Document and Entity Information
Document and Entity Information shares in Millions | 3 Months Ended |
Mar. 31, 2017shares | |
Document Information [Line Items] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Mar. 31, 2017 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | Q1 |
Trading Symbol | MCO |
Entity Registrant Name | MOODYS CORP /DE/ |
Entity Central Index Key | 1,059,556 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 191.3 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues | $ 975.2 | $ 816.1 |
Expenses | ||
Operating | 277.4 | 249.2 |
Selling, general and administrative | 221.9 | 232.9 |
Depreciation and amortization | 32.5 | 29.9 |
Total expenses | 531.8 | 512 |
Operating Income | 443.4 | 304.1 |
Non-operating (expense) income, net | ||
Interest income (expense), net | (42.4) | (34.1) |
Other non-operating income (expense), net | (9.4) | 5.6 |
CCXI gains | 59.7 | |
Total non-operating (expense) income, net | 7.9 | (28.5) |
Income before provisions for income taxes | 451.3 | 275.6 |
Provision for income taxes | 105.4 | 89 |
Net income | 345.9 | 186.6 |
Less: Net income attributable to noncontrolling interests | 0.3 | 2.2 |
Net income attributable to Moody's | $ 345.6 | $ 184.4 |
Earnings per share attributable to Moody's common shareholders | ||
Basic | $ 1.81 | $ 0.95 |
Diluted | $ 1.78 | $ 0.93 |
Weighted average number of shares outstanding | ||
Basic | 191.1 | 195 |
Diluted | 194.3 | 197.9 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Net income | $ 345.9 | $ 186.6 |
Foreign currency translation: | ||
Foreign currency translation adjustments - Pre Tax | 14.4 | 48.5 |
Foreign currency translation adjustment - Tax | (2.3) | (12.5) |
Foreign currency translation adjustments - Net of Tax | 12.1 | 36 |
Cash flow hedges: | ||
Net realized and unrealized gain (loss) on cash flow hedges - Pre Tax | (0.3) | 2 |
Net realized and unrealized gain (loss) on cash flow hedges - Tax Amount | 0.1 | (0.8) |
Net realized and unrealized gain (loss) on cash flow hedges - Net of Tax | (0.2) | 1.2 |
Reclassification of losses included in net income - Pre Tax | (1.4) | (2.2) |
Reclassification of losses included in net income - Tax Amount | 0.5 | 0.8 |
Reclassification of losses included in net income- Net of Tax | (0.9) | (1.4) |
Available for sale securities: | ||
Net unrealized gains on available for sale securities - Pre Tax | 0.5 | 0.6 |
Net unrealized gains on available for sale securities - Net of Tax | 0.5 | 0.6 |
Pension and Other Retirement Benefits: | ||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | 2.4 | 2.6 |
Amortization of actuarial losses and prior service costs included in net income - Tax | (0.9) | (1) |
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | 1.5 | 1.6 |
Total other comprehensive income (loss) - Pre Tax | 15.6 | 51.5 |
Total other comprehensive income (loss) - Tax | (2.6) | (13.5) |
Total other comprehensive income (loss) - Net of Tax | 13 | 38 |
Comprehensive income | 358.9 | 224.6 |
Less: Comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interest | 5.7 | 2.2 |
Comprehensive income attributable to Moody's | $ 353.2 | $ 222.4 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 2,129.6 | $ 2,051.5 |
Short-term investments | 132.8 | 173.4 |
Accounts receivable, net of allowances of net of allowances of $25.1 in 2017 and $25.7 in 2016 | 953.5 | 887.4 |
Other current assets | 269.6 | 140.8 |
Total current assets | 3,485.5 | 3,253.1 |
Property and equipment, net of accumulated depreciation of $620.5 in 2017 and $595.5 in 2016 | 329.1 | 325.9 |
Goodwill | 1,029.6 | 1,023.6 |
Intangible assets, net | 289.8 | 296.4 |
Deferred tax assets, net | 135.1 | 316.1 |
Other assets | 166.8 | 112.2 |
Total assets | 5,435.9 | 5,327.3 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 392.6 | 1,444.3 |
Commercial paper | 213.8 | |
Current portion of long-term debt | 300 | |
Deferred revenue | 817.4 | 683.9 |
Total current liabilities | 1,423.8 | 2,428.2 |
Non-current portion of deferred revenue | 132.5 | 134.1 |
Long-term debt | 3,861.9 | 3,063 |
Deferred tax liabilities, net | 105 | 104.3 |
Unrecognized tax benefits | 202.7 | 199.8 |
Other liabilities | 434.2 | 425.2 |
Total liabilities | 6,160.1 | 6,354.6 |
Contingencies (Note 14) | ||
Shareholders' (deficit) equity | ||
Capital surplus | 447 | 477.2 |
Retained earnings | 7,031 | 6,688.9 |
Treasury stock, at cost; 151,594,546 and 152,208,231 shares of common stock at March 31, 2017 and December 31, 2016, respectively | (8,051.2) | (8,029.6) |
Accumulated other comprehensive loss | (357.3) | (364.9) |
Total Moody's shareholders' deficit | (927.1) | (1,225) |
Noncontrolling interests | 202.9 | 197.7 |
Total shareholders' deficit | (724.2) | (1,027.3) |
Total liabilities and shareholders' (deficit) equity | 5,435.9 | 5,327.3 |
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 | Mar. 31, 2017 | Dec. 31, 2016 |
Accounts receivable, allowances | $ 25.1 | $ 25.7 |
Property and equipment, accumulated depreciation | $ 620.5 | $ 595.5 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Treasury stock, shares | 151,594,546 | 152,208,231 |
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 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities | ||
Net income | $ 345.9 | $ 186.6 |
Reconciliation of net income to net cash provided by operating activities: | ||
Depreciation and amortization | 32.5 | 29.9 |
Stock-based compensation expense | 28.4 | 25.4 |
CCXI gains | (59.7) | |
Deferred income taxes | 185 | 11.3 |
Changes in assets and liabilities: | ||
Accounts receivable | (61.9) | (45.5) |
Other current assets | (128.3) | 13.6 |
Other assets | (3.2) | 1.5 |
Accounts payable and accrued liabilities | (988.6) | (99) |
Deferred revenue | 125.9 | 122.6 |
Unrecognized tax benefits and other non-current tax liabilities | 0.9 | 5.3 |
Other liabilities | 10.7 | 1.9 |
Net cash provided by operating activities | (512.4) | 253.6 |
Cash flows from investing activities | ||
Capital additions | (18.7) | (26.3) |
Purchases of investments | (34.5) | (134.6) |
Sales and maturities of short-term investments | 76.8 | 126.1 |
Cash paid for acquisitions, net of cash acquired and equity investments | (5) | (75.9) |
Receipts from settlements of net investment hedges | 2.3 | |
Net cash used in investing activities | 18.6 | (108.4) |
Cash flows from financing activities | ||
Issuance of notes | 798.5 | |
Repayments of notes | (300) | |
Issuance of commercial paper | 653.7 | |
Repayments of commercial paper | (440.4) | |
Proceeds from stock-based compensation plans | 22.1 | 24.3 |
Repurchase of shares related to stock-based compensation | (47.5) | (42.7) |
Cost of treasury shares repurchased | (55) | (262.1) |
Dividends | (72.6) | (72.1) |
Dividends to noncontrolling interests | (0.2) | (2.9) |
Debt issuance costs and related fees | (4.9) | |
Net cash provided (used in) by financing activities | 553.7 | (355.5) |
Effect of exchange rate changes on cash and cash equivalents | 18.2 | 29 |
Net increase (decrease) in cash and cash equivalents | 78.1 | (181.3) |
Cash and cash equivalents, beginning of the period | 2,051.5 | 1,757.4 |
Cash and cash equivalents, end of the period | $ 2,129.6 | $ 1,576.1 |
GLOSSARY OF TERMS AND ABBREVIAT
GLOSSARY OF TERMS AND ABBREVIATIONS | 3 Months Ended |
Mar. 31, 2017 | |
GLOSSARY OF TERMS AND ABBREVIATIONS | GLOSSARY OF TERMS AND ABBREVIATIONS The following terms, abbreviations and acronyms are used to identify frequently used terms in this report: TERM DEFINITION Adjusted Free Cash Flow Free Cash Flow minus payments for Settlement Charge Adjusted Operating Income Operating income excluding depreciation and amortization Adjusted Operating Margin Adjusted Operating Income divided by revenue Americas Represents countries within North and South America, excluding the U.S. AOCI Accumulated other comprehensive income (loss); a separate component of shareholders’ (deficit) equity 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 including but not limited to: Australia, China, India, Indonesia, Japan, Korea, Malaysia, Singapore, Sri Lanka and Thailand ASU The FASB Accounting Standards Update 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 Board The board of directors of the Company BPS Basis points CCXCM China Cheng Xin Credit Management Co. Ltd.; the majority shareholder of CCXI CCXI China Cheng Xin International Credit Rating Co. Ltd.; China’s first and largest domestic credit rating agency approved by the People's Bank of China; the Company acquired a 49% interest in 2006; currently Moody’s owns 30% of CCXI. CCXI Gain In the first quarter of 2017, CCXI, as part of a strategic business realignment, issued additional capital to CCXCM in exchange for the entire CCXR business owned 100% by CCXCM. CCXR is a Chinese credit rating agency licensed in China to rate certain financial instruments. The capital issuance in exchange for CCXR business diluted Moody’s ownership interest in CCXI to 30%. This resulted in a $59.7 million non-cash gain which is not taxable. CLO Collateralized loan obligation CMBS Commercial mortgage-backed securities; part of the CREF asset class within SFG 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 research and analytical services to institutional investors Copal Amba Operating segment (rebranded as MAKS in 2016) created in January 2014 that consists of all operations from Copal and Amba. Part of the PS LOB within the MA reportable segment. Also a reporting unit. Council Council of the European Union CP Commercial Paper CP Notes Unsecured commercial paper issued under the CP Program CP Program A program entered into on August 3, 2016 allowing the Company to privately place CP up to a maximum of $1 billion for which the maturity may not exceed 397 from the date of issue CRAs Credit rating agencies CRA3 Regulation (EU) 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 CDOs and mortgage-backed securities; part of SFG D&A Depreciation and amortization D&B Business Old D&B’s Dun & Bradstreet operating company DBPP Defined benefit pension plans Debt/EBITDA Ratio of Total Debt to EBITDA EBITDA Earnings before interest, taxes, depreciation and amortization EMEA Represents countries within Europe, the Middle East and Africa EPS Earnings per share ERS The enterprise risk solutions LOB within MA, which offers risk management software products as well as software implementation services and related risk management advisory engagements ESMA European Securities and Markets Authority ETR Effective tax rate EU European Union EUR Euros Excess Tax Benefits 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 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 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; part of the PS LOB and a reporting unit within the MA reportable segment; consists of on-line and classroom-based training services and CSI Global Education, Inc. FX Foreign exchange GAAP U.S. Generally Accepted Accounting Principles GBP British pounds GGY Gilliland Gold Young; a leading provider of advanced actuarial software for the global insurance industry. The Company acquired GGY on March 1, 2016; part of the ERS LOB and reporting unit within the MA reportable segment 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 ICTEAS ICRA Techno Analytics; formerly a wholly-owned subsidiary of ICRA; divested by ICRA in the fourth quarter of 2016 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 leading Korean provider of fixed income securities pricing and consolidated subsidiary of the Company Legacy Tax Matter(s) Exposures to certain potential tax liabilities assumed in connection with the Company’s spin-off from Dun & Bradstreet in 2000 LIBOR London Interbank Offered Rate LOB Line of business M&A Mergers and acquisitions 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; consists of three LOBs – RD&A, ERS and PS Make Whole Amount The prepayment penalty amount 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 2015 Senior Notes which is a premium based on the excess, if any, of the discounted value of the remaining scheduled payments over the prepaid principal MAKS Moody’s Analytics Knowledge Services; operating segment and reporting unit formerly known as Copal Amba; provides offshore research and analytic services to the global financial and corporate sectors; part of the PS LOB and a reporting unit within the MA reportable segment 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; MIS Other is an LOB of MIS Moody’s Moody’s Corporation and its subsidiaries; MCO; the Company Net Income Net income attributable to Moody’s Corporation, which excludes net income from consolidated noncontrolling interests belonging to the minority interest holder NM Percentage change is not meaningful 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 NRSRO Nationally Recognized Statistical Rating Organization OCI Other comprehensive income (loss); includes gains and losses on cash flow and net investment hedges, unrealized gains and losses on available for sale securities, certain gains and losses relating to pension and other retirement benefit obligations and foreign currency translation adjustments Other Retirement Plan 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 PS Professional Services, an LOB within MA consisting of MAKS and FSTC that provides 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 Reform Act Credit Rating Agency Reform Act of 2006 REIT Real Estate Investment Trust Relationship Revenue For MIS represents 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 license and maintenance revenue Retirement Plans Moody’s funded and unfunded pension plans, the healthcare plans and life insurance plans SCDM SCDM Financial, a leading provider of analytical tools for participants in securitization markets. Moody’s acquired SCDM’s structured finance data and analytics business in February 2017 U.S. Securities and Exchange Commission SEC Securities Act Securities Act of 1933, as amended Series 2007-1 Notes Principal amount of $300 million, 6.06% senior unsecured notes due in September 2017 pursuant to the 2007 Agreement; prepaid in March 2017 SFG Structured finance group; an LOB of MIS SG&A Selling, general and administrative expenses Total Debt All indebtedness of the Company as reflected on the consolidated balance sheets 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 as well as data services, research and analytical engagements. For MA, represents software license fees and revenue from risk management advisory projects, training and certification services, and research and analytical engagements U.K. United Kingdom U.S. United States USD U.S. dollar UTBs Unrecognized tax benefits UTPs Uncertain tax positions VSOE Vendor specific objective evidence; as defined in the ASC, evidence 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 2000 Distribution The distribution by Old D&B to its shareholders of all the outstanding shares of New D&B common stock on September 30, 2000 2007 Agreement Note purchase agreement dated September 7, 2007, relating to the Series 2007-1 Notes 2010 Indenture Supplemental indenture and related agreements dated August 19, 2010, relating to the 2010 Senior Notes 2010 Senior Notes Principal amount of $500 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 the $500 million, 4.875% senior unsecured notes due in February 2024 pursuant to the 2013 Indenture 2014 Indenture Supplemental indenture and related agreements dated July 16, 2014, relating to the 2014 Senior Notes 2017 Indenture Supplemental indenture and related agreements dated March 2, 2017, relating to the 2017 Floating Rate Senior Notes and 2017 Senior Notes 2014 Senior Notes (5-Year) Principal amount of $450 million, 2.75% senior unsecured notes due in July 2019 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 2017 Floating Rate Senior Notes Principal amount of $300 million, floating rate senior unsecured notes due in September 2018 2017 Senior Notes Principal amount of $500 million, 2.75% senior unsecured notes due in December 2021 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2017 | |
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) re search and analytical services. Moody’s has two reportable segments: MIS and MA. MIS, the credit rating agency, publishes credit ratings on a wide range of debt obligations and the entities that issue such obligations in markets worldwide. Revenue is prima rily 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 distrib ution of research and financial instrument pricing services in the Asia-Pacific region as well as revenue from ICRA’s non-ratings operations. The revenue from these operations is included in the MIS Other LOB and is not material to the results of the MIS s egment. The MA segment develops a wide range of products and services that support financial analysis and risk management activities of institutional participants in global financial markets. Within its RD&A business, MA distributes research and data devel oped by MIS as part of its ratings process, including in-depth research on major debt issuers, industry studies and commentary on topical credit-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 business, MA provides software solutions as well as related risk management services. The PS business provides research and analytical services along with financial training and certification programs. These interim financial statements have been prepared in accordance with the instructions to Form 10-Q and should be read in conjunction with the Company’s consolidated financial statements and related notes in the Company’s 2016 annual report on Form 10-K filed with the SEC on February 24, 2017 . The results of interim periods are not necessarily indicative of results for the full year or any subsequent period. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation of financial position, results of operations and cash flows at the dates and for the periods presented have been included. The year-end consolidated balance sheet data was derived from audited financial statements, but doe s not include all disclosures required by accounting principles generally accepted in the United States of America. Certain reclassifications have been made to prior period amounts to conform to the current presentation. Adoption of New Accounting Standard In the first quarter of 2017, the Company adopted ASU No. 2016-09 “Improvements to Employee Share-Based Payment Accounting”. As required by ASU 2016-09, Excess Tax Benefits or shortfalls recognized on stock-based compensation expense are reflected in the consolidated statement of operations as a component of the provision for income taxes on a prospective basis. Prior to the adoption of this ASU, Excess Tax Benefits and shortfalls were recorded to capital surplus within shareholders’ deficit. The impact of this adoption was a $ 19.0 million benefit to the provision for income taxes for the three months ended March 31, 2017. Additionally, in accordance with this ASU, Excess Tax Benefits or shortfalls recognized on stock-based compensation are classified as o perating cash flows in the consolidated statement of cash flows, and the Company has applied this provision on a retrospective basis. Under previous accounting guidance, the Excess Tax Benefits or shortfalls were shown as a reduction to operating activity and an increase to financing activity. Furthermore, the Company has elected to continue to estimate the number of stock-based awards expected to vest, rather than accounting for award forfeitures as they occur, to determine the amount of stock-based compen sation cost recognized in each period. The impact to the Company’s statement of cash flows for the three months ended March 31, 2016 relating to the adoption of this provision of the ASU is set forth in the table below: (amounts in millions) As reported Three Months Ended March 31, 2016 Adoption Adjustment Three Months Ended March 31, 2016 As adjusted Net cash provided by operating activities $ 237.3 $ 16.3 $ 253.6 Net cash used in financing activities $ (339.2) $ (16.3) $ (355.5) |
DESCRIPTION OF BUSINESS AND BA9
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Schedule of Change in Balance Sheets Item Due to Adoption of Debt Issuance Costs Policy | (amounts in millions) As reported Three Months Ended March 31, 2016 Adoption Adjustment Three Months Ended March 31, 2016 As adjusted Net cash provided by operating activities $ 237.3 $ 16.3 $ 253.6 Net cash used in financing activities $ (339.2) $ (16.3) $ (355.5) |
Change in Financial Statement d
Change in Financial Statement due to adoption of Policy (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Item Effected [Line Items] | ||
Net cash provided by operating activities | $ (512.4) | $ 253.6 |
Net cash provided by financing activities | $ 553.7 | (355.5) |
As Previously Reported [Member] | ||
Item Effected [Line Items] | ||
Net cash provided by operating activities | 237.3 | |
Net cash provided by financing activities | $ (339.2) |
Description of Business and B11
Description of Business and Basis of Presentation - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Segment Reporting Information [Line Items] | |
Effect of Adoption Adjustment on Provision for income taxes | $ 19 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2017 | |
STOCK-BASED COMPENSATION | NOTE 2. STOCK-BASED COMPENSATION Presented below is a summary of the stock-based compensation cost and associated tax benefit included in the accompanying consolidated statements of operations: Three Months Ended March 31, 2017 2016 Stock-based compensation expense $ 28.4 $ 25.4 Tax benefit $ 9.1 $ 8.4 During the first three months of 2017 , th e Company granted 0.2 million employee stock options, which had a weighted av erage grant date fair value of $29.88 per share based on the Black-Scholes option-pricing model. The Company also granted 1.0 million shares of restricted stock in the first three months of 2017 , which had a weighted av erage grant date fair value of $113.32 per share . Both the employee stock options and restricted stock generally vest ratably over a four-year period. Additionally, the Company granted 0.2 million shares of performance-based awards whereby the number of shares that ultimately ve st are based on the achievement of certain non-market based performance metrics of the Company over a three-year period. The weighted average grant date fair value of these awards was $108.88 per share. The following weighted average assumptions were used in determining the fair value for options granted in 2017 : Expected dividend yield 1.34% Expected stock volatility 26.8% Risk-free interest rate 2.19% Expected holding period 6.5 years Grant date fair value $29.88 Unrecognized stock-based compensation expense at March 31, 2017 was $ 12.1 million and $ 200.7 million for stock options and unvested restricted stock, respectively, which is expected to be recognized over a weighted average period of 1.5 years and 1.8 years, respectively. Additionally, there was $ 27.7 million of unrecognized stock-based compensation expense relating to the aforementioned non-market based performance-based awards, which is expected to be recognized over a weighted average period of 1.2 years. The following tables summarize information relating to stock option exercises and restricted stock vesting: Three Months Ended March 31, Exercise of stock options: 2017 2016 Proceeds from stock option exercises $ 20.6 $ 22.8 Aggregate intrinsic value $ 21.6 $ 11.0 Tax benefit realized upon exercise $ 7.9 $ 3.9 Number of shares exercised 0.4 0.4 Three Months Ended March 31, Vesting of restricted stock: 2017 2016 Fair value of shares vested $ 106.8 $ 89.3 Tax benefit realized upon vesting $ 33.7 $ 29.5 Number of shares vested 0.9 1.0 Three Months Ended March 31, Vesting of performance-based restricted stock: 2017 2016 Fair value of shares vested $ 19.5 $ 23.6 Tax benefit realized upon vesting $ 6.9 $ 8.4 Number of shares vested 0.2 0.2 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Stock-Based Compensation Cost and Associated Tax Benefit | Three Months Ended March 31, 2017 2016 Stock-based compensation expense $ 28.4 $ 25.4 Tax benefit $ 9.1 $ 8.4 |
Weighted Average Assumptions used in Determining Fair Value for Options Granted | Expected dividend yield 1.34% Expected stock volatility 26.8% Risk-free interest rate 2.19% Expected holding period 6.5 years Grant date fair value $29.88 |
Stock Option Exercises and Restricted Stock Vesting | Three Months Ended March 31, Exercise of stock options: 2017 2016 Proceeds from stock option exercises $ 20.6 $ 22.8 Aggregate intrinsic value $ 21.6 $ 11.0 Tax benefit realized upon exercise $ 7.9 $ 3.9 Number of shares exercised 0.4 0.4 Three Months Ended March 31, Vesting of restricted stock: 2017 2016 Fair value of shares vested $ 106.8 $ 89.3 Tax benefit realized upon vesting $ 33.7 $ 29.5 Number of shares vested 0.9 1.0 Three Months Ended March 31, Vesting of performance-based restricted stock: 2017 2016 Fair value of shares vested $ 19.5 $ 23.6 Tax benefit realized upon vesting $ 6.9 $ 8.4 Number of shares vested 0.2 0.2 |
Stock-Based Compensation Cost a
Stock-Based Compensation Cost and Associated Tax Benefit (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Compensation Related Costs Share Based Payments Disclosure [Line Items] | ||
Stock-based compensation expense | $ 28.4 | $ 25.4 |
Tax benefit | $ 9.1 | $ 8.4 |
Weighted Average Assumptions us
Weighted Average Assumptions used in Determining Fair Value for Options Granted (Detail) | 3 Months Ended |
Mar. 31, 2017$ / shares | |
Schedule Of Weighted Average Assumptions For Fair Values Of Stock Options [Line Items] | |
Expected dividend yield | 1.34% |
Expected stock volatility | 26.80% |
Risk-free interest rate | 2.19% |
Expected holding period | 6 years 6 months |
Grant date fair value | $ 29.88 |
Stock Option Exercises and Rest
Stock Option Exercises and Restricted Stock Vesting (Detail) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Employee Stock Options [Member] | ||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | ||
Proceeds from stock option exercises | $ 20.6 | $ 22.8 |
Aggregate intrinsic value | 21.6 | 11 |
Tax benefit realized upon exercise/vesting | $ 7.9 | $ 3.9 |
Number of shares exercised | 0.4 | 0.4 |
Restricted Stock [Member] | ||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | ||
Fair value of shares vested | $ 106.8 | $ 89.3 |
Tax benefit realized upon exercise/vesting | $ 33.7 | $ 29.5 |
Number of shares vested | 0.2 | 1 |
Vesting of Performance Based Restricted Stock [Member] | ||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | ||
Fair value of shares vested | $ 19.5 | $ 23.6 |
Tax benefit realized upon exercise/vesting | $ 6.9 | $ 8.4 |
Number of shares vested | 0.2 | 0.2 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($)$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Employee stock options, weighted average grant date fair value | $ 29.88 |
Employee Stock Options [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Employee stock options, granted | shares | 0.2 |
Employee stock options, weighted average grant date fair value | $ 29.88 |
Other than options, award vesting period (in years) | 4 years |
Unrecognized compensation expense | $ | $ 12.1 |
Weighted average period to recognize expense | 1 year 6 months |
Restricted Stock [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Other than options, Shares granted | shares | 1 |
Other than options, weighted average grant date fair value | $ 113.32 |
Other than options, award vesting period (in years) | 4 years |
Unrecognized compensation expense | $ | $ 200.7 |
Weighted average period to recognize expense | 1 year 10 months 24 days |
Performance Based Restricted Stock [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Other than options, Shares granted | shares | 0.2 |
Other than options, weighted average grant date fair value | $ 108.88 |
Other than options, award vesting period (in years) | 3 years |
Unrecognized compensation expense | $ | $ 27.7 |
Weighted average period to recognize expense | 1 year 1 month 6 days |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2017 | |
INCOME TAXES | NOTE 3. INCOME TAXES Moody’s effective tax rate was 23.4% and 32.3% for the three months ended March 31, 2017 and 2016, respectively. The decrease in the ETR was primarily due to the impact of a benefit related to the adoption of ASU 2016-09, as further discussed in Note 1 above and the non-taxable CCXI Gain as discussed in Note 10 below. The Company classifies interest related to UTBs in interest expense, net in its consolidated statements of operations. Penalties, if incurred, would be recogni zed in other non-operating (expense) income, net. The Company had an increase in its UTBs of $ 2.9 million ($ 3.7 million net of federal tax) during the first quarter of 2017. Moody’s Corporation and subsidiaries are subject to U.S. federal income tax as we ll as income tax in various state, local and foreign jurisdictions. The Company’s U.S. federal income tax returns for the years 2011 and 2012 are under examination and its returns for 2013, 2014 and 2015 remain open to examination. The Company’s New York S tate tax returns for 2011 through 2014 are currently under examination and the Company’s New York City tax return for 2014 is currently under examination. The Company’s U.K. tax return for 2012 is currently under examination and its returns for 2013, 2014 and 2015 remain open to examination. For ongoing audits, it is possible the balance of UTBs could decrease in the next twelve months as a result of the settlement of these audits, which might involve the payment of additional taxes, the adjustment of certa in deferred taxes and/or the recognition of tax benefits. It is also possible that new issues might be raised by tax authorities which could necessitate increases to the balance of UTBs. As the Company is unable to predict the timing or outcome of these au dits, it is therefore unable to estimate the amount of changes to the balance of UTBs at this time. However, the Company believes that it has adequately provided for its financial exposure relating to all open tax years by tax jurisdiction in accordance wi th the applicable provisions of Topic 740 of the ASC regarding UTBs. On March 30, 2016, the FASB issu ed ASU No. 2016-09, “ Improvements to Employee Share Based Payment Accounting ” as more fully discussed in Note 1 to the condensed consolidated financial sta tements. The Company has adopted the new guidance as of the first quarter of 2017 and expects the adoption to result in a benefit to the provision for income taxes of approximately $30 million for the full year of 2017 , or $0.15 per diluted shares . In the first quarter of 2017, the Company adopted A S U No. 2016-16, “ Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory. ” Under previous guidance, the tax effects of intra-entity asset transfers (intercompany sales) were defe rred until the transferred asset was sold to a third party or otherwise recovered through use. The new guidance eliminates the exception for all intra-entity sales of assets other than inventory. Upon adoption, a cumulative-effect adjustment is recorded in retained earnings as of the beginning of the period of adoption. The net impact upon adoption is a reduction to retained earnings of $4.6 million. The Company does not expect any material impact on its future operations as a result of the adoption of this guidance. The following table shows the amount the Company paid for income taxes: Three Months Ended March 31, 2017 2016 Income taxes paid $ 23.4 $ 22.0 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Income Taxes Paid | Three Months Ended March 31, 2017 2016 Income taxes paid $ 23.4 $ 22.0 |
Income Taxes Paid (Detail)
Income Taxes Paid (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Taxes [Line Items] | ||
Income Taxes Paid | $ 23.4 | $ 22 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Tax Contingency [Line Items] | ||
Effective tax rate | 23.40% | 32.30% |
Overall increase (decrease) in unrecognized tax benefits (UTPs) | $ 0.9 | $ 5.3 |
Expected Benefit to Provision for income taxes for full-year 2017 due to change in accounting principle | $ 30 | |
Expected Change to the Per diluted shares for full-year 2017 due to change in accounting principle | $ 0.15 | |
Gross [Member] | ||
Income Tax Contingency [Line Items] | ||
Overall increase (decrease) in unrecognized tax benefits (UTPs) | $ 2.9 | |
Net of federal tax benefit [Member] | ||
Income Tax Contingency [Line Items] | ||
Overall increase (decrease) in unrecognized tax benefits (UTPs) | 3.7 | |
Retained Earnings [Member] | ||
Income Tax Contingency [Line Items] | ||
Effect of adoption adjustment Reduction to retained earnings | $ 4.6 |
WEIGHTED AVERAGE SHARES OUTSTAN
WEIGHTED AVERAGE SHARES OUTSTANDING | 3 Months Ended |
Mar. 31, 2017 | |
WEIGHTED AVERAGE SHARES OUTSTANDING | NOTE 4. WEIGHTED AVERAGE SHARES OUTSTANDING Below is a reconciliation of basic to diluted shares outstanding: Three Months Ended March 31, 2017 2016 Basic 191.1 195.0 Dilutive effect of shares issuable under stock-based compensation plans 3.2 2.9 Diluted 194.3 197.9 Anti-dilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock excluded from the table above 1.0 1.5 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 March 31, 2017 and 2016 . The assumed proceeds in 2017 do not include Excess Tax Benefits pursuant to the prospective adoption of ASU 2016-09 in the first quarter of 2017. The assumed proceeds in 2016 include Excess Tax Benefits. The decrease in the diluted shares outst anding primarily reflects treasury share repurchases under the Company’s Board authorized share repurchase program. |
WEIGHTED AVERAGE SHARES OUTST23
WEIGHTED AVERAGE SHARES OUTSTANDING (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Reconciliation of Basic to Diluted Shares Outstanding | Three Months Ended March 31, 2017 2016 Basic 191.1 195.0 Dilutive effect of shares issuable under stock-based compensation plans 3.2 2.9 Diluted 194.3 197.9 Anti-dilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock excluded from the table above 1.0 1.5 |
Reconciliation of Basic to Dilu
Reconciliation of Basic to Diluted Shares Outstanding (Detail) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Schedule Of Earnings Per Share Basic And Diluted By Common Class [Line Items] | ||
Basic | 191.1 | 195 |
Dilutive effect of shares issuable under stock-based compensation plans | 3.2 | 2.9 |
Diluted | 194.3 | 197.9 |
Anti-dilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock which are excluded from the table above | 1 | 1.5 |
CASH EQUIVALENT AND INVESTMENTS
CASH EQUIVALENT AND INVESTMENTS | 3 Months Ended |
Mar. 31, 2017 | |
CASH EQUIVALENT AND INVESTMENT | NOTE 5. CASH EQUIVALENTS AND INVESTMENTS The table below provides additional information on the Company’s cash equivalents and investments: As of March 31, 2017 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 240.8 $ - $ 240.8 $ 240.8 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 1,111.5 $ - $ 1,111.5 $ 977.9 $ 132.8 $ 0.8 Fixed maturity and open ended mutual funds (2) $ 26.5 $ 6.0 $ 32.5 $ - $ - $ 32.5 As of December 31, 2016 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 189.0 $ - $ 189.0 $ 189.0 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 1,190.5 $ - $ 1,190.5 $ 1,017.0 $ 173.4 $ 0.1 Fixed maturity and open ended mutual funds (2) $ 27.0 $ 5.6 $ 32.6 $ - $ - $ 32.6 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 March 31, 2017 and at December 31, 2016. The remaining contractual maturities for the certificates of deposits classified in other assets are 23 months at March 31, 2017 and 13 months to 15 months at December 31, 2016. Time deposits with a maturity of less than 90 days at time of purchase are classified as c ash and cash equivalents. Consists of investments in fixed maturity mutual funds and open-ended mutual funds. The remaining contractual maturities for the fixed maturity instruments range from three months to 16 months and six months to 19 months at Mar ch 31, 2017 and December 31,2016 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 d etermined using Level 1 inputs as defined in the ASC . |
CASH EQUIVALENT AND INVESTMEN26
CASH EQUIVALENT AND INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Schedule of Available For Sale Securities | As of March 31, 2017 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 240.8 $ - $ 240.8 $ 240.8 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 1,111.5 $ - $ 1,111.5 $ 977.9 $ 132.8 $ 0.8 Fixed maturity and open ended mutual funds (2) $ 26.5 $ 6.0 $ 32.5 $ - $ - $ 32.5 As of December 31, 2016 Balance sheet location Cost Gross Unrealized Gains Fair Value Cash and cash equivalents Short-term investments Other assets Money market mutual funds $ 189.0 $ - $ 189.0 $ 189.0 $ - $ - Certificates of deposit and money market deposit accounts (1) $ 1,190.5 $ - $ 1,190.5 $ 1,017.0 $ 173.4 $ 0.1 Fixed maturity and open ended mutual funds (2) $ 27.0 $ 5.6 $ 32.6 $ - $ - $ 32.6 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 March 31, 2017 and at December 31, 2016. The remaining contractual maturities for the certificates of deposits classified in other assets are 23 months at March 31, 2017 and 13 months to 15 months at December 31, 2016. Time deposits with a maturity of less than 90 days at time of purchase are classified as c ash and cash equivalents. Consists of investments in fixed maturity mutual funds and open-ended mutual funds. The remaining contractual maturities for the fixed maturity instruments range from three months to 16 months and six months to 19 months at Mar ch 31, 2017 and December 31,2016 respectively. |
Cash Equivalent and Investmen27
Cash Equivalent and Investments (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Schedule Of Available For Sale Securities [Line Items] | ||||
Fair value | $ 32.5 | $ 32.6 | ||
Cash and cash equivalents | 2,129.6 | 2,051.5 | $ 1,576.1 | $ 1,757.4 |
Short-term investments | 132.8 | 173.4 | ||
Money Market [Member] | ||||
Schedule Of Available For Sale Securities [Line Items] | ||||
Cost | 240.8 | 189 | ||
Fair value | 240.8 | 189 | ||
Cash and cash equivalents | 240.8 | 189 | ||
Certificates Of Deposit [Member] | ||||
Schedule Of Available For Sale Securities [Line Items] | ||||
Cost | 1,111.5 | 1,190.5 | ||
Fair value | 1,111.5 | 1,190.5 | ||
Cash and cash equivalents | 977.9 | 1,017 | ||
Short-term investments | 132.8 | 173.4 | ||
Other assets | 0.8 | 0.1 | ||
Fixed Maturity and Mutual Funds [Member] | ||||
Schedule Of Available For Sale Securities [Line Items] | ||||
Cost | 26.5 | 27 | ||
Gross unrealized gain | 6 | 5.6 | ||
Fair value | 32.5 | 32.6 | ||
Other assets | $ 32.5 | $ 32.6 |
Cash Equivalent and Investmen28
Cash Equivalent and Investments (Parenthetical) (Detail) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Certificates Of Deposit [Member] | Other Assets [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities Maturity period | 23 months | |
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 | 13 months | |
Minimum [Member] | Fixed Maturity and Mutual Funds [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities Maturity period | 3 months | 6 months |
Maximum [Member] | Certificates Of Deposit [Member] | Short Term Investments [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities Maturity period | 12 months | 12 months |
Maximum [Member] | Certificates Of Deposit [Member] | Cash And Cash Equivalents [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities Maturity period | 90 days | |
Maximum [Member] | Certificates Of Deposit [Member] | Other Assets [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities Maturity period | 15 months | |
Maximum [Member] | Fixed Maturity and Mutual Funds [Member] | ||
Schedule Of Investments [Line Items] | ||
Securities Maturity period | 16 months | 19 months |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2017 | |
ACQUISITIONS | NOTE 6. ACQUISITIONS The business combination s 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 mater ial. Additionally, the near term impact to the Company’s operations and cash flows is not material. SCDM Financial On February 13 , 2017, a subsidiary of the Company acquired the structured finance data and analytics business of SCDM Financial. The aggregate purchase price was not material and the near term impact to the Company’s operations and cash flow is not expected to be material. This business unit operates in the MA reportable segment and goodwill related to this acquisition has been allocated to the RD&A reporting unit. Korea Investor Service (KIS) In July 2016, a subsidiary of the Company acquired the non-controlling interest of KIS and additional shares of KIS Pricing. The aggregate purchase price was not material and the near term impact to the Company’s operations and cash flow is not expected to be material. KIS and KIS Pricing are a part of the MIS segment. Gilliland Gold Young (GGY) On March 1, 2016, subsidiaries of the Company acquired 100 % of GGY, a leading provider of advanced actuarial software for the life insurance industry. The cash payments noted in the table below were funded with cash on hand. The acquisition of GGY will allow MA to provide an industry-leading enterprise risk offering for global life insurers and reinsurers. The table below details the total consideration relating to the acquisition: Cash paid at closing $ 83.4 Additional consideration paid to sellers in the third quarter of 2016 (1) 3.1 Total consideration $ 86.5 (1) Represents additional consideration paid to the sellers for amounts withheld at closing pending the completion of certain administrative matters 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 $ 11.7 Property and equipment, net 2.0 Indemnification assets 1.5 Intangible assets: Trade name (19 year weighted average life) $ 3.7 Client relationships (21 year weighted average life) 13.8 Software (7 year weighted average life) 16.6 Total intangible assets (14 year weighted average life) 34.1 Goodwill 59.4 Liabilities (22.2) Net assets acquired $ 86.5 Current assets in the table above include acquired cash of $ 7.5 million. Additionally, current assets include accounts receivable of $ 2.9 million. Goodwill, which has been assigned to the MA segment, is not deductible for tax. In connection with the acquisition, the Company assumed liabilities relating to UTPs and certain other tax exposures which are included in the liabilities assumed in the table above. The sellers have contractually indemnified the Company against any potential payments that may h ave to be made regarding these amounts. Accordingly, the Company carries an indemnification asset on its consolidated balance sheet at March 31, 201 7 and December 31, 2016 . The Company incurred $ 0.9 million of costs directly related to the GGY acquisition of which $ 0.6 million was incurred in 2015 and $ 0.3 million was incurred in the first quarter of 2016. These costs are recorded within selling, general and administrative expenses in the Company’s consolidated statements of operations. GGY is part of the E RS reporting unit for purposes of the Company’s annual goodwill impairment assessment. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) - Gilliland Gold Young (GGY) [Member] | 3 Months Ended |
Mar. 31, 2016 | |
Consideration to The Step Acquisition | Cash paid at closing $ 83.4 Additional consideration paid to sellers in the third quarter of 2016 (1) 3.1 Total consideration $ 86.5 (1) Represents additional consideration paid to the sellers for amounts withheld at closing pending the completion of certain administrative matters |
Summary of Fair Values of Assets Acquired and Liabilities Assumed | Current assets $ 11.7 Property and equipment, net 2.0 Indemnification assets 1.5 Intangible assets: Trade name (19 year weighted average life) $ 3.7 Client relationships (21 year weighted average life) 13.8 Software (7 year weighted average life) 16.6 Total intangible assets (14 year weighted average life) 34.1 Goodwill 59.4 Liabilities (22.2) Net assets acquired $ 86.5 |
Total Consideration Transferred
Total Consideration Transferred to Sellers (Detail) - Gilliland Gold Young (GGY) [Member] $ in Millions | Mar. 01, 2016USD ($) |
Business Acquisition [Line Items] | |
Cash paid | $ 83.4 |
Additional consideration to be paid to seller in 2016 | 3.1 |
Total consideration | $ 86.5 |
Purchase Price Allocation (Deta
Purchase Price Allocation (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 01, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | ||||
Indemnification asset | $ 16.8 | $ 16.5 | ||
Goodwill | $ 1,029.6 | $ 1,023.6 | $ 976.3 | |
Gilliland Gold Young (GGY) [Member] | ||||
Business Acquisition [Line Items] | ||||
Current assets | $ 11.7 | |||
Property and equipment, net | 2 | |||
Indemnification asset | 1.5 | |||
Total intangible assets | 34.1 | |||
Goodwill | 59.4 | |||
Liabilities assumed | (22.2) | |||
Net assets acquired | 86.5 | |||
Gilliland Gold Young (GGY) [Member] | Trade Names [Member] | ||||
Business Acquisition [Line Items] | ||||
Total intangible assets | 3.7 | |||
Gilliland Gold Young (GGY) [Member] | Customer Relationships [Member] | ||||
Business Acquisition [Line Items] | ||||
Total intangible assets | 13.8 | |||
Gilliland Gold Young (GGY) [Member] | Software [Member] | ||||
Business Acquisition [Line Items] | ||||
Total intangible assets | $ 16.6 |
Purchase Price Allocation (Pare
Purchase Price Allocation (Parenthetical) (Detail) - Gilliland Gold Young (GGY) [Member] | Mar. 01, 2016 |
Business Acquisition [Line Items] | |
Weighted average life of intangible assets acquired (in years) | 14 years |
Trade Names [Member] | |
Business Acquisition [Line Items] | |
Weighted average life of intangible assets acquired (in years) | 19 years |
Customer Relationships [Member] | |
Business Acquisition [Line Items] | |
Weighted average life of intangible assets acquired (in years) | 21 years |
Software [Member] | |
Business Acquisition [Line Items] | |
Weighted average life of intangible assets acquired (in years) | 7 years |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - Gilliland Gold Young [Member] - USD ($) $ in Millions | Mar. 01, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||
Acquired cash | $ 7.5 | ||
Amount related to transaction cost | $ 0.9 | $ 0.3 | $ 0.6 |
Percentage of interests acquired | 100.00% | ||
Acquired account receivables | $ 2.9 | ||
Cash paid for acquisitions, net of cash required | $ 83.4 |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Mar. 31, 2017 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | NOTE 7. 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 The Com pany has entered into interest rate swaps to convert the fixed interest rate on certain of its long-term debt 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 va lue of the long-term debt, 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 debt. The changes in the fair value of the swaps and the underlying hedged item generally offset and the net cash settlements on the swaps are recorded each period within interest ( expense ) income , net in the Company’s consolidated statement of operations. The following table summarizes the Comp any’s interest rate s waps designated as fair value hedges: Hedged Item Nature of Swap Notional Amount Floating Interest Rate As of March 31, 2017 As of December 31, 2016 2010 Senior Notes due 2020 Pay Floating/Receive Fixed $ 500.0 $ 500.0 3-month LIBOR 2014 Senior Notes due 2019 Pay Floating/Receive Fixed $ 450.0 $ 450.0 3-month LIBOR 2012 Senior Notes due 2022 Pay Floating/Receive Fixed $ 80.0 $ 80.0 3-month LIBOR 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 Three Months Ended March 31, Derivatives Designated as Fair Value Accounting Hedges Location on Consolidated Statement of Operations 2017 2016 Interest rate swaps Interest expense, net $ 2.4 $ 3.0 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 below. Under the terms of the swap, the Company will pay the counterparty interest on the $ 110.5 mill ion received at 3.945 % per annum and the counterparty will pay the Company interest on the € 100 million 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-curren cy swap in 2027 or upon early termination at the discretion of the Company. The principal payments on 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 disc retion of the Company. In March 2016, the Company designated these cross-currency swaps as cash flow hedges. Accordingly, changes in fair value subsequent to the date the swaps were designated as cash flow hedges will initially be recognized in OCI. Gains and losses on the swaps initially recognized in OCI will be reclassified to the statement of operations in the period in which changes in the underlying hedged item affects net income. Ineffectiveness, if any, will be recognized in other non-operating (exp ense) income, net in the Company’s consolidated statement of operations. 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 hedges are designated as a ccounting 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 the fair value is recor ded in OCI 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-operating (expense) income, net in the Company’s consolidated statement of o p erations. The following table summarizes the notional amounts of the Company’s outstanding forward contracts that are designated as net investment hedges: March 31, December 31, 2017 2016 Notional amount of net investment hedges: Sell Buy Sell Buy Contracts to sell GBP for euros £ 22.1 € 26.4 £ 22.1 € 26.4 The outstanding contracts to sell GBP for euros mature in June 2017. 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: Derivatives and Non-Derivative Instruments in Net Investment Hedging Relationships Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion), net of Tax Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion), net of Tax Three Months Ended Three Months Ended March 31, March 31, 2017 2016 2017 2016 FX forwards $ - $ (4.6) $ - $ - Long-term debt (3.6) (13.1) - - Total net investment hedges $ (3.6) $ (17.7) $ - $ - Derivatives in Cash Flow Hedging Relationships Cross currency swap $ (0.2) $ 1.2 $ 1.0 * $ 1.4 * Treasury rate lock - - (0.1) - Total cash flow hedges $ (0.2) $ 1.2 $ 0.9 $ 1.4 Total $ (3.8) $ (16.5) $ 0.9 $ 1.4 *Reflects a$ 1.5 million ($0.5 million tax effect) and $2.2 million ($0.8 million tax effect) gain for 2017 and 2016, respectively, recorded in other non-operating (expense) income, net. The cumulative amount of realized and unrecognized net investment hedge and cash flow hedge gains (losses) recorded in AOCI is as follows: Cumulative Gains/(Losses), net of tax March 31, December 31, Net investment hedges 2017 2016 FX forwards $ 22.3 $ 22.3 Long-term debt 8.9 12.5 Total net investment hedges $ 31.2 $ 34.8 Cash flow hedges Treasury rate lock $ (1.0) $ (1.1) Cross currency swap 1.7 2.8 Total cash flow hedges 0.7 1.7 Total net gains in AOCI $ 31.9 $ 36.5 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 with 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 September 2017. The following table summarizes the notional amounts of the Company’s outstanding foreign exchange forwards: March 31, December 31, 2017 2016 Notional amount of currency pair: Sell Buy Sell Buy Contracts to purchase USD with euros € 35.5 $ 37.8 € - $ - Contracts to sell USD for euros $ 31.9 € 30.0 $ - € - Contracts to sell USD for GBP $ 278.1 £ 222.5 $ - £ - Contracts to sell USD for CAD $ 16.7 C$ 22.3 $ - C$ - Contracts to purchase euros with Singapore dollars S$ - € - S$ 55.5 € 36.0 Contracts to sell euros for GBP € 30.0 £ 25.7 € 31.0 £ 25.9 Note: € = Euro, £ = British pound, S$ = Singapore dollar, C$ = Canadian dollar, $ = U.S. dollar The following table summarizes the impact to the consolidated statements of operations relating to the net ( losses) gains on the Company’s derivatives which are not designated as hedging instruments: Three Months Ended March 31, Derivatives Not Designated as Accounting Hedges Location on Statement of Operations 2017 2016 Foreign exchange forwards Other non-operating (expense) income, net $ (2.3) $ 0.5 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 non-derivative debt instruments designated and qualifying as net investment hedges : Derivative and Non-Derivative Instruments Balance Sheet Location March 31, 2017 December 31, 2016 Assets: Derivatives designated as accounting hedges: FX forwards on net investment in certain foreign subsidiaries Other current assets $ 0.6 $ 0.6 Interest rate swaps Other assets 4.5 7.0 Total derivatives designated as accounting hedges 5.1 7.6 Derivatives not designated as accounting hedges: FX forwards on certain assets and liabilities Other current assets 1.1 - Total assets $ 6.2 $ 7.6 Liabilities: Derivatives designated as accounting hedges: Cross-currency swap Other non-current liabilities $ 4.1 $ 3.8 Interest rate swaps Other non-current liabilities 1.3 0.8 Total derivatives designated as accounting hedges 5.4 0.8 Non-derivative instrument designated as accounting hedge Long-term debt designated as net investment hedge Long-term debt 427.8 421.9 Derivatives not designated as accounting hedges: FX forwards on certain assets and liabilities Accounts payable and accrued liabilities 0.7 0.8 Total liabilities $ 433.9 $ 423.5 |
DERIVATIVE INSTRUMENTS AND HE36
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Schedule of Interest Rate Swap | Hedged Item Nature of Swap Notional Amount Floating Interest Rate As of March 31, 2017 As of December 31, 2016 2010 Senior Notes due 2020 Pay Floating/Receive Fixed $ 500.0 $ 500.0 3-month LIBOR 2014 Senior Notes due 2019 Pay Floating/Receive Fixed $ 450.0 $ 450.0 3-month LIBOR 2012 Senior Notes due 2022 Pay Floating/Receive Fixed $ 80.0 $ 80.0 3-month LIBOR |
Gains and Losses on Derivatives Designated as Hedging Instruments | Amount of Income Recognized in the Consolidated Statements of Operations Three Months Ended March 31, Derivatives Designated as Fair Value Accounting Hedges Location on Consolidated Statement of Operations 2017 2016 Interest rate swaps Interest expense, net $ 2.4 $ 3.0 |
Amount of Gain/(Loss) Recognized in AOCI on Derivative Net Investment Hedging Relationships (Effectiveness Portion) | Derivatives and Non-Derivative Instruments in Net Investment Hedging Relationships Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion), net of Tax Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion), net of Tax Three Months Ended Three Months Ended March 31, March 31, 2017 2016 2017 2016 FX forwards $ - $ (4.6) $ - $ - Long-term debt (3.6) (13.1) - - Total net investment hedges $ (3.6) $ (17.7) $ - $ - Derivatives in Cash Flow Hedging Relationships Cross currency swap $ (0.2) $ 1.2 $ 1.0 * $ 1.4 * Treasury rate lock - - (0.1) - Total cash flow hedges $ (0.2) $ 1.2 $ 0.9 $ 1.4 Total $ (3.8) $ (16.5) $ 0.9 $ 1.4 *Reflects a$ 1.5 million ($0.5 million tax effect) and $2.2 million ($0.8 million tax effect) gain for 2017 and 2016, respectively, recorded in other non-operating (expense) income, net. |
Cumulative Amount of Unrecognized Hedge Losses Recorded in Accumulated Other Comprehensive Income | Cumulative Gains/(Losses), net of tax March 31, December 31, Net investment hedges 2017 2016 FX forwards $ 22.3 $ 22.3 Long-term debt 8.9 12.5 Total net investment hedges $ 31.2 $ 34.8 Cash flow hedges Treasury rate lock $ (1.0) $ (1.1) Cross currency swap 1.7 2.8 Total cash flow hedges 0.7 1.7 Total net gains in AOCI $ 31.9 $ 36.5 |
Gains and Losses Recognized in Consolidated Statement of Operations on Derivatives Not Designated as Hedging instruments | Three Months Ended March 31, Derivatives Not Designated as Accounting Hedges Location on Statement of Operations 2017 2016 Foreign exchange forwards Other non-operating (expense) income, net $ (2.3) $ 0.5 |
Fair Value of Derivative Instruments | Derivative and Non-Derivative Instruments Balance Sheet Location March 31, 2017 December 31, 2016 Assets: Derivatives designated as accounting hedges: FX forwards on net investment in certain foreign subsidiaries Other current assets $ 0.6 $ 0.6 Interest rate swaps Other assets 4.5 7.0 Total derivatives designated as accounting hedges 5.1 7.6 Derivatives not designated as accounting hedges: FX forwards on certain assets and liabilities Other current assets 1.1 - Total assets $ 6.2 $ 7.6 Liabilities: Derivatives designated as accounting hedges: Cross-currency swap Other non-current liabilities $ 4.1 $ 3.8 Interest rate swaps Other non-current liabilities 1.3 0.8 Total derivatives designated as accounting hedges 5.4 0.8 Non-derivative instrument designated as accounting hedge Long-term debt designated as net investment hedge Long-term debt 427.8 421.9 Derivatives not designated as accounting hedges: FX forwards on certain assets and liabilities Accounts payable and accrued liabilities 0.7 0.8 Total liabilities $ 433.9 $ 423.5 |
Net Investment Hedging [Member] | |
Summary of Notional Amounts of Outstanding Foreign Exchange Forwards | March 31, December 31, 2017 2016 Notional amount of net investment hedges: Sell Buy Sell Buy Contracts to sell GBP for euros £ 22.1 € 26.4 £ 22.1 € 26.4 |
Foreign Exchange Forward [Member] | |
Summary of Notional Amounts of Outstanding Foreign Exchange Forwards | March 31, December 31, 2017 2016 Notional amount of currency pair: Sell Buy Sell Buy Contracts to purchase USD with euros € 35.5 $ 37.8 € - $ - Contracts to sell USD for euros $ 31.9 € 30.0 $ - € - Contracts to sell USD for GBP $ 278.1 £ 222.5 $ - £ - Contracts to sell USD for CAD $ 16.7 C$ 22.3 $ - C$ - Contracts to purchase euros with Singapore dollars S$ - € - S$ 55.5 € 36.0 Contracts to sell euros for GBP € 30.0 £ 25.7 € 31.0 £ 25.9 Note: € = Euro, £ = British pound, S$ = Singapore dollar, C$ = Canadian dollar, $ = U.S. dollar |
Schedule of Interest Rate Swap
Schedule of Interest Rate Swap (Details) - Interest rate swaps [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
2010 Senior Notes [Member] | ||
Derivative [Line Items] | ||
Hedged Item | 2010 Senior Notes due 2020 | |
Nature of Swap | Pay Floating/Receive Fixed | |
Notional amount | $ 500 | $ 500 |
Interest rate description | 3-month LIBOR | |
2012 Senior Notes [Member] | ||
Derivative [Line Items] | ||
Hedged Item | 2012 Senior Notes due 2022 | |
Nature of Swap | Pay Floating/Receive Fixed | |
Notional amount | $ 80 | 80 |
Interest rate description | 3-month LIBOR | |
2014 Senior Notes (5-Year) [Member] | ||
Derivative [Line Items] | ||
Hedged Item | 2014 Senior Notes due 2019 | |
Nature of Swap | Pay Floating/Receive Fixed | |
Notional amount | $ 450 | $ 450 |
Interest rate description | 3-month LIBOR |
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 | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivatives Designated as Accounting Hedges [Member] | Interest Rate Swap [Member] | Interest Expense [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of gain (loss) recognized in income | $ 2.4 | $ 3 |
Derivatives Not Designated as Accounting Hedges [Member] | Foreign Exchange Forward [Member] | Other Nonoperating (Expense) Income [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of gain (loss) recognized in income | $ (2.3) | $ 0.5 |
Summary of Notional Amounts of
Summary of Notional Amounts of Outstanding Foreign Exchange Forwards, Net Investment Hedging (Detail) - Net Investment Hedging [Member] - Contracts to Sell GBP for Euros [Member] € in Millions, £ in Millions | Mar. 31, 2017EUR (€) | Mar. 31, 2017GBP (£) | Dec. 31, 2016EUR (€) | Dec. 31, 2016GBP (£) |
Sell [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | £ | £ 22.1 | £ 22.1 | ||
Buy [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount | € | € 26.4 | € 26.4 |
Gains (Losses) Recognized in AO
Gains (Losses) Recognized in AOCI and Reclassified from AOCI on Derivatives (Effective Portion) (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion) | $ (3.8) | $ (16.5) |
Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion) | 0.9 | 1.4 |
Net Investment Hedging [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion) | (3.6) | (17.7) |
Net Investment Hedging [Member] | Foreign Exchange Contract [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion) | (4.6) | |
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) | (3.6) | (13.1) |
Cash Flow Hedging [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion) | (0.2) | 1.2 |
Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion) | 0.9 | 1.4 |
Cash Flow Hedging [Member] | Treasury Rate Lock [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion) | (0.1) | |
Cash Flow Hedging [Member] | Cross-Currency Swap [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Recognized in AOCI on Derivative (Effective Portion) | (0.2) | 1.2 |
Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion) | 1 | 1.4 |
Cash Flow Hedging [Member] | Cross-Currency Swap [Member] | Other Nonoperating Income (Expense) [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Amount of Gain/(Loss) Reclassified from AOCI into Income (Effective Portion) | $ 1.5 | $ 2.2 |
Gains (Losses) Recognized in 41
Gains (Losses) Recognized in AOCI and Reclassified from AOCI on Derivatives (Effective Portion) (Parenthetical) (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivative Instruments Gain Loss [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ 0.9 | $ 1.4 |
Cash Flow Hedging [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | 0.9 | 1.4 |
Cash Flow Hedging [Member] | Currency Swap [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | 1 | 1.4 |
Cash Flow Hedging [Member] | Currency Swap [Member] | Other Nonoperating Income (Expense) [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | 1.5 | 2.2 |
Cash Flow Hedging [Member] | Currency Swap [Member] | Tax Effect [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ (0.5) | $ (0.8) |
Cumulative Amount of Unrecogniz
Cumulative Amount of Unrecognized Hedge Losses Recorded in Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | $ 31.9 | $ 36.5 |
Net Investment Hedging [Member] | ||
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 31.2 | 34.8 |
Net Investment Hedging [Member] | Foreign Exchange Contract [Member] | ||
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 22.3 | 22.3 |
Net Investment Hedging [Member] | Long-Term Debt [Member] | ||
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 8.9 | 12.5 |
Cash Flow Hedging [Member] | ||
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | 0.7 | 1.7 |
Cash Flow Hedging [Member] | Treasury Rate Lock [Member] | ||
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | (1) | (1.1) |
Cash Flow Hedging [Member] | Cross-Currency Swap [Member] | ||
Derivative [Line Items] | ||
Cumulative amount of unrecognized hedge losses recorded in AOCI | $ 1.7 | $ 2.8 |
Summary of Notional Amounts o43
Summary of Notional Amounts of Outstanding Foreign Exchange Forwards, Cash Flow Hedging (Detail) € in Millions, £ in Millions, SGD in Millions, CAD in Millions, $ in Millions | Mar. 31, 2017CAD | Mar. 31, 2017EUR (€) | Mar. 31, 2017GBP (£) | Mar. 31, 2017USD ($) | Dec. 31, 2016EUR (€) | Dec. 31, 2016GBP (£) | Dec. 31, 2016SGD | Dec. 31, 2016USD ($) |
Contracts to Purchase USD with Euros [Member] | Sell [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | € | € 35.5 | |||||||
Contracts to Purchase USD with Euros [Member] | Buy [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | $ | $ 37.8 | |||||||
Contracts to Sell USD for Euros [Member] | Sell [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | $ | $ 31.9 | |||||||
Contracts to Sell USD for Euros [Member] | Buy [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | € | € 30 | |||||||
Contracts to Sell US Dollars for GBP [Member] | Sell [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | $ | 278.1 | |||||||
Contracts to Sell US Dollars for GBP [Member] | Buy [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | £ | £ 222.5 | |||||||
Contracts to Sell USD for CAD [Member] | Sell [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | $ | $ 16.7 | |||||||
Contracts to Sell USD for CAD [Member] | Buy [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | CAD | CAD 22.3 | |||||||
Contracts to Sell Euros for Other Foreign Currencies [Member] | Sell [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | SGD | SGD 55.5 | |||||||
Contracts to Sell Euros for Other Foreign Currencies [Member] | Buy [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | € | 36 | |||||||
Contracts to Sell Euros for GBP [Member] | Sell [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | € | € 30 | € 31 | ||||||
Contracts to Sell Euros for GBP [Member] | Buy [Member] | ||||||||
Derivative [Line Items] | ||||||||
Derivative Notional Amount | £ | £ 25.7 | £ 25.9 |
Fair Value of Derivative Instru
Fair Value of Derivative Instruments (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Derivatives Fair Value [Line Items] | ||
Derivatives assets | $ 6.2 | $ 7.6 |
Derivatives liabilities | 433.9 | 423.5 |
Derivatives Designated as Accounting Hedges [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 5.1 | 7.6 |
Derivatives liabilities | 5.4 | 0.8 |
Derivatives Designated as Accounting Hedges [Member] | Interest Rate Swap [Member] | Other Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 4.5 | 7 |
Derivatives Designated as Accounting Hedges [Member] | Interest Rate Swap [Member] | Other Noncurrent Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 1.3 | 0.8 |
Derivatives Designated as Accounting Hedges [Member] | Net Investment Hedging [Member] | Foreign Exchange Contract [Member] | Other Current Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 0.6 | 0.6 |
Derivatives Not Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Other Current Assets [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives assets | 1.1 | |
Derivatives Not Designated as Accounting Hedges [Member] | Foreign Exchange Contract [Member] | Accounts Payable And Accrued Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 0.7 | 0.8 |
Derivatives Not Designated as Accounting Hedges [Member] | Cross-Currency Swap [Member] | Other Noncurrent Liabilities [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | 4.1 | 3.8 |
Non Derivative Designated As Hedging Instrument [Member] | Net Investment Hedging [Member] | Long Term Debt [Member] | ||
Derivatives Fair Value [Line Items] | ||
Derivatives liabilities | $ 427.8 | $ 421.9 |
Derivative Instruments And He45
Derivative Instruments And Hedging Activities - Additional Information (Detail) - Derivatives Designated as Accounting Hedges [Member] - 2015 Senior Notes [Member] € in Millions, $ in Millions | Mar. 31, 2017EUR (€) | Mar. 31, 2017USD ($) |
Currency Swap [Member] | Cross-Currency Paid [Member] | ||
Derivative [Line Items] | ||
Notional amount | € 100 | |
Derivative, swaption interest rate | 1.75% | 1.75% |
Currency Swap [Member] | Cross-Currency Received [Member] | ||
Derivative [Line Items] | ||
Notional amount | $ | $ 110.5 | |
Derivative, swaption interest rate | 3.945% | 3.945% |
Net Investment Hedging [Member] | ||
Derivative [Line Items] | ||
Notional amount | € 400 |
GOODWILL AND OTHER ACQUIRED INT
GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2017 | |
GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS | NOTE 8 . GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS The following table summarizes the activity in goodwill for the periods indicated: Three Months Ended March 31, 2017 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 $ 277.0 $ - $ 277.0 $ 758.8 $ (12.2) $ 746.6 $ 1,035.8 $ (12.2) $ 1,023.6 Additions/adjustments - - - 3.6 - 3.6 3.6 - 3.6 Foreign currency translation adjustments (2.8) - (2.8) 5.2 - 5.2 2.4 - 2.4 Ending balance $ 274.2 $ - $ 274.2 $ 767.6 $ (12.2) $ 755.4 $ 1,041.8 $ (12.2) $ 1,029.6 Year ended December 31, 2016 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 $ 284.4 $ - $ 284.4 $ 704.1 $ (12.2) $ 691.9 $ 988.5 $ (12.2) $ 976.3 Additions/adjustments - - - 61.0 - 61.0 61.0 - 61.0 Goodwill derecognized upon sale of subsidiary (3.2) - (3.2) - - - (3.2) - (3.2) Foreign currency translation adjustments (4.2) - (4.2) (6.3) - (6.3) (10.5) - (10.5) Ending balance $ 277.0 $ - $ 277.0 $ 758.8 $ (12.2) $ 746.6 $ 1,035.8 $ (12.2) $ 1,023.6 The 2017 additions/adjustments for the MA segment in the table above relate to the acquisition of the structured finance data and analytics business of SCDM. The 2016 additions/adjustments for the MA segment in the table above relate to the acquisition of GGY. The 2016 goodwill derecognized for the MIS segment in the table above relates to the divestiture of ICTEAS in the fourth quarter of 2016. Acquired intang ible assets and related amortization consisted of: March 31, December 31, 2017 2016 Customer relationships $ 313.2 $ 310.1 Accumulated amortization (128.7) (124.4) Net customer relationships 184.5 185.7 Trade secrets 29.9 29.9 Accumulated amortization (26.2) (25.6) Net trade secrets 3.7 4.3 Software 88.8 87.7 Accumulated amortization (58.3) (54.9) Net software 30.5 32.8 Trade names 74.7 75.3 Accumulated amortization (21.0) (19.9) Net trade names 53.7 55.4 Other 43.4 43.5 Accumulated amortization (26.0) (25.3) Net other 17.4 18.2 Total acquired intangible assets, net $ 289.8 $ 296.4 Other intangible assets primarily consist of databases, covenants not to compete, and acquired ratings methodologies and models. Amortization expense relating to acquired intangible assets is as follows: Three Months Ended March 31, 2017 2016 Amortization expense $ 8.5 $ 7.9 Estimated future amortization expense for acquired intangible assets subject to amortization is as follows: Year Ending December 31, 2017 (after March 31) $ 23.8 2018 26.6 2019 23.7 2020 20.9 2021 20.5 Thereafter 174.3 Total estimated future amortization $ 289.8 Amortizable intangible assets are reviewed for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the estimated undiscounted future cash flows are lower than the carrying amount of the related asset, a loss is recognized for the difference between the carrying amount and the estimated fair value of the asset. There were no impairments to intangible assets during the t hree months ended March 31, 2017 and 2016 . |
GOODWILL AND OTHER ACQUIRED I47
GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Activity in Goodwill | Three Months Ended March 31, 2017 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 $ 277.0 $ - $ 277.0 $ 758.8 $ (12.2) $ 746.6 $ 1,035.8 $ (12.2) $ 1,023.6 Additions/adjustments - - - 3.6 - 3.6 3.6 - 3.6 Foreign currency translation adjustments (2.8) - (2.8) 5.2 - 5.2 2.4 - 2.4 Ending balance $ 274.2 $ - $ 274.2 $ 767.6 $ (12.2) $ 755.4 $ 1,041.8 $ (12.2) $ 1,029.6 Year ended December 31, 2016 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 $ 284.4 $ - $ 284.4 $ 704.1 $ (12.2) $ 691.9 $ 988.5 $ (12.2) $ 976.3 Additions/adjustments - - - 61.0 - 61.0 61.0 - 61.0 Goodwill derecognized upon sale of subsidiary (3.2) - (3.2) - - - (3.2) - (3.2) Foreign currency translation adjustments (4.2) - (4.2) (6.3) - (6.3) (10.5) - (10.5) Ending balance $ 277.0 $ - $ 277.0 $ 758.8 $ (12.2) $ 746.6 $ 1,035.8 $ (12.2) $ 1,023.6 |
Acquired Intangible Assets and Related Amortization | March 31, December 31, 2017 2016 Customer relationships $ 313.2 $ 310.1 Accumulated amortization (128.7) (124.4) Net customer relationships 184.5 185.7 Trade secrets 29.9 29.9 Accumulated amortization (26.2) (25.6) Net trade secrets 3.7 4.3 Software 88.8 87.7 Accumulated amortization (58.3) (54.9) Net software 30.5 32.8 Trade names 74.7 75.3 Accumulated amortization (21.0) (19.9) Net trade names 53.7 55.4 Other 43.4 43.5 Accumulated amortization (26.0) (25.3) Net other 17.4 18.2 Total acquired intangible assets, net $ 289.8 $ 296.4 |
Amortization Expense Relating to Acquired Intangible Assets | Three Months Ended March 31, 2017 2016 Amortization expense $ 8.5 $ 7.9 |
Estimated Future Amortization Expense for Acquired Intangible Assets Subject to Amortization | Year Ending December 31, 2017 (after March 31) $ 23.8 2018 26.6 2019 23.7 2020 20.9 2021 20.5 Thereafter 174.3 Total estimated future amortization $ 289.8 |
Activity in Goodwill (Detail)
Activity in Goodwill (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Line Items] | ||
Beginning balance, Goodwill gross | $ 1,035.8 | $ 988.5 |
Additions/adjustments, gross | 3.6 | 61 |
Goodwill derecognized, gross | (3.2) | |
Foreign currency translation adjustments, gross | 2.4 | (10.5) |
Ending balance, Goodwill gross | 1,041.8 | 1,035.8 |
Beginning balance, Accumulated impairment charge | (12.2) | (12.2) |
Ending balance, Accumulated impairment charge | (12.2) | (12.2) |
Beginning balance, goodwill net | 1,023.6 | 976.3 |
Additions/adjustments | 3.6 | 61 |
Goodwill derecognized | (3.2) | |
Foreign currency translation adjustments | 2.4 | (10.5) |
Ending balance, goodwill net | 1,029.6 | 1,023.6 |
Moodys Investors Service [Member] | ||
Goodwill [Line Items] | ||
Beginning balance, Goodwill gross | 277 | 284.4 |
Goodwill derecognized, gross | (3.2) | |
Foreign currency translation adjustments, gross | (2.8) | (4.2) |
Ending balance, Goodwill gross | 274.2 | 277 |
Beginning balance, goodwill net | 277 | 284.4 |
Goodwill derecognized | (3.2) | |
Foreign currency translation adjustments | (2.8) | (4.2) |
Ending balance, goodwill net | 274.2 | 277 |
Moodys Analytics [Member] | ||
Goodwill [Line Items] | ||
Beginning balance, Goodwill gross | 758.8 | 704.1 |
Additions/adjustments, gross | 3.6 | 61 |
Foreign currency translation adjustments, gross | 5.2 | (6.3) |
Ending balance, Goodwill gross | 767.6 | 758.8 |
Beginning balance, Accumulated impairment charge | (12.2) | (12.2) |
Ending balance, Accumulated impairment charge | (12.2) | (12.2) |
Beginning balance, goodwill net | 746.6 | 691.9 |
Additions/adjustments | 3.6 | 61 |
Foreign currency translation adjustments | 5.2 | (6.3) |
Ending balance, goodwill net | $ 755.4 | $ 746.6 |
Acquired Intangible Assets and
Acquired Intangible Assets and Related Amortization (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, net | $ 289.8 | $ 296.4 |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 313.2 | 310.1 |
Accumulated amortization | (128.7) | (124.4) |
Acquired intangible assets, net | 184.5 | 185.7 |
Trade Secrets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 29.9 | 29.9 |
Accumulated amortization | (26.2) | (25.6) |
Acquired intangible assets, net | 3.7 | 4.3 |
Computer Software Intangible Asset [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 88.8 | 87.7 |
Accumulated amortization | (58.3) | (54.9) |
Acquired intangible assets, net | 30.5 | 32.8 |
Trade Names [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 74.7 | 75.3 |
Accumulated amortization | (21) | (19.9) |
Acquired intangible assets, net | 53.7 | 55.4 |
Other Intangible Assets [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquired intangible assets, gross | 43.4 | 43.5 |
Accumulated amortization | (26) | (25.3) |
Acquired intangible assets, net | $ 17.4 | $ 18.2 |
Amortization Expense Relating t
Amortization Expense Relating to Acquired Intangible Assets (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Finite Lived Intangible Assets [Line Items] | ||
Amortization expense | $ 8.5 | $ 7.9 |
Estimated Future Amortization E
Estimated Future Amortization Expense for Acquired Intangible Assets Subject to Amortization (Detail) $ in Millions | Mar. 31, 2017USD ($) |
Schedule Of Actual And Estimated Amortization Expense [Line Items] | |
2017 (after March 31) | $ 23.8 |
2,018 | 26.6 |
2,019 | 23.7 |
2,020 | 20.9 |
2,021 | 20.5 |
Thereafter | 174.3 |
Total estimated future amortization | $ 289.8 |
FAIR VALUE
FAIR VALUE | 3 Months Ended |
Mar. 31, 2017 | |
FAIR VALUE | NOTE 9. FAIR VALUE The table below presents information about items that are carried at fair value at March 31, 2017 and December 31, 2016 : Fair Value Measurement as of March 31, 2017 Description Balance Level 1 Level 2 Assets: Derivatives (a) $ 6.2 $ - $ 6.2 Money market mutual funds 240.8 240.8 - Fixed maturity and open ended mutual funds 32.5 32.5 - Total $ 279.5 $ 273.3 $ 6.2 Liabilities: Derivatives (a) $ 6.1 $ - $ 6.1 Total $ 6.1 $ - $ 6.1 Fair Value Measurement as of December 31, 2016 Description Balance Level 1 Level 2 Assets: Derivatives (a) $ 7.6 $ - $ 7.6 Money market mutual funds 189.0 189.0 - Fixed maturity and open ended mutual funds 32.6 32.6 - Total $ 229.2 $ 221.6 $ 7.6 Liabilities: Derivatives (a) $ 5.4 $ - $ 5.4 Total $ 5.4 $ - $ 5.4 (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 7 to the condensed consolidated financial statements. 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 as defined in the ASC. |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Financial Instruments Carried at Fair Value on Recurring Basis | Fair Value Measurement as of March 31, 2017 Description Balance Level 1 Level 2 Assets: Derivatives (a) $ 6.2 $ - $ 6.2 Money market mutual funds 240.8 240.8 - Fixed maturity and open ended mutual funds 32.5 32.5 - Total $ 279.5 $ 273.3 $ 6.2 Liabilities: Derivatives (a) $ 6.1 $ - $ 6.1 Total $ 6.1 $ - $ 6.1 Fair Value Measurement as of December 31, 2016 Description Balance Level 1 Level 2 Assets: Derivatives (a) $ 7.6 $ - $ 7.6 Money market mutual funds 189.0 189.0 - Fixed maturity and open ended mutual funds 32.6 32.6 - Total $ 229.2 $ 221.6 $ 7.6 Liabilities: Derivatives (a) $ 5.4 $ - $ 5.4 Total $ 5.4 $ - $ 5.4 (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 7 to the condensed consolidated financial statements. |
Financial Instruments Carried a
Financial Instruments Carried at Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Contracts | $ 6.2 | $ 7.6 |
Money Market Funds | 240.8 | 189 |
Fixed maturity and open ended mutual funds | 32.5 | 32.6 |
Total, Assets | 279.5 | 229.2 |
Derivatives, Liabilities | 6.1 | 5.4 |
Total, Liabilities | 6.1 | 5.4 |
Fair Value Inputs Level 1 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Money Market Funds | 240.8 | 189 |
Fixed maturity and open ended mutual funds | 32.5 | 32.6 |
Total, Assets | 273.3 | 221.6 |
Fair Value Inputs Level 2 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Contracts | 6.2 | 7.6 |
Total, Assets | 6.2 | 7.6 |
Derivatives, Liabilities | 6.1 | 5.4 |
Total, Liabilities | $ 6.1 | $ 5.4 |
OTHER BALANCE SHEET INFORMATION
OTHER BALANCE SHEET INFORMATION | 3 Months Ended |
Mar. 31, 2017 | |
OTHER BALANCE SHEET AND STATEMENT OF OPERATIONS INFORMATION | NOTE 11 . OTHER BALANCE SHEET AND STATEMENT OF OPERATIONS INFORMATION The following tables contain additional detail related to certain balance sheet captions: March 31, December 31, 2017 2016 Other current assets: Prepaid taxes $ 175.9 $ 47.0 Prepaid expenses 73.3 65.7 Other 20.4 28.1 Total other current assets $ 269.6 $ 140.8 March 31, December 31, 2017 2016 Other assets: Investments in joint ventures $ 86.9 $ 26.3 Deposits for real-estate leases 11.2 10.8 Indemnification assets related to acquisitions 16.8 16.5 Mutual funds and fixed deposits 33.3 32.7 Other 18.6 25.9 Total other assets $ 166.8 $ 112.2 March 31, December 31, 2017 2016 Accounts payable and accrued liabilities: Salaries and benefits $ 96.7 $ 89.3 Incentive compensation 48.9 151.1 Accrued settlement charge - 863.8 Customer credits, advanced payments and advanced billings 31.1 28.4 Self-insurance reserves 10.1 11.1 Dividends 4.5 78.5 Professional service fees 47.0 40.4 Interest accrued on debt 18.5 59.2 Accounts payable 24.1 28.4 Income taxes 40.3 16.8 Restructuring 3.0 6.3 Pension and other retirement employee benefits 7.1 6.1 Other 61.3 64.9 Total accounts payable and accrued liabilities $ 392.6 $ 1,444.3 March 31, December 31, 2017 2016 Other liabilities: Pension and other retirement employee benefits $ 272.5 $ 264.1 Deferred rent-non-current portion 97.3 98.3 Interest accrued on UTPs 36.2 34.1 Legacy and other tax matters 1.2 1.2 Other 27.0 27.5 Total other liabilities $ 434.2 $ 425.2 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: Three Months Ended Year Ended March 31, December 31, 2017 2016 Balance January 1, $ 11.1 $ 19.7 Accruals (reversals), net 1.8 12.1 Payments (2.8) (20.7) Balance $ 10.1 $ 11.1 Other Non-Operating (Expense) Income: The following table summarizes the components of other non-operating (expense) income: Three Months Ended March 31, 2017 2016 FX (loss) gain $ (9.6) $ 4.0 Joint venture income 1.0 1.9 Other (0.8) (0.3) Total $ (9.4) $ 5.6 CCXI Gain: CCXI is a Chinese credit rating agency in which Moody’s acquired a 49 % stake in 2006. Moody’s accounts for this investment under the equity method of accounting. On March 21, 2017, CCXI, as part of a strategic business realignment, issued additional capital to its majority shareholder in exchange for a ratings business who lly-owned by the majority shareholder and which has the right to rate a different class of debt instrument in the Chinese market. The capital issuance by CCXI in exchange for this ratings business diluted Moody’s ownership interest in CCXI to 30 % of a larg er business and resulted in a $ 59.7 million non-cash, non-taxable gain. The issuance of additional capital by CCXI is treated as if Moody’s sold a 19% interest in CCXI at fair value. The fair value of the 19 % interest in CCXI that Moody’s hypothetic ally sold was estimated using both a discounted cash flow methodology and comparable public company multiples. A DCF analysis requires significant estimates, including projections of future operating results and cash flows based on the budgets and forecas ts of CCXI, expected long-term growth rates, terminal values, WACC and the effects of external factors and market conditions. |
OTHER BALANCE SHEET INFORMATI56
OTHER BALANCE SHEET INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Additional Details Related to Certain Balance Sheet Captions | March 31, December 31, 2017 2016 Other current assets: Prepaid taxes $ 175.9 $ 47.0 Prepaid expenses 73.3 65.7 Other 20.4 28.1 Total other current assets $ 269.6 $ 140.8 March 31, December 31, 2017 2016 Other assets: Investments in joint ventures $ 86.9 $ 26.3 Deposits for real-estate leases 11.2 10.8 Indemnification assets related to acquisitions 16.8 16.5 Mutual funds and fixed deposits 33.3 32.7 Other 18.6 25.9 Total other assets $ 166.8 $ 112.2 March 31, December 31, 2017 2016 Accounts payable and accrued liabilities: Salaries and benefits $ 96.7 $ 89.3 Incentive compensation 48.9 151.1 Accrued settlement charge - 863.8 Customer credits, advanced payments and advanced billings 31.1 28.4 Self-insurance reserves 10.1 11.1 Dividends 4.5 78.5 Professional service fees 47.0 40.4 Interest accrued on debt 18.5 59.2 Accounts payable 24.1 28.4 Income taxes 40.3 16.8 Restructuring 3.0 6.3 Pension and other retirement employee benefits 7.1 6.1 Other 61.3 64.9 Total accounts payable and accrued liabilities $ 392.6 $ 1,444.3 March 31, December 31, 2017 2016 Other liabilities: Pension and other retirement employee benefits $ 272.5 $ 264.1 Deferred rent-non-current portion 97.3 98.3 Interest accrued on UTPs 36.2 34.1 Legacy and other tax matters 1.2 1.2 Other 27.0 27.5 Total other liabilities $ 434.2 $ 425.2 |
Self Insurance Reserves | Three Months Ended Year Ended March 31, December 31, 2017 2016 Balance January 1, $ 11.1 $ 19.7 Accruals (reversals), net 1.8 12.1 Payments (2.8) (20.7) Balance $ 10.1 $ 11.1 |
Other Non-Operating | Three Months Ended March 31, 2017 2016 FX (loss) gain $ (9.6) $ 4.0 Joint venture income 1.0 1.9 Other (0.8) (0.3) Total $ (9.4) $ 5.6 |
Additional Details Related to C
Additional Details Related to Certain Balance Sheet Captions (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Other current assets: | ||
Prepaid taxes | $ 175.9 | $ 47 |
Prepaid expenses | 73.3 | 65.7 |
Other | 20.4 | 28.1 |
Total other current assets | 269.6 | 140.8 |
Other assets | ||
Investments in joint ventures | 86.9 | 26.3 |
Deposits for real-estate leases | 11.2 | 10.8 |
Indemnification assets related to acquisitions | 16.8 | 16.5 |
Mutual funds and fixed deposits | 33.3 | 32.7 |
Other | 18.6 | 25.9 |
Total other assets | 166.8 | 112.2 |
Accounts payable and accrued liabilities | ||
Salaries and benefits | 96.7 | 89.3 |
Incentive compensation | 48.9 | 151.1 |
Accrued settlement charge | 863.8 | |
Customer credits, advanced payments and advanced billings | 31.1 | 28.4 |
Self-insurance reserves | 10.1 | 11.1 |
Dividends | 4.5 | 78.5 |
Professional service fees | 47 | 40.4 |
Interest accrued on debt | 18.5 | 59.2 |
Accounts payable | 24.1 | 28.4 |
Income taxes | 40.3 | 16.8 |
Restructuring | 3 | 6.3 |
Pension and other post retirement employee benefits | 7.1 | 6.1 |
Other | 61.3 | 64.9 |
Total accounts payable and accrued liabilities | 392.6 | 1,444.3 |
Other liabilities | ||
Pension and other post retirement employee benefits | 272.5 | 264.1 |
Deferred rent-non-current portion | 97.3 | 98.3 |
Interest accrued on UTPs | 36.2 | 34.1 |
Legacy and other tax matters | 1.2 | 1.2 |
Other | 27 | 27.5 |
Total other liabilities | $ 434.2 | $ 425.2 |
Changes in Self Insurance Reser
Changes in Self Insurance Reserves (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Disclosure Changes in Self Insurance Reserves [Abstract] | ||
Self-insurance reserves, beginning balance | $ 11.1 | $ 19.7 |
Accruals (reversals), net | 1.8 | 12.1 |
Payments | (2.8) | (20.7) |
Self-insurance reserves, ending balance | $ 10.1 | $ 11.1 |
Other Non-Operating Interest (D
Other Non-Operating Interest (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Component of Other Expense Income Nonoperating [Line Items] | ||
FX gain/(loss) | $ (9.6) | $ 4 |
Joint venture income | 1 | 1.9 |
Other | (0.8) | (0.3) |
Total | $ (9.4) | $ 5.6 |
Other Balance Sheet Informati60
Other Balance Sheet Information - Additional Detail (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Minority Interest [Line Items] | |
Gain on dilution of Stock in Subsidiary | $ 59.7 |
CCXI [Member] | |
Minority Interest [Line Items] | |
Ownership percentage by Parent | 30.00% |
Gain on dilution of Stock in Subsidiary | $ 59.7 |
CCXI [Member] | Business Acquisition Year (2006) [Member] | |
Minority Interest [Line Items] | |
Ownership percentage by Parent | 49.00% |
Hypothetical percentage sold at fair value | 19.00% |
COMPREHENSIVE INCOME RECLASSIFI
COMPREHENSIVE INCOME RECLASSIFICATION | 3 Months Ended |
Mar. 31, 2017 | |
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE INCOME | NOTE 12 . COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE INCOME The following table provides details about the reclassifications out of AOCI: Three Months Ended Affected line in the consolidated statement of operations March 31, March 31, 2017 2016 Gains on cash flow hedges Cross-currency swap 1.5 2.2 Other non-operating (expense) income, net Treasury rate lock (0.1) - Interest expense, net Total before income taxes 1.4 2.2 Income tax effect of items above (0.5) (0.8) Provision for income taxes Total gains on cash flow hedges 0.9 1.4 Pension and other retirement benefits Amortization of actuarial losses and prior service costs included in net income (1.5) (1.6) Operating expense Amortization of actuarial losses and prior service costs included in net income (0.9) (1.0) SG&A expense Total before income taxes (2.4) (2.6) Income tax effect of item above 0.9 1.0 Provision for income taxes Total pension and other retirement benefits (1.5) (1.6) Total losses included in Net Income attributable to reclassifications out of AOCI $ (0.6) $ (0.2) The following table shows changes in AOCI by component (net of tax): Three Months Ended March 31, 2017 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, 2016 $ (79.5) $ 1.7 $ (290.2) $ 3.1 $ (364.9) Other comprehensive income before reclassifications - (0.2) 6.9 0.3 7.0 Amounts reclassified from AOCI 1.5 (0.9) - 0.6 Other comprehensive income/(loss) 1.5 (1.1) 6.9 0.3 7.6 Balance March 31, 2017 $ (78.0) $ 0.6 $ (283.3) $ 3.4 $ (357.3) Three Months Ended March 31, 2016 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, 2015 $ (85.7) $ (1.1) $ (256.0) $ 3.3 $ (339.5) Other comprehensive income/(loss) before reclassifications - 1.2 36.0 0.6 37.8 Amounts reclassified from AOCI 1.6 (1.4) - - 0.2 Other comprehensive income/(loss) 1.6 (0.2) 36.0 0.6 38.0 Balance March 31, 2016 $ (84.1) $ (1.3) $ (220.0) $ 3.9 $ (301.5) |
COMPREHENSIVE INCOME RECLASSI62
COMPREHENSIVE INCOME RECLASSIFICATIONS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Reclassifications out of AOCI | Three Months Ended Affected line in the consolidated statement of operations March 31, March 31, 2017 2016 Gains on cash flow hedges Cross-currency swap 1.5 2.2 Other non-operating (expense) income, net Treasury rate lock (0.1) - Interest expense, net Total before income taxes 1.4 2.2 Income tax effect of items above (0.5) (0.8) Provision for income taxes Total gains on cash flow hedges 0.9 1.4 Pension and other retirement benefits Amortization of actuarial losses and prior service costs included in net income (1.5) (1.6) Operating expense Amortization of actuarial losses and prior service costs included in net income (0.9) (1.0) SG&A expense Total before income taxes (2.4) (2.6) Income tax effect of item above 0.9 1.0 Provision for income taxes Total pension and other retirement benefits (1.5) (1.6) Total losses included in Net Income attributable to reclassifications out of AOCI $ (0.6) $ (0.2) |
Components of Accumulated Other Comprehensive Income | Three Months Ended March 31, 2017 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, 2016 $ (79.5) $ 1.7 $ (290.2) $ 3.1 $ (364.9) Other comprehensive income before reclassifications - (0.2) 6.9 0.3 7.0 Amounts reclassified from AOCI 1.5 (0.9) - 0.6 Other comprehensive income/(loss) 1.5 (1.1) 6.9 0.3 7.6 Balance March 31, 2017 $ (78.0) $ 0.6 $ (283.3) $ 3.4 $ (357.3) Three Months Ended March 31, 2016 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, 2015 $ (85.7) $ (1.1) $ (256.0) $ 3.3 $ (339.5) Other comprehensive income/(loss) before reclassifications - 1.2 36.0 0.6 37.8 Amounts reclassified from AOCI 1.6 (1.4) - - 0.2 Other comprehensive income/(loss) 1.6 (0.2) 36.0 0.6 38.0 Balance March 31, 2016 $ (84.1) $ (1.3) $ (220.0) $ 3.9 $ (301.5) |
Reclassification out of AOCI (D
Reclassification out of AOCI (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash Flow Hedges, net of tax: | ||
Losses on cash flow hedges - Pre Tax | $ 1.4 | $ 2.2 |
Losses on cash flow hedges - Tax | (0.5) | (0.8) |
Losses on cash flow hedges - Net of Tax | 0.9 | 1.4 |
Pension and Other Post-Retirement Benefits, net of tax: | ||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | (2.4) | (2.6) |
Amortization of actuarial losses and prior service costs included in net income - Tax | 0.9 | 1 |
Amortization of actuarial losses and prior service costs included in net income - Net of Tax | (1.5) | (1.6) |
Income Loss Attributable to Reclassification Out Of AOCI Net Of Tax | (0.6) | (0.2) |
Operating Expense [Member] | ||
Pension and Other Post-Retirement Benefits, net of tax: | ||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | (1.5) | (1.6) |
Selling, General and Administrative Expenses [Member] | ||
Pension and Other Post-Retirement Benefits, net of tax: | ||
Amortization of actuarial losses and prior service costs included in net income - Pre Tax | (0.9) | (1) |
Currency Swap [Member] | Other Nonoperating Income (Expense) [Member] | ||
Cash Flow Hedges, net of tax: | ||
Losses on cash flow hedges - Pre Tax | 1.5 | $ 2.2 |
Treasury Rate Lock [Member] | Interest Expense [Member] | ||
Cash Flow Hedges, net of tax: | ||
Losses on cash flow hedges - Pre Tax | $ (0.1) |
Changes in Components of Accumu
Changes in Components of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Beginning Balance | $ (364.9) | $ (339.5) |
Reclassification adjustment from AOCI, Pension and Other Postretirement Benefit Plans - Net of Tax | 1.5 | 1.6 |
Pension and other retirement benefit - Net of Tax | 1.5 | 1.6 |
Net unrealized gain (losses) on cash flow - Net of Tax | (0.2) | 1.2 |
Reclassification gain (losses) on cash flow - Net of Tax | (0.9) | (1.4) |
Gains/(Losses) on cash flow hedges - Net of Tax | (1.1) | (0.2) |
Foreign currency translation adjustments before reclassification - Net of Tax | 12.1 | 36 |
Foreign currency translation adjustments - Net of Tax | 36 | |
Available for sale securities before reclassification - Net of Tax | 0.5 | 0.6 |
Gains on Available for sale securities - Net of Tax | 0.6 | |
Other comprehensive income/(loss) before reclassifications | 37.8 | |
Amounts reclassified from AOCI | 0.6 | 0.2 |
Total other comprehensive income (loss) - Net of Tax | 13 | 38 |
Ending Balance | (357.3) | (301.5) |
Gains Losses on Cash Flow Hedges [Member] | ||
Beginning Balance | 1.7 | (1.1) |
Ending Balance | 0.6 | (1.3) |
Pension and Other Retirement Benefits [Member] | ||
Beginning Balance | (79.5) | (85.7) |
Ending Balance | (78) | (84.1) |
Foreign Currency Translation Adjustments [Member] | ||
Beginning Balance | (290.2) | (256) |
Ending Balance | (283.3) | (220) |
Gains on Available for Sale Securities [Member] | ||
Beginning Balance | 3.1 | 3.3 |
Ending Balance | 3.4 | $ 3.9 |
Parent Company [Member] | ||
Foreign currency translation adjustments before reclassification - Net of Tax | 6.9 | |
Foreign currency translation adjustments - Net of Tax | 6.9 | |
Available for sale securities before reclassification - Net of Tax | 0.3 | |
Gains on Available for sale securities - Net of Tax | 0.3 | |
Other comprehensive income/(loss) before reclassifications | 7 | |
Total other comprehensive income (loss) - Net of Tax | $ 7.6 |
PENSION AND OTHER POST-RETIREME
PENSION AND OTHER POST-RETIREMENT BENEFITS | 3 Months Ended |
Mar. 31, 2017 | |
PENSION AND OTHER RETIREMENT BENEFITS | NOTE 13 . PENSION AND OTHER RETIREMENT BENEFITS M oody’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 for its employees 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 t o herein a s the “Other Retirement Plans”. Effective January 1, 2008, the Company no longer offers DBPPs to U.S. employees hired or rehired on or after January 1, 2008. New U.S. employees will instead receive a retirement contribution of similar benefit val ue under the Company’s Profit Participation Plan. Current participants of the Company’s DBPPs continue to accrue benefits b ased on existing plan formulas. The components of net periodic benefit expense related to the Retirement Plans are as follows: Three Months Ended March 31, Pension Plans Other Retirement Plans 2017 2016 2017 2016 Components of net periodic expense Service cost $ 4.9 $ 5.2 $ 0.6 $ 0.5 Interest cost 4.7 4.6 0.3 0.3 Expected return on plan assets (4.1) (4.3) - - Amortization of net actuarial loss from earlier periods 2.4 2.6 - - Amortization of net prior service costs from earlier periods - - (0.1) - Net periodic expense $ 7.9 $ 8.1 $ 0.8 $ 0.8 The Company made payments of $ 1.3 million related to its unfunded U.S. DBPPs and $ 0.2 million to its U.S. other retirement plans during the three months ended March 31, 201 7 . The Company anticipates making contributions of $ 10.4 million to its funded pension plan , and payments of $ 3.8 million and $ 0.8 million to its un funded U.S. DBPPs and U.S. other retirement plans, respectively, during the remainder of 2017 . |
PENSION AND OTHER POST-RETIRE66
PENSION AND OTHER POST-RETIREMENT BENEFITS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Components of Net Periodic Benefit Expense Related to Post-Retirement Plans | Three Months Ended March 31, Pension Plans Other Retirement Plans 2017 2016 2017 2016 Components of net periodic expense Service cost $ 4.9 $ 5.2 $ 0.6 $ 0.5 Interest cost 4.7 4.6 0.3 0.3 Expected return on plan assets (4.1) (4.3) - - Amortization of net actuarial loss from earlier periods 2.4 2.6 - - Amortization of net prior service costs from earlier periods - - (0.1) - Net periodic expense $ 7.9 $ 8.1 $ 0.8 $ 0.8 |
Components of Net Periodic Bene
Components of Net Periodic Benefit Expense Related to Post-Retirement Plans (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Pension Plans Defined Benefit [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 4.9 | $ 5.2 |
Interest cost | 4.7 | 4.6 |
Expected return on plan assets | (4.1) | (4.3) |
Amortization of net actuarial loss from earlier periods | 2.4 | 2.6 |
Net periodic expense | 7.9 | 8.1 |
Other Postretirement Benefit Plans Defined Benefit [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 0.6 | 0.5 |
Interest cost | 0.3 | 0.3 |
Amortization of net prior service costs from earlier periods | (0.1) | |
Net periodic expense | $ 0.8 | $ 0.8 |
Pension and Other Post-Retire68
Pension and Other Post-Retirement Benefits - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Funded Pension Plans [Member] | |
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Estimated additional payments in 2013 | $ 10.4 |
Unfunded Pension Plans [Member] | |
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Defined benefit payment amount | 1.3 |
Estimated additional payments in 2013 | 3.8 |
Other Postretirement Benefit Plans Defined Benefit [Member] | |
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Defined benefit payment amount | 0.2 |
Estimated additional payments in 2013 | $ 0.8 |
INDEBTEDNESS
INDEBTEDNESS | 3 Months Ended |
Mar. 31, 2017 | |
INDEBTEDNESS | NOTE 13 . INDEBTEDNESS The following table summarizes total indebtedness: March 31, 2017 Principal Amount Fair Value of Interest Rate Swap (1) Unamortized (Discount) Premium Unamortized Debt Issuance Costs Carrying Value Notes Payable: - 5.50% 2010 Senior Notes, due 2020 $ 500.0 $ 3.7 $ (1.3) $ (1.5) $ 500.9 4.50% 2012 Senior Notes, due 2022 500.0 (0.3) (2.3) (2.0) 495.4 4.875% 2013 Senior Notes, due 2024 500.0 - (2.0) (2.6) 495.4 2.75% 2014 Senior Notes (5-Year), due 2019 450.0 (0.2) (0.3) (1.6) 447.9 5.25% 2014 Senior Notes (30-Year), due 2044 600.0 - 3.3 (5.9) 597.4 1.75% 2015 Senior Notes, due 2027 534.8 - - (3.5) 531.3 2.75% 2017 Senior Notes, due 2021 500.0 - (1.5) (3.8) 494.7 2017 Floating Rate Senior Notes, due 2018 300.0 - (1.1) 298.9 Commercial Paper 214.0 - (0.2) - 213.8 Total debt $ 4,098.8 $ 3.2 $ (4.3) $ (22.0) $ 4,075.7 Current portion (213.8) Total long-term debt $ 3,861.9 December 31, 2016 Principal Amount Fair Value of Interest Rate Swap (1) Unamortized (Discount) Premium Unamortized Debt Issuance Costs Carrying Value Notes Payable: 6.06% Series 2007-1 Notes due 2017 $ 300.0 $ - $ - $ $ 300.0 5.50% 2010 Senior Notes, due 2020 500.0 5.5 (1.3) (1.6) 502.6 4.50% 2012 Senior Notes, due 2022 500.0 (0.2) (2.4) (2.1) 495.3 4.875% 2013 Senior Notes, due 2024 500.0 - (2.1) (2.7) 495.2 2.75% 2014 Senior Notes (5-Year), due 2019 450.0 0.9 (0.4) (1.7) 448.8 5.25% 2014 Senior Notes (30-Year), due 2044 600.0 - 3.3 (5.9) 597.4 1.75% 2015 Senior Notes, due 2027 527.4 - - (3.7) 523.7 Total long-term debt $ 3,377.4 $ 6.2 $ (2.9) $ (17.7) $ 3,363.0 Current portion (300.0) Total long-term debt $ 3,063.0 (1) The Company has entered into interest rate swaps on the 2010 Senior Notes, the 2012 Senior Notes and the 2014 Senior Notes (5-Year) which are more fully discussed in Note 7 above. Commercial Paper On August 3, 2016, the Company entered into a private placement commercial paper program under which the Company may issue CP notes up to a maximum amount of $ 1.0 billion. Borrowings under the CP Program are backstopped by the 2015 Facility. Amounts under the CP Program may be re-borrowed. The maturity of the CP Notes will vary, but may not exceed 397 days from the date of issue. The CP Notes are sold at a discount from par, or alternatively, sold at par and bear interest at rates that will vary based upon market conditions. The rates of interest will depend on whether the CP Notes will be a fixed or floating rate. The interest on a floating rate may be based on the following: (a) certificate of deposit rate; (b) commercial paper rate; (c) the federal funds rate; (d) the LIBOR; (e) prime rate; (f) Treasury rate; or (g) such other base rate as may be specified in a supplement to the private placement agreement. The CP Program contains certain events of default including, among other things: non-payment of principal, interest or fees; entrance into any form of moratorium; and bankruptcy and insolvency events, subject in certain instances to cure periods. At March 31, 201 7, the Company has CP borrowings outstanding of $ 214.0 million with a weighted average maturity and interest rate of 20 days and 1.29 %, respectively. Notes Payable On March 2, 2017, the Company issued $ 300 million aggregate principal amount of senior unse cured notes in a public offering. The 2017 Floating Rate Senior Notes bear interest at a floating rate which is calculated as three-month LIBOR as determined on the interest determination date plus 0.35 %. The interest determination date for an interest per iod will be the second London business day preceding the first day of such interest period. The 2017 Floating Rate Senior Notes will mature on September 4, 2018. Interest on the 2017 Floating Rate Senior Notes will accrue from March 2, 2017, and will be pa id quarterly in arrears on June 4, 2017, September 4, 2017, December 4, 2017, March 4, 2018, June 4, 2018 and on the maturity date, to the record holders at the close of business on the business date preceding the interest payment date. The 2017 Floating R ate Senior Notes are not redeemable prior to their maturity. On March 2, 2017, the Company issued $ 500 million aggregate principal amount of senior unsecured notes in a public offering. The 2017 Senior Notes bear interest at a fixed rate of 2.75 % and matu re on December 15, 2021. Interest on the 2017 Senior Notes is due semiannually on June 15 and December 15 of each year, commencing June 15, 2017. The Company may prepay the 2017 Senior Notes, in whole or in part, at any time at a price equity to 100 % of th e principal amount being prepaid, plus accrued interest and a Make-Whole Amount. For both the 2017 Floating Rate Senior Notes and 2017 Senior Notes, 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 2017 Indenture, at a price equal to 101 % of the principal amount, thereof, plus accrued and unpaid interest to the date of purchase. The 2017 Indenture contains covenants t hat 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 201 7 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 201 7 Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiari es fail to pay the principal of any indebtedness (as defined in the 201 7 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 201 7 Indenture, the 2017 Floating Rate Senior notes and 201 7 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. In the first quarter of 2017, the Company repaid the Series 2007-1 Notes along with a M ake-W hole A mount of approximately $ 7 million. The repayment schedule for the Company’s borrowings is as follows: Year Ended December 31, 2010 Senior Notes 2012 Senior Notes 2013 Senior Notes 2014 Senior Notes (5-Year) 2014 Senior Notes (30-Year) 2015 Senior Notes (1) 2017 Floating Rate Senior Notes 2017 Senior Notes Commercial Paper Total 2017 (after March 31,) $ - $ - $ - $ - $ - $ - $ - $ - $ 214.0 $ 214.0 2018 - - - - - - 300.0 - - 300.0 2019 - - - 450.0 - - - - - 450.0 2020 500.0 - - - - - - - - 500.0 2021 - - - - - - - 500.0 - 500.0 Thereafter - 500.0 500.0 - 600.0 534.8 - - - 2,134.8 Total $ 500.0 $ 500.0 $ 500.0 $ 450.0 $ 600.0 $ 534.8 $ 300.0 $ 500.0 $ 214.0 $ 4,098.8 (1) Based on end of quarter FX rates Interest expense, net The following table summarizes the components of interest as presented in the consolidated statements of operations: Three Months Ended March 31, 2017 2016 Income $ 4.1 $ 2.9 Expense on borrowings (44.7) (34.6) UTPs and other tax related liabilities (2.1) (2.8) Capitalized 0.3 0.4 Total $ (42.4) $ (34.1) The following table shows the cash paid for interest: Three Months Ended March 31, 2017 2016 Interest paid* $ 74.7 $ 67.1 * Amount in 2017 includes an approximate $7 million Make-Whole Amount relating to the early repayment of the Series 2007-1 Notes The fair value and carrying value of the Company’s long-term debt as of March 31, 2017 and December 31, 2016 are as follows: March 31, 2017 December 31, 2016 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Series 2007-1 Notes $ - $ - $ 300.0 $ 308.9 2010 Senior Notes 500.9 547.9 502.6 548.3 2012 Senior Notes 495.4 537.2 495.3 535.3 2013 Senior Notes 495.4 546.2 495.2 539.9 2014 Senior Notes (5-Year) 447.9 455.7 448.8 456.2 2014 Senior Notes (30-Year) 597.4 666.2 597.4 661.5 2015 Senior Notes 531.3 547.7 523.7 534.8 2017 Senior Notes (5-Year) 494.7 499.7 - - 2017 Floating Rate Senior Notes 298.9 300.5 - - Total $ 3,861.9 $ 4,101.1 $ 3,363.0 $ 3,584.9 The fair value of the Company’s long-term debt is estimated based on quoted market prices for similar instruments . 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) | 3 Months Ended |
Mar. 31, 2017 | |
Summary of Total Indebtedness | March 31, 2017 Principal Amount Fair Value of Interest Rate Swap (1) Unamortized (Discount) Premium Unamortized Debt Issuance Costs Carrying Value Notes Payable: - 5.50% 2010 Senior Notes, due 2020 $ 500.0 $ 3.7 $ (1.3) $ (1.5) $ 500.9 4.50% 2012 Senior Notes, due 2022 500.0 (0.3) (2.3) (2.0) 495.4 4.875% 2013 Senior Notes, due 2024 500.0 - (2.0) (2.6) 495.4 2.75% 2014 Senior Notes (5-Year), due 2019 450.0 (0.2) (0.3) (1.6) 447.9 5.25% 2014 Senior Notes (30-Year), due 2044 600.0 - 3.3 (5.9) 597.4 1.75% 2015 Senior Notes, due 2027 534.8 - - (3.5) 531.3 2.75% 2017 Senior Notes, due 2021 500.0 - (1.5) (3.8) 494.7 2017 Floating Rate Senior Notes, due 2018 300.0 - (1.1) 298.9 Commercial Paper 214.0 - (0.2) - 213.8 Total debt $ 4,098.8 $ 3.2 $ (4.3) $ (22.0) $ 4,075.7 Current portion (213.8) Total long-term debt $ 3,861.9 December 31, 2016 Principal Amount Fair Value of Interest Rate Swap (1) Unamortized (Discount) Premium Unamortized Debt Issuance Costs Carrying Value Notes Payable: 6.06% Series 2007-1 Notes due 2017 $ 300.0 $ - $ - $ $ 300.0 5.50% 2010 Senior Notes, due 2020 500.0 5.5 (1.3) (1.6) 502.6 4.50% 2012 Senior Notes, due 2022 500.0 (0.2) (2.4) (2.1) 495.3 4.875% 2013 Senior Notes, due 2024 500.0 - (2.1) (2.7) 495.2 2.75% 2014 Senior Notes (5-Year), due 2019 450.0 0.9 (0.4) (1.7) 448.8 5.25% 2014 Senior Notes (30-Year), due 2044 600.0 - 3.3 (5.9) 597.4 1.75% 2015 Senior Notes, due 2027 527.4 - - (3.7) 523.7 Total long-term debt $ 3,377.4 $ 6.2 $ (2.9) $ (17.7) $ 3,363.0 Current portion (300.0) Total long-term debt $ 3,063.0 (1) The Company has entered into interest rate swaps on the 2010 Senior Notes, the 2012 Senior Notes and the 2014 Senior Notes (5-Year) which are more fully discussed in Note 7 above. |
Principal Payments Due on Long-Term Borrowings | Year Ended December 31, 2010 Senior Notes 2012 Senior Notes 2013 Senior Notes 2014 Senior Notes (5-Year) 2014 Senior Notes (30-Year) 2015 Senior Notes (1) 2017 Floating Rate Senior Notes 2017 Senior Notes Commercial Paper Total 2017 (after March 31,) $ - $ - $ - $ - $ - $ - $ - $ - $ 214.0 $ 214.0 2018 - - - - - - 300.0 - - 300.0 2019 - - - 450.0 - - - - - 450.0 2020 500.0 - - - - - - - - 500.0 2021 - - - - - - - 500.0 - 500.0 Thereafter - 500.0 500.0 - 600.0 534.8 - - - 2,134.8 Total $ 500.0 $ 500.0 $ 500.0 $ 450.0 $ 600.0 $ 534.8 $ 300.0 $ 500.0 $ 214.0 $ 4,098.8 (1) Based on end of quarter FX rates |
Summary of Components of Interest as Presented in Consolidated Statements of Operations | Three Months Ended March 31, 2017 2016 Income $ 4.1 $ 2.9 Expense on borrowings (44.7) (34.6) UTPs and other tax related liabilities (2.1) (2.8) Capitalized 0.3 0.4 Total $ (42.4) $ (34.1) |
Interest Paid | Three Months Ended March 31, 2017 2016 Interest paid* $ 74.7 $ 67.1 * Amount in 2017 includes an approximate $7 million Make-Whole Amount relating to the early repayment of the Series 2007-1 Notes |
Fair Value and Carrying Value of Long-Term Debt | March 31, 2017 December 31, 2016 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Series 2007-1 Notes $ - $ - $ 300.0 $ 308.9 2010 Senior Notes 500.9 547.9 502.6 548.3 2012 Senior Notes 495.4 537.2 495.3 535.3 2013 Senior Notes 495.4 546.2 495.2 539.9 2014 Senior Notes (5-Year) 447.9 455.7 448.8 456.2 2014 Senior Notes (30-Year) 597.4 666.2 597.4 661.5 2015 Senior Notes 531.3 547.7 523.7 534.8 2017 Senior Notes (5-Year) 494.7 499.7 - - 2017 Floating Rate Senior Notes 298.9 300.5 - - Total $ 3,861.9 $ 4,101.1 $ 3,363.0 $ 3,584.9 |
Summary of Total Indebtedness (
Summary of Total Indebtedness (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Principal Amount | $ 4,098.8 | $ 3,377.4 |
Fair Value of Interest Rate Swap | 3.2 | 6.2 |
Unamortized (Discount) Premium | (4.3) | (2.9) |
Unamortized Debt Issuance Costs | (22) | (17.7) |
Total Debt | 4,075.7 | |
Current portion | (213.8) | |
Total long-term debt | 3,861.9 | 3,363 |
Current portion of long-term debt | (300) | |
Total long-term debt, non-current | 3,861.9 | 3,063 |
Commercial Paper [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 214 | |
Unamortized Debt Issuance Costs | (0.2) | |
Total Debt | 213.8 | |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 300 | |
Total long-term debt | 300 | |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 500 | 500 |
Fair Value of Interest Rate Swap | 3.7 | 5.5 |
Unamortized (Discount) Premium | (1.3) | (1.3) |
Unamortized Debt Issuance Costs | (1.5) | (1.6) |
Total long-term debt | 500.9 | 502.6 |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 500 | 500 |
Fair Value of Interest Rate Swap | (0.3) | (0.2) |
Unamortized (Discount) Premium | (2.3) | (2.4) |
Unamortized Debt Issuance Costs | (2) | (2.1) |
Total long-term debt | 495.4 | 495.3 |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 500 | 500 |
Unamortized (Discount) Premium | (2) | (2.1) |
Unamortized Debt Issuance Costs | (2.6) | (2.7) |
Total long-term debt | 495.4 | 495.2 |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 450 | 450 |
Fair Value of Interest Rate Swap | (0.2) | 0.9 |
Unamortized (Discount) Premium | (0.3) | (0.4) |
Unamortized Debt Issuance Costs | (1.6) | (1.7) |
Total long-term debt | 447.9 | 448.8 |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 600 | 600 |
Unamortized (Discount) Premium | 3.3 | 3.3 |
Unamortized Debt Issuance Costs | (5.9) | (5.9) |
Total long-term debt | 597.4 | 597.4 |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 534.8 | 527.4 |
Unamortized Debt Issuance Costs | (3.5) | (3.7) |
Total long-term debt | 531.3 | $ 523.7 |
2017 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 500 | |
Unamortized (Discount) Premium | (1.5) | |
Unamortized Debt Issuance Costs | (3.8) | |
Total long-term debt | 494.7 | |
2017 Floating Rate Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 300 | |
Unamortized Debt Issuance Costs | (1.1) | |
Total long-term debt | $ 298.9 |
Summary of Total Indebtedness72
Summary of Total Indebtedness (Parenthetical) (Detail) | Mar. 31, 2017 | Dec. 31, 2016 |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 6.06% | |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 5.50% | 5.50% |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 4.50% | 4.50% |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 4.875% | 4.875% |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 2.75% | 2.75% |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 5.25% | 5.25% |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 1.75% | 1.75% |
2017 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Notes Payable, interest rate | 2.75% |
Principal Payments Due on Long-
Principal Payments Due on Long-Term Borrowings (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
2017 (after March 31,) | $ 214 | |
2,018 | 300 | |
2,019 | 450 | |
2,020 | 500 | |
2,021 | 500 | |
Thereafter | 2,134.8 | |
Total principal payment | 4,098.8 | $ 3,377.4 |
Commercial Paper [Member] | ||
Debt Instrument [Line Items] | ||
2017 (after March 31,) | 214 | |
Total principal payment | 214 | |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
2,020 | 500 | |
Total principal payment | 500 | 500 |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Thereafter | 500 | |
Total principal payment | 500 | 500 |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Thereafter | 500 | |
Total principal payment | 500 | 500 |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
2,019 | 450 | |
Total principal payment | 450 | 450 |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Thereafter | 600 | |
Total principal payment | 600 | 600 |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Thereafter | 534.8 | |
Total principal payment | 534.8 | $ 527.4 |
2017 Floating Rate Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
2,018 | 300 | |
Total principal payment | 300 | |
2017 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
2,021 | 500 | |
Total principal payment | $ 500 |
Summary of Components of Intere
Summary of Components of Interest as Presented in Consolidated Statements of Operations (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Debt Instrument [Line Items] | ||
Income | $ 4.1 | $ 2.9 |
Expense on borrowings | (44.7) | (34.6) |
Income (expense) on UTPs and other tax related liabilities | (2.1) | (2.8) |
Capitalized | 0.3 | 0.4 |
Total | $ (42.4) | $ (34.1) |
Interest Paid (Detail)
Interest Paid (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Debt Instrument [Line Items] | ||
Interest paid | $ 74.7 | $ 67.1 |
Fair Value and Carrying Value o
Fair Value and Carrying Value of Long-Term Debt (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Long term debt | $ 3,861.9 | $ 3,363 |
Estimated Fair Value | 4,101.1 | 3,584.9 |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 300 | |
Estimated Fair Value | 308.9 | |
2010 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 500.9 | 502.6 |
Estimated Fair Value | 547.9 | 548.3 |
2012 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 495.4 | 495.3 |
Estimated Fair Value | 537.2 | 535.3 |
2013 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 495.4 | 495.2 |
Estimated Fair Value | 546.2 | 539.9 |
2014 Senior Notes (5-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 447.9 | 448.8 |
Estimated Fair Value | 455.7 | 456.2 |
2014 Senior Notes (30-Year) [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 597.4 | 597.4 |
Estimated Fair Value | 666.2 | 661.5 |
2015 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 531.3 | 523.7 |
Estimated Fair Value | 547.7 | $ 534.8 |
2017 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 494.7 | |
Estimated Fair Value | 499.7 | |
2017 Floating Rate Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long term debt | 298.9 | |
Estimated Fair Value | $ 300.5 |
Interest Paid (Parenthetical) (
Interest Paid (Parenthetical) (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Series 2007-1 Notes [Member] | |
Debt Instrument [Line Items] | |
Prepayment penalities of notes | $ 7 |
Indebtedness - Additional Infor
Indebtedness - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Debt, aggregate principal amount | $ 4,098.8 | $ 3,377.4 |
Commercial Paper [Member] | ||
Debt Instrument [Line Items] | ||
Senior unsecured revolving credit facility | 1,000 | |
Debt, aggregate principal amount | $ 214 | |
Issuance Date of Debt | Aug. 3, 2016 | |
Commercial paper, interest rate | 1.29% | |
Commercial Paper [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Term of notes | 397 days | |
Commercial Paper [Member] | Weighted Average Interest Rate [Member] | ||
Debt Instrument [Line Items] | ||
Term of notes | 20 days | |
2017 Floating Rate Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt, aggregate principal amount | $ 300 | |
Maturity date of Senior Unsecured Notes | Sep. 4, 2018 | |
Issuance Date of Debt | Mar. 2, 2017 | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 | |
Percentage of principal amount being prepaid plus accrued and unpaid interest | 100.00% | |
Percentage of Principal Amount Plus Accrued and Unpaid Interest to Date of Purchase | 101.00% | |
Minimum Percentage of Aggregate Principal Amount | 25.00% | |
Percentage Included in Calculation of Senior Notes Floating Rate Plus LIBOR | 0.35% | |
2017 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Debt, aggregate principal amount | $ 500 | |
Senior Unsecured Notes, interest | 2.75% | |
Maturity date of Senior Unsecured Notes | Dec. 15, 2021 | |
Issuance Date of Debt | Mar. 2, 2017 | |
Debt aggregate amount for default in principal, interest or fail to pay | $ 50 | |
Percentage of principal amount being prepaid plus accrued and unpaid interest | 100.00% | |
Percentage of Principal Amount Plus Accrued and Unpaid Interest to Date of Purchase | 101.00% | |
Minimum Percentage of Aggregate Principal Amount | 25.00% | |
Series 2007-1 Notes [Member] | ||
Debt Instrument [Line Items] | ||
Prepayment penalities of notes | $ 7 |
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2017 | |
CONTINGENCIES | NOTE 14 . CONTINGENCIES Given the nature of their activities, Moody’s and its subsidiaries are subject to legal and tax proceedings, governmental, regulatory and legislative investigations and inquiries, and claims and litigation that are based on ratings assigned by MIS or that are otherwise incidental to the Company’s business. They periodically receive and respond to subpoenas and other inquiries which may relate to Moody’s activities or to activities of others that may result in claims and litigation, proceedings or investigat ions by private litigants or governmental, regulatory or legislative authorities. Moody’s also is subject to ongoing tax audits as addressed in Note 3 to the financial statements. Management periodically assesses the Company’s liabilities and contingencies in connection with these matters based upon the latest information available. For claims, litigation and proceedings and governmental investigations and inquiries not related to income taxes, the Company records liabilities in the consolidated financial s tatements when it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated and periodically adjusts these as appropriate . When the reasonable estimate of the loss is within a range of amounts, the minimum amoun t of the range is accrued unless some higher amount within the range is a better estimate than another amount within the range. In instances when a loss is reasonably possible but uncertainties exist related to the probable outcome and/or the amount or ran ge of loss, management does not record a liability but discloses the contingency if material. As additional information becomes available, the Company adjusts its assessments and estimates of such matters accordingly. Moody’s also discloses material pendin g legal proceedings pursuant to SEC rules and other pending matters as it may determine to be appropriate. In view of the inherent difficulty of assessing the potential outcome of legal proceedings, governmental, regulatory and legislative investigations a nd inquiries, claims and litigation and similar matters and contingencies, particularly when the claimants seek large or indeterminate damages or assert novel legal theories or the matters involve a large number of parties, the Company often cannot predict what the eventual outcome of the pending matters will be or the timing of any resolution of such matters. The Company also may be unable to predict the impact (if any) that any such matters may have on how its business is conducted, on its competitive pos ition 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 mat ters and the effects, if any, on its operations and financial condition and to accrue for and disclose such matters as and when required. However, because such matters are inherently unpredictable and unfavorable developments or resolutions can occur, the ultimate outcome of such matters, including the amount of any loss, may differ from those estimates. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2017 | |
SEGMENT INFORMATION | NOTE 16 SEGMENT INFORMATION The Company is organized into two operating segments: MIS and MA and a ccordingly, the Company reports in two reportable segments: MIS and MA. The MIS segment consists of five LOBs. The C FG, 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 LOB 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. 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 royalty 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 exclusively 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 reportab le segment’s share 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 segments. 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 f inancial metric utilized by the Company’s chief operating decision maker to assess the profitability of each reportable segment. Three Months Ended March 31, 2017 2016 MIS MA Eliminations Consolidated MIS MA Eliminations Consolidated Revenue $ 694.2 $ 310.7 $ (29.7) $ 975.2 $ 549.1 $ 293.8 $ (26.8) $ 816.1 Operating, SG&A 288.3 240.7 (29.7) 499.3 278.6 230.3 (26.8) 482.1 Adjusted Operating Income 405.9 70.0 - 475.9 270.5 63.5 - 334.0 Less: Depreciation and amortization 18.9 13.6 - 32.5 17.5 12.4 - 29.9 Operating income $ 387.0 $ 56.4 $ - $ 443.4 $ 253.0 $ 51.1 $ - $ 304.1 MIS and MA Revenue by Line of Business The table below presents revenue by LOB within each reportable segment: Three Months Ended March 31, 2017 2016 MIS: Corporate finance (CFG) $ 352.8 $ 240.3 Structured finance (SFG) 100.2 90.6 Financial institutions (FIG) 112.3 94.9 Public, project and infrastructure finance (PPIF) 98.1 91.5 Total ratings revenue 663.4 517.3 MIS Other 4.8 7.8 Total external revenue 668.2 525.1 Intersegment royalty 26.0 24.0 Total 694.2 549.1 MA: Research, data and analytics (RD&A) 175.4 164.9 Enterprise risk solutions (ERS) 95.9 89.5 Professional services (PS) 35.7 36.6 Total external revenue 307.0 291.0 Intersegment revenue 3.7 2.8 Total 310.7 293.8 Eliminations (29.7) (26.8) Total MCO $ 975.2 $ 816.1 Consolidated Revenue Information by Geographic Area: Three Months Ended March 31, 2017 2016 Revenue United States $ 577.8 $ 480.0 International: EMEA 236.3 210.2 Asia-Pacific 99.4 82.0 Americas 61.7 43.9 Total International 397.4 336.1 Total $ 975.2 $ 816.1 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Financial Information by Segment | Three Months Ended March 31, 2017 2016 MIS MA Eliminations Consolidated MIS MA Eliminations Consolidated Revenue $ 694.2 $ 310.7 $ (29.7) $ 975.2 $ 549.1 $ 293.8 $ (26.8) $ 816.1 Operating, SG&A 288.3 240.7 (29.7) 499.3 278.6 230.3 (26.8) 482.1 Adjusted Operating Income 405.9 70.0 - 475.9 270.5 63.5 - 334.0 Less: Depreciation and amortization 18.9 13.6 - 32.5 17.5 12.4 - 29.9 Operating income $ 387.0 $ 56.4 $ - $ 443.4 $ 253.0 $ 51.1 $ - $ 304.1 |
Revenue by Line of Business within Each Reportable Segment | Three Months Ended March 31, 2017 2016 MIS: Corporate finance (CFG) $ 352.8 $ 240.3 Structured finance (SFG) 100.2 90.6 Financial institutions (FIG) 112.3 94.9 Public, project and infrastructure finance (PPIF) 98.1 91.5 Total ratings revenue 663.4 517.3 MIS Other 4.8 7.8 Total external revenue 668.2 525.1 Intersegment royalty 26.0 24.0 Total 694.2 549.1 MA: Research, data and analytics (RD&A) 175.4 164.9 Enterprise risk solutions (ERS) 95.9 89.5 Professional services (PS) 35.7 36.6 Total external revenue 307.0 291.0 Intersegment revenue 3.7 2.8 Total 310.7 293.8 Eliminations (29.7) (26.8) Total MCO $ 975.2 $ 816.1 Three Months Ended March 31, 2017 2016 MIS: Corporate finance (CFG) $ 352.8 $ 240.3 Structured finance (SFG) 100.2 90.6 Financial institutions (FIG) 112.3 94.9 Public, project and infrastructure finance (PPIF) 98.1 91.5 Total ratings revenue 663.4 517.3 MIS Other 4.8 7.8 Total external revenue 668.2 525.1 Intersegment royalty 26.0 24.0 Total 694.2 549.1 MA: Research, data and analytics (RD&A) 175.4 164.9 Enterprise risk solutions (ERS) 95.9 89.5 Professional services (PS) 35.7 36.6 Total external revenue 307.0 291.0 Intersegment revenue 3.7 2.8 Total 310.7 293.8 Eliminations (29.7) (26.8) Total MCO $ 975.2 $ 816.1 |
Consolidated Revenue Information by Geographic Area | Consolidated Revenue Information by Geographic Area: Three Months Ended March 31, 2017 2016 Revenue United States $ 577.8 $ 480.0 International: EMEA 236.3 210.2 Asia-Pacific 99.4 82.0 Americas 61.7 43.9 Total International 397.4 336.1 Total $ 975.2 $ 816.1 |
Financial Information by Segmen
Financial Information by Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 975.2 | $ 816.1 |
Operating, SG&A | 499.3 | 482.1 |
Adjusted Operating Income | 475.9 | 334 |
Depreciation and amortization | 32.5 | 29.9 |
Operating Income | 443.4 | 304.1 |
Moodys Investors Service [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 694.2 | 549.1 |
Operating, SG&A | 288.3 | 278.6 |
Adjusted Operating Income | 405.9 | 270.5 |
Depreciation and amortization | 18.9 | 17.5 |
Operating Income | 387 | 253 |
Moodys Analytics [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 310.7 | 293.8 |
Operating, SG&A | 240.7 | 230.3 |
Adjusted Operating Income | 70 | 63.5 |
Depreciation and amortization | 13.6 | 12.4 |
Operating Income | 56.4 | 51.1 |
Intersegment Elimination [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | (29.7) | (26.8) |
Operating, SG&A | $ (29.7) | $ (26.8) |
Revenue by Line of Business wit
Revenue by Line of Business within Each Reportable Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 975.2 | $ 816.1 |
Moodys Investors Service [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 694.2 | 549.1 |
Moodys Investors Service [Member] | Corporate Finance [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 352.8 | 240.3 |
Moodys Investors Service [Member] | Structured Finance [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 100.2 | 90.6 |
Moodys Investors Service [Member] | Financial Institutions [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 112.3 | 94.9 |
Moodys Investors Service [Member] | Public Project And Infrastructure Finance [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 98.1 | 91.5 |
Moodys Investors Service [Member] | Rating Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 663.4 | 517.3 |
Moodys Investors Service [Member] | MIS Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 4.8 | 7.8 |
Moodys Investors Service [Member] | External Revenues [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 668.2 | 525.1 |
Moodys Investors Service [Member] | Intersegment Royality [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 26 | 24 |
Moodys Analytics [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 310.7 | 293.8 |
Moodys Analytics [Member] | Research Data And Analytics [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 175.4 | 164.9 |
Moodys Analytics [Member] | Enterprise Risk Solutions [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 95.9 | 89.5 |
Moodys Analytics [Member] | Professional Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 35.7 | 36.6 |
Moodys Analytics [Member] | External Revenues [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 307 | 291 |
Moodys Analytics [Member] | Intersegment Royality [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 3.7 | 2.8 |
Intersegment Elimination [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | $ (29.7) | $ (26.8) |
Consolidated Revenue Informatio
Consolidated Revenue Information by Geographic Area (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 975.2 | $ 816.1 |
U S | ||
Segment Reporting Information [Line Items] | ||
Revenues | 577.8 | 480 |
International Regions [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 397.4 | 336.1 |
International Regions [Member] | Europe Middle East And Africa [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 236.3 | 210.2 |
International Regions [Member] | Asia Pacific [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 99.4 | 82 |
International Regions [Member] | Americas [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | $ 61.7 | $ 43.9 |
RECENTLY ISSUED ACCOUNTING STAN
RECENTLY ISSUED ACCOUNTING STANDARDS | 3 Months Ended |
Mar. 31, 2017 | |
RECENTLY ISSUED ACCOUNTING STANDARDS | NOTE 16 . RECENTLY ISSUED ACCOUNTING STANDARDS In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”. This ASU outlines a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer 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. In August 2015, the FASB issued ASU No. 2015-14 “Revenue from Contracts with Customers (Topic 606), Deferral of the Effective 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 addition, during 2016, the FASB issued additional upd ates clarifying the implementation guidance for the new revenue recognition standard. The Company intends to adopt the new revenue guidance as of January 1, 2018 using the modified retrospective transition method. Under this adoption method, the Company will record a cumulative adjustment to retained earnings at January 1, 2018 and apply the provisions of the ASU prospectively. Currently, the Company believes this ASU will have an impact on, which is not limited to: i) the accounting for certain software subscription revenue in MA whereby the license rights within the arrangement would be recognized at the inception of the contract based on estimated stand-alone selling price with the remainder recognized over the subscription period (compared to ASC 605 whereby all software subscription revenue is currently recognized over the subscription period); ii) the accounting for certain ERS revenue arrangements where VSOE is not currently available under ASC 605 would result in the acceleration of revenue recognition (compared to ASC 605 whereby revenue is currently deferred due to lack of VSOE); iii) the capitalization of software implementation project costs to fulfill a contract for its ERS business which will be expensed as incurred under the new standard; and iv.) the amortization period for capitalized costs to obtain a contract in the MA segment . At Mar ch 31, 2017, the Company is progressing in assessing and documenting key changes to judgmental areas of its accounting policies relating to the adoption of the new revenue accounting standard. However, the quantitative impact of adopting this ASU is not c urrently known or reasonably estimable as the impact will be heavily dependent upon the status of contracts in-process primarily within the Company’s ERS LOB as of the date of adoption (the Company does not have any material software implementation arrange ments with terms longer than two years). Furthermore, the Company is in the process of upgrading its IT infrastructure in order to support the accounting under the new standard as well as assessing the impact that the new standard will have on its process es and internal controls. In January 2016, the FASB issued ASU No. 2016-01 “Financial Instruments—Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities”. The amendments in this ASU update various aspects of r ecognition, measurement, presentation and disclosures relating to financial instruments. This ASU 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 stateme nts. The Company believes that the most pertinent impact to its financial statements upon the adoption of this ASU will relate to the discontinuance of the available-for-sale classification for investments in equity securities (unrealized gains and losses were recorded through OCI). Accordingly, subsequent to adoption of this ASU, changes in the fair value of equity securities held by the Company will be recorded through earnings. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” requ iring lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses and cash flows will depend on classification as either a finance or operating lease. This ASU is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. This standard must be adopted using a modified retrospective approach whereby leases will be presented in accordance with the new standard as of the e arliest period presented. The Company is currently evaluating the impact of this ASU on the Company’s financial statements. The Company believes that the most notable impact to its financial statements upon the adoption of this ASU will be the recognition of a material right-of-use asset and lease liability for its real estate leases. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments”. The amendments in thi s ASU require the use of an “expected credit loss” impairment model for most financial assets reported at amortized cost which will require entities to estimate expected credit losses over the lifetime of the instrument. This may result in the earlier reco gnition of allowances for losses. For available-for-sale debt securities with unrealized losses, an allowance for credit losses will be recognized as a contra account to the amortized cost carrying value of the asset rather than a direct reduction to the c arrying value, with changes in the allowance impacting earnings. This ASU is effective for annual and interim reporting periods beginning after December 15, 2019, with early adoption permitted in annual and interim reporting periods beginning after Decembe r 15, 2018. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first effective reporting period. The Company is currently evaluating the impact of this ASU on its financial statem ents. Currently, the Company believes that the most notable impact of this ASU will relate to its processes around the assessment of the adequacy of its allowance for doubtful accounts on accounts receivable. In August 2016, the FASB issued ASU No. 2016-1 5, “Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments”. This ASU adds or clarifies guidance on the classification of certain cash receipts and payments in the statement of cash flows with the intent to alleviate diversity in practice for classifying various types of cash flows. This ASU is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. The Company will apply this clarification guidance in its s tatements of cash flows upon adoption. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805), Clarifying the Definition of a Business”. This ASU clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for annual and interim reporting periods beginning after December 15, 2017 and should be applied pro spectively. Upon adoption, the Company will apply the guidance in this ASU when evaluating whether acquired assets and activities constitute a business. In March 2017, the FASB issued ASU No. 2017-07, "Compensation—Retirement Benefits (Topic 715), Improvi ng the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost". This ASU impacts the presentation of net periodic pension costs in the statement of operations. Entities will be required to report the service cost component in the same line item or items as other compensation costs (either Operating or SG&A in Moody’s statement of operations). The other components of net benefit cost are required to be presented in the statement of operations separately from the service cost component and outside of operating income. The ASU permits only the service cost component of net periodic pension cost to be eligible for capitalization, when applicable. This ASU is effective for annual and interim reporting periods beginning after Dece mber 15, 2017. Upon adoption, the Company will bifurcate its net periodic pension costs reported in its statements of operations in accordance with this ASU. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2017 | |
SUBSEQUENT EVENTS | NOTE 17. SUBSEQUENT EVENT On April 25, 2017 , the Board approved the declaration of a quarterly dividend of $0.38 per share of Moody’s common stock, payable on June 12, 2017 to shareholders of record at the close of business on May 22, 2017 . |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2017$ / shares | |
Dividends Payable [Line Items] | |
Dividend declared, per share | $ 0.38 |
Dividend declared, declaration date | Apr. 25, 2017 |
Dividend declared, payable date | Jun. 12, 2017 |
Dividend declared, record date | May 22, 2017 |