3.	RECENTLY ADOPTED ACCOUNTING STANDARD

In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” The standard amends certain aspects of accounting for employee share-based payment transactions, including the accounting for income taxes related to those transactions and forfeitures. The standard requires recognizing excess tax benefits and deficiencies on share-based awards in the tax provision instead of in equity. Also, the standard requires these amounts to be classified as an operating activity, and shares withheld to satisfy employee taxes to be classified as a financing activity in the statement of cash flows, rather than as currently classified as financing and operating activities, respectively. The standard was effective for annual reporting periods beginning after December 15, 2016 and interim periods within that reporting period, with early adoption permitted. The Company elected to early adopt the standard in fiscal year 2016. The impact of the early adoption resulted in the following:

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The standard requires that excess tax benefits of the settlement or vesting of time-based restricted stock or time-based restricted stock units and performance-based restricted stock or performance-based restricted stock units be recorded within income tax expense. Prior to adoption this amount would have been recorded as an increase in additional paid-in capital. Additionally, the standard requires that excess tax benefits are now reported as an operating activity in the Company’s Consolidated Statements of Cash Flows, rather than as a financing activity as was previously reported. The Company applied this guidance prospectively as of January 1, 2016 during the quarterly period ended December 31, 2016, and, accordingly, data previously reported for the three and six months ended June 30, 2016 have been adjusted, as follows:


	Three Months Ended June 30, 2016
	As Reported		Adjusted
	(in thousands, except share and per share data)
Provision for income taxes	$	12,878	$	12,432
Net Income	$	23,279	$	23,725
Basic net income per share	$	0.80	$	0.81
Diluted net income per share	$	0.79	$	0.80
Diluted weighted average common shares outstanding		29,423,845		29,477,870


	Six Months Ended June 30, 2016
	As Reported			Adjusted
	(in thousands, except share and per share data)
Provision for income taxes	$	25,919		$	25,170
Net Income	$	46,681		$	47,430
Basic net income per share	$	1.58		$	1.61
Diluted net income per share	$	1.57		$	1.60
Diluted weighted average common shares outstanding		29,642,287			29,694,081
Cash flows provided by operating activities	$	15,632		$	16,442
Cash flows used in financing activities	$	(18,241	)	$	(19,051	)

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The Company elected to change its policy on accounting for forfeitures and recognize forfeitures as they occur. The Company applied this guidance on a modified retrospective transition method. The Company determined that the cumulative effect of applying the guidance under the modified retrospective transition method was not material to its Consolidated Financial Statements.

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The standard requires the presentation of employee taxes as a financing activity in the Consolidated Statements of Cash Flows. This provision did not impact the Company’s Consolidated Financial Statements as the Company presented employee taxes as a financing activity in its Consolidated Statements of Cash Flows.

The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of diluted earnings per share for 2016, which did not materially increase the diluted weighted average common shares outstanding.