Cash America 2014 Annual Report Download - page 128

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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
113
The aggregate change in the balance of the unrecognized tax benefits for the years ended December 31,
2014, 2013 and 2012 is summarized below (dollars in thousands):
2014 2013 2012
Balance at January 1, $
—
$1,021 $955
Decrease due to lapse of statute of limitations
—
(1,021
)
—
Effect of change in foreign currency rates
—
—
66
Balance at December 31, $
—
$
—
$1,021
During 2013, the statute of limitations expired related to the Mexico tax returns of Creazione for periods
before it was acquired by the Company (pre-2008). As a result, the Company released reserves established for
unrecognized tax benefits of $1.0 million and the related accrued interest and penalties of $1.9 million. Consistent
with the Company’s accounting policy, the release of the $1.0 million was recorded in the tax provision. The release
of the $1.9 million of reserves related to interest and penalties was recorded through a reduction of interest and
administrative expenses.
The liability for unrecognized tax benefits, including related interest and penalties, is classified as a
noncurrent liability in the consolidated balance sheets. The Company had no amounts accrued as of December 31,
2014 and December 31, 2013, respectively.
As of December 31, 2014, the Company’s 2011 through 2013 tax years were open to examination by the
Internal Revenue Service and major state taxing jurisdictions, and the 2009 through 2013 tax years of the
Company’s former Mexican subsidiaries were open to examination by the Mexican taxing authorities.
13. Commitments and Contingencies
Leases
The Company leases certain of its facilities under operating leases with terms generally from one to 10
years and certain rights to extend for additional periods. Future minimum rentals due under non-cancelable leases
are as follows for each of the years ending December 31 (dollars in thousands):
2015 2016 2017 2018 2019 Thereafter Total
Future minimum rentals due
under non-cancelable leases 55,881 47,605 37,407 29,533
22,172
40,811
$
233,409
Rent expense was $61.8 million, $58.1 million and $53.1 million for the years ended December 31, 2014,
2013 and 2012, respectively.
Guarantees
In connection with its CSO programs, the Company guarantees consumer loan payment obligations to
unrelated third-party lenders and is required to purchase any defaulted loans it has guaranteed. The guarantee
represents an obligation to purchase specific loans that go into default. Short-term loans that are guaranteed
generally have terms of less than 90 days. Unsecured installment loans that are guaranteed generally have terms of
two to 12 months. Installment loans secured by the customer’s vehicle that are guaranteed typically have terms of
up to 60 months. As of December 31, 2014 and 2013, the amount of consumer loans guaranteed by the Company
was $9.8 million and $17.5 million, respectively, representing amounts due under consumer loans originated by
third-party lenders under the CSO programs. The estimated fair value of the liability related to these guarantees of
$1.1 million and $1.0 million as of December 31, 2014 and 2013, respectively, is included in “Accounts payable and
accrued expenses” in the consolidated balance sheets.