Condensed Consolidating Financial Statements (Tables)

6 Months Ended

Oct. 31, 2019

Condensed Financial Information Disclosure [Abstract]

Schedule of Condensed Consolidating Statements of Operations

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS													(in 000s)
Three months ended October 31, 2019	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Total revenues	$	—		$	11,750		$	152,781		$	(3,730	)	$	160,801
Cost of revenues	—			4,866			248,513			(173		)	253,206
Selling, general and administrative	1,538			5,290			147,063			(3,557		)	150,334
Total operating expenses	1,538			10,156			395,576			(3,730		)	403,540
Other income (expense), net	(188,397		)	9,995			1,209			179,932			2,739
Interest expense on external borrowings	—			(21,300		)	(6		)	—			(21,306		)
Loss from continuing operations before income tax benefit	(189,935		)	(9,711		)	(241,592		)	179,932			(261,306		)
Income tax benefit	(1,936		)	(2,832		)	(72,984		)	—			(77,752		)
Net loss from continuing operations	(187,999		)	(6,879		)	(168,608		)	179,932			(183,554		)
Net loss from discontinued operations	—			(4,445		)	—			—			(4,445		)
Net loss	(187,999		)	(11,324		)	(168,608		)	179,932			(187,999		)
Other comprehensive income	919			—			919			(919		)	919
Comprehensive loss	$	(187,080	)	$	(11,324	)	$	(167,689	)	$	179,013		$	(187,080	)

													(in 000s)
Three months ended October 31, 2018	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Total revenues	$	—		$	11,458		$	142,154		$	(4,741	)	$	148,871
Cost of revenues	—			7,014			245,969			(2,168		)	250,815
Selling, general and administrative	1,476			2,847			111,569			(2,573		)	113,319
Total operating expenses	1,476			9,861			357,538			(4,741		)	364,134
Other income (expense), net	(176,485		)	9,018			(898		)	172,829			4,464
Interest expense on external borrowings	—			(21,126		)	(65		)	—			(21,191		)
Loss from continuing operations before income tax benefit	(177,961		)	(10,511		)	(216,347		)	172,829			(231,990		)
Income tax benefit	(1,685		)	(2,316		)	(57,052		)	—			(61,053		)
Net loss from continuing operations	(176,276		)	(8,195		)	(159,295		)	172,829			(170,937		)
Net loss from discontinued operations	—			(5,339		)	—			—			(5,339		)
Net loss	(176,276		)	(13,534		)	(159,295		)	172,829			(176,276		)
Other comprehensive loss	(2,846		)	—			(2,846		)	2,846			(2,846		)
Comprehensive loss	$	(179,122	)	$	(13,534	)	$	(162,141	)	$	175,675		$	(179,122	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS													(in 000s)
Six months ended October 31, 2019	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Total revenues	$	—		$	28,284		$	289,840		$	(6,961	)	$	311,163
Cost of revenues	—			10,082			473,211			(695		)	482,598
Selling, general and administrative	1,538			8,187			263,011			(6,266		)	266,470
Total operating expenses	1,538			18,269			736,222			(6,961		)	749,068
Other income (expense), net	(340,149		)	20,492			15,077			316,442			11,862
Interest expense on external borrowings	—			(42,356		)	(21		)	—			(42,377		)
Loss from continuing operations before income tax benefit	(341,687		)	(11,849		)	(431,326		)	316,442			(468,420		)
Income tax benefit	(3,441		)	(3,010		)	(132,691		)	—			(139,142		)
Net loss from continuing operations	(338,246		)	(8,839		)	(298,635		)	316,442			(329,278		)
Net loss from discontinued operations	—			(8,968		)	—			—			(8,968		)
Net loss	(338,246		)	(17,807		)	(298,635		)	316,442			(338,246		)
Other comprehensive loss	(1,401		)	—			(1,401		)	1,401			(1,401		)
Comprehensive loss	$	(339,647	)	$	(17,807	)	$	(300,036	)	$	317,843		$	(339,647	)

													(in 000s)
Six months ended October 31, 2018	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Total revenues	$	—		$	28,290		$	273,631		$	(7,867	)	$	294,054
Cost of revenues	—			12,047			463,087			(2,759		)	472,375
Selling, general and administrative	1,476			6,097			216,594			(5,108		)	219,059
Total operating expenses	1,476			18,144			679,681			(7,867		)	691,434
Other income (expense), net	(330,101		)	18,845			6,150			314,112			9,006
Interest expense on external borrowings	—			(42,249		)	(132		)	—			(42,381		)
Loss from continuing operations before income tax benefit	(331,577		)	(13,258		)	(400,032		)	314,112			(430,755		)
Income tax benefit	(2,631		)	(6,017		)	(102,373		)	—			(111,021		)
Net loss from continuing operations	(328,946		)	(7,241		)	(297,659		)	314,112			(319,734		)
Net loss from discontinued operations	—			(9,212		)	—			—			(9,212		)
Net loss	(328,946		)	(16,453		)	(297,659		)	314,112			(328,946		)
Other comprehensive loss	(4,577		)	—			(4,577		)	4,577			(4,577		)
Comprehensive loss	$	(333,523	)	$	(16,453	)	$	(302,236	)	$	318,689		$	(333,523	)

Schedule of Condensed Consolidating Balance Sheets

CONDENSED CONSOLIDATING BALANCE SHEETS											(in 000s)
As of October 31, 2019	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)		Other Subsidiaries		Eliminations			Consolidated H&R Block
Cash & cash equivalents	$	—		$	4,143	$	241,169	$	—		$	245,312
Cash & cash equivalents - restricted	—			—		176,332		—			176,332
Receivables, net	—			36,244		38,466		—			74,710
Prepaid expenses and other current assets	2,812			3,480		98,766		—			105,058
Total current assets	2,812			43,867		554,733		—			601,412
Property and equipment, net	—			387		205,829		—			206,216
Operating lease right of use asset	—			295		475,674		—			475,969
Intangible assets, net	—			—		425,377		—			425,377
Goodwill	—			—		815,331		—			815,331
Deferred tax assets and income taxes receivable	2,322			15,953		127,532		—			145,807
Investments in subsidiaries	3,078,076			—		119,925		(3,198,001		)	—
Amounts due from affiliates	—			1,667,699		3,131,764		(4,799,463		)	—
Other noncurrent assets	—			58,773		27,856		—			86,629
Total assets	$	3,083,210		$	1,786,974	$	5,884,021	$	(7,997,464	)	$	2,756,741
Accounts payable and accrued expenses	2,570			8,252		100,617		—			111,439
Accrued salaries, wages and payroll taxes	—			2,013		55,589		—			57,602
Accrued income taxes and reserves for uncertain tax positions	—			1,060		105,065		—			106,125
Current portion of long-term debt	—			648,651		—		—			648,651
Operating lease liabilities	—			150		162,747		—			162,897
Deferred revenue and other current liabilities	—			20,342		156,901		—			177,243
Total current liabilities	2,570			680,468		580,919		—			1,263,957
Long-term debt and line of credit borrowings	—			980,299		—		—			980,299
Deferred tax liabilities and reserves for uncertain tax positions	24,623			1,486		154,253		—			180,362
Operating lease liabilities	—			148		326,543		—			326,691
Deferred revenue and other noncurrent liabilities	—			4,648		76,531		—			81,179
Amounts due to affiliates	3,131,764			—		1,667,699		(4,799,463		)	—
Total liabilities	3,158,957			1,667,049		2,805,945		(4,799,463		)	2,832,488
Stockholders' equity (deficiency)	(75,747		)	119,925		3,078,076		(3,198,001		)	(75,747		)
Total liabilities and stockholders' equity	$	3,083,210		$	1,786,974	$	5,884,021	$	(7,997,464	)	$	2,756,741

CONDENSED CONSOLIDATING BALANCE SHEETS											(in 000s)
As of October 31, 2018	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)		Other Subsidiaries		Eliminations			Consolidated H&R Block
Cash & cash equivalents	$	—		$	4,417	$	596,382	$	—		$	600,799
Cash & cash equivalents - restricted	—			—		122,507		—			122,507
Receivables, net	—			39,241		22,045		—			61,286
Prepaid expenses and other current assets	2,811			3,593		100,006		—			106,410
Total current assets	2,811			47,251		840,940		—			891,002
Property and equipment, net	—			524		241,248		—			241,772
Intangible assets, net	—			—		364,524		—			364,524
Goodwill	—			—		507,191		—			507,191
Deferred tax assets and income taxes receivable	434			17,941		112,612		—			130,987
Investments in subsidiaries	2,600,520			—		114,862		(2,715,382		)	—
Amounts due from affiliates	—			1,520,018		2,623,445		(4,143,463		)	—
Other noncurrent assets	—			58,288		39,532		—			97,820
Total assets	$	2,603,765		$	1,644,022	$	4,844,354	$	(6,858,845	)	$	2,233,296
Accounts payable and accrued expenses	$	2,360		$	9,933	$	102,100	$	—		$	114,393
Accrued salaries, wages and payroll taxes	—			1,641		41,755		—			43,396
Accrued income taxes and reserves for uncertain tax positions	—			1,060		93,197		—			94,257
Deferred revenue and other current liabilities	—			20,409		163,266		—			183,675
Total current liabilities	2,360			33,043		400,318		—			435,721
Long-term debt	—			1,491,328		—		—			1,491,328
Deferred tax liabilities and reserves for uncertain tax positions	9,285			3,989		222,525		—			235,799
Deferred revenue and other noncurrent liabilities	—			800		100,973		—			101,773
Amounts due to affiliates	2,623,445			—		1,520,018		(4,143,463		)	—
Total liabilities	2,635,090			1,529,160		2,243,834		(4,143,463		)	2,264,621
Stockholders' equity (deficiency)	(31,325		)	114,862		2,600,520		(2,715,382		)	(31,325		)
Total liabilities and stockholders' equity	$	2,603,765		$	1,644,022	$	4,844,354	$	(6,858,845	)	$	2,233,296

CONDENSED CONSOLIDATING BALANCE SHEETS										(in 000s)
As of April 30, 2019	H&R Block, Inc. (Guarantor)		Block Financial (Issuer)		Other Subsidiaries		Eliminations			Consolidated H&R Block
Cash & cash equivalents	$	—	$	4,109	$	1,568,041	$	—		$	1,572,150
Cash & cash equivalents - restricted	—		—		135,577		—			135,577
Receivables, net	—		35,901		103,064		—			138,965
Prepaid expenses and other current assets	2,812		1,695		142,160		—			146,667
Total current assets	2,812		41,705		1,948,842		—			1,993,359
Property and equipment, net	—		552		211,540		—			212,092
Intangible assets, net	—		—		342,493		—			342,493
Goodwill	—		—		519,937		—			519,937
Deferred tax assets and income taxes receivable	3,218		15,953		122,808		—			141,979
Investments in subsidiaries	3,378,009		—		137,733		(3,515,742		)	—
Amounts due from affiliates	—		1,562,958		2,815,617		(4,378,575		)	—
Other noncurrent assets	—		54,976		35,109		—			90,085
Total assets	$	3,384,039	$	1,676,144	$	6,134,079	$	(7,894,317	)	$	3,299,945
Accounts payable and accrued expenses	$	2,272	$	19,735	$	227,518	$	—		$	249,525
Accrued salaries, wages and payroll taxes	—		1,564		194,963		—			196,527
Accrued income taxes and reserves for uncertain tax positions	—		1,060		270,913		—			271,973
Deferred revenue and other current liabilities	—		21,144		183,832		—			204,976
Total current liabilities	2,272		43,503		877,226		—			923,001
Long-term debt	—		1,492,629		—		—			1,492,629
Deferred tax liabilities and reserves for uncertain tax positions	24,623		1,486		171,797		—			197,906
Deferred revenue and other noncurrent liabilities	—		793		144,089		—			144,882
Amounts due to affiliates	2,815,617		—		1,562,958		(4,378,575		)	—
Total liabilities	2,842,512		1,538,411		2,756,070		(4,378,575		)	2,758,418
Stockholders' equity	541,527		137,733		3,378,009		(3,515,742		)	541,527
Total liabilities and stockholders' equity	$	3,384,039	$	1,676,144	$	6,134,079	$	(7,894,317	)	$	3,299,945

Schedule of Condensed Consolidating Statements of Cash Flows

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS													(in 000s)
Six months ended October 31, 2019	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Net cash used in operating activities	$	—		$	(20,938	)	$	(672,378	)	$	—		$	(693,316	)
Cash flows from investing:
Capital expenditures	—			—			(42,854		)	—			(42,854		)
Payments made for business acquisitions, net of cash acquired	—			—			(416,925		)	—			(416,925		)
Franchise loans funded	—			(15,868		)	(153		)	—			(16,021		)
Payments from franchisees	—			7,476			426			—			7,902
Intercompany borrowings (payments)	—			(104,742		)	(293,217		)	397,959			—
Other, net	—			(894		)	51,733			—			50,839
Net cash used in investing activities	—			(114,028		)	(700,990		)	397,959			(417,059		)
Cash flows from financing:
Proceeds from line of credit borrowings	—			135,000			—			—			135,000
Dividends paid	(104,063		)	—			—			—			(104,063		)
Repurchase of common stock, including shares surrendered	(190,369		)	—			—			—			(190,369		)
Proceeds from exercise of stock options	1,215			—			—			—			1,215
Intercompany borrowings (payments)	293,217			—			104,742			(397,959		)	—
Other, net	—			—			(18,544		)	—			(18,544		)
Net cash provided by (used in) financing activities	—			135,000			86,198			(397,959		)	(176,761		)
Effects of exchange rates on cash	—			—			1,053			—			1,053
Net increase (decrease) in cash, including restricted balances	—			34			(1,286,117		)	—			(1,286,083		)
Cash, cash equivalents and restricted cash, beginning of period	—			4,109			1,703,618			—			1,707,727
Cash, cash equivalents and restricted cash, end of period	$	—		$	4,143		$	417,501		$	—		$	421,644

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS													(in 000s)
Six months ended October 31, 2018	H&R Block, Inc. (Guarantor)			Block Financial (Issuer)			Other Subsidiaries			Eliminations			Consolidated H&R Block
Net cash used in operating activities	$	—		$	(22,827	)	$	(604,864	)	$	—		$	(627,691	)
Cash flows from investing:
Capital expenditures	—			(164		)	(66,258		)	—			(66,422		)
Payments made for business acquisitions, net of cash acquired	—			—			(24,549		)	—			(24,549		)
Franchise loans funded	—			(8,740		)	(175		)	—			(8,915		)
Payments from franchisees	—			11,442			247			—			11,689
Intercompany borrowings (payments)	—			20,819			(203,834		)	183,015			—
Other, net	—			209			4,784			—			4,993
Net cash provided by (used in) investing activities	—			23,566			(289,785		)	183,015			(83,204		)
Cash flows from financing:
Dividends paid	(103,484		)	—			—			—			(103,484		)
Repurchase of common stock, including shares surrendered	(102,096		)	—			—			—			(102,096		)
Proceeds from exercise of stock options	1,746			—			—			—			1,746
Intercompany borrowings (payments)	203,834			—			(20,819		)	(183,015		)	—
Other, net	—			(668		)	(21,766		)	—			(22,434		)
Net cash used in financing activities	—			(668		)	(42,585		)	(183,015		)	(226,268		)
Effects of exchange rates on cash	—			—			(3,209		)	—			(3,209		)
Net increase (decrease) in cash, including restricted balances	—			71			(940,443		)	—			(940,372		)
Cash, cash equivalents and restricted cash, beginning of period	—			4,346			1,659,332			—			1,663,678
Cash, cash equivalents and restricted cash, end of period	$	—		$	4,417		$	718,889		$	—		$	723,306