Green Dot 2015 Annual Report Download - page 73

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Note 2—Summary of Significant Accounting Policies (continued)
We may also be required to serve as a “source of strength” to Green Dot Bank if it becomes less than adequately
capitalized.
Recent Accounting Pronouncements
In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Recognition and Measurement of
Financial Assets and Financial Liabilities (Topic 825) ("ASU 2016-01"). ASU 2016-01 revises the classification and
measurement of investments in certain equity investments and the presentation of certain fair value changes for certain
financial liabilities measured at fair value. ASU 2016-01 requires the change in fair value of many equity investments
to be recognized in net income. The standard is effective for interim and annual periods beginning after December
15, 2017, with early adoption permitted. The adoption of the ASU may result in a cumulative adjustment to retained
earnings as of the beginning of the year of adoption. We are currently evaluating the impact of the provisions of ASU
2016-01, however, we do not expect the adoption of the ASU to have a material impact on our consolidated financial
statements.
In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes ("ASU
2015-17"). ASU 2015-17 requires that deferred tax liabilities and assets be classified as noncurrent on the balance
sheet. The ASU is effective for interim and annual periods beginning after December 15, 2016, but early adoption is
permitted. We elected to early adopt this standard as of December 31, 2015 to simplify the presentation of our deferred
income taxes and applied the guidance retrospectively to all periods presented. This change resulted in a reclassification
of approximately $2.0 million in our net deferred tax assets and liabilities on our December 31, 2014 consolidated
balance sheet. We do not deem the early adoption of the ASU to have a material impact on our consolidated financial
statements for all periods presented.
In September 2015, the FASB issued ASU No. 2015-16, Business Combination (Topic 805): Simplifying the
Accounting for Measurement-Period Adjustments ("ASU 2015-16"). ASU 2015-16 requires adjustments to provisional
amounts that are identified during the measurement period to be recognized in the reporting period in which the
adjustment amounts are determined. This includes any effect on earnings from changes in depreciation, amortization,
or other income effects as a result of changes to provisional amounts calculated as if the accounting had been completed
at the acquisition date. In addition, the amendments in the ASU require an entity to disclose the nature and amount of
measurement-period adjustments recognized in the current period that would have been recorded in previous reporting
periods if the adjustments had been recognized as of the acquisition date. The amendments are effective for annual
and interim periods beginning after December 15, 2015, with early adoption permitted. We have elected to early adopt
the provisions of ASU 2015-16 as of December 31, 2015. The adoption of the ASU had no material impact on our
consolidated financial statements.
In April 2015, the FASB issued ASU No. 2015-05, Customer's Accounting for Fees Paid in a Cloud Computing
Arrangement ("ASU 2015-05"). This ASU provides guidance to customers about whether a cloud computing
arrangement includes a software license. If a cloud computing arrangement includes a software license, 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. The new guidance does not change the accounting for service contracts.
ASU 2015-05 is effective for interim and annual reporting periods beginning after December 15, 2015. The adoption
of the ASU is not expected to have a material impact on our consolidated financial statements.
In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs ("ASU
2015-03") which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an
entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an
asset. Amortization of the costs will continue to be reported as interest expense. The ASU is effective for annual
reporting periods beginning after December 15, 2015, with early adoption permitted. The new guidance will be applied
retrospectively to each prior period presented. We have elected to early adopt the provisions of ASU 2015-03 as of
December 31, 2015. The adoption of the ASU resulted in a reclassification of approximately $5.8 million and $7.4
million on our December 31, 2015 and 2014 consolidated balance sheets, respectively, between prepaid and other
assets and our total note payable outstanding. Of these amounts, approximately $1.5 million is netted against the
current portion of our note payable outstanding for all periods presented. The adoption of the ASU was not deemed
to have a material impact on our consolidated balance sheets.