Commitments and Contingencies

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Loss Contingencies

Laureate is subject to legal actions arising in the ordinary course of its business. In management's opinion, we have adequate legal defenses, insurance coverage and/or accrued liabilities with respect to the eventuality of such actions. We do not believe that any settlement would have a material impact on our Consolidated Financial Statements.

Contingent Liabilities for Taxes

As of September 30, 2022 and December 31, 2021, Laureate had recorded cumulative liabilities for income tax contingencies of $124,591 and $91,585, respectively.

Other Loss Contingencies

Laureate has accrued liabilities for certain civil actions against our institutions, a portion of which existed prior to our acquisition of these entities. Laureate intends to vigorously defend against these matters. As of September 30, 2022 and December 31, 2021, approximately $10,100 and $7,200, respectively, of loss contingencies were included in Other long-term liabilities and Other current liabilities on the Consolidated Balance Sheets.

Guarantees

In connection with a loan agreement entered into by a Laureate subsidiary in Peru, all of the shares of Universidad Privada del Norte, one of our universities, were pledged to the third-party lender as a guarantee of the payment obligations under the loan.

During the first quarter of 2021, one of our Peruvian institutions issued a bank guarantee in order to appeal a preliminary tax assessment received related to tax audits of 2014 and 2015. As of September 30, 2022 and December 31, 2021, the amount of the guarantee was $5,937 and $5,885, respectively.

Letter of Credit

As of September 30, 2022 and December 31, 2021, we had approximately $9,000 and $10,700, respectively, posted as cash collateral for a letter of credit related to the Spanish tax audits. This was recorded in Continuing Operations and classified as Restricted cash on our September 30, 2022 and December 31, 2021 Consolidated Balance Sheets. The cash collateral was related to final assessments issued by the Spanish Taxing Authority (STA) in October 2018 and January 2020 to Iniciativas Culturales de España, S.L. (ICE), our former Spanish holding company. During the second quarter of 2020, ICE was migrated to the Netherlands, and its name was changed to Laureate Netherlands Holding B.V. In October 2021, the Company made a payment to the STA of approximately $9,300, in order to reduce the amount of future interest that could be incurred as the appeals process continues. Following the payment, the letter of credit was no longer required and the cash was subsequently released in October 2022.