Aarons 2015 Annual Report Download - page 65

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Accumulated Other Comprehensive Loss
Changes in accumulated other comprehensive loss by component for the year ended December 31, 2015 are as follows:
 

Balance at January 1, 2015 $ (90)
$ (90)
Other comprehensive loss (427)
(427)
Balance at December 31, 2015 $ (517)
$ (517)
There were no reclassifications out of accumulated other comprehensive loss for the year ended December 31, 2015.
Fair Value Measurement
Fair value is defined as 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. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to
measure fair value:
Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets.
Level 2—Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and
liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are
observable or can be corroborated by observable market data.
Level 3—Valuations based on unobservable inputs reflecting the Company's own assumptions, consistent with reasonably available
assumptions made by other market participants. These valuations require significant judgment.
The Company measures assets held for sale at fair value on a nonrecurring basis and records impairment charges when they are deemed to be impaired. The
Company maintains certain financial assets and liabilities, including investments and fixed-rate long term debt, that are not measured at fair value but for
which fair value is disclosed.
The fair values of the Company’s other current financial assets and liabilities, including cash and cash equivalents, accounts receivable and accounts
payable, approximate their carrying amounts due to their short-term nature. The fair value for the loans receivable and the revolving credit borrowings also
approximate their carrying amounts.
Foreign Currency
The financial statements of international subsidiaries are translated to U.S. dollars using month-end rates of exchange for assets and liabilities, and average
rates of exchange for revenues, costs and expenses. Translation gains and losses of international subsidiaries are recorded in accumulated other
comprehensive income as a component of shareholders’ equity.
Foreign currency transaction gains and losses are recorded as a component of other non-operating (expense) income, net in the consolidated statements of
earnings and amounted to losses of approximately $2.5 million, $2.3 million and $1.0 million during 2015, 2014, and 2013 respectively.
Recent Accounting Pronouncements
Revenue Recognition. In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09,
Revenue from Contracts with Customers. ASU 2014-09 replaces substantially all existing revenue recognition guidance with a single, comprehensive
revenue recognition model that requires a company to recognize revenue at the amount to which it expects to be entitled in exchange for transferring goods
or services to a customer. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising
from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.
In August 2015, the FASB issued ASU 2015-14, Deferral of the Effective Date, which deferred the effective date for ASU 2014-09 by one year to annual
reporting periods, and interim periods within that period, beginning after December 15, 2017. Companies may use either a full retrospective or a modified
retrospective approach to adopt ASU 2014-09. The Company has not yet determined the potential effects of adopting ASU 2014-09 on its consolidated
financial statements. The Company plans to complete its initial assessment of how it will be affected by this standard in the second half of 2016.
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