Correction of Immaterial Errors

9 Months Ended

Sep. 30, 2021

Accounting Changes And Error Corrections [Abstract]

Note 9. Correction of Immaterial Errors

Beginning in the first quarter of 2019, the Company made changes to its process and presentation of freight services revenue and directly related transportation operating expenses with the objective that at each reporting level (reporting entity, segment and consolidated level) the gross revenue and associated directly related operating expenses be representative of the location where the services were performed, the operating expenses were incurred and where the revenues were earned. During the second quarter of 2021, management identified and corrected certain immaterial errors in the Company’s historical financial statements primarily related to this process that was utilized through the first quarter of 2021. The process missed an intercompany elimination of revenues and an equal and offsetting amount of directly related transportation expenses, principally impacting airfreight services in North Asia. The errors overstated revenues and directly related transportation operating expenses by equal amounts in the consolidated statements of earnings. The errors had no impact on operating income, net earnings, and earnings per share nor any other financial statement amount. Further, the errors had no impact on the balance sheets, statements of shareholders’ equity, other comprehensive income and cash flows. These errors do not affect any of the metrics used to calculate or evaluate management’s compensation and had no impact on bonuses, commissions, share-based compensation or any other employee remuneration. Historical amounts have been revised and are presented on a comparable basis.

The below tables present the effect of the correction for the following periods:

	Three Months ended September 30, 2020
	As Reported		Adjustments			As Corrected
Revenues:
Airfreight services	$	1,093,550	$	(110,351	)	$	983,199
Ocean freight and ocean services		612,858		(3,042	)		609,816
Customs brokerage and other services		758,389		(2,691	)		755,698
Total revenues¹		2,464,797		(116,084	)		2,348,713

Directly related transportation operating expenses:
Airfreight services	$	833,689	$	(110,349	)	$	723,340
Ocean freight and ocean services		455,072		(3,044	)		452,028
Customs brokerage and other services		441,657		(2,691	)		438,966
Total directly related transportation operating expenses¹		1,730,418		(116,084	)		1,614,334

¹	The North Asia business segment accounts for 76% of total adjustments.

	Nine Months ended September 30, 2020
	As Reported		Adjustments			As Corrected
Revenues:
Airfreight services	$	3,237,179	$	(328,728	)	$	2,908,451
Ocean freight and ocean services		1,597,997		(7,456	)		1,590,541
Customs brokerage and other services		2,112,117		(7,551	)		2,104,566
Total revenues¹		6,947,293		(343,735	)		6,603,558

Directly related transportation operating expenses:
Airfreight services	$	2,450,931	$	(328,726	)	$	2,122,205
Ocean freight and ocean services		1,185,154		(7,458	)		1,177,696
Customs brokerage and other services		1,212,102		(7,551	)		1,204,551
Total directly related transportation operating expenses¹		4,848,187		(343,735	)		4,504,452

¹	The North Asia business segment accounts for 76% of total adjustments.