Leases

9 Months Ended

Mar. 31, 2020

During the first quarter of the fiscal year ending June 30, 2020 ("fiscal 2020"), the Company adopted ASC 842 using the optional transition method under which financial results reported in periods prior were not adjusted and continue to be reported in accordance with historic accounting under ASC 840 - Leases.

The Company elected the following practical expedients permitted under the lease standard:

•The Company did not reassess prior conclusions about lease identification, lease classification or initial direct costs, and did not use hindsight for leases existing at adoption date.

•The Company did not record leases with an initial term of 12 months or less on the consolidated balance sheet but continues to expense them on a straight-line basis over the lease term.

•The Company elected to combine lease and non-lease components for our facilities leases only. Non-lease components consist primarily of maintenance services.

The Company records leases on the consolidated balance sheets as operating lease ROU assets, records the current portion of operating lease liabilities within accrued expenses and other current liabilities and, separately, records long-term operating lease liabilities.

The Company has entered into operating lease agreements for facilities and equipment. The Company's leases have remaining lease terms of up to approximately eleven years. Operating lease ROU assets and operating lease liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term. The lease liabilities are measured by discounting future lease payments at the Company’s collateralized incremental borrowing rate for financing instruments of a similar term, unless the implicit rate is readily determinable. ROU assets also include adjustments related to prepaid or deferred lease payments and lease incentives. As of March 31, 2020, total operating lease ROU assets were $521.1 million, current and long-term operating lease liabilities were approximately $98.2 million and $361.2 million, respectively. The difference between total ROU assets and total lease liabilities are primarily attributable to pre-payments of our obligations and the recognition of various lease incentives.

The components of operating lease expense were as follows:


	Three Months Ended		Nine Months Ended
	March 31,		March 31,
	2020		2020
Operating lease cost	$	34.8	$	121.3
Short-term lease cost	1.6		5.6
Variable lease cost	2.9		4.9
Total operating lease cost	$	39.3	$	131.8

Information related to our operating lease ROU assets and operating lease liabilities was as follows:


	Nine Months Ended
	March 31,
	2020
Cash paid for operating lease liabilities	$	186.9
Operating lease ROU assets obtained in exchange for new operating lease liabilities	$	142.9
Weighted-average remaining lease term (in years)	6
Weighted-average discount rate	2.3		%

As of March 31, 2020, maturities of operating lease liabilities are as follows:


Three months ending June 30, 2020	$	28.2
Twelve months ending June 30, 2021	103.9
Twelve months ending June 30, 2022	89.0
Twelve months ending June 30, 2023	76.5
Twelve months ending June 30, 2024	56.4
Thereafter	139.6
Total undiscounted lease obligations	493.6
Less: Imputed interest	(34.2)
Net lease obligations	$	459.4