Cubic 10-K 23 Nov 15 2015 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Sep. 30, 2015	Nov. 04, 2015	Mar. 31, 2015
Document and Entity Information
Entity Registrant Name	CUBIC CORP /DE/
Entity Central Index Key	26,076
Document Type	10-K
Document Period End Date	Sep. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 1,227,951,215
Entity Common Stock, Shares Outstanding		26,964,099
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	FY

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Net sales:
Products	$ 607,226	$ 583,937	$ 562,310
Services	823,819	814,415	799,097
Total net sales	1,431,045	1,398,352	1,361,407
Costs and expenses:
Products	451,295	424,682	425,793
Services	640,031	657,853	629,520
Selling, general and administrative expenses	212,518	181,672	165,230
Research and development	17,992	17,959	24,445
Amortization of purchased intangibles	27,550	22,602	16,680
Restructuring costs	6,272	1,094	8,139
Impairment of goodwill	0		50,865
Total costs and expenses	1,355,658	1,305,862	1,320,672
Operating income	75,387	92,490	40,735
Other income (expenses):
Interest and dividend income	1,809	1,396	1,576
Interest expense	(4,400)	(4,084)	(3,427)
Other income (expense), net	(885)	(391)	887
Income before income taxes	71,911	89,411	39,771
Income taxes	48,997	19,831	14,502
Net income	22,914	69,580	25,269
Less noncontrolling interest in income of VIE	29	89	183
Net income attributable to Cubic	$ 22,885	$ 69,491	$ 25,086
Net income per share attributable to Cubic
Basic (in dollars per share)	$ 0.85	$ 2.59	$ 0.94
Diluted (in dollars per share)	$ 0.85	$ 2.59	$ 0.94
Weighted average shares used in per share calculations:
Basic (in shares)	26,872	26,787	26,736
Diluted (in shares)	26,938	26,845	26,760

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net income	$ 22,914	$ 69,580	$ 25,269
Other comprehensive income (loss):
Adjustment to pension liability, net of tax	(15,791)	(1,085)	13,106
Foreign currency translation	(31,430)	(2,017)	974
Net unrealized gain (loss) on available-for-sale securities, net of tax			(2)
Change in net unrealized gains/losses from cash flow hedges:
Change in fair value of cash flow hedges, net of tax	1,574	748	2,977
Adjustment for net gains/losses realized and included in net income, net of tax	(817)	(215)	800
Total change in net unrealized gains/losses from cash flow hedges, net of tax	757	533	3,777
Total other comprehensive income (loss)	(46,464)	(2,569)	17,855
Total comprehensive income (loss)	$ (23,550)	$ 67,011	$ 43,124

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2015	Sep. 30, 2014
Current assets:
Cash and cash equivalents	$ 218,476	$ 191,488
Restricted cash	69,245	69,056
Marketable securities	30,533	25,557
Accounts receivable:
Trade and other receivables	12,812	30,593
Long-term contracts	346,292	364,075
Allowance for doubtful accounts	(179)	(489)
Accounts receivable - net	358,925	394,179
Recoverable income taxes	753	16,055
Inventories	63,700	38,775
Deferred income taxes	1,384	10,324
Prepaid expenses and other current assets	32,286	19,953
Total current assets	775,302	765,387
Long-term contract receivables	36,809	15,870
Long-term capitalized contract costs	73,017	76,209
Property, plant and equipment, net	74,690	64,149
Deferred income taxes	11,443	17,849
Goodwill	237,899	184,141
Purchased intangibles, net	72,936	63,618
Miscellaneous other assets	18,180	7,383
Total assets	1,300,276	1,194,606
Current liabilities:
Short-term borrowings	60,000
Trade accounts payable	47,170	31,344
Customer advances	77,083	91,690
Accrued compensation	51,065	48,812
Other current liabilities	92,854	84,555
Income taxes payable	4,675	12,737
Deferred income taxes	13,404	474
Current maturities of long-term debt	525	563
Total current liabilities	346,776	270,175
Long-term debt	126,180	101,827
Accrued pension liability	26,025	17,219
Deferred compensation	9,913	9,501
Income taxes payable	8,519	6,324
Deferred income taxes	1,971	1,152
Other non-current liabilities	$ 24,604	$ 5,907
Commitments and contingencies
Shareholders' equity:
Preferred stock, no par value: Authorized--5,000 shares Issued and outstanding--none
Common stock, no par value: Authorized--50,000 shares,35,828 issued and 26,883 outstanding at September 30, 2015; 35,734 issued and 26,789 outstanding at September 30, 2014	$ 25,560	$ 20,669
Retained earnings	818,642	803,059
Accumulated other comprehensive loss	(51,836)	(5,372)
Treasury stock at cost - 8,945 shares	(36,078)	(36,078)
Shareholders' equity related to Cubic	756,288	782,278
Noncontrolling interest in variable interest entity		223
Total shareholders' equity	756,288	782,501
Total liabilities and shareholders' equity	$ 1,300,276	$ 1,194,606

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2015	Sep. 30, 2014
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred stock, par value	$ 0	$ 0
Preferred stock, Issued shares	0	0
Preferred stock, outstanding shares	0	0
Common stock, par value	$ 0	$ 0
Common stock, Authorized shares	50,000	50,000
Common stock, Issued shares	35,828	35,734
Common stock, outstanding shares	26,883	26,789
Treasury stock, shares	8,945	8,945

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Operating Activities:
Net income	$ 22,914	$ 69,580	$ 25,269
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	37,662	30,440	25,359
Stock-based compensation expense	8,325	5,625	3,251
Change in fair value of contingent consideration	3,607
Inventory write-down		598	2,760
Impairment of goodwill	0		50,865
Deferred income taxes	33,816	2,684	(7,508)
Excess tax benefits from equity incentive plans	33	(310)
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable	(2,230)	(4,300)	(18,991)
Inventories	(21,669)	20,590	(19,890)
Prepaid expenses and other current assets	(18,269)	(8,114)	3,867
Long-term capitalized contract costs	3,192	(7,246)	(42,088)
Accounts payable and other current liabilities	25,599	6,505	(25,637)
Customer advances	(10,200)	7,304	8,990
Income taxes	8,847	(9,768)	(19,114)
Other items, net	(1,938)	1,222	(409)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	89,689	114,810	(13,276)
Investing Activities:
Acquisition of businesses, net of cash acquired	(92,178)	(83,456)	(63,691)
Purchases of marketable securities	(58,855)	(25,557)	(4,050)
Proceeds from sales or maturities of marketable securities	51,173	4,050
Purchases of property, plant and equipment	(22,202)	(16,620)	(9,052)
Purchases of other assets	(2,993)
NET CASH USED IN INVESTING ACTIVITIES	(125,055)	(121,583)	(76,793)
Financing Activities:
Proceeds from short-term borrowings	111,300	38,000	70,000
Principal payments on short-term borrowings	(51,300)	(38,000)	(70,000)
Proceeds from long-term borrowings	25,000		100,000
Principal payments on long-term borrowings	(537)	(573)	(8,543)
Proceeds from issuance of common stock		113
Purchase of common stock	(2,652)	(1,204)
Excess tax benefits from equity incentive plans	(33)	310
Contingent consideration payments related to acquisitions of businessess		(2,368)	(7,842)
Purchase of noncontrolling interest	(1,029)
Net change in restricted cash	(189)	325	(158)
Dividends paid to shareholders	(7,256)	(6,429)	(6,417)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES	73,304	(9,826)	77,040
Effect of exchange rates on cash	(10,950)	4,195	4,654
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	26,988	(12,404)	(8,375)
Cash and cash equivalents at the beginning of the year	191,488	203,892	212,267
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	218,476	191,488	203,892
NEK Special Programs Group LLC (NEK)
Operating Activities:
Net income		(600)	(500)
Supplemental disclosure of non-cash investing and financing activities:
Liability incurred to acquire, net			$ 4,490
DTECH LABS, Inc.
Operating Activities:
Net income	(500)
Supplemental disclosure of non-cash investing and financing activities:
Liability incurred to acquire, net	11,808
Intific Inc.
Operating Activities:
Net income	$ (1,800)	(4,200)
Supplemental disclosure of non-cash investing and financing activities:
Liability incurred to acquire, net		$ 1,173

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Common Stock	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Noncontrolling Interest in VIE	Total
Balance at Sep. 30, 2012	$ 12,574	$ 721,333	$ (20,658)	$ (36,078)	$ (49)
Balance (in shares) at Sep. 30, 2012	26,736
Increase (Decrease) in Stockholders' Equity
Net income		25,086			183	$ 25,086
Other comprehensive loss, net of tax			17,855
Stock- based compensation	$ 3,251
Cash dividends paid		(6,417)
Balance at Sep. 30, 2013	$ 15,825	740,002	(2,803)	(36,078)	134
Balance (in shares) at Sep. 30, 2013	26,736
Increase (Decrease) in Stockholders' Equity
Net income		69,491			89	69,491
Other comprehensive loss, net of tax			(2,569)
Stock issued under equity incentive plans, value	$ 113	(5)
Stock issued under equity incentive plans, shares	75
Purchase of common stock, value	$ (1,204)
Purchase of common stock, shares	(22)
Stock- based compensation	$ 5,625
Tax benefit (expense) from equity incentive plans	310
Cash dividends paid		(6,429)
Balance at Sep. 30, 2014	$ 20,669	803,059	(5,372)	(36,078)	223	782,501
Balance (in shares) at Sep. 30, 2014	26,789
Increase (Decrease) in Stockholders' Equity
Net income		22,885			29	22,885
Other comprehensive loss, net of tax			(46,464)
Stock issued under equity incentive plans, value		(46)
Stock issued under equity incentive plans, shares	160
Purchase of common stock, value	$ (2,652)
Purchase of common stock, shares	(66)
Stock- based compensation	$ 8,325
Purchase of noncontrolling interest	(749)				$ (252)
Tax benefit (expense) from equity incentive plans	(33)
Cash dividends paid		(7,256)
Balance at Sep. 30, 2015	$ 25,560	$ 818,642	$ (51,836)	$ (36,078)		$ 756,288
Balance (in shares) at Sep. 30, 2015	26,883

CONSOLIDATED STATEMENTS OF CHA8

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Cash dividends paid, per share of common stock	$ 0.27	$ 0.24	$ 0.24

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Sep. 30, 2015
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Nature of the Business : We design, develop and manufacture products which are mainly electronic in nature such as mass transit fare collection systems, air and ground combat training systems, and secure communications products. We provide services such as specialized military training exercises, including live, virtual and constructive training exercises and support, and we operate and maintain fare systems for mass transit customers. Our principal lines of business are transportation fare collection systems and services, defense services, and defense systems. Our principal customers for defense products and services are the U.S. and foreign governments. Our transportation fare collection systems and services are sold primarily to large local government agencies worldwide. In February 2015, we implemented a plan to restructure our defense services and defense systems businesses into a single business called Cubic Global Defense (CGD) to better align our defense business organizational structure with customer requirements, increase operational efficiencies and improve collaboration and innovation across the company. After this restructuring there is now a single, combined management structure for our legacy Cubic Defense Systems (CDS) and legacy Mission Support Services (MSS) segments. However, for segment financial reporting purposes, we continue to report the financial results of our defense systems and defense services segments separately. These two reporting segments have been renamed Cubic Global Defense Systems (CGD Systems) and Cubic Global Defense Services (CGD Services), respectively. There have been no significant changes in the operations that are included in each of these reporting segments as a result of the restructuring. Principles of Consolidation : The consolidated financial statements include the accounts of Cubic Corporation, its majority-owned subsidiaries, and variable interest entities (VIE’s) for which Cubic is the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. Foreign Currency Transactions and Translation : Our reporting currency is the U.S. dollar. Assets and liabilities of foreign subsidiaries are translated at the spot rate in effect at the applicable reporting date, and our Consolidated Statements of Income are translated at the average exchange rates in effect during the applicable periods. The resulting unrealized cumulative translation adjustments are recorded as a component of other comprehensive income (loss) in our Consolidated Statements of Comprehensive Income (Loss). Cash flows from our operations in foreign countries are translated at the average rate for the applicable period. The effect of exchange rates on cash balances held in foreign currencies are separately reported in our Consolidated Statements of Cash Flows. Transactions denominated in currencies other than our own subsidiaries’ functional currencies are recorded based on exchange rates at the time such transactions arise. Changes in exchange rates with respect to amounts recorded in our Consolidated Balance Sheets related to such transactions result in transaction gains and losses that are reflected in our Consolidated Statements of Income as either unrealized (based on the applicable period end translation) or realized (upon settlement of the transactions). Total transaction losses, which are related primarily to advances to foreign subsidiaries and advances between foreign subsidiaries amounted to $3.2 million, $1.3 million and $0.8 million in 2015, 2014 and 2013, respectively. Use of Estimates : The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include the estimated total costs at completion of our long-term contracts, estimated loss contingencies, estimated self-insurance liabilities, estimated discounted future cash flows of our reporting units used for goodwill impairment testing and estimated future cash flows for our long-lived asset impairment testing, estimated discounted cash flows used for valuation of intangible assets in business combinations, and estimated rates of return and discount rates related to our defined benefit pension plans. Actual results could differ from our estimates. Cash Equivalents : We consider highly liquid investments with maturity of three months or less when purchased to be cash equivalents. In fiscal 2015, we determined that $24.4 million of bank time deposits with maturities in excess of three months, which should have been classified as marketable securities, were inappropriately classified as cash equivalents in our September 30, 2014 Consolidated Balance Sheet. The purchases of these bank time deposits were inappropriately not presented as purchases of marketable securities in the investing section of our Consolidated Statement of Cash Flows for the year ended September 30, 2014. Based upon a quantitative and qualitative assessment of this error, we have determined that this error was not material to our Consolidated Financial Statements, and we have corrected the classification in the September 30, 2014 Balance Sheet, Statement of Cash Flows, and related footnote in the accompanying Consolidated Financial Statements. Restricted Cash : Restricted cash represents cash that is restricted as to withdrawal usage for legal or contractual reasons. Restricted cash is classified either as current or non-current, depending upon the date of the lapse of the respective restriction. Concentration of Credit Risk : We have established guidelines pursuant to which our cash and cash equivalents are diversified among various money market instruments and investment funds. These guidelines emphasize the preservation of capital by requiring minimum credit ratings assigned by established credit organizations. We achieve diversification by specifying maximum investments in each instrument type and issuer. The majority of these investments are not on deposit in federally insured accounts. Marketable Securities : Marketable securities consist of time deposits with banks. Marketable securities are classified and accounted for as available-for-sale. These investments are recorded at fair value in the accompanying Consolidated Balance Sheets and the change in fair value is recorded, net of taxes, as a component of other comprehensive income. There have been no significant realized or unrealized gains or losses on these marketable securities to date. Marketable securities have been classified as current assets in the accompanying Consolidated Balance Sheets based upon the nature of the securities and availability for use in current operations. Accounts Receivable : Receivables consist primarily of amounts due from U.S. and foreign governments for defense products and services and local government agencies for transportation systems. Due to the nature of our customers, we generally do not require collateral. We have limited exposure to credit risk as we have historically collected substantially all of our receivables from government agencies. We generally require no allowance for doubtful accounts for these customers. Inventories : We state our inventories at the lower of cost or market. We determine cost using the first-in, first-out (FIFO) method, which approximates current replacement cost. We value our work in process at the actual production and engineering costs incurred to date, including applicable overhead. For contracts with the U.S. government our work in process also includes general and administrative costs. Any inventoried costs in excess of estimated realizable value are immediately charged to cost of sales. Where contracts include advances, performance-based payments and progress payments, we reflect the advances as an offset against any related inventory balances. We include qualifying contract costs allocable to units-of-delivery contracts as inventory. We also receive performance-based payments and progress payments associated with certain of these contracts based on the billing terms in the underlying contracts. Pursuant to contract provisions, agencies of the U.S. government and certain other customers have title to, or security interest in, inventories related to such contracts as a result of advances, performance-based payments, and progress payments. Contract advances, performance-based payments and progress payments received are recorded as an offset against the related inventory balances for contracts that that are accounted for on a percentage-of-completion basis using units-of-delivery as the basis to measure progress toward completing the contract. This determination is performed on a contract by contract basis. Any amount of payments received in excess of the cumulative amount of accounts receivable and inventoried costs for a contract is classified as customer advances, which is classified as a liability on the balance sheet. Long-term capitalized contract costs : Long-term capitalized contract costs include costs incurred on contracts to develop and manufacture transportation systems for customers for which revenue recognition does not begin until the customers begin operating the systems. These capitalized costs are being recognized in cost of sales based upon the ratio of revenue recorded during a period compared to the revenue expected to be recognized over the term of the contracts. Property, Plant and Equipment : We carry property, plant and equipment at cost. We provide depreciation in amounts sufficient to amortize the cost of the depreciable assets over their estimated useful lives. Generally, we use straight-line methods for depreciable real property over estimated useful lives or the term of the underlying lease for leasehold improvements. We use accelerated methods (declining balance and sum-of-the-years-digits) for machinery and equipment over their estimated useful lives. Certain costs incurred in the development of internal-use software and software applications, including external direct costs of materials and services and applicable compensation costs of employees devoted to specific software development, are capitalized as computer software costs. Costs incurred outside of the application development stage are expensed as incurred. The amounts capitalized are included in property, plant and equipment and are amortized on a straight-line basis over the estimated useful life of the software, which ranges from three to seven years. No amortization expense is recorded until the software is ready for its intended use. Goodwill and Purchased Intangibles : We evaluate goodwill for potential impairment annually as of July 1, or when circumstances indicate that the carrying value may not be recoverable. The test is performed by comparing the fair value of each of our reporting units, which are consistent with our operating segments, to its carrying value, including recorded goodwill. If the carrying value exceeds the fair value, we measure impairment by comparing the implied fair value of goodwill to its carrying value, and any impairment determined would be recorded in the current period. Our purchased intangible assets are subject to amortization and we use a combination of straight-line and accelerated methods, based on the expected cash flows from the assets. See Note 7 for a discussion of the impairment of our goodwill in 2013. Impairment of Long-Lived Assets : We generally evaluate the carrying values of long-lived assets other than goodwill for impairment only if events or changes in facts and circumstances indicate that carrying values may not be recoverable. If we determined there was any impairment, we would measure it by comparing the fair value of the related asset to its carrying value and record the difference in the current period. Fair value is generally determined by identifying estimated discounted cash flows to be generated by those assets. We have not recorded any impairment of long-lived assets for the years ended September 30, 2015, 2014 and 2013. Recognizing assets acquired and liabilities assumed in a business combination : Acquired assets and assumed liabilities are recognized in a business combination on the basis of their fair values at the date of acquisition. We assess fair value, which is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, using a variety of methods including income approaches such as present value techniques or cost approaches such as the estimation of current selling prices and replacement values. Fair value of the assets acquired and liabilities assumed, including intangible assets, and contingent payments, are measured based on the assumptions and estimations with regards to the variable factors such as the amount and timing of future cash flows for the asset or liability being measured, appropriate risk-adjusted discount rates, nonperformance risk, or other factors that market participants would consider. Upon acquisition, we determine the estimated economic lives of the acquired intangible assets for amortization purposes, which are based on the underlying expected cash flows of such assets. Adjustments to inventory are based on the fair market value of inventory and amortized into income based on the period in which the underlying inventory is sold. Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Actual results may vary from projected results and assumptions used in the fair value assessments. Customer Advances : We receive advances, performance-based payments and progress payments from customers that may exceed revenues recognized on certain contracts, including contracts with agencies of the U.S. government. We classify such advances, other than those reflected as a reduction of receivables or inventories, as current liabilities. Contingencies : We establish reserves for loss contingencies when, in the opinion of management, the likelihood of liability is probable and the extent of such liability is reasonably estimable. Estimates, by their nature, are based on judgment and currently available information and involve a variety of factors, including the type and nature of the litigation, claim or proceeding, the progress of the matter, the advice of legal counsel, our defenses and our experience in similar cases or proceedings as well as our assessment of matters, including settlements, involving other defendants in similar or related cases or proceedings. We may increase or decrease our legal reserves in the future, on a matter-by-matter basis, to account for developments in such matters. Derivative Financial Instruments : All derivatives are recorded at fair value, however, the classification of gains and losses resulting from changes in the fair values of derivatives are dependent on the intended use of the derivative and its resulting designation. If a derivative is designated as a fair value hedge, then a change in the fair value of the derivative is offset against the change in the fair value of the underlying hedged item and only the ineffective portion of the hedge, if any, is recognized in cost of sales. If a derivative is designated as a cash flow hedge, then the effective portion of a change in the fair value of the derivative is recognized as a component of accumulated other comprehensive income until the underlying hedged item is recognized in cost of sales, or the forecasted transaction is no longer probable of occurring. If a derivative does not qualify as a highly effective hedge, a change in fair value is immediately recognized in earnings. We formally document hedging relationships for all derivative hedges and the underlying hedged items, as well as the risk management objectives and strategies for undertaking the hedge transactions. Defined Benefit Pension Plans : Some of our employees are covered by defined benefit pension plans. The net periodic cost of our plans is determined using several actuarial assumptions, the most significant of which are the discount rate and the long-term rate of return on plan assets. We recognize on a plan-by-plan basis the funded status of our defined benefit pension plans as either an asset or liability on our balance sheets, with a corresponding adjustment to accumulated other comprehensive income (loss), net of tax, in shareholders’ equity. The funded status is measured as the difference between the fair value of the plan assets and the benefit obligation of the plan. Comprehensive Income : Other comprehensive income (loss), which is comprised of unrealized gains and losses on foreign currency translation adjustments, unrealized gains and losses on cash flow hedges, net of tax, unrealized gains and losses on available-for-sale securities, net of tax and pension liability adjustments, net of tax is included in our Consolidated Statement of Comprehensive Income as other comprehensive income (loss). Revenue Recognition : We generate revenue from the sale of products such as mass transit fare collection systems, air and ground combat training systems, and secure communications products. We also generate revenue from services we provide such as specialized military training exercises, including live, virtual and constructive training exercises and support, and we operate and maintain fare systems for mass transit customers. We classify sales as products or services in our Consolidated Statements of Income based on the attributes of the underlying contracts. We recognize sales and profits under our long-term fixed-price contracts which require a significant amount of development effort in relation to total contract value using the cost-to-cost percentage-of-completion method of accounting. We record sales and profits based on the ratio of contract costs incurred to estimated total contract costs at completion. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. For contracts with the U.S. federal government, general and administrative costs are included in contract costs; however, for purposes of revenue measurement, general and administrative costs are not considered contract costs for any other customers. Costs are recognized as incurred for contracts accounted for under the cost- to-cost percentage-of-completion method. For certain other long-term, fixed price production contracts not requiring substantial development effort we use the units-of-delivery percentage-of-completion method as the basis to measure progress toward completing the contract and recognizing sales. The units-of delivery measure recognizes revenues as deliveries are made to the customer generally using unit sales values in accordance with the contract terms. Costs of sales are recorded as deliveries are made. We estimate profit as the difference between total estimated revenue and total estimated cost of a contract and recognize that profit over the life of the contract based on deliveries. For long-term fixed price contracts, we only include amounts representing contract change orders, claims or other items in the contract value when they can be reliably estimated and we consider realization probable. Changes in estimates of sales, costs and profits are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes on current and prior periods. A significant change in one or more of these estimates could have a material effect on our consolidated financial position or results of operations. We record sales under cost-reimbursement-type contracts as we incur the costs. The Federal Acquisition Regulations provide guidance on the types of costs that we will be reimbursed in establishing the contract price. We consider incentives or penalties and awards applicable to performance on contracts in estimating sales and profits, and record them when there is sufficient information to assess anticipated contract performance. We do not recognize incentive provisions that increase or decrease earnings based solely on a single significant event until the event occurs. We occasionally enter into contracts that include multiple deliverables such as the construction or upgrade of a system and subsequent services to operate and maintain the delivered system. For such contracts, arrangement consideration is allocated at the inception of the arrangement to all deliverables using the relative-selling-price method. Under the relative-selling-price method, the selling price for each deliverable is determined using vendor specific objective evidence (VSOE) of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence of selling price exists for a deliverable, which is typically the case for our contracts, the guidance requires us to determine the best estimate of the selling price, which is the price at which we would sell the deliverable if it were sold on a standalone basis. In estimating the selling price of the deliverable on a standalone basis, we consider our overall pricing models and objectives, including the factors we contemplate in negotiating our contracts with our customers. The pricing models and objectives that we use are generally based upon a cost-plus margin approach, with the estimated margin based in part on qualitative factors such as perceived customer pricing sensitivity and competitive pressures. Once the contract value is allocated to the separate deliverables under a multiple-element arrangement, revenue recognition guidance relevant to each contractual element is followed. For example, for the long-term construction portion of a contract we generally use the percentage-of completion method and for the services portion we generally recognize the service revenues on a straight-line basis over the contractual service period or based on measurable units of work performed or incentives earned. For certain of our multiple-element arrangements, the contract specifies that we will not be paid upon the delivery of certain units of accounting, but rather we will be paid when subsequent performance obligations are satisfied. Generally, in these cases the allocation of arrangement consideration to the up-front deliverables is limited, in some cases to zero, and revenue is reduced, in some cases to zero for the delivery of up-front units of accounting. In such situations, if the costs associated with the delivered item exceed the amount of allocable arrangement consideration, we defer the direct and incremental costs associated with the delivered item that are in excess of the allocated arrangement consideration as capitalized contract costs. We assess recoverability of these costs by comparing the recorded asset to the deferred revenue in excess of the transaction price allocated to the remaining deliverables in the arrangement. Capitalized contract costs are subsequently recognized in income in a manner that is consistent with revenue recognition pattern for the arrangement as a whole. If no pattern of revenue recognition can be reasonably predicted for the arrangement, the capitalized costs are amortized on a straight-line basis. Revenue under our service contracts with the U.S. government is recorded under the cost-to cost percentage-of-completion method. Award fees and incentives related to performance under these service contracts are accrued during the performance of the contract based on our historical experience and estimates of success with such awards. Revenue under contracts for services other than those with the U.S. government and those associated with design, development, or production activities is recognized either as services are performed or when a contractually required event has occurred, depending on the contract. For such contracts that contain measurable units of work performed we recognize sales when the units of work are completed. Certain of our transportation systems service contracts contain service level or system usage incentives, for which we recognize revenues when the incentive award is fixed or determinable. These contract incentives are generally based upon monthly service levels or monthly performance and become fixed or determinable on a monthly basis. However, one of our transportation systems service contracts contains annual system usage incentives which are based upon system usage compared to annual baseline amounts. For this contract the annual system usage incentives are not considered fixed or determinable until the end of the contract year for which the incentives are measured, which falls within the second quarter of our fiscal year. Revenue under such contracts that do not contain measurable units of work performed, which is generally the case for our service contracts, is recognized on a straight- line basis over the contractual service period, unless evidence suggests that the revenue is earned, or obligations fulfilled, in a different manner. Costs incurred under these services contracts are expensed as incurred. We make provisions in the current period to fully recognize any anticipated losses on contracts. If we receive cash on a contract prior to revenue recognition or in excess of inventoried costs, we classify it as a customer advance on the balance sheet. In addition, we are subject to audit of incurred costs related to many of our U.S. government contracts. These audits could produce different results than we have estimated for revenue recognized on our cost-based contracts with the U.S. government; however, our experience has been that our costs are acceptable to the government. Research and Development (R&D) : We record the cost of company sponsored R&D activities as the expenses are incurred. The cost of engineering and product development activities incurred in connection with the performance of work on our contracts is included in cost of sales as they are directly related to contract performance. Stock-Based Compensation : Restricted stock units awards (RSUs) are granted to eligible employees and directors and represent rights to receive shares of common stock at a future date if vesting occurs. RSUs granted to date have either time-based vesting or performance-based vesting. Compensation expense for all RSUs is measured at fair value at the grant date and recognized based upon the number of RSUs that ultimately vest. We determine the fair value of RSUs based on the closing market price of our common stock on the grant date. The grant date of the performance-based RSUs takes place when the grant is authorized and the specific achievement goals are communicated. Compensation expense for time-based vesting awards is recorded on a straight-line basis over the requisite service period, adjusted by estimated forfeiture rates. Vesting of performance-based RSUs is tied to achievement of specific company goals over the measurement period, which is generally a three-year period from the date of the grant. For purposes of measuring compensation expense for performance-based RSUs, at each reporting date we estimate the number of shares for which vesting is deemed probable based on management’s expectations regarding achievement of the relevant performance criteria, adjusted by estimated forfeiture rates. Compensation expense for the number of shares ultimately expected to vest is recognized on a straight-line basis over the requisite service period for the performance-based RSUs. The recognition of compensation expense associated with performance-based RSUs requires judgment in assessing the probability of meeting the performance goals. For performance-based RSUs, there may be significant expense recognition or reversal of recognized expense in periods in which there are changes in the assessed probability of meeting performance-based vesting criteria. Income Taxes : Our provision for income taxes includes federal, state, local and foreign income taxes. We recognize tax credits, primarily for R&D, as a reduction of our provision for income taxes in the year in which they are generated. We provide deferred income taxes on temporary differences between assets and liabilities for financial reporting and tax purposes as measured by enacted tax rates we expect to apply when the temporary differences are settled or realized. We establish valuation allowances for deferred tax assets when the amount of future taxable income we expect is not likely to support the realization of the temporary differences. We evaluate the capital requirements of our foreign subsidiaries and determine the amount of excess capital, if any, that is available for distribution. We provide for U.S. taxes on the amount we determine to be excess capital available for distribution. U.S. taxes are not provided on amounts we consider to be permanently reinvested. Net Income Per Share : Basic net income per share (EPS) is computed by dividing the net income for the period by the weighted average number of common shares outstanding during the period, including vested RSUs. Diluted EPS is computed by dividing the net income for the period by the weighted average number of common and common equivalent shares outstanding during the period. Common equivalent shares consist of dilutive RSUs. Dilutive RSUs are calculated based on the average share price for each fiscal period using the treasury stock method. For RSUs with performance-based vesting, no common equivalent shares are included in the computation of diluted EPS until the related performance criteria have been met. Basic and diluted EPS are computed as follows (amounts in thousands, except per share data): Year Ended September 30, 2015 2014 2013 Net income attributable to Cubic $ $ $ Weighted average shares - basic Effect of dilutive securities Weighted average shares - diluted Net income per share attributable to Cubic, basic $ $ $ Effect of dilutive securities — — — Net income per share attributable to Cubic, diluted $ $ $ Anti-dilutive employee share-based awards — — — Recent Accounting Pronouncements: In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers . ASU 2014-09 outlines a comprehensive revenue recognition model and supersedes most current revenue recognition guidance and will require revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. ASU 2014-09 will be effective for us starting in the first quarter of fiscal 2019 or we may adopt ASU 2014-09 early, in the first quarter of 2018. ASU 2014-09 allows for two methods of adoption: (a) “full retrospective” adoption, meaning the standard is applied to all periods presented, or (b) “modified retrospective” adoption, meaning the cumulative effect of applying ASU 2014-09 is recognized as an adjustment to the opening retained earnings balance in the year of adoption. We have not yet determined which method of adoption we will select or if we will choose to adopt the standard early. As the new standard will supersede substantially all existing revenue guidance affecting us under GAAP, it could impact revenue and cost recognition on a significant number of contracts across our business segments, in addition to our business processes and our information technology systems. As a result, our evaluation of the effect of the new standard will likely extend over several future periods. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern , which requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and provide related footnote disclosures. The guidance is effective for annual and interim reporting periods beginning on or after December 15, 2016, with early adoption permitted. ASU 2014-15 will be effective for us beginning in the first quarter of fiscal 2016. Early adoption is permitted for financial statements that have not been previously issued. This adoption is not expected to have a significant impact on our financial

ACQUISITIONS

ACQUISITIONS	12 Months Ended
	Sep. 30, 2015
ACQUISITIONS
ACQUISITIONS	NOTE 2—ACQUISITIONS Other than the purchase of the remaining equity interest in TranSys described below, each of the following acquisitions has been treated as a business combination for accounting purposes. The results of operations of each acquired business has been included in our consolidated financial statements since the respective date of each acquisition. DTECH On December 16, 2014 we acquired all of the outstanding capital stock of DTECH LABs, Inc. (DTECH). DTECH, based in Sterling, VA, is a provider of modular networking and baseband communications equipment that adds networking capability to our secure communications business.This acquisition expands the portfolio of product offerings and the customer base of our CGD Systems segment. For the year ended September 30, 2015, the amounts of DTECH’s sales and net income after taxes included in our Consolidated Statement of Income were $45.8 million and $0.5 million, respectively. Included in DTECH’s operating results are $0.8 million of transaction and acquisition related costs before related income taxes during the year ended September 30, 2015, as well as general and administrative expenses totaling $3.6 million related to the change in the fair value of contingent consideration described below. The purchase agreement states that the cost of the acquisition is approximately $99.5 million, adjusted by the difference between the net working capital acquired and the targeted working capital amounts and adjusted for other acquisition related payments made upon closing, plus a contingent amount of up to $15.0 million based upon DTECH’s achievement of revenue and gross profit targets in the future. The acquisition date fair value of the consideration is estimated to be $99.4 million. The total acquisition date fair value of consideration includes the acquisition fair value of holdback consideration and contingent consideration described below. Approximately $4.7 million of cash consideration (Holdback Consideration) will be paid to the seller over time when certain events occur in the future. The fair value of the Holdback Consideration is estimated to approximate $4.3 million using a discounted cash flow model, based upon the expected timing of the payment of the Holdback Consideration. In addition to the Holdback Consideration, we will pay the seller up to $15.0 million of contingent cash consideration based upon DTECH’s achievement of revenue and gross profit targets. The purchase agreement specifies independent revenue and gross profit targets for the period from our acquisition of DTECH through September 30, 2015, and separately for each of fiscal 2016 and fiscal 2017. At the acquisition date, the total fair value of the contingent consideration was estimated at $3.9 million using a real options approach (see Note 3 for further discussion of fair value measurements). The contingent consideration liability will be re-measured to fair value at each reporting date until the contingencies are resolved and any changes in fair value are recognized in earnings. At September 30, 2015 the fair value of the contingent consideration was $7.5 million. The cumulative increase in the fair value of the contingent consideration between the acquisition date and September 30, 2015 that was recognized as expense in fiscal 2015 was $3.6 million. Through September 30, 2015 we have paid $91.3 million to the seller. At September 30, 2015 we have recorded a liability of $11.8 million as an estimate of the additional cash consideration that will be due to the seller in the future, including the Holdback Consideration and contingent consideration. The acquisition of DTECH is being paid for with a combination of funds from our existing cash resources and borrowings on our revolving credit facility. The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Non compete agreements Backlog Cash Accounts receivable Inventory Warranty obligation ) Tax liabilities ) Accounts payable and accrued expenses ) Other net assets acquired Net identifiable assets acquired Goodwill Net assets acquired $ The fair values of purchased intangibles were determined using the valuation methodology deemed to be the most appropriate for each type of asset being valued. The customer relationships and backlog valuation used the excess earnings approach and the non-compete agreements used the with-and-without approach. The intangible assets are being amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the assets, over a weighted average useful life of two years from the date of acquisition and is expected to be deductible for tax purposes. The goodwill resulting from the acquisition consists primarily of the synergies expected from combining the operations of DTECH with our existing CGD Systems business, including the synergies expected from combining the networking and secure communications technologies of DTECH, and complementary products that will enhance our overall product and service portfolio. The goodwill also consists of the value of the assembled workforce that became our employees following the close of the acquisition. The amount recorded as goodwill is allocated to our CGD Systems segment and is expected to be deductible for tax purposes. The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of DTECH for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter Intific On February 28, 2014 we acquired all of the outstanding capital stock of Intific Inc. (Intific). Intific is focused on software and game-based solutions in modeling and simulation, training and education, cyber warfare, and neuroscience. The acquisition of Intific expanded the portfolio of services and customer base of our CGD Systems segment. For the year ended September 30, 2015, the amounts of Intific’s sales and net loss after taxes included in our Consolidated Statement of Income were $14.7 million and $1.8 million, respectively. For the year ended September 30, 2014, the amounts of Intific’s sales and net loss after taxes included in our Consolidated Statement of Income were $5.3 million and $4.2 million, respectively. The acquisition date fair value of the consideration transferred was $12.4 million. We paid cash of $11.2 million to the sellers in fiscal 2014 and the remaining $1.2 million was paid in fiscal 2015. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Technology Backlog Other intangible assets Accounts receivable Deferred tax assets Accounts payable and accrued expenses ) Deferred tax liabilities ) Other net assets acquired Net identifiable assets acquired Goodwill Net assets acquired $ The fair values of purchased intangibles were determined using the valuation methodology deemed to be the most appropriate for each type of asset being valued. The customer relationships and backlog valuation used the excess earnings approach and the technology valuation used the replacement cost approach. The intangible assets are being amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the assets, over a weighted average useful life of two years from the date of acquisition and the amortization expense is not expected to be deductible for tax purposes. The net deferred tax assets and liabilities offset each other to a negligible amount. However, the deferred tax liabilities of $1.5 million were primarily recorded to reflect the tax impact of amortization related to identified intangible assets that is not expected to be deductible for tax purposes, net of acquisition consideration that is a tax deductible expense. The deferred tax assets of $1.5 million primarily related to the future tax deduction for the cancellation of unvested options. The goodwill resulting from the acquisition consists primarily of the synergies expected from combining the operations of Intific with our existing CGD Systems business and the acquired assembled workforce. The anticipated synergies include the ability to expand services offerings and cost reductions. The amount recorded as goodwill is allocated to our CGD Systems segment and is not expected to be deductible for tax purposes. The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of Intific for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter — ITMS On November 26, 2013 we acquired all of the outstanding capital stock of Intelligent Transport Management Solutions Limited (ITMS) from Serco Limited. ITMS is a provider of traffic management systems technology, traffic and road enforcement and maintenance of traffic signals, emergency equipment and other critical road and tunnel infrastructure. The acquisition of ITMS expands the portfolio of services and customer base of our Cubic Transportation Systems (CTS) segment. For the year ended September 30, 2015, the amounts of ITMS’ sales and net loss after taxes included in our Consolidated Statement of Income were $47.0 million and $3.0 million, respectively. For the year ended September 30, 2014, the amounts of ITMS’ sales and net loss after taxes included in our Consolidated Statement of Income were $43.7 million and $2.3 million, respectively. Included in ITMS’ operating results are $0.5 million of transaction costs incurred during the year ended September 30, 2014. The acquisition date fair value of the consideration transferred was $72.2 million. We paid the seller cash of $69.0 million in November 2013 and in May 2014, we paid the remaining cash of $3.2 million. The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Intellectual property Backlog Supplier relationships Agreements with seller Accounts receivable - billed Accounts receivable - unbilled Deferred tax liabilities, net ) Deferred revenue ) Accounts payable and accrued expenses ) Other net assets acquired Net identifiable assets acquired Goodwill Net assets acquired $ The fair values of purchased intangibles were determined using the valuation methodology deemed to be the most appropriate for each type of asset being valued. The customer relationships and backlog valuation used the excess earnings approach and the non-compete agreement and seller agreements valuations used the with-and-without approach. The supplier relationship and intellectual property valuations used the replacement cost approach. The intangible assets are being amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the assets, over a weighted average useful life of two years from the date of acquisition. Future amortization of purchased intangibles is not deductible for tax purposes. The goodwill resulting from the acquisition consists primarily of the synergies expected from combining the operations of ITMS with our existing CTS business and the acquired assembled workforce. The anticipated synergies include the ability to expand services offerings and cost reductions. The amount recorded as goodwill is allocated to our CTS segment and is not expected to be deductible for tax purposes. The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of ITMS for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter — NextBus On January 24, 2013, we acquired all of the outstanding capital stock of NextBus, Inc. (NextBus) from Webtech Wireless, Inc. NextBus provides products and services to transit agencies which provide real-time passenger information to transit passengers, expanding the portfolio of services and customer base of our CTS segment. For the year ended September 30, 2015 the amount of NextBus’ sales and net income after taxes included in our Consolidated Statement of Income were $12.1 million and $0.4 million, respectively. For the year ended September 30, 2014 the amount of NextBus’ sales and net loss after taxes included in our Consolidated Statement of Income were $10.1 million and $0.6 million, respectively. For the year ended September 30, 2013 the amount of NextBus’ sales and net loss after taxes included in our Consolidated Statement of Income were $7.8 million and $0.4 million, respectively. Included in the NextBus operating results are $0.2 million in transaction related costs incurred during the year ended September 30, 2013. We paid the seller cash of $20.2 million for NextBus from our existing cash resources. The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Accounts receivable, net Backlog Acquired technology Corporate trade names Accounts payable and accrued expenses ) Deferred tax liabilities, net ) Other net liabilities assumed ) Net identifiable assets acquired Goodwill Net assets acquired $ The fair values of purchased intangibles were determined using the valuation methodology deemed to be the most appropriate for each type of asset being valued. Each of the valuation methodologies used were various methods under the income approach. The customer relationships and backlog valuations used the excess earnings approach. The trade names and technology valuations used the relief from royalty approach. The net deferred tax liabilities were primarily recorded to reflect the tax impact of the identified intangible assets that will not generate tax deductible amortization expense. The goodwill resulting from the acquisition consists primarily of the synergies expected from combining the operations of NextBus and our CTS business and the acquired assembled workforce. The anticipated synergies include the ability to expand services offerings and cost reductions. The amount recorded as goodwill is allocated to our CTS segment and is not expected to be deductible for tax purposes. The intangible assets are being amortized using a combination of accelerated and straight-line methods based on the expected cash flows from the assets, over a weighted average useful life of 5 years from the date of acquisition. The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of NextBus for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter NEK On December 14, 2012, Cubic acquired from NEK Advanced Securities Group, Inc. (Seller) the customer contracts and operating assets of NEK Special Programs Group LLC (NEK), which consists of the Seller’s Special Operation Forces training business based in Fayetteville, North Carolina and Colorado Springs, Colorado. For the year ended September 30, 2015 the amount of NEK’s sales and net loss after taxes included in our Consolidated Statement of Income were $55.6 million and less than $0.1 million, respectively. For the year ended September 30, 2014 the amount of NEK’s sales and net loss after taxes included in our Consolidated Statement of Income were $45.0 million and $0.6 million, respectively. For the year ended September 30, 2013 the amount of NEK’s sales and net loss after taxes included in our Consolidated Statement of Income were $31.6 million and $0.5 million, respectively. NEK’s net loss after tax in 2013 excludes any allocation of the goodwill impairment described in Note 7 that is recognized at the reporting unit level. Included in our operating results are $0.6 million in transaction related costs incurred during the year ended September 30, 2013 related to the NEK acquisition. The acquisition-date fair value of consideration transferred is $52.6 million, which has been paid to the Seller in cash from our existing cash resources. Of the $52.6 million of cash consideration that was paid to the Seller, $2.4 million paid in fiscal 2014 and $7.8 million paid in fiscal 2013 were contingent upon certain events that occurred between the acquisition date and September 30, 2014, including the novation of certain of the Seller’s contracts to NEK. The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Corporate trade names Non-compete agreements Accounts receivable -billed Accounts receivable -unbilled Accounts payable ) Other net liabilities assumed ) Net identifiable assets acquired Goodwill Net assets acquired $ The fair values of purchased intangibles were determined using the valuation methodology deemed to be the most appropriate for each type of asset being valued. Each of the valuation methodologies used were various methods under the income approach. The trade names valuation used the relief from royalty approach. The customer relationships valuation used the excess earnings approach and the non-compete agreements valuation used the with and without approach. The intangible assets are being amortized using a combination of straight-line and accelerated methods based on the expected cash flows from the assets, over a weighted average useful life of four years from the date of acquisition. The goodwill resulting from the acquisition consists primarily of the synergies expected from combining the operations of NEK and our CGD Services business and the acquired assembled workforce. The anticipated synergies include the ability to expand services offerings and cost reductions. The amount recorded as goodwill is allocated to our CGD Services segment and is expected to be deductible for tax purposes. The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of NEK for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter TranSys Transaction Systems Limited (TranSys) is the joint venture company through which we won the PRESTIGE contract in London in 1998. Although in recent years the entity has been less active, we intend to use TranSys in our future endeavors. We owned 50 percent of TranSys through September 30, 2015, and we consolidated TranSys in our financial statements because it was a VIE and we were its primary beneficiary. On September 30, 2015 we purchased its remaining equity for $1.0 million. The difference between the purchase price and the carrying value of our noncontrolling interest in TranSys was recorded as a decrease in equity. Pro forma information The following unaudited pro forma information presents our consolidated results of operations as if DTECH, Intific, Nextbus and ITMS had been included in our consolidated results since October 1, 2013 (in millions): Years Ended September 30, 2015 2014 Net sales $ $ Net income attributable to Cubic The pro forma information includes adjustments to give effect to pro forma events that are directly attributable to the acquisitions and have a continuing impact on operations including the amortization of purchased intangibles and the elimination of interest expense for the repayment of debt. No adjustments were made for transaction expenses, other adjustments that do not reflect ongoing operations or for operating efficiencies or synergies. The pro forma financial information is not necessarily indicative of what the consolidated financial results of our operations would have been had the acquisitions been completed on October 1, 2013, and it does not purport to project our future operating results.

FAIR VALUE OF FINANCIAL INSTRUM

FAIR VALUE OF FINANCIAL INSTRUMENTS	12 Months Ended
	Sep. 30, 2015
FAIR VALUE OF FINANCIAL INSTRUMENTS
FAIR VALUE OF FINANCIAL INSTRUMENTS	NOTE 3—FAIR VALUE OF FINANCIAL INSTRUMENTS The valuation techniques required to determine fair value are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect internal market assumptions. The two types of inputs create the following fair value hierarchy: · Level 1 - Quoted prices for identical instruments in active markets. · Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. · Level 3 - Significant inputs to the valuation model are unobservable. The fair value of certain of our cash equivalents are based upon quoted prices for identical instruments in active markets. The fair value of our other cash equivalents and our available for sale marketable securities is based upon a discounted cash flow model and approximate cost. The marketable securities in the rabbi trust are carried at fair value, which is based upon quoted market prices for identical securities. Derivative financial instruments are measured at fair value, the material portions of which are based on active or inactive markets for identical or similar instruments or model-derived valuations whose inputs are observable. Where model-derived valuations are appropriate, we use the applicable credit spread as the discount rate. Credit risk related to derivative financial instruments is considered minimal and is managed by requiring high credit standards for counterparties and through periodic settlements of positions. The fair value of our contingent consideration liability to the seller of DTECH is revalued to its fair value each period and any increase or decrease is recorded into selling, general and administrative expense. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. The fair value of the contingent consideration was estimated using a real options approach. Each annual payment was modeled using a portfolio of long and short digital options written on the underlying earnings metric (revenue or gross profit). The strike price for each option is the respective earnings threshold as specified in the agreement, and the spot price is calibrated to the revenue and gross profit forecast by calculating the present value of the corresponding projected earnings metric using a risk-adjusted discount rate. The volatility for the underlying earnings metrics was estimated to be 22% based on analysis of comparable guideline public companies. The risk-free rate was selected based on the quoted yields for U.S. Treasury securities with terms matching the earn-out payment period. The inputs to this model are significant unobservable inputs and therefore represent Level 3 measurements within the fair value hierarchy. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and each subsequent period. Accordingly, changes in the assumptions described above can materially impact the amount of contingent consideration expense we record in any period. From December 16, 2014, the date of acquisition of DTECH, through September 30, 2015 the following table summarizes the change in fair value of our Level 3 contingent consideration liability (in thousands): Balance as of December 16, 2014 $ Total remeasurement recognized in earnings Balance as of September 30, 2015 $ The following table presents assets and liabilities measured and recorded at fair value on our balance sheets on a recurring basis (in thousands): September 30, 2015 September 30, 2014 Level 1 Level 2 Level 3 Total Level 1 Level 2 Total Assets Cash equivalents $ $ — $ — $ $ $ $ Marketable securities — — — Current derivative assets — — — Noncurrent derivative assets — — — Marketable securities in rabbi trust — — — — — Total assets measured at fair value — Liabilities Current derivative liabilities — — — Noncurrent derivative liabilities — — — Current contingent consideration to seller of DTECH — — — — — Noncurrent contingent consideration to seller of DTECH — — — — — Total liabilities measured at fair value $ — $ $ $ $ — $ $ In fiscal 2015, we determined that $10.2 million of cash equivalents and $25.6 million of marketable securities were erroneously classified as Level 1 measurements within the table presenting assets and liabilities recorded at fair value on a recurring basis as of September 30, 2014. We have determined the affected assets should have been classified as Level 2 measurements within the disclosure. Based upon a quantitative and qualitative assessment of this error we have determined that this error was not material to our Consolidated Financial Statements, and we have corrected the classification in the September 30, 2014 footnote disclosure in the accompanying Consolidated Financial Statements. We carry certain financial instruments, including accounts receivable, short-term borrowings, accounts payable and accrued liabilities at cost, which we believe approximates fair value because of the short-term maturity of these instruments. The fair value of long-term debt is calculated by discounting the value of the note based on market interest rates for similar debt instruments, which is a Level 2 technique. The following table presents the estimated fair value and carrying value of our long-term debt (in millions): September 30, 2015 2014 Fair value $ $ Carrying value Due to the impairment of goodwill for the CGD Services reporting unit at July 1, 2013, the goodwill for CGD Services was measured at its estimated fair value at July 1, 2013. We estimated the fair value of the goodwill primarily based on the discounted projected cash flows of the underlying CGD Services operations and based upon market multiples from publicly traded comparable companies, which are Level 3 fair value measurement techniques. See Note 7 for a further discussion of the 2013 goodwill impairment. We did not have any significant non-financial assets or liabilities measured at fair value on a non-recurring basis in 2015, 2014, or 2013 except for the CGD Services goodwill at July 1, 2013 and the fair value of assets and liabilities acquired in business acquisitions.

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE	12 Months Ended
	Sep. 30, 2015
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE	NOTE 4—ACCOUNTS RECEIVABLE The components of accounts receivable under long-term contracts are as follows (in thousands): September 30, 2015 2014 U.S. Government Contracts: Amounts billed $ $ Recoverable costs and accrued profits on progress completed—not billed Commercial Customers: Amounts billed Recoverable costs and accrued profits on progress completed—not billed Less unbilled amounts not currently due—commercial customers ) ) $ $ A portion of recoverable costs and accrued profits on progress completed is billable under progress or milestone payment provisions of the related contracts. The remainder of these amounts is billable upon delivery of products or furnishing of services, with an immaterial amount subject to retainage provisions of the contracts. It is anticipated that we will bill and collect substantially the entire unbilled portion of receivables identified as current assets under progress billing provisions of the contracts or upon completion of milestones and/or acceptance by the customers during fiscal 2016. The amount classified as not currently due is an estimate of the amount of long-term contract accounts receivable that will not be collected within one year from September 30, 2015 under transportation systems contracts in the U.S. and Australia.

INVENTORIES

INVENTORIES	12 Months Ended
	Sep. 30, 2015
INVENTORIES
INVENTORIES	NOTE 5—INVENTORIES Significant components of inventories are as follows (in thousands): September 30, 2015 2014 Finished products $ $ — Work in process and inventoried costs under long-term contracts Materials and purchased parts Customer advances ) ) $ $ At September 30, 2015, work in process and inventoried costs under long-term contracts includes approximately $1.9 million in costs incurred outside the scope of work or in advance of a contract award, compared to $2.3 million as of September 30, 2014. We believe it is probable that we will recover the costs inventoried at September 30, 2015, plus a profit margin, under contract change orders or awards within the next year. Costs we incur for certain U.S. federal government contracts include general and administrative costs as allowed by government cost accounting standards. The amounts remaining in inventory at September 30, 2015 and 2014 were $1.8 million and $2.4 million, respectively.

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT	12 Months Ended
	Sep. 30, 2015
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT	NOTE 6—PROPERTY, PLANT AND EQUIPMENT Significant components of property, plant and equipment are as follows (in thousands): September 30, 2015 2014 Land and land improvements $ $ Buildings and improvements Machinery and other equipment Software Leasehold improvements Construction and internal-use software development in progress — Accumulated depreciation and amortization ) ) $ $ As a part of our efforts to upgrade our current information systems, early in fiscal 2015 we purchased new enterprise resource planning (ERP) software began the process of designing and configuring this software and other software applications to manage our operations. Capitalized software development costs related to these systems totaled $16.0 million during fiscal 2015. Such costs are classified as construction and internal-use software development in process at September 30, 2015 as these systems have not yet been placed in service. In addition to software costs that were capitalized in fiscal 2015, we recognized expense related to the development of our ERP system of $11.5 million for costs that did not meet the requirements for capitalization. Amounts that were expensed in connection with the development of these systems are classified within selling, general and administrative expenses in the Consolidated Statements of Income. In 2014 we capitalized internal costs of $5.0 million related to the development of software that is used to design products for CGD Systems’ customers. This software was placed in service in late fiscal 2014. Amortization of this software totaled $1.0 million in 2015 and $0.4 million in 2014. Our provisions for depreciation of plant and equipment and amortization of leasehold improvements amounted to $10.1 million, $7.8 million and $8.7 million in 2015, 2014 and 2013, respectively. Generally, we use straight-line methods for depreciable real property over estimated useful lives ranging from 15 to 39 years or for leasehold improvements, the term of the underlying lease if shorter than the estimated useful lives. We use accelerated methods (declining balance and sum-of-the-years-digits) for machinery and equipment and software over estimated useful lives ranging from 5 to 10 years.

GOODWILL AND PURCHASED INTANGIB

GOODWILL AND PURCHASED INTANGIBLE ASSETS	12 Months Ended
	Sep. 30, 2015
GOODWILL AND PURCHASED INTANGIBLE ASSETS
GOODWILL AND PURCHASED INTANGIBLE ASSETS	NOTE 7—GOODWILL AND PURCHASED INTANGIBLE ASSETS The changes in the carrying amount of goodwill for the two years ended September 30, 2015 are as follows (in thousands): Transportation Systems Cubic Global Defense Systems Cubic Global Defense Services Total Balances at October 1, 2013 $ $ $ $ Acquisitions (see Note 2) — Foreign currency exchange rate changes ) — ) Balances at September 30, 2014 Acquisitions (see Note 2) — — Foreign currency exchange rate changes ) ) — ) Balances at September 30, 2015 $ $ $ $ We complete our annual goodwill impairment test each year as of July 1. The first step of the goodwill impairment test compares the fair value of our reporting units to their carrying values. We estimate the fair value of our reporting units primarily based on the discounted projected cash flows of the underlying operations and based upon market multiples from publicly traded comparable companies. For our 2015 impairment test, the estimated fair value of all three of our reporting units exceeded their respective carrying values. As such, there was no impairment of goodwill in 2015. The estimated fair values for our CGD Systems and Transportation Systems reporting units each exceeded their carrying values by over 20%, while the estimated value of our CGD Services reporting unit exceeded its carrying value by over 10%. Significant management judgment is required in the forecast of future operating results that are used in our impairment analysis. The estimates we used are consistent with the plans and estimates that we use to manage our business. For our CGD Services reporting unit, significant assumptions utilized in our discounted cash flow approach included growth rates for sales and margins at greater levels than we have achieved in the past five years, but at levels that are less than the average annual growth we achieved over the period from fiscal 2000 through fiscal 2010. Although we believe our underlying assumptions supporting this assessment are reasonable, if our forecasted sales and margin growth rates, timing of growth, or the discount rate vary from our forecasts, we may be required to perform an interim analysis in 2016 that could expose us to material impairment charges in the future. In performing the 2015 annual test for our CGD Services reporting unit, small changes in the discount rate, growth rate or gross margin assumptions could have a significant impact on the determination of the estimated fair value of CGD Services. For example a decrease in each future year’s projected cash flows by 12% would have resulted in us being required to complete step two of the analysis for the CGD Services reporting unit. We will be required to monitor changes in these factors as well as other factors which may be considered indicators of interim impairment of our goodwill prior to our next annual impairment test. In 2013, slowed defense spending and margin compression due to competitive pressures on bid rates impacted operating results and tempered the projected cash flows of our CGD Services reporting unit, negatively impacting our estimate of its fair value at July 1, 2013. Step one of the impairment test indicated that the carrying value of our CGD Services reporting unit, including goodwill, exceeded its estimated fair value at July 1, 2013. Accordingly, in 2013 we performed the second step of the goodwill impairment test to measure the amount of the impairment loss, if any. The second step of the test requires the allocation of the reporting unit’s fair value to its assets and liabilities, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill as if the reporting unit was being acquired in a business combination. Based on the results of the step two analysis, we recorded a $50.9 million goodwill impairment in 2013. Purchased Intangible Assets: The table below summarizes our purchased intangible assets (in thousands): September 30, 2015 September 30, 2014 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Contract and program intangibles $ $ ) $ $ ) $ Other purchased intangibles ) ) Total $ $ ) $ $ $ ) $ Total amortization expense for 2015, 2014 and 2013 was $27.6 million, $22.6 million and $16.7 million, respectively. The table below shows our expected amortization of purchased intangibles as of September 30, 2015, for each of the next five years and thereafter (in thousands): Transportation Systems Cubic Global Defense Systems Cubic Global Defense Services Total 2016 $ $ $ $ 2017 2018 2019 2020 Thereafter $ $ $ $

FINANCING ARRANGEMENTS

FINANCING ARRANGEMENTS	12 Months Ended
	Sep. 30, 2015
FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS	NOTE 8—FINANCING ARRANGEMENTS Long-term debt consists of the following (in thousands): September 30, 2015 2014 Series A senior unsecured notes payable to a group of insurance companies, interest fixed at 3.35% $ $ Series B senior unsecured notes payable to a group of insurance companies, interest fixed at 3.35% Series C senior unsecured notes payable to a group of insurance companies, interest fixed at 3.70% — Mortgage note from a U.K. financial institution, with quarterly installments of principal and interest at 6.48% Less current portion ) ) $ $ Maturities of long-term debt for each of the five years in the period ending September 30, 2020, are as follows: 2016 — $0.5 million; 2017 — $0.5 million; 2018 — $0.5 million; 2019 — $0.1 million; 2020 — none. Interest paid amounted to $4.8 million, $4.1 million and $3.7 million in 2015, 2014 and 2013, respectively. Interest paid in 2013 included an interest payment of $0.6 million incurred in connection with a legal settlement. In March 2013, we entered into a note purchase and private shelf agreement pursuant to which we issued $100.0 million of senior unsecured notes, bearing interest at a rate of 3.35% and maturing on March 12, 2025. Interest on these notes is due semi-annually and principal payments are due from 2021 through 2025. In addition, pursuant to the agreement, on July 17, 2015 we issued additional senior unsecured notes in an aggregate principal amount of $25.0 million. These additional notes will also mature on March 12, 2025 and will bear an interest rate of 3.70%. All other terms, including the principal and interest payment dates are the same as the notes issued in March 2013. We have a committed five-year revolving credit agreement (Revolving Credit Agreement) with a group of financial institutions in the amount of $200 million, which expires in May 2017. The available line of credit is reduced by any letters of credit issued under the Revolving Credit Agreement. As of September 30, 2015, there were borrowings totaling $60.0 million under this agreement and there were letters of credit outstanding totaling $21.8 million, which reduce the available line of credit to $118.2 million. Borrowings under the agreement bear a variable rate of interest which is calculated based upon the U.S. dollar LIBOR rate plus a contractually defined credit spread that is based upon the tenor of the specific borrowing. At September 30, 2015 the weighted average interest rate on outstanding borrowings under the Revolving Credit Agreement was 1.7%. We have a secured letter of credit facility agreement with a bank (Secured Letter of Credit Facility) which is cancellable by us at any time upon the completion of certain conditions to the satisfaction of the bank. At September 30, 2015 there were letters of credit outstanding under this agreement of $58.5 million. Restricted cash at September 30, 2015 of $69.2 million was held on deposit in the U.K. as collateral in support of this Secured Letter of Credit Facility. We are required to leave the cash in the restricted account so long as the bank continues to maintain associated letters of credit under the facility. The maximum amount of letters of credit currently allowed by the facility is $62.8 million, and any increase above this amount would require bank approval and additional restricted funds to be placed on deposit. We may choose at any time to terminate the facility and move the associated letters of credit to another credit facility. Letters of credit outstanding under the Secured Letter of Credit Facility do not reduce the available line of credit under the Revolving Credit Agreement. As of September 30, 2015, we had letters of credit and bank guarantees outstanding totaling $76.0 million, including the letters of credit outstanding under the Revolving Credit Agreement and the Secured Letter of Credit Facility, which guarantee either our performance or customer advances under certain contracts. In addition, we had financial letters of credit outstanding totaling $16.1 million as of September 30, 2015, which primarily guarantee our payment of certain self-insured liabilities. We have never had a drawing on a letter of credit instrument, nor are any anticipated; therefore, we estimate the fair value of these instruments to be zero. We maintain short-term borrowing arrangements in New Zealand and Australia totaling $0.5 million New Zealand dollars (equivalent to approximately $0.3 million) and $3.0 million Australian dollars (equivalent to approximately $2.1 million) to help meet the short- term working capital requirements of our subsidiaries in those countries. At September 30, 2015, no amounts were outstanding under these borrowing arrangements. The terms of certain of our lending and credit agreements include provisions that require and/or limit, among other financial ratios and measurements, the permitted levels of debt, coverage of cash interest expense, and under certain circumstances, payments of dividends or other distributions to shareholders. As of September 30, 2015 these agreements do not restrict such distributions to shareholders. Our self-insurance arrangements are limited to certain workers’ compensation plans, automobile liability and product liability claims. Under these arrangements, we self-insure only up to the amount of a specified deductible for each claim. Self-insurance liabilities included in other current liabilities on the balance sheet amounted to $8.8 million and $9.1 million as of September 30, 2015 and 2014, respectively.

COMMITMENTS

COMMITMENTS	12 Months Ended
	Sep. 30, 2015
COMMITMENTS
COMMITMENTS	NOTE 9—COMMITMENTS We lease certain office, manufacturing and warehouse space, vehicles, and other office equipment under non-cancelable operating leases expiring in various years through 2030 . These leases, some of which may be renewed for periods up to 10 years, generally require us to pay all maintenance, insurance and property taxes. Several leases are subject to periodic adjustment based on price indices or cost increases. Rental expense (net of sublease income of $0.3 million in 2015, $0.2 million in 2014 and $0.2 million in 2013) for all operating leases amounted to $11.9 million, $12.0 million and $12.6 million in 2015, 2014 and 2013, respectively. Future minimum payments, net of minimum sublease income, under non-cancelable operating leases with initial terms of one year or more consist of the following for the next five years and thereafter, as of September 30, 2015 (in thousands): 2016 $ 2017 2018 2019 2020 Thereafter $

INCOME TAXES

INCOME TAXES	12 Months Ended
	Sep. 30, 2015
INCOME TAXES
INCOME TAXES	NOTE 10—INCOME TAXES Income (loss) before income taxes includes the following components (in thousands): Years ended September 30, 2015 2014 2013 (in thousands) United States $ ) $ ) $ ) Foreign Total $ $ $ Significant components of the provision for income taxes are as follows: Years ended September 30, 2015 2014 2013 (in thousands) Current: Federal $ ) $ ) $ State Foreign Total current Deferred: Federal ) State ) ) Foreign Total deferred ) Provision for income taxes $ $ $ The reconciliation of income tax computed at the U.S. federal statutory tax rate to income tax expense is as follows: Years ended September 30, 2015 2014 2013 (in thousands) Tax expense at U.S. statutory rate $ $ $ State income taxes, net of federal tax effect ) Nondeductible expenses Change in reserve for tax contingencies ) ) ) Impact of goodwill impairment loss — — Change in deferred tax asset valuation allowance Foreign earnings taxed at less than statutory rate ) ) ) Tax credits generated in the current year ) ) ) Reinstatement of federal research and development credit ) — ) Manufacturing deduction — — ) Other ) Provision for income taxes $ $ $ Significant components of our deferred tax assets and liabilities are as follows: September 30, 2015 2014 (in thousands) Deferred tax assets: Accrued employee benefits $ $ Long-term contracts and inventory valuation reductions Allowances for loss contingencies Deferred compensation Property, plant and equipment Intangible assets Retirement benefits Tax credit carryforwards Net operating losses carryforwards Other Total gross deferred tax assets Valuation allowance ) ) Total deferred tax assets Deferred tax liabilities: Deferred revenue ) ) Other ) ) Total deferred tax liabilities ) ) Net deferred tax asset (liability) $ ) $ The deferred tax assets and liabilities for fiscal 2015 and 2014 include amounts related to various acquisitions. The total change in deferred tax assets and liabilities in fiscal 2015 includes changes that are recorded to Other Comprehensive Income (OCI). We calculate deferred tax assets and liabilities based on differences between financial reporting and tax bases of assets and liabilities, and measure them using the enacted tax rates and laws that we expect will be in effect when the differences reverse. As of September 30, 2015, we had net operating loss carryforwards of approximately $47.4 million for foreign and $33.3 million for state, and unused state tax credits of $15.8 million. In general, our foreign operating loss carryforwards and state tax credits are not subject to expiration. The state operating loss carryforwards will begin to expire in fiscal year 2026. Companies are required to assess whether a valuation allowance should be recorded against their deferred tax assets (“DTAs”) based on the consideration of all available evidence, using a “more likely than not” realization standard. The four sources of taxable income that must be considered in determining whether DTAs will be realized are, (1) future reversals of existing taxable temporary differences (i.e. offset of gross deferred tax assets against gross deferred tax liabilities); (2) taxable income in prior carryback years, if carryback is permitted under the tax law; (3) tax planning strategies and (4) future taxable income exclusive of reversing temporary differences and carryforwards. In assessing whether a valuation allowance is required, significant weight is to be given to evidence that can be objectively verified. We have evaluated our U.S. DTAs, including an assessment of our cumulative income or loss over the prior three-year period and future periods, to determine if a valuation allowance was required. A significant negative factor in our assessment was Cubic’s three-year cumulative U.S. GAAP loss as of the end of fiscal year 2015. After a review of the four sources of taxable income described above and in view of our three-year cumulative U.S. loss, we recorded an increase in our valuation allowance on U.S. DTAs, with a corresponding charge to our net income tax expense, of $35.8 million. An additional $1.8 million valuation allowance was recorded against our foreign deferred tax assets for a total charge of $37.6 million. Through September 30, 2015, a total valuation allowance of $54.8 million has been established for U.S. net deferred tax assets, certain foreign operating losses and other foreign assets. If sufficient positive evidence arises in the future, such as a sustained return to profitability in the U.S. or foreign jurisdictions, any existing valuation allowance could be reversed as appropriate, decreasing income tax expense in the period that such conclusion is reached. The non-cash charge to establish a valuation allowance does not have any impact on our consolidated operations or cash flows, nor does such an allowance preclude our from using loss carryforwards or other deferred tax assets in the future. Until we re-establish a pattern of continuing profitability, in accordance with the applicable accounting guidance, U.S. income tax expense or benefit related to the recognition of deferred tax assets in the Consolidated Statement of Income for future periods will be offset by decreases or increases in the valuation allowance with no net effect on the Consolidated Statement of Income. We do not provide for U.S. income taxes on the earnings of foreign subsidiaries which are considered indefinitely reinvested outside the U.S. Deferred income taxes, net of foreign tax credits, are provided for foreign earnings available for repatriation. As of September 30, 2015, the cumulative amount of earnings upon which U.S. income taxes have not been provided is approximately $426.6 million of which $394.9 million originates from the U.K. We continually evaluate the financial requirements of our U.S. operations as well as funding requirements outside the U.S. for potential acquisitions, market growth and ongoing operations to determine the amount of excess capital, if any, that is available for distribution . Upon distribution of those earnings in the form of dividends or otherwise, we would be subject to both U.S. income taxes and foreign withholding taxes, but would also be able to offset unrecognized foreign tax credit carryforwards, if any. It is not practicable for us to determine the total amount of unrecognized deferred U.S. income tax liability because of the complexities associated with its hypothetical calculation. Accounting for Uncertainty in Income Taxes During fiscal 2015 and 2014, the aggregate changes in our total gross amount of unrecognized tax benefits are summarized as follows: Years ended September 30, 2015 2014 (in thousands) Balance at beginning of year $ $ Increase (decrease) related to tax positions in prior years: Recognition of benefits from expiration of statutes ) ) Settlements with taxing authorities — ) Other ) Tax positions related to the current year Tax positions related to current year acquisitions — Currency translation adjustment — ) Balance at end of year $ $ At September 30, 2015 and 2014, the amount of unrecognized tax benefits from permanent tax adjustments that, if recognized, would affect the effective tax rate was $4.5 million and $4.7 million, respectively. During the next 12 months, it is reasonably possible that resolution of reviews by taxing authorities, both domestic and foreign, could be reached with respect to approximately $3.7 million of the unrecognized tax benefits depending on the timing of examinations or expiration of statute of limitations, either because our tax positions are sustained or because we agree to the disallowance and pays the related income tax. The amount of net interest and penalties recognized as a component of income tax expense during 2015, 2014 and 2013 was not material. Interest and penalties accrued at September 30, 2015 and 2014 amounted to $1.2 million and $1.6 million, respectively, bringing the total net liability for uncertain tax issues to $10.9 million and $8.0 million, respectively, as of September 30, 2015 and 2014. We are subject to ongoing audits from various taxing authorities in the jurisdictions in which we do business. As of September 30, 2015, the fiscal years open under the statute of limitations in significant jurisdictions include 2012 through 2015 in the U.S. We believe we have adequately provided for uncertain tax issues we have not yet resolved with federal, state and foreign tax authorities. Although not more likely than not, the most adverse resolution of these issues could result in additional charges to earnings in future periods. Based upon a consideration of all relevant facts and circumstances, we do not believe the ultimate resolution of uncertain tax issues for all open tax periods will have a material adverse effect upon our financial condition or results of operations. Cash amounts paid for income taxes, net of refunds received, were $15.2 million, $27.3 million and $42.1 million in 2015, 2014 and 2013, respectively.

DERIVATIVE INSTRUMENTS AND HEDG

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES	12 Months Ended
	Sep. 30, 2015
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES	NOTE 11—DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES In order to manage our exposure to fluctuations in interest and foreign currency exchange rates we utilize derivative financial instruments such as foreign currency forwards. We do not use any derivative financial instruments for trading or other speculative purposes. All derivatives are recorded at fair value, however, the classification of gains and losses resulting from changes in the fair values of derivatives are dependent on the intended use of the derivative and its resulting designation. If a derivative is designated as a fair value hedge, then a change in the fair value of the derivative is offset against the change in the fair value of the underlying hedged item and only the ineffective portion of the hedge, if any, is recognized in earnings. If a derivative is designated as a cash flow hedge, then the effective portion of a change in the fair value of the derivative is recognized as a component of accumulated other comprehensive income until the underlying hedged item is recognized in earnings, or the forecasted transaction is no longer probable of occurring. If a derivative does not qualify as a highly effective hedge, any change in fair value is immediately recognized in earnings. We formally document all hedging relationships for all derivative hedges and the underlying hedged items, as well as the risk management objectives and strategies for undertaking the hedge transactions. We classify the fair value of all derivative contracts as current or non- current assets or liabilities, depending on the realized and unrealized gain or loss position of the hedged contract at the balance sheet date, and the timing of future cash flows. The cash flows from derivatives treated as hedges are classified in the Consolidated Statements of Cash Flows in the same category as the item being hedged. The following table shows the notional principal amounts of our outstanding derivative instruments as of September 30, 2015 and 2014 (in thousands): Notional Principal September 30, 2015 2014 Instruments designated as accounting hedges: Foreign currency forwards $ $ Instruments not designated as accounting hedges: Foreign currency forwards $ $ Included in the amounts not designated as accounting hedges above at September 30, 2015 and 2014 are foreign currency forwards with notional principal amounts of $117.8 million and $132.1 million, respectively, that have been designed to manage exposure to foreign currency exchange risks, and for which the gains or losses of the changes in fair value of the forwards has approximately offset an equal and opposite amount of gains or losses related to the foreign currency exposure. The notional principal amounts for outstanding derivative instruments provide one measure of the transaction volume outstanding and do not represent the amount of our exposure to credit or market loss. Credit risk represents our gross exposure to potential accounting loss on derivative instruments that are outstanding or unsettled if all counterparties failed to perform according to the terms of the contract, based on then-current interest or currency exchange rates at each respective date. The Company’s exposure to credit loss and market risk will vary over time as a function of interest and currency exchange rates. The amount of credit risk from derivative instruments and hedging activities was not material for the fiscal years ended September 30, 2015 and 2014. Although the table above reflects the notional principal amounts of our foreign exchange instruments, it does not reflect the gains or losses associated with the exposures and transactions that the foreign exchange instruments are intended to hedge. The amounts ultimately realized upon settlement of these financial instruments, together with the gains and losses on the underlying exposures, will depend on actual market conditions during the remaining life of the instruments. We generally enter into master netting arrangements, which reduce credit risk by permitting net settlement of transactions with the same counterparty. We presents its derivative assets and derivative liabilities at their gross fair values. We did not have any derivative instruments with credit-risk related contingent features that would require us to post collateral as of September 30, 2015 or 2014. The table below presents the fair value of our derivative financial instruments that qualify for hedge accounting as well as their classification on the consolidated balance sheets as of September 30, 2015 and 2014 (in thousands): Fair Value September 30, Balance Sheet Location 2015 2014 Asset derivatives: Foreign currency forwards Other current assets $ $ Foreign currency forwards Other noncurrent assets $ $ Liability derivatives: Foreign currency forwards Other current liabilities $ $ Foreign currency forwards Other noncurrent liabilities Total $ $ The tables below present gains and losses recognized in OCI for the years ended September 30, 2015 and 2014 related to derivative financial instruments designated as cash flow hedges, as well as the amount of gains and losses reclassified into earnings during those periods (in thousands): Years ended September 30, 2015 2014 2015 2014 Derivative Type Gains (losses) recognized in OCI Gains (losses) reclassified into earnings - Effective Portion Gains (losses) recognized in OCI Gains (losses) reclassified into earnings - Effective Portion Location of gain (loss) Gains (losses) recognized - Ineffective Portion and amount excluded from effectiveness testing Foreign currency forwards $ $ $ $ Other income/(expense), net $ $ — Forward starting swap — — — — Other income/(expense), net — $ $ $ $ $ $ The amount of gains and losses from derivative instruments and hedging activities classified as not highly effective did not have a material impact on the results of operations for the years ended September 30, 2015 or 2014. The amount of estimated unrealized net gains from cash flow hedges which are expected to be reclassified to earnings in the next twelve months is $1.3 million, net of income taxes. Foreign currency forwards In order to limit our exposure to foreign currency exchange rate risk we generally hedge those commitments greater than $50,000 by using foreign currency exchange forward and option contracts that are denominated in currencies other than the functional currency of the subsidiary responsible for the commitment, typically the British pound, Canadian dollar, Singapore dollar, euro, Swedish krona, New Zealand dollar and Australian dollar. These contracts are designed to be effective hedges regardless of the direction or magnitude of any foreign currency exchange rate change, because they result in an equal and opposite income or cost stream that offsets the change in the value of the underlying commitment.

PENSION, PROFIT SHARING AND OTH

PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS	12 Months Ended
	Sep. 30, 2015
PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS
PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS	NOTE 12—PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS Deferred Compensation Plans We have a non-qualified deferred compensation plan offered to a select group of highly compensated employees. The plan provides participants with the opportunity to defer a portion of their compensation in a given plan year. The liabilities associated with the non-qualified deferred compensation plan totaled $9.9 million and $9.5 million at September 30, 2015 and 2014, respectively. In the first quarter of fiscal 2015, we began making contributions to a rabbi trust to provide a source of funds for satisfying a portion of these deferred compensation liabilities. The total carrying value of the assets set aside to fund deferred compensation liabilities as of September 30, 2015 was $2.9 million, which included life insurance contracts with a carrying value of $1.9 million and marketable securities with a carrying value of $1.0 million. The carrying value of the life insurance contracts is based on the cash surrender value of the policies. The marketable securities in the rabbi trust are carried at fair value, which is based upon quoted market prices for identical securities. Changes in the carrying value of the deferred compensation liability, and changes in the carrying value of the assets held in the rabbi trust are reflected in our Consolidated Statements of Income. Defined Contribution Plans We have profit sharing and other defined contribution retirement plans that provide benefits for most U.S. employees. Certain of these plans require the company to match a portion of eligible employee contributions up to specified limits. These plans also allow for additional company contributions at the discretion of the Board of Directors. In 2015, 2014 and 2013, more than half of our contributions to these plans were discretionary contributions. We also have a defined contribution plan for European employees that were formerly eligible for the European defined benefit plan described below. Under this plan, the company matches a portion of the eligible employee contributions up to limits specified in the plan. Company contributions to defined contribution plans aggregated $14.2 million, $19.6 million and $19.7 million in 2015, 2014 and 2013, respectively. Defined Benefit Pension Plans Certain employees in the U.S. are covered by a noncontributory defined benefit pension plan for which benefits were frozen as of December 31, 2006 (curtailment). The effect of the U.S. plan curtailment is that no new benefits have been accrued after that date. Approximately one-half of our European employees are covered by a contributory defined benefit pension plan for which benefits were frozen as of September 30, 2010. Although the effect of the European plan curtailment is that no new benefits will accrue after September 30, 2010, the plan is a final pay plan, which means that benefits will be adjusted for increases in the salaries of participants until their retirement or departure from the company. The European plan was amended in 2014 to reduce the amount of participant compensation used in computing the pension liability for certain participants. We recognized a decrease in our benefit obligation as a result of these plan amendments of $1.7 million in 2014. U.S. and European employees hired subsequent to the dates of the curtailment of the respective plans are not eligible for participation in the defined benefit plans. Our funding policy for the defined benefit pension plans provides that contributions will be at least equal to the minimum amounts mandated by statutory requirements. Based on our known requirements for the U.S. and U.K. plans, as of September 30, 2015, we expect to make contributions of approximately $5.1 million in 2016. September 30 is used as the measurement date for these plans. The unrecognized amounts recorded in accumulated other comprehensive income (loss) will be subsequently recognized as net periodic pension cost, consistent with our historical accounting policy for amortizing those amounts. We will recognize actuarial gains and losses that arise in future periods and are not recognized as net periodic pension cost in those periods as increases or decreases in other comprehensive income (loss), net of tax, in the period they arise. We adjust actuarial gains and losses recognized in other comprehensive income (loss) as they are subsequently recognized as a component of net periodic pension cost. The unrecognized actuarial gain or loss included in accumulated other comprehensive income (loss) at September 30, 2015 and expected to be recognized in net pension cost during fiscal 2016 is a loss of $2.0 million ($1.5 million net of income tax). No plan assets are expected to be returned to us in 2016. The projected benefit obligation, accumulated benefit obligation (ABO) and fair value of plan assets for the defined benefit pension plans were as follows (in thousands): September 30, 2015 2014 Projected benefit obligation $ $ Accumulated benefit obligation Fair value of plan assets The following table sets forth changes in the projected benefit obligation and fair value of plan assets and the funded status for these defined benefit plans (in thousands): September 30, 2015 2014 Change in benefit obligations: Net benefit obligation at the beginning of the year $ $ Service cost Interest cost Actuarial loss (gain) Plan amendments — ) Gross benefits paid ) ) Foreign currency exchange rate changes ) Net benefit obligation at the end of the year Change in plan assets: Fair value of plan assets at the beginning of the year Actual return on plan assets Employer contributions Gross benefits paid ) ) Administrative expenses ) ) Foreign currency exchange rate changes ) Fair value of plan assets at the end of the year Unfunded status of the plans ) ) Unrecognized net actuarial loss Net amount recognized $ $ Amounts recognized in Accumulated OCI Liability adjustment to OCI $ ) $ ) Deferred tax asset Valuation allowance on deferred tax asset ) — Accumulated other comprehensive loss $ ) $ ) The components of net periodic pension cost (benefit) were as follows (in thousands): Years ended September 30, 2015 2014 2013 Service cost $ $ $ Interest cost Expected return on plan assets ) ) ) Amortization of actuarial loss Administrative expenses Net pension benefit $ ) $ ) $ ) Years ended September 30, 2015 2014 2013 Weighted-average assumptions used to determine benefit obligation at September 30: Discount rate % % % Rate of compensation increase % % % Weighted-average assumptions used to determine net periodic benefit cost for the years ended September 30: Discount rate % % % Expected return on plan assets % % % Rate of compensation increase % % % The long-term rate of return assumption represents the expected average rate of earnings on the funds invested or to be invested to provide for the benefits included in the benefit obligations. That assumption is determined based on a number of factors, including historical market index returns, the anticipated long-term asset allocation of the plans, historical plan return data, plan expenses, and the potential to outperform market index returns. We have the responsibility to formulate the investment policies and strategies for the plans’ assets. Our overall policies and strategies include: maintain the highest possible return commensurate with the level of assumed risk, and preserve benefit security for the plans’ participants. We do not direct the day-to-day operations and selection process of individual securities and investments and, accordingly, we have retained the professional services of investment management organizations to fulfill those tasks. The investment management organizations have investment discretion over the assets placed under their management. We provide each investment manager with specific investment guidelines by asset class. The target ranges for each major category of the plans’ assets at September 30, 2015 are as follows: Asset Category Allocation Range Equity securities 20% to 55% Debt securities 25% to 75% Cash 0% to 55% Real estate 0% to 10% Our defined benefit pension plans invest in cash and cash equivalents, equity securities, fixed income securities, pooled separate accounts and common collective trusts. The following tables present the fair value of the assets of our defined benefit pension plans by asset category and their level within the fair value hierarchy (in thousands). See Note 3 for a description of each level within the fair value hierarchy. During 2015 our plans invested in a diversified growth fund that holds underlying investments in equities, fixed- income securities, commodities, and real estate. All assets classified as Level 2 or Level 3 in the table below are invested in pooled separate accounts or common collective trusts which do not have publicly quoted prices. The fair value of the pooled separate accounts and common collective trusts are determined based on the net asset value of the underlying investments. The fair value of the underlying investments held by the pooled separate accounts and common collective trusts, other than real estate investments, is generally based upon quoted prices in active markets. The fair value of the underlying investments comprised of real estate properties is determined through an appraisal process which uses valuation methodologies including comparisons to similar real estate and discounting of income streams. For investments in the pooled separate accounts and common collective trusts categorized as Level 2 below, there are no restrictions on the ability of our benefit plans to sell these investments. September 30, 2015 September 30, 2014 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents $ $ $ — $ $ $ $ — $ Equity: U.S. equity securities — — — — Foreign equity securities — — — — Fixed Income: U.S. fixed-income funds — — — — U.K. fixed-income funds — — — — Diversified growth fund — — Real Estate — — — — Total $ $ $ $ $ $ $ $ The following table presents the changes in the fair value of plan assets categorized as Level 3 in the preceding table (in thousands): Real Estate Balance as of October 1, 2013 $ Realized and unrealized gains, net Purchases, sales and settlements, net ) Balance as of September 30, 2014 Realized and unrealized gains, net Purchases, sales and settlements, net ) Balance as of September 30, 2015 $ The pension plans held no direct positions in Cubic Corporation common stock as of September 30, 2015 and 2014. We expect to pay the following pension benefit payments, which reflect expected future service, as appropriate, (in thousands): 2016 $ 2017 2018 2019 2020 2021-2025

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	12 Months Ended
	Sep. 30, 2015
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY	NOTE 13—STOCKHOLDERS’ EQUITY Long-Term Equity Incentive Plan On March 21, 2013, the Executive Compensation Committee of the Board of Directors (Compensation Committee) approved a long- term equity incentive award program. Through September 30, 2015, the Compensation Committee has granted 565,409 RSUs with time-based vesting and 488,604 RSUs with performance-based vesting under this program. Each RSU represents a contingent right to receive one share of our common stock. Dividend equivalent rights accrue with respect to the RSUs when and as dividends are paid on our common stock and vest proportionately with the RSUs to which they relate. Vested shares are delivered to the recipient following each vesting date. The RSUs granted with time-based vesting generally vest in four equal installments on each of the four October 1 dates following the grant date, subject to the recipient’s continued service through such vesting date. The performance-based RSUs granted to participants vest over three-year performance periods based on Cubic’s achievement of performance goals established by the Compensation Committee over the performance periods, subject to the recipient’s continued service through the end of the respective performance periods. For the performance-based RSUs granted to date, the vesting will be contingent upon Cubic meeting one of three types of vesting criteria over the performance period. These three categories of vesting criteria consist of revenue growth targets, earnings growth targets, and return on equity targets. The level at which Cubic’s performs against scalable targets over the performance periods will determine the percentage of the RSUs that will ultimately vest. Through September 30, 2015, Cubic has granted 1,054,013 RSUs of which 230,110 have vested. The grant date fair value of each RSU is the fair market value of one share of our common stock at the grant date. At September 30, 2015, the total number of unvested RSUs that are ultimately expected to vest, after consideration of expected forfeitures and estimated vesting of performance-based RSUs is 287,568. The following table summarizes our RSU activity: Unvested Restricted Stock Units Number of Shares Weighted-Average Grant-Date Fair Value Unvested at October 1, 2013 $ Granted Vested ) Forfeited ) Unvested at September 30, 2014 $ Granted Vested ) Forfeited ) Unvested at September 30, 2015 $ As of Septe mber 30, 2015, approximately 3,558,058 shares remained available for future grants under our long-term equity incentive plan. On October 1, 2015, 116,178 RSUs vested.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	12 Months Ended
	Sep. 30, 2015
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION	NOTE 14 — STOCK-BASED COMPENSATION We recorded non-cash compensation expense related to stock-based awards of $8.3 million for the year ended September 30, 2015, which was comprised of the following (in thousands): Cost of sales $ Selling, general and administrative $ As of September 30, 2015, there was $25.4 million of unrecognized compensation cost related to unvested RSUs. Based upon the expected forfeitures and the expected vesting of performance-based RSUs, the aggregate fair value of RSUs expected to ultimately vest is $13.8 million. This amount is expected to be recognized over a weighted-average period of 1.7 years. We are required to estimate forfeitures at the time of grant and revise those estimates in subsequent periods on a cumulative basis in the period the estimated forfeiture rate changes for all stock-based awards when significant events occur. We consider our historical experience with employee turnover as the basis to arrive at our estimated forfeiture rate. The forfeiture rate was estimated to be 12.5% per year as of September 30, 2015. To the extent the actual forfeiture rate is different from what we have estimated, stock-based compensation related to these awards will be different from our expectations.

LEGAL MATTERS

LEGAL MATTERS	12 Months Ended
	Sep. 30, 2015
LEGAL MATTERS
LEGAL MATTERS	NOTE 15—LEGAL MATTERS In October and December of 2013, and January of 2014, lawsuits were filed in the United States District Court for the Northern District of Illinois, Eastern Division against us and one of our transit customers alleging variously, among other things, breach of contract, violation of the Illinois Consumer Fraud Act, unjust enrichment and violation of the Electronic Funds Act. In January 2014, these cases were consolidated into a single case and the plaintiffs are seeking to have the case certified as a class action. Plaintiffs variously claim, among other things, that: (i) they were wrongly charged for calling the call center that we operate for patrons of our transit customer, (ii) they were wrongly charged for a transfer and a second fare, (iii) they were not credited the cost of a transit card even after registration of the card, as is required under the terms of the cardholder agreement, and (iv) they were double charged for rides taken. We are undertaking the defense of the transit customer pursuant to our contractual obligations to that customer. We are investigating the matter and are vigorously defending this lawsuit. We cannot, at this time, estimate the probability of loss or any range of estimate of possible loss. In October 2014, a lawsuit was filed in the United States District Court, Northern District of Illinois against us and our same transit customer alleging infringement of various patents held by the plaintiff. We are investigating the matter and plan to vigorously defend the lawsuit. We are also undertaking defense of our customer in this matter pursuant to our contractual obligations to that customer. Due to the preliminary nature of this case, we cannot estimate the probability of loss or any range of estimate of possible loss. In January 2015, we received $3.6 million as a settlement of a claim for the reimbursement of expenses we incurred primarily in 2014 for a proposal prepared for a prospective customer of our transportation systems business. This $3.6 million settlement has been recorded as a reduction of research and development and general and administrative expenses in fiscal 2015. In addition, in fiscal 2015 we also recognized a gain of $1.1 million for net insurance proceeds received related to losses on a customer claim incurred in fiscal 2012. The $1.1 million gain was recognized as a reduction of general and administrative expenses. We are not a party to any other material pending proceedings and we consider all other matters to be ordinary proceedings incidental to the business. We believe the outcome of these other proceedings will not have a materially adverse effect on our financial position, results of operations, or cash flows.

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION	12 Months Ended
	Sep. 30, 2015
BUSINESS SEGMENT INFORMATION
BUSINESS SEGMENT INFORMATION	NOTE 16—BUSINESS SEGMENT INFORMATION We have three primary business segments: Cubic Transportation Systems (CTS), Cubic Global Defense Services (CGD Services) and Cubic Global Defense Systems (CGD Systems). CTS designs, produces, installs and services electronic revenue collection systems for mass transit projects, including railways and buses. CGD Services provides training, operations, intelligence, maintenance, technical and other services to the U.S. government and allied nations. CGD Systems performs work under U.S. and foreign government contracts relating to electronic defense systems and equipment. CGD Systems products include customized military range instrumentation, laser based training systems, virtual simulation systems, communications products including datalinks, power amplifiers, avionics systems, modular networking and baseband communications equipment and cross domain hardware solutions to address multi-level security requirements. We evaluate performance and allocate resources based on total segment operating profit or loss. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Intersegment sales and transfers are immaterial and are eliminated in consolidation. Our reportable segments are business units that offer different products and services. Operating results for each segment are reported separately to senior corporate management to make decisions as to the allocation of corporate resources and to assess performance. Business segment financial data is as follows (in millions): Years ended September 30, 2015 2014 2013 Sales: Cubic Transportation Systems $ $ $ Cubic Global Defense Services Cubic Global Defense Systems Other — — Total sales $ $ $ Operating income (loss): Cubic Transportation Systems $ $ $ Cubic Global Defense Services ) Cubic Global Defense Systems Unallocated corporate expenses and other ) ) ) Total operating income $ $ $ Assets: Cubic Transportation Systems $ $ $ Cubic Global Defense Services Cubic Global Defense Systems Corporate and other Total assets $ $ $ Depreciation and amortization: Cubic Transportation Systems $ $ $ Cubic Global Defense Services Cubic Global Defense Systems Corporate and other Total depreciation and amortization $ $ $ Capital expenditures: Cubic Transportation Systems $ $ $ Cubic Global Defense Services — — Cubic Global Defense Systems Corporate and other Total expenditures for long-lived assets $ $ $ Years ended September 30, 2015 2014 2013 Geographic Information: Sales (a): United States $ $ $ United Kingdom Canada Australia Middle East Far East Other Total sales $ $ $ (a) Sales are attributed to countries or regions based on the location of customers. Long-lived assets, net: United States $ $ $ United Kingdom Other foreign countries Total long-lived assets, net $ $ $ CGD Services and CGD Systems segment sales include $670.0 million, $651.5 million and $691.8 million in 2015, 2014 and 2013, respectively, of sales to U.S. government agencies. CTS segment sales include $183.2 million, $213.2 million and $193.4 million in 2015, 2014 and 2013, respectively, of sales under various contracts with our customer, Transport for London (TfL). No other customer accounts for 10% or more of our revenues for any periods presented. Changes in estimates on contracts for which revenue is recognized using the cost-to-cost percentage-of-completion method decreased operating income by approximately $14.5 million in 2015, increased operating income by approximately $1.3 million in 2014 and decreased operating income by approximately $1.7 million in 2013. These adjustments decreased net income by approximately $8.0 million ($0.30 per share) in 2015, increased net income by approximately $3.5 million ($0.13 per share) in 2014 and decreased net income by approximately $0.3 million ($0.01 per share) in 2013. Certain of our transportation systems service contracts contain service level or system usage incentives, for which we recognize revenues when the incentive award is fixed or determinable. These contract incentives are generally based upon monthly service levels or monthly performance and become fixed or determinable on a monthly basis. However, one of our transportation systems service contracts contains annual system usage incentives which are based upon system usage compared to annual baseline amounts. For this contract the annual system usage incentives are not considered fixed or determinable until the end of the contract year for which the incentives are measured, which falls within the second quarter of our fiscal year. During the second quarter of fiscal years ended September 30, 2015, 2014, and 2013, we recognized sales of $9.3 million, $12.2 million, and $13.2 million, respectively related to annual system usage incentives on this transportation systems contract. In August 2015 we completed this contract and recognized an additional $3.1 million related to the final amount of system usage incentives. The recognition of these system usage incentives resulted in additional operating income of the same amounts in these respective periods. Upon completion of this contract we entered into a new service contract with this customer that is structured differently than the contract that completed in August 2015; the new contract does not have any significant system usage incentives. In 2015 we incurred a total of $6.3 million of charges related to restructuring. In February 2015, we implemented a plan to restructure our defense services and defense systems businesses into a single organization to better align our defense business organizational structure with customer requirements, increase operational efficiencies and improve collaboration and innovation across the company. CGD Systems and CGD Services incurred restructuring charges of $4.6 million and $0.6 million, respectively, in connection with these restructuring activities. In addition, CTS incurred $0.6 million of restructuring costs and we incurred $0.5 million of unallocated corporate expenses related to various restructuring activities. In 2014 we incurred restructuring charges of $1.1 million primarily by our CTS business in September 2014 as a result of a planned reduction of employee headcount in the U.S. by approximately 20. This restructuring was predominantly driven by the reduction in work on certain contracts that were in the process of moving from the design and build phase to the services phase. In 2013, we incurred restructuring charges of $8.1 million by our CGD Systems segment to reduce global employee headcount by approximately 230 in order to rebalance our resources with work levels that declined due to delays in contract awards and contract funding. A summary of the activity relating to the restructuring liability and employee separation expenses, which is included within accrued compensation and other current liabilities within our Consolidated Balance Sheet, is as follows (in thousands): Liability as of October 1, 2013 $ Accrued costs Cash payments ) Liability as of September 30, 2014 $ Accrued costs Cash payments ) Liability as of September 30, 2015 $

SUMMARY OF QUARTERLY RESULTS OF

SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)	12 Months Ended
	Sep. 30, 2015
SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)	NOTE 17—SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The following is a summary of our quarterly results of operations for the fiscal years ended September 30, 2015 and 2014: Year Three Months Ended Ended Fiscal 2015 September 30 June 30 March 31 December 31 September 30 (in thousands, except per share data) Net sales $ $ $ $ $ Operating income Net income (loss) attributable to Cubic ) Net income (loss) per share, basic ) Net income (loss) per share, diluted ) Year Three Months Ended Ended Fiscal 2014 September 30 June 30 March 31 December 31 September 30 (in thousands, except per share data) Net sales $ $ $ $ $ Operating income (loss) Net income (loss) attributable to Cubic Net income (loss) per share, basic Net income (loss) per share, diluted Changes in estimates on contracts for which revenue is recognized using the cost-to-cost-percentage-of-completion method increased operating profit by approximately $0.7 million in the three months ended September 30, 2015 and increased operating profit by approximately $10.7 million in the three months ended September 30, 2014. These adjustments increased net income by approximately $0.5 million ($0.02 per share) in the three months ended September 30, 2015 and increased net income by approximately $7.6 million ($0.28 per share) in the three months ended and September 30, 2014.

SUMMARY OF SIGNIFICANT ACCOUN26

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Sep. 30, 2015
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Nature of the Business	Organization and Nature of the Business : We design, develop and manufacture products which are mainly electronic in nature such as mass transit fare collection systems, air and ground combat training systems, and secure communications products. We provide services such as specialized military training exercises, including live, virtual and constructive training exercises and support, and we operate and maintain fare systems for mass transit customers. Our principal lines of business are transportation fare collection systems and services, defense services, and defense systems. Our principal customers for defense products and services are the U.S. and foreign governments. Our transportation fare collection systems and services are sold primarily to large local government agencies worldwide. In February 2015, we implemented a plan to restructure our defense services and defense systems businesses into a single business called Cubic Global Defense (CGD) to better align our defense business organizational structure with customer requirements, increase operational efficiencies and improve collaboration and innovation across the company. After this restructuring there is now a single, combined management structure for our legacy Cubic Defense Systems (CDS) and legacy Mission Support Services (MSS) segments. However, for segment financial reporting purposes, we continue to report the financial results of our defense systems and defense services segments separately. These two reporting segments have been renamed Cubic Global Defense Systems (CGD Systems) and Cubic Global Defense Services (CGD Services), respectively. There have been no significant changes in the operations that are included in each of these reporting segments as a result of the restructuring.
Principles of Consolidation	Principles of Consolidation : The consolidated financial statements include the accounts of Cubic Corporation, its majority-owned subsidiaries, and variable interest entities (VIE’s) for which Cubic is the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation.
Foreign Currency Transactions and Translation	Foreign Currency Transactions and Translation : Our reporting currency is the U.S. dollar. Assets and liabilities of foreign subsidiaries are translated at the spot rate in effect at the applicable reporting date, and our Consolidated Statements of Income are translated at the average exchange rates in effect during the applicable periods. The resulting unrealized cumulative translation adjustments are recorded as a component of other comprehensive income (loss) in our Consolidated Statements of Comprehensive Income (Loss). Cash flows from our operations in foreign countries are translated at the average rate for the applicable period. The effect of exchange rates on cash balances held in foreign currencies are separately reported in our Consolidated Statements of Cash Flows. Transactions denominated in currencies other than our own subsidiaries’ functional currencies are recorded based on exchange rates at the time such transactions arise. Changes in exchange rates with respect to amounts recorded in our Consolidated Balance Sheets related to such transactions result in transaction gains and losses that are reflected in our Consolidated Statements of Income as either unrealized (based on the applicable period end translation) or realized (upon settlement of the transactions). Total transaction losses, which are related primarily to advances to foreign subsidiaries and advances between foreign subsidiaries amounted to $3.2 million, $1.3 million and $0.8 million in 2015, 2014 and 2013, respectively.
Use of Estimates	Use of Estimates : The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include the estimated total costs at completion of our long-term contracts, estimated loss contingencies, estimated self-insurance liabilities, estimated discounted future cash flows of our reporting units used for goodwill impairment testing and estimated future cash flows for our long-lived asset impairment testing, estimated discounted cash flows used for valuation of intangible assets in business combinations, and estimated rates of return and discount rates related to our defined benefit pension plans. Actual results could differ from our estimates.
Cash Equivalents	Cash Equivalents : We consider highly liquid investments with maturity of three months or less when purchased to be cash equivalents. In fiscal 2015, we determined that $24.4 million of bank time deposits with maturities in excess of three months, which should have been classified as marketable securities, were inappropriately classified as cash equivalents in our September 30, 2014 Consolidated Balance Sheet. The purchases of these bank time deposits were inappropriately not presented as purchases of marketable securities in the investing section of our Consolidated Statement of Cash Flows for the year ended September 30, 2014. Based upon a quantitative and qualitative assessment of this error, we have determined that this error was not material to our Consolidated Financial Statements, and we have corrected the classification in the September 30, 2014 Balance Sheet, Statement of Cash Flows, and related footnote in the accompanying Consolidated Financial Statements.
Restricted Cash	Restricted Cash : Restricted cash represents cash that is restricted as to withdrawal usage for legal or contractual reasons. Restricted cash is classified either as current or non-current, depending upon the date of the lapse of the respective restriction.
Concentration of Credit Risk	Concentration of Credit Risk : We have established guidelines pursuant to which our cash and cash equivalents are diversified among various money market instruments and investment funds. These guidelines emphasize the preservation of capital by requiring minimum credit ratings assigned by established credit organizations. We achieve diversification by specifying maximum investments in each instrument type and issuer. The majority of these investments are not on deposit in federally insured accounts.
Marketable Securities	Marketable Securities : Marketable securities consist of time deposits with banks. Marketable securities are classified and accounted for as available-for-sale. These investments are recorded at fair value in the accompanying Consolidated Balance Sheets and the change in fair value is recorded, net of taxes, as a component of other comprehensive income. There have been no significant realized or unrealized gains or losses on these marketable securities to date. Marketable securities have been classified as current assets in the accompanying Consolidated Balance Sheets based upon the nature of the securities and availability for use in current operations.
Accounts Receivable	Accounts Receivable : Receivables consist primarily of amounts due from U.S. and foreign governments for defense products and services and local government agencies for transportation systems. Due to the nature of our customers, we generally do not require collateral. We have limited exposure to credit risk as we have historically collected substantially all of our receivables from government agencies. We generally require no allowance for doubtful accounts for these customers.
Inventories	Inventories : We state our inventories at the lower of cost or market. We determine cost using the first-in, first-out (FIFO) method, which approximates current replacement cost. We value our work in process at the actual production and engineering costs incurred to date, including applicable overhead. For contracts with the U.S. government our work in process also includes general and administrative costs. Any inventoried costs in excess of estimated realizable value are immediately charged to cost of sales. Where contracts include advances, performance-based payments and progress payments, we reflect the advances as an offset against any related inventory balances. We include qualifying contract costs allocable to units-of-delivery contracts as inventory. We also receive performance-based payments and progress payments associated with certain of these contracts based on the billing terms in the underlying contracts. Pursuant to contract provisions, agencies of the U.S. government and certain other customers have title to, or security interest in, inventories related to such contracts as a result of advances, performance-based payments, and progress payments. Contract advances, performance-based payments and progress payments received are recorded as an offset against the related inventory balances for contracts that that are accounted for on a percentage-of-completion basis using units-of-delivery as the basis to measure progress toward completing the contract. This determination is performed on a contract by contract basis. Any amount of payments received in excess of the cumulative amount of accounts receivable and inventoried costs for a contract is classified as customer advances, which is classified as a liability on the balance sheet.
Long-term capitalized contract costs	Long-term capitalized contract costs : Long-term capitalized contract costs include costs incurred on contracts to develop and manufacture transportation systems for customers for which revenue recognition does not begin until the customers begin operating the systems. These capitalized costs are being recognized in cost of sales based upon the ratio of revenue recorded during a period compared to the revenue expected to be recognized over the term of the contracts.
Property, Plant and Equipment	Property, Plant and Equipment : We carry property, plant and equipment at cost. We provide depreciation in amounts sufficient to amortize the cost of the depreciable assets over their estimated useful lives. Generally, we use straight-line methods for depreciable real property over estimated useful lives or the term of the underlying lease for leasehold improvements. We use accelerated methods (declining balance and sum-of-the-years-digits) for machinery and equipment over their estimated useful lives. Certain costs incurred in the development of internal-use software and software applications, including external direct costs of materials and services and applicable compensation costs of employees devoted to specific software development, are capitalized as computer software costs. Costs incurred outside of the application development stage are expensed as incurred. The amounts capitalized are included in property, plant and equipment and are amortized on a straight-line basis over the estimated useful life of the software, which ranges from three to seven years. No amortization expense is recorded until the software is ready for its intended use.
Goodwill and Purchased Intangibles	Goodwill and Purchased Intangibles : We evaluate goodwill for potential impairment annually as of July 1, or when circumstances indicate that the carrying value may not be recoverable. The test is performed by comparing the fair value of each of our reporting units, which are consistent with our operating segments, to its carrying value, including recorded goodwill. If the carrying value exceeds the fair value, we measure impairment by comparing the implied fair value of goodwill to its carrying value, and any impairment determined would be recorded in the current period. Our purchased intangible assets are subject to amortization and we use a combination of straight-line and accelerated methods, based on the expected cash flows from the assets. See Note 7 for a discussion of the impairment of our goodwill in 2013.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets : We generally evaluate the carrying values of long-lived assets other than goodwill for impairment only if events or changes in facts and circumstances indicate that carrying values may not be recoverable. If we determined there was any impairment, we would measure it by comparing the fair value of the related asset to its carrying value and record the difference in the current period. Fair value is generally determined by identifying estimated discounted cash flows to be generated by those assets. We have not recorded any impairment of long-lived assets for the years ended September 30, 2015, 2014 and 2013.
Recognizing assets acquired and liabilities assumed in a business combination	Recognizing assets acquired and liabilities assumed in a business combination : Acquired assets and assumed liabilities are recognized in a business combination on the basis of their fair values at the date of acquisition. We assess fair value, which is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, using a variety of methods including income approaches such as present value techniques or cost approaches such as the estimation of current selling prices and replacement values. Fair value of the assets acquired and liabilities assumed, including intangible assets, and contingent payments, are measured based on the assumptions and estimations with regards to the variable factors such as the amount and timing of future cash flows for the asset or liability being measured, appropriate risk-adjusted discount rates, nonperformance risk, or other factors that market participants would consider. Upon acquisition, we determine the estimated economic lives of the acquired intangible assets for amortization purposes, which are based on the underlying expected cash flows of such assets. Adjustments to inventory are based on the fair market value of inventory and amortized into income based on the period in which the underlying inventory is sold. Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Actual results may vary from projected results and assumptions used in the fair value assessments.
Customer Advances	Customer Advances : We receive advances, performance-based payments and progress payments from customers that may exceed revenues recognized on certain contracts, including contracts with agencies of the U.S. government. We classify such advances, other than those reflected as a reduction of receivables or inventories, as current liabilities.
Contingencies	Contingencies : We establish reserves for loss contingencies when, in the opinion of management, the likelihood of liability is probable and the extent of such liability is reasonably estimable. Estimates, by their nature, are based on judgment and currently available information and involve a variety of factors, including the type and nature of the litigation, claim or proceeding, the progress of the matter, the advice of legal counsel, our defenses and our experience in similar cases or proceedings as well as our assessment of matters, including settlements, involving other defendants in similar or related cases or proceedings. We may increase or decrease our legal reserves in the future, on a matter-by-matter basis, to account for developments in such matters.
Derivative Financial Instruments	Derivative Financial Instruments : All derivatives are recorded at fair value, however, the classification of gains and losses resulting from changes in the fair values of derivatives are dependent on the intended use of the derivative and its resulting designation. If a derivative is designated as a fair value hedge, then a change in the fair value of the derivative is offset against the change in the fair value of the underlying hedged item and only the ineffective portion of the hedge, if any, is recognized in cost of sales. If a derivative is designated as a cash flow hedge, then the effective portion of a change in the fair value of the derivative is recognized as a component of accumulated other comprehensive income until the underlying hedged item is recognized in cost of sales, or the forecasted transaction is no longer probable of occurring. If a derivative does not qualify as a highly effective hedge, a change in fair value is immediately recognized in earnings. We formally document hedging relationships for all derivative hedges and the underlying hedged items, as well as the risk management objectives and strategies for undertaking the hedge transactions.
Defined Benefit Pension Plans	Defined Benefit Pension Plans : Some of our employees are covered by defined benefit pension plans. The net periodic cost of our plans is determined using several actuarial assumptions, the most significant of which are the discount rate and the long-term rate of return on plan assets. We recognize on a plan-by-plan basis the funded status of our defined benefit pension plans as either an asset or liability on our balance sheets, with a corresponding adjustment to accumulated other comprehensive income (loss), net of tax, in shareholders’ equity. The funded status is measured as the difference between the fair value of the plan assets and the benefit obligation of the plan.
Comprehensive Income	Comprehensive Income : Other comprehensive income (loss), which is comprised of unrealized gains and losses on foreign currency translation adjustments, unrealized gains and losses on cash flow hedges, net of tax, unrealized gains and losses on available-for-sale securities, net of tax and pension liability adjustments, net of tax is included in our Consolidated Statement of Comprehensive Income as other comprehensive income (loss).
Revenue Recognition	Revenue Recognition : We generate revenue from the sale of products such as mass transit fare collection systems, air and ground combat training systems, and secure communications products. We also generate revenue from services we provide such as specialized military training exercises, including live, virtual and constructive training exercises and support, and we operate and maintain fare systems for mass transit customers. We classify sales as products or services in our Consolidated Statements of Income based on the attributes of the underlying contracts. We recognize sales and profits under our long-term fixed-price contracts which require a significant amount of development effort in relation to total contract value using the cost-to-cost percentage-of-completion method of accounting. We record sales and profits based on the ratio of contract costs incurred to estimated total contract costs at completion. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. For contracts with the U.S. federal government, general and administrative costs are included in contract costs; however, for purposes of revenue measurement, general and administrative costs are not considered contract costs for any other customers. Costs are recognized as incurred for contracts accounted for under the cost- to-cost percentage-of-completion method. For certain other long-term, fixed price production contracts not requiring substantial development effort we use the units-of-delivery percentage-of-completion method as the basis to measure progress toward completing the contract and recognizing sales. The units-of delivery measure recognizes revenues as deliveries are made to the customer generally using unit sales values in accordance with the contract terms. Costs of sales are recorded as deliveries are made. We estimate profit as the difference between total estimated revenue and total estimated cost of a contract and recognize that profit over the life of the contract based on deliveries. For long-term fixed price contracts, we only include amounts representing contract change orders, claims or other items in the contract value when they can be reliably estimated and we consider realization probable. Changes in estimates of sales, costs and profits are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes on current and prior periods. A significant change in one or more of these estimates could have a material effect on our consolidated financial position or results of operations. We record sales under cost-reimbursement-type contracts as we incur the costs. The Federal Acquisition Regulations provide guidance on the types of costs that we will be reimbursed in establishing the contract price. We consider incentives or penalties and awards applicable to performance on contracts in estimating sales and profits, and record them when there is sufficient information to assess anticipated contract performance. We do not recognize incentive provisions that increase or decrease earnings based solely on a single significant event until the event occurs. We occasionally enter into contracts that include multiple deliverables such as the construction or upgrade of a system and subsequent services to operate and maintain the delivered system. For such contracts, arrangement consideration is allocated at the inception of the arrangement to all deliverables using the relative-selling-price method. Under the relative-selling-price method, the selling price for each deliverable is determined using vendor specific objective evidence (VSOE) of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence of selling price exists for a deliverable, which is typically the case for our contracts, the guidance requires us to determine the best estimate of the selling price, which is the price at which we would sell the deliverable if it were sold on a standalone basis. In estimating the selling price of the deliverable on a standalone basis, we consider our overall pricing models and objectives, including the factors we contemplate in negotiating our contracts with our customers. The pricing models and objectives that we use are generally based upon a cost-plus margin approach, with the estimated margin based in part on qualitative factors such as perceived customer pricing sensitivity and competitive pressures. Once the contract value is allocated to the separate deliverables under a multiple-element arrangement, revenue recognition guidance relevant to each contractual element is followed. For example, for the long-term construction portion of a contract we generally use the percentage-of completion method and for the services portion we generally recognize the service revenues on a straight-line basis over the contractual service period or based on measurable units of work performed or incentives earned. For certain of our multiple-element arrangements, the contract specifies that we will not be paid upon the delivery of certain units of accounting, but rather we will be paid when subsequent performance obligations are satisfied. Generally, in these cases the allocation of arrangement consideration to the up-front deliverables is limited, in some cases to zero, and revenue is reduced, in some cases to zero for the delivery of up-front units of accounting. In such situations, if the costs associated with the delivered item exceed the amount of allocable arrangement consideration, we defer the direct and incremental costs associated with the delivered item that are in excess of the allocated arrangement consideration as capitalized contract costs. We assess recoverability of these costs by comparing the recorded asset to the deferred revenue in excess of the transaction price allocated to the remaining deliverables in the arrangement. Capitalized contract costs are subsequently recognized in income in a manner that is consistent with revenue recognition pattern for the arrangement as a whole. If no pattern of revenue recognition can be reasonably predicted for the arrangement, the capitalized costs are amortized on a straight-line basis. Revenue under our service contracts with the U.S. government is recorded under the cost-to cost percentage-of-completion method. Award fees and incentives related to performance under these service contracts are accrued during the performance of the contract based on our historical experience and estimates of success with such awards. Revenue under contracts for services other than those with the U.S. government and those associated with design, development, or production activities is recognized either as services are performed or when a contractually required event has occurred, depending on the contract. For such contracts that contain measurable units of work performed we recognize sales when the units of work are completed. Certain of our transportation systems service contracts contain service level or system usage incentives, for which we recognize revenues when the incentive award is fixed or determinable. These contract incentives are generally based upon monthly service levels or monthly performance and become fixed or determinable on a monthly basis. However, one of our transportation systems service contracts contains annual system usage incentives which are based upon system usage compared to annual baseline amounts. For this contract the annual system usage incentives are not considered fixed or determinable until the end of the contract year for which the incentives are measured, which falls within the second quarter of our fiscal year. Revenue under such contracts that do not contain measurable units of work performed, which is generally the case for our service contracts, is recognized on a straight- line basis over the contractual service period, unless evidence suggests that the revenue is earned, or obligations fulfilled, in a different manner. Costs incurred under these services contracts are expensed as incurred. We make provisions in the current period to fully recognize any anticipated losses on contracts. If we receive cash on a contract prior to revenue recognition or in excess of inventoried costs, we classify it as a customer advance on the balance sheet. In addition, we are subject to audit of incurred costs related to many of our U.S. government contracts. These audits could produce different results than we have estimated for revenue recognized on our cost-based contracts with the U.S. government; however, our experience has been that our costs are acceptable to the government.
Research and Development (R&D)	Research and Development (R&D) : We record the cost of company sponsored R&D activities as the expenses are incurred. The cost of engineering and product development activities incurred in connection with the performance of work on our contracts is included in cost of sales as they are directly related to contract performance.
Stock-Based Compensation	Stock-Based Compensation : Restricted stock units awards (RSUs) are granted to eligible employees and directors and represent rights to receive shares of common stock at a future date if vesting occurs. RSUs granted to date have either time-based vesting or performance-based vesting. Compensation expense for all RSUs is measured at fair value at the grant date and recognized based upon the number of RSUs that ultimately vest. We determine the fair value of RSUs based on the closing market price of our common stock on the grant date. The grant date of the performance-based RSUs takes place when the grant is authorized and the specific achievement goals are communicated. Compensation expense for time-based vesting awards is recorded on a straight-line basis over the requisite service period, adjusted by estimated forfeiture rates. Vesting of performance-based RSUs is tied to achievement of specific company goals over the measurement period, which is generally a three-year period from the date of the grant. For purposes of measuring compensation expense for performance-based RSUs, at each reporting date we estimate the number of shares for which vesting is deemed probable based on management’s expectations regarding achievement of the relevant performance criteria, adjusted by estimated forfeiture rates. Compensation expense for the number of shares ultimately expected to vest is recognized on a straight-line basis over the requisite service period for the performance-based RSUs. The recognition of compensation expense associated with performance-based RSUs requires judgment in assessing the probability of meeting the performance goals. For performance-based RSUs, there may be significant expense recognition or reversal of recognized expense in periods in which there are changes in the assessed probability of meeting performance-based vesting criteria.
Income Taxes	Income Taxes : Our provision for income taxes includes federal, state, local and foreign income taxes. We recognize tax credits, primarily for R&D, as a reduction of our provision for income taxes in the year in which they are generated. We provide deferred income taxes on temporary differences between assets and liabilities for financial reporting and tax purposes as measured by enacted tax rates we expect to apply when the temporary differences are settled or realized. We establish valuation allowances for deferred tax assets when the amount of future taxable income we expect is not likely to support the realization of the temporary differences. We evaluate the capital requirements of our foreign subsidiaries and determine the amount of excess capital, if any, that is available for distribution. We provide for U.S. taxes on the amount we determine to be excess capital available for distribution. U.S. taxes are not provided on amounts we consider to be permanently reinvested.
Net Income Per Share	Net Income Per Share : Basic net income per share (EPS) is computed by dividing the net income for the period by the weighted average number of common shares outstanding during the period, including vested RSUs. Diluted EPS is computed by dividing the net income for the period by the weighted average number of common and common equivalent shares outstanding during the period. Common equivalent shares consist of dilutive RSUs. Dilutive RSUs are calculated based on the average share price for each fiscal period using the treasury stock method. For RSUs with performance-based vesting, no common equivalent shares are included in the computation of diluted EPS until the related performance criteria have been met. Basic and diluted EPS are computed as follows (amounts in thousands, except per share data): Year Ended September 30, 2015 2014 2013 Net income attributable to Cubic $ $ $ Weighted average shares - basic Effect of dilutive securities Weighted average shares - diluted Net income per share attributable to Cubic, basic $ $ $ Effect of dilutive securities — — — Net income per share attributable to Cubic, diluted $ $ $ Anti-dilutive employee share-based awards — — —
Recent Accounting Pronouncements	Recent Accounting Pronouncements: In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers . ASU 2014-09 outlines a comprehensive revenue recognition model and supersedes most current revenue recognition guidance and will require revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. ASU 2014-09 will be effective for us starting in the first quarter of fiscal 2019 or we may adopt ASU 2014-09 early, in the first quarter of 2018. ASU 2014-09 allows for two methods of adoption: (a) “full retrospective” adoption, meaning the standard is applied to all periods presented, or (b) “modified retrospective” adoption, meaning the cumulative effect of applying ASU 2014-09 is recognized as an adjustment to the opening retained earnings balance in the year of adoption. We have not yet determined which method of adoption we will select or if we will choose to adopt the standard early. As the new standard will supersede substantially all existing revenue guidance affecting us under GAAP, it could impact revenue and cost recognition on a significant number of contracts across our business segments, in addition to our business processes and our information technology systems. As a result, our evaluation of the effect of the new standard will likely extend over several future periods. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern , which requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and provide related footnote disclosures. The guidance is effective for annual and interim reporting periods beginning on or after December 15, 2016, with early adoption permitted. ASU 2014-15 will be effective for us beginning in the first quarter of fiscal 2016. Early adoption is permitted for financial statements that have not been previously issued. This adoption is not expected to have a significant impact on our financial statements. In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis . The new standard modifies current guidance on consolidation under the variable interest model and the voting model. The guidance is effective for annual and interim reporting periods beginning on or after December 15, 2015, with early adoption permitted. ASU 2015-02 will be effective for us beginning in the first quarter of fiscal 2016. We are currently evaluating the impact of ASU 2015-02 on our consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs which requires that all costs incurred to issue debt be presented in the balance sheet as a direct reduction from the carrying value of the debt, similar to the presentation of debt discounts. ASU 2015-03 is effective for us on October 1, 2016 with early adoption permitted. We do not expect that the adoption of this new accounting guidance will have a material impact on our consolidated financial statements. In April 2015, the FASB issued ASU 2015-05, Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. ASU 2015-05 provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. ASU 2015-05 will be effective for us beginning on October 1, 2016, with early adoption permitted. We are currently assessing the impact that adopting this new accounting guidance will have on our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory . The new standard applies only to inventory for which cost is determined by methods other than last-in, first-out and the retail inventory method, which includes inventory that is measured using first-in, first-out or average cost. Inventory within the scope of this standard is required to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The new standard will be effective for us in the first quarter of fiscal 2018 with early adoption permitted. We are currently assessing the impact that adopting this new accounting guidance will have on our consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments . The new standard requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined and sets forth new disclosure requirements related to the adjustments. The new standard will be effective for us in the first quarter of fiscal 2017. We are currently assessing the impact that adopting this new accounting guidance will have on our consolidated financial statements
Audit Committee Investigation	Audit Committee Investigation In the first half of fiscal 2015, our Audit Committee conducted an investigation with the assistance of Latham & Watkins LLP and Deloitte FAS LLP to review our controls and procedures in connection with programs that are accounted for under the percentage of completion method. Through the application of our internal controls, management identified an issue which led to the investigation. As a result of the investigation, our Audit Committee and management determined that as of September 30, 2014, the total estimated costs of certain of our CGD Systems segment contracts were inappropriately reduced during its accounting close for the year ended September 30, 2014. The inappropriate reduction of the estimated costs to complete these contracts resulted in the overstatement of CGD Systems sales and operating income by approximately $750,000 for the fourth quarter and full year of fiscal 2014.
Correction of Immaterial Errors	Correction of Immaterial Errors During the accounting close for our March 31, 2015 financial statements, we identified certain errors, unrelated to the matters described in the paragraph above, in our September 30, 2014 financial statements. These errors included an overstatement of revenue recognition on one contract and the understatement of cost of sales on a small number of contracts. The cumulative impact of these errors resulted in an overstatement of our operating income for the year ended September 30, 2014 of $1.6 million. The cumulative amount of the errors described in the two paragraphs above overstated our operating income for fiscal 2014 by $2.4 million and understated our operating income for 2013 and prior years, cumulatively, by $0.3 million. The impact of correcting the above mentioned errors in the quarter ended December 31, 2014 understated operating income for the quarter by $2.1 million. The impact of correcting these errors (overstated) understated the following amounts in the quarter ended December 31, 2014 and the year ended September 30, 2015 (in thousands): Audit Committee Investigation Error Other Errors Total Errors Net sales: Products $ $ $ Costs and expenses: Products — Services — Selling, general and administrative — ) ) — ) ) Operating income Income before income taxes Income taxes Net income attributable to Cubic $ $ $ Based on a qualitative and quantitative analysis of these errors, management concluded that all such errors are cumulatively and individually considered immaterial to the 2014 financial statements and are immaterial to the full year results for 2015 and had no effect on the trend of financial results. As such, these errors have been corrected in the financial statements for the quarter ended December 31, 2014.

SUMMARY OF SIGNIFICANT ACCOUN27

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	12 Months Ended
	Sep. 30, 2015
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Schedule of computation of basic and diluted EPS	Basic and diluted EPS are computed as follows (amounts in thousands, except per share data): Year Ended September 30, 2015 2014 2013 Net income attributable to Cubic $ $ $ Weighted average shares - basic Effect of dilutive securities Weighted average shares - diluted Net income per share attributable to Cubic, basic $ $ $ Effect of dilutive securities — — — Net income per share attributable to Cubic, diluted $ $ $ Anti-dilutive employee share-based awards — — —
Schedule of impact of correcting the errors (overstated) understated	The impact of correcting these errors (overstated) understated the following amounts in the quarter ended December 31, 2014 and the year ended September 30, 2015 (in thousands): Audit Committee Investigation Error Other Errors Total Errors Net sales: Products $ $ $ Costs and expenses: Products — Services — Selling, general and administrative — ) ) — ) ) Operating income Income before income taxes Income taxes Net income attributable to Cubic $ $ $

ACQUISITIONS (Tables)

ACQUISITIONS (Tables)	12 Months Ended
	Sep. 30, 2015
Acquisitions
Schedule of estimated amortization expense related to acquisition	The table below shows our expected amortization of purchased intangibles as of September 30, 2015, for each of the next five years and thereafter (in thousands): Transportation Systems Cubic Global Defense Systems Cubic Global Defense Services Total 2016 $ $ $ $ 2017 2018 2019 2020 Thereafter $ $ $ $
Schedule of unaudited pro forma information	The following unaudited pro forma information presents our consolidated results of operations as if DTECH, Intific, Nextbus and ITMS had been included in our consolidated results since October 1, 2013 (in millions): Years Ended September 30, 2015 2014 Net sales $ $ Net income attributable to Cubic
DTECH LABS, Inc.
Acquisitions
Schedule of estimated fair values of the assets acquired and liabilities assumed at the acquisition date	The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Non compete agreements Backlog Cash Accounts receivable Inventory Warranty obligation ) Tax liabilities ) Accounts payable and accrued expenses ) Other net assets acquired Net identifiable assets acquired Goodwill Net assets acquired $
Schedule of estimated amortization expense related to acquisition	The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of DTECH for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter
Intific Inc.
Acquisitions
Schedule of estimated fair values of the assets acquired and liabilities assumed at the acquisition date	The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Technology Backlog Other intangible assets Accounts receivable Deferred tax assets Accounts payable and accrued expenses ) Deferred tax liabilities ) Other net assets acquired Net identifiable assets acquired Goodwill Net assets acquired $
Schedule of estimated amortization expense related to acquisition	The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of Intific for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter —
ITMS
Acquisitions
Schedule of estimated fair values of the assets acquired and liabilities assumed at the acquisition date	The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Intellectual property Backlog Supplier relationships Agreements with seller Accounts receivable - billed Accounts receivable - unbilled Deferred tax liabilities, net ) Deferred revenue ) Accounts payable and accrued expenses ) Other net assets acquired Net identifiable assets acquired Goodwill Net assets acquired $
Schedule of estimated amortization expense related to acquisition	The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of ITMS for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter —
NextBus, Inc.
Acquisitions
Schedule of estimated fair values of the assets acquired and liabilities assumed at the acquisition date	The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Accounts receivable, net Backlog Acquired technology Corporate trade names Accounts payable and accrued expenses ) Deferred tax liabilities, net ) Other net liabilities assumed ) Net identifiable assets acquired Goodwill Net assets acquired $
Schedule of estimated amortization expense related to acquisition	The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of NextBus for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter
NEK Special Programs Group LLC (NEK)
Acquisitions
Schedule of estimated fair values of the assets acquired and liabilities assumed at the acquisition date	The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date (in millions): Customer relationships $ Corporate trade names Non-compete agreements Accounts receivable -billed Accounts receivable -unbilled Accounts payable ) Other net liabilities assumed ) Net identifiable assets acquired Goodwill Net assets acquired $
Schedule of estimated amortization expense related to acquisition	The estimated amortization expense related to the intangible assets recorded in connection with our acquisition of NEK for future periods is as follows (in millions): Year Ended September 30, 2016 $ 2017 2018 2019 2020 Thereafter

FAIR VALUE OF FINANCIAL INSTR29

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)	12 Months Ended
	Sep. 30, 2015
FAIR VALUE OF FINANCIAL INSTRUMENTS
Summary of change in fair value of Level 3 contingent consideration liability	From December 16, 2014, the date of acquisition of DTECH, through September 30, 2015 the following table summarizes the change in fair value of our Level 3 contingent consideration liability (in thousands): Balance as of December 16, 2014 $ Total remeasurement recognized in earnings Balance as of September 30, 2015 $
Summary of assets and liabilities measured and recorded at fair value on Balance Sheet on a recurring basis	The following table presents assets and liabilities measured and recorded at fair value on our balance sheets on a recurring basis (in thousands): September 30, 2015 September 30, 2014 Level 1 Level 2 Level 3 Total Level 1 Level 2 Total Assets Cash equivalents $ $ — $ — $ $ $ $ Marketable securities — — — Current derivative assets — — — Noncurrent derivative assets — — — Marketable securities in rabbi trust — — — — — Total assets measured at fair value — Liabilities Current derivative liabilities — — — Noncurrent derivative liabilities — — — Current contingent consideration to seller of DTECH — — — — — Noncurrent contingent consideration to seller of DTECH — — — — — Total liabilities measured at fair value $ — $ $ $ $ — $ $
Schedule of estimated fair value and carrying value of our long-term debt	The following table presents the estimated fair value and carrying value of our long-term debt (in millions): September 30, 2015 2014 Fair value $ $ Carrying value

ACCOUNTS RECEIVABLE (Tables)

ACCOUNTS RECEIVABLE (Tables)	12 Months Ended
	Sep. 30, 2015
ACCOUNTS RECEIVABLE
Schedule of components of accounts receivable	The components of accounts receivable under long-term contracts are as follows (in thousands): September 30, 2015 2014 U.S. Government Contracts: Amounts billed $ $ Recoverable costs and accrued profits on progress completed—not billed Commercial Customers: Amounts billed Recoverable costs and accrued profits on progress completed—not billed Less unbilled amounts not currently due—commercial customers ) ) $ $

INVENTORIES (Tables)

INVENTORIES (Tables)	12 Months Ended
	Sep. 30, 2015
INVENTORIES
Components of inventories	Significant components of inventories are as follows (in thousands): September 30, 2015 2014 Finished products $ $ — Work in process and inventoried costs under long-term contracts Materials and purchased parts Customer advances ) ) $ $

PROPERTY, PLANT AND EQUIPMENT (

PROPERTY, PLANT AND EQUIPMENT (Tables)	12 Months Ended
	Sep. 30, 2015
PROPERTY, PLANT AND EQUIPMENT
Components of property, plant and equipment	Significant components of property, plant and equipment are as follows (in thousands): September 30, 2015 2014 Land and land improvements $ $ Buildings and improvements Machinery and other equipment Software Leasehold improvements Construction and internal-use software development in progress — Accumulated depreciation and amortization ) ) $ $

GOODWILL AND PURCHASED INTANG33

GOODWILL AND PURCHASED INTANGIBLE ASSETS (Tables)	12 Months Ended
	Sep. 30, 2015
GOODWILL AND PURCHASED INTANGIBLE ASSETS
Schedule of changes in the carrying amount of goodwill	The changes in the carrying amount of goodwill for the two years ended September 30, 2015 are as follows (in thousands): Transportation Systems Cubic Global Defense Systems Cubic Global Defense Services Total Balances at October 1, 2013 $ $ $ $ Acquisitions (see Note 2) — Foreign currency exchange rate changes ) — ) Balances at September 30, 2014 Acquisitions (see Note 2) — — Foreign currency exchange rate changes ) ) — ) Balances at September 30, 2015 $ $ $ $
Schedule of entity's purchased intangible assets	The table below summarizes our purchased intangible assets (in thousands): September 30, 2015 September 30, 2014 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Contract and program intangibles $ $ ) $ $ ) $ Other purchased intangibles ) ) Total $ $ ) $ $ $ ) $
Schedule of expected amortization of purchased intangibles for each of the next five years	The table below shows our expected amortization of purchased intangibles as of September 30, 2015, for each of the next five years and thereafter (in thousands): Transportation Systems Cubic Global Defense Systems Cubic Global Defense Services Total 2016 $ $ $ $ 2017 2018 2019 2020 Thereafter $ $ $ $

FINANCING ARRANGEMENTS (Tables)

FINANCING ARRANGEMENTS (Tables)	12 Months Ended
	Sep. 30, 2015
FINANCING ARRANGEMENTS
Schedule of long-term debt	Long-term debt consists of the following (in thousands): September 30, 2015 2014 Series A senior unsecured notes payable to a group of insurance companies, interest fixed at 3.35% $ $ Series B senior unsecured notes payable to a group of insurance companies, interest fixed at 3.35% Series C senior unsecured notes payable to a group of insurance companies, interest fixed at 3.70% — Mortgage note from a U.K. financial institution, with quarterly installments of principal and interest at 6.48% Less current portion ) ) $ $

COMMITMENTS (Tables)

COMMITMENTS (Tables)	12 Months Ended
	Sep. 30, 2015
COMMITMENTS
Summary of future minimum payments, net of minimum sublease income, under noncancelable operating leases	Future minimum payments, net of minimum sublease income, under non-cancelable operating leases with initial terms of one year or more consist of the following for the next five years and thereafter, as of September 30, 2015 (in thousands): 2016 $ 2017 2018 2019 2020 Thereafter $

INCOME TAXES (Tables)

INCOME TAXES (Tables)	12 Months Ended
	Sep. 30, 2015
INCOME TAXES
Components of income (loss) before income taxes	Income (loss) before income taxes includes the following components (in thousands): Years ended September 30, 2015 2014 2013 (in thousands) United States $ ) $ ) $ ) Foreign Total $ $ $
Significant components of the provision for income taxes	Years ended September 30, 2015 2014 2013 (in thousands) Current: Federal $ ) $ ) $ State Foreign Total current Deferred: Federal ) State ) ) Foreign Total deferred ) Provision for income taxes $ $ $
Reconciliation of income tax computed at the U.S. federal statutory tax rate to income tax expense	Years ended September 30, 2015 2014 2013 (in thousands) Tax expense at U.S. statutory rate $ $ $ State income taxes, net of federal tax effect ) Nondeductible expenses Change in reserve for tax contingencies ) ) ) Impact of goodwill impairment loss — — Change in deferred tax asset valuation allowance Foreign earnings taxed at less than statutory rate ) ) ) Tax credits generated in the current year ) ) ) Reinstatement of federal research and development credit ) — ) Manufacturing deduction — — ) Other ) Provision for income taxes $ $ $
Significant components of deferred tax assets and liabilities	September 30, 2015 2014 (in thousands) Deferred tax assets: Accrued employee benefits $ $ Long-term contracts and inventory valuation reductions Allowances for loss contingencies Deferred compensation Property, plant and equipment Intangible assets Retirement benefits Tax credit carryforwards Net operating losses carryforwards Other Total gross deferred tax assets Valuation allowance ) ) Total deferred tax assets Deferred tax liabilities: Deferred revenue ) ) Other ) ) Total deferred tax liabilities ) ) Net deferred tax asset (liability) $ ) $
Net changes in the liability for unrecognized tax benefits	Years ended September 30, 2015 2014 (in thousands) Balance at beginning of year $ $ Increase (decrease) related to tax positions in prior years: Recognition of benefits from expiration of statutes ) ) Settlements with taxing authorities — ) Other ) Tax positions related to the current year Tax positions related to current year acquisitions — Currency translation adjustment — ) Balance at end of year $ $

DERIVATIVE INSTRUMENTS AND HE37

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)	12 Months Ended
	Sep. 30, 2015
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
Schedule of notional principal amounts of the outstanding derivative instruments	The following table shows the notional principal amounts of our outstanding derivative instruments as of September 30, 2015 and 2014 (in thousands): Notional Principal September 30, 2015 2014 Instruments designated as accounting hedges: Foreign currency forwards $ $ Instruments not designated as accounting hedges: Foreign currency forwards $ $
Schedule of fair value of derivative financial instruments	The table below presents the fair value of our derivative financial instruments that qualify for hedge accounting as well as their classification on the consolidated balance sheets as of September 30, 2015 and 2014 (in thousands): Fair Value September 30, Balance Sheet Location 2015 2014 Asset derivatives: Foreign currency forwards Other current assets $ $ Foreign currency forwards Other noncurrent assets $ $ Liability derivatives: Foreign currency forwards Other current liabilities $ $ Foreign currency forwards Other noncurrent liabilities Total $ $
Schedule of gains and losses recognized in other comprehensive income (loss) on derivative financial instruments designated as cash flow hedges	The tables below present gains and losses recognized in OCI for the years ended September 30, 2015 and 2014 related to derivative financial instruments designated as cash flow hedges, as well as the amount of gains and losses reclassified into earnings during those periods (in thousands): Years ended September 30, 2015 2014 2015 2014 Derivative Type Gains (losses) recognized in OCI Gains (losses) reclassified into earnings - Effective Portion Gains (losses) recognized in OCI Gains (losses) reclassified into earnings - Effective Portion Location of gain (loss) Gains (losses) recognized - Ineffective Portion and amount excluded from effectiveness testing Foreign currency forwards $ $ $ $ Other income/(expense), net $ $ — Forward starting swap — — — — Other income/(expense), net — $ $ $ $ $ $

PENSION, PROFIT SHARING AND O38

PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS (Tables)	12 Months Ended
	Sep. 30, 2015
PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS
Schedule of projected benefit obligation, ABO and fair value of plan assets for the defined benefit pension plans in which the ABO was in excess of the fair value of plan assets	The projected benefit obligation, accumulated benefit obligation (ABO) and fair value of plan assets for the defined benefit pension plans were as follows (in thousands): September 30, 2015 2014 Projected benefit obligation $ $ Accumulated benefit obligation Fair value of plan assets
Schedule of changes in the projected benefit obligation and fair value of plan assets and the funded status	The following table sets forth changes in the projected benefit obligation and fair value of plan assets and the funded status for these defined benefit plans (in thousands): September 30, 2015 2014 Change in benefit obligations: Net benefit obligation at the beginning of the year $ $ Service cost Interest cost Actuarial loss (gain) Plan amendments — ) Gross benefits paid ) ) Foreign currency exchange rate changes ) Net benefit obligation at the end of the year Change in plan assets: Fair value of plan assets at the beginning of the year Actual return on plan assets Employer contributions Gross benefits paid ) ) Administrative expenses ) ) Foreign currency exchange rate changes ) Fair value of plan assets at the end of the year Unfunded status of the plans ) ) Unrecognized net actuarial loss Net amount recognized $ $ Amounts recognized in Accumulated OCI Liability adjustment to OCI $ ) $ ) Deferred tax asset Valuation allowance on deferred tax asset ) — Accumulated other comprehensive loss $ ) $ )
Components of net periodic pension cost (benefit)	The components of net periodic pension cost (benefit) were as follows (in thousands): Years ended September 30, 2015 2014 2013 Service cost $ $ $ Interest cost Expected return on plan assets ) ) ) Amortization of actuarial loss Administrative expenses Net pension benefit $ ) $ ) $ )
Schedule of weighted-average assumptions used to determine benefit obligation and net periodic benefit cost	Years ended September 30, 2015 2014 2013 Weighted-average assumptions used to determine benefit obligation at September 30: Discount rate % % % Rate of compensation increase % % % Weighted-average assumptions used to determine net periodic benefit cost for the years ended September 30: Discount rate % % % Expected return on plan assets % % % Rate of compensation increase % % %
Schedule of target ranges for each major category of the plans' assets	The target ranges for each major category of the plans’ assets at September 30, 2015 are as follows: Asset Category Allocation Range Equity securities 20% to 55% Debt securities 25% to 75% Cash 0% to 55% Real estate 0% to 10%
Schedule of fair value of the assets of defined benefit pension plans by asset category and their level within the fair value hierarchy	September 30, 2015 September 30, 2014 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents $ $ $ — $ $ $ $ — $ Equity: U.S. equity securities — — — — Foreign equity securities — — — — Fixed Income: U.S. fixed-income funds — — — — U.K. fixed-income funds — — — — Diversified growth fund — — Real Estate — — — — Total $ $ $ $ $ $ $ $
Schedule of changes during the fiscal year in the fair value of plan assets categorized as Level 3	The following table presents the changes in the fair value of plan assets categorized as Level 3 in the preceding table (in thousands): Real Estate Balance as of October 1, 2013 $ Realized and unrealized gains, net Purchases, sales and settlements, net ) Balance as of September 30, 2014 Realized and unrealized gains, net Purchases, sales and settlements, net ) Balance as of September 30, 2015 $
Schedule of expected pension benefit payments, which reflect expected future service	We expect to pay the following pension benefit payments, which reflect expected future service, as appropriate, (in thousands): 2016 $ 2017 2018 2019 2020 2021-2025

STOCKHOLDERS' EQUITY (Tables)

STOCKHOLDERS' EQUITY (Tables)	12 Months Ended
	Sep. 30, 2015
STOCKHOLDERS' EQUITY
Summary of RSU activity	Unvested Restricted Stock Units Number of Shares Weighted-Average Grant-Date Fair Value Unvested at October 1, 2013 $ Granted Vested ) Forfeited ) Unvested at September 30, 2014 $ Granted Vested ) Forfeited ) Unvested at September 30, 2015 $

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	12 Months Ended
	Sep. 30, 2015
STOCK-BASED COMPENSATION
Schedule of stock-based compensation expense related to stock-based awards	We recorded non-cash compensation expense related to stock-based awards of $8.3 million for the year ended September 30, 2015, which was comprised of the following (in thousands): Cost of sales $ Selling, general and administrative $

BUSINESS SEGMENT INFORMATION (T

BUSINESS SEGMENT INFORMATION (Tables)	12 Months Ended
	Sep. 30, 2015
BUSINESS SEGMENT INFORMATION
Schedule of business segment financial data	Business segment financial data is as follows (in millions): Years ended September 30, 2015 2014 2013 Sales: Cubic Transportation Systems $ $ $ Cubic Global Defense Services Cubic Global Defense Systems Other — — Total sales $ $ $ Operating income (loss): Cubic Transportation Systems $ $ $ Cubic Global Defense Services ) Cubic Global Defense Systems Unallocated corporate expenses and other ) ) ) Total operating income $ $ $ Assets: Cubic Transportation Systems $ $ $ Cubic Global Defense Services Cubic Global Defense Systems Corporate and other Total assets $ $ $ Depreciation and amortization: Cubic Transportation Systems $ $ $ Cubic Global Defense Services Cubic Global Defense Systems Corporate and other Total depreciation and amortization $ $ $ Capital expenditures: Cubic Transportation Systems $ $ $ Cubic Global Defense Services — — Cubic Global Defense Systems Corporate and other Total expenditures for long-lived assets $ $ $
Schedule of sales by geographic area	Business segment financial data is as follows (in millions): Years ended September 30, 2015 2014 2013 Geographic Information: Sales (a): United States $ $ $ United Kingdom Canada Australia Middle East Far East Other Total sales $ $ $ (a) Sales are attributed to countries or regions based on the location of customers.
Schedule of long-lived assets by country	Business segment financial data is as follows (in millions): Long-lived assets, net: United States $ $ $ United Kingdom Other foreign countries Total long-lived assets, net $ $ $
Summary of the activity relating to the restructuring liability and employee separation expenses	A summary of the activity relating to the restructuring liability and employee separation expenses, which is included within accrued compensation and other current liabilities within our Consolidated Balance Sheet, is as follows (in thousands): Liability as of October 1, 2013 $ Accrued costs Cash payments ) Liability as of September 30, 2014 $ Accrued costs Cash payments ) Liability as of September 30, 2015 $

SUMMARY OF QUARTERLY RESULTS 42

SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Tables)	12 Months Ended
	Sep. 30, 2015
SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
Summary of quarterly results of operations	Year Three Months Ended Ended Fiscal 2015 September 30 June 30 March 31 December 31 September 30 (in thousands, except per share data) Net sales $ $ $ $ $ Operating income Net income (loss) attributable to Cubic ) Net income (loss) per share, basic ) Net income (loss) per share, diluted ) Year Three Months Ended Ended Fiscal 2014 September 30 June 30 March 31 December 31 September 30 (in thousands, except per share data) Net sales $ $ $ $ $ Operating income (loss) Net income (loss) attributable to Cubic Net income (loss) per share, basic Net income (loss) per share, diluted

SUMMARY OF SIGNIFICANT ACCOUN43

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Millions	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Total transaction gains (losses) related primarily to advances to and between foreign subsidiaries	$ (3.2)	$ (1.3)	$ (0.8)
Cash Equivalents
Time deposits inappropriately classified as cash equivalents		24.4
Accounts Receivable
Allowance for doubtful accounts	0
Impairment of Long-Lived Assets
Impairment of long-lived assets	$ 0	$ 0	$ 0

SUMMARY OF SIGNIFICANT ACCOUN44

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2015USD ($)$ / shares	Jun. 30, 2015USD ($)$ / shares	Mar. 31, 2015USD ($)$ / shares	Dec. 31, 2014USD ($)$ / shares	Sep. 30, 2014USD ($)$ / shares	Jun. 30, 2014USD ($)$ / shares	Mar. 31, 2014USD ($)$ / shares	Dec. 31, 2013USD ($)$ / shares	Sep. 30, 2015USD ($)item$ / sharesshares	Sep. 30, 2014USD ($)$ / sharesshares	Sep. 30, 2013USD ($)$ / sharesshares
Revenue Recognition
Number of estimates, a change in which could have material effect on financial position or results of operations | item									1
Allocation of arrangement consideration to the up-front deliverables									$ 0
Revenue for the delivery of up-front units of accounting									$ 0
Number of transportation systems service contracts, which contain annual system usage incentives | item									1
Stock-Based Compensation
Vesting period of performance-based RSUs									3 years
Net Income Per Share
Net income attributable to Cubic	$ 19,977	$ 8,780	$ (11,024)	$ 5,152	$ 32,805	$ 12,206	$ 16,092	$ 8,388	$ 22,885	$ 69,491	$ 25,086
Weighted average shares - basic | shares									26,872	26,787	26,736
Effect of dilutive securities (in shares) | shares									66	58	24
Weighted average shares - diluted | shares									26,938	26,845	26,760
Basic (in dollars per share) | $ / shares	$ 0.74	$ 0.33	$ (0.41)	$ 0.19	$ 1.22	$ 0.46	$ 0.60	$ 0.31	$ 0.85	$ 2.59	$ 0.94
Diluted (in dollars per share) | $ / shares	$ 0.74	$ 0.33	$ (0.41)	$ 0.19	$ 1.22	$ 0.45	$ 0.60	$ 0.31	$ 0.85	$ 2.59	$ 0.94

SUMMARY OF SIGNIFICANT ACCOUN45

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) - Adjustments	3 Months Ended	12 Months Ended
	Sep. 30, 2014USD ($)	Sep. 30, 2014USD ($)item
Audit Committee Investigation
Quantifying Misstatement in Current Year Financial Statements
Quantifying immaterial misstatement amount	$ 750,000	$ 750,000
Correction Of Immaterial Errors
Quantifying Misstatement in Current Year Financial Statements
Quantifying immaterial misstatement amount		$ 1,600,000
Number of contracts | item		1
Interim Goodwill Impairment Test
Number of contracts | item		1

SUMMARY OF SIGNIFICANT ACCOUN46

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended			24 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014
Net sales:
Products									$ 607,226	$ 583,937	$ 562,310
Costs and expenses:
Products									451,295	424,682	425,793
Services									640,031	657,853	629,520
Selling, general and administrative expenses									212,518	181,672	165,230
Total costs and expenses									1,355,658	1,305,862	1,320,672
Operating income	$ 34,709	$ 10,293	$ 23,206	$ 7,179	$ 39,268	$ 19,215	$ 22,177	$ 11,830	75,387	92,490	40,735
Income before income taxes									71,911	89,411	39,771
Income taxes									48,997	19,831	14,502
Net income attributable to Cubic	$ 19,977	$ 8,780	$ (11,024)	5,152	$ 32,805	$ 12,206	$ 16,092	$ 8,388	22,885	69,491	25,086
Adjustments
Net sales:
Products				1,264					1,264
Costs and expenses:
Products				138					138
Services				438					438
Selling, general and administrative expenses				(1,385)					(1,385)
Total costs and expenses				(809)					(809)
Operating income				2,073					2,073	$ 2,400	$ 300	$ 2,100
Income before income taxes				2,073					2,073
Income taxes				789					789
Net income attributable to Cubic				1,284					1,284
Adjustments | Audit Committee Investigation Error
Net sales:
Products				747					747
Costs and expenses:
Operating income				747					747
Income before income taxes				747					747
Income taxes				299					299
Net income attributable to Cubic				448					448
Adjustments | Other Errors
Net sales:
Products				517					517
Costs and expenses:
Products				138					138
Services				438					438
Selling, general and administrative expenses				(1,385)					(1,385)
Total costs and expenses				(809)					(809)
Operating income				1,326					1,326
Income before income taxes				1,326					1,326
Income taxes				490					490
Net income attributable to Cubic				$ 836					$ 836

ACQUISITIONS (Details)

ACQUISITIONS (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 16, 2014	Feb. 28, 2014	Nov. 26, 2013	Jan. 24, 2013	Dec. 14, 2012	May. 31, 2014	Nov. 30, 2013	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2015	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Acquisitions
Net sales									$ 425,917	$ 347,806	$ 338,834	$ 318,488	$ 396,366	$ 340,357	$ 354,492	$ 307,137		$ 1,431,045	$ 1,398,352	$ 1,361,407
Net income (loss) after taxes																		22,914	69,580	25,269
Purchase price allocation
Goodwill	$ 237,899								237,899				$ 184,141				$ 237,899	237,899	184,141	136,094
Estimated amortization expense related to the intangible assets
2,016	21,552								21,552								21,552	21,552
2,017	16,348								16,348								16,348	16,348
2,018	12,999								12,999								12,999	12,999
2,019	8,516								8,516								8,516	8,516
2,020	4,626								4,626								4,626	4,626
Thereafter	8,895								8,895								8,895	8,895
Unaudited pro forma information
Net sales																		1,440,700	1,458,900
Net income attributable to Cubic																		23,900	73,200
Adjustments made for transaction expenses																		0
DTECH LABS, Inc.
Acquisitions
Net sales																		45,800
Net income (loss) after taxes																		(500)
Transaction and acquisition related costs																		800
General and administrative expenses																		3,600
Cost of acquisition net		$ 99,500
Fair value of consideration transferred		99,400
Cash consideration paid																	91,300
Additional cash consideration accelerated if certain event occurs		4,700
Fair value of the potential customer		4,300
Estimated fair value of the liability for contingent consideration	7,500	3,900							7,500								7,500	7,500
Cumulative change in fair value of contingent consideration recognized as expense																		3,600
Fair value of additional cash consideration due to the seller, including the Holdback Consideration and contingent consideration	11,800								11,800								11,800	11,800
Purchase price allocation
Cash		900
Accounts receivable		5,400
Inventory		4,200
Warranty obligation		(400)
Accounts payable and accrued expenses		(3,400)
Deferred tax liabilities		(3,300)
Other net assets acquired		200
Net identifiable assets acquired		41,500
Goodwill		57,900
Net assets acquired		$ 99,400
Weighted average useful life of intangible assets		2 years
Estimated amortization expense related to the intangible assets
2,016		$ 8,000
2,017		6,800
2,018		5,500
2,019		4,100
2,020		2,800
Thereafter		1,500
DTECH LABS, Inc. | Maximum
Acquisitions
Contingent Amount		15,000
DTECH LABS, Inc. | Customer relationships
Purchase price allocation
Amortizable intangible assets		35,100
DTECH LABS, Inc. | Non-compete agreements
Purchase price allocation
Amortizable intangible assets		700
DTECH LABS, Inc. | Backlog
Purchase price allocation
Amortizable intangible assets		$ 2,100
Intific Inc.
Acquisitions
Net sales																		14,700	5,300
Net income (loss) after taxes																		(1,800)	(4,200)
Fair value of consideration transferred			$ 12,400
Cash consideration paid																		1,200	11,200
Purchase price allocation
Other intangible assets			200
Accounts receivable			1,500
Deferred tax assets			1,500
Accounts payable and accrued expenses			(600)
Deferred tax liabilities			(1,500)
Other net assets acquired			500
Net identifiable assets acquired			5,000
Goodwill			7,400
Net assets acquired			$ 12,400
Weighted average useful life of intangible assets			2 years
Estimated amortization expense related to the intangible assets
2,016	700								700								700	700
2,017	600								600								600	600
2,018	500								500								500	500
2,019	200								200								200	200
2,020	100								100								100	100
Intific Inc. | Customer relationships
Purchase price allocation
Amortizable intangible assets			$ 2,000
Intific Inc. | Technology
Purchase price allocation
Amortizable intangible assets			700
Intific Inc. | Backlog
Purchase price allocation
Amortizable intangible assets			$ 700
ITMS
Acquisitions
Net sales																		47,000	43,700
Net income (loss) after taxes																		(3,000)	(2,300)
Transaction and acquisition related costs																			500
Fair value of consideration transferred				$ 72,200
Cash consideration paid							$ 3,200	$ 69,000
Purchase price allocation
Accounts receivable - billed				4,400
Accounts receivable - unbilled				6,900
Accounts payable and accrued expenses				(4,600)
Deferred tax liabilities				(200)
Deferred revenue				(2,600)
Other net assets acquired				2,600
Net identifiable assets acquired				31,400
Goodwill				40,800
Net assets acquired				$ 72,200
Weighted average useful life of intangible assets				2 years
Estimated amortization expense related to the intangible assets
2,016	4,600								4,600								4,600	4,600
2,017	3,600								3,600								3,600	3,600
2,018	2,700								2,700								2,700	2,700
2,019	900								900								900	900
2,020	100								100								100	100
ITMS | Customer relationships
Purchase price allocation
Amortizable intangible assets				$ 15,700
ITMS | Intellectual property
Purchase price allocation
Amortizable intangible assets				1,600
ITMS | Backlog
Purchase price allocation
Amortizable intangible assets				5,700
ITMS | Supplier relationships
Purchase price allocation
Amortizable intangible assets				600
ITMS | Agreements with Seller
Purchase price allocation
Amortizable intangible assets				$ 1,300
NextBus, Inc.
Acquisitions
Net sales																		12,100	10,100	7,800
Net income (loss) after taxes																		400	(600)	(400)
Transaction and acquisition related costs																				200
Cash consideration paid					$ 20,200
Purchase price allocation
Accounts receivable					2,200
Accounts payable and accrued expenses					(1,100)
Deferred tax liabilities					(3,300)
Other net liabilities assumed					(1,200)
Net identifiable assets acquired					9,400
Goodwill					10,800
Net assets acquired					$ 20,200
Weighted average useful life of intangible assets					5 years
Estimated amortization expense related to the intangible assets
2,016	1,400								1,400								1,400	1,400
2,017	1,300								1,300								1,300	1,300
2,018	1,200								1,200								1,200	1,200
2,019	1,100								1,100								1,100	1,100
2,020	900								900								900	900
Thereafter	2,800								2,800								2,800	2,800
NextBus, Inc. | Customer relationships
Purchase price allocation
Amortizable intangible assets					$ 8,800
NextBus, Inc. | Corporate trade names
Purchase price allocation
Amortizable intangible assets					1,000
NextBus, Inc. | Technology
Purchase price allocation
Amortizable intangible assets					1,300
NextBus, Inc. | Backlog
Purchase price allocation
Amortizable intangible assets					$ 1,700
NEK Special Programs Group LLC (NEK)
Acquisitions
Net sales																		55,600	45,000	31,600
Net income (loss) after taxes																			(600)	(500)
Transaction and acquisition related costs																				600
Cash consideration paid						$ 52,600
Additional cash consideration accelerated if certain event occurs																			$ 2,400	$ 7,800
Purchase price allocation
Accounts receivable - billed						3,100
Accounts receivable - unbilled						7,700
Accounts payable and accrued expenses						(3,000)
Other net liabilities assumed						(400)
Net identifiable assets acquired						25,800
Goodwill						26,800
Net assets acquired						$ 52,600
Weighted average useful life of intangible assets						4 years
Estimated amortization expense related to the intangible assets
2,016	2,400								2,400								2,400	2,400
2,017	1,900								1,900								1,900	1,900
2,018	1,400								1,400								1,400	1,400
2,019	800								800								800	800
2,020	400								400								400	400
Thereafter	2,400								$ 2,400								$ 2,400	2,400
NEK Special Programs Group LLC (NEK) | Maximum
Acquisitions
Net income (loss) after taxes																		$ (100)
NEK Special Programs Group LLC (NEK) | Customer relationships
Purchase price allocation
Amortizable intangible assets						$ 13,300
NEK Special Programs Group LLC (NEK) | Corporate trade names
Purchase price allocation
Amortizable intangible assets						4,900
NEK Special Programs Group LLC (NEK) | Non-compete agreements
Purchase price allocation
Amortizable intangible assets						$ 200
Transaction Systems Limited (TranSys)
Acquisitions
Cost of acquisition net	$ 1,000
Ownership percentage																		50.00%

FAIR VALUE OF FINANCIAL INSTR48

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands	10 Months Ended	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2015	Dec. 16, 2014	Dec. 14, 2014	Sep. 30, 2014
Assets and liabilities measured at fair value on a recurring basis
Change in fair value of contingent consideration		$ 3,607
Debt instruments
Carrying value	$ 126,705	126,705			$ 102,390
Level 2 assets erroneously reported as Level 1 assets | Marketable securities
Assets and liabilities measured at fair value on a recurring basis
Quantifying immaterial misstatement amount		25,600
Level 2 assets erroneously reported as Level 1 assets | Cash Equivalents [Member]
Assets and liabilities measured at fair value on a recurring basis
Quantifying immaterial misstatement amount		10,200
DTECH LABS, Inc.
Assets and liabilities measured at fair value on a recurring basis
Estimated fair value of the liability for contingent consideration	7,500	7,500	$ 3,900
Level 2
Debt instruments
Fair Value	125,800	125,800			99,900
Carrying value	126,700	$ 126,700			102,400
Level 3 | DTECH LABS, Inc.
Assets and liabilities measured at fair value on a recurring basis
Volatility for underlying earnings metrics used in determination of fair value of contingent consideration		22.00%
Estimated fair value of the liability for contingent consideration	7,507,000	$ 7,507,000		$ 3,900,000
Change in fair value of contingent consideration since the date of the acquisition	3,607,000
Assets and liabilities measured at fair value | Total
Assets
Cash equivalents	68,194	68,194			56,333
Marketable securities	30,533	30,533			25,557
Current derivative assets	11,543	11,543			7,389
Noncurrent derivative assets	13,909	13,909			5,920
Total assets measured at fair value	125,171	125,171			95,199
Liabilities
Current derivative liabilities	9,370	9,370			6,645
Noncurrent derivative liabilities	13,909	13,909			5,878
Total liabilities measured at fair value	30,786	30,786			12,523
Assets and liabilities measured at fair value | DTECH LABS, Inc. | Total
Liabilities
Current contingent consideration to seller	5,000	5,000
Noncurrent contingent consideration to seller	2,507	2,507
Assets and liabilities measured at fair value | Rabbi trust | Total
Assets
Marketable securities	992	992
Assets and liabilities measured at fair value | Level 1
Assets
Cash equivalents	68,194	68,194			46,183
Total assets measured at fair value	69,186	69,186			46,183
Assets and liabilities measured at fair value | Level 1 | Rabbi trust
Assets
Marketable securities	992	992
Assets and liabilities measured at fair value | Level 2
Assets
Cash equivalents					10,150
Marketable securities	30,533	30,533			25,557
Current derivative assets	11,543	11,543			7,389
Noncurrent derivative assets	13,909	13,909			5,920
Total assets measured at fair value	55,985	55,985			49,016
Liabilities
Current derivative liabilities	9,370	9,370			6,645
Noncurrent derivative liabilities	13,909	13,909			5,878
Total liabilities measured at fair value	23,279	23,279			$ 12,523
Assets and liabilities measured at fair value | Level 3
Liabilities
Total liabilities measured at fair value	7,507	7,507
Assets and liabilities measured at fair value | Level 3 | DTECH LABS, Inc.
Liabilities
Current contingent consideration to seller	5,000	5,000
Noncurrent contingent consideration to seller	$ 2,507	$ 2,507

ACCOUNTS RECEIVABLE (Details)

ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Sep. 30, 2014
Components of accounts receivable under long-term contracts
Total accounts receivable under long-term contracts	$ 383,101	$ 379,945
Less estimated amounts not currently due	(36,809)	(15,870)
Accounts receivable under long-term contracts, current	346,292	364,075
U.S. government contracts
Components of accounts receivable under long-term contracts
Amounts billed	55,656	41,588
Recoverable costs and accrued profits on progress completed--not billed	63,676	66,657
Total accounts receivable under long-term contracts	119,332	108,245
Commercial customers
Components of accounts receivable under long-term contracts
Amounts billed	71,808	80,283
Recoverable costs and accrued profits on progress completed--not billed	191,961	191,417
Total accounts receivable under long-term contracts	263,769	271,700
Less estimated amounts not currently due	$ (36,809)	$ (15,870)

INVENTORIES (Details)

INVENTORIES (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Sep. 30, 2014
INVENTORIES
Finished products	$ 644
Work in process and inventoried costs under long-term contracts	66,293	$ 58,440
Materials and purchased parts	2,733	125
Customer advances	(5,970)	(19,790)
Net inventories	63,700	38,775
Costs incurred outside the scope of work or in advance of a contract award	1,900	2,300
General and administrative amounts for certain government contracts remaining in inventory	$ 1,800	$ 2,400

PROPERTY, PLANT AND EQUIPMENT51

PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
PROPERTY, PLANT AND EQUIPMENT
Accumulated depreciation and amortization	$ (108,209)	$ (108,936)
Property, plant and equipment - net	74,690	64,149
Depreciation of plant and equipment and amortization of leasehold improvements	10,100	7,800	$ 8,700
Development expense	17,992	17,959	24,445
Amortization of intangible assets	27,550	22,602	$ 16,680
Land and land improvements
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, Gross	16,925	16,056
Buildings and improvements
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, Gross	48,637	49,347
Machinery and other equipment
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, Gross	65,948	71,360
Software
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, Gross	21,633	25,131
Addition to capitalized software expenses		5,000
Development expense	11,500
Amortization of intangible assets	1,000	400
Leasehold improvements
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, Gross	$ 11,737	$ 11,191
Leasehold improvements | Minimum
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, useful life	15 years
Leasehold improvements | Maximum
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, useful life	39 years
Machinery and equipment and software | Minimum
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, useful life	5 years
Machinery and equipment and software | Maximum
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, useful life	10 years
Construction and internal-use software development in progress
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, Gross	$ 18,019
Addition to capitalized software expenses	$ 16,000

GOODWILL AND PURCHASED INTANG52

GOODWILL AND PURCHASED INTANGIBLE ASSETS (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2015USD ($)item	Sep. 30, 2014USD ($)	Sep. 30, 2013USD ($)
Goodwill [Roll Forward]
Balance at the beginning of the period	$ 184,141	$ 136,094
Goodwill, Acquired During Period	57,875	48,157
Foreign currency exchange rate changes	(4,117)	(110)
Balance at the end of the period	237,899	184,141	$ 136,094
Impairment of goodwill	$ 0		50,865
Number of remaining reporting units whose estimated fair values exceeded carrying values | item	3
Transportation Systems
Goodwill [Roll Forward]
Balance at the beginning of the period	$ 59,167	18,301
Goodwill, Acquired During Period		40,792
Foreign currency exchange rate changes	(3,193)	74
Balance at the end of the period	$ 55,974	59,167	18,301
Transportation Systems | Minimum
Goodwill [Roll Forward]
Estimated percentage of excess of fair value over carrying value	20.00%
Cubic Global Defense Systems
Goodwill [Roll Forward]
Balance at the beginning of the period	$ 30,624	23,443
Goodwill, Acquired During Period	57,875	7,365
Foreign currency exchange rate changes	(924)	(184)
Balance at the end of the period	$ 87,575	30,624	23,443
Cubic Global Defense Systems | Minimum
Goodwill [Roll Forward]
Estimated percentage of excess of fair value over carrying value	20.00%
Cubic Global Defense Services
Goodwill [Roll Forward]
Balance at the beginning of the period	$ 94,350	94,350
Balance at the end of the period	$ 94,350	$ 94,350	$ 94,350
Decrease in future years' projected cash flows requiring additional analysis for goodwill impairment	12.00%
Cubic Global Defense Services | Minimum
Goodwill [Roll Forward]
Estimated percentage of excess of fair value over carrying value	10.00%

GOODWILL AND PURCHASED INTANG53

GOODWILL AND PURCHASED INTANGIBLE ASSETS (Details 2) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Purchased intangible assets
Amortization of intangible assets	$ 27,550	$ 22,602	$ 16,680
Gross Carrying Amount	185,016	148,702
Accumulated Amortization	(112,080)	(85,084)
Net Carrying Amount	72,936	63,618
Expected amortization for purchased intangibles for each of the next five years
2,016	21,552
2,017	16,348
2,018	12,999
2,019	8,516
2,020	4,626
Thereafter	8,895
Total expected amortization for purchased intangibles	72,936
Contract and program intangibles
Purchased intangible assets
Gross Carrying Amount	156,847	121,340
Accumulated Amortization	(96,916)	(73,234)
Net Carrying Amount	59,931	48,106
Other purchased intangibles
Purchased intangible assets
Gross Carrying Amount	28,169	27,362
Accumulated Amortization	(15,164)	(11,850)
Net Carrying Amount	13,005	$ 15,512
Transportation Systems
Expected amortization for purchased intangibles for each of the next five years
2,016	7,358
2,017	6,306
2,018	5,251
2,019	2,986
2,020	958
Thereafter	3,043
Total expected amortization for purchased intangibles	25,902
Cubic Global Defense Systems
Expected amortization for purchased intangibles for each of the next five years
2,016	9,480
2,017	7,590
2,018	5,973
2,019	4,346
2,020	2,878
Thereafter	1,514
Total expected amortization for purchased intangibles	31,781
Cubic Global Defense Services
Expected amortization for purchased intangibles for each of the next five years
2,016	4,714
2,017	2,452
2,018	1,775
2,019	1,184
2,020	790
Thereafter	4,338
Total expected amortization for purchased intangibles	$ 15,253

FINANCING ARRANGEMENTS (Details

FINANCING ARRANGEMENTS (Details) $ in Thousands, NZD in Millions, AUD in Millions	12 Months Ended
	Sep. 30, 2015USD ($)	Sep. 30, 2014USD ($)	Sep. 30, 2013USD ($)	Sep. 30, 2015NZD	Sep. 30, 2015AUD	Sep. 30, 2015USD ($)	Jul. 17, 2015USD ($)	Mar. 31, 2013USD ($)
Financial arrangement
Long-term debt		$ 102,390				$ 126,705
Less current portion		(563)				(525)
Long-term Debt, Excluding Current Maturities		101,827				126,180
Maturities of long-term debt
2,016						500
2,017						500
2,018						500
2,019						100
2,020						0
Amount of interest paid	$ 4,800	4,100	$ 3,700
Amount of interest paid in connection with legal settlement			$ 600
Restricted cash		69,056				69,245
Self-insurance liabilities		9,100				8,800
Letters of credit primarily for self-insured liabilities
Maturities of long-term debt
Letters of Credit and bank guarantees outstanding						16,100
Fair value of instruments						0
Letters of credit and bank guarantees
Maturities of long-term debt
Letters of Credit and bank guarantees outstanding						76,000
New Zealand
Short term borrowings
Maximum borrowing capacity under credit agreement				NZD 0.5		300
Borrowings outstanding		0
Australia
Short term borrowings
Maximum borrowing capacity under credit agreement					AUD 3	$ 2,100
Borrowings outstanding		0
Senior unsecured notes
Financial arrangement
Interest rate (as a percent)							3.70%	3.35%
Maturities of long-term debt
Principal amount of debt instrument							$ 25,000	$ 100,000
Series A senior unsecured notes
Financial arrangement
Interest rate (as a percent)				3.35%	3.35%	3.35%
Long-term debt		50,000				$ 50,000
Series B senior unsecured notes
Financial arrangement
Interest rate (as a percent)				3.35%	3.35%	3.35%
Long-term debt		50,000				$ 50,000
Series C senior unsecured notes
Financial arrangement
Interest rate (as a percent)				3.70%	3.70%	3.70%
Long-term debt						$ 25,000
Mortgage notes | United Kingdom
Financial arrangement
Interest rate (as a percent)				6.48%	6.48%	6.48%
Long-term debt		$ 2,390				$ 1,705
Revolving credit agreement
Maturities of long-term debt
Term under revolving credit or letter of agreement	5 years
Letters of credit outstanding						21,800
Available amount under line of credit						$ 118,200
Weighted average interest rate on outstanding borrowings				1.70%	1.70%	1.70%
Short term borrowings
Maximum borrowing capacity under credit agreement						$ 200,000
Borrowings outstanding						60,000
Secured letter of credit agreement
Maturities of long-term debt
Letters of credit outstanding						58,500
Short term borrowings
Maximum borrowing capacity under credit agreement						62,800
Secured letter of credit agreement | United Kingdom
Maturities of long-term debt
Cash on deposit as collateral						$ 69,200

COMMITMENTS (Details)

COMMITMENTS (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Commitments
Sublease income	$ 300	$ 200	$ 200
Rental expense, net of sublease income	11,900	$ 12,000	$ 12,600
Future minimum payments, net of minimum sublease income, under noncancelable operating leases
2,016	10,766
2,017	9,335
2,018	8,302
2,019	6,463
2,020	4,771
Thereafter	15,415
Total future minimum payments, net of minimum sublease income	$ 55,052
Maximum
Commitments
Term of lease	10 years

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Components of income (loss) before income taxes
United States	$ (18,712)	$ (22,788)	$ (31,640)
Foreign	90,623	112,199	71,411
Income before income taxes	71,911	89,411	39,771
Current:
Federal	(2,433)	(8,049)	8,198
State	723	918	2,437
Foreign	20,266	25,705	18,581
Total current	18,556	18,574	29,216
Deferred:
Federal	24,112	1,296	(14,182)
State	5,710	(1,232)	(2,720)
Foreign	619	1,193	2,188
Total deferred	30,441	1,257	(14,714)
Provision for income taxes	$ 48,997	$ 19,831	$ 14,502

INCOME TAXES (Details 2)

INCOME TAXES (Details 2) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Reclassification
Retirement benefits	$ 8,040	$ 4,729
Allowances for loss contingencies	3,793	5,121
Deferred tax assets:
Accrued employee benefits	12,597	13,944
Long-term contracts and inventory valuation reductions	13,297	9,554
Allowances for loss contingencies	3,793	5,121
Deferred compensation	4,252	4,310
Property, plant and equipment	1,611	1,507
Intangible assets	8,037	2,324
Retirement benefits	8,040	4,729
Tax credit carryforwards	11,151	7,285
Net operating losses carryforwards	14,795	15,662
Other	867	585
Total gross deferred tax assets	78,440	65,021
Valuation allowance	(54,759)	(14,024)
Total deferred tax assets	23,681	50,997
Deferred tax liabilities:
Deferred revenue	(23,981)	(22,507)
Other	(2,248)	(1,943)
Total deferred tax liabilities	(26,229)	(24,450)
Net deferred tax asset		26,547
Net deferred tax liabilities	(2,548)
Unused state tax credits	15,800
Valuation allowance expense	37,600
Deferred tax asset valuation allowance	54,759	$ 14,024
Foreign subsidiaries earnings on which income tax not provided	$ 426,600
Period of cumulative income or loss under assessment to determine if a valuation allowance is required	3 years
Period of historical cumulative loss	3 years
United Kingdom
Deferred tax liabilities:
Foreign subsidiaries earnings on which income tax not provided	$ 394,900
Foreign
Deferred tax liabilities:
Net operating loss carryforwards	47,400
Valuation allowance expense	1,800
U.S.
Deferred tax liabilities:
Valuation allowance expense	35,800
State
Deferred tax liabilities:
Net operating loss carryforwards	$ 33,300

INCOME TAXES (Details 3)

INCOME TAXES (Details 3) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Reconciliation of income tax computed at the U.S. federal statutory tax rate to income tax expense
Tax expense at U.S. statutory rate	$ 25,169	$ 31,294	$ 13,920
State income taxes, net of federal tax effect	(34)	111	120
Nondeductible expenses	1,555	1,319	1,609
Change in reserve for tax contingencies	(1,192)	(601)	(673)
Impact of goodwill impairment loss			10,046
Change in deferred tax asset valuation allowance	38,284	3,109	5,161
Foreign earnings taxes at less than statutory rate	(11,924)	(12,783)	(7,521)
Tax credits generated in the current year	(1,696)	(2,772)	(4,319)
Reinstatement of federal research and development credit	(1,247)		(1,937)
Manufacturing deduction			(1,333)
Other	82	154	(571)
Provision for income taxes	48,997	19,831	14,502
Net changes in the liability for unrecognized tax benefits
Balance at the beginning of the period	7,306	8,441
Increase (decrease) related to tax positions in prior years:
Recognition of benefits from expiration of statutes	(1,068)	(973)
Settlements with taxing authorities		(728)
Other	3,125	(54)
Tax positions related to the current year	472	743
Tax positions related to current year acquisitions	2,784
Currency translation adjustment		(123)
Balance at the end of the period	12,619	7,306	8,441
Unrecognized tax benefits from permanent tax adjustments that, if recognized, would affect the effective rate	4,500	4,700
Unrecognized tax benefits related to settlements with taxing authorities	3,700
Interest and penalties accrued	1,200	1,600
Total liability for uncertain tax issues	10,900	8,000
Cash amounts paid for income taxes, net of refunds received	$ 15,200	$ 27,300	$ 42,100

DERIVATIVE INSTRUMENTS AND HE59

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) - Foreign currency forwards - USD ($) $ in Thousands	Sep. 30, 2015	Sep. 30, 2014
Instruments designated as accounting hedges:
Derivative instruments and hedging activities
Notional principal outstanding derivative instruments	$ 217,796	$ 249,628
Instruments not designated as accounting hedges:
Derivative instruments and hedging activities
Notional principal outstanding derivative instruments	142,820	136,955
Not designated but designed to manage exposure:
Derivative instruments and hedging activities
Notional principal outstanding derivative instruments	$ 117,800	$ 132,100

DERIVATIVE INSTRUMENTS AND HE60

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 2) - Instruments designated as accounting hedges: - USD ($) $ in Thousands	Sep. 30, 2015	Sep. 30, 2014
Derivative instruments and hedging activities
Asset derivatives:	$ 25,230	$ 13,309
Liability derivatives:	23,279	12,523
Foreign currency forwards | Other current assets
Derivative instruments and hedging activities
Asset derivatives:	11,321	7,389
Foreign currency forwards | Other noncurrent assets
Derivative instruments and hedging activities
Asset derivatives:	13,909	5,920
Foreign currency forwards | Other current liabilities
Derivative instruments and hedging activities
Liability derivatives:	9,370	6,645
Foreign currency forwards | Other noncurrent liabilities
Derivative instruments and hedging activities
Liability derivatives:	$ 13,909	$ 5,878

DERIVATIVE INSTRUMENTS AND HE61

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 3) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Derivative instruments and hedging activities
Gains (losses) recognized in OCI	$ 1,165	$ 820
Gains (losses) reclassified into earnings - Effective Portion	1,257	330
Gain (losses) recognized - Ineffective Portion and Amount excluded from effectiveness testing	144	164
Estimated unrealized net gains from cash flow hedges which are expected to be reclassified into earnings in the next twelve months	1,300
Foreign currency forwards | Other income/(expense), net
Derivative instruments and hedging activities
Gains (losses) recognized in OCI	1,165	820
Gains (losses) reclassified into earnings - Effective Portion	1,257	330
Gain (losses) recognized - Ineffective Portion and Amount excluded from effectiveness testing	$ 144
Forward starting swap | Other income/(expense), net
Derivative instruments and hedging activities
Gain (losses) recognized - Ineffective Portion and Amount excluded from effectiveness testing		$ 164

DERIVATIVE INSTRUMENTS AND HE62

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 4)	Sep. 30, 2015USD ($)
Foreign currency forwards | Minimum
Derivative instruments and hedging activities
Minimum commitment amount for hedging	$ 50,000

PENSION, PROFIT SHARING AND O63

PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2015USD ($)item	Sep. 30, 2014USD ($)item	Sep. 30, 2013USD ($)item	Sep. 30, 2010
Defined Contribution Plans
Minimum discretionary contribution with Board of Directors | item	0.5	0.5	0.5
Company contributions to defined contribution plan	$ 14,200	$ 19,600	$ 19,700
Amounts recognized in Accumulated OCI
Valuation allowance on deffered tax asset	$ (54,759)	(14,024)
Equity securities
Weighted-average assumptions used to determine net periodic benefit cost at the end of the year
Target allocation percentage, minimum	20.00%
Target allocation percentage, maximum	55.00%
Debt securities
Weighted-average assumptions used to determine net periodic benefit cost at the end of the year
Target allocation percentage, minimum	25.00%
Target allocation percentage, maximum	75.00%
Cash
Weighted-average assumptions used to determine net periodic benefit cost at the end of the year
Target allocation percentage, minimum	0.00%
Target allocation percentage, maximum	55.00%
Real Estate
Change in plan assets:
Fair value of plan assets at the beginning of the year	$ 7,096
Fair value of plan assets at the end of the year	$ 8,166	7,096
Weighted-average assumptions used to determine net periodic benefit cost at the end of the year
Target allocation percentage, minimum	0.00%
Target allocation percentage, maximum	10.00%
Defined Benefit Pension Plans
Defined Benefit Pension Plans
Number of European employees covered by contributory defined benefit pension plan for which benefits were frozen (as a percent)				50.00%
Decrease in benefit obligation as a result of plan amendments		1,700
Expected contribution to defined benefit pension plans in next fiscal year	$ 5,100
Unrecognized actuarial loss expected to be recognized in net pension cost over next fiscal year	2,000
Deferred compensation plans
Unrecognized actuarial loss expected to be recognized in net pension cost over next fiscal year, net of tax	1,500
Plan assets expected to be returned in 2016	0
Projected benefit obligation, ABO and fair value of plan assets for the defined benefit pension plans in which the ABO was in excess of the fair value of plan assets
Projected benefit obligation	227,527	224,201
Accumulated benefit obligation	227,527	224,201
Fair value of plan assets	201,502	206,982
Change in benefit obligations:
Net benefit obligation at the beginning of the year	224,201	209,118
Service cost	670	636	532
Interest cost	9,073	9,967	8,867
Actuarial loss (gain)	8,203	10,730
Plan amendments		(1,044)
Gross benefits paid	(7,047)	(6,229)
Foreign currency exchange rate changes	(7,573)	1,023
Net benefit obligation at the end of the year	227,527	224,201	209,118
Change in plan assets:
Fair value of plan assets at the beginning of the year	206,982	188,337
Actual return on plan assets	2,815	21,127
Employer contributions	6,206	3,728
Gross benefits paid	(7,047)	(6,229)
Administrative expenses	(682)	(730)
Foreign currency exchange rate changes	(6,772)	749
Fair value of plan assets at the end of the year	201,502	206,982	188,337
Unfunded status of the plans	(26,025)	(17,219)
Unrecognized net actuarial loss	51,087	33,376
Net amount recognized	25,062	16,157
Amounts recognized in Accumulated OCI
Liability adjustment to OCI	(51,087)	(33,376)
Deferred tax asset	15,260	9,925
Valuation allowance on deffered tax asset	(3,415)
Accumulated other comprehensive loss	(39,242)	(23,451)
Components of net periodic pension cost (benefit)
Service cost	670	636	532
Interest cost	9,073	9,967	8,867
Expected return on plan assets	(13,835)	(13,183)	(11,605)
Amortization of actuarial loss	705	802	1,798
Administrative expenses	163	152	76
Net pension benefit	$ (3,224)	$ (1,626)	$ (332)
Weighted-average assumptions used to determine benefit obligation at the end of the year
Discount rate (as a percent)	4.10%	4.20%	4.80%
Rate of compensation increase (as a percent)	3.10%	3.20%	4.40%
Weighted-average assumptions used to determine net periodic benefit cost at the end of the year
Discount rate (as a percent)	4.20%	4.80%	4.30%
Expected return on plan assets (as a percent)	6.90%	7.00%	7.00%
Rate of compensation increase (as a percent)	3.20%	4.40%	3.80%
Non-qualified deferred compensation plan
Deferred compensation plans
Liabilities associated with the non-qualified deferred compensation plan	$ 9,900	$ 9,500
Assets set aside to fund deferred compensation liabilities	2,900
Non-qualified deferred compensation plan | Life insurance contracts
Deferred compensation plans
Assets set aside to fund deferred compensation liabilities	1,900
Non-qualified deferred compensation plan | Marketable securities
Deferred compensation plans
Assets set aside to fund deferred compensation liabilities	$ 1,000

PENSION, PROFIT SHARING AND O64

PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS (Details 2) - USD ($) $ in Thousands	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Cash and cash equivalents
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	$ 1,754	$ 2,270
Cash and cash equivalents | Level 1
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	766	1,863
Cash and cash equivalents | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	988	407
Equity securities | United States
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	38,912	43,351
Equity securities | United States | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	38,912	43,351
Equity securities | Other foreign countries
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	45,120	47,110
Equity securities | Other foreign countries | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	45,120	47,110
Fixed-income funds | United States
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	49,744	49,479
Fixed-income funds | United States | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	49,744	49,479
Fixed-income funds | United Kingdom
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	24,707	25,813
Fixed-income funds | United Kingdom | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	24,707	25,813
Diversified growth fund
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	33,099	31,863
Diversified growth fund | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	33,099	31,863
Real Estate
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	8,166	7,096
Real Estate | Level 3
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	8,166	7,096
Defined Benefit Pension Plans
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	201,502	206,982	$ 188,337
Defined Benefit Pension Plans | Level 1
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	766	1,863
Defined Benefit Pension Plans | Level 2
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	192,570	198,023
Defined Benefit Pension Plans | Level 3
Fair value of assets of defined benefit pension plans by asset category
Fair value of the assets	$ 8,166	$ 7,096	$ 6,263

PENSION, PROFIT SHARING AND O65

PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS (Details 3) - Defined Benefit Pension Plans - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Changes in the fair value of plan assets categorized as Level 3
Fair value of plan assets at the beginning of the year	$ 206,982	$ 188,337
Realized and unrealized gains, net	2,815	21,127
Fair value of plan assets at the end of the year	201,502	206,982
Level 3
Changes in the fair value of plan assets categorized as Level 3
Fair value of plan assets at the beginning of the year	7,096	6,263
Realized and unrealized gains, net	1,142	898
Purchase, sales and settlements, net	(72)	(65)
Fair value of plan assets at the end of the year	$ 8,166	$ 7,096

PENSION, PROFIT SHARING AND O66

PENSION, PROFIT SHARING AND OTHER BENEFIT PLANS (Details 4) $ in Thousands	Sep. 30, 2015USD ($)
Expected pension benefit payments
2,016	$ 8,173
2,017	8,431
2,018	8,925
2,019	9,575
2,020	9,931
2021-2025	$ 53,898

STOCKHOLDERS' EQUITY (Details)

STOCKHOLDERS' EQUITY (Details)	Mar. 21, 2013shares	Sep. 30, 2015categoryitemshares	Sep. 30, 2014shares
Stockholders' Equity
Vesting period		3 years
RSUs
Stockholders' Equity
Number of units awarded (in shares)		322,428	305,074
Number of shares of common stock that each award holder has the contingent right to receive		1
Total number of awards granted (in shares)		1,054,013
Total number of awards vested (in shares)		230,110
Total number of unvested awards ultimately expected to vest (in shares)		287,568
Awards vested (in shares)		160,499	69,994
Time-based RSUs
Stockholders' Equity
Number of units awarded (in shares)	565,409
Number of equal installments for vesting of stock awards | item		4
Performance-based RSUs
Stockholders' Equity
Number of units awarded (in shares)	488,604
Vesting period		3 years
Number of vesting criteria which have to be satisfied out of total vesting criteria | category		1
Number of vesting criteria | category		3

STOCKHOLDERS' EQUITY (Details 2

STOCKHOLDERS' EQUITY (Details 2) - RSUs - $ / shares	Oct. 01, 2015	Sep. 30, 2015	Sep. 30, 2014
Number of Shares
Balance unvested at the beginning of the period (in shares)	759,902	642,949	421,369
Granted (in shares)		322,428	305,074
Vested (in shares)		(160,499)	(69,994)
Forfeited (in shares)		(44,976)	(13,500)
Balance unvested at the end of the period (in shares)		759,902	642,949
Weighted Average Grant-Date Fair Value
Balance unvested at the beginning of the period (in dollars per share)	$ 47.24	$ 43.76	$ 43.76
Granted (in dollars per share)		48.10	49.57
Vested (in dollars per share)		45.91	43.76
Forfeited (in dollars per share)		46.65	47.80
Balance unvested at the end of the period (in dollars per share)		$ 47.24	$ 43.76
Shares available for future grants		3,558,058
Subsequent event
Number of Shares
Vested (in shares)	(116,178)

STOCK-BASED COMPENSATION (Detai

STOCK-BASED COMPENSATION (Details) $ in Thousands	12 Months Ended
	Sep. 30, 2015USD ($)
Stock-Based Compensation
Non-cash compensation expense related to stock-based awards	$ 8,325
Estimated forfeiture rate (as a percent)	12.50%
RSUs
Stock-Based Compensation
Unrecognized compensation cost related to unvested awards	$ 25,400
Aggregate fair value of awards	$ 13,800
Weighted-average period of recognition	1 year 8 months 12 days
RSUs | Cost of sales
Stock-Based Compensation
Non-cash compensation expense related to stock-based awards	$ 754
RSUs | Selling, general and administrative
Stock-Based Compensation
Non-cash compensation expense related to stock-based awards	$ 7,571

LEGAL MATTERS (Details)

LEGAL MATTERS (Details) $ in Millions	1 Months Ended	4 Months Ended	12 Months Ended
	Jan. 31, 2015USD ($)	Jan. 31, 2014item	Sep. 30, 2015USD ($)
Lawsuit filed in federal court against the transit customers alleging breach of contract
Legal Matters
Number of transit customers included as defendants in lawsuit | item		1
Claim for the reimbursement of expenses incurred for a proposal prepared for a prospective customer of transportation systems business
Legal Matters
Litigation settlement	$ 3.6
Customer claims
Legal Matters
Insurance proceeds			$ 1.1

BUSINESS SEGMENT INFORMATION (D

BUSINESS SEGMENT INFORMATION (Details) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2015USD ($)	Jun. 30, 2015USD ($)	Mar. 31, 2015USD ($)	Dec. 31, 2014USD ($)	Sep. 30, 2014USD ($)	Jun. 30, 2014USD ($)	Mar. 31, 2014USD ($)	Dec. 31, 2013USD ($)	Sep. 30, 2015USD ($)segment	Sep. 30, 2014USD ($)	Sep. 30, 2013USD ($)
BUSINESS SEGMENT INFORMATION
Number of primary business segments | segment									3
Revenue recognition
Sales	$ 425,917	$ 347,806	$ 338,834	$ 318,488	$ 396,366	$ 340,357	$ 354,492	$ 307,137	$ 1,431,045	$ 1,398,352	$ 1,361,407
Operating income (loss)	34,709	$ 10,293	$ 23,206	$ 7,179	39,268	$ 19,215	$ 22,177	$ 11,830	75,387	92,490	40,735
Assets	1,300,276				1,194,606				1,300,276	1,194,606	1,108,400
Depreciation and amortization									37,662	30,440	25,359
Capital expenditures									22,202	16,620	9,052
Transportation Systems
Revenue recognition
Sales									566,800	599,700	529,500
Operating income (loss)									75,900	65,900	66,800
Assets	410,000				422,200				410,000	422,200	369,800
Depreciation and amortization									10,800	11,500	5,000
Capital expenditures									2,000	1,800	2,800
Sales to Transport for London									183,200	213,200	193,400
Cubic Global Defense Services
Revenue recognition
Sales									402,100	398,100	468,700
Operating income (loss)									6,600	7,800	(36,100)
Assets	200,700				195,800				200,700	195,800	205,200
Depreciation and amortization									8,500	10,700	13,000
Capital expenditures											300
Cubic Global Defense Systems
Revenue recognition
Sales									462,100	400,600	363,000
Operating income (loss)									18,400	26,800	14,200
Assets	341,200				252,400				341,200	252,400	228,900
Depreciation and amortization									17,100	7,400	6,100
Capital expenditures									600	13,200	4,600
Other
Revenue recognition
Sales											200
Corporate and other
Revenue recognition
Assets	$ 348,400				$ 324,200				348,400	324,200	304,500
Depreciation and amortization									1,300	800	1,300
Capital expenditures									19,600	1,600	1,400
CGD services and CGD systems segments
Revenue recognition
Sales to U.S. government agencies									670,000	651,500	691,800
Unallocated corporate expenses and other
Revenue recognition
Operating income (loss)									$ (25,500)	$ (8,000)	$ (4,200)

BUSINESS SEGMENT INFORMATION 72

BUSINESS SEGMENT INFORMATION (Details 2) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Business segment financial data
Sales	$ 425,917	$ 347,806	$ 338,834	$ 318,488	$ 396,366	$ 340,357	$ 354,492	$ 307,137	$ 1,431,045	$ 1,398,352	$ 1,361,407
Long-lived assets, net	78,700				65,400				78,700	65,400	59,700
United States
Business segment financial data
Sales									765,000	749,900	741,700
Long-lived assets, net	65,800				49,800				65,800	49,800	43,900
United Kingdom
Business segment financial data
Sales									282,400	294,400	267,400
Long-lived assets, net	8,600				9,300				8,600	9,300	9,200
Canada
Business segment financial data
Sales									17,600	9,000	30,400
Australia
Business segment financial data
Sales									164,600	161,900	148,500
Middle East
Business segment financial data
Sales									67,700	42,000	35,400
Far East
Business segment financial data
Sales									55,300	76,600	78,200
Other foreign countries
Business segment financial data
Sales									78,400	64,600	59,800
Long-lived assets, net	$ 4,300				$ 6,300				$ 4,300	$ 6,300	$ 6,600

BUSINESS SEGMENT INFORMATION 73

BUSINESS SEGMENT INFORMATION (Details 3) $ / shares in Units, $ in Thousands	1 Months Ended		3 Months Ended									12 Months Ended
	Aug. 31, 2015USD ($)	Sep. 30, 2014USD ($)item	Sep. 30, 2015USD ($)$ / shares	Jun. 30, 2015USD ($)$ / shares	Mar. 31, 2015USD ($)$ / shares	Dec. 31, 2014USD ($)$ / shares	Sep. 30, 2014USD ($)$ / shares	Jun. 30, 2014USD ($)$ / shares	Mar. 31, 2014USD ($)$ / shares	Dec. 31, 2013USD ($)$ / shares	Mar. 31, 2013USD ($)	Sep. 30, 2015USD ($)item$ / shares	Sep. 30, 2014USD ($)$ / shares	Sep. 30, 2013USD ($)item$ / shares
Revenue recognition
Increase (decrease) in operating income			$ 34,709	$ 10,293	$ 23,206	$ 7,179	$ 39,268	$ 19,215	$ 22,177	$ 11,830		$ 75,387	$ 92,490	$ 40,735
Increase (decrease) in net income												$ 22,914	$ 69,580	$ 25,269
Increase (decrease) in net income per common share (in dollars per share) | $ / shares			$ 0.74	$ 0.33	$ (0.41)	$ 0.19	$ 1.22	$ 0.46	$ 0.60	$ 0.31		$ 0.85	$ 2.59	$ 0.94
Number of transportation systems service contracts contains annual system usage incentives | item												1
Sales related to annual system usage incentives	$ 3,100				$ 9,300				$ 12,200		$ 13,200
Restructuring costs												$ 6,272	$ 1,094	$ 8,139
Transportation Systems
Revenue recognition
Increase (decrease) in operating income												75,900	65,900	66,800
Reduction in employee headcount | item		20
Restructuring costs		$ 1,100										600
Cubic Global Defense Systems
Revenue recognition
Increase (decrease) in operating income												18,400	26,800	$ 14,200
Reduction in employee headcount | item														230
Restructuring costs												4,600		$ 8,100
Cubic Global Defense Services
Revenue recognition
Increase (decrease) in operating income												6,600	7,800	(36,100)
Restructuring costs												600
Unallocated corporate expenses and other
Revenue recognition
Increase (decrease) in operating income												(25,500)	(8,000)	(4,200)
Restructuring costs												500
Change in estimated total costs | Adjustment
Revenue recognition
Increase (decrease) in operating income			$ 700				$ 10,700					(14,500)	1,300	(1,700)
Increase (decrease) in net income			$ 500				$ 7,600					$ (8,000)	$ 3,500	$ (300)
Increase (decrease) in net income per common share (in dollars per share) | $ / shares			$ 0.02				$ 0.28					$ (0.30)	$ 0.13	$ (0.01)

BUSINESS SEGMENT INFORMATION 74

BUSINESS SEGMENT INFORMATION (Details 4) $ in Thousands	12 Months Ended
	Sep. 30, 2015USD ($)	Sep. 30, 2014USD ($)	Sep. 30, 2013USD ($)item
Restructuring liability
Liability at the beginning of the period	$ 776	$ 2,220
Accrued costs	6,272	1,094	$ 8,139
Cash payments	(5,155)	(2,538)
Liability at the end of the period	1,893	$ 776	$ 2,220
Cubic Global Defense Systems
Restructuring plan
Reduction in employee headcount | item			230
Restructuring liability
Accrued costs	$ 4,600		$ 8,100

SUMMARY OF QUARTERLY RESULTS 75

SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
Net sales	$ 425,917	$ 347,806	$ 338,834	$ 318,488	$ 396,366	$ 340,357	$ 354,492	$ 307,137	$ 1,431,045	$ 1,398,352	$ 1,361,407
Operating income (loss)	34,709	10,293	23,206	7,179	39,268	19,215	22,177	11,830	75,387	92,490	40,735
Net income attributable to Cubic	$ 19,977	$ 8,780	$ (11,024)	$ 5,152	$ 32,805	$ 12,206	$ 16,092	$ 8,388	$ 22,885	$ 69,491	$ 25,086
Net income (loss) per share, basic (in dollars per share)	$ 0.74	$ 0.33	$ (0.41)	$ 0.19	$ 1.22	$ 0.46	$ 0.60	$ 0.31	$ 0.85	$ 2.59	$ 0.94
Net income (loss) per share, diluted (in dollars per share)	$ 0.74	$ 0.33	$ (0.41)	$ 0.19	$ 1.22	$ 0.45	$ 0.60	$ 0.31	$ 0.85	$ 2.59	$ 0.94
Goodwill impairment charge related to MSS reporting unit									$ 0		$ 50,865

SUMMARY OF QUARTERLY RESULTS 76

SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Details 2) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Summary Of quarterly results of operations
Increase (decrease) in operating income	$ 34,709	$ 10,293	$ 23,206	$ 7,179	$ 39,268	$ 19,215	$ 22,177	$ 11,830	$ 75,387	$ 92,490	$ 40,735
Increase (decrease) in net income									$ 22,914	$ 69,580	$ 25,269
Increase (decrease) in net income per common share (in dollars per share)	$ 0.74	$ 0.33	$ (0.41)	$ 0.19	$ 1.22	$ 0.46	$ 0.60	$ 0.31	$ 0.85	$ 2.59	$ 0.94
Change in estimated total costs | Adjustment
Summary Of quarterly results of operations
Increase (decrease) in operating income	$ 700				$ 10,700				$ (14,500)	$ 1,300	$ (1,700)
Increase (decrease) in net income	$ 500				$ 7,600				$ (8,000)	$ 3,500	$ (300)
Increase (decrease) in net income per common share (in dollars per share)	$ 0.02				$ 0.28				$ (0.30)	$ 0.13	$ (0.01)