | $ (1.4) |
Available for Sale Securities [Member] | |||
Beginning Balance | 0.9 | ||
Ending Balance | $ 3.3 | $ 0.9 |
PENSION AND OTHER RETIREMENT BE
PENSION AND OTHER RETIREMENT BENEFITS | 12 Months Ended |
Dec. 31, 2015 | |
PENSION AND OTHER RETIREMENT BENEFITS | NOTE 12 PENSION AND OTHER RETIREMENT BENEFITS U.S. Plans Moody’s maintains funded and unfunded noncontributory Defined Benefit Pension Plans. The U.S. plans provide defined benefits using a cash balance formula based on years of service and career average salary or final average pay for selected executives. The Company also provides certain healthcare and life insurance benefits for retired U.S. employees. The retirement healthcare plans are contributory; the life insurance plans are noncontributory . Moody’s funded and unfunded U.S. pension plans, the U.S. retirement healthcare plans and the U.S. retirement life insurance plans are collectively referred to herein as the “Retirement Plans”. The U.S. retirement healthcare plans and the U.S. retirement life insurance plans are collectively referred to herein as the “Other Retirement Plans”. Effective at the Distribution Date, Moody’s assumed responsibility for the pension and other retirement benefits relating to its active employees. New D&B has assumed responsibility for the Company’s retirees and vested terminated employees as of the Distribution Date. Through 2007, substantially all U.S. employees were eligible to participate in the Company’s DBPPs. Effective January 1, 2008, the Company no longer off ers DBPPs to U.S. employees hired or rehired on or after January 1, 2008 and new hires in the U.S. instead will receive a retirement contribution in similar benefit value under the Company’s Profit Participation Plan. Current participants of the Company’s Retirement Plans and Other Retirement Plans continue to accrue benefits based on existing plan benefit formulas. Following is a summary of changes in benefit obligations and fair value of plan assets for the Retirement Plans for the years ended December 31 : Pension Plans Other Retirement Plans 2015 2014 2015 2014 Change in benefit obligation: Benefit obligation, beginning of the period $ (461.8) $ (347.1) $ (26.7) $ (20.7) Service cost (21.6) (18.4) (2.2) (1.7) Interest cost (16.9) (16.5) (1.0) (0.9) Plan participants’ contributions - - (0.4) (0.4) Plan amendments 6.4 - 1.2 - Benefits paid 7.5 6.4 0.8 0.6 Actuarial gain (loss) 1.9 (8.3) (0.1) (0.1) Assumption changes 25.3 (77.9) 1.4 (3.5) Benefit obligation, end of the period (459.2) (461.8) (27.0) (26.7) Change in plan assets: Fair value of plan assets, beginning of the period 248.4 204.6 - - Actual return on plan assets (4.5) 12.9 - - Benefits paid (7.4) (6.4) (0.8) (0.6) Employer contributions 24.4 37.3 0.4 0.2 Plan participants' contributions - - 0.4 0.4 Fair value of plan assets, end of the period $ 260.9 $ 248.4 $ - $ - Funded Status of the plans $ (198.3) $ (213.4) $ (27.0) $ (26.7) Amounts recorded on the consolidated balance sheets: Pension and retirement benefits liability - current $ (4.4) $ (4.3) $ (1.0) $ (0.8) Pension and retirement benefits liability - non current (193.9) (209.1) (26.0) (25.9) Net amount recognized $ (198.3) $ (213.4) $ (27.0) $ (26.7) Accumulated benefit obligation, end of the period $ (405.3) $ (396.3) The following information is for those pension plans with an accumulated benefit obligation in excess of plan assets: December 31, 2015 2014 Aggregate projected benefit obligation $ 459.2 $ 461.8 Aggregate accumulated benefit obligation $ 405.3 $ 396.3 Aggregate fair value of plan assets $ 260.9 $ 248.4 The following table summarizes the pre-tax net actuarial losses and prior service cost recognized in AOCI for the Company’s Retirement Plans as of December 31: Pension Plans Other Retirement Plans 2015 2014 2015 2014 Net actuarial losses $ (144.6) $ (165.5) $ (4.4) $ (6.0) Net prior service costs 4.5 (2.7) 1.2 - Total recognized in AOCI- pretax $ (140.1) $ (168.2) $ (3.2) $ (6.0) The following table summarizes the estimated pre-tax net actuarial losses and prior service cost for the Company’s Retirement Plans that will be amortized from AOCI and recognized as components of net periodic expense during the next fiscal year: Pension Plans Other Retirement Plans Net actuarial losses $ 10.3 $ 0.2 Net prior service costs 0.1 (0.3) Total to be recognized as components of net periodic expense $ 10.4 $ (0.1) Net periodic benefit expenses recognized for the Retirement Plans for years ended December 31: Pension Plans Other Retirement Plans 2015 2014 2013 2015 2014 2013 Components of net periodic expense Service cost $ 21.6 $ 18.4 $ 19.8 $ 2.2 $ 1.7 $ 1.7 Interest cost 16.9 16.5 13.5 1.0 0.9 0.8 Expected return on plan assets (14.4) (14.3) (12.9) - - - Amortization of net actuarial loss from earlier periods 12.5 6.6 10.8 0.3 - 0.3 Amortization of net prior service costs from earlier periods 0.7 0.7 0.6 - - - Net periodic expense $ 37.3 $ 27.9 $ 31.8 $ 3.5 $ 2.6 $ 2.8 The following table summarizes the pre-tax amounts recorded in OCI related to the Company’s Retirement Plans for the years ended December 31: Pension Plans Other Retirement Plans 2015 2014 2015 2014 Amortization of net actuarial losses $ 12.5 $ 6.6 $ 0.3 $ - Amortization of prior service costs 0.7 0.7 - - Prior service costs 6.5 - 1.2 - Net actuarial gain (loss) arising during the period 8.4 (87.5) 1.3 (3.7) Total recognized in OCI – pre-tax $ 28.1 $ (80.2) $ 2.8 $ (3.7) ADDITIONAL INFORMATION: Assumptions – Retirement Plans Weighted-average assumptions used to determine benefit obligations at December 31: Pension Plans Other Retirement Plans 2015 2014 2015 2014 Discount rate 4.04% 3.78% 4.00% 3.65% Rate of compensation increase 3.74% 3.76% - - Weighted-average assumptions used to determine net periodic benefit expense for years ended December 31: Pension Plans Other Retirement Plans 2015 2014 2013 2015 2014 2013 Discount rate 3.78% 4.71% 3.82% 3.65% 4.45% 3.55% Expected return on plan assets 5.80% 6.80% 7.30% - - - Rate of compensation increase 3.76% 4.00% 4.00% - - - The expected rate of return on plan assets represents the Company’s best estimate of the long-term return on plan assets and is determined by using a building block approach, which generally weighs the underlying long-term expected rate of return for each major asset class based on their respective allocation target within the plan portfolio, net of plan paid expenses. As the assumption reflects a long-term time horizon, the plan performance in any one particular year does not, by itself, significantly inf luence th e Company’s evaluation. For 2015 , the expected rate of return used in calculating the net periodic benefit costs was 5.80% . For 2016, the Company’s expected rate of return assumption was 6.10% to refl ect the C ompany’s current view of long-term capital market outlook. In addition, the Company has updated it s mortality assumption by adopting the newly released RP-2014 mortality tables and accompanying morta lity improvement scale MP-2015 recently issued by the So ciety of Actuaries. Additionally, the assumed healthcare cost trend rate assumption is not material to the valuation of the other retirement plans. Plan Assets Moody’s investment objective for the assets in the funded pension plan is to earn total returns that will minimize future contribution requirements over the long-term within a prudent level of risk. The Company works with its independent investment consultants to determine asset allocation targets for its pension plan investment portfolio based on its assessment of business and financial conditions, demographic and actuarial data, funding characteristics, and related risk factors. Other re levant factors, including historical and forward looking views of inflation and capital market returns, are also considered. Risk management practices include monitoring plan asset performance , diversification across asset classes and investment styles, an d periodic rebalancing toward asset allocation targets. The Company’s Asset Management Committee is responsible for overseeing the investment activities of the plan, which includes selecting acceptable asset classes, defining allowable ranges of holdings by asset class and by individual investment managers, defining acceptable securities within each asset class, and establishing investment performance expectations. Ongoing monitoring of the plan includes reviews of investment performance and managers on a regular basis, annual liability measurements, and periodic asset/liability studies. In 2014, the Company implemented a revised investment policy, which uses risk-controlled investment strategies by increasing the plan’s asset allocation to fixed incom e securities and specifying ranges of acceptable target allocation by asset class based on different levels of the plan’s accounting funded status. In addition, the investment policy also requires the investment grade fixed income asset be rebalanced betw een shorter and longer duration bonds as the interest rate environment change s . This revised investment policy is designed to help protect the plan’s funded status and to limit volatility of the Company’s contributions. Based on the revised policy, t he Co mpany’s current target asset allocation is approximately 53% (range of 48% to 58% ) in equity securities, 40% (range of 35% to 45% ) in fixed income securities and 7% (range of 4% to 10% ) in other investments and the plan will use a combination of active and passive investment strategies and different investment styles for its investment portfolios within each asset class. The plan’s equity investments are diversified across U.S. and non-U.S. stocks of small, medium and large capitalization. The plan’s fixed income investments are diversified principally across U.S. and non-U.S. government and corporate bonds which a re expected to help reduce plan exposure to interest rate variation and to better align assets with obligations. The plan also invests in other fixed income investments such debts rated below investment grade, emerging market debt, and convertible securiti es. The plan’s other investment, which is made through private real estate investment trust fund, is expected to provide additional diversification benefits and absolute return enhancement to the plan assets. Fair value of the assets in the Company’s funded pension plan by asset category at December 31, 201 5 and 201 4 are as follows: Fair Value Measurement as of December 31, 2015 Asset Category Balance Level 1 Level 2 % of total assets Cash and cash equivalent $ 0.5 $ - $ 0.5 - Common/collective trust funds - equity securities Global large-cap 99.9 - 99.9 38% U.S. small and mid-cap 16.0 - 16.0 6% Emerging markets 16.5 - 16.5 6% Total equity investments 132.4 - 132.4 51% Emerging markets bond fund 10.6 10.6 - 4% Common/collective trust funds - fixed income securities Intermediate-term investment grade U.S. government/ corporate bonds 69.8 - 69.8 27% U.S. Treasury Inflation-Protected Securities (TIPs) 12.5 - 12.5 5% Private investment fund - convertible securities 7.3 - 7.3 3% Private investment fund - high yield securities 7.4 - 7.4 3% Total fixed-income investments 107.6 10.6 97.0 41% Other investment- Common/collective trust fund — private real estate fund 20.4 - 20.4 8% Total Assets $ 260.9 $ 10.6 $ 250.3 100% Fair Value Measurement as of December 31, 2014 Asset Category Balance Level 1 Level 2 % of total assets Cash and cash equivalent $ 13.2 $ - $ 13.2 5% Emerging markets equity fund 14.0 $ 14.0 $ - 6% Common/collective trust funds - equity securities U.S. large-cap 92.2 - 92.2 37% U.S. small and mid-cap 16.5 - 16.5 7% Total equity investments 122.7 14.0 108.7 50% Emerging markets bond fund 9.1 9.1 - 4% Common/collective trust funds - fixed income securities Intermediate-term investment grade U.S. government/ corporate bonds 60.8 - 60.8 24% U.S. Treasury Inflation-Protected Securities (TIPs) 10.7 - 10.7 4% Convertible securities 7.5 - 7.5 3% Private investment fund - high yield securities 6.7 - 6.7 3% Total fixed-income investments 94.8 9.1 85.7 38% Other investment - Common/collective trust fund - private real estate fund 17.8 - 17.8 7% Total Assets $ 248.5 $ 23.1 $ 225.4 100% Cash and cash equivalent s are primarily comprised of investment in money market mutual funds. In determining fair value, Level 1 investments are valued based on quoted market prices in active markets. Investments in common/collective trust funds are valued using the net asset value (N AV) per unit in each fund. The NAV is based on the value of the underlying investments owned by each trust, minus its liabilities, and then divided by the number of shares outstanding. Common/collective trust funds are categorized in Level 2 to the extent that they are readily redeemable at their NAV as of the measurement date or in the near feature or else they are categorized in Level 3 of the fair value hierarchy. Except for the Company’s U.S. funded pension plan, all of Moody’s Retirement Plans are unfunded and therefore have no plan assets. Cash Flows The Company contributed $ 21.6 million and $ 33.7 million to its U.S. funded pension plan during the years ended December 31, 201 5 and 201 4 , respectively. The Company made payments of $ 2.7 million and $ 3.6 million related to its U.S. unfunded pension plan obligations during the years ended December 31, 201 5 and 201 4 , respectively. The Company made payments of $0.4 million and $0.6 million to its Other Retirement Plans during the years ended December 31, 201 5 and 201 4, respectively . The Company presently antici pates making contributions of $ 22.0 million to its funded pension plan and a nticipates making payments of $ 4.4 million related to its unfunded U.S. pension plans and $ 1.0 million related to its Other Retirement Plans during the year ended D ecember 31, 2015 . Estimated Future Benefits Payable Estimated future benefits payments for the Retirement Plans are as follows at ended December 31, 2015: Year Ending December 31, Pension Plans Other Retirement Plans 2016 $ 10.8 $ 1.0 2017 12.6 1.1 2018 42.4 1.3 2019 16.0 1.4 2020 17.5 1.6 2021 – 2025 $ 133.6 $ 10.5 Defined Contribution Plans Moody’s has a Profit Participation Plan covering s ubstantially all U.S. employees. The Profit Participation Plan provides for an employee salary deferral and the Company matches employee contributions , equal to 50% of employee contribution up to a maximum of 3 % of the employee’s pay. Moody’s also makes additional contributions to the Profit Participation Plan based on year-to-year growth in the Company’s EPS. Effective January 1, 2008, all new hires are automatically enrolled in the Profit Participation Plan when they meet eligibility requirements unless they decline participation. As the Company’s U.S. DBPPs are closed to new entrants effective January 1, 2008, all eligible new hires will instead receive a retirement contribution into the Profit Participation Plan in value similar to the pension benefits. Additionally, effective January 1, 2008, the Company implemented a deferred compensation plan in the U.S., which is unfunded and provides for employee d eferral of compensation and Company matching contributions related to compensation in excess of the IRS limitations on benefits and contributions under qualified retirement plans. Total expenses associated with U.S. de fined contribution plans were $ 21.1 mi llion, $ 26.8 million and $ 18.8 million in 201 5 , 201 4 , and 201 3 , respectively. Effective January 1, 2008, Moody’s has designated the Moody’s Stock Fund, an investment option under the Profit Participation Plan, as an Employee Stock Ownership Plan and, as a result, participants in the Moody’s Stock Fund may receive dividends in cash or may reinvest such dividends into the Moody’s Stock Fund. Moody’s paid approximately $ 0.7 million and $ 0. 6 million in dividends during the years ended December 31, 201 5 and 2 01 4 , respectively, for the Company’s common shares held by the Moody’s Stock Fund. The Company records the dividends as a reduction of retained earnings in the Consolidated Statements of Shareholders’ Equity (Deficit). The Moody’s Stock Fund held approxima t ely 488,000 and 490,000 shares of Moody’s common stock at December 31, 201 5 and 201 4 , respectively. International Plans Certain of the Company’s international operations provide pension benefits to their employees. The non-U.S. defined benefit pension plans are immaterial. For defined contribution plans, company contributions are primarily determined as a percentage of employees’ eligible compensation. Moody’s also makes contributions to non-U.S. employees under a profit sharing plan which is based on year-to-year growth in the Company’s diluted EPS. Expenses related to these defined contribution plans for the years ended December 31, 201 5 , 201 4 and 201 3 were $ 26.7 million, $ 30.6 million and $ 19.7 million, respecti vely. |
PENSION AND OTHER RETIREMENT 64
PENSION AND OTHER RETIREMENT BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Changes in Benefit Obligations and Fair Value of Plan Assets for Retirement Plans | Pension Plans Other Retirement Plans 2015 2014 2015 2014 Change in benefit obligation: Benefit obligation, beginning of the period $ (461.8) $ (347.1) $ (26.7) $ (20.7) Service cost (21.6) (18.4) (2.2) (1.7) Interest cost (16.9) (16.5) (1.0) (0.9) Plan participants’ contributions - - (0.4) (0.4) Plan amendments 6.4 - 1.2 - Benefits paid 7.5 6.4 0.8 0.6 Actuarial gain (loss) 1.9 (8.3) (0.1) (0.1) Assumption changes 25.3 (77.9) 1.4 (3.5) Benefit obligation, end of the period (459.2) (461.8) (27.0) (26.7) Change in plan assets: Fair value of plan assets, beginning of the period 248.4 204.6 - - Actual return on plan assets (4.5) 12.9 - - Benefits paid (7.4) (6.4) (0.8) (0.6) Employer contributions 24.4 37.3 0.4 0.2 Plan participants' contributions - - 0.4 0.4 Fair value of plan assets, end of the period $ 260.9 $ 248.4 $ - $ - Funded Status of the plans $ (198.3) $ (213.4) $ (27.0) $ (26.7) Amounts recorded on the consolidated balance sheets: Pension and retirement benefits liability - current $ (4.4) $ (4.3) $ (1.0) $ (0.8) Pension and retirement benefits liability - non current (193.9) (209.1) (26.0) (25.9) Net amount recognized $ (198.3) $ (213.4) $ (27.0) $ (26.7) Accumulated benefit obligation, end of the period $ (405.3) $ (396.3) |
Accumulated Benefit Obligation in Excess of Plan Assets | December 31, 2015 2014 Aggregate projected benefit obligation $ 459.2 $ 461.8 Aggregate accumulated benefit obligation $ 405.3 $ 396.3 Aggregate fair value of plan assets $ 260.9 $ 248.4 |
Summary of Pre-Tax Net Actuarial Losses and Prior Service Cost Recognized in AOCI | Pension Plans Other Retirement Plans 2015 2014 2015 2014 Net actuarial losses $ (144.6) $ (165.5) $ (4.4) $ (6.0) Net prior service costs 4.5 (2.7) 1.2 - Total recognized in AOCI- pretax $ (140.1) $ (168.2) $ (3.2) $ (6.0) |
Summary of Post-Retirement Plans to Amortized from AOCI as Net Periodic Expense during next fiscal year | Pension Plans Other Retirement Plans Net actuarial losses $ 10.3 $ 0.2 Net prior service costs 0.1 (0.3) Total to be recognized as components of net periodic expense $ 10.4 $ (0.1) |
Components of Net Periodic Benefit Expense Related to Retirement Plans | Pension Plans Other Retirement Plans 2015 2014 2013 2015 2014 2013 Components of net periodic expense Service cost $ 21.6 $ 18.4 $ 19.8 $ 2.2 $ 1.7 $ 1.7 Interest cost 16.9 16.5 13.5 1.0 0.9 0.8 Expected return on plan assets (14.4) (14.3) (12.9) - - - Amortization of net actuarial loss from earlier periods 12.5 6.6 10.8 0.3 - 0.3 Amortization of net prior service costs from earlier periods 0.7 0.7 0.6 - - - Net periodic expense $ 37.3 $ 27.9 $ 31.8 $ 3.5 $ 2.6 $ 2.8 |
Summary of Pre-Tax Amounts Recorded in OCI | Pension Plans Other Retirement Plans 2015 2014 2015 2014 Amortization of net actuarial losses $ 12.5 $ 6.6 $ 0.3 $ - Amortization of prior service costs 0.7 0.7 - - Prior service costs 6.5 - 1.2 - Net actuarial gain (loss) arising during the period 8.4 (87.5) 1.3 (3.7) Total recognized in OCI – pre-tax $ 28.1 $ (80.2) $ 2.8 $ (3.7) |
Summary of Pension Plan Assets by Category Based on Hierarchy of Fair Value Measurements | Fair Value Measurement as of December 31, 2015 Asset Category Balance Level 1 Level 2 % of total assets Cash and cash equivalent $ 0.5 $ - $ 0.5 - Common/collective trust funds - equity securities Global large-cap 99.9 - 99.9 38% U.S. small and mid-cap 16.0 - 16.0 6% Emerging markets 16.5 - 16.5 6% Total equity investments 132.4 - 132.4 51% Emerging markets bond fund 10.6 10.6 - 4% Common/collective trust funds - fixed income securities Intermediate-term investment grade U.S. government/ corporate bonds 69.8 - 69.8 27% U.S. Treasury Inflation-Protected Securities (TIPs) 12.5 - 12.5 5% Private investment fund - convertible securities 7.3 - 7.3 3% Private investment fund - high yield securities 7.4 - 7.4 3% Total fixed-income investments 107.6 10.6 97.0 41% Other investment- Common/collective trust fund — private real estate fund 20.4 - 20.4 8% Total Assets $ 260.9 $ 10.6 $ 250.3 100% Fair Value Measurement as of December 31, 2014 Asset Category Balance Level 1 Level 2 % of total assets Cash and cash equivalent $ 13.2 $ - $ 13.2 5% Emerging markets equity fund 14.0 $ 14.0 $ - 6% Common/collective trust funds - equity securities U.S. large-cap 92.2 - 92.2 37% U.S. small and mid-cap 16.5 - 16.5 7% Total equity investments 122.7 14.0 108.7 50% Emerging markets bond fund 9.1 9.1 - 4% Common/collective trust funds - fixed income securities Intermediate-term investment grade U.S. government/ corporate bonds 60.8 - 60.8 24% U.S. Treasury Inflation-Protected Securities (TIPs) 10.7 - 10.7 4% Convertible securities 7.5 - 7.5 3% Private investment fund - high yield securities 6.7 - 6.7 3% Total fixed-income investments 94.8 9.1 85.7 38% Other investment - Common/collective trust fund - private real estate fund 17.8 - 17.8 7% Total Assets $ 248.5 $ 23.1 $ 225.4 100% |
Estimated Future Benefits Payments for Retirement Plans | Year Ending December 31, Pension Plans Other Retirement Plans 2016 $ 10.8 $ 1.0 2017 12.6 1.1 2018 42.4 1.3 2019 16.0 1.4 2020 17.5 1.6 2021 – 2025 $ 133.6 $ 10.5 |
Defined Benefit Obligation [Member] | |
Weighted-average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Expenses | Pension Plans Other Retirement Plans 2015 2014 2015 2014 Discount rate 4.04% 3.78% 4.00% 3.65% Rate of compensation increase 3.74% 3.76% - - |
Defined Periodic Benefit Expense [Member] | |
Weighted-average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Expenses | Pension Plans Other Retirement Plans 2015 2014 2013 2015 2014 2013 Discount rate 3.78% 4.71% 3.82% 3.65% 4.45% 3.55% Expected return on plan assets 5.80% 6.80% 7.30% - - - Rate of compensation increase 3.76% 4.00% 4.00% - - - |
Summary of Changes in Benefit O
Summary of Changes in Benefit Obligations and Fair Value of Plan Assets for Post-Retirement Plans (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Change in fair value of plan assets: | |||
Fair value of plan assets, beginning balance | $ 248.5 | ||
Fair value of plan assets, ending balance | 260.9 | $ 248.5 | |
Amounts recognized on the consolidated balance sheets: | |||
Pension and retirement benefits liability-current | (5.4) | (5.1) | |
Pension and retirement benefits liability-non current | (228.3) | (244.8) | |
Pension Plans [Member] | |||
Change in benefit obligation: | |||
Benefit obligation, beginning of the period | (461.8) | (347.1) | |
Service cost | (21.6) | (18.4) | $ (19.8) |
Interest cost | (16.9) | (16.5) | (13.5) |
Plan amendments | 6.4 | ||
Benefits paid | 7.5 | 6.4 | |
Actuarial gain (loss) | 1.9 | (8.3) | |
Assumption changes | 25.3 | (77.9) | |
Benefit obligation, end of the period | (459.2) | (461.8) | (347.1) |
Change in fair value of plan assets: | |||
Fair value of plan assets, beginning balance | 248.4 | 204.6 | |
Actual return on plan assets | (4.5) | 12.9 | |
Benefits paid | (7.4) | (6.4) | |
Employer contributions | 24.4 | 37.3 | |
Fair value of plan assets, ending balance | 260.9 | 248.4 | 204.6 |
Funded status of the plans | (198.3) | (213.4) | |
Amounts recognized on the consolidated balance sheets: | |||
Pension and retirement benefits liability-current | (4.4) | (4.3) | |
Pension and retirement benefits liability-non current | (193.9) | (209.1) | |
Net amount recognized | (198.3) | (213.4) | |
Accumulated benefit obligation, end of the period | (405.3) | (396.3) | |
Other Retirement Plans [Member] | |||
Change in benefit obligation: | |||
Benefit obligation, beginning of the period | (26.7) | (20.7) | |
Service cost | (2.2) | (1.7) | (1.7) |
Interest cost | (1) | (0.9) | (0.8) |
Plan participants' contributions | (0.4) | (0.4) | |
Plan amendments | 1.2 | ||
Benefits paid | 0.8 | 0.6 | |
Actuarial gain (loss) | (0.1) | (0.1) | |
Assumption changes | 1.4 | (3.5) | |
Benefit obligation, end of the period | (27) | (26.7) | $ (20.7) |
Change in fair value of plan assets: | |||
Benefits paid | (0.8) | (0.6) | |
Employer contributions | 0.4 | 0.2 | |
Plan participants' contributions | 0.4 | 0.4 | |
Funded status of the plans | (27) | (26.7) | |
Amounts recognized on the consolidated balance sheets: | |||
Pension and retirement benefits liability-current | (1) | (0.8) | |
Pension and retirement benefits liability-non current | (26) | (25.9) | |
Net amount recognized | $ (27) | $ (26.7) |
Accumulated Benefit Obligation
Accumulated Benefit Obligation in Excess of Plan Assets (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule Of Pension Plans With Accumulated Benefit Obligations In Excess Of Plan Assets [Line Items] | ||
Aggregate projected benefit obligation | $ 459.2 | $ 461.8 |
Aggregate accumulated benefit obligation | 405.3 | 396.3 |
Aggregate fair value of plan assets | $ 260.9 | $ 248.4 |
Summary of Pre-Tax Net Actuaria
Summary of Pre-Tax Net Actuarial Losses and Prior Service Cost Recognized in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Pension Plans [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Net actuarial losses | $ (144.6) | $ (165.5) |
Net prior service costs | 4.5 | (2.7) |
Total recognized in AOCI- pretax | (140.1) | (168.2) |
Other Retirement Plans [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Net actuarial losses | (4.4) | $ (6) |
Net prior service costs | 1.2 | |
Total recognized in AOCI- pretax | $ (3.2) | $ (6) |
Summary of Post-Retirement Plan
Summary of Post-Retirement Plans to Amortize from Accumulated Other Comprehensive Income (Loss) as Net Periodic Expense (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Pension Plans [Member] | |
Schedule Of Net Periodic Benefit Costs And Assumptions For Defined Benefit Retirement Plans [Line Items] | |
Net actuarial losses | $ 10.3 |
Net prior service costs | 0.1 |
Total to be recognized as components of net periodic expense | 10.4 |
Other Retirement Plans [Member] | |
Schedule Of Net Periodic Benefit Costs And Assumptions For Defined Benefit Retirement Plans [Line Items] | |
Net actuarial losses | 0.2 |
Net prior service costs | (0.3) |
Total to be recognized as components of net periodic expense | $ (0.1) |
Components of Net Periodic Bene
Components of Net Periodic Benefit Expense Related to Retirement Plans (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Pension Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | $ 21.6 | $ 18.4 | $ 19.8 |
Interest cost | 16.9 | 16.5 | 13.5 |
Expected return on plan assets | (14.4) | (14.3) | (12.9) |
Amortization of net actuarial loss from earlier periods | 12.5 | 6.6 | 10.8 |
Amortization of net prior service costs from earlier periods | 0.7 | 0.7 | 0.6 |
Net periodic expense | 37.3 | 27.9 | 31.8 |
Other Retirement Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 2.2 | 1.7 | 1.7 |
Interest cost | 1 | 0.9 | 0.8 |
Amortization of net actuarial loss from earlier periods | 0.3 | 0.3 | |
Net periodic expense | $ 3.5 | $ 2.6 | $ 2.8 |
Summary Of Pre Tax Amounts Reco
Summary Of Pre Tax Amounts Recognized In Other Comprehensive Income (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Pension And Other Retirement Benefits Recognized In Accumulated Other Comprehensive Income Loss [Line Items] | |||
Amortization of prior service costs | $ 13.5 | $ 7.3 | $ 11.9 |
Net actuarial gain (loss) arising during period | 18.5 | (93.8) | $ 50.9 |
Pension Plans [Member] | |||
Schedule Of Pension And Other Retirement Benefits Recognized In Accumulated Other Comprehensive Income Loss [Line Items] | |||
Amortization of net acturial losses | 12.5 | 6.6 | |
Amortization of prior service costs | 0.7 | 0.7 | |
Prior service costs | 6.5 | ||
Net actuarial gain (loss) arising during period | 8.4 | (87.5) | |
Total recognized in OCI - pre-tax | 28.1 | (80.2) | |
Other Retirement Plans [Member] | |||
Schedule Of Pension And Other Retirement Benefits Recognized In Accumulated Other Comprehensive Income Loss [Line Items] | |||
Amortization of net acturial losses | 0.3 | ||
Prior service costs | 1.2 | ||
Net actuarial gain (loss) arising during period | 1.3 | (3.7) | |
Total recognized in OCI - pre-tax | $ 2.8 | $ (3.7) |
Weighted-Average Assumptions Us
Weighted-Average Assumptions Used to Determine Benefit Obligations (Detail) | Dec. 31, 2015 | Dec. 31, 2014 |
Pension Plans [Member] | ||
Schedule Of Benefit Obligations Weighted Average Assumptions [Line Items] | ||
Discount rate | 4.04% | 3.78% |
Rate of compensation increase | 3.74% | 3.76% |
Other Retirement Plans [Member] | ||
Schedule Of Benefit Obligations Weighted Average Assumptions [Line Items] | ||
Discount rate | 4.00% | 3.65% |
Weighted-Average Assumptions 72
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Expense (Detail) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Net Periodic Benefit Costs Weighted Average Assumptions [Line Items] | |||
Expected return on plan assets | 5.80% | ||
Pension Plans [Member] | |||
Schedule Of Net Periodic Benefit Costs Weighted Average Assumptions [Line Items] | |||
Discount rate | 3.78% | 4.71% | 3.82% |
Expected return on plan assets | 5.80% | 6.80% | 7.30% |
Rate of compensation increase | 3.76% | 4.00% | 4.00% |
Other Retirement Plans [Member] | |||
Schedule Of Net Periodic Benefit Costs Weighted Average Assumptions [Line Items] | |||
Discount rate | 3.65% | 4.45% | 3.55% |
Summary of Pension Plan Assets
Summary of Pension Plan Assets by Category Based on Hierarchy of Fair Value Measurements (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 260.9 | $ 248.5 |
Percent of total assets | 100.00% | 100.00% |
Level 1 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 10.6 | $ 23.1 |
Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | 250.3 | 225.4 |
Emerging Markets Bonds [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 10.6 | $ 9.1 |
Percent of total assets | 4.00% | 4.00% |
Emerging Markets Bonds [Member] | Level 1 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 10.6 | $ 9.1 |
Cash and Cash Equivalents [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | 0.5 | $ 13.2 |
Percent of total assets | 5.00% | |
Cash and Cash Equivalents [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | 0.5 | $ 13.2 |
Emerging Markets Equity Fund [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 14 | |
Percent of total assets | 6.00% | |
Emerging Markets Equity Fund [Member] | Level 1 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 14 | |
Equity Securities [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 132.4 | $ 122.7 |
Percent of total assets | 51.00% | 50.00% |
Equity Securities [Member] | Level 1 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 14 | |
Equity Securities [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 132.4 | 108.7 |
Equity Securities [Member] | Global Large-Cap [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 99.9 | |
Percent of total assets | 38.00% | |
Equity Securities [Member] | Global Large-Cap [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 99.9 | |
Equity Securities [Member] | U.S. Large-Cap [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 92.2 | |
Percent of total assets | 37.00% | |
Equity Securities [Member] | U.S. Large-Cap [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 92.2 | |
Equity Securities [Member] | U.S. Small and Mid-Cap [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 16 | $ 16.5 |
Percent of total assets | 6.00% | 7.00% |
Equity Securities [Member] | U.S. Small and Mid-Cap [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 16 | $ 16.5 |
Equity Securities [Member] | Emerging Markets Bonds [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 16.5 | |
Percent of total assets | 6.00% | |
Equity Securities [Member] | Emerging Markets Bonds [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 16.5 | |
Private Real Estate Fund [Member] | High Yield Bonds [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 7.4 | $ 6.7 |
Percent of total assets | 3.00% | 3.00% |
Private Real Estate Fund [Member] | High Yield Bonds [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 7.4 | $ 6.7 |
Private Real Estate Fund [Member] | Convertible Securities [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 7.3 | |
Percent of total assets | 3.00% | |
Private Real Estate Fund [Member] | Convertible Securities [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 7.3 | |
Fixed Income Securities [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 107.6 | $ 94.8 |
Percent of total assets | 41.00% | 38.00% |
Fixed Income Securities [Member] | Level 1 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 10.6 | $ 9.1 |
Fixed Income Securities [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | 97 | 85.7 |
Fixed Income Securities [Member] | Common Collective Trust Funds [Member] | Intermediate Term Investment Grade U.S. Government [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 69.8 | $ 60.8 |
Percent of total assets | 27.00% | 24.00% |
Fixed Income Securities [Member] | Common Collective Trust Funds [Member] | Intermediate Term Investment Grade U.S. Government [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 69.8 | $ 60.8 |
Fixed Income Securities [Member] | Common Collective Trust Funds [Member] | U.S. Treasury Inflation-Protected Securities (TIPs) [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 12.5 | $ 10.7 |
Percent of total assets | 5.00% | 4.00% |
Fixed Income Securities [Member] | Common Collective Trust Funds [Member] | U.S. Treasury Inflation-Protected Securities (TIPs) [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 12.5 | $ 10.7 |
Fixed Income Securities [Member] | Common Collective Trust Funds [Member] | Convertible Securities [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 7.5 | |
Percent of total assets | 3.00% | |
Fixed Income Securities [Member] | Common Collective Trust Funds [Member] | Convertible Securities [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 7.5 | |
Total Other Investment [Member] | Private Real Estate Fund [Member] | Common/Collective Trust Funds - Convertible Securities [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 20.4 | $ 17.8 |
Percent of total assets | 8.00% | 7.00% |
Total Other Investment [Member] | Private Real Estate Fund [Member] | Common/Collective Trust Funds - Convertible Securities [Member] | Level 2 [Member] | ||
Schedule Of Pension And Other Retirement Benefits Changes In Benefit Obligation And Fair Value Of Plan Assets [Line Items] | ||
Total assets | $ 20.4 | $ 17.8 |
Estimated Future Benefits Payme
Estimated Future Benefits Payments for Retirement Plans (Detail) $ in Millions | Dec. 31, 2015USD ($) |
Pension Plans [Member] | |
Schedule Of Other Retirement Benefits Expected Benefit Payments [Line Items] | |
2,016 | $ 10.8 |
2,017 | 12.6 |
2,018 | 42.4 |
2,019 | 16 |
2,020 | 17.5 |
2021 - 2025 | 133.6 |
Other Retirement Plans [Member] | |
Schedule Of Other Retirement Benefits Expected Benefit Payments [Line Items] | |
2,016 | 1 |
2,017 | 1.1 |
2,018 | 1.3 |
2,019 | 1.4 |
2,020 | 1.6 |
2021 - 2025 | $ 10.5 |
Pension and Other Retirement 75
Pension and Other Retirement Benefits - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Expected rate of return | 5.80% | |||
Minimum retirees age | 65 | |||
Dividends paid on ESOP | $ 0.7 | $ 0.6 | ||
Moody's share held in ESOP | 488,000 | 490,000 | ||
U.S. Defined Contribution Plans [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Defined contribution compensation expense | $ 21.1 | $ 26.8 | $ 18.8 | |
International Defined Contribution Plans [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Defined contribution compensation expense | $ 26.7 | 30.6 | 19.7 | |
Defined Contribution Plan [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Employee contribution percentage of employee contribution in participation | 50.00% | |||
Maximum employee contribution in profit participation plan | 3.00% | |||
Funded Pension Plans [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Employer contributions | $ 21.6 | 33.7 | ||
Anticipated contribution to plans | 22 | |||
Unfunded Pension Plans [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Employer contributions | 2.7 | 3.6 | ||
Anticipated contribution to plans | 4.4 | |||
Other Retirement Plans [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Employer contributions | 0.4 | $ 0.2 | ||
Anticipated contribution to plans | $ 1 | |||
Discount rate | 4.00% | 3.65% | ||
Foreign Pension Plans [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Pension expense | $ 0.6 | $ 0.6 | $ 0.6 | |
2016 [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Expected rate of return | 6.10% | |||
Equity Securities [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Plan asset, target asset allocation percentage | 60.00% | |||
Equity Securities [Member] | Revised Investment Policy [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Plan asset, target asset allocation percentage | 53.00% | |||
Plan asset, target asset allocation percentage, minimum | 48.00% | |||
Plan asset, target asset allocation percentage, maximum | 58.00% | |||
Fixed Income Securities [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Plan asset, target asset allocation percentage | 33.00% | |||
Fixed Income Securities [Member] | Revised Investment Policy [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Plan asset, target asset allocation percentage | 40.00% | |||
Plan asset, target asset allocation percentage, minimum | 35.00% | |||
Plan asset, target asset allocation percentage, maximum | 45.00% | |||
Other Investments [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Plan asset, target asset allocation percentage | 7.00% | |||
Other Investments [Member] | Revised Investment Policy [Member] | ||||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Plan asset, target asset allocation percentage | 7.00% | |||
Plan asset, target asset allocation percentage, minimum | 4.00% | |||
Plan asset, target asset allocation percentage, maximum | 10.00% |
STOCK - BASED COMPENSATION PLAN
STOCK - BASED COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2015 | |
STOCK - BASED COMPENSATION PLANS | NOTE 13 STOCK-BASED COMPENSATION PLANS Under the 1998 Plan, 33.0 million shares of the Company’s common stock have been reserved for issuance. The 2001 Plan, which is shareholder approved, permits the granting of up to 50.6 million shares, of which not more than 14.0 million shares are available for grants of awards other than stock options. The Stock Plans also provide for the granting of restricted stock . The Stock Plans provide that o ptions are exercisable not later than ten years from the grant date. The vesting period for awards under the Stock Plans is generally determined by the Board at the date of the grant and has been four years except for employees who a re at or near retirement eligibility, as defined, for which vesting is between one and four years. Additionally, the vesting period is three years for certain per formance-based restricted stock that contain a condit ion whereby the number of shares that ultimately vest are based on the achievement of certain non-market based performance metrics of the Company . Options may not be granted at less than the fair market value of the Company’s common stock at the date of gr ant. The Company maintains the Directors’ Plan for its Board, which permits the granting of awards in the form of non-qualified stock options, restricted stock or performance shares. The Directors’ Plan provides that options ar e exercisable not later than ten years from the grant date. The vesting period is determined by the Board at the date of the grant and is generally one year for both options and restricted stock. Under the Directors’ Plan, 1.7 million shares of co mmon stock were reserved for issuance. Any director of the Company who is not an employee of the Company or any of its subsidiaries as of the date that an award is granted is eligible to participate in the Directors’ Plan. Presented below is a summary of the stock-based compensation expense and associated tax benefit in the accompanying Consolidated Statements of Operations: Year Ended December 31, 2015 2014 2013 Stock-based compensation expense $ 87.2 $ 80.4 $ 67.1 Tax benefit $ 28.6 $ 27.5 $ 24.7 The fair value of each employee stock option award is estimated on the date of grant using the Black-Scholes option-pricing model that uses the assumptions noted below. The expected dividend yield is derived from the annual dividend rate on the date of grant. The expected stock volatility is based on an assessment of historical weekly stock prices of the Company as well as implied volatility from Moody’s traded options. The risk-free interest rate is based on U.S. government zero coupon bonds with maturities similar to the expected holding period. The expected holding period was determined by examining historical and projected post-vesting exercise behavior activity. The following weighted average assumptions were used for options granted: Year Ended December 31, 2015 2014 2013 Expected dividend yield 1.39% 1.41% 1.72% Expected stock volatility 39% 41% 43% Risk-free interest rate 1.88% 2.30% 1.53% Expected holding period 6.9 years 7.2 years 7.2 years Grant date fair value $ 36.08 $ 31.53 $ 17.58 A summary of option activity as of December 31, 2015 and changes during the year then ended is presented below: Options Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2014 6.0 $ 46.00 Granted 0.3 $ 98.08 Exercised (1.5) $ 54.89 Outstanding, December 31, 2015 4.8 $ 46.47 4.1 years $ 256.9 Vested and expected to vest, December 31, 2015 4.7 $ 45.90 4.0 years $ 254.9 Exercisable, December 31, 2015 3.9 $ 40.79 3.2 years $ 231.2 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between Moody’s closing stock price on the last trading day of the year ended December 31, 2015 and the exercise prices, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options as of December 31, 2015 . This amount varies based on the fair value of Moody’s stock. As of December 31, 2015 there was $7.1 million of total unrecognized compensation expense related to options. The expense is expected to be recognized over a weighted average period of 1.4 years. The following table summarizes information relating to stock option exercises: Year Ended December 31, 2015 2014 2013 Proceeds from stock option exercises $ 83.9 $ 145.5 $ 163.3 Aggregate intrinsic value $ 72.9 $ 122.3 $ 112.4 Tax benefit realized upon exercise $ 26.0 $ 43.2 $ 41.1 A summary of the status of the Company’s nonvested restricted stock as of December 31, 2015 and changes during the year then ended is presented below: Nonvested Restricted Stock Shares Weighted Average Grant Date Fair Value Per Share Balance, December 31, 2014 2.7 $ 53.98 Granted 0.9 $ 98.07 Vested (1.2) $ 47.30 Forfeited (0.1) $ 70.42 Balance, December 31, 2015 2.3 $ 75.33 As of December 31, 2015 , there was $95.9 million of total unrecognized compensation expense related to nonvested restricted stock. The expense is expected to be recognized over a weighted average period of 1.6 years . The following table summarizes information relating to the vesting of restricted stock awards: Year Ended December 31, 2015 2014 2013 Fair value of shares upon delivery $ 111.9 $ 92.4 $ 54.6 Tax benefit realized upon delivery $ 38.1 $ 31.2 $ 19.3 A summary of the status of the Company’s performance - based restricted stock as of December 31, 2015 and changes during the year then ended is presented below: Performance-based restricted stock Shares Weighted Average Grant Date Fair Value Per Share Balance, December 31, 2014 0.9 $ 46.09 Granted 0.2 $ 94.08 Vested (0.5) $ 36.78 Balance, December 31, 2015 0.6 $ 64.46 The following table summarizes information relating to the vesting of the Company’s performance-based restricted stock awards: Year Ended December 31, 2015 2014 2013 Fair value of shares upon delivery $ 43.1 $ 38.0 $ 25.5 Tax benefit realized upon delivery $ 15.6 $ 14.4 $ 9.7 As of December 31, 2015 , there was $14.0 million of total unrecognized compensation expense related to this plan. The expense is expected to be recognized over a weighted average period of 0.9 years. The Company has a policy of issuing treasury stock to satisfy shares issued under stock-based compensation plans. In addition, the Company also sponsors the ESPP. Under the ESPP, 6.0 million shares of common stock were reserved for issuanc e. The ESPP allows eligible employees to purchase common stock of the Company on a monthly basis at a discount to the average of the high and the low trading prices on the New York Stock Exchange on the last trading day of each month. This discount was 5% in 2015 , 2014 and 2013 resulting in the ESPP qualifying for non-compensatory status under Topic 718 of the ASC. Accordingly, no compensation expense was recognized for the ESPP in 2015 , 2014 , and 2013 . The employee purchases are funded through after-tax payroll deductions, which plan participants can elect from one percent to ten percent of compensation, subject to the annual federal limit. |
STOCK - BASED COMPENSATION PL77
STOCK - BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Stock-Based Compensation Expense and Associated Tax Benefit | Year Ended December 31, 2015 2014 2013 Stock-based compensation expense $ 87.2 $ 80.4 $ 67.1 Tax benefit $ 28.6 $ 27.5 $ 24.7 |
Weighted Average Assumptions Used in Determining Fair Value for Options Granted | Year Ended December 31, 2015 2014 2013 Expected dividend yield 1.39% 1.41% 1.72% Expected stock volatility 39% 41% 43% Risk-free interest rate 1.88% 2.30% 1.53% Expected holding period 6.9 years 7.2 years 7.2 years Grant date fair value $ 36.08 $ 31.53 $ 17.58 |
Summary of Option Activity | Options Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2014 6.0 $ 46.00 Granted 0.3 $ 98.08 Exercised (1.5) $ 54.89 Outstanding, December 31, 2015 4.8 $ 46.47 4.1 years $ 256.9 Vested and expected to vest, December 31, 2015 4.7 $ 45.90 4.0 years $ 254.9 Exercisable, December 31, 2015 3.9 $ 40.79 3.2 years $ 231.2 |
Summary of Information Relating to Stock Option Exercises | Year Ended December 31, 2015 2014 2013 Proceeds from stock option exercises $ 83.9 $ 145.5 $ 163.3 Aggregate intrinsic value $ 72.9 $ 122.3 $ 112.4 Tax benefit realized upon exercise $ 26.0 $ 43.2 $ 41.1 |
Information Related to Vesting of Restricted Stock Awards | Year Ended December 31, 2015 2014 2013 Fair value of shares upon delivery $ 111.9 $ 92.4 $ 54.6 Tax benefit realized upon delivery $ 38.1 $ 31.2 $ 19.3 |
Performance Based Restricted Stock [Member] | |
Summary of Restricted Stock | Performance-based restricted stock Shares Weighted Average Grant Date Fair Value Per Share Balance, December 31, 2014 0.9 $ 46.09 Granted 0.2 $ 94.08 Vested (0.5) $ 36.78 Balance, December 31, 2015 0.6 $ 64.46 |
Information Related to Vesting of Restricted Stock Awards | Year Ended December 31, 2015 2014 2013 Fair value of shares upon delivery $ 43.1 $ 38.0 $ 25.5 Tax benefit realized upon delivery $ 15.6 $ 14.4 $ 9.7 |
Non Vested Restricted Stock [Member] | |
Summary of Restricted Stock | Nonvested Restricted Stock Shares Weighted Average Grant Date Fair Value Per Share Balance, December 31, 2014 2.7 $ 53.98 Granted 0.9 $ 98.07 Vested (1.2) $ 47.30 Forfeited (0.1) $ 70.42 Balance, December 31, 2015 2.3 $ 75.33 |
Stock-Based Compensation Expens
Stock-Based Compensation Expense and Associated Tax Benefit (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Compensation Related Costs Share Based Payments Disclosure [Line Items] | |||
Stock-based compensation expense | $ 87.2 | $ 80.4 | $ 67.1 |
Tax benefit | $ 28.6 | $ 27.5 | $ 24.7 |
Weighted Average Assumptions us
Weighted Average Assumptions used in Determining Fair Value for Options Granted (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Weighted Average Assumptions For Fair Values Of Stock Options [Line Items] | |||
Expected dividend yield | 1.39% | 1.41% | 1.72% |
Expected stock volatility | 39.00% | 41.00% | 43.00% |
Risk-free interest rate | 1.88% | 2.30% | 1.53% |
Expected holding period | 6 years 10 months 24 days | 7 years 2 months 12 days | 7 years 2 months 12 days |
Grant date fair value | $ 36.08 | $ 31.53 | $ 17.58 |
Summary of Option Activity (Det
Summary of Option Activity (Detail) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Shares | |
Shares, Outstanding, Beginning Balance | shares | 6 |
Shares, Granted | shares | 0.3 |
Shares, Exercised | shares | (1.5) |
Shares, Outstanding, Ending Balance | shares | 4.8 |
Shares, Vested and expected to vest | shares | 4.7 |
Shares, Exercisable | shares | 3.9 |
Weighted Average Exercise Price | |
Weighted Average Exercise Price Per Share, Beginning Balance | $ / shares | $ 46 |
Weighted Average Exercise Price Per Share, Granted | $ / shares | 98.08 |
Weighted Average Exercise Price Per Share, Exercised | $ / shares | 54.89 |
Weighted Average Exercise Price Per Share, Ending Balance | $ / shares | 46.47 |
Weighted Average Exercise Price Per Share, Vested and expected to vest | $ / shares | 45.9 |
Weighted Average Exercise Price Per Share, Exercisable | $ / shares | $ 40.79 |
Weighted Average Remaining Contractual Term | |
Weighted Average Remaining Contractual Term, Outstanding | 4 years 1 month 6 days |
Weighted Average Remaining Contractual Term, Vested and expected to vest | 4 years |
Weighted Average Remaining Contractual Term | 3 years 2 months 12 days |
Aggregate Intrinsic Value | |
Aggregate Intrinsic Value, Outstanding | $ | $ 256.9 |
Aggregate Intrinsic Value, Vested and expected to vest | $ | 254.9 |
Aggregate Intrinsic Value, Exercisable | $ | $ 231.2 |
Summary of Information Relating
Summary of Information Relating to Stock Option Exercises (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |||
Proceeds from stock option exercises | $ 83.9 | $ 145.5 | $ 163.3 |
Aggregate intrinsic value | 72.9 | 122.3 | 112.4 |
Tax benefit realized upon exercise | $ 26 | $ 43.2 | $ 41.1 |
Summary of Nonvested Restricted
Summary of Nonvested Restricted Stock (Detail) - Non Vested Restricted Stock [Member] shares in Millions | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Nonvested Restricted Stock | |
Shares, Beginning Balance | shares | 2.7 |
Shares, Granted | shares | 0.9 |
Shares, Vested | shares | (1.2) |
Shares, Forfeited | shares | (0.1) |
Shares, Ending Balance | shares | 2.3 |
Weighted Average Grant Date Fair Value Per Share | |
Weighted Average Grant Date Fair Value Per Share, Beginning Balance | $ / shares | $ 53.98 |
Weighted Average Grant Date Fair Value Per Share, Granted | $ / shares | 98.07 |
Weighted Average Grant Date Fair Value Per Share, Vested | $ / shares | 47.3 |
Weighted Average Grant Date Fair Value Per Share, Forfeited | $ / shares | 70.42 |
Weighted Average Grant Date Fair Value Per Share, Ending Balance | $ / shares | $ 75.33 |
Information Related to Vesting
Information Related to Vesting of Restricted Stock Awards (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |||
Tax benefit realized upon vesting | $ 26 | $ 43.2 | $ 41.1 |
Restricted Stock [Member] | |||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |||
Fair value of vested shares | 111.9 | 92.4 | 54.6 |
Tax benefit realized upon vesting | $ 38.1 | $ 31.2 | $ 19.3 |
Summary of Performance Based Re
Summary of Performance Based Restricted Stock (Detail) - Performance-Based Restricted Stock [Member] shares in Millions | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Performance based restricted stock | |
Shares, Beginning Balance | shares | 0.9 |
Shares, Granted | shares | 0.2 |
Shares, Vested | shares | (0.5) |
Shares, Ending Balance | shares | 0.6 |
Performance based restricted stock, Weighted Average Grant Date Fair Value Per Share | |
Weighted Average Grant Date Fair Value Per Share, Beginning Balance | $ / shares | $ 46.09 |
Weighted Average Grant Date Fair Value Per Share, Granted | $ / shares | 94.08 |
Weighted Average Grant Date Fair Value Per Share, Vested | $ / shares | 36.78 |
Weighted Average Grant Date Fair Value Per Share, Ending Balance | $ / shares | $ 64.46 |
Information Related to Vestin85
Information Related to Vesting of Performance Based Restricted Stock (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Share Based Compensation Arrangements By Share Based Payment Award Performance Options [Line Items] | |||
Tax benefit realized upon exercise | $ 26 | $ 43.2 | $ 41.1 |
Performance Based Restricted Stock [Member] | |||
Schedule Of Share Based Compensation Arrangements By Share Based Payment Award Performance Options [Line Items] | |||
Fair value of vested shares | 43.1 | 38 | 25.5 |
Tax benefit realized upon exercise | $ 15.6 | $ 14.4 | $ 9.7 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans - Additional Information (Detail) shares in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($)shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized compensation expense | $ | $ 7.1 |
Weighted average period to recognize expense | 1 year 4 months 24 days |
1998 Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock reserve for issuance or grant | 33 |
2001 Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock reserve for issuance or grant | 50.6 |
Other Than Options [Member] | 2001 Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock reserve for issuance or grant | 14 |
Director Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock reserve for issuance or grant | 1.7 |
Restricted Stock [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized compensation expense | $ | $ 95.9 |
Weighted average period to recognize expense | 1 year 8 months 12 days |
Performance-Based Restricted Stock [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized compensation expense | $ | $ 14 |
Weighted average period to recognize expense | 10 months 27 days |
Employee Stock Purchase Plan (ESPP) [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock reserve for issuance or grant | 6 |
Discount allowed to employees on purchase of shares under ESPP plan | 5.00% |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2015 | |
INCOME TAXES | NOTE 14 INCOME TAXES Components of the Company’s provision for income taxes are as follows: Year Ended December 31, 2015 2014 2013 Current: Federal $ 278.2 $ 252.8 $ 226.2 State and Local 40.1 70.2 57.6 Non-U.S. 93.6 102.1 96.8 Total current 411.9 425.1 380.6 Deferred: Federal 14.7 0.9 (13.1) State and Local 7.6 4.9 (5.6) Non-U.S. (4.2) 24.1 (8.5) Total deferred 18.1 29.9 (27.2) Total provision for income taxes $ 430.0 $ 455.0 $ 353.4 A reconciliation of the U.S. federal statutory tax rate to the Company’s effective tax rate on income before provision for income taxes is as follows: Year Ended December 31, 2015 2014 2013 U.S. statutory tax rate 35.0% 35.0% 35.0% State and local taxes, net of federal tax benefit 3.0 3.6 2.9 Benefit of foreign operations (5.8) (7.4) (6.4) Legacy tax items (0.2) (0.2) (0.6) Other (0.8) 0.1 (0.7) Effective tax rate 31.2% 31.1% 30.2% Income tax paid $ 397.4 $ 369.4 $ 335.7 The source of income before provision for income taxes is as follows: Year Ended December 31, 2015 2014 2013 United States $ 913.9 $ 912.6 $ $836.10 International 465.7 548.4 333.2 Income before provision for income taxes $ 1,379.6 $ 1,461.0 $ $1,169.30 The components of deferred tax assets and liabilities are as follows: December 31, 2015 2014 Deferred tax assets: Current: Account receivable allowances $ 6.6 7.7 Accrued compensation and benefits 12.5 14.6 Deferred revenue 8.0 6.7 Legal and professional fees 10.7 10.4 Restructuring 1.2 2.3 Other 3.0 3.5 Total current 42.0 45.2 Non-current: Accumulated depreciation and amortization 0.9 0.9 Stock-based compensation 56.1 62.3 Benefit plans 101.6 108.7 Deferred rent and construction allowance 28.5 30.5 Deferred revenue 35.8 34.2 Foreign net operating loss (1) 3.7 7.5 Uncertain tax positions 38.2 38.3 Self-insured related reserves 22.7 14.9 Other 4.4 5.6 Total non-current 291.9 302.9 Total deferred tax assets 333.9 348.1 Deferred tax liabilities: Current: Compensation and benefits (3.0) (3.0) Unrealized gain on net investment hedges - OCI (24.2) (14.0) Other (1.5) (1.1) Total Current (28.7) (18.1) Non-current: Accumulated depreciation and amortization of intangible assets and capitalized software (203.0) (204.3) Foreign earnings to be repatriated (2.9) (3.4) Self-insured related income (22.7) (16.9) Other liabilities (5.8) (0.1) Total non-current (234.4) (224.7) Total deferred tax liabilities (263.1) (242.8) Net deferred tax asset 70.8 105.3 Valuation allowance (4.3) (6.9) Total net deferred tax assets $ 66.5 $ 98.4 (1) Amounts are primarily set to expire beginning in 2018, if unused. As of December 31, 2015, the Company had $2,367.9 million of undistributed earnings of foreign subsidiaries that it intends to indefinitely reinvest in foreign operations. The Company has not provided deferred income taxes on these indefinitely reinvested earnings. It is not practicable to determine the amount o f deferred taxes that might be required to be provided if such earnings were distributed in the future, due to complexities in the tax laws and in the hypothetical calculations that would have to be made. The Company had valuation allowances of $4.3 million and $6.9 million at December 31, 2015 and 2014, respectively, related to foreign net operating losses for which realization is uncertain. As of December 31, 2015 the Company had $203.4 million of UTPs of which $148.8 million represents the amount that, if recognized, would impact the effective tax rate in future periods. A reconciliation of the beginning and ending amount of UTPs is as follows: Year Ended December 31, 2015 2014 2013 Balance as of January 1 $ 220.3 $ 195.6 $ 156.6 Additions for tax positions related to the current year 24.1 52.5 67.8 Additions for tax positions of prior years 14.0 8.7 6.1 Reductions for tax positions of prior years (41.6) (31.4) (10.1) Settlements with taxing authorities (7.8) (1.8) (21.4) Lapse of statute of limitations (5.6) (3.3) (3.4) Balance as of December 31 $ 203.4 $ 220.3 $ 195.6 The Company classifies interest related to UTPs in interest expense in its consolidated statements of operations. Penalties, if incurred, would be recognized in other non-operating expenses. During the years ended December 31, 2015 and 2014, the Company incurred a net interest expense of $7.2 million and $5.5 million respectively, related to UTPs. As of December 31, 2015 and 2014, the amount of accrued interest recorded in the Company’s consolidated balance sheet related to UTP’s was $27.9 million and $20.8 million, respectively. Moody’s Corporation and subsidiaries are subject to U.S. federal income tax as well as income tax in various state, local and foreign jurisdictions. The Company settled U.S. tax audit years 200 8 through 2010 in the fourth quarter of 2015. The Company’s U.S. federal income tax returns for the years 2011 and 2012 are under examination and its 2013 and 2014 returns remain open to examination. The Company’s New York State income tax returns for 2 011 to 2014 are under examination. The Company’s New York City tax return for 2013 is currently under examination and its 2014 tax return remains open to examination. The Company settled the U.K. tax audit for tax years 2007 through 2011 during the first quarter of 2014. The Company’s U.K. tax return for 2012 is under examination. Tax filings in the U.K. remain open to examination for 2013 and 2014. For current ongoing audits related to open tax years, the Company estimates that it is possible that the bal ance of UTPs could decrease in the next twelve months as a result of the effective settlement of these audits, which might involve the payment of additional taxes, the adjustment of certain deferred taxes and/or the recognition of tax benefits. It is also possible that new issues might be raised by tax authorities which might necessitate increases to the balance of UTPs. As the Company is unable to predict the timing of conclusion of these audits, the Company is unable to estimate the amount of changes to t he balance of UTPs at this time. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Provision for Income Taxes | Year Ended December 31, 2015 2014 2013 Current: Federal $ 278.2 $ 252.8 $ 226.2 State and Local 40.1 70.2 57.6 Non-U.S. 93.6 102.1 96.8 Total current 411.9 425.1 380.6 Deferred: Federal 14.7 0.9 (13.1) State and Local 7.6 4.9 (5.6) Non-U.S. (4.2) 24.1 (8.5) Total deferred 18.1 29.9 (27.2) Total provision for income taxes $ 430.0 $ 455.0 $ 353.4 |
Reconciliation of United States Federal Statutory Tax Rate to Effective Tax Rate on Income before Provision for Income Taxes | Year Ended December 31, 2015 2014 2013 U.S. statutory tax rate 35.0% 35.0% 35.0% State and local taxes, net of federal tax benefit 3.0 3.6 2.9 Benefit of foreign operations (5.8) (7.4) (6.4) Legacy tax items (0.2) (0.2) (0.6) Other (0.8) 0.1 (0.7) Effective tax rate 31.2% 31.1% 30.2% Income tax paid $ 397.4 $ 369.4 $ 335.7 |
Source of Income before Provision for Income Taxes | Year Ended December 31, 2015 2014 2013 United States $ 913.9 $ 912.6 $ $836.10 International 465.7 548.4 333.2 Income before provision for income taxes $ 1,379.6 $ 1,461.0 $ $1,169.30 |
Components of Deferred Tax Assets and Liabilities | December 31, 2015 2014 Deferred tax assets: Current: Account receivable allowances $ 6.6 7.7 Accrued compensation and benefits 12.5 14.6 Deferred revenue 8.0 6.7 Legal and professional fees 10.7 10.4 Restructuring 1.2 2.3 Other 3.0 3.5 Total current 42.0 45.2 Non-current: Accumulated depreciation and amortization 0.9 0.9 Stock-based compensation 56.1 62.3 Benefit plans 101.6 108.7 Deferred rent and construction allowance 28.5 30.5 Deferred revenue 35.8 34.2 Foreign net operating loss (1) 3.7 7.5 Uncertain tax positions 38.2 38.3 Self-insured related reserves 22.7 14.9 Other 4.4 5.6 Total non-current 291.9 302.9 Total deferred tax assets 333.9 348.1 Deferred tax liabilities: Current: Compensation and benefits (3.0) (3.0) Unrealized gain on net investment hedges - OCI (24.2) (14.0) Other (1.5) (1.1) Total Current (28.7) (18.1) Non-current: Accumulated depreciation and amortization of intangible assets and capitalized software (203.0) (204.3) Foreign earnings to be repatriated (2.9) (3.4) Self-insured related income (22.7) (16.9) Other liabilities (5.8) (0.1) Total non-current (234.4) (224.7) Total deferred tax liabilities (263.1) (242.8) Net deferred tax asset 70.8 105.3 Valuation allowance (4.3) (6.9) Total net deferred tax assets $ 66.5 $ 98.4 (1) Amounts are primarily set to expire beginning in 2018, if unused. |
Reconciliation of Uncertain Tax Positions | Year Ended December 31, 2015 2014 2013 Balance as of January 1 $ 220.3 $ 195.6 $ 156.6 Additions for tax positions related to the current year 24.1 52.5 67.8 Additions for tax positions of prior years 14.0 8.7 6.1 Reductions for tax positions of prior years (41.6) (31.4) (10.1) Settlements with taxing authorities (7.8) (1.8) (21.4) Lapse of statute of limitations (5.6) (3.3) (3.4) Balance as of December 31 $ 203.4 $ 220.3 $ 195.6 |
Provision for Income Taxes (Det
Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | |||
Federal | $ 278.2 | $ 252.8 | $ 226.2 |
State and Local | 40.1 | 70.2 | 57.6 |
Non-U.S. | 93.6 | 102.1 | 96.8 |
Total current | 411.9 | 425.1 | 380.6 |
Deferred: | |||
Federal | 14.7 | 0.9 | (13.1) |
State and Local | 7.6 | 4.9 | (5.6) |
Non-U.S. | (4.2) | 24.1 | (8.5) |
Total deferred | 18.1 | 29.9 | (27.2) |
Total provision for income taxes | $ 430 | $ 455 | $ 353.4 |
Reconciliation of United States
Reconciliation of United States Federal Statutory Tax Rate to Effective Tax Rate on Income Before Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
U.S. statutory tax rate | 35.00% | 35.00% | 35.00% |
State and local taxes, net of federal tax benefit | 3.00% | 3.60% | 2.90% |
Benefit of foreign operations | (5.80%) | (7.40%) | (6.40%) |
Legacy tax items | (0.20%) | (0.20%) | (0.60%) |
Other | (0.80%) | 0.10% | (0.70%) |
Effective tax rate | 31.20% | 31.10% | 30.20% |
Income tax paid | $ 397.4 | $ 369.4 | $ 335.7 |
Source of income Before Provisi
Source of income Before Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Loss From Operations Before Provision Benefit For Income Taxes [Line Items] | |||
United States | $ 913.9 | $ 912.6 | $ 836.1 |
International | 465.7 | 548.4 | 333.2 |
Income before provision for income taxes | $ 1,379.6 | $ 1,461 | $ 1,169.3 |
Components of Deferred Tax Asse
Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred tax assets: | ||||
Account receivable allowances | $ 6.6 | $ 7.7 | ||
Accrued compensation and benefits | 12.5 | 14.6 | ||
Deferred revenue | 8 | 6.7 | ||
Legal and professional fees | 10.7 | 10.4 | ||
Restructuring | 1.2 | 2.3 | ||
Other | 3 | 3.5 | ||
Total current | 42 | 45.2 | ||
Accumulated depreciation and amortization | 0.9 | 0.9 | ||
Stock-based compensation | 56.1 | 62.3 | ||
Benefit plans | 101.6 | 108.7 | ||
Deferred rent and construction allowance | 28.5 | 30.5 | ||
Deferred revenue | 35.8 | 34.2 | ||
Foreign net operating loss | 3.7 | 7.5 | ||
Uncertain tax positions | 38.2 | 38.3 | $ 195.6 | |
Self-insured related reserves | 22.7 | 14.9 | ||
Other | 4.4 | 5.6 | ||
Total non-current | 291.9 | 302.9 | ||
Total deferred tax assets | 333.9 | 348.1 | ||
Deferred tax liabilities: | ||||
Compensation and benefits | (3) | (3) | ||
Unrealized gains on net investment hedges | (24.2) | (14) | ||
Other | (1.5) | (1.1) | ||
Total current | (28.7) | (18.1) | ||
Accumulated depreciation and amortization of intangible assets and capitalized software | (203) | (204.3) | ||
Foreign earnings to be repatriated | (2.9) | (3.4) | ||
Self-insured related income | (22.7) | (16.9) | ||
Other | (5.8) | (0.1) | ||
Total non-current | (234.4) | (224.7) | ||
Total deferred tax liabilities | (263.1) | (242.8) | ||
Net deferred tax asset | 70.8 | 105.3 | ||
Valuation allowance | (4.3) | (6.9) | $ 8.4 | $ 15.2 |
Total net deferred tax assets | $ 66.5 | $ 98.4 |
Reconciliation of Uncertain Tax
Reconciliation of Uncertain Tax Positions (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of Unrecognized Tax Benefits | |||
Unrecognized tax positions, beginning balance | $ 220.3 | $ 195.6 | $ 156.6 |
Additions for tax positions related to the current year | 24.1 | 52.5 | 67.8 |
Additions for tax positions of prior years | 14 | 8.7 | 6.1 |
Reductions for tax positions of prior years | (41.6) | (31.4) | (10.1) |
Settlements with taxing authorities | (7.8) | (1.8) | (21.4) |
Lapse of statute of limitations | (5.6) | (3.3) | (3.4) |
Unrecognized tax positions, ending balance | $ 203.4 | $ 220.3 | $ 195.6 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Tax Contingency [Line Items] | ||||
Undistributed earnings of foreign subsidiaries | $ 2,367.9 | |||
Valuation allowance | 4.3 | $ 6.9 | $ (8.4) | $ (15.2) |
Unrecognized Tax Benefits | 203.4 | 220.3 | $ 195.6 | $ 156.6 |
Uncertain tax positions if recognized would impact the effective tax rate | 148.8 | |||
Interest accrued on UTPs | 27.9 | 20.8 | ||
UTPs | ||||
Income Tax Contingency [Line Items] | ||||
Net interest expense | $ 7.2 | $ 5.5 |
INDEBTEDNESS
INDEBTEDNESS | 12 Months Ended |
Dec. 31, 2015 | |
INDEBTEDNESS | NOTE 15 INDEBTEDNESS The following table summarizes total indebtedness: December 31, 2015 2014 Notes payable: 6.06% Series 2007-1 Notes due 2017 300.0 300.0 5.50% 2010 Senior Notes, due 2020, net of unamortized discount of $1.7 million in 2015 and $2.0 million in 2014; also includes a fair value adjustment on an interest rate hedge of $9.4 million in 2015 and $5.8 million in 2014 507.8 503.8 4.50% 2012 Senior Notes, due 2022, net of unamortized discount of $2.8 million in 2015 and $3.1 million in 2014 497.2 496.9 4.875% 2013 Senior Notes, due 2024, net of unamortized discount of $2.3 million in 2015 and 2.5 million in 2014 497.7 497.5 2.75% 2014 Senior Notes (5-Year), due 2019, net of unamortized discount of $0.5 million in 2015 and $0.7 million in 2014; also includes a fair value adjustment on an interest rate hedge of $2.3 million in 2015 and $1.4 million in 2014 451.8 450.7 5.25% 2014 Senior Notes (30-Year), due 2044, net of unamortized discount of $1.6 million in 2015 and 2014; also includes an unamortized premium of $5.0 million relating to additional issuance under the notes in 2015 603.4 298.4 1.75% 2015 Senior Notes, due 2027 543.1 - Total long-term debt $ 3,401.0 $ 2,547.3 Credit Facility On May 11, 2015, the Company entered into a five-year senior, unsecured revolving credit facility with the capacity to borrow up to $1 billion. This replaces the $ 1 billion five-year 2012 Facility that was scheduled to expire in April 2017. Interest on borrowings under the facility is payable at rates that are based on the LIBOR plus a premium that can range from 79.5 basis points to 120 basis points per annum depending on the Company’s ratio of total debt to EBITDA. The Company also pa ys quarterly facility fees, regardless of borrowing activity under the 2015 Facility. The quarterly fees for the 2015 Facility can range from 8 basis points of the facility amount to 17.5 basis points, depending on the Company’s Debt/ EBITDA ratio. The 201 5 Facility contains covenants that, among other things, restrict the ability of the Company and its subsidiaries, without the approval of lenders, to engage in mergers, consolidations, asset sales, transactions with affiliates, sale and leaseback transacti ons or to incur liens, as set forth in the facility agreement. The 2015 Facility also contains a financial covenant that requires the Company to maintain a Debt/EBITDA ratio of not more than 4 to 1 at the end of any fiscal quarter. Upon the occurrence of c ertain financial or economic events, significant corporate events or certain other events of default constituting a default under the 2015 Facility, all loans outstanding under the 2015 Facility (including accrued interest and fees payable thereunder) may be declared immediately due and payable and all lending commitments under the 2015 Facility may be terminated. In addition, certain other events of default under the 2015 Facility would automatically result in amounts outstanding becoming immediately due a nd payable and the termination of all lending commitments. Notes Payable On September 30, 2005, the Company issued and sold through a private placement transaction, $ 300.0 million aggregate principal amount of its Series 2005-1 Senior Unsecured Notes due 2 015 pursuant to the 2005 Agreement. The Series 2005-1 Notes had a ten-year term and bore interest at an annual rate of 4.98 %, payable semi-annually on March 30 and September 30. Proceeds from the sale of the Series 2005-1 Notes were used to refinance $ 300. 0 million aggregate principal amount of the Company’s outstanding 7.61 % senior notes which matured on September 30, 2005. On August 7, 2014, the Company prepaid the Series 2005-1 Notes using proceeds from the issuance of the 2014 Senior Notes (30-year) and the 2014 Senior Notes (5-year). On September 7, 2007, the Company issued and sold through a private placement transaction, $ 300 .0 million aggregate principal amount of its 6.06 % Series 2007-1 Senior Unsecured Notes due 2017 pursuant to the 2007 Agreement. The Series 2007-1 Notes have a ten-year term and bear interest at an annual rate of 6.06 %, payable semi-annually on March 7 and September 7. The Company may prepay the Series 2007-1 Notes, in whole or in part, at any time at a price equal to 100 % of the p rincipal amount being prepaid, plus accrued and unpaid interest and a Make Whole Amount. The 2007 Agreement contains covenants that limit the ability of the Company, and certain of its subsidiaries to, among other things: enter into transactions with affil iates, dispose of assets, incur or create liens, enter into any sale-leaseback transactions, or merge with any other corporation or convey, transfer or lease substantially all of its assets. The Company must also not permit its Debt/EBITDA ratio to exceed 4.0 to 1.0 at the end of any fiscal quarter. On August 19, 2010, the Company issued $ 500 million aggregate principal amount of senior unsecured notes in a public offering. The 2010 Senior Notes bear interest at a fixed rate of 5.50 % and mature on September 1, 2020. Interest on the 2010 Senior Notes will be due semi-annually on September 1 and March 1 of each year, commencing March 1, 2011. The Company may prepay the 2010 Senior Notes, in whole or in part, at any time at a price equal to 100 % of the principa l amount being prepaid, plus accrued and unpaid interest and a Make-Whole Amount. Additionally, at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon occurrence of a “Change of Control Trigger ing Event,” as defined in the 2010 Indenture, at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. The 2010 Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or create liens and enter into sale and leaseback transactions. In addition, the 2010 Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to sell al l or substantially all of its assets to another entity. The 2010 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any indebtedness (as de fined in the 2010 Indenture) when due at maturity in an aggregate amount of $ 50 million or more, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ indebtedness in an aggregate amount of $ 5 0 million or more. Upon the occurrence and during the continuation of an event of default under the 2010 Indenture, the notes may become immediately due and payable either automatically or by the vote of the holders of more than 25 % of the aggregate princi pal amount of all of the notes then outstanding. On November 4, 2011, in connection with the acquisition of Copal, a subsidiary of the Company issued a $ 14.2 million non-interest bearing note to the sellers which represented a portion of the consideration transferred to acquire the Copal entities. If a seller subsequently transfers to the Company all of its shares, the Company must repay the seller its proportion of the principal on the later of (i) the fourth anniversary date of the note or (ii) within a t ime frame set forth in the acquisition agreement relating to the resolution of certain income tax uncertainties pertaining to the transaction . The Company has the right to offset payment of the note against certain indemnification assets associated with UT Ps related to the acquisition. Accordingly, the Company has offset the liability for this note against the indemnification asset, thus no balance for this note is carried on the Company’s consolidated balance sheet at December 31, 2015 and 2014 . In the event that the Company would not be required to settle amounts related to the UTPs, the Company would be required to pay the sellers the principal in accordance with the note agreement. The Company may prepay the note in accordance with c ertain terms set forth in the acquisition agreement. On August 20, 2012, the Company issued $ 500 million aggregate principal amount of unsecured notes in a public offering. The 2012 Senior Notes bear interest at a fixed rate of 4.50 % and mature on Septem ber 1, 2022. Interest on the 2012 Senior Notes will be due semi-annually on September 1 and March 1 of each year, commencing March 1, 2013. The Company may prepay the 2012 Senior Notes, in whole or in part, at any time at a price equal to 100 % of the princ ipal amount being prepaid, plus accrued and unpaid interest and a Make-Whole Amount. Additionally, at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon occurrence of a “Change of Control Trig gering Event,” as defined in the 2012 Indenture, at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. The 2012 Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or create liens and enter into sale and leaseback transactions. In addition, the 2012 Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to sell all or substantially all of its assets to another entity. The 2012 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any indebtedness (as defined in the 2012 Indenture) when due at maturity in an aggregate amount of $ 50 million or more, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ indebtedness in an aggregate amount of $ 50 million or more . Upon the occurrence and during the continuation of an event of default under the 2012 Indenture, the 2012 Senior notes may become immediately due and payable either automatically or by the vote of the holders of more than 25 % of the a ggregate principal amount of all of the notes then outstanding . On August 12, 2013, the Company issued $ 500 million aggregate principal amount of senior unsecured notes in a public offering. The 2013 Senior Notes bear interest at a fixed rate of 4.875 % and mature on February 15, 2024. Interest on the 2013 Senior Notes will be due semi-annually on February 15 and August 15 of each year, commencing February 15, 2014. The Company may prepay the 2013 Senior Notes, in whole or in part, at any time at a price equ al to 100 % of the principal amount being prepaid, plus accrued and unpaid interest and a Make-Whole Amount. Notwithstanding the immediately preceding sentence, the Company may redeem the 2013 Senior Notes, in whole or in part, at any time or from time to t ime on or after November 15, 2023 (three months prior to their maturity), at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding the redemption date. Additionally , at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon occurrence of a “Change of Control Triggering Event,” as defined in the 2013 Indenture, at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. The 2013 Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or create liens and enter into sale and leaseback transactions. In addition, the 2013 Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to sell all or substantially all of its assets to another entity. The 2013 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any indebtedness (as defined in the 2013 Indenture) when due at maturity in an aggregate amount of $ 50 million or mor e, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ indebtedness in an aggregate amount of $ 50 million or more. Upon the occurrence and during the continuation of an event of default unde r the 2013 Indenture, the 2013 Senior Notes may become immediately due and payable either automatically or by the vote of the holders of more than 25 % of the aggregate principal amount of all of the notes then outstanding. On July 16, 2014, the Company iss ued $ 300 million aggregate principal amount of senior unsecured notes in a public offering. The 2014 Senior Notes (30-year) bear interest at a fixed rate of 5.25 % and mature on July 15, 2044. Interest on the 2014 Senior Notes (30-year) will be due semi-ann ually on January 15 and July 15 of each year, commencing January 15, 2015. The Company may prepay the 2014 Senior Notes (30-year), in whole or in part, at any time at a price equal to 100 % of the principal amount being prepaid, plus accrued and unpaid inte rest and a Make-Whole Amount. Additionally, at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon occurrence of a “Change of Control Triggering Event,” as defined in the 2014 Indenture, at a p rice equal to 101 % of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. The 2014 Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or creat e liens and enter into sale and leaseback transactions. In addition, the 2014 Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to sell all or substantially all of its assets to another enti ty. The 2014 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any indebtedness (as defined in the 2014 Indenture) when due at maturity in an aggregate amount of $ 50 million or more, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ indebtedness in an aggregate amount of $ 50 million or more. Upon the occurrence and during th e continuation of an event of default under the 2014 Indenture, the 2014 Senior Notes (30-year) may become immediately due and payable either automatically or by the vote of the holders of more than 25 % of the aggregate principal amount of all of the notes then outstanding. On November 1 3 , 2015, the Company issued an additional $ 300 million aggregate principal amount of the 2014 Senior Notes (30-year) in a public offering. This issuance constitutes an additional issuance of, and a single series with, the $ 3 00 million 2014 Senior Notes (30-year) issued on July 16, 2014 and have the same terms as the 2014 Senior Notes (30-year). On July 16, 2014, the Company issued $ 450 million aggregate principal amount of senior unsecured notes in a public offering. The 20 14 Senior Notes (5-year) bear interest at a fixed rate of 2.75 % and mature July 15, 2019. Interest on the 2014 Senior Notes (5-year) will be due semi-annually on January 15 and July 15 of each year, commencing January 15, 2015. The Company may prepay the 2 014 Senior Notes (5-year), in whole or in part, at any time at a price prior to June 15, 2019, equal to 100 % of the principal amount being prepaid, plus accrued and unpaid interest and a Make-Whole Amount. Notwithstanding the immediately preceding sentence , the Company may redeem the 2014 Senior Notes (5-year), in whole or in part, at any time or from time to time on or after June 15, 2019 (one month prior to their maturity), at a redemption price equal to 100 % of the principal amount of the notes to be red eemed, plus accrued and unpaid interest, if any, to, but excluding the redemption date. Additionally, at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon occurrence of a “Change of Control T riggering Event,” as defined in the 2014 Indenture, at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. The 2014 Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or create liens and enter into sale and leaseback transactions. In addition, the 2014 Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to s ell all or substantially all of its assets to another entity. The 2014 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any indebtedness (as defined in the 2014 Indenture) when due at maturity in an aggregate amount of $ 50 million or more, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ indebtedness in an aggregate amount of $ 50 million or more. Upon the occurrence and during the continuation of an event of default under the 2014 Indenture, the 2014 Senior Notes (5-year) may become immediately due and payable either automatically or by the vote of the holders of more than 25 % of the aggregate principal amount of all of the notes then outstanding. On March 9, 2015, the Company issued € 500 million aggregate principal amount of senior unsecured notes in a public offering. The 2015 Senior Notes bear interest at a fixed rate of 1.75 % and mature on March 9, 2027. Interest on the 2015 Senior Notes is due annually on March 9 of each year, commencing March 9, 2016. The Company may prepay the 2015 Senior Notes, in whole or in part, at any time at a price equal to 100 % of the principa l amount being prepaid, plus accrued and unpaid interest and a Make-Whole Amount. Additionally, at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon occurrence of a “Change of Control Trigger ing Event,” as defined in the 2015 Indenture, at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. The 2015 Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or create liens and enter into sale and leaseback transactions. In addition, the 2015 Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to sell al l or substantially all of its assets to another entity. The 2015 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any indebtedness (as de fined in the 2015 Indenture) when due at maturity in an aggregate amount of $ 50 million or more, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ indebtedness in an aggregate amount of $ 5 0 million or more. Upon the occurrence and during the continuation of an event of default under the 2015 Indenture, the 2015 Senior Notes may become immediately due and payable either automatically or by the vote of the holders of more than 25 % of the aggr egate principal amount of all of the notes then outstanding. The Company has designated €400 million of the 2015 Senior Notes as a net investment hedge as more fully discussed in Note 7. The principal payments due on the Company’s long-term borrowings for each of the next five years are presented in the table below: Year Ending December 31, Series 2007-1 Notes 2010 Senior Notes 2012 Senior Notes 2013 Senior Notes 2014 Senior Notes (5-year) 2014 Senior Notes (30-year) 2015 Senior Notes Total 2016 $ - $ - $ - $ - $ - $ - $ - $ - 2017 300.0 - - - - - - 300.0 2018 - - - - - - - - 2019 - - - - 450.0 - - 450.0 2020 - 500.0 - - - - - 500.0 Thereafter - - 500.0 500.0 - 600.0 543.1 2,143.1 Total $ 300.0 $ 500.0 $ 500.0 $ 500.0 $ 450.0 $ 600.0 $ 543.1 $ 3,393.1 The Company entered into interest rate swaps on the 2010 Senior Notes and the 2014 Senior Notes (5-year) which are more fully discussed in Note 5. At December 31, 2015 , the Company was in compliance with all covenants contained within all of the debt agreements. In addition to the covenants described above, the 2015 Facility, 2015 Senior Notes, 2014 Senior Notes (5-year), 2014 Senior Notes (30-year), the Series 2007-1 Notes, the 2010 Senior Notes, the 2012 Senior Notes and the 2013 Senior Note s contain cross default provisions. These provisions state that default under one of the aforementioned debt instruments could in turn permit lenders under other debt instruments to declare borrowings outstanding under those instruments to be immediately d ue and payable. As of December 31, 2015 , there are no such cross defaults. INTEREST EXPENSE , NET The following table summarizes the components of interest as presented in the consolidated statements of operations: Year Ended December 31, 2015 2014 2013 Income $ 9.7 $ 6.7 $ 5.5 Expense on borrowings (a) (120.6) (118.4) (92.3) Expense on UTPs and other tax related liabilities (b) (5.3) (5.8) (8.6) Legacy Tax (c) 0.7 0.7 3.6 Capitalized 0.4 - - Total $ (115.1) $ (116.8) $ (91.8) Interest paid (d) $ 108.3 $ 113.7 $ 81.9 (a) Includes approximately $11 million in 2014 in net costs related to the prepayment of the Series 2005-1 Notes. (b) The 2015 amount includes approximately $2 million in interest income on a tax refund and a $4 million interest reversal relating to the favorable resolution of a tax audit and an international tax audit. The 2014 amount includes a $2.0 million relating to a reversal of an interest accrual relating to the favorable resolution of an international tax matter. (c) Represents a reduction of accrued interest related to the favorable resolution of Legacy Tax Matters. (d) Interest paid includes net settlements on interest rate swaps more fully discussed in Note 5. The Company’s long-term debt is recorded at its carrying amount, which represents the issuance amount plus or minus any issuance premium or discount, except for the 2010 Senior Notes, and the 2014 Senior Notes (5-Year) which are recorded at the carrying amount adjusted for the fair value of an interest rate swap used to hedge the fair value of the note. The fair value and carrying value of the Company’s long-term debt as of December 31, 2015 and 2014 are as follows : December 31, 2015 December 31, 2014 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Series 2007-1 Notes $ 300.0 $ 320.6 $ 300.0 $ 334.6 2010 Senior Notes 507.8 551.2 503.8 564.4 2012 Senior Notes 497.2 530.0 496.9 537.1 2013 Senior Notes 497.7 533.8 497.5 548.4 2014 Senior Notes (5-Year) 451.8 454.3 450.7 454.3 2014 Senior Notes (30-Year) 603.4 617.7 298.4 333.9 2015 Senior Notes 543.1 520.2 - - Total $ 3,401.0 $ 3,527.8 $ 2,547.3 $ 2,772.7 The fair value of the Company’s long-term debt is estimated using discounted cash flows based on prevailing interest rates available to the Company for borrowings with similar maturities. Accordingly, the inputs used to estimate the fair value of the Company’s long-term debt are classified as Level 2 inputs within the fair value hierarchy. |
INDEBTEDNESS (Tables)
INDEBTEDNESS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Total Indebtedness | December 31, 2015 2014 Notes payable: 6.06% Series 2007-1 Notes due 2017 300.0 300.0 5.50% 2010 Senior Notes, due 2020, net of unamortized discount of $1.7 million in 2015 and $2.0 million in 2014; also includes a fair value adjustment on an interest rate hedge of $9.4 million in 2015 and $5.8 million in 2014 507.8 503.8 4.50% 2012 Senior Notes, due 2022, net of unamortized discount of $2.8 million in 2015 and $3.1 million in 2014 497.2 496.9 4.875% 2013 Senior Notes, due 2024, net of unamortized discount of $2.3 million in 2015 and 2.5 million in 2014 497.7 497.5 2.75% 2014 Senior Notes (5-Year), due 2019, net of unamortized discount of $0.5 million in 2015 and $0.7 million in 2014; also includes a fair value adjustment on an interest rate hedge of $2.3 million in 2015 and $1.4 million in 2014 451.8 450.7 5.25% 2014 Senior Notes (30-Year), due 2044, net of unamortized discount of $1.6 million in 2015 and 2014; also includes an unamortized premium of $5.0 million relating to additional issuance under the notes in 2015 603.4 298.4 1.75% 2015 Senior Notes, due 2027 543.1 - Total long-term debt $ 3,401.0 $ 2,547.3 |
Principal Payments Due on Long-term Borrowings | Year Ending December 31, Series 2007-1 Notes 2010 Senior Notes 2012 Senior Notes 2013 Senior Notes 2014 Senior Notes (5-year) 2014 Senior Notes (30-year) 2015 Senior Notes Total 2016 $ - $ - $ - $ - $ - $ - $ - $ - 2017 300.0 - - - - - - 300.0 2018 - - - - - - - - 2019 - - - - 450.0 - - 450.0 2020 - 500.0 - - - - - 500.0 Thereafter - - 500.0 500.0 - 600.0 543.1 2,143.1 Total $ 300.0 $ 500.0 $ 500.0 $ 500.0 $ 450.0 $ 600.0 $ 543.1 $ 3,393.1 |
Summary of Components of Interest as Presented in Consolidated Statements of Operations | Year Ended December 31, 2015 2014 2013 Income $ 9.7 $ 6.7 $ 5.5 Expense on borrowings (a) (120.6) (118.4) (92.3) Expense on UTPs and other tax related liabilities (b) (5.3) (5.8) (8.6) Legacy Tax (c) 0.7 0.7 3.6 Capitalized 0.4 - - Total $ (115.1) $ (116.8) $ (91.8) Interest paid (d) $ 108.3 $ 113.7 $ 81.9 (a) Includes approximately $11 million in 2014 in net costs related to the prepayment of the Series 2005-1 Notes. (b) The 2015 amount includes approximately $2 million in interest income on a tax refund and a $4 million interest reversal relating to the favorable resolution of a tax audit and an international tax audit. The 2014 amount includes a $2.0 million relating to a reversal of an interest accrual relating to the favorable resolution of an international tax matter. (c) Represents a reduction of accrued interest related to the favorable resolution of Legacy Tax Matters. (d) Interest paid includes net settlements on interest rate swaps more fully discussed in Note 5. |
Fair Value and Carrying Value of Long-term Debt | December 31, 2015 December 31, 2014 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Series 2007-1 Notes $ 300.0 $ 320.6 $ 300.0 $ 334.6 2010 Senior Notes 507.8 551.2 503.8 564.4 2012 Senior Notes 497.2 530.0 496.9 537.1 2013 Senior Notes 497.7 533.8 497.5 548.4 2014 Senior Notes (5-Year) 451.8 454.3 450.7 454.3 2014 Senior Notes (30-Year) 603.4 617.7 298.4 333.9 2015 Senior Notes 543.1 520.2 - - Total $ 3,401.0 $ 3,527.8 $ 2,547.3 $ 2,772.7 |
Summary of Total Indebtedness (
Summary of Total Indebtedness (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 3,401 | $ 2,547.3 |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 300 | 300 |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 507.8 | 503.8 |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 497.2 | 496.9 |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 497.7 | 497.5 |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 451.8 | 450.7 |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 603.4 | $ 298.4 |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 543.1 |
Summary of Total Indebtedness98
Summary of Total Indebtedness (Parenthetical) (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Fair value of interest rate swap | $ 12.6 | $ 41.8 |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 6.06% | |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized discount | $ 1.7 | 2 |
Fair value of interest rate swap | $ 9.4 | 5.8 |
Notes Payable, interest rate | 5.50% | |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized discount | $ 2.8 | 3.1 |
Notes Payable, interest rate | 4.50% | |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized discount | $ 2.3 | 2.5 |
Notes Payable, interest rate | 4.875% | |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized discount | $ 0.5 | 0.7 |
Fair value of interest rate swap | $ 2.3 | 1.4 |
Notes Payable, interest rate | 2.75% | |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized discount | $ 1.6 | $ 1.6 |
Notes Payable, interest rate | 5.25% | |
Unamortized premium on issuance | $ 5 | |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 1.75% |
Principal Payments Due on Long-
Principal Payments Due on Long-Term Borrowings (Detail) $ in Millions | Dec. 31, 2015USD ($) |
Debt Instrument [Line Items] | |
2,016 | |
2,017 | $ 300 |
2,018 | |
2,019 | $ 450 |
2,020 | 500 |
Thereafter | 2,143.1 |
Total long-term debt | 3,393.1 |
Series 2007-1 Notes [Member] | |
Debt Instrument [Line Items] | |
2,017 | 300 |
Total long-term debt | 300 |
2010 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
2,020 | 500 |
Total long-term debt | 500 |
2012 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Thereafter | 500 |
Total long-term debt | 500 |
2013 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Thereafter | 500 |
Total long-term debt | 500 |
2014 Senior Notes (5-Year) [Member] | |
Debt Instrument [Line Items] | |
2,019 | 450 |
Total long-term debt | 450 |
2014 Senior Notes (30-Year) [Member] | |
Debt Instrument [Line Items] | |
Thereafter | 600 |
Total long-term debt | 600 |
2015 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Thereafter | 543.1 |
Total long-term debt | $ 543.1 |
Summary of Components of Intere
Summary of Components of Interest as Presented in Consolidated Statements of Operations (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Debt Instrument [Line Items] | |||
Income | $ 9.7 | $ 6.7 | $ 5.5 |
Expense on borrowings | (120.6) | (118.4) | (92.3) |
Expense on UTPs and other tax related liabilities | (5.3) | (5.8) | (8.6) |
Legacy Tax | 0.7 | 0.7 | 3.6 |
Capitalized | 0.4 | ||
Total | (115.1) | (116.8) | (91.8) |
Interest paid | $ 108.3 | $ 113.7 | $ 81.9 |
Summary of Components of Int101
Summary of Components of Interest as Presented in Consolidated Statements of Operations (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||
Reversal of accrued interest expense related to Legacy Tax Matter | $ 4 | |
Interest Income Securities Tax Exempt | $ 2 | |
Series 2005-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Net costs related to the prepayment of notes | $ 11 | |
Reversal of accrued interest expense related to Legacy Tax Matter | $ 2 |
Fair Value and Carrying Value o
Fair Value and Carrying Value of Long-Term Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Carrying Amount | $ 3,401 | $ 2,547.3 |
Estimated Fair Value | 3,527.8 | 2,772.7 |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 300 | 300 |
Estimated Fair Value | 320.6 | 334.6 |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 507.8 | 503.8 |
Estimated Fair Value | 551.2 | 564.4 |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 497.2 | 496.9 |
Estimated Fair Value | 530 | 537.1 |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 497.7 | 497.5 |
Estimated Fair Value | 533.8 | 548.4 |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 451.8 | 450.7 |
Estimated Fair Value | 454.3 | 454.3 |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 603.4 | 298.4 |
Estimated Fair Value | 617.7 | $ 333.9 |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Carrying Amount | 543.1 | |
Estimated Fair Value | $ 520.2 |
Indebtedness - Additional Infor
Indebtedness - Additional Information (Detail) shares in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($)shares | |
2012 Facility [Member] | |
Debt Instrument [Line Items] | |
Senior unsecured revolving credit facility | $ 1,000 |
Debt to EBITDA ratio | 4 |
2015 Facility [Member] | |
Debt Instrument [Line Items] | |
Unsecured notes due or expire date | 2,017 |
Issuance date of debt | May 11, 2015 |
Series 2005-1 Notes [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 300 |
Senior unsecured notes, interest | 4.98% |
Unsecured notes due or expire date | 2,015 |
Issuance date of debt | Sep. 30, 2005 |
Series 2007-1 Notes [Member] | |
Debt Instrument [Line Items] | |
Debt to EBITDA ratio | 4 |
Debt, aggregate principal amount | $ 300 |
Senior unsecured notes, interest | 6.06% |
Percentage of principal amount being prepaid, plus accrued and unpaid interest | 100.00% |
Unsecured notes due or expire date | 2,017 |
Issuance date of debt | Sep. 7, 2007 |
2010 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 500 |
Senior unsecured notes, interest | 5.50% |
Percentage of principal amount being prepaid, plus accrued and unpaid interest | 100.00% |
Percentage of principal amount, plus accrued and unpaid interest to the date of purchase | 101.00% |
Minimum percentage of aggregate principal amount of notes | 25.00% |
Maturity date of Senior Unsecured Notes | Sep. 7, 2020 |
Issuance date of debt | Aug. 19, 2010 |
2010 Senior Notes [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 |
2012 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 500 |
Senior unsecured notes, interest | 4.50% |
Percentage of principal amount being prepaid, plus accrued and unpaid interest | 100.00% |
Percentage of principal amount, plus accrued and unpaid interest to the date of purchase | 101.00% |
Minimum percentage of aggregate principal amount of notes | 25.00% |
Maturity date of Senior Unsecured Notes | Sep. 1, 2022 |
Issuance date of debt | Aug. 20, 2012 |
2012 Senior Notes [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 |
2013 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 500 |
Senior unsecured notes, interest | 4.875% |
Percentage of principal amount being prepaid, plus accrued and unpaid interest | 100.00% |
Percentage of principal amount, plus accrued and unpaid interest to the date of purchase | 101.00% |
Minimum percentage of aggregate principal amount of notes | 25.00% |
Maturity date of Senior Unsecured Notes | Feb. 15, 2024 |
Issuance date of debt | Aug. 12, 2013 |
2013 Senior Notes [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 |
2014 Senior Notes (5-Year) [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 450 |
Senior unsecured notes, interest | 2.75% |
Percentage of principal amount being prepaid, plus accrued and unpaid interest | 100.00% |
Percentage of principal amount, plus accrued and unpaid interest to the date of purchase | 101.00% |
Minimum percentage of aggregate principal amount of notes | 25.00% |
Maturity date of Senior Unsecured Notes | Jul. 15, 2019 |
Issuance date of debt | Jul. 16, 2014 |
2014 Senior Notes (5-Year) [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 |
2014 Senior Notes (30-Year) [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 300 |
Senior unsecured notes, interest | 5.25% |
Percentage of principal amount being prepaid, plus accrued and unpaid interest | 100.00% |
Percentage of principal amount, plus accrued and unpaid interest to the date of purchase | 101.00% |
Minimum percentage of aggregate principal amount of notes | 25.00% |
Maturity date of Senior Unsecured Notes | Jul. 15, 2044 |
Issuance date of debt | Jul. 16, 2014 |
Additional share issue | shares | 300 |
2014 Senior Notes (30-Year) [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 |
2015 Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 300 |
Maturity date of Senior Unsecured Notes | Mar. 9, 2027 |
Issuance date of debt | Mar. 9, 2015 |
Copal [Member] | |
Debt Instrument [Line Items] | |
Debt, aggregate principal amount | $ 14.2 |
Issuance date of debt | Nov. 4, 2011 |
CAPITAL STOCK
CAPITAL STOCK | 12 Months Ended |
Dec. 31, 2015 | |
CAPITAL STOCK | NOTE 15 CAPITAL STOCK Authorized Capital Stock The total number of shares of all classes of stock that the Company has authority to issue under its Restated Certificate of Incorporation is 1.02 billion shares with a par value of $ 0.01 , of which 1.0 billion are shares of common stock, 10.0 million are shares of preferred stock and 10.0 million are shares of series common stock. The preferred stock and series common stock can be issued with varying terms, as determined by the Board. Share Repurchase Pr ogram The Company implemented a systematic share repurchase program in the third quarter of 2005 through an SEC Rule 10b5-1 program. Moody’s may also purchase opportunistically when conditions warrant. As a result, Moody’s share repurchase activity will co ntinue to vary from quarter to quarter. The table below summarizes the Company’s remaining authority under the various share repurchase programs as of December 31, 2015 : Date Authorized Amount Authorized Remaining Authority December 16, 2014 $ 1,000.0 $ 465.6 December 15, 2015 $ 1,000.0 $ 1,000.0 During 2015 , Moody’s repurchased 10.9 million shares of its common stock under its share repurchase program and issued 3.2 million shares under employee stock-based compensation plans. Dividends The Company’s cash dividends were: Dividends Per Share Year ended December 31, 2015 2014 2013 Declared Paid Declared Paid Declared Paid First quarter $ - $ 0.34 $ - $ 0.28 $ - $ 0.20 Second quarter 0.34 0.34 0.28 0.28 0.20 0.20 Third quarter 0.34 0.34 0.28 0.28 0.25 0.25 Fourth quarter 0.71 0.34 0.62 0.28 0.53 0.25 Total $ 1.39 $ 1.36 $ 1.18 $ 1.12 $ 0.98 $ 0.90 On December 15, 2015 , the Board of the Company approved the declarat ion of a quarterly dividend of $ 0.37 per share of Moody’s common stock, payable on March 10, 2016 to shareholders of record at the close of business on February 19, 2016 . The continued payment of dividends at the rate noted above, or at all, is subject to the discretion of the Board . |
CAPITAL STOCK (Tables)
CAPITAL STOCK (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Share Repurchase Programs | Date Authorized Amount Authorized Remaining Authority December 16, 2014 $ 1,000.0 $ 465.6 December 15, 2015 $ 1,000.0 $ 1,000.0 |
Dividends Paid | Dividends Per Share Year ended December 31, 2015 2014 2013 Declared Paid Declared Paid Declared Paid First quarter $ - $ 0.34 $ - $ 0.28 $ - $ 0.20 Second quarter 0.34 0.34 0.28 0.28 0.20 0.20 Third quarter 0.34 0.34 0.28 0.28 0.25 0.25 Fourth quarter 0.71 0.34 0.62 0.28 0.53 0.25 Total $ 1.39 $ 1.36 $ 1.18 $ 1.12 $ 0.98 $ 0.90 |
Share Repurchase Programs (deta
Share Repurchase Programs (detail) $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
December 16, 2014 [Member] | |
Schedule Of Share Repurchase Programs [Line Items] | |
Share Repurchase Authorization Date | Dec. 16, 2014 |
Amount authorized to be repurchased | $ 1,000 |
Remaining authorized repurchase amount | $ 465.6 |
December 15, 2015 [Member] | |
Schedule Of Share Repurchase Programs [Line Items] | |
Share Repurchase Authorization Date | Dec. 15, 2015 |
Amount authorized to be repurchased | $ 1,000 |
Remaining authorized repurchase amount | $ 1,000 |
Dividends Paid (Detail)
Dividends Paid (Detail) - $ / shares | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Capital Stock [Line Items] | |||||||||||||||||||
Dividends declared per share | $ 0.71 | $ 0.34 | $ 0.34 | $ 0.62 | $ 0.28 | $ 0.28 | $ 0.62 | $ 0.28 | $ 0.28 | $ 0.25 | $ 0.2 | $ 0 | $ 0.53 | $ 1.39 | $ 1.18 | $ 0.98 | |||
Dividends per share paid | $ 0.34 | $ 0.34 | $ 0.34 | $ 0.34 | $ 0.28 | $ 0.28 | $ 0.28 | $ 0.28 | $ 0.28 | $ 0.28 | $ 0.28 | $ 0.28 | $ 0.25 | $ 0.2 | $ 0.2 | $ 0.25 | $ 1.36 | $ 1.12 | $ 0.9 |
Capital Stock - Additional Info
Capital Stock - Additional Information (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 15, 2015 | Dec. 31, 2014 | |
Schedule Of Capital Stock [Line Items] | |||
All classes of stock, shares authorized | 1,020,000,000 | ||
Shares of all classes of stock, par value | $ 0.01 | ||
Common stock, shares authorized | 1,000,000,000 | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Shares repurchased during the period | 10,900,000 | ||
Shares issued during the period for stock-based compensation plans | 3,200,000 | ||
Dividends declaration date | Dec. 16, 2014 | ||
Dividends payable date | Mar. 10, 2015 | ||
Dividends payable record date | Feb. 20, 2015 | ||
Quarterly dividend declare | $ 0.37 | ||
Series Common Stock [Member] | |||
Schedule Of Capital Stock [Line Items] | |||
Common stock, shares authorized | 10,000,000 | 10,000,000 |
LEASE COMMITMENTS
LEASE COMMITMENTS | 12 Months Ended |
Dec. 31, 2015 | |
LEASE COMMITMENTS | NOTE 17 LEASE COMMITMENTS Moody’s operates its business from various leased facilities, which are under operating leases that expire over the next 12 years. Moody’s also leases certain computer and other equipment under operating leases that expire over the next four years. Rent expense, including lease incentives, is amortized on a straight-line basis over the related lease term. Rent expe nse under operating leases for the years ended December 31, 2015 , 2014 and 2013 was $87.6 million, $83.9 million and $74.2 million, respectively. The 21-year operating lease for the Company’ s headquarters at 7WTC which commenced on October 20, 2006 contains a total of 20 years of renewal options. These renewal options apply to both the original lease as well as additional floors leased by the Company beginning in 2014. Additionally, the 17.5 year operating lease for the Company’s London, England office which commenced on February 6, 2008 contains a total of 15 years of renewal options. The minimum rent for operating leases at December 31, 2015 is as follows: Year Ending December 31, Operating Leases 2016 $ 94.8 2017 88.7 2018 83.2 2019 72.7 2020 68.7 Thereafter 417.4 Total minimum lease payments $ 825.5 |
LEASE COMMITMENTS (Tables)
LEASE COMMITMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Operating Leases, Future Minimum Payment | Year Ending December 31, Operating Leases 2016 $ 94.8 2017 88.7 2018 83.2 2019 72.7 2020 68.7 Thereafter 417.4 Total minimum lease payments $ 825.5 |
Operating Lease, Minimum Rent f
Operating Lease, Minimum Rent for Payment (Detail) $ in Millions | Dec. 31, 2015USD ($) |
Lease Commitments And Contingencies [Line Items] | |
2,016 | $ 94.8 |
2,017 | 88.7 |
2,018 | 83.2 |
2,019 | 72.7 |
2,020 | 68.7 |
Thereafter | 417.4 |
Total minimum lease payments | $ 825.5 |
Lease Commitments - Additional
Lease Commitments - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Lease Commitments And Contingencies [Line Items] | |||
Operating lease, period of lease, in years | 12 years | ||
Rent expenses under operating leases | $ 87.6 | $ 83.9 | $ 74.2 |
7 WTC [Member] | |||
Lease Commitments And Contingencies [Line Items] | |||
Operating lease, period of lease, in years | 21 years | ||
Renewal options | 20 years | ||
Commenced date | Oct. 20, 2006 | ||
London [Member] | |||
Lease Commitments And Contingencies [Line Items] | |||
Operating lease, period of lease, in years | 17 years 6 months | ||
Renewal options | 15 years | ||
Commenced date | Feb. 6, 2008 |
CONTINGENCIES
CONTINGENCIES | 12 Months Ended |
Dec. 31, 2015 | |
CONTINGENCIES | N OTE 18 CONTINGENCIES Moody’s is involved in legal and tax proceedings, governmental investigations and inquiries, claims and litigation that are incidental to the Company’s business, including claims based on ratings assigned by MIS. Moody’s is also subject to ongoing tax audits in the normal course of business. Management periodically assesses the Company’s liabilities and contingencies in connection with these matters based upon the latest information available. Moody’s discloses material pending legal proceedings pursuan t to SEC rules and other pending matters as it may determine to be appropriate. Following the global credit crisis of 2008, MIS and other credit rating agencies have been the subject of intense scrutiny, increased regulation, ongoing inquiry and governmen tal investigations, and civil litigation. Legislative, regulatory and enforcement entities around the world are considering additional legislation, regulation and enforcement actions, including with respect to MIS’s compliance with regulatory standards. Mo ody’s periodically receives and is continuing to address subpoenas and inquiries from various governmental authorities, including the U.S. Department of Justice and states attorneys general, and is responding to such investigations and inquiries. In addit ion, the Company is facing litigation from market participants relating to the performance of MIS rated securities. Although Moody’s in the normal course experiences such litigation, the volume and cost of defending such litigation has significantly increa sed following the events in the U.S. subprime residential mortgage sector and global credit markets more broadly over the last several years. On August 25, 2008, Abu Dhabi Commercial Bank filed a purported class action in the United States District Court for the Southern District of New York asserting numerous common-law causes of action against two subsidiaries of the Company, another rating agency, and Morgan Stanley & Co. The action related to securities issued by a structured investment vehicle called Cheyne Finance (the “Cheyne SIV”) and sought, among other things, compensatory and punitive damages. The central allegation against the rating agency defendants was that the credit ratings assigned to the securities issued by the Cheyne SIV were false and misleading. In early proceedings, the court dismissed all claims against the rating agency defendants except those for fraud and aiding and abetting fraud. In June 2010, the court denied plaintiff’s motion for class certification, and additional plaintiffs were subsequently added to the complaint. In January 2012, the rating agency defendants moved for summary judgment with respect to the fraud and aiding and abetting fraud claims. Also in January 2012, in light of new New York state case law, the court per mitted the plaintiffs to file an amended complaint that reasserted previously dismissed claims against all defendants for breach of fiduciary duty, negligence, negligent misrepresentation, and related aiding and abetting claims. In May 2012, the court, rul ing on the rating agency defendants’ motion to dismiss, dismissed all of the reasserted claims except for the negligent misrepresentation claim, and on September 19, 2012, after further proceedings, the court also dismissed the negligent misrepresentation claim. On August 17, 2012, the court ruled on the rating agencies’ motion for summary judgment on the plaintiffs’ remaining claims for fraud and aiding and abetting fraud. The court dismissed, in whole or in part, the fraud claims of four plaintiffs as aga inst Moody’s but allowed the fraud claims to proceed with respect to certain claims of one of those plaintiffs and the claims of the remaining 11 plaintiffs. The court also dismissed all claims against Moody’s for aiding and abetting fraud. Three of the pl aintiffs whose claims were dismissed filed motions for reconsideration, and on November 7, 2012, the court granted two of these motions, reinstating the claims of two plaintiffs that were previously dismissed. On February 1, 2013, the court dismissed the c laims of one additional plaintiff on jurisdictional grounds. Trial on the remaining fraud claims against the rating agencies, and on claims against Morgan Stanley for aiding and abetting fraud and for negligent misrepresentation, was scheduled for May 2013 . On April 24, 2013, pursuant to confidential settlement agreements, the 14 plaintiffs with claims that had been ordered to trial stipulated to the voluntary dismissal, with prejudice, of these claims as against all defendants, and the court so ordered tha t stipulation on April 26, 2013. The settlement did not cover certain claims of two plaintiffs, Commonwealth of Pennsylvania Public School Employees’ Retirement System (“PSERS”) and Commerzbank AG (“Commerzbank”), that were previously dismissed by the Cour t. On May 23, 2013, these two plaintiffs filed a Notice of Appeal to the Second Circuit, seeking reversal of the dismissal of their claims and also seeking reversal of the trial court’s denial of class certification. According to pleadings filed by plainti ffs in earlier proceedings, PSERS and Commerzbank AG seek, respectively, $5.75 million and $69.6 million in compensatory damages in connection with the two claims at issue on the appeal. In October 2014, the Second Circuit affirmed the denial of class cert ification and the dismissal of PSERS’ claim but reversed a ruling of the trial court that had excluded certain evidence relevant to Commerzbank’s principal argument on appeal. The Second Circuit did not reverse the dismissal of Commerzbank’s claim but inst ead certified a legal question concerning Commerzbank’s argument to the New York Court of Appeals. The New York Court of Appeals subsequently agreed to hear the certified question, and on June 30, 2015, the Court of Appeals ruled in Moody’s favor. The case was then returned to the Second Circuit for final disposition of the appeal . On February 23, 2016, the Second Circuit affirmed the dismissal of Commerzbank’s claim. On July 9, 2009, the California Public Employees’ Retirement System (“CalPERS”) filed an action in the Superior Court of Calif ornia in San Francisco (the “Superior Court”) asserting two common-law causes of action, negligent misrepresentation and negligent interference with prospective economic advantage. The complaint named as defendants the Company, MIS, The McGraw-Hill Compani es, Fitch, Inc., and various subsidiaries of Fitch, Inc. (CalPERS subsequently released the Fitch entities from the case). The action relates to the plaintiff’s purchase of securities issued by three structured investment vehicles (“SIVs”) known as Cheyne Finance, Sigma Finance, and Stanfield Victoria Funding. The plaintiff’s complaint seeks unspecified compensatory damages arising from alleged losses in connection with investments that purportedly totaled approximately $1.3 billion; in subsequent court fil ings, the plaintiff claimed to have suffered “unrealized losses” of approximately $779 million. The central allegation against the defendants is that the credit ratings assigned to the securities issued by the SIVs were inaccurate and that the methodologie s used by the rating agencies had no reasonable basis. In August 2009, the defendants removed the action to federal court, but the case was remanded to state court in November 2009 based on a finding that CalPERS is an “arm of the State.” In April 2010, in response to a motion by the defendants, the Superior Court dismissed the claim for negligent interference with prospective economic advantage but declined to dismiss the claim for negligent misrepresentation. In October 2010, the defendants filed a specia l motion to dismiss the remaining negligent misrepresentation claim under California’s “anti-SLAPP” statute, which limits the maintenance of lawsuits based on speech on matters of public interest. In January 2012, the Superior Court denied the anti-SLAPP m otion, ruling that, although the ratings qualify as protected speech activity under California law, the plaintiff had provided sufficient evidence in support of its claims to proceed. The defendants appealed this decision to the California Court of Appeal, which affirmed the Superior Court’s rulings in May 2014, and in September 2014, the Supreme Court of California declined to review the Court of Appeal’s decision. The action has been returned to the Superior Court, where the parties have been conducting d iscovery. On March 11, 2015, pursuant to a settlement agreement in which S&P agreed to pay CalPERS $125 million, S&P was dismissed from the action. On December 23, 2015, following the close of fact discovery, the Company and MIS filed a motion for summary judgment. If the Company and MIS do not prevail on the motion, the Superior Court has scheduled trial to begin in May 2016. In November 2008, Pursuit Partners, LLC and Pursuit Investment Management, LLC filed an amended complaint adding the Company as a defendant to an existing action, which was then pending in the Superior Court of Connecticut in Stamford against UBS AG, UBS Securities LLC, and a UBS employee (collectively, “UBS”). The Company was served in January 2009, and in October 2011, the Company ’s rating agency subsidiary, MIS, was substituted for the Company as a defendant. The action arose out of UBS’s sale of five collateralized debt obligations (“CDOs”) to the plaintiffs, who purchased them on the secondary market in 2007 on behalf of two inv estment funds under their management. With respect to UBS, the plaintiffs alleged, among other things, that UBS made material misrepresentations and omissions in pre-sale communications with the plaintiffs. With respect to MIS, the plaintiffs alleged, amon g other things, that, prior to the plaintiffs’ purchases, MIS provided UBS with non-public information about potential downgrades of the ratings of the CDOs while maintaining inappropriate investment-grade ratings on the CDOs. As to all defendants, plainti ffs sought compensatory damages for alleged investment losses of approximately $44 million, as well as, among other things, attorney’s fees, costs, interest, and punitive damages. Plaintiffs’ initial complaint against the Company asserted claims for fraud, violation of the Connecticut Uniform Securities Act (“CUSA”), aiding and abetting fraud and civil theft by UBS, negligent/reckless conduct, unjust enrichment, and civil conspiracy. In March 2012, the court granted MIS’s motion to strike the claim for unju st enrichment but denied MIS’s motion to strike the other claims. In June 2012, after the close of discovery, MIS moved to dismiss all claims against it for lack of standing and also moved for summary judgment. In October 2012, the court granted the motion to dismiss, but in July 2014, the court granted the plaintiffs’ motion for reconsideration and reinstated the action. In October 2014, MIS filed a new motion to dismiss on jurisdictional grounds, which was denied on February 11, 2015. MIS’s motion for sum mary judgment, originally filed in June 2012, was denied on June 17, 2015. Jury selection for trial began on August 18, 2015, in the Superior Court of Connecticut in Waterbury. On August 21, 2015, prior to the conclusion of jury selection, plaintiffs withd rew all claims against Moody’s, with prejudice, pursuant to a confidential settlement agreement. For claims, litigation and proceedings and governmental investigations and inquires not related to income taxes, where it is both probable that a liability ha s been incurred and the amount of loss can be reasonably estimated, the Company records liabilities in the consolidated financial statements and periodically adjusts these as appropriate. When the reasonable estimate of the loss is within a range of amount s, the minimum amount of the range is accrued unless some higher amount within the range is a better estimate than another amount within the range. In other instances, because of uncertainties related to the probable outcome and/or the amount or range of l oss, management does not record a liability but discloses the contingency if significant. As additional information becomes available, the Company adjusts its assessments and estimates of such matters accordingly. In view of the inherent difficulty of pred icting the outcome of litigation, regulatory, governmental investigations and inquiries, enforcement and similar matters and contingencies, particularly where the claimants seek large or indeterminate damages or where the parties assert novel legal theorie s or the matters involve a large number of parties, the Company cannot predict what the eventual outcome of the pending matters will be or the timing of any resolution of such matters. The Company also cannot predict the impact (if any) that any such matte rs may have on how its business is conducted, on its competitive position or on its financial position, results of operations or cash flows. As the process to resolve any pending matters progresses, management will continue to review the latest information available and assess its ability to predict the outcome of such matters and the effects, if any, on its operations and financial condition. However, in light of the large or indeterminate damages sought in some of them, the absence of similar court ruling s on the theories of law asserted and uncertainties regarding apportionment of any potential damages, an estimate of the range of possible losses cannot be made at this time. |
Contingencies - Additional Info
Contingencies - Additional Information (Detail) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Mar. 31, 2015 | |
Loss Contingencies [Line Items] | ||||
Number of plaintiffs ordered to trial | 14 | |||
Legacy tax liabilities | $ 6.4 | $ 6.4 | $ 19.2 | |
Abu Dhabi Commercial Bank Litigation [Member] | ||||
Loss Contingencies [Line Items] | ||||
Number of plaintiffs dismissed by court | 4 | |||
Number of plaintiffs | 11 | |||
Number of plaintiffs granted | 2 | |||
Number of plaintiffs filed motions for reconsideration | 3 | |||
Total compensatory damages value | $ 76 | |||
King County, Washington and Iowa Student Loan Liquidity Corporation [Member] | ||||
Loss Contingencies [Line Items] | ||||
Number of plaintiffs | 2 | |||
CalPERS [Member] | ||||
Loss Contingencies [Line Items] | ||||
Unrealized losses claimed by the plaintiff | $ 779 | |||
CalPERS [Member] | Damages Sought for All Plaintiffs [Member] | ||||
Loss Contingencies [Line Items] | ||||
Total compensatory damages value | 1,300 | |||
Pursuit Partners LLC [Member] | Damages Sought for All Plaintiffs [Member] | ||||
Loss Contingencies [Line Items] | ||||
Total compensatory damages value | $ 44 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2015 | |
SEGMENT INFORMATION | NOTE 19 SEGMENT INFORMATION The Company is organized into three operating segments: (i) MIS, (ii) MA and (iii) Copal Amba. The Copal Amba operating segment has been aggregated with the MA operating segment based on the fact that it has similar economic characteristics to MA. Accordingly, the Company reports in two reportable segments: MIS and MA. In January 2014, the Company revised its operating se gments to create the new Copal Amba operating segment. The new operating segment consists of all operations from Copal and the operations of Amba which was acquired in December 2013. The Copal Amba operating segment provides offshore research and analyt ic services to the global financial and corporate sectors. The Company has determined that the Copal Amba and MA operating segments have similar economic characteristics as set forth in ASC 280. As such, Copal Amba has been combined with MA to form the M A reportable segment and Copal Amba’s revenue is reported in the PS LOB. In the fourth quarter of 2014, pursuant to the acquisition of ICRA, Moody’s realigned certain components of its reportable segments to better align with the current management structu re of the Company. The effect of this realignment was to combine non-ratings ICRA operations with certain immaterial research and financial instruments pricing operations in the Asia-Pacific region that were previously reported in the RD&A LOB of MA. All of these operations are managed by MIS and their revenue is now reported in the MIS Other LOB. All operating expenses from these operations are reported in the MIS reportable segment. The impact of this realignment did not have a significant impact on previously reported results for the reportable segments and all prior year comparative periods have been restated to reflect this realignment. The MIS segment now consists of five LOBs. The CFG , SFG , FIG and PPIF LOBs generate revenue principally from fees for the assignment and ongoing monitoring of credit ratings on debt obligations and the entities that issue such obligations in markets worldwide. The MIS Other L OB primarily consists of the distribution of research and financial instruments pricing services in the Asia-Pacific region as well as ICRA non-ratings revenue. The MA segment develops a wide range of products and services that support the risk management activities of institutional participants in global financial markets. The MA segment consists of three LOBs - RD&A, ERS and PS. In July 2014, a subsidiary of the Company acquired WebEquity, a leading provider of cloud-based loan origination solutions for f inancial institutions. WebEquity is part of the MA reportable segment and its revenue is included in the ERS LOB. In October 2014, the Company acquired Lewtan, a leading provider of analytical tools and data for the global structured finance market. Lewta n is part of the MA reportable segment and its revenue is included in the RD&A LOB. Revenue for MIS and expenses for MA include an intersegment royalty charged to MA for the rights to use and distribute content, data and products developed by MIS. The roy alty rate charged by MIS approximates the fair value of the aforementioned content, data and products and is generally based on comparable market transactions. Also, revenue for MA and expenses for MIS include an intersegment fee charged to MIS from MA for certain MA products and services utilized in MIS’s ratings process. These fees charged by MA are generally equal to the costs incurred by MA to produce these products and services. Additionally, overhead costs and corporate expenses of the Company that ex clusively benefit only one segment are fully charged to that segment. Overhead costs and corporate expenses of the Company that benefit both segments are allocated to each segment based on a revenue-split methodology. Accordingly, a reportable segment’s sh are of these costs will increase as its proportion of revenue relative to Moody’s total revenue increases. Overhead expenses include costs such as rent and occupancy, information technology and support staff such as finance, human resources and information technology. “Eliminations” in the table below represent intersegment revenue/expense. Moody’s does not report the Company’s assets by reportable segment, as this metric is not used by the chief operating decision maker to allocate resources to the segment s. Consequently, it is not practical to show assets by reportable segment. FINANCIAL INFORMATION BY SEGMENT: The table below shows revenue, Adjusted Operating Income and operating income by reportable segment. Adjusted Operating Income is a financial metric utilized by the Company’s chief operating decision maker to assess the profitability of each reportable segment. Year Ended December 31, 2015 2014 MIS MA Eliminations Consolidated MIS MA Eliminations Consolidated Revenue $ 2,427.7 $ 1,163.4 $ (106.6) $ 3,484.5 $ 2,353.4 $ 1,081.8 $ (100.9) $ 3,334.3 Operating, SG&A 1,120.3 883.9 (106.6) 1,897.6 1,076.2 824.3 (100.9) 1,799.6 Adjusted Operating Income 1,307.4 279.5 - 1,586.9 1,277.2 257.5 - 1,534.7 Less: Depreciation and amortization 66.0 47.5 - 113.5 49.4 46.2 - 95.6 Operating income $ 1,241.4 $ 232.0 $ - $ 1,473.4 $ 1,227.8 $ 211.3 $ - $ 1,439.1 Year Ended December 31, 2013 MIS MA Eliminations Consolidated Revenue $ 2,150.2 $ 913.3 $ (91.0) $ 2,972.5 Operating, SG&A 1,034.0 701.5 (91.0) 1,644.5 Adjusted Operating Income 1,116.2 211.8 - 1,328.0 Less: Depreciation and amortization 46.7 46.7 - 93.4 Operating income $ 1,069.5 $ 165.1 $ - $ 1,234.6 MIS AND MA REVENUE BY LINE OF BUSINESS The tables below present revenue b y LOB : Year Ended December 31, 2015 2014 2013 MIS: Corporate finance (CFG) $ 1,112.7 $ 1,109.3 $ 996.8 Structured finance (SFG) 449.1 426.5 382.5 Financial institutions (FIG) 365.6 354.7 338.8 Public, project and infrastructure finance (PPIF) 376.4 357.3 341.3 Total ratings revenue 2,303.8 2,247.8 2,059.4 MIS Other 30.4 18.0 12.2 Total external revenue 2,334.2 2,265.8 2,071.6 Intersegment royalty 93.5 87.6 78.6 Total 2,427.7 2,353.4 2,150.2 MA: Research, data and analytics (RD&A) 626.4 571.8 519.8 Enterprise risk solutions (ERS) 374.0 328.5 262.5 Professional services (PS) 149.9 168.2 118.6 Total external revenue 1,150.3 1,068.5 900.9 Intersegment revenue 13.1 13.3 12.4 Total 1,163.4 1,081.8 913.3 Eliminations (106.6) (100.9) (91.0) Total MCO $ 3,484.5 $ 3,334.3 $ 2,972.5 Year Ended December 31, 2015 2014 2013 Revenue: U.S. $ 2,009.0 $ 1,814.5 $ 1,626.5 International: EMEA 882.3 952.8 862.8 Asia-Pacific 364.2 338.3 286.1 Americas 229.0 228.7 197.1 Total International 1,475.5 1,519.8 1,346.0 Total $ 3,484.5 $ 3,334.3 $ 2,972.5 Long-lived assets at December 31: United States $ 657.5 $ 657.6 $ 552.3 International 924.3 1,011.3 613.2 Total $ 1,581.8 $ 1,668.9 $ 1,165.5 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Information by Segment | Year Ended December 31, 2015 2014 MIS MA Eliminations Consolidated MIS MA Eliminations Consolidated Revenue $ 2,427.7 $ 1,163.4 $ (106.6) $ 3,484.5 $ 2,353.4 $ 1,081.8 $ (100.9) $ 3,334.3 Operating, SG&A 1,120.3 883.9 (106.6) 1,897.6 1,076.2 824.3 (100.9) 1,799.6 Adjusted Operating Income 1,307.4 279.5 - 1,586.9 1,277.2 257.5 - 1,534.7 Less: Depreciation and amortization 66.0 47.5 - 113.5 49.4 46.2 - 95.6 Operating income $ 1,241.4 $ 232.0 $ - $ 1,473.4 $ 1,227.8 $ 211.3 $ - $ 1,439.1 Year Ended December 31, 2013 MIS MA Eliminations Consolidated Revenue $ 2,150.2 $ 913.3 $ (91.0) $ 2,972.5 Operating, SG&A 1,034.0 701.5 (91.0) 1,644.5 Adjusted Operating Income 1,116.2 211.8 - 1,328.0 Less: Depreciation and amortization 46.7 46.7 - 93.4 Operating income $ 1,069.5 $ 165.1 $ - $ 1,234.6 |
Revenue by Line of Business within Each Rreportable Segment | Year Ended December 31, 2015 2014 2013 MIS: Corporate finance (CFG) $ 1,112.7 $ 1,109.3 $ 996.8 Structured finance (SFG) 449.1 426.5 382.5 Financial institutions (FIG) 365.6 354.7 338.8 Public, project and infrastructure finance (PPIF) 376.4 357.3 341.3 Total ratings revenue 2,303.8 2,247.8 2,059.4 MIS Other 30.4 18.0 12.2 Total external revenue 2,334.2 2,265.8 2,071.6 Intersegment royalty 93.5 87.6 78.6 Total 2,427.7 2,353.4 2,150.2 MA: Research, data and analytics (RD&A) 626.4 571.8 519.8 Enterprise risk solutions (ERS) 374.0 328.5 262.5 Professional services (PS) 149.9 168.2 118.6 Total external revenue 1,150.3 1,068.5 900.9 Intersegment revenue 13.1 13.3 12.4 Total 1,163.4 1,081.8 913.3 Eliminations (106.6) (100.9) (91.0) Total MCO $ 3,484.5 $ 3,334.3 $ 2,972.5 |
Consolidated Revenue and Long-Lived Assets Information by Geographic Area | Year Ended December 31, 2015 2014 2013 Revenue: U.S. $ 2,009.0 $ 1,814.5 $ 1,626.5 International: EMEA 882.3 952.8 862.8 Asia-Pacific 364.2 338.3 286.1 Americas 229.0 228.7 197.1 Total International 1,475.5 1,519.8 1,346.0 Total $ 3,484.5 $ 3,334.3 $ 2,972.5 Long-lived assets at December 31: United States $ 657.5 $ 657.6 $ 552.3 International 924.3 1,011.3 613.2 Total $ 1,581.8 $ 1,668.9 $ 1,165.5 |
Financial Information by Segmen
Financial Information by Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||
Revenue | $ 865.9 | $ 834.9 | $ 918.1 | $ 865.6 | $ 3,484.5 | $ 3,334.3 | $ 2,972.5 |
Operating, SG&A | 1,897.6 | 1,799.6 | 1,644.5 | ||||
Adjusted Operating Income | 1,586.9 | 1,534.7 | 1,328 | ||||
Depreciation and amortization | 113.5 | 95.6 | 93.4 | ||||
Operating income | $ 333.1 | $ 349.7 | $ 419.3 | $ 371.3 | 1,473.4 | 1,439.1 | 1,234.6 |
MIS [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 2,427.7 | 2,353.4 | 2,150.2 | ||||
Operating, SG&A | 1,120.3 | 1,076.2 | 1,034 | ||||
Adjusted Operating Income | 1,307.4 | 1,277.2 | 1,116.2 | ||||
Depreciation and amortization | 66 | 49.4 | 46.7 | ||||
Operating income | 1,241.4 | 1,227.8 | 1,069.5 | ||||
MA [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 1,163.4 | 1,081.8 | 913.3 | ||||
Operating, SG&A | 883.9 | 824.3 | 701.5 | ||||
Adjusted Operating Income | 279.5 | 257.5 | 211.8 | ||||
Depreciation and amortization | 47.5 | 46.2 | 46.7 | ||||
Operating income | 232 | 211.3 | 165.1 | ||||
Eliminations [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | (106.6) | (100.9) | (91) | ||||
Operating, SG&A | $ (106.6) | $ (100.9) | $ (91) |
Revenue by Line of Business (De
Revenue by Line of Business (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||
Revenue | $ 865.9 | $ 834.9 | $ 918.1 | $ 865.6 | $ 3,484.5 | $ 3,334.3 | $ 2,972.5 |
MIS [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 2,427.7 | 2,353.4 | 2,150.2 | ||||
MIS [Member] | Corporate finance (CFG) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 1,112.7 | 1,109.3 | 996.8 | ||||
MIS [Member] | Structured Finance (SFG) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 449.1 | 426.5 | 382.5 | ||||
MIS [Member] | Financial Institutions (FIG) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 365.6 | 354.7 | 338.8 | ||||
MIS [Member] | Public, Project And Infrastructure Finance (PPIF) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 376.4 | 357.3 | 341.3 | ||||
MIS [Member] | Rating Revenue [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 2,303.8 | 2,247.8 | 2,059.4 | ||||
MIS [Member] | MIS Other [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 30.4 | 18 | 12.2 | ||||
MIS [Member] | External Revenues [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 2,334.2 | 2,265.8 | 2,071.6 | ||||
MIS [Member] | Intersegment Revenue/Royality [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 93.5 | 87.6 | 78.6 | ||||
MA [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 1,163.4 | 1,081.8 | 913.3 | ||||
MA [Member] | Research, Data And Analytics (RD&A) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 626.4 | 571.8 | 519.8 | ||||
MA [Member] | Enterprise Risk Solutions (ERS) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 374 | 328.5 | 262.5 | ||||
MA [Member] | Professional Services (PS) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 149.9 | 168.2 | 118.6 | ||||
MA [Member] | External Revenues [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 1,150.3 | 1,068.5 | 900.9 | ||||
MA [Member] | Intersegment Revenue/Royality [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 13.1 | 13.3 | 12.4 | ||||
Eliminations [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | $ (106.6) | $ (100.9) | $ (91) |
Consolidated Revenue and Long-L
Consolidated Revenue and Long-Lived Assets Information by Geographic Area (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||
Revenue | $ 865.9 | $ 834.9 | $ 918.1 | $ 865.6 | $ 3,484.5 | $ 3,334.3 | $ 2,972.5 |
Long-lived assets at December 31 | 1,581.8 | 1,581.8 | 1,668.9 | 1,165.5 | |||
United States | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 2,009 | 1,814.5 | 1,626.5 | ||||
Long-lived assets at December 31 | 657.5 | 657.5 | 657.6 | 552.3 | |||
International | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 1,475.5 | 1,519.8 | 1,346 | ||||
Long-lived assets at December 31 | $ 924.3 | 924.3 | 1,011.3 | 613.2 | |||
International | Europe Middle East And Africa (EMEA) [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 882.3 | 952.8 | 862.8 | ||||
International | Americas [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 229 | 228.7 | 197.1 | ||||
International | Asia Pacific [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | $ 364.2 | $ 338.3 | $ 286.1 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure Segment Information Additional Information [Abstract] | |
Number of reportable segments | 2 |
Number of operating segments | 3 |
VALUATION AND QUALIFYING ACCOUN
VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2015 | |
VALUATION AND QUALIFYING ACCOUNTS | NOTE 20 VALUATION AND QUALIFYING ACCOUNTS Accounts receivable allowances primarily represent adjustments to customer billings that are estimated when the related revenue is recognized and also represents an estimate for uncollectible accounts . The valuation allowance on deferred tax assets relates to foreign net operating losses for which realization is uncertain. Below is a summary of activity for both allowances : Year Ended December 31, Balance at Beginning of the Year Charged to costs and expenses Deductions Balance at End of the Year 2015 Accounts receivable allowance $ (29.4) $ (9.0) $ 10.9 $ (27.5) Deferred tax assets - valuation allowance $ (6.9) $ 2.4 $ 0.2 $ (4.3) 2014 Accounts receivable allowance $ (28.9) $ (8.9) $ 8.4 $ (29.4) Deferred tax assets - valuation allowance $ (8.4) $ 0.5 $ 1.0 $ (6.9) 2013 Accounts receivable allowance $ (29.1) $ (8.0) $ 8.2 $ (28.9) Deferred tax assets - valuation allowance $ (15.2) $ 4.7 $ 2.1 $ (8.4) |
VALUATION AND QUALIFYING ACC122
VALUATION AND QUALIFYING ACCOUNTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Activity for Valuation Allowances | Year Ended December 31, Balance at Beginning of the Year Charged to costs and expenses Deductions Balance at End of the Year 2015 Accounts receivable allowance $ (29.4) $ (9.0) $ 10.9 $ (27.5) Deferred tax assets - valuation allowance $ (6.9) $ 2.4 $ 0.2 $ (4.3) 2014 Accounts receivable allowance $ (28.9) $ (8.9) $ 8.4 $ (29.4) Deferred tax assets - valuation allowance $ (8.4) $ 0.5 $ 1.0 $ (6.9) 2013 Accounts receivable allowance $ (29.1) $ (8.0) $ 8.2 $ (28.9) Deferred tax assets - valuation allowance $ (15.2) $ 4.7 $ 2.1 $ (8.4) |
Summary of Activity for Valuati
Summary of Activity for Valuation Allowances (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Valuation And Qualifying Accounts Disclosure [Line Items] | |||
Beginning balance, Accounts receivable allowance | $ (29.4) | $ (28.9) | $ (29.1) |
Additions, Accounts receivable allowance | (9) | (8.9) | (8) |
Write-offs and Adjustments, Accounts receivable allowance | 10.9 | 8.4 | 8.2 |
Ending balance, Accounts receivable allowance | (27.5) | (29.4) | (28.9) |
Beginning balance, Deferred tax assets valuation allowance | 6.9 | (8.4) | (15.2) |
Additions, Deferred tax assets valuation allowance | 2.4 | 0.5 | 4.7 |
Write-offs and Adjustments, Deferred tax assets valuation allowance | 0.2 | 1 | 2.1 |
Ending balance, Deferred tax assets valuation allowance | $ 4.3 | $ 6.9 | $ (8.4) |
OTHER NON-OPERATING INCOME, NET
OTHER NON-OPERATING INCOME, NET | 12 Months Ended |
Dec. 31, 2015 | |
OTHER NON-OPERATING INCOME (EXPENSE), NET | NOTE 21 OTHER NON-OPERATING INCOME , NET The following table summarizes the components of other non-operating income (expense), net as presented in the consolidated statements of operations: Year Ended December 31, 2015 2014 2013 FX gain (a) $ 1.1 $ 20.3 $ - Legacy Tax (b) 6.4 6.4 19.2 Joint venture income 11.8 9.6 8.8 Other 2.0 (0.4) (1.5) Total $ 21.3 $ 35.9 $ 26.5 (a) The FX gain in 2014 reflects the U.S. dollar strengthening against the euro and GBP for U.S. dollar denominated assets held by the Company's international subsidaries. (b) The 2015 and 2014 amount relate to the expiration of a statute of limitations for Legacy Tax Matters. The 2013 amount represents a reversal relating to favorable resolution of a Legacy Tax Matter for the 2007-2009 tax years. |
OTHER NON-OPERATING INCOME, 125
OTHER NON-OPERATING INCOME, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Components of Other Non-Operating Income (Expense) | Year Ended December 31, 2015 2014 2013 FX gain (a) $ 1.1 $ 20.3 $ - Legacy Tax (b) 6.4 6.4 19.2 Joint venture income 11.8 9.6 8.8 Other 2.0 (0.4) (1.5) Total $ 21.3 $ 35.9 $ 26.5 (a) The FX gain in 2014 reflects the U.S. dollar strengthening against the euro and GBP for U.S. dollar denominated assets held by the Company's international subsidaries. (b) The 2015 and 2014 amount relate to the expiration of a statute of limitations for Legacy Tax Matters. The 2013 amount represents a reversal relating to favorable resolution of a Legacy Tax Matter for the 2007-2009 tax years. |
Components of Other Non-Operati
Components of Other Non-Operating Income (Expense), Net (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Component Of Other Expense Income Nonoperating [Line Items] | |||
FX gain (loss) | $ 1.1 | $ 20.3 | |
Legacy tax benefit | 6.4 | 6.4 | $ 19.2 |
Joint venture income | 11.8 | 9.6 | 8.8 |
Other | 2 | (0.4) | (1.5) |
Other non-operating income (expense), net | $ 21.3 | $ 35.9 | $ 26.5 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2015 | |
RELATED PARTY TRANSACTIONS | NOTE 22 RELATED PARTY TRANSACTIONS Moody’ s Corporation made grants of $ 4 million and $ 8 million to The Moody’s Foundation during the years ended December 31, 2014 and 2013 , respectively. The Company did not make a grant to the Foundation in 2015. The Foundation carries out philanthropic activities primarily in the areas of education and health and human services. Certain members of Moody’s senior management are on the board of the Foundation. |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | ||
Grants made by Moody's Corporation | $ 4 | $ 8 |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2015 | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | NOTE 23 QUARTE RLY FINANCIAL DATA (UNAUDITED) Three Months Ended (amounts in millions, except EPS) March 31 June 30 September 30 December 31 2015 Revenue $ 865.6 $ 918.1 $ 834.9 $ 865.9 Operating Income $ 371.3 $ 419.3 $ 349.7 $ 333.1 Net income attributable to Moody's $ 230.1 $ 261.7 $ 231.6 $ 217.9 EPS: Basic $ 1.14 $ 1.30 $ 1.16 $ 1.11 Diluted $ 1.11 $ 1.28 $ 1.14 $ 1.09 2014 Revenue $ 767.2 $ 873.5 $ 816.1 $ 877.5 Operating income $ 333.0 $ 411.7 $ 349.7 $ 344.7 Net income attributable to Moody's $ 218.0 $ 319.2 $ 215.2 $ 236.3 EPS: Basic $ 1.02 $ 1.51 $ 1.02 $ 1.14 Diluted $ 1.00 $ 1.48 $ 1.00 $ 1.12 Basic and diluted EPS are computed for each of the periods presented. The number of weighted average shares outstanding changes as common shares are is sued pursuant to employee stock-based compensation plans and for other purposes or as shares are repurchased. Therefore, the sum of basic and diluted EPS for each of the four quarters may not equal the full year basic and diluted EPS. Additionally, t he qua rterly financial data includes the ICRA Gain in the three months ended June 30, 2014. There were benefits of $ 6.4 million to net income related to the resolution of Lega cy Tax Matters for both the three months ended September 30, 2015 and 2014. |
QUARTERLY FINANCIAL DATA (UN130
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data | Three Months Ended (amounts in millions, except EPS) March 31 June 30 September 30 December 31 2015 Revenue $ 865.6 $ 918.1 $ 834.9 $ 865.9 Operating Income $ 371.3 $ 419.3 $ 349.7 $ 333.1 Net income attributable to Moody's $ 230.1 $ 261.7 $ 231.6 $ 217.9 EPS: Basic $ 1.14 $ 1.30 $ 1.16 $ 1.11 Diluted $ 1.11 $ 1.28 $ 1.14 $ 1.09 2014 Revenue $ 767.2 $ 873.5 $ 816.1 $ 877.5 Operating income $ 333.0 $ 411.7 $ 349.7 $ 344.7 Net income attributable to Moody's $ 218.0 $ 319.2 $ 215.2 $ 236.3 EPS: Basic $ 1.02 $ 1.51 $ 1.02 $ 1.14 Diluted $ 1.00 $ 1.48 $ 1.00 $ 1.12 |
Quarterly Financial Data (Detai
Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Data [Line Items] | |||||||
Revenue | $ 865.9 | $ 834.9 | $ 918.1 | $ 865.6 | $ 3,484.5 | $ 3,334.3 | $ 2,972.5 |
Operating Income | 333.1 | 349.7 | 419.3 | 371.3 | 1,473.4 | 1,439.1 | 1,234.6 |
Net income attributable to Moody's | $ 217.9 | $ 231.6 | $ 261.7 | $ 230.1 | $ 941.3 | $ 988.7 | $ 804.5 |
Basic | $ 1.11 | $ 1.16 | $ 1.3 | $ 1.14 | $ 4.7 | $ 4.69 | $ 3.67 |
Diluted | $ 1.09 | $ 1.14 | $ 1.28 | $ 1.11 | $ 4.63 | $ 4.61 | $ 3.6 |
Quarterly Financial Data - Addi
Quarterly Financial Data - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Quarterly Financial Data [Line Items] | ||
Benefit to net income related to the resolution of legacy tax matters | $ 6.4 | $ 6.4 |