Discontinued Operations

9 Months Ended

Sep. 30, 2016

Discontinued Operations And Disposal Groups [Abstract]

Discontinued Operations

4. DISCONTINUED OPERATIONS

As of September 30, 2016, the results of operations for campuses that have ceased operations prior to 2015 are presented within discontinued operations. Prior to January 1, 2015, our Transitional Group campuses met the criteria for discontinued operations upon completion of their teach-out. Commencing January 1, 2015, in accordance with new guidance under ASC Topic 360, only campuses that meet the criteria of a strategic shift upon disposal will be classified within discontinued operations, among other criteria. Since the January 2015 effective date of the updated guidance within ASC Topic 360, we have not had any campuses that met the criteria to be considered a discontinued operation.  

Results of Discontinued Operations

The summary of unaudited results of operations for our discontinued operations for the quarters and years to date ended September 30, 2016 and 2015 were as follows (dollars in thousands):

	For the Quarter Ended September 30,						For the Year to Date Ended September 30,
	2016			2015			2016			2015
Revenue	$	-		$	3		$	-		$	6
Total operating expenses	$	295		$	547		$	1,676		$	1,636
Loss before income tax	$	(295	)	$	(544	)	$	(1,676	)	$	(1,616	)
Benefit from income tax		(109	)		-			(626	)		-
Loss from discontinued operations, net of tax	$	(186	)	$	(544	)	$	(1,050	)	$	(1,616	)
Net loss per share - Basic and Diluted	$	-		$	(0.01	)	$	(0.01	)	$	(0.02	)

Assets and Liabilities of Discontinued Operations

Assets and liabilities of discontinued operations on our condensed consolidated balance sheets as of September 30, 2016 and December 31, 2015 include the following (dollars in thousands):

	September 30,		December 31,
	2016		2015
Assets:
Current assets:
Receivables, net	$	176	$	254
Total current assets		176		254
Non-current assets:
Other assets, net		543		720
Deferred income tax assets, net		8,091		8,091
Total assets of discontinued operations	$	8,810	$	9,065
Liabilities:
Current liabilities:
Accounts payable and accrued expenses	$	81	$	528
Remaining lease obligations		6,923		12,539
Total current liabilities		7,004		13,067
Non-current liabilities:
Remaining lease obligations		5,698		9,212
Other		164		164
Total liabilities of discontinued operations	$	12,866	$	22,443

Remaining Lease Obligations of Discontinued Operations

A number of the campuses that ceased operations prior to January 1, 2015 have remaining lease obligations that expire over time with the latest expiration in 2020. A liability is recorded representing the fair value of the remaining lease obligation at the time the space is no longer being utilized. Changes in our future remaining lease obligations, which are reflected within current and non-current liabilities of discontinued operations on our condensed consolidated balance sheets, for the quarters and years to date ended September 30, 2016 and 2015 were as follows (dollars in thousands):

	Balance, Beginning of Period		Charges Incurred (1)			Net Cash Payments			Other		Balance, End of Period
For the quarter ended September 30, 2016	$	16,149	$	(479	)	$	(3,049	)	$	-	$	12,621
For the quarter ended September 30, 2015	$	27,993	$	(151	)	$	(3,275	)	$	50	$	24,617
For the year to date ended September 30, 2016	$	21,751	$	(78	)	$	(9,052	)	$	-	$	12,621
For the year to date ended September 30, 2015	$	37,616	$	(564	)	$	(12,485	)	$	50	$	24,617

(1) Includes charges for vacated spaces and subsequent adjustments for accretion, revised estimates and variances between estimated and actual charges, net of any reversals for terminated lease obligations.