Condensed Consolidating Financial Statements

6 Months Ended

Oct. 31, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Financial Statements

NOTE 15: CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

Block Financial is a 100% owned subsidiary of the Company. Block Financial is the Issuer and the Company is the full and unconditional Guarantor of the Senior Notes, our 2015 CLOC and other indebtedness issued from time to time. These condensed consolidating financial statements have been prepared using the equity method of accounting. Earnings of subsidiaries are, therefore, reflected in the Company's investment in subsidiaries account. The elimination entries eliminate investments in subsidiaries, related stockholders' equity and other intercompany balances and transactions.

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS													(in 000s)
Six months ended October 31, 2015	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Total revenues	$	—		$	38,739		$	227,515		$	(121	)	$	266,133
Cost of revenues	—			21,565			418,464			(120		)	439,909
Selling, general and administrative	3,415			17,750			212,875			(1		)	234,039
Total operating expenses	3,415			39,315			631,339			(121		)	673,948
Other income	1,730			11,535			1,456			(3,783		)	10,938
Interest expense on external borrowings	—			(22,521		)	(235		)	—			(22,756		)
Other expenses	(248,022		)	(744		)	(25,421		)	268,992			(5,195		)
Loss from continuing operations before tax benefit	(249,707		)	(12,306		)	(428,024		)	265,209			(424,828		)
Income tax benefit	(5,041		)	(761		)	(180,003		)	—			(185,805		)
Net loss from continuing operations	(244,666		)	(11,545		)	(248,021		)	265,209			(239,023		)
Net loss from discontinued operations	—			(5,643		)	—			—			(5,643		)
Net loss	(244,666		)	(17,188		)	(248,021		)	265,209			(244,666		)
Other comprehensive loss	(17,948		)	(8,444		)	(17,948		)	26,392			(17,948		)
Comprehensive loss	$	(262,614	)	$	(25,632	)	$	(265,969	)	$	291,601		$	(262,614	)

Six months ended October 31, 2014	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Total revenues	$	—		$	44,751		$	223,556		$	(93	)	$	268,214
Cost of revenues	—			22,658			396,853			(88		)	419,423
Selling, general and administrative	—			9,197			185,387			(5		)	194,579
Total operating expenses	—			31,855			582,240			(93		)	614,002
Other income	2,393			3,672			420			(5,962		)	523
Interest expense on external borrowings	—			(27,436		)	(202		)	—			(27,638		)
Other expenses	(236,039		)	(2,276		)	(19,496		)	254,325			(3,486		)
Loss from continuing operations before tax benefit	(233,646		)	(13,144		)	(377,962		)	248,363			(376,389		)
Income tax benefit	(5,416		)	(9,663		)	(139,232		)	—			(154,311		)
Net loss from continuing operations	(228,230		)	(3,481		)	(238,730		)	248,363			(222,078		)
Net income (loss) from discontinued operations	—			(8,843		)	2,691			—			(6,152		)
Net loss	(228,230		)	(12,324		)	(236,039		)	248,363			(228,230		)
Other comprehensive income	1,400			4,261			1,400			(5,661		)	1,400
Comprehensive loss	$	(226,830	)	$	(8,063	)	$	(234,639	)	$	242,702		$	(226,830	)

CONDENSED CONSOLIDATING BALANCE SHEETS											(in 000s)
As of October 31, 2014	H&R Block, Inc. (Guarantor)		Block Financial (Issuer)		Other Subsidiaries			Eliminations			Consolidated H&R Block
Cash & cash equivalents	$	—	$	432,224	$	195,540		$	(274	)	$	627,490
Cash & cash equivalents - restricted	—		5,431		50,112			—			55,543
Receivables, net	79		84,196		23,430			—			107,705
Deferred tax assets and income taxes receivable	—		101,811		95,382			—			197,193
Prepaid expenses and other current assets	—		11,760		76,510			—			88,270
Investments in AFS securities	—		381,080		100			—			381,180
Total current assets	79		1,016,502		441,074			(274		)	1,457,381
Mortgage loans held for investment, net	—		251,092		—			—			251,092
Property and equipment, net	—		157		318,068			—			318,225
Intangible assets, net	—		—		414,045			—			414,045
Goodwill	—		—		464,182			—			464,182
Deferred tax assets and income taxes receivable	—		54,273		(16,336		)	—			37,937
Investments in subsidiaries	675,218		—		53,769			(728,987		)	—
Amounts due from affiliates	565,387		10		92,974			(658,371		)	—
Other noncurrent assets	—		103,199		45,229			—			148,428
Total assets	$	1,240,684	$	1,425,233	$	1,813,005		$	(1,387,632	)	$	3,091,290
Customer banking deposits	$	—	$	455,134	$	—		$	(274	)	$	454,860
Accounts payable and accrued expenses	943		4,015		92,147			—			97,105
Accrued salaries, wages and payroll taxes	—		2,197		34,018			—			36,215
Accrued income taxes	—		47,732		99,268			—			147,000
Current portion of long-term debt	—		—		772			—			772
Deferred revenue and other current liabilities	—		225,247		114,478			—			339,725
Total current liabilities	943		734,325		340,683			(274		)	1,075,677
Long-term debt	—		497,753		7,835			—			505,588
Deferred tax liabilities and reserves for uncertain tax positions	—		45,346		106,605			—			151,951
Deferred revenue and other noncurrent liabilities	—		2,131		117,267			—			119,398
Amounts due to affiliates	1,065		91,909		565,397			(658,371		)	—
Total liabilities	2,008		1,371,464		1,137,787			(658,645		)	1,852,614
Stockholders' equity	1,238,676		53,769		675,218			(728,987		)	1,238,676
Total liabilities and stockholders' equity	$	1,240,684	$	1,425,233	$	1,813,005		$	(1,387,632	)	$	3,091,290

CONDENSED CONSOLIDATING BALANCE SHEETS										(in 000s)
As of April 30, 2015	H&R Block, Inc. (Guarantor)		Block Financial (Issuer)		Other Subsidiaries		Eliminations			Consolidated H&R Block
Cash & cash equivalents	$	—	$	478,077	$	1,529,553	$	(440	)	$	2,007,190
Cash & cash equivalents - restricted	—		45,098		46,874		—			91,972
Receivables, net	—		80,332		87,632		—			167,964
Deferred tax assets and income taxes receivable	—		77,418		96,849		—			174,267
Prepaid expenses and other current assets	—		7,771		62,512		—			70,283
Investments in AFS securities	—		434,924		4,701		—			439,625
Total current assets	—		1,123,620		1,828,121		(440		)	2,951,301
Mortgage loans held for investment, net	—		239,338		—		—			239,338
Property and equipment, net	—		218		311,169		—			311,387
Intangible assets, net	—		—		432,142		—			432,142
Goodwill	—		—		441,831		—			441,831
Deferred tax assets and income taxes receivable	—		44,788		—		(31,327		)	13,461
Investments in subsidiaries	1,371,677		—		116,870		(1,488,547		)	—
Amounts due from affiliates	463,434		134,094		1,058		(598,586		)	—
Other noncurrent assets	—		81,075		44,885		—			125,960
Total assets	$	1,835,111	$	1,623,133	$	3,176,076	$	(2,118,900	)	$	4,515,420
Customer banking deposits	$	—	$	744,681	$	—	$	(440	)	$	744,241
Accounts payable and accrued expenses	1,104		7,672		222,546		—			231,322
Accrued salaries, wages and payroll taxes	—		1,946		142,798		—			144,744
Accrued income taxes	—		49,529		385,155		—			434,684
Current portion of long-term debt	—		—		790		—			790
Deferred revenue and other current liabilities	—		177,063		145,445		—			322,508
Total current liabilities	1,104		980,891		896,734		(440		)	1,878,289
Long-term debt	—		497,893		7,405		—			505,298
Deferred tax liabilities and reserves for uncertain tax positions	—		25,696		148,217		(31,327		)	142,586
Deferred revenue and other noncurrent liabilities	—		1,783		154,515		—			156,298
Amounts due to affiliates	1,058		—		597,528		(598,586		)	—
Total liabilities	2,162		1,506,263		1,804,399		(630,353		)	2,682,471
Stockholders' equity	1,832,949		116,870		1,371,677		(1,488,547		)	1,832,949
Total liabilities and stockholders' equity	$	1,835,111	$	1,623,133	$	3,176,076	$	(2,118,900	)	$	4,515,420

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS													(in 000s)
Six months ended October 31, 2015	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Net cash provided by (used in) operating activities:	$	—		$	36,078		$	(638,791	)	$	—		$	(602,713	)
Cash flows from investing:
Sales, maturities of and payments received on AFS securities	—			430,460			3,801			—			434,261
Principal payments on mortgage loans held for investment, net	—			17,006			—			—			17,006
Capital expenditures	—			(20		)	(38,759		)	—			(38,779		)
Payments made for business acquisitions, net of cash acquired	—			—			(61,846		)	—			(61,846		)
Loans made to franchisees	—			(10,206		)	(75		)	—			(10,281		)
Repayments from franchisees	—			17,301			172			—			17,473
Intercompany payments/investments in subsidiaries	—			(1,200,465		)	(1,611,564		)	2,812,029			—
Other, net	—			4,854			2,392			—			7,246
Net cash provided by (used in) investing activities	—			(741,070		)	(1,705,879		)	2,812,029			365,080
Cash flows from financing:
Proceeds from long-term debt	—			996,831			—			—			996,831
Customer banking deposits, net	—			(327,145		)	—			440			(326,705		)
Transfer of HRB Bank deposits	—			(419,028		)	—			—			(419,028		)
Dividends paid	(110,338		)	—			—			—			(110,338		)
Repurchase of common stock, including shares surrendered	(1,517,786		)	—			—			—			(1,517,786		)
Proceeds from exercise of stock options	16,875			—			—			—			16,875
Intercompany borrowings	1,611,564			—			1,200,465			(2,812,029		)	—
Other, net	(315		)	(16,879		)	(20,626		)	—			(37,820		)
Net cash provided by (used in) financing activities	—			233,779			1,179,839			(2,811,589		)	(1,397,971		)
Effects of exchange rates on cash	—			—			(10,905		)	—			(10,905		)
Net decrease in cash and cash equivalents	—			(471,213		)	(1,175,736		)	440			(1,646,509		)
Cash and cash equivalents at beginning of the period	—			478,077			1,529,553			(440		)	2,007,190
Cash and cash equivalents at end of the period	$	—		$	6,864		$	353,817		$	—		$	360,681

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS													(in 000s)
Six months ended October 31, 2014	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Net cash provided by (used in) operating activities:	$	—		$	55,612		$	(683,189	)	$	—		$	(627,577	)
Cash flows from investing:
Sales, maturities of and payments received on AFS securities	—			49,013			—			—			49,013
Principal payments on mortgage loans held for investment, net	—			13,451			—			—			13,451
Capital expenditures	—			(119		)	(70,808		)	—			(70,927		)
Payments made for business acquisitions, net of cash acquired	—			—			(94,230		)	—			(94,230		)
Loans made to franchisees	—			(18,180		)	(71		)	—			(18,251		)
Repayments from franchisees	—			29,404			233			—			29,637
Intercompany payments/investments in subsidiaries	—			400,000			(109,031		)	(290,969		)	—
Other, net	—			4,372			6,213			—			10,585
Net cash provided by (used in) investing activities	—			477,941			(267,694		)	(290,969		)	(80,722		)
Cash flows from financing:
Repayments of long-term debt	—			(400,000		)	—			—			(400,000		)
Customer banking deposits, net	—			(317,095		)	—			826			(316,269		)
Dividends paid	(109,871		)	—			—			—			(109,871		)
Repurchase of common stock, including shares surrendered	(10,247		)	—			—			—			(10,247		)
Proceeds from exercise of stock options	14,477			—			—			—			14,477
Intercompany borrowings	105,641			3,390			(400,000		)	290,969			—
Other, net	—			—			(23,392		)	—			(23,392		)
Net cash used in financing activities	—			(713,705		)	(423,392		)	291,795			(845,302		)
Effects of exchange rates on cash	—			—			(4,216		)	—			(4,216		)
Net decrease in cash and cash equivalents	—			(180,152		)	(1,378,491		)	826			(1,557,817		)
Cash and cash equivalents at beginning of the period	—			612,376			1,574,031			(1,100		)	2,185,307
Cash and cash equivalents at end of the period	$	—		$	432,224		$	195,540		$	(274	)	$	627,490