Summary of Significant Accounting Policies | Summary of Significant Accounting Policies General Information and Basis of Presentation TravelCenters of America LLC, which we refer to as the Company or we, us and our, is a Delaware limited liability company. As of December 31, 2018 , we operated or franchised 301 travel centers and standalone restaurants. Our customers include trucking fleets and their drivers, independent truck drivers, highway and local motorists and casual diners. We also collect rents, royalties and other fees from our tenants and franchisees. As of December 31, 2018 , our business included 258 travel centers in 43 states in the United States, primarily along the U.S. interstate highway system, and the province of Ontario, Canada, operated primarily under the "TravelCenters of America," "TA," "TA Express," "Petro Stopping Centers" and "Petro" brand names. Of our 258 travel centers at December 31, 2018 , we owned 32 , we leased 201 , we operated two for a joint venture in which we own a noncontrolling interest and 23 were owned or leased from others by our franchisees. We operated 233 of our travel centers and franchisees operated 25 travel centers, including two we leased to franchisees. Our travel centers offer a broad range of products and services, including diesel fuel and gasoline, as well as nonfuel products and services such as truck repair and maintenance services, full service restaurants, quick service restaurants and various customer amenities. As of December 31, 2018 , our business included 43 standalone restaurants in 14 states in the United States operated primarily under the "Quaker Steak & Lube," or QSL, brand name. Of our 43 standalone restaurants at December 31, 2018 , we operated 16 restaurants ( seven we owned, eight we leased, and one we operated for a joint venture in which we own a noncontrolling interest) and 27 were owned or leased from others and operated by our franchisees. We manage our business as one segment. We make specific disclosures concerning fuel and nonfuel products and services because it facilitates our discussion of trends and operational initiatives within our business and industry. We have a single travel center located in a foreign country, Canada, that we do not consider material to our operations. On December 5, 2018 , we sold our 225 convenience stores, one standalone restaurant and certain related assets, or our convenience stores business, pursuant to an agreement we entered into on September 1, 2018 . As a result, the results of the convenience stores business are reported as a discontinued operation for all periods presented in the consolidated statements of operations and comprehensive (loss) income. Additionally, the assets and liabilities of the convenience stores business as of December 31, 2017, have been presented as a discontinued operation in our consolidated balance sheet. See Note 4 for more information about our discontinued operations. Our consolidated financial statements include the accounts of TravelCenters of America LLC and its subsidiaries. All intercompany transactions and balances have been eliminated. We use the equity method of accounting for investments in entities when we have the ability to significantly influence, but not control, the investee's operating and financial policies, typically when we own 20% to 50% of the investee's voting stock. See Note 12 for more information about our equity investments. The preparation of financial statements in conformity with U.S. generally accepted accounting principles, or GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant Accounting Policies Revenue Recognition. Revenues consist of fuel revenues, nonfuel revenues and rent and royalties from franchisees. See Note 2 for more information about our revenues. Accounts Receivable and Allowance for Doubtful Accounts. We record trade accounts receivable at the invoiced amount and those amounts do not bear interest. The recorded allowance for doubtful accounts is our best estimate of the amount of probable losses in our existing accounts receivable. We base the allowance on historical payment patterns, aging of accounts receivable, periodic review of customers' financial condition and actual write off history. We charge off account balances against the allowance when we believe it is probable the receivable will not be collected. Inventory. We state our inventory at the lower of cost or net realizable value. We determine cost principally on the weighted average cost method. We maintain reserves for the estimated amounts of obsolete and excess inventory. These estimates are based on unit sales histories and on hand inventory quantities, known market trends for inventory items and assumptions regarding factors such as future inventory needs, our ability and the related cost to return items to our suppliers and our ability to sell inventory at a discount when necessary. Property and Equipment. We record property and equipment as a result of business combinations based on their fair values as of the date of the acquisition. We record all other property and equipment at cost. We depreciate our property and equipment on a straight line basis generally over the following estimated useful lives of the assets: Buildings and site improvements 15 to 40 years Machinery and equipment 3 to 15 years Furniture and fixtures 5 to 10 years We depreciate leasehold improvements over the shorter of the lives shown above or the remaining term of the underlying lease. Amortization expense related to assets recorded in connection with the sale leaseback financing obligation pertaining to certain travel centers we lease from Hospitality Properties Trust, or HPT, is included in depreciation and amortization expense over the shorter of the estimated useful lives of the assets or the lease term. See Notes 9 and 14 for more information about our relationship and transactions with HPT. Goodwill and Intangible Assets. In a business combination we are required to record assets and liabilities acquired, including those intangible assets that arise from contractual or other legal rights or are otherwise capable of being separated or divided from the acquired entity, based on the fair values of the acquired assets and liabilities. Any excess of acquisition cost over the fair value of the acquired net identifiable assets is recognized as goodwill. We amortize the recorded costs of intangible assets with finite lives on a straight line basis over their estimated lives, principally the terms of the related contractual agreements. See Note 6 for more information about our goodwill and intangible assets. Impairment. We review definite lived assets for indicators of impairment during each reporting period. We recognize impairment charges when (i) the carrying value of a long lived asset or asset group to be held and used in the business is not recoverable and exceeds its fair value and (ii) when the carrying value of a long lived asset or asset group to be disposed of exceeds the estimated fair value of the asset less the estimated cost to sell the asset. Our estimates of fair value are based on our estimates of likely market participant assumptions, including projected fuel sales volumes, nonfuel revenues, fuel and nonfuel gross margins, site level operating expenses and real estate rent expense. The discount rate is used to measure the present value of projected future cash flows and is set at a rate we believe is likely to be used by a market participant using a weighted average cost of capital method that considers market and industry data as well as our specific risk factors. The weighted average cost of capital is our estimate of the overall after tax rate of return required by equity and debt holders of a business enterprise. We use a number of assumptions and methods in preparing valuations underlying impairment tests, and in some instances we may obtain third party appraisals. We recognize impairment charges in the period during which the circumstances surrounding an asset or asset group to be held and used have changed such that the carrying value is no longer recoverable, or during which a commitment to a plan to dispose of the asset or asset group is made. We perform our impairment analysis for substantially all of our property and equipment at the individual site level because that is the lowest level of asset and liability groupings for which the cash flows are largely independent of the cash flows of other assets and liabilities. During 2018 , we did not record any impairment charges related to our long lived assets. We assess intangible assets with definite lives for impairment annually or whenever events or changes in circumstances warrant a revision to the remaining period of amortization. Definite lived intangible assets include our agreements with franchisees and other intangible assets. For 2018 , definite lived intangible assets were assessed using a qualitative analysis that was performed by assessing certain trends and factors, including actual sales, collection of royalties from franchisees and any changes in the manner in which the assets were used that could impact the value of the asset. During 2018 , we did not record any impairment charges related to our definite lived intangible assets. We evaluate goodwill and indefinite lived intangible assets for impairment annually or whenever events or changes in circumstances indicate the carrying amount may not be recoverable using either a quantitative or qualitative analysis. Indefinite lived intangible assets consisted of trademarks and their fair value was determined using a relief from royalty method. We subject goodwill and indefinite lived intangible assets to further evaluation and recognize impairment charges when events and circumstances indicate the carrying value of the goodwill or indefinite lived intangible asset exceeds the fair market value of the asset. As of November 30, 2018 , indefinite lived intangible assets were assessed using a qualitative analysis that was performed by assessing certain trends and factors, including actual sales and operating profit margins, discount rates, industry data and other relevant qualitative factors. These trends and factors were compared to, and based on, the assumptions used in the most recent quantitative assessment. During 2018 , we did not record any impairment charges related to our indefinite lived intangible assets. We evaluate goodwill for impairment at the reporting unit level as of July 31, or more frequently if the circumstances warrant. With respect to goodwill, if we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we perform a goodwill impairment test to measure the amount of impairment to be recognized, if any. During the second quarter of 2018, prior to classifying our convenience stores business as held for sale and as a discontinued operation, we determined that the decline in site level gross margin in excess of site level operating expenses for our convenience stores business for the three and six months ended June 30, 2018, as compared to the three and six months ended June 30, 2017, in conjunction with the fact that the operating results for the convenience stores business failed to meet our forecasted results was an indicator of impairment of the goodwill in our convenience stores business. Accordingly, we performed an impairment assessment of the goodwill in the convenience stores business as of May 31, 2018, using a quantitative analysis under which the fair value of the convenience stores business was estimated using both an income approach and a market approach. The income approach considered discounted forecasted cash flows that were based on our long term operating plan. A terminal value was used to estimate the cash flows beyond the period covered by the operating plan. The discount rate is an estimate of the overall after tax market rate of return we believe may be required by equity and debt holders of a business enterprise. The market approach considered the estimated fair values of possible comparable publicly traded companies. For each comparable publicly traded company, value indicators, or pricing multiples, were considered to estimate the value of our business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows, including revenue growth rates and operating cash flow margins, of the respective reporting unit. Applying different assumptions could lead to different results. Based on this assessment, during the second quarter of 2018, we recorded an impairment charge of $51,500 , which is presented in loss from discontinued operations, net of taxes in our consolidated statements of operations and comprehensive (loss) income. On September 1, 2018, our Board of Directors approved the sale of our convenience stores business, which resulted in our convenience stores business being classified as held for sale, and we entered into an agreement to sell the convenience stores business. As a result of the agreed upon sales price, we recorded a goodwill impairment charge of $17,840 in the convenience stores reporting unit as of September 1, 2018. See Note 4 for more information about our discontinued operations. As of July 31, 2018, our annual goodwill impairment test for the travel center and QSL reporting units was performed using a qualitative analysis which included evaluating financial trends and industry and market conditions and assessing the reasonableness of the assumptions used in the most recent quantitative analysis, including comparing actual results to the projections used in the quantitative analysis. Based on our analyses, we concluded that as of July 31, 2018, our goodwill in those reporting units was not impaired. Share Based Employee Compensation. We have historically granted awards of our common shares under our share award plans. Share awards issued to our Directors vest immediately. Share awards made to others vest in five to ten equal annual installments beginning on the date of the award. Compensation expense related to share awards is determined based on the market value of our shares on either the date of the award for employees or the vesting date for nonemployees, as appropriate, with the aggregate value of the shares awarded amortized to expense over the related vesting period. We include share based compensation expense in selling, general and administrative expenses in our consolidated statements of operations and comprehensive (loss) income. Environmental Remediation. We record remediation charges and penalties when the obligation to remediate is probable and the amount of associated costs are reasonably determinable. We include remediation expenses within site level operating expenses in our consolidated statements of operations and comprehensive (loss) income. Generally, the timing of remediation expense recognition coincides with completion of a feasibility study or the commitment to a formal plan of action. Accrued liabilities related to environmental matters are recorded on an undiscounted basis because of the uncertainty associated with the timing of the related future payments. In our consolidated balance sheets, the accrual for environmental matters is included in other noncurrent liabilities, with the amount estimated to be expended within the subsequent 12 months included in other current liabilities. We recognize a receivable for estimated future environmental costs that we may be reimbursed for within other noncurrent assets in our consolidated balance sheets. Self Insurance Accruals. For insurance programs for which we pay deductibles and for which we are partially self insured up to certain stop loss amounts, we establish accruals for both estimated losses on known claims and claims incurred but not reported, based on claims histories and using actuarial methods. In our consolidated balance sheets, the accrual for self insurance costs is included in other noncurrent liabilities, with the amount estimated to be expended within the subsequent 12 months included in other current liabilities. Asset Retirement Obligations. We recognize the future costs for our obligations related to the removal of our underground storage tanks and certain improvements we own at leased properties over the estimated useful lives of each asset requiring removal. We record a liability for the fair value of an asset retirement obligation with a corresponding increase to the carrying value of the related long lived asset at the time such an asset is installed. We base the estimated liability on our historical experiences in removing these assets, their estimated useful lives, external estimates as to the cost to remove the assets in the future and regulatory or contractual requirements. The liability is a discounted liability using a credit adjusted risk free rate. Our asset retirement obligations at December 31, 2018 and 2017 , were $2,478 and $2,388 , respectively, and are presented in other noncurrent liabilities in our consolidated balance sheets. Leasing Transactions. Leasing transactions are a material part of our business. We have five leases with HPT. See Note 9 for more information about our leases with HPT and our accounting for them. We recognize rent under operating leases without scheduled rent increases as expense over the lease term as it becomes payable. Certain operating leases specify scheduled rent increases over the lease term or other lease payments that are not scheduled evenly throughout the lease term. We recognize the effects of those scheduled rent increases in rent expense over the lease term on an average, or straight line, basis. The rent payments resulting from our sales to HPT of improvements to the properties we lease from HPT are contingent rent. Other than at the travel centers where our leases are accounted for as sale leaseback financing obligations, we recognize the expense related to this contingent rent evenly throughout the remaining lease term beginning on the dates of the related sales to HPT. Income Taxes. We establish deferred income tax assets and liabilities to reflect the future tax consequences of differences between the tax basis and financial statement basis of assets and liabilities. We reduce the measurement of deferred tax assets, if necessary, by a valuation allowance when it is more likely than not that the deferred tax asset will not be realized. We recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. We evaluate and adjust these tax positions based on changing facts and circumstances. For tax positions meeting the more likely than not threshold, the amount we recognize in the financial statements is the largest benefit that we estimate has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. See Note 11 for more information about our income taxes. Reclassifications. Certain prior year amounts have been reclassified to be consistent with the current year presentation within our consolidated financial statements, including as a result of our adoption of a new accounting principle as described below. Change in Accounting Principles In May 2014, the Financial Accounting Standards Board, or the FASB, issued Accounting Standards Update, or ASU, 2014-09, Revenue from Contracts with Customers , or ASU 2014-09, which established a comprehensive revenue recognition standard under GAAP for almost all industries. We adopted ASU 2014-09 on January 1, 2018, using the full retrospective method, which required that we restate our consolidated financial statements for prior year comparative periods. Although the majority of our revenue is initiated at the point of sale and was unaffected by this ASU, the implementation of this ASU affected the accounting for our loyalty programs, initial and renewal franchise fees and advertising fees received from franchisees. See Note 2 for more information about our revenues. Customer Loyalty Programs. Prior to the adoption of ASU 2014-09, we recognized the estimated cost of loyalty awards as a discount against the nonfuel revenues for which the rewards were redeemed. Loyalty awards now are recognized against the revenue that generates the loyalty award, primarily fuel revenues. The adoption of the new standard resulted in a $58,861 reclassification between fuel revenue and nonfuel revenue for the year ended December 31, 2017 . Initial and Renewal Franchise Fees. Prior to the adoption of ASU 2014-09, we recognized initial franchise fees as revenue at the time the franchisee opened for business, which is when we had fulfilled our initial obligations under the related agreement, and recognized renewal fees at the time the franchisee's renewal period began. Initial and renewal franchise fees now are recognized as revenue over the term of the related franchise agreement, which is the period the customer benefits from use of the franchise rights. The adoption of the new standard resulted in an increase in our accumulated deficit of $1,082 , an increase in other current liabilities of $188 and an increase in other noncurrent liabilities of $894 as of December 31, 2017 , as well as an increase of $52 in rent and royalties from franchisees revenue for the year ended December 31, 2017 . Advertising Fees. Prior to the adoption of ASU 2014-09, we recognized advertising fees collected from franchisees as a reduction of the related advertising expenses incurred. We now recognize these advertising fees as revenue. The adoption of the new standard for these advertising fees resulted in an increase in each of selling, general and administrative expenses and rent and royalties from franchisees revenue of $1,684 for the year ended December 31, 2017 . Income Taxes. As a result of the adjustments described above, a deferred tax asset was recognized, increasing other noncurrent assets and decreasing our accumulated deficit each by $278 as of December 31, 2017 , and decreasing our benefit for income taxes by $163 for the year ended December 31, 2017 . The following table presents the effect of the adoption of the new standard on our consolidated balance sheet as of December 31, 2017 . As Reported Discontinued Operations (1) Adoption of ASU 2014-09 As Adjusted Assets: Other noncurrent assets $ 90,004 $ (327 ) $ 278 $ 89,955 Liabilities and Shareholders' Equity: Other current liabilities $ 130,140 $ (2,311 ) $ 188 $ 128,017 Other noncurrent liabilities 35,029 (8,547 ) 894 27,376 Accumulated deficit (125,416 ) — (804 ) (126,220 ) (1) See Note 4 for more information about our discontinued operations. The following table presents the effect of the adoption of the new standard on our consolidated statement of operations and comprehensive income for the year ended December 31, 2017 . As Reported Discontinued Operations (1) Adoption of ASU 2014-09 As Adjusted Revenues: Fuel $ 4,090,912 $ (474,514 ) $ (58,861 ) $ 3,557,537 Nonfuel 1,944,181 (261,703 ) 58,861 1,741,339 Rent and royalties from franchisees 16,500 (215 ) 1,736 18,021 Total revenues 6,051,593 (736,432 ) 1,736 5,316,897 Selling, general and administrative expenses 154,663 (10,332 ) 1,684 146,015 Loss before income taxes and discontinued operations (75,045 ) 14,645 52 (60,348 ) Benefit for income taxes 84,439 (4,026 ) (163 ) 80,250 Income from continuing operations 9,394 10,619 (111 ) 19,902 (1) See Note 4 for more information about our discontinued operations. The following table presents the effect of the adoption of the new standard on our consolidated statement of cash flows for the year ended December 31, 2017 . As Reported Discontinued Operations (1) Adoption of ASU 2014-09 As Adjusted Cash flows from operating activities: Net income $ 9,394 $ — $ (111 ) $ 9,283 Deferred income taxes (85,432 ) 4,026 163 (81,243 ) Accounts receivable (18,507 ) — 70 (18,437 ) Accounts payable and other liabilities 8,123 (4,125 ) (122 ) 3,876 Net cash provided by operating activities 35,674 — — 35,674 (1) See Note 4 for more information about our discontinued operations. We recognized a net increase in our accumulated deficit at January 1, 2016 , of $305 as a result of adopting ASU 2014-09. In January 2017, the FASB issued Accounting Standards Update 2017-04, Intangibles - Goodwill and Other , which simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The new standard will apply for annual or interim impairment tests beginning after December 15, 2019, and requires prospective application. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017, and we adopted this standard during the second quarter of 2018. Recently Issued Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases , or ASU 2016-02, which established a comprehensive lease standard under GAAP for virtually all industries. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases. This classification determines whether the lease expense is recognized based on the effective interest method or on a straight line basis over the term of the lease. A lessee is also required to recognize a right of use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard will apply for annual periods beginning after December 15, 2018, including interim periods therein. To address implementation of ASU 2016-02 and evaluate its impact on our consolidated financial statements, we developed a project plan and formed a team to evaluate our leases, lease classification and related internal controls. We implemented lease accounting software and elected the modified retrospective transition method for adoption, which does not require us to restate prior year comparative periods. We will apply the package of practical expedients included in ASU 2016-02; accordingly, we will retain the lease classification and initial direct costs for any leases that existed prior to adoption and we will not revisit whether any existing or expired contracts contain leases. We estimate adoption of the standard will result in recognition of right of use assets that total approximately $1,800,000 , lease liabilities that total approximately $1,900,000 and a decrease to our accumulated deficit of approximately $86,000 , net of tax, on our consolidated balance sheet as of January 1, 2019. As a result of adopting ASU 2016-02, we will no longer recognize amortization of our deferred gain from previous sale leaseback transactions as a credit to real estate rent expense, which totaled $10,128 for the year ended December 31, 2018. In June 2018, the FASB issued Accounting Standards Update 2018-07, Compensation - Stock Compensation , which aligns the accounting for share based payments to nonemployees with the accounting for share based payments to employees. The new standard is required for annual periods beginning after December 15, 2018, including interim periods therein, and requires modified retrospective application. Early adoption is permitted. The implementation of this update is not expected to cause a material change to our consolidated financial statements. |