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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2015

Total (gain) loss on foreign currency transactions for the three and six months ended June 30, 2014 and 2015 is as follows:



	Three Months Ended June 30,					Six Months Ended June 30,
	2014			2015		2014		2015
Total (gain) loss on foreign currency transactions	$	(4,347	)	$	1,656	$	2,091	$	23,922

Schedule of carrying value of goodwill, net for each of the reporting units

The carrying value of goodwill, net for each of our reporting units as of June 30, 2015 is as follows:



	Carrying Value as of June 30, 2015
North American Records and Information Management(1)(2)	$	1,389,683
North American Secure Shredding(1)(2)	40,884
North American Data Management(3)	373,698
Emerging Businesses(4)	3,036
UKI(1)(5)	272,226
Continental Western Europe(1)(5)	75,015
Emerging Markets - Eastern Europe(6)	81,772
Latin America(6)	95,445
Australia and Singapore(6)	52,836
Greater China(6)	3,525
India(6)	—
Russia, Ukraine and Denmark(6)	577
Total	$	2,388,697

_______________________________________________________________________________

(1)

We will finalize our preliminary estimates of fair value for these new reporting units once we finalize multi-year cash flow forecasts of such reporting units and conclude on the fair value of each new reporting unit based on the combined weighting of both fair value multiples and discounted cash flow techniques. To the extent final fair values of our new reporting units differ from our preliminary estimates, we will reassign goodwill amongst the new reporting units in a future period in which the final information is available to complete the fair values and the corresponding allocation of goodwill amongst the new reporting units.


(2)	This reporting unit is included in the North American Records and Information Management Business segment.


(3)	This reporting unit is included in the North American Data Management Business segment.


(4)	This reporting unit is included in the Corporate and Other Business segment.


(5)	This reporting unit is included in the Western European Business segment.


(6)	This reporting unit is included in the Other International Business segment.

The carrying value of goodwill, net for each of our reporting units as of December 31, 2014 was as follows:



	Carrying Value as of December 31, 2014
North American Records and Information Management(1)	$	1,397,484
Intellectual Property Management(1)	38,491
Fulfillment Services(1)	3,247
North American Data Management(2)	375,957
Emerging Businesses(3)	—
New Western Europe(4)	354,049
Emerging Markets - Eastern Europe(5)	87,408
Latin America(5)	107,240
Australia and Singapore(5)	55,779
Greater China(5)	3,500
India(5)	—
Russia, Ukraine and Denmark(5)	628
Total	$	2,423,783

_______________________________________________________________________________


(1)	This reporting unit is included in the North American Records and Information Management Business segment.


(2)	This reporting unit is included in the North American Data Management Business segment.


(3)	This reporting unit is included in the Corporate and Other Business segment.


(4)	This reporting unit is included in the Western European Business segment.


(5)	This reporting unit is included in the Other International Business segment.

Schedule of changes in the carrying value of goodwill attributable to each reportable operating segment

The changes in the carrying value of goodwill attributable to each reportable operating segment for the six months ended June 30, 2015 are as follows:



	North American Records and Information Management Business			North American Data Management Business			Western European Business			Other International Business			Corporate and Other Business		Total Consolidated
Gross Balance as of December 31, 2014	$	1,645,209		$	429,982		$	412,322		$	254,706		$	—	$	2,742,219
Deductible goodwill acquired during the year	1,638			409			—			—			3,036		5,083
Non-deductible goodwill acquired during the year	239			24			1,241			1,764			—		3,268
Fair value and other adjustments(1)	99			(25		)	(365		)	(1,111		)	—		(1,402		)
Currency effects	(11,163		)	(2,800		)	(9,155		)	(21,062		)	—		(44,180		)
Gross Balance as of June 30, 2015	$	1,636,022		$	427,590		$	404,043		$	234,297		$	3,036	$	2,704,988
Accumulated Amortization Balance as of December 31, 2014	$	205,987		$	54,025		$	58,273		$	151		$	—	$	318,436
Currency effects	(532		)	(133		)	(1,471		)	(9		)	—		(2,145		)
Accumulated Amortization Balance as of June 30, 2015	$	205,455		$	53,892		$	56,802		$	142		$	—	$	316,291
Net Balance as of December 31, 2014	$	1,439,222		$	375,957		$	354,049		$	254,555		$	—	$	2,423,783
Net Balance as of June 30, 2015	$	1,430,567		$	373,698		$	347,241		$	234,155		$	3,036	$	2,388,697
Accumulated Goodwill Impairment Balance as of December 31, 2014	$	85,909		$	—		$	46,500		$	—		$	—	$	132,409
Accumulated Goodwill Impairment Balance as of June 30, 2015	$	85,909		$	—		$	46,500		$	—		$	—	$	132,409

_______________________________________________________________________________


(1)	Total fair value and other adjustments primarily include $672 in net adjustments to deferred income taxes and $(5,680) related to customer relationships and acquisition costs and other assumed liabilities, as well as $3,606 of cash paid related to certain 2014 acquisitions.

Components of amortizable intangible assets

The components of our amortizable intangible assets as of December 31, 2014 and June 30, 2015 are as follows:



	December 31, 2014							June 30, 2015
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Customer Relationships and Acquisition Costs	$	904,866	$	(297,029	)	$	607,837	$	913,523	$	(318,055	)	$	595,468
Core Technology(1)	3,568		(3,540		)	28		3,414		(3,414		)	—
Trademarks and Non-Compete Agreements(1)	7,062		(5,068		)	1,994		6,908		(5,086		)	1,822
Deferred Financing Costs	63,033		(15,956		)	47,077		63,805		(19,978		)	43,827
Total	$	978,529	$	(321,593	)	$	656,936	$	987,650	$	(346,533	)	$	641,117

_______________________________________________________________________________


(1)	Included in Other, a component of Other Assets, net in the accompanying Consolidated Balance Sheets.

Schedule of amortization expenses

Amortization expense associated with amortizable intangible assets (including deferred financing costs) for the three and six months ended June 30, 2014 and 2015 is as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Amortization expense associated with amortizable intangible assets (including deferred financing costs)	$	14,332	$	13,593	$	27,958	$	26,845

Stock-based compensation expense for Employee Stock-Based Awards related to continuing operations

Stock-based compensation expense for Employee Stock-Based Awards included in the accompanying Consolidated Statements of Operations related to continuing operations is as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Cost of sales (excluding depreciation and amortization)	$	189	$	46	$	379	$	91
Selling, general and administrative expenses	7,128		7,875		14,079		14,686
Total stock-based compensation	$	7,317	$	7,921	$	14,458	$	14,777

Summary of the weighted average assumptions used for stock option grants

The weighted average assumptions used for grants in the respective period are as follows:



	Six Months Ended June 30,
Weighted Average Assumptions	2014		2015
Expected volatility	33.9	%	28.6	%
Risk-free interest rate	2.06	%	1.70	%
Expected dividend yield	4	%	5	%
Expected life	6.8 years		5.5 years

Summary of stock option activity

A summary of option activity for the six months ended June 30, 2015 is as follows:



	Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Average Intrinsic Value
Outstanding at December 31, 2014	3,678,246		$	23.37
Granted	696,722		43.64
Exercised	(350,910	)	21.03
Forfeited	(20,729	)	23.63
Expired	(11,045	)	22.15
Outstanding at June 30, 2015	3,992,284		$	27.11	5.74	$	24,551
Options exercisable at June 30, 2015	2,728,453		$	22.67	4.30	$	22,715
Options expected to vest	1,178,890		$	36.57	8.85	$	1,743

Aggregate intrinsic value of stock options exercised

The aggregate intrinsic value of stock options exercised for the three and six months ended June 30, 2014 and 2015 is as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Aggregate intrinsic value of stock options exercised	$	7,556	$	1,716	$	8,533	$	5,883

Summary of restricted stock and RSU activity

A summary of restricted stock and RSU activity for the six months ended June 30, 2015 is as follows:



	Restricted Stock and RSUs		Weighted- Average Grant-Date Fair Value
Non-vested at December 31, 2014	1,405,569		$	28.78
Granted	524,896		38.59
Vested	(536,988	)	30.94
Forfeited	(50,678	)	32.14
Non-vested at June 30, 2015	1,342,799		$	33.68

Cash dividends accrued and paid on RSUs for the three and six months ended June 30, 2014 and 2015 are as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Cash dividends on RSUs accrued	$	416	$	631	$	850	$	1,301
Cash dividends on RSUs paid	223		571		1,054		2,300

The fair value of restricted stock and RSUs vested during the three and six months ended June 30, 2014 and 2015 are as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Fair value of restricted stock vested	$	1	$	—	$	1	$	—
Fair value of RSUs vested	3,704		3,600		17,548		19,184

Schedule of performance units

Cash dividends accrued and paid on PUs for the three and six months ended June 30, 2014 and 2015 are as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Cash dividends on PUs accrued	$	142	$	214	$	292	$	425
Cash dividends on PUs paid	91		—		312		1,015

The fair value of earned PUs that vested during the three and six months ended June 30, 2014 and 2015 is as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2015		2014		2015
Fair value of earned PUs that vested	$	2,266	$	44	$	6,296	$	2,107

Summary of Performance Unit (PU) activity

A summary of PU activity for the six months ended June 30, 2015 is as follows:



	Original PU Awards		PU Adjustment(1)		Total PU Awards		Weighted- Average Grant-Date Fair Value
Non-vested at December 31, 2014	461,666		(82,609	)	379,057		$	30.80
Granted	139,446		—		139,446		40.38
Vested	(80,035	)	(4,350	)	(84,385	)	29.62
Forfeited	(19,038	)	—		(19,038	)	30.96
Non-vested at June 30, 2015	502,039		(86,959	)	415,080		$	34.25

_______________________________________________________________________________


(1)	Represents an increase or decrease in the number of original PUs awarded based on either (a) the final performance criteria achievement at the end of the defined performance period of such PUs or (b) a change in estimated awards based on the forecasted performance against the predefined targets.

Calculation of basic and diluted net income (loss) per share attributable to the entity

The calculation of basic and diluted income (loss) per share for the three and six months ended June 30, 2014 and 2015 is as follows:



	Three Months Ended June 30,					Six Months Ended June 30,
	2014			2015		2014			2015
Income (loss) from continuing operations	$	272,702		$	54,007	$	315,423		$	95,746
Total (loss) income from discontinued operations	$	(326	)	$	—	$	(938	)	$	—
Net income (loss) attributable to Iron Mountain Incorporated	$	271,637		$	53,330	$	313,304		$	94,426

Weighted-average shares—basic	192,381,000			210,699,000		192,130,000			210,468,000
Effect of dilutive potential stock options	762,416			958,714		722,609			1,091,022
Effect of dilutive potential restricted stock, RSUs and PUs	382,317			419,002		444,968			603,880
Weighted-average shares—diluted	193,525,733			212,076,716		193,297,577			212,162,902

Earnings (losses) per share—basic:
Income (loss) from continuing operations	$	1.42		$	0.26	$	1.64		$	0.45
Total (loss) income from discontinued operations	$	—		$	—	$	—		$	—
Net income (loss) attributable to Iron Mountain Incorporated—basic	$	1.41		$	0.25	$	1.63		$	0.45

Earnings (losses) per share—diluted:
Income (loss) from continuing operations	$	1.41		$	0.25	$	1.63		$	0.45
Total (loss) income from discontinued operations	$	—		$	—	$	—		$	—
Net income (loss) attributable to Iron Mountain Incorporated—diluted	$	1.40		$	0.25	$	1.62		$	0.45

Antidilutive stock options, RSUs and PUs, excluded from the calculation	1,457,975			1,335,373		1,419,469			846,803

Assets and liabilities carried at fair value measured on a recurring basis

The assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2014 and June 30, 2015, respectively, are as follows:



			Fair Value Measurements at December 31, 2014 Using
Description	Total Carrying Value at December 31, 2014		Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Money Market Funds(1)	$	36,828	$	—		$	36,828		$	—
Time Deposits(1)	16,204		—			16,204			—
Trading Securities	13,172		12,428		(2)	744		(1)	—
Derivative Liabilities(3)	2,411		—			2,411			—



			Fair Value Measurements at June 30, 2015 Using
Description	Total Carrying Value at June 30, 2015		Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Time Deposits(1)	$	20,802	$	—		$	20,802		$	—
Trading Securities	10,960		10,086		(2)	874		(1)	—
Derivative Assets(3)	6,362		—			6,362			—

_______________________________________________________________________________


(1)	Money market funds and time deposits (including certain trading securities) are measured based on quoted prices for similar assets and/or subsequent transactions.


(2)	Securities are measured at fair value using quoted market prices.

(3)

Our derivative assets and liabilities relate to short-term (six months or less) foreign currency contracts that we have entered into to hedge certain of our intercompany exposures, as more fully disclosed at Note 3. We calculate the value of such forward contracts by adjusting the spot rate utilized at the balance sheet date for translation purposes by an estimate of the forward points observed in active markets.

Schedule of changes in accumulated other comprehensive items, net

The changes in accumulated other comprehensive items, net for the six months ended June 30, 2014 and 2015, respectively, are as follows:



	Foreign Currency Translation Adjustments			Market Value Adjustments for Securities		Total
Balance as of December 31, 2013	$	(9,586	)	$	926	$	(8,660	)
Other comprehensive income (loss):
Foreign currency translation adjustments	5,777			—		5,777
Market value adjustment for securities	—			548		548
Total other comprehensive income (loss)	5,777			548		6,325
Balance as of June 30, 2014	$	(3,809	)	$	1,474	$	(2,335	)



	Foreign Currency Translation Adjustments			Market Value Adjustments for Securities		Total
Balance as of December 31, 2014	$	(76,010	)	$	979	$	(75,031	)
Other comprehensive (loss) income:
Foreign currency translation adjustments	(54,742		)	—		(54,742		)
Market value adjustments for securities	—			23		23
Total other comprehensive (loss) income	(54,742		)	23		(54,719		)
Balance as of June 30, 2015	$	(130,752	)	$	1,002	$	(129,750	)

The changes in accumulated other comprehensive items, net for the three months ended June 30, 2014 and 2015, respectively, are as follows:



	Foreign Currency Translation Adjustments			Market Value Adjustments for Securities		Total
Balance as of March 31, 2014	$	(7,909	)	$	926	$	(6,983	)
Other comprehensive income (loss):
Foreign currency translation adjustments	4,100			—		4,100
Market value adjustments for securities	—			548		548
Total other comprehensive income (loss)	4,100			548		4,648
Balance as of June 30, 2014	$	(3,809	)	$	1,474	$	(2,335	)



	Foreign Currency Translation Adjustments			Market Value Adjustments for Securities		Total
Balance as of March 31, 2015	$	(132,084	)	$	1,002	$	(131,082	)
Other comprehensive income (loss):
Foreign currency translation adjustments	1,332			—		1,332
Total other comprehensive income (loss)	1,332			—		1,332
Balance as of June 30, 2015	$	(130,752	)	$	1,002	$	(129,750	)

Other expense (income), net

Other (income) expense, net is as follows:



	Three Months Ended June 30,					Six Months Ended June 30,
	2014			2015		2014			2015
Foreign currency transaction (gains) losses, net	$	(4,347	)	$	1,656	$	2,091		$	23,922
Other, net	(491		)	348		(1,612		)	431
	$	(4,838	)	$	2,004	$	479		$	24,353