ManpowerGroup 2014 Annual Report Download - page 64

Download and view the complete annual report

Please find page 64 of the 2014 ManpowerGroup annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 98

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98

62
Notes to Consolidated Financial Statements
Capitalized Software for Internal Use
We capitalize purchased software as well as internally developed software. Internal software development costs are
capitalized from the time the internal use software is considered probable of completion until the software is ready for use.
Business analysis, system evaluation, selection and software maintenance costs are expensed as incurred. Capitalized
software costs are amortized using the straight-line method over the estimated useful life of the software which ranges from
3 to 10 years. The net capitalized software balance of $5.3 and $4.6 as of December 31, 2014 and 2013, respectively, is
included in other assets in the Consolidated Balance Sheets. Amortization expense related to the capitalized software
costs was $2.2, $5.6 and $7.3 for 2014, 2013 and 2012, respectively.
Property and Equipment
A summary of property and equipment as of December 31 is as follows:
2014 2013
Land $ 5.7 $ 6.2
Buildings 19.2 20.8
Furniture, fixtures, and autos 178.2 194.1
Computer equipment 153.0 168.1
Leasehold improvements 277.4 317.0
Property and equipment $ 633.5 $ 706.2
Property and equipment are stated at cost and are depreciated using primarily the straight-line method over the following
estimated useful lives: buildings — up to 40 years; furniture, fixtures, autos and computer equipment — 2 to 15 years;
leasehold improvements — lesser of life of asset or expected lease term. Expenditures for renewals and betterments are
capitalized whereas expenditures for repairs and maintenance are charged to income as incurred. Upon sale or disposition
of property and equipment, the difference between the unamortized cost and the proceeds is recorded as either a gain or
a loss and is included in our Consolidated Statements of Operations. Long-lived assets are evaluated for impairment in
accordance with the provisions of the accounting guidance on the impairment or disposal of long-lived assets.
Derivative Financial Instruments
We account for our derivative instruments in accordance with the accounting guidance on derivative instruments and
hedging activities. Derivative instruments are recorded on the balance sheet as either an asset or liability measured at their
fair value. If the derivative is designated as a fair value hedge, the changes in the fair value of the derivative and of the
hedged item attributable to the hedged risk are recognized in earnings. If the derivative is designated as a cash flow hedge,
the effective portions of the changes in the fair value of the derivative are recorded as a component of accumulated other
comprehensive (loss) income and recognized in the Consolidated Statements of Operations when the hedged item affects
earnings. The ineffective portions of the changes in the fair value of cash flow hedges are recognized in earnings.
Foreign Currency Translation
The financial statements of our non-United States subsidiaries have been translated in accordance with the accounting
guidance on foreign currency translation. Under the accounting guidance, asset and liability accounts are translated at the
current exchange rate and income statement items are translated at the weighted-average exchange rate for the year. The
resulting translation adjustments are recorded as a component of accumulated other comprehensive (loss) income, which
is included in shareholders’ equity.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
in millions, except share and per share data