Significant Accounting Policies and Practices (Tables)

3 Months Ended

Mar. 31, 2018

Schedule of Contract with Customer, Asset and Liability

pon the adoption, the Company was required to reclassify certain assets used in service concession arrangements that were previously included in Leasehold improvements, equipment and construction in progress, net, to Other assets, net within the Condensed Consolidated Balance Sheet for March 31, 2018 (as discussed previously, the prior period presented has not been recasted).

In addition, the Company has the contractual right to invoice a customer prior to the performance obligation being satisfied in certain contractual arrangements, primarily related to monthly parking arrangements, and therefore effective January 1, 2018; the Company established a contract asset with a corresponding contract liability for the performance obligation expected to be satisfied at a future date. The impact of this change on the Condensed Consolidated Balance Sheets as of March 31, 2018 is as follows:



	Impact of Changes in Accounting Policies for the Three Months Ended March 31, 2018
(millions, unaudited)	As Reported		Balances without Adoption of Topics 606 and 853		Impact of Adoption Increase/(Decrease)
Assets			138.5
Notes and accounts receivable, net (1)	$	136.5	$	125.4	$	11.1
Leasehold improvements, equipment and construction in progress, net (2)	27.1		27.7		(0.6		)
Other assets, net (2)	18.3		17.7		0.6
Liabilities
Accrued expenses (1)	$	30.3	$	19.2	$	11.1

(1) Approximately $11.1 million and $11.1 million of contract assets and contract liabilities, respectively, were recognized as of March 31, 2018.

(2) Leasehold improvements used in service concession arrangements of approximately $0.6 million were reclassified from Leasehold improvements, equipment and construction in progress to Other assets, net, as of March 31, 201

he following table provides information about contract assets and contract liabilities with customers and clients as of March 31, 2018:



(millions, unaudited)	March 31, 2018
Accounts receivable	$	124.3
Contract asset	12.0
Contract liability	16.3

The following table provides information about changes to contract asset balances for the three month period ended March 31, 2018:



(millions, unaudited)	Contract Assets
Balance as of January 1, 2018	$	12.2
Additional contract assets	35.2
Reclassification to accounts receivable	(35.4		)
Balance as of March 31, 2018	$	12.0

The following table provides information about changes to contract liability balances for the three month period ended March 31, 2018:



(millions, unaudited)	Contract Liabilities
Balance as of January 1, 2018	$	20.5
Additional contract liabilities	44.0
Recognition of revenue from contract liabilities	(48.2		)
Balance as of March 31, 2018	$	16.3

Schedule of Disaggregation of Revenue

he adoption of Topics 606 and 853 had no impact to the Company’s Gross profit, Operating income or Net income for the three months ended March 31, 2018. Certain expenses, primarily rental payments for the contractual arrangements that meet the definition of service concession arrangements under Topic 853, have been recorded as a reduction of revenue for the three months ended March 31, 2018 (as discussed above, prior periods have not been recasted).

The impact of this change to gross profit and depreciation and amortization for the three months ended March 31, 2018 was as follows:



	Impact of Changes in Accounting Policies for the Three Months Ended March 31, 2018
(millions, unaudited)	As Reported		Balances without Adoption of Topics 853 and 606		Impact of Adoption Increase/(Decrease)
Parking services revenue
Lease type contracts (1)	$	99.5	$	131.1	$	(31.6	)
Management type contracts	94.4		94.4		—

Reimbursed management type contract revenue	172.9		172.9		—
Total parking services revenue	366.8		398.4		(31.6		)
Cost of parking services
Lease type contracts (1)	94.6		126.1		(31.5		)
Management type contracts	59.9		59.9		—

Reimbursed management type contract expense	172.9		172.9		—
Total cost of parking services	327.4		358.9		(31.5		)
Gross profit
Lease type contracts	4.9		5.0		(0.1		)
Management type contracts	34.5		34.5		—
Total gross profit	$	39.4	$	39.5	$	(0.1	)

Depreciation and amortization	$	4.0	$	4.1	$	(0.1	)

(1) Certain expenses, primarily rental expense for contractual arrangements that meet the definition of a service concession arrangement under Topic 853, of approximately $31.5 million that would have been previously classified as Cost of parking services - lease type contracts have been classified as a reduction of revenue and included in Parking services revenue - Lease type contracts for the three months ended March 31, 2018.

The table below shows amortization expense related to cost of contracts for the three-month periods ended March 31, 2018 and March 31, 2017. Amortization expense of cost of contracts related to service concession arrangements within the scope of Topic 853 is recorded as a reduction of revenue and was not significant for the period ended March 31, 2018.



	Three Months Ended
(millions, unaudited)	March 31, 2018	March 31, 2017
Amortization expense related to cost of contract included in depreciation and amortization	0.8	0.8