What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-10-29 compared with 2023-10-27 · 443 added, 450 removed, 1007 unchanged (47% of the section changed)

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Management’s Statement of Responsibility for Financial Statements

Management’s Report on Internal Control over Financial Reporting

Management’s Report on Internal Control O ver Financial Reporting

Reports of Independent Registered Public Accounting Firm Reports of Independent Registered Public Accounting Firm (PCAOB ID:

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Schedule II – Valuation and Qualifying Accounts

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Management’s Statement of Responsibility for Financial Statements

Our management prepares and is responsible for the fairness, integrity and objectivity of our Consolidated Financial Statements.

The accompanying Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America and include amounts based on our management’s estimates and judgments.

The accompanying Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") and include amounts based on our management’s estimates and judgments.

All financial information in this Report on Form 10-K has been presented on a basis consistent with the information included in the accompanying financial statements.

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Our management is responsible for establishing and maintaining adequate internal control over financial reporting for FactSet.

Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

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Our management (with the participation of the Chief Executive Officer and Chief Financial Officer) conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on this evaluation, our management concluded that our internal control over financial reporting was effective as of August 31, 2023 .

Based on this evaluation, our management concluded that our internal control over financial reporting was not effective as of August 31, 2024 as a result of the material weakness in internal control over financial reporting described below.

Our management has identified certain control deficiencies related to the design and operation of our information technology (“IT”) general controls (“ITGCs”) that support our revenues, accounts receivable, and deferred revenues processes which, in the aggregate, rise to a material weakness in internal control over financial reporting.

The deficiencies related to program change management and user access in connection with segregation of duties and restriction to appropriate users.

As a result, the automated controls and IT dependent manual business process controls that rely upon information from the affected financial applications were also deemed not effective.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis.

While we have concluded that these control deficiencies did not result in any material misstatements in our Consolidated Financial Statements or disclosures in any of the fiscal years ended August 31, 2024, 2023 or 2022, they were not remediated as of August 31, 2024, and thus created a reasonable possibility that they could result in a material misstatement to the Consolidated Financial Statements that would not be prevented or detected on a timely basis.

Accordingly, we determined that these control deficiencies constituted a material weakness.

After giving full consideration to the material weakness, and the additional analyses and other procedures we performed to ensure that our Consolidated Financial Statements included in this Annual Report on Form 10-K were prepared in accordance

with GAAP, our management has concluded that our Consolidated Financial Statements present fairly, in all material respects, our financial position, results of operations and cash flows for the periods disclosed in conformity with GAAP.

Ernst & Young LLP (PCAOBID:

42), an independent registered public accounting firm, has audited the effectiveness of our internal control over financial reporting and has issued a report on our internal control over financial reporting, which is included in their report on the subsequent page.

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42), an independent registered public accounting firm, has audited the effectiveness of our internal control over financial reporting and has issued an adverse opinion on the effectiveness of our internal control over financial reporting as stated in their report on the subsequent page.

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of FactSet Research Systems Inc.

To the Stockholders and the Board of Directors of FactSet Research Systems Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of FactSet Research Systems Inc.

(the Company) as of August 31, 2023 and 2022, and the related consolidated statements of income, comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended August 31, 2023, and the related notes and financial statement schedule listed in the Index at Item 8 (collectively referred to as the “Consolidated Financial Statements”).

(the Company) as of August 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, changes in stockholders’ equity and cash flows for each of the three years in the period ended August 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at August 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended August 31, 2024, in conformity with U.S.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of August 31, 2023, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated October 27, 2023 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of August 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated October 29, 2024 expressed an adverse opinion thereon.

Basis for Opinion

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

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The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.

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Measurement of income tax provision

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We have served as the Company’s auditor since 2013.

Stamford, Connecticut

October 29, 2024

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Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of FactSet Research Systems Inc.

To the Stockholders and the Board of Directors of FactSet Research Systems Inc.

Opinion on Internal Control Over Financial Reporting

We have audited FactSet Research System Inc.’s (the Company) internal control over financial reporting as of August 31, 2023, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of August 31, 2023, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the 2023 Consolidated Financial Statements of the Company and our report dated October 27, 2023, expressed an unqualified opinion thereon.

We have audited FactSet Research Systems Inc.’s internal control over financial reporting as of August 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, because of the effect of the material weakness described below on the achievement of the objectives of the control criteria, FactSet Research Systems Inc.

(the Company) has not maintained effective internal control over financial reporting as of August 31, 2024, based on the COSO criteria.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The following material weakness has been identified and included in management’s assessment.

Management has identified a material weakness related to the design and operation of information technology (“IT”) general controls for certain financial applications that support the revenue, accounts receivable, and deferred revenue processes.

Consequently, automated controls and IT dependent manual business process controls that rely upon information from the affected financial applications were also deemed ineffective.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of August 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, changes in stockholders’ equity and cash flows for each of the three years in the period ended August 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15(a).

This material weakness was considered in determining the nature, timing and extent of audit tests applied in our audit of the 2024 and 2023 consolidated financial statements, and this report does not affect our report dated October 29, 2024, which expressed an unqualified opinion thereon.

Basis for Opinion

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/s/ Ernst & Young LLP

Stamford, Connecticut

October 29, 2024

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FactSet Research Systems Inc.

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

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FactSet Research Systems Inc.

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Comprehensive income $ 544,654 $ 489,415 $ 327,496

(1) Presented net of a tax benefit of $ 61 thousand, tax expense of $ 1,657 thousand, and a tax benefit of $ 162 thousand for the years ended August 31, 2023, 2022 and 2021, respectively.

(1) Presented net of a tax benefit of $ 369 thousand, tax benefit of $ 61 thousand, and a tax expense of $ 1,657 thousand for the years ended August 31, 2024, 2023 and 2022, respectively.

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

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FactSet Research Systems Inc.

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Accounts payable and accrued expenses $ 178,250 $ 121,816

Current debt 124,842 —

Current lease liabilities 31,073 28,839

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

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FactSet Research Systems Inc.

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Changes in assets and liabilities, net of effects of acquisitions

Accounts receivable, net of reserves ( 40,103 ) ( 32,980 ) 3,646

Accounts receivable 2,195 ( 40,103 ) ( 32,980 )

Accounts payable and accrued expenses 55,347 8,393 12,815

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Purchases of investments ( 58,636 ) ( 11,014 ) ( 878 )

Proceeds from maturity or sale of investments — — 2,176

Net cash provided by (used in) investing activities ( 144,317 ) ( 95,393 ) ( 2,033,675 )

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

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FactSet Research Systems Inc.

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Vesting of restricted stock 83,035 1 ( 1 ) 32,034 ( 13,544 ) ( 13,544 )

Excise tax on share repurchases ( 932 ) ( 932 )

Repurchases of common stock 430,350 ( 176,720 ) ( 176,720 )

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Dividends declared ( 142,816 ) ( 142,816 )

Other ( 759 ) ( 759 )

Balance as of August 31, 2023 42,096,628 $ 421 $ 1,323,631 4,071,256 $ ( 1,122,077 ) $ 1,505,096 $ ( 87,141 ) $ 1,619,930

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Dividends declared ( 153,718 ) ( 153,718 )

( 759 ) ( 759 )

Balance as of August 31, 2024 42,598,915 $ 426 $ 1,478,839 4,646,645 $ ( 1,375,696 ) $ 1,888,504 $ ( 79,613 ) $ 1,912,460

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

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FactSet Research Systems Inc.

August 31, 2024

Description of Business

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Segment Information

Subsequent Events

DESCRIPTION OF BUSINESS

FactSet Research Systems Inc.

and its wholly-owned subsidiaries (collectively, "we," "our," "us," the "Company" or "FactSet") is a global financial digital platform and enterprise solutions provider with open and flexible products that drive the investment community to see more, think bigger and do its best work.

and its wholly-owned subsidiaries (collectively, "we," "our," "us," the "Company" or "FactSet") is a global financial digital platform and enterprise solutions provider with open and flexible technologies that aims to supercharge financial intelligence.

Our platform delivers expansive data, sophisticated analytics, and flexible technology used by global financial professionals to power their critical investment workflows.

As of August 31, 2023, we had nearly 8,000 clients comprised of almost 190,000 investment professionals, including asset managers, bankers, wealth managers, asset owners, partners, hedge funds, corporate users and private equity & venture capital professionals.

Our revenues are primarily derived from subscriptions to our multi-asset class data and solutions powered by our connected content, referred to as our "content refinery." Our products and services include workstations, portfolio analytics and enterprise solutions.

We drive our business based on our detailed understanding of our clients’ workflows, which helps us to solve their most complex challenges.

We provide financial data and market intelligence on securities, companies, industries and people to enable our clients to research investment ideas, as well as to analyze, monitor and manage their portfolios.

Our on- and off-platform solutions span the investment life cycle of investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and reporting.

As of August 31, 2024, we had more than 8,200 clients comprised of over 216,000 investment professionals, including institutional asset managers, bankers, wealth managers, asset owners, partners, hedge funds, corporate users, and private equity and venture capital professionals.

Our revenues are primarily derived from subscriptions to our multi-asset class data and solutions powered by our connected data and technology platform.

Our products and services include workstations, portfolio analytics and enterprise data solutions.

We also offer managed services that operate as an extension of our clients' internal teams to support data, performance, risk and reporting workflows.

We drive our business based on detailed understanding of our clients’ workflows, which helps us to solve their most complex challenges.

We provide financial data and market intelligence on securities, companies, industries and people to enable our clients to research investment ideas and analyze, monitor and manage their portfolios.

Our solutions span the investment lifecycle of investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and reporting.

We provide open and flexible technology offerings, including a configurable desktop and mobile platform, comprehensive data feeds, cloud-based digital solutions, and application programming interfaces ("APIs").

Our CUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and back-office functions.

Our platform and solutions are supported by our dedicated client service teams.

The CUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and back-office functions.

All of our platforms and solutions are supported by our dedicated client service team.

We operate our business through three reportable segments ("segments"):

the Americas, EMEA and Asia Pacific.

Refer to Note 18, Segment Information, for further discussion.

For each of our segments, we execute our strategy through three workflow solutions:

Research & Advisory;

Analytics & Trading;

and Content & Technology Solutions ("CTS").

CGS operates as part of CTS.

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Revised Organizational Approach

We have a long-term view of our business and are committed to investing for growth and efficiency.

Starting September 1, 2023, the beginning of our fiscal 2024 year, we revised our internal organization by firm type to better align with our clients, as follows:

• Analytics & Trading will become "Institutional Buyside," focusing on asset managers, asset owners, and hedge fund companies.

• Research & Advisory will become two groups:

◦ "Dealmakers," focusing on banking and sell-side research, corporate, and private equity and venture capital workflows;

◦ "Wealth," focusing on wealth management workflows.

• We will discuss the results of our Partnerships and CGS groups, in combination.

Partnerships delivers solutions primarily to content providers, financial exchanges, and rating agencies, while CGS is the exclusive issuer of CUSIP and CINS identifiers globally.

• The activities of CTS will be reassigned to Institutional Buyside, Dealmakers, Wealth, and Partnerships and CGS.

This realignment of firm types is not expected to impact our segment reporting for fiscal 2024.

During fiscal 2024, we revised our internal organization within each segment to offer data, products and analytical applications by firm type:

Institutional Buyside, Dealmakers, Wealth, and Partnerships and CGS.

Our chief operating decision maker ("CODM") continues to review our business and operating results based on our segments, the realignment of our internal organization by firm type did not impact our segments for fiscal 2024.

Refer to Note 18, Segment Information for further discussion on our segments and CODM.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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all intercompany activity and balances have been eliminated.

We have evaluated subsequent events through the date that the financial statements were issued.

Reclassifications

In fiscal 2023, we separated the components of Interest expense, net to present Interest income and Interest expense separately in the Consolidated Statements of Income.

We conformed the comparative figures for fiscal 2022 and 2021 to the current year's presentation.

Use of Estimates

The preparation of our Consolidated Financial Statements and related disclosures in conformity with GAAP required management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Significant estimates may include income taxes, stock-based compensation, goodwill and intangible assets, business combinations, long-lived assets, contingencies and impairment assessments.

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

Actual results could differ from those estimates.

Significant estimates may include income taxes, stock-based compensation, goodwill and intangible assets, business combinations, property, equipment and leasehold improvements ("PPE"), contingencies and impairment assessments.

Actual results could differ materially from those estimates.

Revenue Recognition

Revenues are measured as the amount of consideration expected to be received in exchange for fulfilling our contractual performance obligations with our clients.

The majority of our revenues are derived from client access to our multi-asset solutions powered by our suite of connected content available over the contractual term (referred to as the "hosted platform").

The majority of our revenues are derived from client access to our multi-asset solutions powered by our platform of connected data and technology that is available over the contractual term (referred to as the "Hosted Platform").

The Hosted Platform is a subscription-based service that provides client access to various combinations of products and services including workstations, portfolio analytics and enterprise solutions.

In addition, through our CGS platform, we provide subscription access to a database of universally recognized identifiers reflecting differentiating characteristics for issuers and their financial instruments (referred to as the "identifier platform").

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We determined the majority of our contracts with clients, whether for our hosted platform or identifier platform services, each represent a single performance obligation covering a series of distinct products and services that are substantially the same and that have the same pattern of transfer to the client.

In addition, through the CGS platform, we provide subscription access to a database of universally recognized identifiers reflecting differentiating characteristics for issuers and their financial instruments (referred to as the "Identifier Platform").

Revenues from our products and services are recognized as we transfer control to our clients, in an amount that reflects the consideration we expect to receive in exchange for satisfying our performance obligations.

We determined the majority of our contracts with clients, whether for our Hosted Platform or Identifier Platform service, each represent a single performance obligation covering a series of distinct products and services that are substantially the same and that have the same pattern of transfer to the client.

The primary nature of our promise to the client is to provide daily access to each of these data and analytics platforms, with revenue recognized over-time as performance is satisfied on an output time-based measure of progress, as the client is simultaneously receiving and consuming the benefits of the platform.

We record deferred revenues when payments are received in advance of performance under the contract.

We record deferred revenues when payments are received in advance of performance under the client contract.

Stock-Based Compensation

Our stock-based awards include stock options, restricted stock units ("RSUs"), performance share units ("PSUs") and common stock purchased by eligible employees under our employee stock purchase plan ("ESPP").

We measure and recognize stock-based compensation for all stock-based awards granted to our employees and our non-employee members of the Board of Directors ("non-employee directors") based on their estimated grant date fair value.

Our stock-based compensation expense consists of:

• Stock options, restricted stock units ("RSUs") and/or performance share units ("PSUs") issued to eligible employees under the FactSet Research Systems Inc.

Stock Option and Award Plan, as Amended and Restated (the "LTIP").

• Stock options and RSUs issued to non-employee members of the Board of Directors ("non-employee directors") under the FactSet Research Systems Inc.

Non-Employee Directors’ Stock Option and Award Plan as Amended and Restated (the "Director Plan").

• Common stock purchased by eligible employees under the FactSet Research Systems Inc.

Employee Stock Purchase Plan as Amended and Restated (the "ESPP").

We measure and recognize stock-based compensation expense for all stock-based awards and purchases of common stock under the ESPP based on their estimated grant date fair value.

To estimate the grant date fair value, we utilize a lattice-binomial option-pricing model ("binomial model") for our employee stock options and the Black-Scholes model for non-employee director stock options and common stock purchased by eligible employees under our ESPP.

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The binomial model also incorporates market conditions, vesting restrictions and exercise patterns.

For RSUs and PSUs, the grant date fair value is measured by reducing the grant date price of our common stock by the present value of the dividends expected to be paid on the underlying stock during the requisite service period, discounted at the appropriate risk-free interest rate.

For RSUs and PSUs (collectively, "Restricted Stock Awards"), the grant date fair value is measured by reducing the grant date price of our common stock by the present value of expected future dividend payments on the underlying stock during the requisite service period, discounted at the appropriate risk-free interest rate.

The number of PSUs granted assumes target-level achievement of the specified performance levels within the payout range.

The ultimate number of common shares that may be earned from a PSU is determined based on the actual achievement of the specified performance levels within the payout range.

The ultimate number of common shares that may be earned pursuant to our PSU awards depends on the level of our achievement of stated financial performance objectives.

Stock-based compensation expense for stock option and RSU awards is recognized over the requisite service period using the straight-line method.

The amount of stock-based compensation expense recognized on any date, for stock options and RSUs granted, is at least equal to the vested portion of the award on that date.

Our PSUs require management to make assumptions regarding the probability of achieving specified performance levels established at the time of grant, and recognize stock-based compensation expense using the straight-line method over the requisite service period.

For stock options and RSU grants, the amount of stock-based compensation expense recognized on any date is at least equal to the vested portion of the award on that date.

Our PSUs require us to make assumptions regarding the probability of achieving specified performance levels established at the time of grant.

We recognize stock-based compensation expense for PSUs using the straight-line method over the requisite service period.

The probability of achieving the specified performance levels is reviewed on a quarterly basis to ensure the amount of stock-based compensation expense appropriately reflects the expected achievement.

For our ESPP, compensation expense is recognized on a straight-line basis over the offering period.

Stock-based awards are subject to the continued employment and continued service at the time of vesting by employees and non-employee directors, respectively.

For our ESPP, stock-based compensation expense is recognized on a straight-line basis over the offering period.

Our stock-based awards are generally subject to the continued employment and continued service at the time of vesting by employees and non-employee directors, respectively.

Compensation expense for stock-based awards is recorded net of estimated forfeitures, which are based on historical forfeiture rates and are revised if actual forfeitures differ from those estimates.

Research and Product Development Costs

We do not have a separate research and product development ("R&D") department, but rather these costs primarily consist of employee expenses, such as salaries and related benefits for our product development, software engineering and technical support departments, and certain third parties.

We do not have a separate research and product development ("R&D") department, but rather we rely on collaboration across departments, with costs primarily consisting of employee compensation costs, such as salaries and related benefits for our product development, software engineering and technical support departments, as well as certain third party costs.

These teams collaborate with our strategists, product and content managers, technologists, sales and other team members to develop new products and process innovations and enhance existing products.

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We incurred R&D costs of $ 265.2 million, $ 267.4 million and $ 255.1 million during fiscal 2024, 2023 and 2022, respectively.

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We account for income taxes using the asset and liability method.

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We follow a two-step approach in recognizing and measuring uncertain tax positions.

The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not (defined as a likelihood of more than 50%) that a tax position will be sustained based on its technical merits as of the reporting date.

The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not (defined as a likelihood of

more than 50%) that a tax position will be sustained based on its technical merits as of the reporting date.

The second step, for those positions that meet the recognition criteria, is to measure and recognize the largest amount of benefit that is greater than 50% likely of being realized upon effective settlement with a taxing authority.

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To the extent that the final outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made.

We accrue interest on all tax exposures for which reserves have been established consistent with jurisdictional tax laws, and classify this interest as Provision for income taxes in the Consolidated Statements of Income and Current taxes payable or Taxes payable (non-current), based on the expected timing of the payment, within the Consolidated Balance Sheets.

We accrue interest on all income tax exposures for which reserves have been established consistent with jurisdictional tax laws, and recognize this interest in the Provision for income taxes in the Consolidated Statements of Income and in Current taxes payable or Taxes payable (non-current), based on the expected timing of the payment, within the Consolidated Balance Sheets.

Cash and Cash Equivalents

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Accounts Receivable

Accounts receivable are recorded at the invoiced amount, net of an allowance for any potential uncollectible amounts.

Accounts receivable also includes unbilled receivables reflecting revenues earned but not yet invoiced.

Accounts receivable includes both invoiced and unbilled receivables, net of allowance for any potential uncollectible amounts.

Unbilled receivables reflect revenues earned for which we have the unconditional right to payment, even though we have not yet issued an invoice.

Amounts included in accounts receivable are expected to be collected within one year.

We evaluate our allowance to include expected credit losses and collectability trends based on a variety of factors, including our historical write-off activity, current economic environment, customer-specific information and expectations of future economic conditions.

Our allowance for expected credit losses is based on a variety of factors, including collectability trends, our historical write-off activity, current economic environment, customer-specific information and expectations of future economic conditions.

Our allowance is recorded to SG&A in the Consolidated Statements of Income and we assess the adequacy of the allowance on a quarterly basis.

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Property, Equipment and Leasehold Improvements

Property, equipment and leasehold improvements ("PPE") are stated at cost, less accumulated depreciation and amortization.

PPE are stated at cost, less accumulated depreciation and amortization.

Property and equipment are depreciated based on the straight-line method over the estimated useful lives of the assets, ranging from three to five years for computers and related equipment and seven years for furniture and fixtures.

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We review our PPE to determine if any indicators of impairment are present on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable.

If indicators of impairment are

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present, the asset group is tested for impairment by comparing the carrying value to undiscounted cash flows and, if impaired, written down to fair value based on discounted cash flows.

In addition, we periodically evaluate the estimated remaining useful lives of long-lived intangible assets to determine whether events or changes in circumstances warrant a revision to the remaining period of depreciation or amortization.

If indicators of impairment are present, the asset group is tested for impairment by comparing its carrying value to its undiscounted cash flows and if impaired, written down to fair value based on its discounted cash flows.

In addition, we periodically evaluate the estimated remaining useful lives of our PPE to determine whether events or changes in circumstances warrant a revision to the remaining period of depreciation or amortization.

We recognize the excess of the purchase price over the fair value of identifiable net assets acquired at the acquisition date as goodwill.

Goodwill is not amortized but is tested for impairment at the reporting unit level annually, or more frequently if impairment indicators occur.

Goodwill is not amortized as it is estimated to have an indefinite life and is teste d for impairment at the reporting unit level annually, or more frequently if impairment indicators occur.

Goodwill is deemed to be impaired and written-down in the period in which the carrying value of the reporting unit exceeds its fair value.

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When assessing goodwill for impairment, we may first elect to perform a qualitative analysis for the reporting units to determine whether it is more likely than not (a likelihood of more than 50 percent) that the fair value of the reporting unit is less than its carrying value.

If the qualitative analysis indicates that it is more likely than not the fair value of a reporting unit is less than its carrying amount or if we elect not to perform a qualitative analysis, a quantitative analysis is performed to determine whether a goodwill impairment exists.

The quantitative goodwill impairment analysis is used to identify potential impairment by comparing the carrying amount of a reporting unit with its fair value.

If the qualitative analysis indicates that it is more likely than not the fair value of a reporting unit is less

than its carrying value or if we elect not to perform a qualitative analysis, a quantitative analysis is performed to determine whether a goodwill impairment exists.

The quantitative goodwill impairment analysis is used to identify potential impairment by comparing the carrying value of a reporting unit with its fair value.

To perform this analysis, we apply the income approach which utilizes discounted cash flows, along with other relevant market information.

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If the carrying value of the reporting unit exceeds the fair value, then the goodwill is considered impaired and written down to the reporting unit’s fair value.

The impairment loss for the reporting unit cannot exceed the carrying amount of the goodwill allocated to that reporting unit.

The impairment loss for the reporting unit cannot exceed the carrying value of the goodwill allocated to that reporting unit.

Intangible Assets

Acquired Intangible Assets

We amortize intangible assets over their estimated useful lives, assuming no residual value.

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Intangible assets are tested for impairment qualitatively on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset group is not recoverable.

If indicators of impairment are present, amortizable intangible assets are tested for impairment by comparing the carrying value to undiscounted cash flows and, if impaired, written down to fair value based on discounted cash flows.

Developed Technology

Our developed technology intangible assets include capitalized internal-use software related to internal and external costs incurred during the application development stage related to developing, modifying or obtaining software for internal-use.

Costs related to software upgrades and enhancements are capitalized if it is determined that these upgrades or enhancements provide additional functionality to the software.

The capitalized software is amortized using the straight-line method over the estimated useful life of the software, generally three to five years .

These assets are subject to the impairment test guidance specified in the Acquired Intangible Assets disclosure above.

Our lease portfolio consists of operating leases primarily related to our office space.

If indicators of impairment are present, our intangible assets are tested for impairment by comparing the carrying value to undiscounted cash flows and, if impaired, written down to fair value based on discounted cash flows.

Internal-use Software and Implementation Costs of Hosting Arrangements

Our developed technology intangible assets (“Developed technology”) include capitalized internal-use software costs related to internal employee compensation costs and external expenses incurred during the application development phase.

These costs relate to the development, modification, or acquisition of software for internal-use and are recorded in Intangible assets, net on the Consolidated Balance Sheets.

Development costs related to software upgrades and enhancements are capitalized if they provide additional functionality.

We also capitalize qualifying implementation costs for hosting arrangements that meet the capitalization criteria per the internal-use software guidance.

These implementation costs are recorded in Other assets on the Consolidated Balance Sheets.

Our Developed technology and implementation assets are typically amortized over three to five years using the straight-line method.

Our operating lease arrangements relate to our office space and data centers .

We determine if an arrangement qualifies as a lease at inception by evaluating if there is an identified asset and whether we obtain substantially all the economic benefits of and have the right to control the use of an asset.

For operating leases with a term greater than one year, we recognize lease right-of-use ("ROU") assets and lease liabilities as the present value of future minimum lease payments over the reasonably certain lease term beginning at the commencement date.

The future minimum lease payments include fixed lease payments and certain qualifying index-based variable payments.

Our lease ROU assets may further be impacted by prepayments, lease

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incentives received and initial direct costs incurred.

Our lease ROU assets may further be impacted by prepayments, lease incentives received and initial direct costs incurred.

Our operating leases are classified within Lease right-of-use assets, net, Current lease liabilities and Long-term lease liabilities on our Consolidated Balance Sheets.

Our leases generally do not have a readily determinable implicit rate, therefore we use our incremental borrowing rate ("IBR") at the lease commencement date, or on the date of lease modification, if applicable, in determining the present value of future payments.

Our leases generally do not have a readily determinable implicit rate, therefore we use our incremental borrowing rate ("IBR") at the lease commencement or modification date, or on the date of lease modification, if applicable, in determining the present value of future payments.

Our IBR is derived by selecting U.S.

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We also consider revisions to the rate to reflect the geographic location where the leased asset is located.

Certain of our lease agreements include options to extend and options to terminate the lease, which we do not include in our minimum lease terms unless management is reasonably certain to exercise.

Certain of our lease agreements include options to extend and/or terminate the lease, which we do not include in our minimum lease terms unless we are reasonably certain to exercise these options.

We account for the lease and non-lease components as a single lease component, which we recognize over the expected term on a straight-line expense basis in occupancy costs (a component of SG&A expense in the Consolidated Statements of Income).

Variable lease payments are not included in the calculation of lease ROU assets and lease liabilities and are expensed as incurred within occupancy costs.

We review our lease ROU assets for impairment when there is an indication that an asset may no longer be recoverable.

The impairment assessment requires significant judgments and estimates, including estimating subtenant rental income, calculating an appropriate discount rate and assessing other applicable future cash flows associated with the leased location.

Variable lease payments that are not included in the calculation of lease ROU assets and lease liabilities are expensed as incurred within occupancy costs.

We review our lease ROU assets for impairment when there are indicators that an asset may no longer be recoverable.

The impairment assessment requires significant judgments and estimates, including estimating subtenant rental income, calculating

an appropriate discount rate and assessing other applicable future cash flows associated with the leased location.

These estimates are based on our experience and knowledge of the market in which the property is located, previous efforts to dispose of similar assets and the assessment of existing market conditions.

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in several currencies, we utilize derivative instruments (foreign currency forward contracts) to mitigate our currency exposures from fluctuations in foreign currency exchange rates that can create volatility in our results of operations, cash flows and financial condition.

Our primary currency exposures include the Indian Rupee, Euro, British Pound Sterling and Philippine Peso.

Our primary currency exposures include the British Pound Sterling, Euro, Indian Rupee and Philippine Peso.

In designing a specific hedging approach, we consider several factors, including offsetting exposures, significance of exposures, forecasting risk and potential effectiveness of the hedge.

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We account for treasury stock under the cost method and include Treasury stock as a component of Stockholders' equity on the Consolidated Balance Sheets.

We may repurchase shares of our common stock under our share repurchase program in the open market and via privately negotiated transactions, subject to market conditions.

We may repurchase shares of our common stock under our share repurchase program in the open market or via privately negotiated transactions, subject to market conditions.

Repurchased shares of our common stock are recorded at the market price on the trade date and are held as treasury shares until they are reissued or retired.

When treasury

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shares are reissued, if the issuance price is higher than the average price paid to acquire the shares ("the cost"), the excess of the issuance price over the cost is credited to additional paid-in capital ("APIC").

If the issuance is lower than the cost, the difference is first charged against any credit balance in APIC from treasury stock, with the remaining balance charged to Retained earnings.

We account for the formal retirement of treasury shares by deducting its par value from common stock, reflecting any excess over par value as a reduction to APIC (to the extent created by previous issuances of the shares) and then Retained earnings.

When treasury shares are reissued, if the issuance price is higher than the average price paid to acquire the shares ("the cost"), the excess of the issuance price over the cost is credited to additional paid-in capital ("APIC").

If the issuance is lower than the cost, the difference is first charged against any credit balance in APIC from Treasury stock, with the remaining balance charged to Retained earnings on the Consolidated Balance Sheets.

We account for the formal retirement of treasury shares by deducting its par value from Common stock, reflecting any excess over par value as a reduction to APIC (to the extent created by previous issuances of the shares) and then Retained earnings on the Consolidated Balance Sheets.

The Inflation Reduction Act of 2022 ("IRA"), which was enacted into law on August 16, 2022, imposed a nondeductible 1% excise tax on the net value of certain stock repurchases made after December 31, 2022.

During fiscal 2023, we reflected the applicable excise tax in treasury stock as part of the cost basis of the stock repurchased, and recorded a corresponding liability for the excise taxes payable in Accounts payable and accrued expenses on the Consolidated Balance Sheets.

During fiscal 2024, we recorded the applicable excise tax in Treasury stock as part of the cost basis of the stock repurchased and recorded a corresponding liability for the excise taxes payable in Accounts payable and accrued expenses on the Consolidated Balance Sheets.

Fair Value Measurements

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Certain wholly-owned subsidiaries operate under a functional currency different from the U.S.

dollar, including our primary currency exposures of the Indian Rupee, Euro, British Pound Sterling and Philippine Peso.

Our primary currency exposures include th e British Pound Sterling, Euro, Indian Rupee and Philippine Peso.

The financial statements of our foreign subsidiaries that are local currency functional are translated into U.S.

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dollars at the average rates of exchange for the period, monetary assets and liabilities using period-end rates and non-monetary assets and liabilities at their historical rates.

The resulting remeasurement gains and losses that arise from remeasuring the assets and liabilities of our foreign operations are recorded to SG&A in the Consolidated Statements of Income.

The resulting remeasurement gains and losses are recorded to SG&A in the Consolidated Statements of Income.

Concentrations of Credit Risk

Credit risk arises from the potential nonperformance by counterparties to fulfill their financial obligations.

Our financial instruments that potentially subject us to concentrations of credit risk consist primarily of our cash and cash equivalents, accounts receivable, investments in mutual funds and derivative instruments.

The maximum credit exposure of our cash and cash equivalents, accounts receivable and investments in mutual funds is their carrying values as of the balance sheet date.

The maximum credit exposure related to our derivative instruments is based upon the gross fair values as of the balance sheet date.

Cash and Cash Equivalents and Investments

We are exposed to credit risk on our cash and cash equivalents and investments in mutual funds in the event of default by the financial institutions with which we transact.

We invest our cash and cash equivalents and investments in mutual funds in accordance with our restrictive cash investment practices with the primary objective to preserve capital and maintain liquidity while minimizing our exposure to credit risk.

We have not experienced any losses in such accounts and we limit our exposure to credit loss by placing our cash and cash equivalents and investments in mutual funds with multiple financial institutions that we believe are high-quality and credit-worthy.

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Our financial instruments that potentially subject us to concentrations of credit risk consist primarily of our cash, cash equivalents, accounts receivable, investments in mutual funds and derivative instruments.

The maximum credit exposure of our cash, cash equivalents, accounts receivable and investments in mutual funds is their carrying values as of the balance sheet date.

The maximum credit exposure related to our derivative instruments is based upon their respective gross fair values as of the balance sheet date.

Cash, Cash Equivalents and Investments

We are exposed to credit risk on our cash, cash equivalents and investments in mutual funds in the event of default by the financial and governmental institutions with which we transact.

We invest in a manner that aligns with our restrictive cash investment practices, preserves capital and provides liquidity, while minimizing our exposure to credit risk.

We limit our exposure to credit loss by investing with multiple financial and governmental institutions that we believe are high-quality and credit-worthy.

We have not experienced any credit losses relating to our cash, cash equivalents and investments in mutual funds.

Accounts Receivable

Our accounts receivable credit risk is dependent upon the financial stability of our individual clients.

Our receivable reserve was $ 7.8 million and $ 2.8 million as of August 31, 2023 and August 31, 2022, respectively.

As of August 31, 2024 and August 31, 2023, our accounts receivable reserve was $ 14.6 million and $ 7.8 million, respectively.

We do not require collateral from our clients;

however, no single client represented more than 3.5% of our total subscription revenues in any fiscal year presented.

Our concentration of credit risk related to our accounts receivable is generally limited, due to our large and geographically dispersed client base.

however, no single client represented more than 3.5% of our total annual revenues for fiscal 2022 through fiscal 2024.

Due to our large and geographically dispersed client base, our concentration of credit risk related to our accounts receivable is generally limited.

Derivative Instruments

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however, one supplier provided the majority of our cloud computing support for fiscal 2024.

We maintain back-up facilities and other redundancies at our major data centers, take security measures and have emergency planning procedures to minimize the risk that an event will disrupt our operations.

We maintain back-up facilities and other redundancies at our data centers, take security measures and have emergency planning procedures to minimize the risk that an event will disrupt our operations.

Recently Adopted Accounting Pronouncements

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Accounting Pronouncements Not Yet Adopted

There were no new accounting pronouncements issued or effective as of August 31, 2023 that had, or are expected to have, a material impact on our Consolidated Financial Statements.

SEC Disclosures - The Enhancement and Standardization of Climate-Related Disclosures for Investors

In March 2024, the SEC adopted a final rule under SEC Release Nos.

33-11275 and 34-99678, The Enhancement and Standardization of Climate-Related Disclosures for Investors , which would require disclosure of certain climate-related information in various filings with the SEC.

In April 2024, the SEC stayed implementation of the final rule pending completion of judicial review.

We are currently assessing the potential impact of the rule on our disclosures.

Codification Improvements - Amendments to Remove References to the Concepts Statements

In March 2024, the FASB issued Accounting Standards Update ("ASU") 2024-02, Codification Improvements - Amendments to Remove References to the Concepts Statements .

This ASU amends the FASB Accounting Standards Codification ("the Codification") to remove references to various FASB Concepts Statements and impacts a variety of topics in the Codification.

The amendments apply to all reporting entities within the scope of the affected accounting guidance, but in most instances the references removed are extraneous and not required to understand or apply the guidance.

The amendments in this ASU are to be applied prospectively, although retrospective application is permitted, and are effective for our interim and annual financial statements starting in fiscal 2026.

Early adoption is permitted.

This ASU is not expected to have a material impact on our Consolidated Financial Statements or related disclosures.

Income Taxes - Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures .

This ASU enhances annual income tax disclosures primarily related to our effective tax rate reconciliation and income taxes paid.

The amendments in this ASU are to be applied prospectively, although retrospective application is permitted, and are effective for our annual financial statements starting in fiscal 2026.

Early adoption is permitted.

This ASU is not expected to have a material impact on our Consolidated Financial Statements.

We are currently assessing the impact of the new requirements on our disclosures.

Segment Reporting - Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures .

This ASU enhances segment disclosures primarily related to significant segment expenses for both interim and annual periods.

The amendments in this ASU are to be applied retrospectively and are effective for our annual financial statements starting in fiscal 2025 and interim periods starting in fiscal 2026.

Early adoption is permitted.

This ASU is not expected to have a material impact on our Consolidated Financial Statements.

We are currently assessing the impact of the new requirements on our disclosures.

Disclosure Improvements - Codification Amendment in Response to the Securities and Exchange Commission's ("SEC") Disclosure Update and Simplification Initiative

In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements - Codification Amendment in Response to the SEC’s Disclosure Update and Simplification Initiative .

The ASU incorporates several disclosure and presentation requirements currently residing in the SEC Regulations S-X and S-K.

The amendments will be applied prospectively and are effective when the SEC removes the related requirements from Regulations S-X or S-K.

Any amendments the SEC does not remove by June 30, 2027 will not be effective.

As we are currently subject to these SEC requirements, this ASU is not expected to have a material impact on our Consolidated Financial Statements or related disclosures.

No other new accounting pronouncements issued or effective during fiscal 2024 have had, or are expected to have, a material impact on our Consolidated Financial Statements.

REVENUE RECOGNITION

We derive most of our revenues by providing client access to our multi-asset class solutions powered by our content refinery, over the associated contractual term (referred to as the "Hosted Platform").

The Hosted Platform is a subscription-based service that provides client access to various combinations of products and services including workstations, portfolio analytics, and enterprise solutions.

In addition, through our CGS platform, we provide subscription access to a database of universally recognized identifiers enabling differentiating characteristics for issuers and their financial instruments (referred to as the "Identifier Platform").

We determined that the majority of our contracts with clients, whether for our Hosted Platform or Identifier Platform services, each represent a single performance obligation covering a series of distinct products and services that are substantially the same and that have the same pattern of transfer to the client.

We also determined the primary nature of the promise to the client is to provide daily access to each of these data and analytics platforms.

We derive most of our revenues by delivering client access to our Hosted Platform, which is a subscription-based service that provides clients with a tailored selection of products and services including workstations, portfolio analytics and enterprise solutions.

We also derive revenues from the Identifier Platform, a subscription-based CGS platform service that provides access to a database of universally recognized security identifiers and related descriptive data for issuers and their financial instruments.

The majority of each of our contracts with clients, whether for Hosted Platform or Identifier Platform services, represents a single performance obligation covering a series of distinct products and services that are substantially the same and that have the same pattern of transfer to the client.

The primary nature of the promise to the client is to provide daily access to each of these data and analytics platforms over the associated contractual term.

These platforms provide integrated financial information, analytical applications and industry-leading service for the investment community.

Based on the nature of the services and products offered by these platforms, we apply an output time-based measure of progress as the client is simultaneously receiving and consuming the benefits of the platform.

We recognize revenue for the majority of these platforms in accordance with the 'as invoiced' practical expedient as the amount of consideration that we have the right to invoice corresponds directly with the value of our performance to date.

Due to our election of the practical expedient, we do not consider payment terms as a financing component within a client contract when, at contract inception, the period between the transfer of the promised services to the client and the payment timing for those services will be one year or less.

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The majority of client contracts have a duration of one year or the amount we are entitled to receive corresponds directly with the value of performance obligations completed to date, and therefore, we do not disclose the value of the remaining unsatisfied performance obligations.

Based on the nature of the products and services offered by these platforms, we apply an output time-based measure of progress as the client is simultaneously receiving and consuming the benefits of the respective platform.

We recognize revenue for the majority of these platforms in accordance with the 'as invoiced' practical expedient, because the consideration that we have the right to invoice corresponds directly with the value of our performance to date.

There are no significant judgments that would impact the timing of revenue recognition.

The majority of client contracts have a duration of one year, or the amount we are entitled to receive corresponds directly with the value of our performance obligations completed to date.

Therefore, we do not disclose the value of the remaining unsatisfied performance obligations.

Disaggregated Revenues

We disaggregate revenues from contracts with clients by our segments which consist of the Americas, EMEA and Asia Pacific.

We believe these segments are reflective of how we manage our business and the markets in which we serve and best depict the nature, amount, timing and uncertainty of revenues and cash flows related to contracts with clients.

Segment revenues reflect sales to our clients based on their respective geographic locations.

We disaggregate revenues from our client contracts by segment based on the geographic region where the sale originated.

Our business segmentation by geography is aligned with the operational and economic characteristics of our business.

Refer to Note 18, Segment Information , for further information.

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In determining fair value, the use of various valuation methodologies, including market, income and cost approaches are permissible.

The inputs to these methodologies consider market comparable information, taking into account the principal or most advantageous market in which we would transact, when pricing the asset or liability.

When pricing an asset or liability, the inputs to these valuation methodologies consider market comparable information, taking into account the principal or most advantageous market in which we would transact.

Fair Value Hierarchy

The accounting guidance for fair value measurements establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

There are three levels of inputs that may be used to measure fair value based on the reliability of inputs.

A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level input that is significant to the fair value measurement.

Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect its placement within the fair value hierarchy levels.

We have categorized our cash equivalents, investments and derivatives within the fair value hierarchy as follows:

The accounting guidance for fair value measurements establishes a three-level fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The hierarchy ranks the reliability of the inputs, based upon the lowest level of input that is significant to the fair value measurement, used to determine fair value.

Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect its placement within the fair value hierarchy.

We have categorized our assets and liabilities within the fair value hierarchy as follows:

Level 1 – applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

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Level 3 – applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The assumptions used in determining fair value represent our best estimates, but these estimates involve inherent uncertainties and the application of our judgment.

As a result, if factors change, our fair value estimates could be materially different in the future and may adversely affect our business and financial results.

(a) Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables show, by level within the fair value hierarchy, our assets and liabilities that are measured at fair value on a recurring basis as of August 31, 2023 and 2022.

The following tables show, by level within the fair value hierarchy, our assets and liabilities that are measured at fair value on a recurring basis as of August 31, 2024 and August 31, 2023.

We did not have any transfers between levels of fair value measurements during fiscal 2024 and 2023.

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(in thousands) Fair Value Measurements at August 31, 2023

Level 1 Level 2 Level 3

(in thousands) Fair Value Measurements as of August 31, 2024

Level 1 Level 2 Level 3 Total

Money market funds (1)

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Total liabilities measured at fair value $ — $ 250 $ 4,193 $ 4,443

(in thousands) Fair Value Measurements at August 31, 2022

(in thousands) Fair Value Measurements as of August 31, 2023

Level 1 Level 2 Level 3 Total

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$ — $ 608 $ — $ 608

Contingent liability (4)

— — 8,008 8,008

Total liabilities measured at fair value $ — $ 608 $ 8,008 $ 8,616

(1) Our money market funds are readily convertible into cash and the net asset value of each fund on the last day of the reporting period is used to determine its fair value.

(1) Our money market funds are readily convertible into cash.

The net asset value of each fund on the last day of the reporting period is used to determine its fair value.

Our money market funds are included in Cash and cash equivalents within the Consolidated Balance Sheets.

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The income approach uses pricing models that rely on market observable inputs such as spot, forward and interest rates, as well as credit default swap spreads.

To estimate fair value for our interest rate swap agreements, we utilize a present value of future cash flows, leveraging a model-derived valuation that uses observable inputs such as interest rate yield curves.

To estimate fair value for our interest rate swap agreement, we utilize a present value of future cash flows, leveraging a model-derived valuation that uses observable inputs such as interest rate yield curves.

Refer to Note 5, Derivative Instruments for more information on our derivative instruments and their classification within the Consolidated Balance Sheets.

(4) The contingent liability resulted from the acquisition of a business during fiscal 2023 .

This liability reflects the present value of po tential future payments that are contingent upon the achievement of certain specified milestones.

(4) Our contingent liability resulted from the acquisition of a business during fiscal 2023.

This liability reflects the present value of potential future payments that are contingent upon the achievement of certain specified milestones.

The acquisition date fair value of the contingent liability was $ 7.9 million and was valued using a scenario-based method.

This method incorporates unobservable inputs and assumptions made by management, including the probability of achieving specified milestones, expected time until payment and the discount rate.

The fair value of the contingent liability is remeasured each reporting period until the contingency is resolved, with any changes in fair value recorded in SG&A in the Consolidated Statements of Income.

The change in the fair value of the contingent liability from the acquisition date through August 31, 2023 was driven by the passage of time, with no changes made to key assumptions used in our fair value estimates.

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The fair value of the contingent liability is remeasured each reporting period until the contingency is resolved, with any changes in fair value recorded in SG&A within the Consolidated Statements of Income.

During fiscal 2024, as the achievement of a specified milestone was met, we reclassified $ 4.7 million from our contingent liability to Accounts payable and accrued expenses.

The remaining change in the fair value of the contingent liability from the acquisition date through August 31, 2024 was driven by the passage of time, with no changes made to key assumptions used in our fair value estimates.

(b) Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

Assets that are measured at fair value on a non-recurring basis primarily relate to our tangible fixed assets, lease ROU assets, goodwill and intangible assets.

Assets that are measured at fair value on a non-recurring basis primarily include our PPE, lease ROU assets, goodwill and intangible assets.

These assets are assessed for impairment whenever events or circumstances indicate their carrying value may not be fully recoverable, and at least annually for goodwill.

The fair values of these non-financial assets are determined based on valuation techniques using the best information available, and may include quoted market prices, market comparable information and discounted cash flow projections.

These non-financial assets are required to be assessed for impairment whenever events or circumstances indicate their carrying value may not be fully recoverable, and at least annually for goodwill.

Asset impairments in the Consolidated Statements of Income were $ 25.9 million and $ 64.3 million during fiscal 2023 and 2022, respectively, to reflect the difference between the fair market value and carrying value of certain assets.

These impairments were mainly driven by an $ 18.0 million and $ 62.2 million charge during fiscal 2023 and 2022, respectively, related to our lease ROU assets and PPE.

These charges were associated with vacating certain leased office space to resize our real estate footprint for the hybrid work environment.

We recorded asset impairments in the Consolidated Statements of Income of $ 4.7 million and $ 25.9 million during fiscal 2024 and fiscal 2023, respectively, to reflect the difference between the fair market value and carrying value of certain assets.

These impairments were the result of a $ 3.4 million and $ 18.0 million charge during fiscal 2024 and fiscal 2023, respectively, related to our lease ROU assets and PPE.

These charges were associated with vacating certain leased office space to rightsize our real estate footprint.

As there were no expected future cash flows from the lease ROU assets for locations we will not sublease, nor for PPE linked to the vacated leased office space, we concluded that these assets hold no remaining fair value and were fully impaired.

For those locations we anticipated subleasing, we estimated the fair value of the lease ROU assets as of the cease use date, using a market approach, based on expected future cash flows from sublease income.

To complete this assessment we relied on certain ass umptions, which included estimates of the rental rate, period of vacancy, incentives and annual rent increases.

As there were no expected future cash flows associated with lease ROU assets for locations we will not sublease nor PPE associated with the related vacated leased office space, we determined these assets had no remaining fair value and were fully impaired.

Due to the subjective nature of the unobservable inputs used, the fair value measurement for the asset impairments are classified within Level 3 of the fair value hierarchy.

The remaining asset impairments for fiscal 2023 and 2022 were $ 7.9 million related to impairment of Developed technology and Trade names and $ 2.1 million related to Developed technology, respe ctively.

For this assessment we relied on certain assumptions, which included estimates of the rental rate, period of vacancy, incentives and annual rent increases.

Due to the subjective nature of the unobservable inputs used, the fair value measurement for the asset impairments was classified within Level 3 of the fair value hierarchy.

The remaining asset impairments for fiscal 2024 and 2023 were $1.3 million related to impairment of Developed technology and $ 7.9 million related to Developed technology and Trade names, respectively.

We elected not to carry our Long-term debt on the Consolidated Balance Sheets at fair value.

The carrying value of our Long-term debt is net of related unamortized discounts and debt issuance costs.

We elected not to carry our debt, which includes our Current debt and Long-term debt, at fair value on the Consolidated Balance Sheets.

The carrying value of our debt is net of related unamortized discounts and debt issuance costs.

Our debt is comprised of our Senior Notes and 2022 Credit Facilities.

Our Senior Notes are publicly traded;

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The fair value of our 2022 Credit Facilities is estimated based on quoted market prices for similar instruments, adjusted for unobservable inputs to ensure comparability to our investment rating, maturity terms and principal outstanding, which are considered Level 3 inputs.

Refer to Note 12, Debt for definitions of these terms and more information on the Senior Notes and 2022 Credit Facilities.

The following table summarizes information on our outstanding debt as of August 31, 2023 and 2022:

Refer to Note 12, Debt for definitions of, and more information on, our Senior Notes and 2022 Credit Facilities.

The following table summarizes information on our outstanding debt as of August 31, 2024 and August 31, 2023:

August 31, 2024 August 31, 2023

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2032 Notes Level 1 500,000 449,380 500,000 423,700

2022 Term Facility Level 3 375,000 376,406 750,000 750,975

2022 Revolving Facility Level 3 250,000 246,578 250,000 246,875

2022 Term Facility Level 3 125,000 125,242 375,000 376,406

Total principal amount $ 1,375,000 $ 1,300,960 $ 1,625,000 $ 1,507,871

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Total net carrying value of debt $ 1,365,973 $ 1,612,700

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DERIVATIVE INSTRUMENTS

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Factors considered in the decision to hedge an underlying market exposure include the materiality of the risk, the volatility of the market, the duration of the hedge, the degree to which the underlying exposure is committed, and the availability, effectiveness and cost of derivative instruments.

Derivative instruments are only utilized for risk management purposes and are not used for speculative or trading purposes.

We utilize derivative instruments to manage risk and not for speculative or trading purposes.

We limit counterparties to financial institutions we believe are credit-worthy.

Refer to Note 2, Summary of Significant Accounting Policies - Concentrations of Credit Risk , for further discussion on counterparty credit risk.

We leverage foreign currency forward contracts and interest rate swaps to mitigate certain operational exposures from the impact of changes in foreign currency exchange rates and to manage our interest rate exposure.

For a derivative that was designated and qualified as a cash flow hedge, the effective portion of the change in fair value of the derivative is recorded in AOCL, net of tax, in the Consolidated Balance Sheets.

Realized gains or losses resulting from settlement of our foreign currency forward contracts and swap agreements are subsequently reclassified into SG&A and Interest expense, respectively, in the Consolidated Statements of Income when the hedges are settled.

All of our derivatives qualified and were designated as cash flow hedges, and none of our derivatives were deemed ineffective for fiscal 2023 and 2022.

We leverage foreign currency forward contracts and interest rate swap agreements to mitigate certain operational exposures from the impact of changes in foreign currency exchange rates and to manage our floating interest rate exposure, respectively.

Our foreign currency forward contracts and interest rate swap agreements are designated as cash flow hedges at inception.

For highly effective cash flows hedges, the change in the derivative's fair value is recorded in AOCL, net of tax, in the Consolidated Balance Sheets.

Our cash flow hedges were highly effective with no amount of ineffectiveness recorded in the Consolidated Statements of Income during fiscal 2024 and 2023.

All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness.

Realized gains or losses from the settlement of our foreign currency forward contracts and interest rate swap agreements are subsequently reclassified into SG&A and Interest expense, respectively, in the Consolidated Statements of Income.

There was no discontinuance of our foreign currency forward contracts during fiscal 2022 through fiscal 2024 nor our interest rate swap agreements during fiscal 2023 and 2024.

As such, no corresponding gains or losses related to changes in the fair value of these contracts were reclassified into earnings prior to settlement during those respective periods.

Our 2020 interest rate swap agreement was terminated during fiscal 2022 and resulted in a one-time benefit.

Refer to the 2022 Swap Agreement discussed within this footnote for more information.

Foreign Currency Forward Contracts

As we operate globally, we are exposed to the risk that our financial condition, results of operations and cash flows could be impacted by changes in foreign currency exchange rates.

As of August 31, 2023, we maintained a series of foreign currency forward contracts to hedge a portion of our primary currency exposures of the Indian Rupee, Euro, British Pound Sterling and Philippine Peso.

To mitigate our currency exposure, we entered into these contracts to hedge between 25 % to 75 % of our projected primary currency operating expenses over their respective hedge periods which range from the first quarter of fiscal 2024 through the fourth quarter of fiscal 2024.

During fiscal 2024 and 2023, we maintained a series of foreign currency forward contracts to hedge a portion of our primary currency exposures, namely the British Pound Sterling, Euro, Indian Rupee and Philippine Peso.

We entered into these contracts with the intent to hedge between 25 % to 75 % of the currency exposure related to our projected operating income in these primary currencies over their respective hedge periods.

As of August 31, 2024, the hedge maturity periods of our outstanding foreign currency forward contracts range from the first quarter of fiscal 2025 through the fourth quarter of fiscal 2025.

The following table summarizes the gross notional value of our foreign currency forward contracts to purchase the respective local currency with U.S.

dollars as of August 31, 2024 and August 31, 2023:

August 31, 2024 August 31, 2023

(in thousands) Local Currency USD Local Currency USD

(in thousands) Local Currency Amount Notional Contract Amount (USD) Local Currency Amount Notional Contract Amount (USD)

Indian Rupee Rs 4,651,351 $ 55,200 Rs 3,363,150 $ 40,300

British Pound Sterling £ 41,200 52,372 £ 45,000 56,098

Euro € 43,800 48,183 € 39,000 42,646

Indian Rupee Rs 3,363,150 40,300 Rs 2,667,928 33,600

Philippine Peso ₱ 1,850,674 32,400 ₱ 1,888,541 33,600

Total $ 188,155 $ 172,644

There was no discontinuance of our foreign currency cash flow hedges during fiscal 2023 and 2022, as such, no corresponding gains or losses related to changes in the value of our contracts were reclassified into earnings prior to settlement.

Refer to Part II, Item 7A.

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2024 Swap Agreement

On March 1, 2022, we entered into an interest rate swap agreement ("2022 Swap Agreement") with a notional amount of $ 800.0 million to hedge a portion of our outstanding floating Secured Overnight Financing Rate ("SOFR") rate debt with a fixed interest rate of 1.162 %.

The notional amount of the 2022 Swap Agreement declines by $ 100.0 million on a quarterly basis beginning May 31, 2022 and is maturing on February 28, 2024.

Effective December 30, 2022, we partially novated our 2022 Swap Agreement to equally apportion the then outstanding notional amount of the interest rate swap between two counterparties.

No other terms of the 2022 Swap Agreement were amended, terminated, or otherwise modified.

On March 1, 2024, we entered into an interest rate swap agreement ("2024 Swap Agreement") with a notional amount of $ 200.0 million to hedge a portion of our outstanding floating Secured Overnight Financing Rate ("SOFR") debt with a fixed interest rate of 5.145 %.

The notional amount of the 2024 Swap Agreement declines by $ 50.0 million on a quarterly basis beginning May 31, 2024.

As of August 31, 2024, the notional amount of the 2024 Swap Agreement was $ 100.0 million.

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Refer to Note 12, Debt , for further discussion of our outstanding floating SOFR rate debt and refer to Part II, Item 7A.

Quantitative and Qualitative Disclosures About Market Risk , of this Annual Report on Form 10-K for further discussion of our exposure to interest rate risk on our long-term debt outstanding.

The 2024 Swap Agreement matures on February 28, 2025.

2022 Swap Agreement

On March 1, 2022, we entered into an interest rate swap agreement ("2022 Swap Agreement") with a notional amount of $ 800.0 million to hedge a portion of our outstanding floating SOFR rate debt with a fixed interest rate of 1.162 %.

The notional amount of the 2022 Swap Agreement declined by $ 100.0 million on a quarterly basis beginning May 31, 2022.

Effective December 30, 2022, we partially novated our 2022 Swap Agreement to equally apportion the then-outstanding notional amount of the interest rate swap between two counterparties.

No other terms of the 2022 Swap Agreement were amended, terminated, or otherwise modified prior to its maturity.

The 2022 Swap Agreement matured on February 28, 2024.

2020 Swap Agreement

On March 5, 2020, we entered into an interest rate swap agreement ("2020 Swap Agreement") with a notional amount of $ 287.5 million.

The 2020 Swap Agreement hedged a portion of our then outstanding floating London Interbank Offer Rate ("LIBOR") rate debt with a fixed interest rate of 0.7995 % to mitigate our interest rate exposure.

On March 1, 2022, we terminated the 2020 Swap Agreement, which resulted in a one-time benefit of $ 3.5 million recognized in Interest expense in the Consolidated Statements of Income during the third quarter of fiscal 2022, based on its fair market value.

Refer to Note 12, Debt , for further discussion of our outstanding floating rate debt and refer to Part II, Item 7A.

Quantitative and Qualitative Disclosures About Market Risk , in this Annual Report on Form 10-K for further discussion of our exposure to interest rate risk on our variable interest rate debt outstanding.

Gross Notional Value and Fair Value of Derivative Instruments

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Interest rate swap agreement Prepaid expenses and other current assets — 3,123 Accounts payable and accrued expenses 123 —

Other assets — 1,791 Other liabilities — —

Total cash flow hedges $ 2,619 $ 4,383 $ 250 $ 608

Derivative Recognition

The following table provides the pre-tax effect of derivative instruments in cash flow hedging relationships for the years ended August 31, 2023, 2022 and 2021:

(in thousands)

Gain (Loss) Recognized in AOCL on Derivatives Location of Gain (Loss) Reclassified from AOCL into Income Gain (Loss) Reclassified from AOCL into Income

The following table provides the pre-tax effect of cash flow hedge accounting on our AOCL for the years ended August 31, 2024, 2023 and 2022:

(in thousands) Gain (Loss) Recognized in AOCL on Derivatives Location of Gain (Loss) Reclassified from AOCL into Income Gain (Loss) Reclassified from AOCL into Income

Derivatives in Cash Flow Hedging Relationships 2024 2023 2022 2024 2023 2022

2023 2022 2021 2023 2022 2021

Foreign currency forward contracts $ 1,771 $ 5,783 $ ( 16,356 ) SG&A $ ( 69 ) $ ( 3,176 ) $ ( 7,867 )

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As of August 31, 2024, we estimate that net pre-tax derivative gains of $ 2.4 million included in AOCL will be reclassified into earnings within the next 12 months.

As of August 31, 2023, our cash flow hedges were highly effective with no amount of ineffectiveness recorded in the Consolidated Statements of Income.

All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness.

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Offsetting of Derivative Instruments

We enter into master netting arrangements designed to permit net settlement of derivative transactions among the respective counterparties, settled on the same date and in the same currency.

As of August 31, 2023 and 2022, there were no material amounts recorded net on the Consolidated Balance Sheets.

We completed acquisitions of several businesses during fiscal 2021 through fiscal 2023 , with the most significant cash flows related to the acquisitions of CGS, Cobalt Software, Inc.

("Cobalt") and Truvalue Labs, Inc.

As of August 31, 2024 and 2023, there were no material amounts recorded net in the Consolidated Balance Sheets.

Our acquisitions with the most significant cash flows during fiscal 2022 through fiscal 2024 included CGS and Cobalt Software, Inc.

Refer to Note 19, Subsequent Events for information on our proposed acquisition of Platform Group Limited (“Irwin”).

CUSIP Global Services

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Total purchase price $ 1,931,526

(1) Included an accounts receivable balance of $ 29.5 million.

(2) Included a deferred revenues balance of $ 99.4 million.

(1) Includes an accounts receivable balance of $ 29.5 million.

(2) Includes a deferred revenues balance of $ 99.4 million.

The CGS acquisition was accounted for in accordance with ASU No.

2021-08, Business Combinations:

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805);

2021-08, Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ;

as such, the deferred revenues did not include a fair value adjustment.

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The results of CGS's operations have been included in our Consolidated Financial Statements, within the Americas, EMEA and Asia Pacific segments, beginning with the closing of the acquisition on March 1, 2022.

CGS operates as part of our CTS

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workflow solution.

Pro forma information has not been presented because the effect of the CGS acquisition was not material to our Consolidated Financial Statements.

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Pro forma information has not been presented because the effect of the Cobalt acquisition was not material to our Consolidated Financial Statements.

Truvalue Labs, Inc.

On November 2, 2020, we acquired all of the outstanding shares of TVL for a purchase price of $ 41.9 million, net of cash acquired.

TVL is a leading provider of sustainability information.

TVL applies artificial intelligence driven technology to over 100,000 unstructured text sources in multiple languages, including news, trade journals, and non-governmental organizations and industry reports, to provide daily signals that identify positive and negative sustainability behavior.

We acquired TVL to further enhance our commitment to providing industry leading access to sustainability data across our platforms.

The TVL purchase price was in excess of the fair value of net assets acquired, resulting in the recognition of goodwill.

We finalized the purchase accounting for the TVL acquisition during the third quarter of fiscal 2021.

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The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows:

Acquisition Date Fair Value Acquisition Date Useful Life Amortization Method

(in thousands) (in years)

Current assets $ 812

Amortizable intangible assets

Software technology 8,100 7 years Straight-line

Trade names 2,800 15 years Straight-line

Client relationships 900 12 years Straight-line

Goodwill 30,058

Other assets 5,299

Current liabilities ( 3,069 )

Other liabilities ( 2,984 )

Total purchase price $ 41,916

Goodwill totaling $ 30.1 million represents the excess of the TVL purchase price over the fair value of net assets acquired and considers future economic benefits that we expect to achieve as a result of the acquisition.

The goodwill is included in the Americas segment and is not deductible for income tax purposes.

The results of TVL's operations have been included in our Consolidated Financial Statements, within the Americas segment, beginning with its acquisition on November 2, 2020.

Pro forma information has not been presented because the effect of the TVL acquisition is not material to our Consolidated Financial Statements.

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

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Property, equipment and leasehold improvements, net $ 82,513 $ 86,107

Depreciation expense was $ 18.1 million, $ 24.3 million and $ 30.4 million for fiscal 2023, 2022 and 2021, respectively.

During fiscal 2023 and 2022, we incurred impairment charges of $ 3.6 million and $ 30.7 million, respectively, for PPE related to vacating certain leased office space.

PPE depreciation and amortization expense was $ 20.2 million, $ 18.1 million and $ 24.3 million for fiscal 2024, 2023 and 2022, respectively.

During fiscal 2024, 2023 and 2022, we incurred impairment charges of $ 1.8 million, $ 3.6 million and $ 30.7 million, respectively, for PPE related to vacating certain leased office space.

The impairment charges are included within Asset impairments in the Consolidated Statements of Income.

Ref er to Note 4, Fair Value Measures , for more information on the PPE impairment methodology.

During fiscal 2023, we disposed of fully depreciated assets that were no longer in use and derecognized these assets and related accumulated depreciation from the Consolidated Balance Sheets.

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Changes in the carrying amount of goodwill by segment for the years ended August 31, 2023 and 2022 are as follows:

Refer to Note 4, Fair Value Measures , for more information on the PPE impairment methodology.

Changes in the carrying value of goodwill by segment for the years ended August 31, 2024 and 2023 are as follows:

(in thousands) Americas EMEA Asia Pacific Total

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We performed our annual goodwill impairment test during the fourth quarter of fiscal 2024 and 2023.

During fiscal 2023, we utilized a quantitative analysis, electing to bypass the optional qualitative assessment, and concluded there was no impairment as the fair value of each of the Company's reporting units exceeding its carrying value.

During fiscal 2024, we utilized a qualitative analysis and concluded there was no impairment as it was more likely than not that the fair value of each of our reporting units was not less than its respective carrying value.

INTANGIBLE ASSETS

We amortize intangible assets on a straight-line basis over their estimated useful lives.

The estimated useful life, gross carrying amounts and accumulated amortization totals related to our identifiable intangible assets are as follows:

The following table presents the estimated useful life, gross carrying amounts and accumulated amortization related to our identifiable intangible assets as of August 31, 2024 and August 31, 2023:

August 31, 2024 August 31, 2023

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181,492 68,286 113,206 109,222 45,560 63,662

Acquired databases 15

Data content (1)

84,374 38,725 45,649 81,021 33,108 47,913

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143,685 117,189 26,496 142,395 108,702 33,693

Data content 7 to 20

35,021 28,508 6,513 32,305 24,973 7,332

Non-compete agreements 4

290 85 205 290 12 278

Trade names 15

— — — 6,693 4,431 2,262

Total $ 2,259,260 $ 415,119 $ 1,844,141 $ 2,181,243 $ 322,041 $ 1,859,202

The weighted average useful life of our intangible assets at August 31, 2023 was 32.6 years.

As described in Note 6, Acquisitions , we acquired several intangible assets as part of the CGS acquisition.

The weighted average useful life of our intangible assets at August 31, 2023, excluding those acquired from CGS, was 8.9 years.

During fiscal 2023 and 2022, we incurred impairment charges of $ 7.9 million related to impairment of Developed technology and Trade names and $ 2.1 million related to Developed technology, respectively, which is included in Asset impairments in the Consolidated Statements of Income.

(1) During fiscal 2024, we combined our Data content and Acquired databases intangible assets together, currently presented as Data content.

We conformed the comparative figures as of August 31, 2023 to the current year's presentation.

The weighted average useful life of our intangible assets as of August 31, 2024 was 31.9 years.

During fiscal 2024 and 2023, we incurred asset impairment charges of $1.3 million related to Developed technology and $ 7.9 million related to Developed technology and Trade names, respectively, which is included in Asset impairments in the Consolidated Statements of Income.

We did not identify a material change to the estimated remaining useful lives of our intangible assets during fiscal 2024 and 2023.

The intangible assets have no assigned residual values.

Amortization expense recorded for intangible assets was $ 87.3 million, $ 62.4 million, and $ 31.5 million during fiscal 2023, 2022, and 2021, respectively.

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As of August 31, 2023, estimated intangible asset amortization expense for each of the next five years and thereafter are as follows:

The following table presents the amortization expense for our intangible assets which is included in Cost of services in our Consolidated Statements of Income:

Years ended August 31,

(in thousands)

2024 2023 2022

Amortization expense

$ 104,950 $ 87,304 $ 62,382

As of August 31, 2024, estimated intangible asset amortization expense for each of the next five years and thereafter is as follows:

(in thousands) Estimated Amortization Expense

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Income tax expense is based on taxable income determined in accordance with current enacted laws and tax rates.

Deferred income taxes are recorded for the temporary differences between the financial statement and the tax basis of assets and liabilities using currently enacted tax rates.

Income Taxes Provision and Components of Income Taxes

The provision for income taxes is as follows:

Deferred income taxes are recorded for the temporary differences between the financial statement carrying amounts and the tax basis of our assets and liabilities using currently enacted tax rates.

Provision for Income Taxes and Effective Tax Rate

The provision for income taxes and the effective tax rate are as follows:

(in thousands) Years ended August 31,

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operations 59,158 61,444 28,570

Total provision for income taxes $ 115,781 $ 46,677 $ 68,027

Provision for income taxes

$ 114,377 $ 115,781 $ 46,677

Effective tax rate 17.6 % 19.8 % 10.5 %

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The components of the provision for income taxes consist of the following:

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Total deferred taxes $ ( 32,020 ) $ ( 31,119 ) $ ( 8,715 )

Total provision for income taxes $ 115,781 $ 46,677 $ 68,027

Our effective tax rate is based on recurring factors and non-recurring events, including the taxation of foreign income.

Provision for income taxes

$ 114,377 $ 115,781 $ 46,677

Our effective tax rate will vary based on, among other things, changes in levels of foreign income, as well as other non-recurring events.

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Stock-based payments ( 2.1 ) ( 2.2 ) ( 3.4 )

impact of foreign income ( 2.5 ) ( 0.6 ) —

Uncertain tax positions 2.3 0.5 0.4

One-time adjustment (2)

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Effective tax rate 17.6 % 19.8 % 10.5 %

(1) During fiscal 2023, we recorded an out-of-period adjustment related to a review and analysis of certain tax positions, resulting in a one-time net charge of $ 22.1 million.

(1) During fiscal 2024, we further disaggregated our effective tax rate reconciliation.

We conformed comparative figures for fiscal 2023 and 2022 to the current year’s presentation.

(2) During fiscal 2023, we recorded an out-of-period adjustment related to a review and analysis of certain tax positions, resulting in a one-time net charge.

The adjustment related to the accounting of tax balance sheet accounts.

All local, federal and foreign taxes payable have been paid in a timely manner, subject to normal audits of open years.

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Deferred Tax Assets and Liabilities

The significant components of deferred tax assets and liabilities recorded within the Consolidated Balance Sheets were as follows:

(in thousands) August 31,

(in thousands) As of August 31,

Deferred tax assets:

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Stock-based compensation 35,615 32,611

Unrealized tax loss on investment — 4,216

Capitalization of R&D costs 109,664 58,709

Sales Tax Dispute 14,058 —

Other 28,154 21,701

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Deferred tax liabilities:

Depreciation on property, equipment and leasehold improvements $ 29,048 $ 19,855

Depreciation on PPE $ 35,666 $ 29,048

Purchased intangible assets, including acquired technology 106,131 84,102

Lease right-of-use assets 33,900 27,540

Lease ROU assets 24,429 33,900

Other 9,753 1,087

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Utilization of the NOLs may be subject to an annual limitation due to the ownership limitations provided by the Internal Revenue Code of 1986, as amended (the "Code"), and similar state provisions.

Any annual limitation may result in the expiration of net operating losses before utilization.

Any annual limitation may result in the expiration of NOLs before utilization.

Unrecognized Tax Benefits

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(1) The unrecognized tax benefits include accrued interest of $ 3.9 million, $ 1.6 million and $ 1.4 million as of August 31, 2024, 2023 and 2022, respectively.

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We do not currently anticipate that the total amounts of unrecognized tax benefits will significantly change within the next 12 months.

We do not currently anticipate that the total amount of unrecognized tax benefits will significantly change within the next 12 months.

If our unrecognized tax benefits as of fiscal 2024, 2023, and 2022 were realized in a future period, this would result in a tax benefit of $ 29.1 million, $ 19.1 million and $ 16.5 million, respectively, which would affect the effective tax rate in a future period.

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At August 31, 2024, we remained subject to examination in the following significant tax jurisdictions for the fiscal years as indicated below:

Significant Tax Jurisdiction

Open Tax Fiscal Years

Significant Tax Jurisdiction Open Tax Fiscal Years

Federal 2019 through 2023

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Undistributed Foreign Earnings

As of August 31, 2023 , we had approximately $ 204.0 million of undistributed foreign earnings.

We permanently reinvest all foreign undistributed earnings, except in jurisdictions where earnings can be repatriated substantially free of tax.

It is not practicable to determine the deferred tax liability that would be payable if these earnings were repatriated to the U.S.

As of August 31, 2024 , we have $ 306.6 million of undistributed foreign earnings of which $ 87.7 million are permanently reinvested.

It is not practicable to determine the deferred tax liability that would be payable if these permanently reinvested earnings were repatriated to the U.S.

As of August 31, 2024, we have recorded a deferred tax liability of $ 3.6 million, which represents the future tax consequences that are expected upon the ultimate repatriation of earnings that are not permanently reinvested.

With respect to outside basis differences other than unremitted earnings, we continue to be permanently reinvested and have no plans to liquidate or sell any foreign subsidiaries.

In addition, we have not provided for deferred taxes on any outside basis differences of our domestic subsidiaries as we have the ability and intent to recover these basis differences in a tax-free manner.

It is not practicable to determine the amount of unrecognized deferred tax related to these basis differences.

Inflation Reduction Act of 2022

On August 16, 2022, the IRA was signed into law.

The IRA contains several revisions to the Code effective for taxable years beginning after December 31, 2022, including a 15% minimum income tax on certain large corporations.

We do not expect this revision to have a material impact on our Consolidated Financial Statements.

Our lease portfolio is primarily related to our office space, under various operating lease agreements.

The IRA contains several revisions to the Code effective for taxable years beginning after December 31, 2022, including a 15% corporate alternative minimum tax ("CAMT") on certain large corporations.

The CAMT did not have an impact on our Consolidated Financial Statements for fiscal 2024.

Base Erosion and Profit Shifting Pillar Two

The Organization for Economic Co-operation and Development released Base Erosion and Profit Shifting Pillar Two rules (“Pillar Two”) to introduce a global minimum corporate tax of 15% for companies with global revenues and profits above certain thresholds.

Certain aspects of Pillar Two are effective for tax years beginning on or after January 1, 2024.

Although the U.S.

has not yet enacted legislation to adopt Pillar Two, certain countries in which we operate have already adopted, or are in the process of adopting, legislation to implement Pillar Two.

We do not expect Pillar Two to have a material impact on our Consolidated Financial Statements, related disclosures or effective tax rate.

Our operating lease arrangements relate to our office space and data centers.

We review new arrangements at inception to evaluate whether we obtain substantially all the economic benefits of and have the right to control the use of an asset.

Our lease ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments at lease commencement (which includes fixed lease payments and certain qualifying index-based variable payments) over the reasonably certain lease term, leveraging an estimated IBR.

Our lease ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments at lease commencement or modification date (which includes fixed lease payments and certain qualifying index-based variable payments) over the reasonably certain lease term, leveraging an estimated IBR.

Certain adjustments to calculate our lease ROU assets may be required due to prepayments, lease incentives received and initial direct costs incurred.

We account for lease and non-lease components as a single lease component, which we recognize over the expected term on a straight-line expense basis in occupancy costs (a component of SG&A expense) in our Consolidated Statements of Income.

We account for lease and non-lease components as a single lease component, which we recognize over the expected lease term on a straight-line expense basis in occupancy costs (a component of SG&A expense) in our Consolidated Statements of Income.

As of August 31, 2024 , we recognized $ 130.5 million of Lease ROU assets, net and $ 208.6 million of combined Current lease liabilities and Long-term lease liabilities in the Consolidated Balance Sheets.

Such leases have a remaining lease term ranging from less than one year to just over 12 years and did not include any renewal or termination options that were not yet reasonably certain to be exercised.

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The following table reconciles our future undiscounted cash flows related to our operating leases and the reconciliation to the combined Current lease liabilities and Long-term lease liabilities in the Consolidated Balance Sheets as of August 31, 2023:

Our leases have a remaining lease term ranging from less than one year to just over 11 years.

Our lease agreements may include options to extend or terminate the lease which are included in the measurement of our lease term when it is reasonably certain that we will exercise the option.

The following table presents our future minimum lease payments and a reconciliation to the combined Current lease liabilities and Long-term lease liabilities in the Consolidated Balance Sheets as of August 31, 2024:

(in thousands) Minimum Lease

Years Ended August 31,

Fiscal Years Ended August 31,

2025 $ 39,773

Thereafter 62,797

Total $ 268,670

Total minimum lease payments $ 241,991

Imputed interest 33,397

Present value $ 227,221

The following table includes the components of our occupancy costs in our Consolidated Statements of Income:

Total lease liabilities $ 208,594

The following table includes components of our occupancy costs:

Years ended August 31,

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2024 2023 2022

Operating lease cost (1)

Operating lease costs (1)

$ 30,407 $ 32,330 $ 38,830

Variable lease cost (2)

Variable lease costs (2)

$ 17,280 $ 17,940 $ 11,542

(1) Operating lease costs include costs associated with fixed lease payments and index-based variable payments that qualified for lease accounting under ASC 842, Leases and complied with the practical expedients and exceptions we elected.

(2) Variable lease costs include costs that were not fixed at the lease commencement date and are not dependent on an index or rate.

(2) Variable lease costs include costs that are not fixed and are not dependent on an index or rate.

These costs were not included in the measurement of lease liabilities and primarily include variable non-lease costs, such as utilities, real estate taxes, insurance and maintenance, as well as lease costs for those leases that qualified for the short-term lease exception.

The following table summarizes our lease term and discount rate assumptions related to the operating leases recorded on the Consolidated Balance Sheets:

The following table summarizes our weighted average remaining lease term and weighted average discount rate related to our operating leases recorded on the Consolidated Balance Sheets:

As of August 31,

Weighted average remaining lease term (in years)

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$ ( 281 ) $ ( 1,376 ) $ ( 17,597 )

(1) Primarily includes new lease arrangements entered into during the respective year and contract modifications that extend our lease terms and/or provide additional rights.

(1) Primarily includes new lease arrangements entered into during the respective period and contract modifications that extend our lease terms and/or provide additional rights.

(2) Primarily relates to lease term reassessments based on contractual options to early terminate, resulting in a reduction to the lease liability and the corresponding lease ROU asset.

During fiscal 2023 and 2022 , we incurred impairment charges of $ 14.4 million and $ 31.5 million, respectively, related to our lease ROU assets associated with vacating certain leased office space, which are included in Asset impairments in the Consolidated Statements of Income.

During fiscal 2024, 2023 and 2022, we incurred impairment charges of $ 1.6 million, $ 14.4 million and $ 31.5 million, respectively, related to our lease ROU assets associated with vacating certain leased office space, which are included in Asset impairments in the Consolidated Statements of Income.

Refer to Note 4, Fair Value Measures , for more information on the lease ROU assets impairment methodology.

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We elected not to carry our Long-term debt at fair value.

We elected not to carry our debt at fair value.

The carrying value of our debt is net of related unamortized discounts and debt issuance costs.

Our total debt obligations as of August 31, 2023 and August 31, 2022 consisted of the following:

Our debt obligations as of August 31, 2024 and August 31, 2023 consisted of the following:

(in thousands) Issuance Date Contractual Maturity Date August 31, 2024 August 31, 2023

2022 Credit Agreement

2022 Term Facility 3/1/2022 3/1/2025 $ 125,000 $ —

Total unamortized debt issuance costs on Current debt ( 158 ) —

Total Current debt $ 124,842 $ —

Long-term debt

2022 Term Facility 3/1/2022 3/1/2025 — 375,000

2022 Revolving Facility 3/1/2022 3/1/2027 250,000 250,000

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Total Long-term debt $ 1,241,131 $ 1,612,700

As of August 31, 2023, annual maturities on our total debt obligations, based on contract maturity, were as follows:

$ 1,365,973 $ 1,612,700

As of August 31, 2024, annual maturities on our debt obligations, based on contractual maturity dates, were as follows:

(in thousands)

Years Ended August 31,

Fiscal Years Ended August 31,

2025 $ 125,000

Thereafter 500,000

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The 2022 Revolving Facility allows for the availability of up to $ 100.0 million in the form of letters of credit and up to $ 50.0 million in the form of swingline loans.

We may seek additional commitments under the 2022 Revolving Facility from lenders or other financial institutions up to an aggregate principal amount of $ 750.0 million.

We pay a commitment fee on the daily unused amount of the 2022 Revolving Facility using a pricing grid based on our senior unsecured non-credit enhanced long-term debt rating and our total leverage ratio.

The commitment fee remained consistent at 0.125 % from the borrowing date through August 31, 2023.

We used these borrowings, along with the net proceeds from the issuance of the Senior Notes (as defined below) and cash on hand, to finance the consideration for the CGS acquisition, to repay borrowings under the 2019 Credit Agreement (as defined below) and to pay related transaction fees, costs and expenses.

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We may seek additional commitments of up to $ 750.0 million under the 2022 Revolving Facility from lenders or other financial institutions.

We used these borrowings, along with the net proceeds from the issuance of the Senior Notes (as defined below) and cash on hand, to finance the consideration for the CGS acquisition, to repay prior outstanding borrowings and to pay related transaction fees, costs and expenses.

During fiscal 2022, we incurred approximately $ 9.5 million in debt issuance costs related to the 2022 Credit Facilities.

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Since loan inception on March 1, 2022, we have repaid $ 875.0 million under the 2022 Term Facility, inclusive of voluntary prepayments of $ 762.5 million.

As of August 31, 2023, the outstanding borrowings under the 2022 Credit Facilities bore interest at a rate equal to the applicable one-month Term SOFR rate plus a 1.1 % spread (comprised of a 1.0 % interest rate margin based on a debt leverage pricing grid plus a 0.1 % credit spread adjustment).

The spread remained consistent from the borrowing date through August 31, 2023.

From the borrowing date through November 30, 2023, the outstanding borrowings under the 2022 Credit Facilities bore interest at a rate equal to the applicable one-month Term SOFR plus a 1.1 % spread (comprised of a 1.0 % interest rate margin based on a debt leverage pricing grid plus a 0.1 % credit spread adjustment).

From December 1, 2023 through August 31, 2024, the spread decreased to 0.975 % (comprised of a 0.875 % interest rate margin based on a debt leverage pricing grid plus a 0.1 % credit spread adjustment).

Interest on the 2022 Credit Facilities is currently payable on the last business day of each month, in arrears.

Additionally, we pay a commitment fee on the daily unused amount of the 2022 Revolving Facility using a pricing grid based on our senior unsecured non-credit enhanced long-term debt rating and our total leverage ratio.

From the borrowing date through November 30, 2023, the commitment fee was 0.125 %, which subsequently decreased to 0.1 % through August 31, 2024.

The 2022 Credit Agreement contains usual and customary event of default provisions for facilities of this type, which are subject to usual and customary grace periods and materiality thresholds.

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Swap Agreements

On March 5, 2020, we entered into the 2020 Swap Agreement to hedge a portion of our then outstanding floating LIBOR rate debt with a fixed interest rate of 0.7995 %.

On March 1, 2022, we terminated the 2020 Swap Agreement and concurrently entered into the 2022 Swap Agreement to hedge a portion of our outstanding floating SOFR rate debt with a fixed interest rate of 1.162 %.

2024 Swap Agreement

On March 1, 2024, we entered into the 2024 Swap Agreement to hedge a portion of our outstanding floating SOFR debt with a fixed interest rate of 5.145 %.

2022 Swap Agreement

On March 1, 2022, we entered into the 2022 Swap Agreement to hedge a portion of our outstanding floating SOFR debt with a fixed interest rate of 1.162 %.

Effective December 30, 2022, we apportioned the then-outstanding notional amount of the 2022 Swap Agreement between two counterparties.

Refer to Note 5, Derivative Instruments for further discussion of the 2020 Swap Agreement and 2022 Swap Agreement.

The 2022 Swap Agreement matured on February 28, 2024.

2020 Swap Agreement

On March 5, 2020, we entered into the 2020 Swap Agreement to hedge a portion of our then outstanding floating LIBOR rate debt with a fixed interest rate of 0.7995 %.

On March 1, 2022, we terminated the 2020 Swap Agreement and concurrently entered into the 2022 Swap Agreement.

Refer to Note 5, Derivative Instruments for further discussion of the 2024 Swap Agreement, 2022 Swap Agreement and 2020 Swap Agreement.

On March 1, 2022, we completed a public offering of $ 500.0 million aggregate principal amount of 2.900 % Senior Notes due March 1, 2027 (the "2027 Notes") and $ 500.0 million aggregate principal amount of 3.450 % Senior Notes due March 1, 2032 (the "2032 Notes" and, together with the 2027 Notes, the "Senior Notes").

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The debt discounts and debt issuance costs are amortized to Interest expense in the Consolidated Statements of Income over the contractual term of the debt, leveraging the effective interest method.

Interest on the Senior Notes is payable semiannually in arrears on March 1 and September 1 of each year, with the first payment made on September 1, 2022.

Interest on the Senior Notes is payable semiannually in arrears on March 1 and September 1 of each year.

We may redeem the Senior Notes, in whole or in part, at any time at specified redemption prices, plus any accrued and unpaid interest.

Upon the occurrence of a change of control triggering event (as defined in the Supplemental Indenture), we must offer to repurchase the Senior Notes at 101 % of their principal amount, plus any accrued and unpaid interest.

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2019 Credit Agreement

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Interest Expense

On March 1, 2022, the 2019 Revolving Credit Facility and 2020 Swap Agreement were both terminated and concurrently replaced with the 2022 Credit Facilities, Senior Notes and 2022 Swap Agreement.

The following table presents the interest expense on our outstanding debt which is included in Interest expense in our Consolidated Statements of Income:

The following table presents the interest expense on our outstanding debt which is a component of Interest expense in our Consolidated Statements of Income:

Years Ended August 31,

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$ 65,412 $ 66,283 $ 35,152

(1) Interest expense on our outstanding debt includes the related amortization of debt issuance costs and debt discounts, net of the effects of the related interest rate swap agreements.

Including the related amortization of debt issuance costs and debt discounts, net of the effects of the related interest rate swap agreement, the year-to-date weighted average interest rate on amounts outstanding under our outstanding debt was 3.44 % and 2.02 % as of August 31, 2023 and August 31, 2022, respectively.

Refer to Note 5, Derivative Instruments for further discussion of the 2020 Swap Agreement and 2022 Swap Agreement.

(1) Interest expense on our outstanding debt includes the related amortization of debt issuance costs and debt discounts.

Interest expense is net of the effects of our interest rate swap agreements.

COMMITMENTS AND CONTINGENCIES

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We record liabilities for commitments when incurred (i.e., when the goods or services are received).

We accrue non-income-tax liabilities for contingencies when we believe that a loss is probable and the amount can be reasonably estimated.

Except for income tax contingencies, we accrue for contingencies when we believe that a loss is probable and the amount can be reasonably estimated.

Judgment is required to determine both the probability and the estimated amount of loss.

If the reasonable estimate of a probable loss is a range, we record the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount.

We review accruals on a quarterly basis and adjust, as necessary, to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other current information.

If the reasonable estimate of a probable loss is a range, we record an accrual for the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount.

We review these accruals on a quarterly basis and adjust, as necessary, to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other current information.

Contingent gains are recognized only when realized.

Uncertain income tax positions are accounted for in accordance with applicable accounting guidance, refer to Note 10, Income Taxes for further details.

Income tax contingencies related to uncertain tax positions are accounted for in accordance with applicable accounting guidance.

Refer to Note 2, Summary of Significant Accounting Policies - Income Taxes for further details.

Purchase Commitments with Suppliers and Vendors

Purchase obligations represent our legally-binding agreements to purchase fixed or minimum quantities at determinable prices.

As of August 31, 2023 and 2022, we had total purchase obligations with suppliers of $ 362.2 million and $ 373.9 million, respectively.

As of August 31, 2024 and 2023, we had total purchase obligations with suppliers and vendors of $ 382.6 million and $ 362.2 million, respectively.

Our total purchase obligations as of August 31, 2024 and 2023 primarily related to hosting services, acquisition of data and, to a lesser extent, third-party software providers.

Hosting services support our hybrid cloud strategy, the majority of which rely on third-party hosting providers.

Data is an integral component of the value we provide to our clients, and our commitments to third-party software providers mainly include internal-use software licenses.

We also have contractual obligations related to our lease liabilities and outstanding debt.

Refer to Note 11, Leases and Note 12, Debt, for information regarding lease commitments and outstanding debt obligations, respectively.

Capital Commitments

As of August 31, 2023 and 2022, we had outstanding capital commitments related to an investment of $ 0.7 million and $ 1.1 million, respectively.

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Letters of Credit

From time to time, we are required to obtain letters of credit in the ordinary course of business.

As of August 31, 2023 and 2022, we had approximately $ 0.6 million and $ 0.5 million of standby letters of credit outstanding, respectively.

As of August 31, 2024 and 2023, we had $ 0.4 million and $ 0.6 million of standby letters of credit outstanding, respectively.

No liabilities related to these arrangements are reflected in the Consolidated Balance Sheets.

Our 2022 Revolving Facility allows for the availability of up to $ 100.0 million in the form of letters of credit, which were unused as of both August 31, 2023 and August 31, 2022.

Our 2022 Revolving Facility allows for the availability of up to $ 100.0 million in the form of letters of credit.

We have not obtained any letters of credit under the 2022 Revolving Facility since its inception.

Refer to Note 12, Debt, for information regarding the 2022 Revolving Facility.

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On June 22, 2023, we filed an Application for Abatement with the Commonwealth disputing all amounts assessed, which was subsequently denied.

We are filing petitions with the Appellate Tax Board to appeal all amounts assessed by the Commonwealth and believe that we will ultimately prevail;

On February 20, 2024, we received a "Notice of Selection for Audit" for sales tax for the period from July 1, 2021 through December 31, 2023.

We have filed petitions with the Appellate Tax Board to appeal the amounts assessed by the Commonwealth and, should this matter proceed further, we believe that we would prevail on all or most of the matters under dispute;

however, if we do not prevail, the amount of these assessments could have a material impact on our consolidated financial position, results of operations and cash flows.

We have concluded that some payment to the Commonwealth is probable.

We have recorded an accrual which is not material to our consolidated financial statements.

While we believe that the assumptions and estimates used to determine the accrual are reasonable, future developments could result in adjustments being made to this accrual.

During the fourth quarter of fiscal 2024, we took a charge of approximately $ 54 million related to this dispute and subsequently, in September 2024, we made the corresponding payment of $ 54 million to the Commonwealth.

In addition to reserves taken in prior fiscal years, this brings our total charge with respect to this matter to approximately $ 64 million.

While we do not anticipate taking additional material charges with respect to this matter, and we believe that the assumptions and estimates used to determine the charge are reasonable, future developments could result in adjustments being made to this amount.

Indemnifications

As permitted or required under Delaware law and to the maximum extent allowable under that law, we have certain obligations to indemnify each of our current and former officers and directors for certain events or occurrences while the officer or director is, or was, serving at our request in such capacity.

These indemnification obligations are valid as long as the director or officer acted in good faith and in a manner the person reasonably believed to be in, or not opposed to, the best interests of FactSet, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.

with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.

It is not possible to determine the maximum potential amount for claims made under the indemnification obligations due to the unique set of facts and circumstances likely to be involved in each particular claim and indemnification provision;

however, we have purchased a director and officer insurance policy that mitigates our exposure and may enable us to recover a portion of any

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future amounts paid.

however, we have purchased a director and officer insurance policy that mitigates our exposure and may enable us to recover a portion of any future amounts paid.

We do not believe, based on historical experience and information currently available, that it is probable that any material amounts will be required to be paid under such indemnification obligations.

STOCKHOLDERS' EQUITY

The following table presents the shares of common stock repurchased under our share repurchase program and acquired from holders of our stock-based awards upon vesting to satisfy tax withholding requirements:

Share Repurchases

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537,800 430,350 46,200

Total cost of shares repurchased (1)(2)

Total cost of common stock repurchased under the share repurchase program (1)

$ 235,235 $ 176,720 $ 18,639

(1) Amounts do not include the fiscal 2023, 2022 and 2021 repurchases of 32,444 shares ($ 13.7 million), 14,489 shares ($ 6.2 million) and 12,932 shares ($ 4.3 million) of common stock, respectively, primarily to satisfy tax withholding obligations due upon the vesting of stock-based awards.

(2) For fiscal 2023, amount excludes a 1% excise tax of $ 0.9 million on corporate stock repurchases required under the IRA for publicly traded U.S.

Repurchases of common stock to satisfy tax withholding requirements due upon vesting of stock-based awards 37,589 32,444 14,489

Total cost of repurchases of common stock to satisfy withholding requirements due upon vesting of stock-based awards $ 16,659 $ 13,710 $ 6,159

(1) For fiscal 2024 and 2023, amount excludes a 1% excise tax of $ 1.7 million and $ 0.9 million, respectively, on corporate stock repurchases required under the IRA for publicly traded U.S.

corporations after December 31, 2022.

We may repurchase shares of our common stock under our share repurchase program from time-to-time in the open market and via privately negotiated transactions, subject to market conditions.

We may repurchase shares of our common stock under our share repurchase program from time-to-time in the open market or via privately negotiated transactions, subject to market conditions.

We suspended our share repurchase program beginning in the second quarter of fiscal 2022, with the exception of potential minor repurchases to offset dilution from grants of equity awards or repurchases to satisfy withholding tax obligations due upon the vesting of stock-based awards, to prioritize the repayment of debt under the 2022 Credit Facilities.

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There is no defined number of shares to be repurchased over a specified timeframe through the life of our share repurchase program.

As of August 31, 2023, we had $ 4.5 million authorized under our share repurchase program for future share repurchases, which was not available for use after August 31, 2023.

On June 20, 2023, our Board of Directors authorized up to $ 300.0 million for share repurchases on or after September 1, 2023.

We had $ 64.8 million that remained authorized under our share repurchase program as of August 31, 2024, all of which expired upon the conclusion of fiscal 2024 and was not available for share repurchases after that date.

On September 17, 2024, our Board of Directors authorized up to $ 300 million for share repurchases, which will be available during fiscal 2025.

Refer to Part II, Item 5.

Market For Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities , of this Annual Report on Form 10-K for further discussion on our share repurchase program.

In addition to our share repurchase program, we also acquire shares of our common stock from holders of our stock-based awards to satisfy withholding tax requirements due at vesting.

Shares acquired from these holders do not reduce the amount authorized for repurchase under the share repurchase program.

Equity-based Awards

Refer to Note 16, Stock-Based Compensation for more information on equity awards issued during fiscal 2022 through fiscal 2024.

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Our Board of Directors approved the following dividends:

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In the third quarter of fiscal 2024, our Board of Directors approved a 6 % increase in the regular quarterly dividend from $ 0.98 to $ 1.04 per share.

Future cash dividend payments will depend on our earnings, capital requirements, financial condition and other factors considered relevant by us and are subject to final determination by our Board of Directors.

Future cash dividend payments are subject to final determination by our Board of Directors and will depend on our earnings, capital requirements, financial condition and other relevant factors.

Accumulated Other Comprehensive Loss

The components of AOCL are as follows:

The components of AOCL as of August 31, 2024 and August 31, 2023 were as follows:

(in thousands) August 31, 2024 August 31, 2023

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EARNINGS PER SHARE

Basic earnings per common share ("Basic EPS") is computed by dividing net income by the number of weighted average common shares outstanding during the year.

Diluted earnings per common share ("Diluted EPS") is computed using the treasury stock method, by dividing net income by the cumulative weighted average common shares that are outstanding or are issuable upon the exercise of outstanding stock-based compensation awards during the year.

Stock-based compensation awards that are out-of-the-money and PSUs in which the performance criteria have not been met as of the end of the respective fiscal year are omitted from the calculation of Diluted EPS.

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A reconciliation of the weighted average shares outstanding used in the Basic EPS and Diluted EPS computation is as follows:

Basic earnings per common share ("Basic EPS") is computed by dividing net income by the number of weighted average common shares outstanding during the fiscal year.

Diluted earnings per common share ("Diluted EPS") is calculated by using the treasury stock method which assumes the issuance of common stock for all potentially dilutive stock-based awards.

The following is a reconciliation of our Basic and Diluted EPS computations:

Years Ended August 31,

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Weighted average common shares used in the calculation of Basic EPS 38,059 38,194 37,864

Common stock equivalents associated with stock-based compensation plan (1)

Common stock equivalents associated with stock-based compensation plans

Shares used in the calculation of Diluted EPS 38,618 38,898 38,736

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Diluted EPS $ 13.91 $ 12.04 $ 10.25

(1) Dilutive potential common shares consist of stock options and unvested PSUs.

As of August 31, 2023, 2022 and 2021, we excluded a respective 566,173 , 329,189 and 1,750 common stock equivalents related to stock options from our calculation of Diluted EPS.

As of August 31, 2023, 2022 and 2021, we excluded a respective 59,478 , 60,725 and 68,990 common stock equivalents related to PSUs from our calculation of Diluted EPS.

The following table presents the potential common shares that were excluded from Diluted EPS as they relate to stock-based awards that were antidilutive or subject to performance conditions which have not been satisfied by the end of the reporting period:

Years Ended August 31,

(in thousands)

2024 2023 2022

Stock options

Restricted Stock Awards

STOCK-BASED COMPENSATION

We measure and recognize stock-based compensation for all stock-based awards granted to our employees and non-employee directors based on their estimated grant date fair value.

We recognized total stock-based compensation expense of $ 62.0 million, $ 56.0 million and $ 45.1 million in fiscal 2023, 2022 and 2021, respectively.

There was no stock-based compensation capitalized as of August 31, 2023 and 2022.

As of August 31, 2023, $ 114.5 million of total unrecognized compensation expense related to non-vested stock-based awards is expected to be recognized over a weighted average vesting period of 2.9 years.

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Our stock-based compensation expense consists of stock options, RSUs, PSUs and purchases of common stock under the ESPP.

Stock-based Compensation Expense

The following table presents the stock-based compensation expense for the fiscal years presented:

Years Ended August 31,

(in thousands)

2024 2023 2022

Stock-based compensation expense

$ 63,501 $ 62,038 $ 56,003

There were no stock-based compensation costs capitalized during fiscal 2022 through fiscal 2024.

As of August 31, 2024, $ 123.0 million of total unrecognized stock-based compensation expense related to non-vested stock-based awards is expected to be recognized over the remaining weighted average vesting period of 2.8 years.

Stock Option Awards

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(2) The total pre-tax intrinsic value of stock options exercised during fiscal 2024, 2023 and 2022 was $ 89.5 million, $ 77.5 million and $ 104.1 million, respectively.

(3) As of August 31, 2023, a total of 1,987,662 shares underlying the stock option awards were unvested and outstanding, which results in unamortized stock-based compensation of $ 59.1 million to be recognized as stock-based compensation expense over the remaining weighted average vesting period of 3.1 years.

(3) As of August 31, 2024, 1,822,913 shares underlying the stock option awards were unvested and outstanding, resulting in unamortized stock-based compensation expense of $ 53.0 million that is expected to be recognized over the remaining weighted average vesting period of 3.0 years.

Employee Stock Option Awards

S tock options are granted to our employees under the FactSet Research Systems Inc.

Stock Option and Award Plan as Amended and Restated (the "LTIP").

The majority of our employee stock options granted under the LTIP for fiscal 2021 through fiscal 2023 relate to our annual grants on November 1, 2022, November 1, 2021 and November 9, 2020.

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The following table includes the weighted average inputs to the binomial model to estimate the grant-date fair value of the employee stock options granted:

The majority of our employee stock options granted for fiscal 2024, 2023 and 2022 relate to our annual grants on November 1, 2023, November 1, 2022 and November 1, 2021, respectively.

The following table presents the weighted average inputs used in the binomial model to estimate the grant-date fair value of the employee stock options granted:

2024 2023 2022

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Weighted average grant date fair value $ 132.59 $ 125.57 $ 103.49

$ 125.57 $ 103.49 $ 78.31

Weighted average exercise price $ 436.61 $ 426.22 $ 433.09

$ 426.22 $ 433.09 $ 317.17

(1) Includes the annual employee grant on November 1, 2023, November 1, 2022 and November 1, 2021 of 242,371 , 266,051 and 292,377 stock options, respectively.

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Restricted Stock Awards

We refer to RSUs and PSUs, collectively, as "Restricted Stock Awards".

A summary of Restricted Stock Award activity is as follows:

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Granted – employee Restricted Stock Awards (1)

Vested - employee RSUs ( 35 ) $ 208.67

( 13 ) $ 267.23

Granted – non-employee directors RSUs 2 $ 425.29

Vested ( 40 ) $ 242.87

Forfeited ( 29 ) $ 323.16

Balance at August 31, 2022 233 $ 338.87

Granted – employee Restricted Stock Awards (1)

Granted - non-employee dire ctors RSUs

Vested - employee Restricted Stock Awards ( 40 ) $ 242.87

( 29 ) $ 323.16

Performance adjustment – employee PSUs (2)

Granted – non-employee directors RSUs 2 $ 425.06

Vested ( 83 ) $ 291.80

Forfeited ( 14 ) $ 369.71

Balance at August 31, 2023 244 $ 381.15

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Performance adjustment – employee PSUs (2)

Granted - non-employee dire ctors RSUs

Vested - Restricted Stock Awards ( 83 ) $ 291.80

( 14 ) $ 369.71

Balance at August 31, 2023 244 (3)

Granted – non-employee directors RSUs

Vested ( 95 ) $ 330.00

Forfeited ( 14 ) $ 405.37

Outstanding as of August 31, 2024 262 (3)

(1) During fiscal 2024, 2023 and 2022, we granted 74,456 RSUs and 37,008 PSUs;

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and 71,978 RSUs and 30,704 PSUs, respectively.

(2) During fiscal 2023, there were an additional 8,542 PSUs granted that related to the achievement of specified performance levels included in a 2019 grant.

(3) As of August 31, 2023, a total of 243,552 shares underlying the Restricted Stock Awards were unvested and outstanding, which resulted in unamortized stock-based compensation of $ 55.4 million to be recognized as stock-based compensation expense over the remaining weighted average vesting period of 2.7 years.

(2) Additional PSUs were granted during fiscal 2024 and 2023 based on performance above the specified target level of achievement for PSUs granted on November 9, 2020 and November 1, 2019, respectively.

(3) As of August 31, 2024, 261,639 shares underlying the Restricted Stock Awards were unvested and outstanding, which resulted in unamortized stock-based compensation expense of $ 70.0 million that is expected to be recognized over the remaining weighted average vesting period of 2.6 years.

Employee Restricted Stock Awards

Restricted Stock Awards are granted to our employees under the LTIP.

These awards entitle the holders to shares of common stock as the Restricted Stock Awards vests, but not to dividends declared on the underlying shares while the stock subject to the Restricted Stock Awards is unvested.

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Our Restricted Stock Awards granted during fiscal 2021 through fiscal 2023 primarily relate to our annual grants on November 1, 2022, November 1, 2021 and November 9, 2020.

The majority of the RSUs included in each these grants vest 20 % annually on the anniversary date of the grant and are fully vested after five years .

The PSUs included in each of these grants cliff vest on the third anniversary of the grant date, subject to the achievement of certain performance metrics.

The ultimate number of common shares that may be earned pursuant to these PSU awards in each year range from 0 % to 150 % of the number of target shares, depending on the level of achievement of the stated financial performance objectives.

Employee Stock Purchase Plan

Shares of FactSet common stock may be purchased by eligible employees under our ESPP in three-month intervals.

The purchase price is equal to 85 % of the lesser of the fair market value of our common stock on the first day or the last day of each three-month offering period.

Employee purchases may not exceed 10 % of their gross compensation and there is a $ 25,000 contribution limit per employee for each calendar year .

Shares purchased through our ESPP cannot be sold or otherwise transferred for 18 months after purchase.

Dividends paid on shares held in our ESPP are used to purchase additional ESPP shares at the market price on the dividend payment date.

During fiscal 2023, employees purchased 39,873 shares at a weighted average price of $ 348.55 , compared with 36,244 shares at a weighted average price of $ 332.30 in fiscal 2022, and 38,848 shares at a weighted average price of $ 273.59 in fiscal 2021.

Stock-based compensation expense related to our ESPP was $ 2.7 million, $ 2.3 million and $ 2.0 million for fiscal 2023, 2022 and 2021, respectively.

At August 31, 2023, our ESPP had 62,839 shares reserved for future issuance.

The weighted average estimated fair value of our ESPP shares during fiscal 2023, 2022 and 2021 was $ 71.74 , $ 66.35 and $ 54.00 per share, respectively.

The majority of our employee Restricted Stock Awards granted for fiscal 2024, 2023 and 2022 relate to our annual grants on November 1, 2023, November 1, 2022 and November 1, 2021, respectively.

These awards entitle the holders to shares of common stock as the Restricted Stock Awards vest, but not to dividends declared on the underlying shares while the stock subject to the Restricted Stock Awards is unvested.

The majority of the RSUs granted vest 20 % annually on the anniversary date of the grant and are fully vested after five years .

The majority of the PSUs granted cliff vest on the third anniversary of the grant date.

The ultimate number of common shares that may be earned pursuant to our PSU awards depends on the level of our achievement of stated financial performance objectives.

The achievement range was 0 % to 200 % for the November 1, 2023 annual grant and 0 % to 150 % for the November 1, 2022 and November 1, 2021 annual grants.

Stock-based Awards Available for Grant

A summary of stock-based awards available for grant is as follows:

(in thousands) Stock-based Awards

Available for Grant under the

Stock-based Awards

Available for Grant under the

FactSet Research Systems Inc.

Non-Employee Directors’ Stock Option and Award Plan as Amended and Restated (the “Director Plan”)

Balance at August 31, 2020 5,626 250

Granted - stock option awards ( 418 ) ( 12 )

Granted - RSUs (1)

Granted - PSUs (1)

Forfeited - stock-based awards (1)

Balance at August 31, 2021 5,080 238

Granted - stock option awards ( 348 ) ( 6 )

Granted - RSUs (1)

( 180 ) ( 4 )

Granted - PSUs (1)

Forfeited - stock-based awards (1)

Balance at August 31, 2022 4,669 232

Granted - stock option awards ( 268 ) ( 5 )

Granted - RSUs (1)

( 158 ) ( 4 )

Granted - PSUs (1)

Performance adjustment - PSUs (2)

Forfeited - stock-based awards (1)

Balance at August 31, 2023 4,226 223

(1) Under the LTIP, for each Restricted Stock Award granted or canceled/forfeited, an equivalent of 2.5 shares is deducted from or added back to, respectively, the aggregate number of stock-based awards available for grant .

(2) During fiscal 2023, there were additional PSUs granted that related to the achievement of specified performance levels included in a 2019 grant.

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As of August 31, 2024, we had 3.7 million employee stock-based awards available for grant under the LTIP and 0.2 million non-employee director stock-based awards available for grant under the Director Plan.

In accordance with the LTIP and Director Plan, each Restricted Stock Award granted or canceled/forfeited is equivalent to 2.5 shares deducted from or added back to, respectively, the aggregate number of stock-based awards available for grant.

EMPLOYEE BENEFIT PLANS

Defined Contribution Plan

We established our 401(k) Plan in fiscal 1993.

The 401(k) Plan is a defined contribution plan covering all full-time, U.S.

employees of FactSet and is subject to the provisions of the Employee Retirement Income Security Act of 1974 and the Internal Revenue Code of 1986 ("IRC").

Each year, participants may contribute up to 60 % of their eligible annual compensation, subject to annual limitations established by the IRC.

Our 401(k) Plan is a defined contribution plan covering all full-time, U.S.

employees of FactSet and is subject to the provisions of the Employee Retirement Income Security Act of 1974 and the Code.

Each year, participants may contribute up to 60 % of their eligible annual compensation, subject to annual limitations established by the Code.

We match up to 4 % of employees’ earnings, capped at the Internal Revenue Service annual maximum.

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Operating segments are defined as components of an enterprise that have the following characteristics:

(i) they engage in business activities from which they may earn revenue and incur expense, (ii) their operating results are regularly reviewed by the chief operating decision maker ("CODM") for resource allocation decisions and performance assessment, and (iii) their discrete financial information is available.

(i) they engage in business activities from which they may earn revenue and incur expense, (ii) their operating results are regularly reviewed by the CODM for resource allocation decisions and performance assessment, and (iii) their discrete financial information is available.

Our Chief Executive Officer functions as our CODM.

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Americas, EMEA and Asia Pacific.

This is how we and our CODM manage our business and the geographic markets in which we operate.

This is how our CODM manages our business and the geographic markets in which we operate.

These operating segments are consistent with our reportable segments.

The Americas segment serves our clients throughout North, Central, and South America.

The EMEA segment serves our clients in Europe, the Middle East, and Africa.

The Asia Pacific segment serves our clients in Asia and Australasia.

Segment revenues reflect sales to our clients based on their respective geographic locations.

The Americas segment primarily sells to clients throughout North, Central, and South America.

The EMEA segment primarily sells to clients in Europe, the Middle East, and Africa.

The Asia Pacific segment primarily sells to clients in Asia and Australasia.

Segment revenues reflect sales to our clients based on the geographic region where the sale originated.

Each segment records expenses related to its individual operations with the exception of expenditures associated with our data centers, third-party data costs and corporate headquarters charges, which are recorded by the Americas segment and are not allocated to the other segments.

The expenses incurred at our content collection centers, located in India, the Philippines and Latvia, are allocated to each segment based on their respective percentage of revenues as this reflects the benefits provided to each segment.

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Intercompany revenue and expense amounts have been eliminated within each segment in order to report on the basis that management uses internally for evaluating segment performance.

The following tables reflect the results of operations of our segments:

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Year Ended August 31, 2024 Americas EMEA Asia Pacific Total

$ 1,335,484 $ 539,843 $ 210,181 $ 2,085,508

Revenues $ 1,419,901 $ 563,128 $ 220,027 $ 2,203,056

Operating income (1)

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Year Ended August 31, 2023 Americas EMEA Asia Pacific Total

$ 1,173,946 $ 484,279 $ 185,667 $ 1,843,892

Revenues $ 1,335,484 $ 539,843 $ 210,181 $ 2,085,508

Operating income (1)

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Year Ended August 31, 2022 Americas EMEA Asia Pacific Total

$ 1,008,046 $ 427,700 $ 155,699 $ 1,591,445

Revenues $ 1,173,946 $ 484,279 $ 185,667 $ 1,843,892

Operating income (1)

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(1) Includes asset impairment charges further disclosed in the Segment Asset Impairments section below.

(2) The Americas includes CGS intangible asset amortization of $ 53.7 million and $ 26.8 million during fiscal 2023 and 2022 , respectively.

(3) Capital expenditures includes purchases of PPE and capitalized internal-use software.

(2) Capital expenditures include purchases of PPE and capitalized internal-use software.

Segment Asset Impairments

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Total asset impairments $ 1,234 $ — $ 3,443 $ 4,677

$ 18,937 $ 7,009 $ — $ 25,946

Year Ended August 31, 2023 Americas EMEA Asia Pacific Total

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Total asset impairments $ 18,937 $ 7,009 $ — $ 25,946

Year Ended August 31, 2022 Americas EMEA Asia Pacific Total

Lease ROU assets and PPE (1)

$ 57,647 $ 4,237 $ 321 $ 62,205

(1) Asset impairments of our lease ROU assets and related PPE associated with vacating certain leased office space to resize our real estate footprint for the hybrid work environment.

Intangible assets (2)

2,067 — — 2,067

Total asset impairments $ 59,714 $ 4,237 $ 321 $ 64,272

(1) Asset impairments of our lease ROU assets and related PPE associated with vacating certain leased office space to rightsize our real estate footprint.

See Note 4, Fair Value Measures, Note 7, Property, Equipment and Leasehold Improvements and Note 11, Leases for additional information.

(2) Asset impairments related to Trade names and Developed technology for fiscal 2023 and Developed technology for fiscal 2022.

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(2) Asset impairments related to Developed technology for fiscal 2024, Developed technology and Trade names for fiscal 2023 and Developed technology for fiscal 2022.

Segment Total Assets

21 unchanged sentences

The following table sets forth long-lived assets by geographic area.

Long-lived assets consist of Property, equipment and leasehold improvements, net and Lease right-of-use assets, net and excludes goodwill, intangible assets, deferred taxes and other assets.

Long-lived assets consist of PPE, net and Lease ROU assets, net and excludes goodwill, intangible assets, deferred taxes and other assets.

(in thousands) August 31,

6 unchanged sentences

Total long-lived assets $ 213,007 $ 227,944

SUBSEQUENT EVENTS

On October 24, 2024, we agreed to acquire all of the outstanding shares of Platform Group Limited (“Irwin”) for a purchase price of $ 125.0 million on a cash-free, debt-free basis, subject to working capital adjustments.

Irwin is a leading investor relations and capital markets platform for public companies and their advisors.

We agreed to acquire Irwin to scale and expand our ability to offer workflow solutions to investor relations professionals.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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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-K

Item 8. Financial Statements and Supplementary Data