2015 Q2 Form 10-Q Financial Statement

#000103797615000054 Filed on August 06, 2015

View on sec.gov

Income Statement

Concept 2015 Q2 2014 Q2
Revenue $1.374B $1.277B
YoY Change 7.54% 29.09%
Cost Of Revenue
YoY Change
Gross Profit
YoY Change
Gross Profit Margin
Selling, General & Admin $1.243B $1.157B
YoY Change 7.42% 29.05%
% of Gross Profit
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $25.50M $22.80M
YoY Change 11.84% 12.87%
% of Gross Profit
Operating Expenses $1.271B $1.186B
YoY Change 7.17% 28.36%
Operating Profit $103.0M $91.70M
YoY Change 12.32% 39.32%
Interest Expense $7.558M $7.664M
YoY Change -1.38% -15.31%
% of Operating Profit 7.34% 8.36%
Other Income/Expense, Net
YoY Change
Pretax Income $122.5M $96.48M
YoY Change 26.97% 46.52%
Income Tax $31.10M $24.12M
% Of Pretax Income 25.39% 25.0%
Net Earnings $90.30M $71.94M
YoY Change 25.52% 54.61%
Net Earnings / Revenue 6.57% 5.63%
Basic Earnings Per Share $2.01 $1.61
Diluted Earnings Per Share $1.98 $1.58
COMMON SHARES
Basic Shares Outstanding 44.87M shares 44.59M shares
Diluted Shares Outstanding 45.44M shares 45.28M shares

Balance Sheet

Concept 2015 Q2 2014 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $191.0M $151.0M
YoY Change 26.49% 23.77%
Cash & Equivalents $191.0M $150.7M
Short-Term Investments
Other Short-Term Assets $34.63M $9.676M
YoY Change 257.93% -17.43%
Inventory
Prepaid Expenses $71.73M $75.86M
Receivables $1.305B $1.195B
Other Receivables $251.0M $274.0M
Total Short-Term Assets $1.985B $1.834B
YoY Change 8.23% 35.2%
LONG-TERM ASSETS
Property, Plant & Equipment $363.0M $331.9M
YoY Change 9.38% 31.56%
Goodwill $1.933B $1.946B
YoY Change -0.67% 5.96%
Intangibles $38.40M $44.15M
YoY Change -13.02% 6.78%
Long-Term Investments $333.0M $296.0M
YoY Change 12.5% 11.7%
Other Assets $61.96M $192.7M
YoY Change -67.85% 22.12%
Total Long-Term Assets $3.058B $2.942B
YoY Change 3.94% 4.4%
TOTAL ASSETS
Total Short-Term Assets $1.985B $1.834B
Total Long-Term Assets $3.058B $2.942B
Total Assets $5.043B $4.776B
YoY Change 5.59% 14.41%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $576.0M $492.0M
YoY Change 17.07% 22.69%
Accrued Expenses $663.0M $549.0M
YoY Change 20.77% 33.9%
Deferred Revenue
YoY Change
Short-Term Debt $22.15M $24.74M
YoY Change -10.46% -51.23%
Long-Term Debt Due $22.00M $25.00M
YoY Change -12.0% -50.98%
Total Short-Term Liabilities $1.623B $1.450B
YoY Change 11.97% 17.16%
LONG-TERM LIABILITIES
Long-Term Debt $605.0M $685.0M
YoY Change -11.68% -9.15%
Other Long-Term Liabilities $114.5M $97.47M
YoY Change 17.48% 56.53%
Total Long-Term Liabilities $114.5M $97.47M
YoY Change 17.48% 56.53%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.623B $1.450B
Total Long-Term Liabilities $114.5M $97.47M
Total Liabilities $2.548B $2.436B
YoY Change 4.63% 8.66%
SHAREHOLDERS EQUITY
Retained Earnings $1.751B $1.344B
YoY Change 30.25% 26.01%
Common Stock $974.6M $958.2M
YoY Change 1.71% 1.28%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $2.465B $2.310B
YoY Change
Total Liabilities & Shareholders Equity $5.043B $4.776B
YoY Change 5.59% 14.41%

Cashflow Statement

Concept 2015 Q2 2014 Q2
OPERATING ACTIVITIES
Net Income $90.30M $71.94M
YoY Change 25.52% 54.61%
Depreciation, Depletion And Amortization $25.50M $22.80M
YoY Change 11.84% 12.87%
Cash From Operating Activities $120.9M $116.2M
YoY Change 4.04% 104.22%
INVESTING ACTIVITIES
Capital Expenditures -$26.20M -$34.30M
YoY Change -23.62% 96.0%
Acquisitions
YoY Change
Other Investing Activities -$45.10M -$10.20M
YoY Change 342.16% -58.2%
Cash From Investing Activities -$71.20M -$44.60M
YoY Change 59.64% 6.19%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -57.80M -61.80M
YoY Change -6.47% 133.21%
NET CHANGE
Cash From Operating Activities 120.9M 116.2M
Cash From Investing Activities -71.20M -44.60M
Cash From Financing Activities -57.80M -61.80M
Net Change In Cash -8.100M 9.800M
YoY Change -182.65% -184.48%
FREE CASH FLOW
Cash From Operating Activities $120.9M $116.2M
Capital Expenditures -$26.20M -$34.30M
Free Cash Flow $147.1M $150.5M
YoY Change -2.26% 102.28%

Facts In Submission

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CY2014Q2 us-gaap Defined Benefit Plan Service Cost
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1000000 USD
us-gaap Defined Benefit Plan Service Cost
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1900000 USD
CY2015Q2 us-gaap Defined Benefit Plan Service Cost
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1300000 USD
us-gaap Defined Benefit Plan Service Cost
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2600000 USD
CY2014Q2 us-gaap Depreciation And Amortization
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22780000 USD
us-gaap Depreciation And Amortization
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45191000 USD
CY2015Q2 us-gaap Depreciation And Amortization
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25495000 USD
us-gaap Depreciation And Amortization
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CY2014Q2 us-gaap Dividends Share Based Compensation
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us-gaap Dividends Share Based Compensation
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176000 USD
CY2015Q2 us-gaap Dividends Share Based Compensation
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163000 USD
us-gaap Dividends Share Based Compensation
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163000 USD
CY2014Q2 us-gaap Earnings Per Share Basic
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1.61
us-gaap Earnings Per Share Basic
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1.97
CY2015Q2 us-gaap Earnings Per Share Basic
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2.01
us-gaap Earnings Per Share Basic
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2.94
CY2014Q2 us-gaap Earnings Per Share Diluted
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1.58
us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
1.94
CY2015Q2 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
1.98
us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
2.91
us-gaap Effect Of Exchange Rate On Cash And Cash Equivalents
EffectOfExchangeRateOnCashAndCashEquivalents
603000 USD
us-gaap Effect Of Exchange Rate On Cash And Cash Equivalents
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-7841000 USD
CY2014Q4 us-gaap Employee Related Liabilities Current
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CY2015Q2 us-gaap Employee Related Liabilities Current
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662865000 USD
us-gaap Equity Method Investment Dividends Or Distributions
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9627000 USD
us-gaap Equity Method Investment Dividends Or Distributions
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us-gaap Excess Tax Benefit From Share Based Compensation Financing Activities
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3559000 USD
us-gaap Excess Tax Benefit From Share Based Compensation Financing Activities
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1703000 USD
us-gaap Excess Tax Benefit From Share Based Compensation Operating Activities
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3559000 USD
us-gaap Excess Tax Benefit From Share Based Compensation Operating Activities
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1703000 USD
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124920000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Accumulated Amortization
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129377000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense After Year Five
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600000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense Next Twelve Months
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7700000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense Remainder Of Fiscal Year
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6900000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense Year Five
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2400000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense Year Four
FiniteLivedIntangibleAssetsAmortizationExpenseYearFour
2700000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense Year Three
FiniteLivedIntangibleAssetsAmortizationExpenseYearThree
4600000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Amortization Expense Year Two
FiniteLivedIntangibleAssetsAmortizationExpenseYearTwo
6900000 USD
CY2015Q2 us-gaap Finite Lived Intangible Assets Net
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31800000 USD
CY2014Q2 us-gaap Foreign Currency Transaction Gain Loss Unrealized
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3500000 USD
CY2015Q2 us-gaap Foreign Currency Transaction Gain Loss Unrealized
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3600000 USD
us-gaap Gain Loss On Disposition Of Assets
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0 USD
us-gaap Gain Loss On Disposition Of Assets
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871000 USD
CY2014Q4 us-gaap Goodwill
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CY2015Q2 us-gaap Goodwill
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us-gaap Goodwill Translation Adjustments
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-18600000 USD
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82600000 USD
us-gaap Impairment Of Real Estate
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800000 USD
us-gaap Impairment Of Real Estate
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4200000 USD
CY2014Q2 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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83483000 USD
CY2015Q2 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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122533000 USD
us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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180536000 USD
CY2014Q2 us-gaap Income Loss From Equity Method Investments
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12491000 USD
us-gaap Income Loss From Equity Method Investments
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21393000 USD
CY2015Q2 us-gaap Income Loss From Equity Method Investments
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27128000 USD
us-gaap Income Loss From Equity Method Investments
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38511000 USD
CY2014Q2 us-gaap Income Tax Expense Benefit
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24121000 USD
us-gaap Income Tax Expense Benefit
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CY2015Q2 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
31123000 USD
us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
45856000 USD
us-gaap Income Taxes Paid Net
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us-gaap Income Taxes Paid Net
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us-gaap Increase Decrease In Accounts Payable And Accrued Liabilities
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us-gaap Increase Decrease In Deferred Income Taxes
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-37784000 USD
us-gaap Increase Decrease In Deferred Income Taxes
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7979000 USD
us-gaap Increase Decrease In Prepaid Deferred Expense And Other Assets
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31226000 USD
us-gaap Increase Decrease In Prepaid Deferred Expense And Other Assets
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28065000 USD
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us-gaap Increase Decrease In Receivables
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23839000 USD
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38841000 USD
CY2015Q2 us-gaap Intangible Assets Net Excluding Goodwill
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us-gaap Interest Expense
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us-gaap Interest Expense
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13596000 USD
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us-gaap Interest Paid
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CY2014Q2 us-gaap Investments Fair Value Disclosure
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88600000 USD
CY2014Q4 us-gaap Investments Fair Value Disclosure
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113600000 USD
CY2015Q2 us-gaap Investments Fair Value Disclosure
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139000000 USD
CY2014Q4 us-gaap Investments In Affiliates Subsidiaries Associates And Joint Ventures
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297142000 USD
CY2015Q2 us-gaap Investments In Affiliates Subsidiaries Associates And Joint Ventures
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333016000 USD
CY2014Q4 us-gaap Investments In Affiliates Subsidiaries Associates And Joint Ventures Fair Value Disclosure
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113602000 USD
CY2015Q2 us-gaap Investments In Affiliates Subsidiaries Associates And Joint Ventures Fair Value Disclosure
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138960000 USD
CY2014Q2 us-gaap Labor And Related Expense
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us-gaap Labor And Related Expense
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1398563000 USD
CY2015Q2 us-gaap Labor And Related Expense
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us-gaap Labor And Related Expense
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1562975000 USD
CY2014Q4 us-gaap Letters Of Credit Outstanding Amount
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CY2015Q2 us-gaap Letters Of Credit Outstanding Amount
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23000000 USD
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CY2015Q2 us-gaap Liabilities
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2548441000 USD
CY2014Q4 us-gaap Liabilities And Stockholders Equity
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5075336000 USD
CY2015Q2 us-gaap Liabilities And Stockholders Equity
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2047011000 USD
CY2015Q2 us-gaap Liabilities Current
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CY2014Q4 us-gaap Loans Receivable Mortgage Warehouse Lending
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32200000 USD
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85749000 USD
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CY2015Q2 us-gaap Long Term Debt
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CY2014Q4 us-gaap Long Term Debt Fair Value
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285300000 USD
CY2015Q2 us-gaap Long Term Debt Fair Value
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281700000 USD
CY2014Q4 us-gaap Long Term Line Of Credit
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CY2015Q2 us-gaap Long Term Line Of Credit
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CY2013Q4 us-gaap Loss Contingency Accrual At Carrying Value
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6200000 USD
CY2014Q2 us-gaap Loss Contingency Accrual At Carrying Value
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8500000 USD
CY2014Q4 us-gaap Loss Contingency Accrual At Carrying Value
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9200000 USD
CY2015Q2 us-gaap Loss Contingency Accrual At Carrying Value
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11900000 USD
us-gaap Loss Contingency Accrual Carrying Value Payments
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us-gaap Loss Contingency Accrual Carrying Value Payments
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0 USD
us-gaap Loss Contingency Accrual Provision
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3100000 USD
us-gaap Loss Contingency Accrual Provision
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2500000 USD
CY2014Q4 us-gaap Minority Interest
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CY2015Q2 us-gaap Minority Interest
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20415000 USD
us-gaap Minority Interest Change In Redemption Value
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us-gaap Minority Interest Decrease From Redemptions
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0 USD
us-gaap Minority Interest Decrease From Redemptions
MinorityInterestDecreaseFromRedemptions
-990000 USD
us-gaap Minority Interest Period Increase Decrease
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us-gaap Net Cash Provided By Used In Financing Activities
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228252000 USD
us-gaap Net Cash Provided By Used In Financing Activities
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255620000 USD
us-gaap Net Cash Provided By Used In Investing Activities
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us-gaap Net Cash Provided By Used In Investing Activities
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us-gaap Net Cash Provided By Used In Operating Activities
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us-gaap Net Cash Provided By Used In Operating Activities
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CY2014Q2 us-gaap Net Income Loss
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us-gaap Net Income Loss
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87844000 USD
CY2015Q2 us-gaap Net Income Loss
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90311000 USD
us-gaap Net Income Loss
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132205000 USD
CY2014Q2 us-gaap Net Income Loss Attributable To Noncontrolling Interest
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420000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
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663000 USD
CY2015Q2 us-gaap Net Income Loss Attributable To Noncontrolling Interest
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1099000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
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2475000 USD
us-gaap Net Income Loss Attributable To Redeemable Noncontrolling Interest
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234000 USD
CY2014Q2 us-gaap Net Income Loss Available To Common Stockholders Basic
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71766000 USD
us-gaap Net Income Loss Available To Common Stockholders Basic
NetIncomeLossAvailableToCommonStockholdersBasic
87668000 USD
CY2015Q2 us-gaap Net Income Loss Available To Common Stockholders Basic
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90148000 USD
us-gaap Net Income Loss Available To Common Stockholders Basic
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132042000 USD
us-gaap Net Income Loss Including Portion Attributable To Nonredeemable Noncontrolling Interest
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218003000 USD
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us-gaap Operating Expenses
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us-gaap Operating Expenses
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us-gaap Operating Income Loss
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76390000 USD
CY2015Q2 us-gaap Operating Income Loss
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102963000 USD
us-gaap Operating Income Loss
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us-gaap Other Amortization Of Deferred Charges
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us-gaap Other Amortization Of Deferred Charges
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CY2015Q2 us-gaap Other Assets Noncurrent
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0 USD
us-gaap Other Comprehensive Income Defined Benefit Plans Adjustment Net Of Tax Portion Attributable To Parent
OtherComprehensiveIncomeDefinedBenefitPlansAdjustmentNetOfTaxPortionAttributableToParent
0 USD
CY2015Q2 us-gaap Other Comprehensive Income Defined Benefit Plans Adjustment Net Of Tax Portion Attributable To Parent
OtherComprehensiveIncomeDefinedBenefitPlansAdjustmentNetOfTaxPortionAttributableToParent
0 USD
us-gaap Other Comprehensive Income Defined Benefit Plans Adjustment Net Of Tax Portion Attributable To Parent
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25134000 USD
us-gaap Other Comprehensive Income Foreign Currency Transaction And Translation Adjustment Net Of Tax Portion Attributable To Parent
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38952000 USD
CY2015Q2 us-gaap Other Comprehensive Income Foreign Currency Transaction And Translation Adjustment Net Of Tax Portion Attributable To Parent
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53688000 USD
us-gaap Other Comprehensive Income Foreign Currency Transaction And Translation Adjustment Net Of Tax Portion Attributable To Parent
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CY2014Q2 us-gaap Other General And Administrative Expense
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us-gaap Other General And Administrative Expense
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CY2015Q2 us-gaap Other General And Administrative Expense
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us-gaap Other General And Administrative Expense
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CY2015Q2 us-gaap Other Liabilities Noncurrent
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us-gaap Payments For Previous Acquisition
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us-gaap Payments For Previous Acquisition
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us-gaap Payments For Proceeds From Productive Assets
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45350000 USD
us-gaap Payments For Repurchase Of Redeemable Noncontrolling Interest
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0 USD
us-gaap Payments For Repurchase Of Redeemable Noncontrolling Interest
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us-gaap Payments For Restructuring
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6400000 USD
us-gaap Payments For Restructuring
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5900000 USD
us-gaap Payments Of Debt Issuance Costs
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us-gaap Payments Of Debt Issuance Costs
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us-gaap Payments Related To Tax Withholding For Share Based Compensation
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us-gaap Payments Related To Tax Withholding For Share Based Compensation
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us-gaap Payments To Acquire Interest In Joint Venture
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18585000 USD
us-gaap Payments To Acquire Interest In Joint Venture
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us-gaap Proceeds From Lines Of Credit
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20307000 USD
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0 USD
us-gaap Proceeds From Sales Of Assets Investing Activities
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6813000 USD
CY2014Q2 us-gaap Profit Loss
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us-gaap Profit Loss
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us-gaap Profit Loss
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us-gaap Provision For Doubtful Accounts
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us-gaap Provision For Doubtful Accounts
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CY2015Q2 us-gaap Redeemable Noncontrolling Interest Equity Carrying Amount
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177000 USD
us-gaap Repayments Of Lines Of Credit
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us-gaap Repayments Of Lines Of Credit
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2175000 USD
us-gaap Repayments Of Long Term Capital Lease Obligations
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2019000 USD
us-gaap Restructuring Charges
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6900000 USD
us-gaap Restructuring Charges
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2600000 USD
CY2014Q2 us-gaap Restructuring Costs And Asset Impairment Charges
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5458000 USD
us-gaap Restructuring Costs And Asset Impairment Charges
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41416000 USD
CY2015Q2 us-gaap Restructuring Costs And Asset Impairment Charges
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1832000 USD
us-gaap Restructuring Costs And Asset Impairment Charges
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2648000 USD
CY2013Q4 us-gaap Restructuring Reserve
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10500000 USD
CY2014Q2 us-gaap Restructuring Reserve
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11000000 USD
CY2014Q4 us-gaap Restructuring Reserve
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7600000 USD
CY2015Q2 us-gaap Restructuring Reserve
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4300000 USD
CY2014Q4 us-gaap Retained Earnings Accumulated Deficit
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1751018000 USD
CY2014Q2 us-gaap Revenues
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us-gaap Revenues
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2314646000 USD
CY2015Q2 us-gaap Revenues
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1373475000 USD
us-gaap Revenues
Revenues
2576986000 USD
CY2014Q4 us-gaap Senior Long Term Notes
SeniorLongTermNotes
275000000 USD
CY2015Q2 us-gaap Senior Long Term Notes
SeniorLongTermNotes
275000000 USD
CY2014Q4 us-gaap Short Term Borrowings
ShortTermBorrowings
19623000 USD
CY2015Q2 us-gaap Short Term Borrowings
ShortTermBorrowings
22150000 USD
us-gaap Stock Issued During Period Value Share Based Compensation
StockIssuedDuringPeriodValueShareBasedCompensation
456000 USD
CY2014Q4 us-gaap Stockholders Equity
StockholdersEquity
2386797000 USD
CY2015Q2 us-gaap Stockholders Equity
StockholdersEquity
2464540000 USD
CY2014Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
2409120000 USD
CY2015Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
2484955000 USD
us-gaap Unrealized Gain Loss On Investments
UnrealizedGainLossOnInvestments
2700000 USD
us-gaap Unrealized Gain Loss On Investments
UnrealizedGainLossOnInvestments
7000000 USD
CY2014Q4 us-gaap Warehouse Agreement Borrowings
WarehouseAgreementBorrowings
83312000 USD
CY2015Q2 us-gaap Warehouse Agreement Borrowings
WarehouseAgreementBorrowings
32200000 USD
CY2014Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
45278494 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
45220082 shares
CY2015Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
45434585 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
45393438 shares
CY2014Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
44586095 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
44550154 shares
CY2015Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
44868979 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
44856374 shares
us-gaap Revenue Recognition Accounting Policy Gross And Net Revenue Disclosure
RevenueRecognitionAccountingPolicyGrossAndNetRevenueDisclosure
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Gross and Net Accounting:</font><font style="font-family:inherit;font-size:10pt;"> We follow the guidance of FASB Accounting Standards Codification ("ASC") 605-45, "Principal and Agent Considerations," when accounting for reimbursements received from clients. In certain of our businesses, primarily those involving management services, our clients reimburse us for expenses incurred on their behalf. We base the treatment of reimbursable expenses for financial reporting purposes upon the fee structure of the underlying contract. Accordingly, we report a contract that provides for fixed fees, fully inclusive of all personnel and other recoverable expenses, on a gross basis. When accounting on a gross basis, our reported revenue comprises the entire amount billed to our client and our reported expenses include all costs associated with the client. Certain contractual arrangements in our project and development services, including fit-out business activities and our facility management services, tend to have characteristics that result in accounting on a gross basis. In Note 4, Business Segments, for client assignments in property and facility management and in project and development services that are accounted for on a gross basis, we identify the gross contract costs, including vendor and subcontract costs ("gross contract costs"), and present separately their impact on both revenue and operating expenses in our RES segments. We exclude these gross contract costs from revenue and operating expenses in determining "fee revenue" and "fee-based operating expenses" in our segment presentation.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We account for a contract on a net basis when the fee structure is comprised of at least two distinct elements, namely (1) a fixed management fee and (2) a separate component that allows for scheduled reimbursable personnel costs or other expenses to be billed directly to the client. When accounting on a net basis, we include the fixed management fee in reported revenue and net the reimbursement against expenses. We base this accounting on the following factors, which define us as an agent rather than a principal:</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:29px;" rowspan="1" colspan="1"></td><td rowspan="1" colspan="1"></td></tr><tr><td style="vertical-align:top" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;padding-left:5px;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#8226;</font></div></td><td style="vertical-align:top;" rowspan="1" colspan="1"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The property owner or client, with ultimate approval rights relating to the employment and compensation of on-site personnel, and bearing all of the economic costs of such personnel, is determined to be the primary obligor in the arrangement;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:12px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:29px;" rowspan="1" colspan="1"></td><td rowspan="1" colspan="1"></td></tr><tr><td style="vertical-align:top" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;padding-left:5px;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#8226;</font></div></td><td style="vertical-align:top;" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Reimbursement to JLL is generally completed simultaneously with payment of payroll or soon thereafter;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:12px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:29px;" rowspan="1" colspan="1"></td><td rowspan="1" colspan="1"></td></tr><tr><td style="vertical-align:top" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;padding-left:5px;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#8226;</font></div></td><td style="vertical-align:top;" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The property owner is contractually obligated to fund all operating costs of the property from existing cash flow or direct funding from its building operating account and JLL bears little or no credit risk; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:12px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:29px;" rowspan="1" colspan="1"></td><td rowspan="1" colspan="1"></td></tr><tr><td style="vertical-align:top" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;padding-left:5px;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#8226;</font></div></td><td style="vertical-align:top;" rowspan="1" colspan="1"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">JLL generally earns no margin on the reimbursement aspect of the arrangement, obtaining reimbursement only for actual costs incurred.</font></div></td></tr></table><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We account for the majority of our service contracts on a net basis. The reimbursable costs associated with these net contracts aggregated approximately </font><font style="font-family:inherit;font-size:10pt;">$416.9 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$425.6 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">three months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively, and </font><font style="font-family:inherit;font-size:10pt;">$965.6 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$904.5 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">six months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively. The presentation of expenses pursuant to these arrangements under either a gross or net basis has no impact on operating income, net income or cash flows. </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Contracts accounted for on a gross basis resulted in certain costs reflected in revenue and operating expenses (gross contract costs) of </font><font style="font-family:inherit;font-size:10pt;">$191.7 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$191.2 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">three months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively, and </font><font style="font-family:inherit;font-size:10pt;">$366.1 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$350.9 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">six months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively. </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div></div>
us-gaap Revenue Recognition Percentage Of Completion Method
RevenueRecognitionPercentageOfCompletionMethod
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We recognize project and development management and construction management fees by applying the percentage of completion method of accounting. The efforts expended method is used to determine the extent of progress towards completion for project and development management fees, and the costs incurred to total estimated costs method is used for construction management fees.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Certain construction management fees, which are gross construction services revenue reported net of subcontract costs, were </font><font style="font-family:inherit;font-size:10pt;">$1.3 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$1.2 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">three months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively, and </font><font style="font-family:inherit;font-size:10pt;">$2.0 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$2.4 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">six months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively. Gross construction services revenue totaled </font><font style="font-family:inherit;font-size:10pt;">$21.8 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$23.7 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">three months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively, and </font><font style="font-family:inherit;font-size:10pt;">$39.0 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$51.2 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">six months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively. Subcontract costs totaled </font><font style="font-family:inherit;font-size:10pt;">$20.5 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$22.5 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">three months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively, and </font><font style="font-family:inherit;font-size:10pt;">$37.0 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$48.8 million</font><font style="font-family:inherit;font-size:10pt;"> for the </font><font style="font-family:inherit;font-size:10pt;">six months ended June 30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2014</font><font style="font-family:inherit;font-size:10pt;">, respectively.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We included costs in excess of billings on uncompleted construction contracts of </font><font style="font-family:inherit;font-size:10pt;">$3.3 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$3.4 million</font><font style="font-family:inherit;font-size:10pt;"> in Trade receivables, and billings in excess of costs on uncompleted construction contracts of </font><font style="font-family:inherit;font-size:10pt;">$5.1 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$7.9 million</font><font style="font-family:inherit;font-size:10pt;">, in Deferred income, as of </font><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">June&#160;30, 2015</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">December&#160;31, 2014</font><font style="font-family:inherit;font-size:10pt;">, respectively.</font></div></div>
us-gaap Revenue Recognition Services Commissions
RevenueRecognitionServicesCommissions
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We recognize transaction commissions related to leasing services and capital markets services as revenue when we provide the related services unless future contingencies exist.</font></div></div>
us-gaap Revenue Recognition Services Management Fees
RevenueRecognitionServicesManagementFees
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Advisory and management fees related to property and facility management services, valuation services, corporate property services, consulting services and investment management are recognized in the period in which we perform the related services.</font></div></div>

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