What changed in this filing

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Item 1. Financial Statements

2020-11-06 compared with 2020-08-07 · 91 added, 71 removed, 584 unchanged (22% of the section changed)

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions, except per share data) 2020 2019 2020 2019

23 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2020 2019 2020 2019

14 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in millions, except share data in thousands) June 30, 2020 December 31, 2019

(in millions, except share data in thousands) September 30, 2020 December 31, 2019

Cash and cash equivalents $ 488 $ 496

35 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Six Months Ended

Nine Months Ended

September 30,

(in millions) 2020 2019

10 unchanged sentences

Stock-based compensation 14 19

Allowance for doubtful accounts 1 —

Changes in operating assets and liabilities:

14 unchanged sentences

Cash Flows from Financing Activities:

Proceeds from revolving credit facility 150 —

Proceeds from revolving credit facility and other loans 152 —

Payments on debt ( 41 ) ( 42 )

Payment of contingent consideration related to acquisition ( 4 ) —

Taxes paid for settlement of stock based compensation ( 3 ) ( 11 )

5 unchanged sentences

Cash, Cash Equivalents and Restricted Cash at End of period (1)

(1) Includes $ 9 million of restricted cash as of both June 30, 2020 and 2019, respectively, that were included in Other current assets on their respective Condensed Consolidated Balance Sheets.

(1) Includes $ 8 million of restricted cash as of both September 30, 2020 and 2019, respectively, that were included in Other current assets on their respective Condensed Consolidated Balance Sheets.

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

Three Months Ended June 30, 2020

Three Months Ended September 30, 2020

(in millions) Common Stock Additional Paid-in Capital Retained Earnings (Deficit) AOCL (1)

Shareholders'

Balance at March 31, 2020 $ 2 $ 3,891 $ ( 2,236 ) $ ( 437 ) $ 1,220

Cash dividends paid - preferred stock, $ 20 /share

Balance at June 30, 2020 $ 2 $ 3,896 $ ( 2,290 ) $ ( 433 ) $ 1,175

Dividends - preferred stock, $ 20 /share (2)

— — ( 2 ) — ( 2 )

4 unchanged sentences

Total Comprehensive Income (Loss), Net — — ( 7 ) 12 5

Balance at June 30, 2020 $ 2 $ 3,896 $ ( 2,290 ) $ ( 433 ) $ 1,175

Three Months Ended June 30, 2019

Balance at September 30, 2020 $ 2 $ 3,901 $ ( 2,299 ) $ ( 421 ) $ 1,183

Three Months Ended September 30, 2019

(in millions) Common Stock Additional Paid-in Capital Retained Earnings (Deficit) AOCL (1)

Shareholders'

Balance at March 31, 2019 $ 2 $ 3,879 $ ( 551 ) $ ( 403 ) $ 2,927

Cash dividends paid - preferred stock, $ 20 /share

Balance at June 30, 2019 $ 2 $ 3,886 $ ( 1,583 ) $ ( 404 ) $ 1,901

Dividends - preferred stock, $ 20 /share

— — ( 2 ) — ( 2 )

Stock option and incentive plans, net — 7 — — 7

Comprehensive Income (Loss):

2 unchanged sentences

Total Comprehensive Income (Loss), Net — — ( 16 ) ( 15 ) ( 31 )

Balance at June 30, 2019 $ 2 $ 3,886 $ ( 1,583 ) $ ( 404 ) $ 1,901

Six Months Ended June 30, 2020

Balance at September 30, 2019 $ 2 $ 3,886 $ ( 1,601 ) $ ( 419 ) $ 1,868

Nine Months Ended September 30, 2020

(in millions) Common Stock Additional Paid-in Capital Retained Earnings (Deficit) AOCL (1)

1 unchanged sentence

Balance at December 31, 2019 $ 2 $ 3,890 $ ( 2,185 ) $ ( 407 ) $ 1,300

Cash dividends paid - preferred stock, $ 40 /share

Dividends - preferred stock, $ 60 /share (2)

— — ( 7 ) — ( 7 )

4 unchanged sentences

Total Comprehensive Income (Loss), Net — — ( 107 ) ( 14 ) ( 121 )

Balance at June 30, 2020 $ 2 $ 3,896 $ ( 2,290 ) $ ( 433 ) $ 1,175

Six Months Ended June 30, 2019

Balance at September 30, 2020 $ 2 $ 3,901 $ ( 2,299 ) $ ( 421 ) $ 1,183

Nine Months Ended September 30, 2019

(in millions) Common Stock Additional Paid-in Capital Retained Earnings (Deficit) AOCL (1)

1 unchanged sentence

Balance at December 31, 2018 $ 2 $ 3,878 $ ( 233 ) $ ( 425 ) $ 3,222

Cash dividends paid - preferred stock, $ 40 /share

Dividends - preferred stock, $ 60 /share

— — ( 7 ) — ( 7 )

5 unchanged sentences

Total Comprehensive Income (Loss), Net — — ( 1,353 ) 6 ( 1,347 )

Balance at June 30, 2019 $ 2 $ 3,886 $ ( 1,583 ) $ ( 404 ) $ 1,901

Balance at September 30, 2019 $ 2 $ 3,886 $ ( 1,601 ) $ ( 419 ) $ 1,868

(1) AOCL - Accumulated other comprehensive loss.

Refer to Note 10 – Accumulated Other Comprehensive Loss for the components of AOCL.

(2) The preferred dividend for the third quarter of 2020 was accrued but unpaid as of September 30, 2020.

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

20 unchanged sentences

Use of Estimates

Preparation of financial statements in conformity with U.S GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes.

Preparation of financial statements in conformity with U.S.

GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes.

Actual results could differ materially from these estimates.

1 unchanged sentence

We base our estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

As of June 30, 2020, the impact of the outbreak of COVID-19 pandemic continues to unfold.

As of September 30, 2020, the impact of the outbreak of COVID-19 pandemic continues to unfold.

As a result, many of our estimates and assumptions required increased judgment and carry a higher degree of variability and volatility.

37 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2020 2019 2020 2019

32 unchanged sentences

The following table provides information about the balances of the Company's contract assets, unearned income and receivables from contracts with customers:

(in millions) June 30, 2020 December 31, 2019

(in millions) September 30, 2020 December 31, 2019

Contract Assets (Unearned Income)

8 unchanged sentences

(2) Presented in Other long-term liabilities in the Condensed Consolidated Balance Sheets.

Revenues of $ 22 million and $ 64 million were recognized during the three and six months ended June 30, 2020, respectively, related to the Company's unearned income at December 31, 2019.

Revenues of $ 28 million and $ 81 million were recognized during the three and six months ended June 30, 2019, respectively, related to the Company's unearned income at December 31, 2018.

Revenues of $ 20 million and $ 84 million were recognized during the three and nine months ended September 30, 2020, respectively, related to the Company's unearned income at December 31, 2019.

Revenues of $ 16 million and $ 97 million were recognized during the three and nine months ended September 30, 2019, respectively, related to the Company's unearned income at December 31, 2018.

Transaction Price Allocated to the Remaining Performance Obligations

Estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially satisfied at June 30, 2020 was approximately $ 1.6 billion.

Estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially satisfied at September 30, 2020 was approximately $ 1.5 billion.

The Company expects to recognize approximately 70 % of this revenue over the next two years and the remainder thereafter.

Note 4 – Segment Reporting

Our reportable segments correspond to how we organize and manage the business, as defined by our CEO, who is also our Chief Operating Decision Maker (CODM), and are aligned to the industries in which our clients operate.

Our reportable segments correspond to how we organize and manage the business, as defined by our Chief Executive Officer, who is also our Chief Operating Decision Maker (CODM), and are aligned to the industries in which our clients operate.

Our segments involve the delivery of business process services and include service arrangements where we manage a customer's business activity or process.

During the first quarter of 2020, we realigned our sales organization and certain shared IT and other allocated functions to reflect how we currently manage our business.

All prior periods presented have been revised to reflect this change in costs structure.

Our financial performance is based on Segment Profit / (Loss) and Segment Adjusted EBITDA for our three reportable segments (Commercial Industries, Government Services and Transportation), Other and Shared IT / Infrastructure & Corporate Costs.

In the first quarter of 2020, we realigned our sales organization and certain shared IT and other allocated functions to reflect how we currently manage our business.

In the third quarter of 2020, in order to provide greater visibility into the profitability of our segments, certain costs that were previously included in the Shared IT/Infrastructure and Corporate Costs (now referred to as Unallocated Costs) are being allocated to each of the reportable segments.

All prior periods presented have been recast to reflect these changes.

Our financial performance is based on Segment Profit/(Loss) and Segment Adjusted EBITDA for our three reportable segments (Commercial Industries, Government Services and Transportation), Other and Unallocated Costs.

Our CODM does not evaluate operating segments using discrete asset information.

11 unchanged sentences

Other includes our divestitures and our Student Loan business, which the Company exited in the third quarter of 2018.

Shared IT / Infrastructure & Corporate Costs includes both normal ongoing IT infrastructure and enterprise application costs and costs related to modernization of a significant portion of our infrastructure with new systems and processes.

It also includes costs related to corporate overhead functions and shared real estate costs.

These costs are not allocated to the reportable segments.

Unallocated Costs includes IT infrastructure costs that are shared by multiple reportable segments, enterprise application costs and certain corporate overhead expenses not directly attributable or allocated to our reportable segments.

Selected financial information for our reportable segments was as follows:

Three Months Ended

(in millions) Commercial Industries Government Services Transportation Other Shared IT / Infrastructure & Corporate Costs Total

September 30,

(in millions) Commercial Industries Government Services Transportation Other Unallocated Costs Total

2020 Divestitures Other

7 unchanged sentences

Adjusted EBITDA $ 87 $ 77 $ 34 $ — $ — $ ( 71 ) $ 127

Six Months Ended

(in millions) Commercial Industries Government Services Transportation Other Shared IT / Infrastructure & Corporate Costs Total

Nine Months Ended

September 30,

(in millions) Commercial Industries Government Services Transportation Other Unallocated Costs Total

2020 Divestitures Other

9 unchanged sentences

(in millions) Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Segment Profit (Loss) Reconciliation to Pre-tax Income (Loss) 2020 2019 2020 2019

17 unchanged sentences

The implementation of the Company's strategic transformation program and various productivity initiatives have reduced the Company's real estate footprint across all geographies and segments resulting in lease terminations, asset impairments and other related costs.

Also included in Restructuring and related costs in the table below are incremental, non-recurring costs related to the consolidation of the Company's data centers, which totaled $ 6 million and $ 9 million for the three months ended June 30, 2020 and 2019, respectively, and $ 8 million and $ 18 million for the six months ended June 30, 2020 and 2019, respectively.

Also included in Restructuring and related costs in the table below are incremental, non-recurring costs related to the consolidation of the Company's data centers, which totaled $ 8 million and $ 0 million for the three months ended September 30, 2020 and 2019, respectively, and $ 16 million and $ 18 million for the nine months ended September 30, 2020 and 2019, respectively.

Management continues to evaluate the Company's business, and in the future, there may be additional provisions for new plan initiatives and/or changes in previously recorded estimates as payments are made, or actions are completed.

1 unchanged sentence

In those geographies where we have either a formal severance plan or a history of consistently providing severance benefits representing a substantive plan, we recognize employee severance costs when they are both probable and reasonably estimable.

A summary of the Company's restructuring program activity during the six months ended June 30, 2020 and 2019 was as follows:

Asset impairment costs related to the reduction of our real estate footprint include impairment of operating lease right-of-use (ROU) assets and associated leasehold improvements.

A summary of the Company's restructuring program activity during the nine months ended September 30, 2020 and 2019 was as follows:

(in millions) Severance and Related Costs Termination and Other Costs Asset Impairments Total

4 unchanged sentences

Charges against reserve and currency ( 22 ) ( 24 ) ( 15 ) ( 61 )

Accrued Balance at June 30, 2020 $ 12 $ 4 $ — $ 16

Accrued Balance at September 30, 2020 $ 7 $ 3 $ — $ 10

CNDT Q3 2020 Form 10-Q

7 unchanged sentences

— ( 22 ) — ( 22 )

Accrued Balance at June 30, 2019 $ 19 $ 9 $ — $ 28

Accrued Balance at September 30, 2019 $ 13 $ 7 $ — $ 20

(1) Represents amounts recognized within the Consolidated Statements of Income (Loss) for the years shown.

(2) Relates to the adoption of the new lease guidance.

In addition, the Company recorded professional support costs associated with the strategic transformation program in Restructuring and related costs of $ 2 million and $ 2 million for the three months ended June 30, 2020 and 2019, respectively, and $ 4 million and $ 2 million for the six months ended June 30, 2020 and 2019, respectively.

In addition, the Company recorded professional support costs associated with the strategic transformation program in Restructuring and related costs of $ 2 million and $ 0 million for the three months ended September 30, 2020 and 2019, respectively, and $ 6 million and $ 2 million for the nine months ended September 30, 2020 and 2019, respectively.

The following table summarizes the total amount of costs incurred in connection with these restructuring programs by segment:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2020 2019 2020 2019

3 unchanged sentences

Other — ( 1 ) — —

Shared IT / Infrastructure & Corporate Costs 18 14 21 26

Unallocated Costs (1)

Total Net Restructuring Charges $ 18 $ 8 $ 50 $ 48

(1) Represents costs related to the consolidation of the Company's data centers, operating lease ROU assets impairment, termination and other costs not allocated to the segments.

Note 6 – Debt

Long-term debt was as follows:

(in millions) June 30, 2020 December 31, 2019

(in millions) September 30, 2020 December 31, 2019

Term loan A due 2022 $ 651 $ 664

3 unchanged sentences

Finance lease obligations 18 17

Other loans 2 —

Principal debt balance 1,673 1,539

2 unchanged sentences

Total Long-term Debt $ 1,574 $ 1,464

As of June 30, 2020, the Company has borrowed $ 150 million of its $ 750 million Senior Revolving Credit Facility (Revolver).

As of September 30, 2020, the Company has borrowed $ 150 million of its $ 750 million Senior Revolving Credit Facility (Revolver).

In addition, the Company has utilized $ 8 million of the Revolver to issue letters of credit.

The net Revolver available to be drawn upon as of June 30, 2020 was $ 592 million.

At June 30, 2020 and December 31, 2019, the Company was in compliance with all debt covenants related to the borrowings in the table above.

The net Revolver available to be drawn upon as of September 30, 2020 was $ 592 million.

CNDT Q3 2020 Form 10-Q

At September 30, 2020 and December 31, 2019, the Company was in compliance with all debt covenants related to the borrowings in the table above.

Note 7 – Financial Instruments

1 unchanged sentence

As a part of the Company's foreign exchange risk management strategy, the Company uses derivative instruments, primarily forward contracts, to hedge the funding of foreign entities which have a non-dollar functional currency, thereby reducing volatility of earnings or protecting fair values of assets and liabilities.

At June 30, 2020 and December 31, 2019, the Company had outstanding forward exchange contracts with gross notional values of $ 162 million and $ 207 million, respectively.

At June 30, 2020, approximately 74 % of these contracts mature within three months, 10 % in three to six months, 12 % in six to twelve months and 4 % in greater than twelve months.

At September 30, 2020 and December 31, 2019, the Company had outstanding forward exchange contracts with gross notional values of $ 160 million and $ 207 million, respectively.

At September 30, 2020, approximately 76 % of these contracts mature within three months, 9 % in three to six months, 12 % in six to twelve months and 3 % in greater than twelve months.

Most of these foreign currency derivative contracts are designated as cash flow hedges and did not have a material impact on the Company's balance sheet, income statement or cash flows for the periods presented.

11 unchanged sentences

The basis for the measurement at fair value in all cases was Level 2.

(in millions) June 30, 2020 December 31, 2019

(in millions) September 30, 2020 December 31, 2019

Foreign exchange contract - forward $ 2 $ 2

5 unchanged sentences

The estimated fair values of our other financial assets and liabilities were as follows:

June 30, 2020 December 31, 2019

September 30, 2020 December 31, 2019

(in millions) Carrying

7 unchanged sentences

The changes in the fair value are recorded in Other income (expense), net on the Condensed Consolidated Statements of Income (Loss).

During the third quarter of 2020, the contingent consideration payable was settled.

Note 9 – Employee Benefit Plans

7 unchanged sentences

hourly employees.

The Company recognized an expense related to its defined contribution plans of $ 0 million and $ 2 million for the three months ended June 30, 2020 and 2019, respectively, and $ 1 million and $ 5 million for the six months ended June 30, 2020 and 2019, respectively.

The Company recognized an expense related to its defined contribution plans of $ 1 million and $ 2 million for the three months ended September 30, 2020 and 2019, respectively, and $ 2 million and $ 7 million for the nine months ended September 30, 2020 and 2019, respectively.

Note 10 – Accumulated Other Comprehensive Loss (AOCL)

5 unchanged sentences

Net current period other comprehensive income (loss) ( 15 ) — 1 ( 14 )

Balance at June 30, 2020 $ ( 434 ) $ 2 $ ( 1 ) $ ( 433 )

Balance at September 30, 2020 $ ( 423 ) $ 3 $ ( 1 ) $ ( 421 )

CNDT Q3 2020 Form 10-Q

4 unchanged sentences

Net current period other comprehensive income (loss) 6 1 ( 1 ) 6

Balance at June 30, 2019 $ ( 405 ) $ 3 $ ( 2 ) $ ( 404 )

Balance at September 30, 2019 $ ( 420 ) $ 3 $ ( 2 ) $ ( 419 )

(1) All amounts are net of tax.

12 unchanged sentences

Should developments in any of these matters cause a change in the Company's determination as to an unfavorable outcome and result in the need to recognize a material accrual, or should any of these matters result in a final adverse judgment or be settled for significant amounts in excess of any accrual for such matter or matters, this could have a material adverse effect on the Company's results of operations, cash flows and financial position in the period or periods in which such change in determination, judgment or settlement occurs.

The Company believes it has recorded adequate provisions for any such matters as of June 30, 2020.

The Company believes it has recorded adequate provisions for any such matters as of September 30, 2020.

Litigation is inherently unpredictable, and it is not possible to predict the ultimate outcome of these matters and such outcome in any such matters could be in excess of any amounts accrued and could be material to the Company's results of operations, cash flows or financial position in any reporting period.

4 unchanged sentences

However, while the ultimate liabilities resulting from such claims may be significant to results of operations in the period recognized, management does not anticipate they will have a material adverse effect on the condensed consolidated financial position or liquidity.

As of June 30, 2020, the Company had accrued its estimate of liability incurred under its indemnification arrangements and guarantees.

As of September 30, 2020, the Company had accrued its estimate of liability incurred under its indemnification arrangements and guarantees.

Litigation Against the Company

25 unchanged sentences

CBS denies all of these allegations, believes that it has strong defenses to all of plaintiffs’ claims and will vigorously defend itself against these claims.

The Company is not able to determine or predict the ultimate outcome of this proceeding or reasonably provide an estimate or range of estimate of the possible outcome or loss, if any.

In the third quarter of 2020, CBS filed a counterclaim against Skyview Capital LLC seeking the outstanding balance on the Notes, the amounts owed for the Jamaica deferred closing portion of the sale, and other transition services agreement and late rent payment obligations.

The Company is not able to determine or predict the ultimate outcome of this proceeding or reasonably provide an estimate or range of estimate of the possible outcome or loss, if any, in excess of currently recorded reserves.

Dennis Nasrawi v.

40 unchanged sentences

The Company cannot provide assurance that the CFPB, another regulator, a financial institution on behalf of which the Company serviced third-party student loans, or another party will not ultimately commence a legal action against XES in which fines, penalties or other liabilities are sought from XES.

nor is the Company able to predict the likely outcome of these matters, should any such matter be commenced, or reasonably provide an estimate or range of estimates of any loss in excess of current reserves.

The Company is not able to predict the likely outcome of these matters, should any such matter be commenced, or reasonably provide an estimate or range of estimates of any loss in excess of currently recorded reserves.

The Company could, in future periods, incur judgments or enter into settlements to resolve these potential matters for amounts in excess of current reserves and there could be a material adverse effect on the Company's results of operations, cash flows and financial position in the period in which such change in judgment or settlement occurs.

1 unchanged sentence

Certain contracts, primarily in the Company's Government Services and Transportation segments, require the Company to provide a surety bond or a letter of credit as a guarantee of performance.

As of June 30, 2020, the Company had $ 578 million of outstanding surety bonds used to secure its performance of contractual obligations with its clients and $ 90 million of outstanding letters of credit issued to secure the Company's performance of contractual obligations to its clients as well as other corporate obligations.

As of September 30, 2020, the Company had $ 601 million of outstanding surety bonds used to secure its performance of contractual obligations with its clients and $ 86 million of outstanding letters of credit issued to secure the Company's performance of contractual obligations to its clients as well as other corporate obligations.

In general, the Company would only be liable for the amount of these guarantees in the event of default in the Company's performance of its obligations under each contract.

4 unchanged sentences

In December 2016, the Company issued 120,000 shares of Series A convertible perpetual preferred stock with an aggregate liquidation preference of $ 120 million and an initial fair value of $ 142 million.

The convertible preferred stock pays quarterly cash dividends at a rate of 8 % per year ($ 9.6 million per year).

The convertible preferred stock earns quarterly cash dividends at a rate of 8 % per year ($ 9.6 million per year).

Each share of convertible preferred stock is convertible at any time, at the option of the holder, into 44.9438 shares of common stock for a total of 5,393,000 shares (reflecting an initial conversion price of approximately $ 22.25 per share of common stock), subject to customary anti-dilution adjustments.

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions, except per share data in whole dollars and shares in thousands) 2020 2019 2020 2019

Net income (loss) $ ( 7 ) $ ( 16 ) $ ( 107 ) $ ( 1,353 )

Cash dividend paid - preferred stock ( 3 ) ( 3 ) ( 5 ) ( 5 )

Dividend - preferred stock ( 2 ) ( 2 ) ( 7 ) ( 7 )

Adjusted Net Income (Loss) Available to Common Shareholders $ ( 9 ) $ ( 18 ) $ ( 114 ) $ ( 1,360 )

10 unchanged sentences

The components of Other assets and liabilities were as follows:

(in millions) June 30, 2020 December 31, 2019

(in millions) September 30, 2020 December 31, 2019

Other Current Assets

20 unchanged sentences

Other Long-term Liabilities

Deferred payroll tax related to the CARES Act (1)

Income tax liabilities 13 20

2 unchanged sentences

Total Other Long-term Liabilities $ 105 $ 91

(1) CARES ACT – Coronavirus Aid, Relief, and Economic Security Act.

CNDT Q3 2020 Form 10-Q

9 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2020 2019 2020 2019

1 unchanged sentence

Purchases from related parties $ 4 $ 4 $ 12 $ 22

The Company's receivable and payable balances with related party entities were not material as of June 30, 2020 and December 31, 2019 .

The Company's receivable and payable balances with related party entities were not material as of September 30, 2020 and December 31, 2019 .

Note 16 – Goodwill

3 unchanged sentences

Foreign currency translation 2 ( 3 ) 5 4

Balance at June 30, 2020 $ 814 $ 616 $ 61 $ 1,491

In the first and second quarters of 2020, the Company performed its ongoing assessment to consider whether events or circumstances had occurred that could more likely than not reduce the fair value of a reporting unit below its carrying value.

Balance at September 30, 2020 $ 823 $ 618 $ 65 $ 1,506

In the first, second and third quarters of 2020, the Company performed its ongoing assessment to consider whether events or circumstances had occurred that could more likely than not reduce the fair value of a reporting unit below its carrying value.

After evaluating and weighing all relevant events and circumstances, we concluded that it is not more likely than not that the fair values of any of our reporting units were less than their carrying values.

1 unchanged sentence

To the extent the COVID-19 pandemic continues to disrupt the economic environment, such as a decline in the performance of the reporting units or loss of a significant contract or multiple significant contracts, the fair value of one or more of the reporting units could fall below their carrying value, resulting in a goodwill impairment charge.

In addition, the Company has assessed whether any impairment of its amortizable assets existed and has determined that no charges were deemed necessary under applicable accounting standards as of June 30, 2020.

CNDT Q3 2020 Form 10-Q

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements