Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2018

The VIEs in Brazil and Mexico comprise several not-for-profit foundations that have insignificant revenues and operating expenses. Selected Consolidated Statements of Operations information for VIEs that are included in continuing operations was as follows, net of the charges related to the above-described contractual arrangements:



	For the three months ended September 30,						For the nine months ended September 30,
	2018			2017			2018			2017
Selected Statements of Operations information:
Revenues, by segment:
Brazil	$	—		$	11		$	—		$	57
Mexico	4			—			89			—
Andean	119,884			114,494			325,423			300,385
Revenues	119,888			114,505			325,512			300,442

Depreciation and amortization	6,163			6,626			19,398			20,397

Operating income (loss), by segment:
Brazil	(16		)	(23		)	(56		)	(30		)
Mexico	(121		)	(163		)	(349		)	(516		)
Andean	12,954			6,613			7,714			(3,545		)
Operating income (loss)	12,817			6,427			7,309			(4,091		)

Net income	18,812			10,928			22,860			8,308
Net income attributable to Laureate Education, Inc.	18,812			10,928			22,860			8,308

The following table reconciles the Net income (loss) attributable to Laureate Education, Inc. as presented in the table above, to the amounts in our Consolidated Statements of Operations:



	For the three months ended September 30,						For the nine months ended September 30,
	2018			2017			2018		2017
Net (loss) income attributable to Laureate Education, Inc.:
Variable interest entities	$	18,812		$	10,928		$	22,860	$	8,308
Other operations	21,564			40,366			241,920		278,804
Corporate and eliminations	(135,165		)	(149,253		)	33,719		(391,492		)
Net (loss) income attributable to Laureate Education, Inc.	$	(94,789	)	$	(97,959	)	$	298,499	$	(104,380	)

The following table presents selected assets and liabilities of the consolidated VIEs. Except for Goodwill, the assets in the table below include the assets that can be used only to settle the obligations for the VIEs. The liabilities in the table are liabilities for which the creditors of the VIEs do not have recourse to the general credit of Laureate.

Selected Consolidated Balance Sheet amounts for these VIEs were as follows:



	September 30, 2018				December 31, 2017
	VIE		Consolidated		VIE		Consolidated
Balance Sheets data:
Cash and cash equivalents	$	146,927	$	392,348	$	100,971	$	320,567
Current assets held for sale	170,886		346,702		170,229		324,668
Other current assets	324,320		715,437		136,115		643,459
Total current assets	642,133		1,454,487		407,315		1,288,694

Goodwill	174,600		1,709,586		183,812		1,828,365
Tradenames	69,107		1,130,186		74,484		1,167,302
Other intangible assets, net	—		25,455		—		35,779
Long-term assets held for sale	151,310		1,007,344		369,375		1,224,672
Other long-term assets	297,720		1,663,478		384,593		1,846,473
Total assets	1,334,870		6,990,536		1,419,579		7,391,285

Current liabilities held for sale	114,569		394,229		183,166		451,569
Other current liabilities	200,291		1,143,036		157,981		923,020
Long-term liabilities held for sale	38,696		353,338		84,760		405,747
Long-term debt and other long-term liabilities	28,824		3,115,595		23,654		3,609,670
Total liabilities	382,380		5,006,198		449,561		5,390,006

Total stockholders' equity	952,490		1,971,667		970,018		1,587,282
Total stockholders' equity attributable to Laureate Education, Inc.	952,317		1,983,336		948,966		1,575,164

Schedule of balances of the allowance for doubtful accounts

The reconciliations of the beginning and ending balances of the Allowance for doubtful accounts were as follows:



For the nine months ended September 30,	2018			2017
Balance at beginning of period	$	182,965		$	169,014
Additions: charges to bad debt expense	74,969			79,408
Deductions ^(a)	(90,494		)	(68,155		)
Balance at end of period	$	167,440		$	180,267

^(a) Deductions includes accounts receivable written off against the allowance (net of recoveries), reclassifications, and foreign

currency translation. The beginning and ending balances of the Allowance for doubtful accounts include the current

portion, as shown on the face of Consolidated Balance Sheets, in addition to the noncurrent portion that is included in

Notes receivable, net on the Consolidated Balance Sheets.

Laureate’s financing receivables balances were as follows:



	September 30, 2018			December 31, 2017
Financing receivables	$	31,506		$	20,380
Allowance for doubtful accounts	(5,876		)	(6,472		)
Financing receivables, net of allowances	$	25,630		$	13,908

Schedule of adoption of new accounting standard update

In accordance with the requirements under Topic 606, the impact of adoption on our Consolidated Statement of Operations and Consolidated Balance Sheet was as follows:



	For the nine months ended September 30, 2018
	As Reported			Balances Without Adoption of ASC 606			Effect of Change Higher/(Lower)
Statement of Operations data:
Revenues	$	2,436,514		$	2,433,937		$	2,577

Costs and Expenses:
Direct costs	2,081,125			2,084,654			(3,529		)
Income tax expense	(65,822		)	(65,786		)	(36		)

Net income	298,814			292,743			6,071



	As of September 30, 2018
	As Reported			Balances Without Adoption of ASC 606			Effect of Change Higher/(Lower)
Balance Sheet data:
Assets:
Deferred costs, net	$	65,896		$	60,949		$	4,947

Liabilities:
Deferred revenue and student deposits	465,290			467,867			(2,577		)
Deferred income taxes	257,083			257,047			36

Equity:
Accumulated deficit	(643,407		)	(650,895		)	7,488

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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