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Table of Contents
CDW CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
of 2017, allows for early adoption and must be applied prospectively after the date of adoption. This ASU is not expected to have a material impact on the
Company’s Consolidated Financial Statements.
Debt Issuance Costs
In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, amending
the presentation of debt issuance costs by requiring deferred financing costs related to a recognized debt liability to be presented in the balance sheet as a direct
deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for deferred financing costs are
not affected by the amendments in this ASU. This ASU is effective for the Company beginning in the first quarter of 2016, allows for early adoption permitted and
requires retrospective application to all prior periods.
The Company elected to early adopt ASU 2015-03 in the second quarter of 2015. As of June 30, 2015, the Company classified deferred financing costs as a direct
deduction from the carrying value of the long-term debt liability on the Consolidated Balance Sheets. Additionally, as of June 30, 2015, the Company retroactively
adjusted the deferred financing costs and long-term debt liability presented as of December 31, 2014 by reducing the long-term debt liability by the amount of the
deferred financing costs and eliminating the presentation of deferred financing costs as an asset on the Consolidated Balance Sheets.
In August 2015, the FASB issued ASU 2015-15, Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance
Costs Associated with Line-of-Credit Arrangements—Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting (SEC
Update), clarifying the SEC’s views on the presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. The ASU allows
for an entity to defer and present debt issuance costs associated with line-of-credit arrangements as an asset and subsequently amortize the deferred debt issuance
costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangements. This
ASU is effective upon issuance and the Company adopted it in the third quarter of 2015. As of September 30, 2015, the Company classified deferred financing costs
related to the Senior Secured Asset-Based Revolving Credit Facility as an asset, included within Other Assets on the Consolidated Balance Sheets. The Company
retroactively adjusted the deferred financing costs and long-term debt liability presented as of December 31, 2014 to align it to the presentation required by ASU
2015-15.
These adjustments had no impact on Net income, Comprehensive income, total Stockholders’ equity cash flows, or Adjusted EBITDA, a non-GAAP measure
defined in the Company’s credit agreement. The Company has determined the adjustments are not material either individually or in aggregate to any of its
previously issued Consolidated Financial Statements. A summary of the revisions to the Consolidated Balance Sheet at December 31, 2014 is as follows:
December 31, 2014
(in millions)
As Previously Reported
As Reported Upon Adoption of
ASU 2015-03 and ASU 2015-15
Deferred financing costs, net
$ 33.0
$ —
Other assets
$ 3.2
$ 12.2
Long-term debt
$ (3,174.6)
$ (3,150.6)
Revenue Recognition
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), replacing most existing revenue recognition guidance under
GAAP and eliminating industry specific guidance. The core principal of the new guidance is that an entity should recognize revenue for the transfer of goods and
services equal to an amount it expects to be entitled to receive for those goods and services. In August 2015, the FASB issued ASU 2015-14, Revenue from
Contracts with Customers (Topic 606): Deferral of the Effective Date, deferring the effective date by one year. This ASU will be effective for the Company
beginning in the first quarter of 2018, allows for early adoption in the first quarter of 2017 and may be applied using either a full retrospective approach or a
modified retrospective approach. The Company is currently evaluating the method of adoption and the impact this ASU will have on its Consolidated Financial
Statements.
3. Acquisition
On August 1, 2015 , the Company completed the acquisition of Kelway by purchasing the remaining 65% of its outstanding common stock which increased the
Company’s ownership interest from 35% to 100% , and provided the Company control.
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