MORNINGSTAR, INC., 10-K filed on 2/27/2015
Annual Report
Document and Entity Information Document (USD $)
In Billions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Feb. 20, 2015
Jun. 30, 2014
Document and Entity Information Abstract
 
 
 
Entity Registrant Name
MORNINGSTAR, INC. 
 
 
Entity Central Index Key
0001289419 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
Document Type
10-K 
 
 
Document Period End Date
Dec. 31, 2014 
 
 
Document Fiscal Year Focus
2014 
 
 
Document Fiscal Period Focus
FY 
 
 
Amendment Flag
false 
 
 
Entity Common Stock, Shares Outstanding
 
44,354,426 
 
Entity Well-known Seasoned Issuer
Yes 
 
 
Entity Voluntary Filers
No 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Public Float
 
 
$ 1.4 
Condensed Consolidated Statements of Income (USD $)
In Thousands, except Per Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Revenue
$ 760,071 
$ 698,266 
$ 658,288 
Operating expense:
 
 
 
Cost of revenue
318,638 
271,437 
246,783 
Sales and marketing
111,088 
103,614 
108,884 
General and administrative
108,865 
106,868 
108,857 
Depreciation and amortization
54,886 
45,693 
43,096 
Gain (Loss) Related to Litigation Settlement
61,000 
Total operating expense
654,477 
527,612 
507,620 
Operating income
105,594 
170,654 
150,668 
Non-operating income (expense):
 
 
 
Interest income, net
2,050 
2,712 
5,153 
Gain (loss) on sale of investments reclassified from other comprehensive income
1,018 
4,207 
538 
Equity Method Investments Holding Gain
5,168 
3,635 
Other income (expense), net
68 
(3,198)
(2,734)
Non-operating income (expense), net
8,304 
7,356 
2,957 
Income before income taxes and equity in net income of unconsolidated entities
113,898 
178,010 
153,625 
Income tax expense
35,678 
56,031 
52,878 
Equity in net income of unconsolidated entities
39 
1,428 
2,027 
Consolidated Net Income from Continuing Operations
78,259 
123,407 
102,774 
Gain on Sale of Discontinued Operation, Net of Tax
5,188 
Consolidated net income
78,259 
123,407 
107,962 
Net (income) loss attributable to the noncontrolling interest
42 
122 
117 
Net income attributable to Morningstar, Inc.
78,301 
123,529 
108,079 
Net Income from Continuing Operations, net of tax
78,301 
123,529 
102,891 
Net Income from Discontinued Operations, Net of Tax
$ 0 
$ 0 
$ 5,188 
Net income per share attributable to Morningstar, Inc.:
 
 
 
Basic (in dollars per share)
$ 1.75 
$ 2.68 
$ 2.23 
Diluted (in dollars per share)
$ 1.74 
$ 2.66 
$ 2.20 
Income (Loss) from Discontinued Operations, Net of Tax, Per Diluted Share
$ 0.00 
$ 0.00 
$ 0.10 
Income (Loss) from Continuing Operations, Per Diluted Share
$ 1.74 
$ 2.66 
$ 2.10 
Income (Loss) from Discontinued Operations, Net of Tax, Per Basic Share
$ 0.00 
$ 0.00 
$ 0.11 
Income (Loss) from Continuing Operations, Per Basic Share
$ 1.75 
$ 2.68 
$ 2.12 
Dividends per common share:
 
 
 
Dividends declared per common share
$ 0.700 
$ 0.545 
$ 0.425 
Dividends paid per common share
$ 0.680 
$ 0.375 
$ 0.525 
Weighted average shares outstanding:
 
 
 
Basic (in shares)
44,675 
46,158 
48,497 
Diluted (in shares)
44,901 
46,491 
49,148 
Consolidated Consolidated Statements of Comprehensive Income (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Consolidated net income
$ 78,259 
$ 123,407 
$ 107,962 
Other comprehensive income (loss), net of tax:
 
 
 
Foreign currency translation adjustment
(29,793)
(4,539)
6,838 
Unrealized gains (losses) on securities:
 
 
 
Unrealized holding gains (losses) arising during period
420 
2,408 
1,455 
Reclasification of (gains) losses included in net income
(643)
(2,631)
(344)
Other comprehensive income (loss)
(30,016)
(4,762)
7,949 
Comprehensive income
48,243 
118,645 
115,911 
Comprehensive (income) loss attributable to noncontrolling interest
131 
345 
268 
Comprehensive income attributable to Morningstar, Inc.
$ 48,374 
$ 118,990 
$ 116,179 
Condensed Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Current assets:
 
 
Cash and cash equivalents
$ 185,150 
$ 168,160 
Investments
39,422 
130,407 
Accounts receivable, less allowance of $1,520 and $1,089, respectively
136,735 
114,131 
Deferred tax asset, net
9,000 
3,892 
Income tax receivable, net
6,870 
3,942 
Other
22,596 
26,361 
Total current assets
399,773 
446,893 
Property, equipment, and capitalized software, net
117,561 
104,986 
Investments in unconsolidated entities
28,798 
38,714 
Goodwill
370,054 
326,450 
Intangible assets, net
95,905 
103,909 
Other assets
7,190 
9,716 
Total assets
1,019,281 
1,030,668 
Current liabilities:
 
 
Accounts payable and accrued liabilities
34,268 
42,131 
Accrued compensation
80,476 
71,403 
Deferred revenue
145,979 
149,225 
Short-term Debt
30,000 
Other
3,036 
6,786 
Total current liabilities
293,759 
269,545 
Accrued compensation
7,946 
8,193 
Deferred tax liability, net
25,978 
23,755 
Deferred rent
26,390 
23,938 
Other long-term liabilities
10,810 
13,947 
Total liabilities
364,883 
339,378 
Morningstar, Inc. shareholders' equity:
 
 
Common stock, no par value, 200,000,000 shares authorized, of which 44,345,763 and 44,967,423 shares were outstanding as of December 31, 2014 and December 31, 2013, respectively
Treasury stock at cost, 8,257,214 shares as of December 31, 2014 and 7,202,896 shares as of December 31, 2013
(524,356)
(449,054)
Additional paid-in capital
561,075 
539,507 
Retained earnings
641,527 
594,626 
Accumulated other comprehensive income (loss):
 
 
Currency translation adjustment
(25,095)
4,609 
Unrealized gain (loss) on available-for-sale investments
341 
564 
Total accumulated other comprehensive income
(24,754)
5,173 
Total Morningstar, Inc. shareholders' equity
653,496 
690,257 
Noncontrolling interest
902 
1,033 
Total equity
654,398 
691,290 
Total liabilities and equity
$ 1,019,281 
$ 1,030,668 
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Statement of Financial Position [Abstract]
 
 
Allowance for Doubtful Accounts Receivable, Current
$ 1,520 
$ 1,089 
Common Stock, No Par Value
$ 0 
$ 0 
Common Stock, Shares Authorized
200,000,000 
200,000,000 
Common Stock, Shares, Outstanding
44,345,763 
44,967,423 
Treasury Stock, Shares
8,257,214 
7,202,896 
Condensed Consolidated Statement of Equity (USD $)
In Thousands, except Share data, unless otherwise specified
Total
Common Stock
Treasury Stock
Additional Paid-In Capital
Retained Earnings
Accumulated Other Comprehensive Income (Loss)
Non Controlling Interests
Balance at Dec. 31, 2011
$ 857,016 
$ 5 
$ (46,701)
$ 491,432 
$ 409,022 
$ 1,612 
$ 1,646 
Balance (in shares) at Dec. 31, 2011
 
50,083,940 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity
 
 
 
 
 
 
 
Net income (loss)
107,962 
 
 
 
108,079 
 
(117)
Other Comprehensive Income (loss)
 
 
 
 
 
 
 
Unrealized gain on available-for-sale investments, net of income tax
1,455 
 
 
 
 
1,455 
Reclassification of adjustments for gains included in net income, net of income tax
(344)
 
 
 
 
(344)
Foreign currency translation adjustment, net
6,838 
 
 
 
 
6,989 
(151)
Other comprehensive income (loss)
7,949 
 
 
 
 
8,100 
(151)
Issuance of common stock related to stock-option exercises and vesting of restricted stock units, net
4,809 
1,342 
3,467 
 
 
 
Issuance of common stock related to stock-option exercises and vesting of restricted stock units, net (in shares)
 
715,888 
 
 
 
 
 
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition [Abstract]
 
 
 
 
 
 
 
Stock-based compensation - restricted stock units
13,451 
 
 
13,451 
 
 
 
Stock-based compensation - restricted stock
5,013 
 
 
5,013 
 
 
 
Stock-based compensation - stock options
441 
 
 
441 
 
 
 
Excess tax benefit derived from stock-option exercises and vesting of restricted stock units
7,210 
 
 
7,210 
 
 
 
Noncontrolling Interest, Increase from Subsidiary Equity Issuance
 
 
 
 
 
Dividends declared - common shares outstanding
(20,420)
 
 
 
(20,420)
 
 
Dividends declared - restricted stock units
(56)
 
 
271 
(327)
 
 
Common share repurchased
(256,480)
 
(256,480)
 
 
 
 
Common share repurchased (in shares)
 
(4,258,257)
 
 
 
 
 
Balance at Dec. 31, 2012
726,895 
(301,839)
521,285 
496,354 
9,712 
1,378 
Balance (in shares) at Dec. 31, 2012
 
46,541,571 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity
 
 
 
 
 
 
 
Net income (loss)
123,407 
 
 
 
123,529 
 
(122)
Other Comprehensive Income (loss)
 
 
 
 
 
 
 
Unrealized gain on available-for-sale investments, net of income tax
2,408 
 
 
 
 
2,408 
Reclassification of adjustments for gains included in net income, net of income tax
(2,631)
 
 
 
 
(2,631)
Foreign currency translation adjustment, net
(4,539)
 
 
 
 
(4,316)
(223)
Other comprehensive income (loss)
(4,762)
 
 
 
 
(4,539)
(223)
Issuance of common stock related to stock-option exercises and vesting of restricted stock units, net
(1,275)
 
1,633 
(2,908)
 
 
 
Issuance of common stock related to stock-option exercises and vesting of restricted stock units, net (in shares)
 
437,263 
 
 
 
 
 
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition [Abstract]
 
 
 
 
 
 
 
Stock-based compensation - restricted stock units
14,163 
 
 
14,163 
 
 
 
Stock-based compensation - restricted stock
388 
 
 
388 
 
 
 
Stock-based compensation - stock options
492 
 
 
492 
 
 
 
Excess tax benefit derived from stock-option exercises and vesting of restricted stock units
5,898 
 
 
5,898 
 
 
 
Dividends declared - common shares outstanding
(24,977)
 
 
 
(24,977)
 
 
Dividends declared - restricted stock units
(91)
 
 
189 
(280)
 
 
Common share repurchased
(148,848)
   
(148,848)
 
 
 
 
Common share repurchased (in shares)
 
(2,011,411)
 
 
 
 
 
Balance at Dec. 31, 2013
691,290 
(449,054)
539,507 
594,626 
5,173 
1,033 
Balance (in shares) at Dec. 31, 2013
44,967,423 
44,967,423 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity
 
 
 
 
 
 
 
Net income (loss)
78,259 
 
 
 
78,301 
 
(42)
Other Comprehensive Income (loss)
 
 
 
 
 
 
 
Unrealized gain on available-for-sale investments, net of income tax
420 
 
 
 
 
420 
Reclassification of adjustments for gains included in net income, net of income tax
(643)
 
 
 
 
(643)
Foreign currency translation adjustment, net
(29,793)
 
 
 
 
(29,704)
(89)
Other comprehensive income (loss)
(30,016)
 
 
 
 
(29,927)
(89)
Issuance of common stock related to stock-option exercises and vesting of restricted stock units, net
805 
 
1,429 
(624)
 
 
 
Issuance of common stock related to stock-option exercises and vesting of restricted stock units, net (in shares)
 
452,344 
 
 
 
 
 
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition [Abstract]
 
 
 
 
 
 
 
Stock-based compensation - restricted stock units
16,307 
 
 
16,307 
 
 
 
Stock-based compensation - restricted stock
388 
 
 
388 
 
 
 
Adjustments to Additional Paid in Capital, Share-based Compensation, Other Long-term Incentive Plans, Requisite Service Period Recognition
505 
 
 
505 
 
 
 
Stock-based compensation - stock options
424 
 
 
424 
 
 
 
Excess tax benefit derived from stock-option exercises and vesting of restricted stock units
4,449 
 
 
4,449 
 
 
 
Dividends declared - common shares outstanding
(31,211)
 
 
 
(31,211)
 
 
Dividends declared - restricted stock units
(70)
 
 
119 
(189)
 
 
Common share repurchased
(76,732)
(1)
(76,731)
 
 
 
 
Common share repurchased (in shares)
 
(1,074,004)
 
 
 
 
 
Balance at Dec. 31, 2014
$ 654,398 
$ 4 
$ (524,356)
$ 561,075 
$ 641,527 
$ (24,754)
$ 902 
Balance (in shares) at Dec. 31, 2014
44,345,763 
44,345,763 
 
 
 
 
 
Condensed Consolidated Statement of Equity (Parenthetical) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Statement of Stockholders' Equity [Abstract]
 
 
 
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax
$ 236 
$ 1,469 
$ 614 
Other Comprehensive Income (Loss), Reclassification Adjustment for Sale of Securities Included in Net Income, Tax
$ 375 
$ 1,576 
$ 194 
Condensed Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Operating activities
 
 
 
Consolidated net income
$ 78,259 
$ 123,407 
$ 107,962 
Adjustments to reconcile consolidated net income to net cash flows from operating activities:
 
 
 
Depreciation and amortization
54,886 
45,693 
43,096 
Deferred income taxes
3,028 
(1,133)
6,316 
Stock-based compensation expense
17,624 
15,043 
18,905 
Provision for bad debt
526 
825 
1,016 
Equity in net income of unconsolidated entities
(39)
(1,428)
(2,027)
Excess tax benefits from stock-option exercises and vesting of restricted stock units
(4,449)
(5,898)
(7,210)
Gain on sale of discontinued operations, Net of Tax
(5,188)
Loss on sale of cost-method investment
(353)
2,034 
Holding gain upon acquisition of additional ownership of equity method investment
(5,168)
(3,635)
Other, net
(715)
(1,830)
142 
Changes in operating assets and liabilities, net of effects of acquisitions:
 
 
 
Accounts receivable
(25,916)
(1,593)
(17,124)
Other assets
(5,336)
(2,302)
223 
Accounts payable and accrued liabilities
(1,960)
(1,244)
1,173 
Accrued compensation
19,484 
3,153 
(8,861)
Income taxes—current
2,274 
16,794 
(1,205)
Deferred revenue
(1,690)
3,658 
7,769 
Deferred rent
3,027 
(1,484)
407 
Other liabilities
(1,261)
(1,368)
(1,432)
Cash provided by operating activities
132,221 
186,658 
145,996 
Investing activities
 
 
 
Purchases of investments
(20,353)
(140,051)
(145,491)
Proceeds from maturities and sales of investments
111,551 
171,243 
260,317 
Capital expenditures
(58,320)
(33,583)
(30,039)
Acquisitions, net of cash acquired
(64,447)
(11,079)
Proceeds from sale of a business, net
957 
5,734 
Purchases of cost and equity method investments
(2,751)
(10,304)
Other, net
353 
403 
(25)
Cash used for investing activities
(31,216)
(14,861)
80,192 
Financing activities
 
 
 
Common shares repurchased
(76,732)
(153,514)
(251,813)
Dividends paid
(30,498)
(17,425)
(25,487)
Proceeds from Short-term Debt
30,000 
Proceeds from stock-option exercises, net
6,606 
4,532 
9,101 
Taxes Withheld For Restricted Stock Units
(5,801)
(5,807)
(4,292)
Excess tax benefits from stock-option exercises and vesting of restricted stock units
4,449 
5,898 
7,210 
Other, net
297 
(56)
105 
Cash provided by (used for) financing activities
(71,679)
(166,372)
(265,176)
Effect of exchange rate changes on cash and cash equivalents
(12,336)
(1,154)
2,440 
Net increase (decrease) in cash and cash equivalents
16,990 
4,271 
(36,548)
Cash and cash equivalents - beginning of period
168,160 
163,889 
200,437 
Cash and cash equivalents - end of period
185,150 
168,160 
163,889 
Supplemental disclosure of cash flow information:
 
 
 
Cash paid for income taxes
30,392 
40,364 
47,355 
Supplemental information of non-cash investing and financing activities:
 
 
 
Unrealized gain (loss) on available-for-sale investments
(362)
(328)
1,723 
Equipment obtained under long-term financing arrangement
$ 0 
$ 4,860 
$ 4,551 
Description of Business
Description of Business
Description of Business
 
Morningstar, Inc. and its subsidiaries (Morningstar, we, our), provides independent investment research for investors around the world. We offer an extensive line of products and services for financial advisors, asset managers, retirement plan providers and sponsors, and individual investors. We have operations in 27 countries.
Correction (Notes)
Corrections
Correction

In 2014, we identified and corrected an immaterial classification error related to the current and long-term balance for deferred rent included on our Consolidated Balance Sheets as of December 31, 2013. The correcting entries had the effect of decreasing accounts payable and accrued liabilities by $10.7 million and increasing deferred rent (long-term) by the same amount. The financial statements have been corrected to reduce the current balance and increase the long-term balance as shown in the table below:

 
 
As of December 31, 2013
($000)
 
Previously Reported

 
Correction

 
As Corrected

Accounts payable and accrued liabilities
 
$
52,877

 
$
(10,746
)
 
$
42,131

Deferred rent
 
$
13,192

 
$
10,746

 
$
23,938

Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies

The acronyms that appear in these Notes to our Consolidated Financial Statements refer to the following:
ASC
Accounting Standards Codification
ASU
Accounting Standards Update
EITF
Emerging Issues Task Force
FASB
Financial Accounting Standards Board
SEC
Securities and Exchange Commission

Principles of Consolidation. We conduct our business operations through wholly owned or majority-owned operating subsidiaries. The accompanying consolidated financial statements include the accounts of Morningstar, Inc. and our subsidiaries. We consolidate assets, liabilities, and results of operations of subsidiaries in which we have a controlling interest and eliminate all significant intercompany accounts and transactions.

We account and report the noncontrolling (minority) interest in our Consolidated Financial Statements in accordance with FASB ASC 810, Consolidation. A noncontrolling interest is the portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to the parent company. We report the noncontrolling interest in our Consolidated Balance Sheet within equity separate from the shareholders' equity attributable to Morningstar, Inc. In addition, we present the net income (loss) and comprehensive income (loss) attributable to Morningstar, Inc.'s shareholders and the noncontrolling interest in our Consolidated Statements of Income, Consolidated Statements of Comprehensive Income, and Consolidated Statements of Equity.

We account for investments in entities in which we exercise significant influence, but do not control, using the equity method.

As part of our investment management operations, we manage certain funds outside of the United States that are considered variable interest entities. For the majority of these variable interest entities, we do not have a variable interest in them. In cases where we do have a variable interest, we are not the primary beneficiary. Accordingly, we do not consolidate any of these variable interest entities.

Comprehensive Income. In accordance with ASU No. 2011-05, Presentation of Comprehensive Income, we present the total of comprehensive income, the components of net income, and the components of other comprehensive income (OCI) in two separate but consecutive statements, our Consolidated Statements of Income and separately, our Consolidated Statements of Comprehensive Income. In addition, effective January 1, 2013, we adopted FASB ASU No. 2013-2, Comprehensive Income (Topic 220). We show the effects of items reclassified out of each component of accumulated other comprehensive income to net income on the face of the financial statement along with net income.

Use of Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses during the reporting period. Actual results may differ from these estimates.

Reclassifications. Certain amounts reported in 2012 have been reclassified to conform to the 2013 presentation.

Separately, as a result of our move to a more centralized structure in 2013 (including new positions created, changes in focus for some existing roles, and the refinement of employee cost categorizations as we moved to a more centralized structure), approximately 180 net positions shifted from the general and administrative and sales and marketing categories to cost of revenue. These changes added approximately $14 million of compensation expense to cost of revenue in 2014 versus 2013 as well as in 2013 versus 2012, and reduced the compensation expense included in the sales and marketing and general and administrative categories by approximately $8 million and $6 million in each of these periods, respectively. These changes did not affect total operating expense or operating income for any of the periods presented.

Cash and Cash Equivalents. Cash and cash equivalents consists of cash and investments with original maturities of three months or less. We state them at cost, which approximates fair value. We state the portion of our cash equivalents that are invested in money market funds at fair value, as these funds are actively traded and have quoted market prices.

Investments. We account for our investments in accordance with FASB ASC 320, Investments—Debt and Equity Securities. We classify our investments into three categories: held-to-maturity, trading, and available-for-sale.

Held-to-maturity: We classify certain investments, primarily certificates of deposit, as held-to-maturity securities, based on our intent and ability to hold these securities to maturity. We record held-to-maturity investments at amortized cost in our Consolidated Balance Sheets.

Trading: We classify certain other investments, primarily equity securities, as trading securities, primarily to satisfy the requirements of one of our wholly owned subsidiaries, which is a registered broker-dealer. We include realized and unrealized gains and losses associated with these investments as a component of our operating income in our Consolidated Statements of Income. We record these securities at their fair value in our Consolidated Balance Sheets.

Available-for-sale: Investments not considered held-to-maturity or trading securities are classified as available-for-sale securities. Available-for-sale securities primarily consist of fixed-income securities. We report unrealized gains and losses for available-for-sale securities as other comprehensive income (loss), net of related income taxes. We record these securities at their fair value in our Consolidated Balance Sheets.

Fair Value Measurements. We follow FASB ASC 820, Fair Value Measurements. FASB ASC 820 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Under FASB ASC 820, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The standard applies whenever other standards require (or permit) assets or liabilities to be measured at fair value. The standard does not expand the use of fair value in any new circumstances and does not require any new fair value measurements.

Effective January 1, 2012, we adopted FASB ASU No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in GAAP and IFRS. ASU No. 2011-04 clarifies existing fair value measurement and disclosure requirements, amends certain fair value measurement principles, and requires additional disclosures about fair value measurements. The adoption of ASU No. 2011-04 did not have a material impact on our Consolidated Financial Statements.

FASB ASC 820 uses a fair value hierarchy based on three broad levels of valuation inputs:

Level 1: Valuations based on quoted prices in active markets for identical assets or liabilities that the company has the ability to access.

Level 2: Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3: Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

We provide additional information about our cash equivalents and investments that are subject to valuation under FASB ASC 820 in Note 7.

Concentration of Credit Risk. No single customer is large enough to pose a significant credit risk to our operations or financial condition. For the years ended December 31, 2014, 2013, and 2012, no single customer represented 5% or more of our consolidated revenue. If receivables from our customers become delinquent, we begin a collections process. We maintain an allowance for doubtful accounts based on our estimate of the probable losses of accounts receivable.

Property, Equipment, and Depreciation. We state property and equipment at historical cost, net of accumulated depreciation. We depreciate property and equipment primarily using the straight-line method based on the useful life of the asset, which ranges from three to seven years. We amortize leasehold improvements over the lease term or their useful lives, whichever is shorter.

Computer Software and Internal Product Development Costs. We capitalize certain costs in accordance with FASB ASC 350-40, Internal-Use Software, FASB ASC 350-50, Website Development Costs, and FASB ASC 985, Software. Internal product development costs mainly consist of employee costs for developing new web-based products and certain major enhancements of existing products. We amortize these costs on a straight-line basis over the estimated economic life, which is generally three to five years. We include capitalized software development costs related to projects that have not been placed into service in our construction in progress balance.

The table below summarizes our capitalized software development costs for the past three years:
($000)
 
2014

 
2013

 
2012

Capitalized software development costs
 
$
18,804

 
$
8,142

 
$
8,527



Business Combinations. Over the past several years, we have acquired companies that complement our business operations. For each acquisition, we allocate the purchase price to the assets acquired, liabilities assumed, and goodwill. We follow FASB ASC 805, Business Combinations. We recognize and measure the fair value of the acquired operation as a whole, as well as the assets acquired and liabilities assumed, at their full fair values as of the date we obtain control, regardless of the percentage ownership in the acquired operation or how the acquisition was achieved. We expense direct costs related to the business combination, such as advisory, accounting, legal, valuation, and other professional fees, as incurred. We recognize restructuring costs, including severance and relocation for employees of the acquired entity, as post-combination expenses unless the target entity meets the criteria of FASB ASC 420, Exit or Disposal Cost Obligations, on the acquisition date.

As part of the purchase price allocation, we follow the requirements of FASB ASC 740, Income Taxes. This includes establishing deferred tax assets or liabilities reflecting the difference between the values assigned for financial statement purposes and income tax purposes. In certain acquisitions, the goodwill resulting from the purchase price allocation may not be deductible for income tax purposes. FASB ASC 740 prohibits recognition of a deferred tax asset or liability for temporary differences in goodwill if goodwill is not amortizable and deductible for tax purposes.

Goodwill. Changes in the carrying amount of our recorded goodwill are mainly the result of business acquisitions, divestitures, and the effect of foreign currency translations. In accordance with FASB ASC 350, Intangibles—Goodwill and Other, we do not amortize goodwill; instead, goodwill is subject to an impairment test annually, or whenever indicators of impairment exist. An impairment would occur if the carrying amount of a reporting unit exceeded the fair value of that reporting unit. We performed annual impairment reviews in the fourth quarter of 2014, 2013, and 2012. We did not record any significant impairment losses in 2014, 2013, and 2012.

Intangible Assets. We amortize intangible assets using the straight-line method over their estimated useful lives, which range from one to 25 years. We have no intangible assets with indefinite useful lives. In accordance with FASB ASC 360-10-35, Subsequent Measurement—Impairment or Disposal of Long Lived Assets, we review intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If the value of future undiscounted cash flows is less than the carrying amount of an asset group, we record an impairment loss based on the excess of the carrying amount over the fair value of the asset group. We did not record any impairment losses in 2014, 2013, or 2012.

Revenue Recognition. We recognize revenue in accordance with SEC SAB Topic 13, Revenue Recognition, ASC 605-25, Revenue Recognition: Multiple Element Arrangements, and ASC 985-605, Software: Revenue Recognition.

We recognize revenue when all of the following conditions are met:

There is persuasive evidence of an arrangement, as evidenced by a signed contract;
Delivery of our products and services has taken place. If arrangements include an acceptance provision, we generally begin recognizing revenue when we receive customer acceptance;
The amount of fees to be paid by the customer is fixed or determinable; and
The collectibility of the fees is reasonably assured.

We generate revenue through sales of Morningstar Data, Morningstar Advisor Workstation (including Morningstar Office), Morningstar Direct, Morningstar Research, Premium Membership subscriptions for Morningstar.com, our structured credit research and ratings offerings, and a variety of other investment-related products and services. We generally structure the revenue agreements for these offerings as licenses or subscriptions. We recognize revenue from licenses and subscription sales ratably as we deliver the product or service and over the service obligation period defined by the terms of the customer contract. For new-issue ratings and analysis for commercial mortgage- backed securities (CMBS), we charge asset-based fees that are paid by the issuer on the rated balance of the transaction and recognize the revenue immediately upon issuance.

We also generate revenue from Internet advertising, primarily from “impression-based” contracts. For advertisers who use our cost-per-impression pricing, we charge fees each time we display their ads on our site.

Our Investment Advisory business includes a broad range of services. Pricing for consulting services is based on the scope of work and the level of service provided, and includes asset-based fees for work we perform that involves investment management or acting as a subadvisor to investment portfolios. In arrangements that involve asset-based fees, we generally invoice clients quarterly in arrears based on average assets for the quarter. We recognize asset-based fees once the fees are fixed and determinable assuming all other revenue recognition criteria are met.

Our Retirement Solutions offerings help retirement plan participants plan and invest for retirement. We offer these services both through retirement plan providers (typically third-party asset management companies that offer proprietary mutual funds) and directly to plan sponsors (employers that offer retirement plans to their employees). For our Retirement Solutions offerings, we provide both a hosted solution as well as proprietary installed software advice solution. Clients can integrate the installed customized software into their existing systems to help investors accumulate wealth, transition into retirement, and manage income during retirement. The revenue arrangements for Retirement Solutions generally extend over multiple years. Our contracts may include one-time setup fees, implementation fees, technology licensing and maintenance fees, asset-based fees for managed retirement accounts, fixed and variable fees for advice and guidance, or a combination of these fee structures. Upon customer acceptance, we recognize revenue ratably over the term of the agreement. We recognize asset-based fees and variable fees in excess of any minimum once the value is fixed and determinable.

Some of our revenue arrangements combine multiple products and services. These products and services may be provided at different points in time or over different time periods within the same arrangement. We allocate fees to the separate deliverables based on the deliverables’ relative selling price, which is generally based on the price we charge when the same deliverable is sold separately.

We record taxes imposed on revenue-producing transactions (such as sales, use, value-added, and some excise taxes) on a net basis; therefore, we exclude such taxes from revenue in our Consolidated Statements of Income.

Deferred revenue represents the portion of licenses or subscriptions billed or collected in advance of the service being provided, which we expect to recognize as revenue in future periods. Certain arrangements may have cancellation or refund provisions. If we make a refund, it typically reflects the amount collected from a customer for which we have not yet provided services. The refund therefore results in a reduction of deferred revenue.

Advertising Costs. Advertising costs include expenses incurred for various print and Internet ads, search engine fees, and direct mail campaigns. We expense advertising costs as incurred. The table below summarizes our advertising expense for the past three years:
($000)
 
2014

 
2013

 
2012

Advertising expense
 
$
7,497

 
$
6,939

 
$
6,306



Stock-Based Compensation Expense. We account for our stock-based compensation expense in accordance with FASB ASC 718, Compensation—Stock Compensation. Our stock-based compensation expense reflects grants of restricted stock units, restricted stock, performance share awards, and stock options. We measure the fair value of our restricted stock units, restricted stock, and performance share awards on the date of grant based on the closing market price of Morningstar's common stock on the day prior to grant. For stock options, we estimate the fair value of our stock options on the date of grant using a Black-Scholes option-pricing model. We amortize the fair values to stock-based compensation expense, net of estimated forfeitures, ratably over the vesting period.

We estimate expected forfeitures of all employee stock-based awards and recognize compensation cost only for those awards expected to vest. We determine forfeiture rates based on historical experience and adjust the estimated forfeitures to actual forfeiture experience as needed.

Liability for Sabbatical Leave. In certain of our operations, we offer employees a sabbatical leave. Although the sabbatical policy varies by region, Morningstar's full-time employees are generally eligible for six weeks of paid time off after four years of continuous service. We account for our sabbatical liability in accordance with FASB ASC 710-10-25, Compensated Absences. We record a liability for employees' sabbatical benefits over the period employees earn the right for sabbatical leave and include this liability in Accrued Compensation in our Consolidated Balance Sheet.

Income Taxes. We record deferred income taxes for the temporary differences between the carrying amount of assets and liabilities for financial statement purposes and tax purposes in accordance with FASB ASC 740, Income Taxes. FASB ASC 740 prescribes the minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, and disclosure for uncertain tax positions.

We recognize interest and penalties related to unrecognized tax benefits as part of income tax expense in our Consolidated Statements of Income. We classify liabilities related to unrecognized tax benefits as either current or long-term liabilities in our Consolidated Balance Sheet, depending on when we expect to make payment.

Income per Share. We compute and present income per share in accordance with FASB ASC 260, Earnings Per Share. The difference between weighted average shares outstanding and diluted shares outstanding mainly reflects the dilutive effect associated with our stock-based compensation plans. We further compute income per share in accordance with FASB ASC 260-10-45-59A, Participating Securities and the Two Class Method. Under the two-class method, we allocate earnings between common stock and participating securities. The two-class method includes an earnings allocation formula that determines earnings per share for each class of common stock according to dividends declared and undistributed earnings for the period. For purposes of calculating earnings per share, we reduce our reported net earnings by the amount allocated to participating securities to arrive at the earnings allocated to common stock shareholders.

ASC 260-10-45-59A requires the dilutive effect of participating securities to be calculated using the more dilutive of the treasury stock or the two-class method. We have determined the two-class method to be the more dilutive. As such, we adjusted the earnings allocated to common stock shareholders in the basic earnings per share calculation for the reallocation of undistributed earnings to participating securities to calculate diluted earnings per share.

Foreign Currency. We translate the financial statements of non-U.S. subsidiaries to U.S. dollars using the period-end exchange rate for assets and liabilities and an average exchange rate for revenue and expense. We use the local currency as the functional currency for all of our non-U.S. subsidiaries. We record translation adjustments for non-U.S. subsidiaries as a component of “Other comprehensive income (loss)” in our Consolidated Statements of Comprehensive Income. We include exchange gains and losses arising from transactions denominated in currencies other than the functional currency in “Other income (expense), net” in our Consolidated Statements of Income.

Credit Arrangements (Notes)
Credit Arrangements
Credit Arrangements

In July 2014, we entered into a one year, $75.0 million, single-bank revolving credit facility. We drew on the credit facility during 2014 and had an outstanding principal balance of $30.0 million at an interest rate of LIBOR plus 100 basis points as of December 31, 2014, leaving borrowing availability of $45.0 million.
Income Per Share
Income Per Share
Income Per Share
 
The following table shows how we reconcile our net income and the number of shares used in computing basic and diluted income per share:

(in thousands, except per share amounts)
 
2014

 
2013

 
2012

 
 
 
 
 
 
 
Basic net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Net income attributable to Morningstar, Inc.:
 
$
78,301

 
$
123,529

 
$
108,079

Less: Distributed earnings available to participating securities
 
(7
)
 
(10
)
 
(41
)
Less: Undistributed earnings available to participating securities
 
(9
)
 
(36
)
 
(47
)
Numerator for basic net income per share — undistributed and distributed earnings available to common shareholders
 
$
78,285

 
$
123,483

 
$
107,991

 
 
 
 
 
 
 
Weighted average common shares outstanding
 
44,675

 
46,158

 
48,497

 
 
 
 
 
 
 
Basic net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Continuing operations
 
$
1.75

 
$
2.68

 
$
2.12

Discontinued operations
 

 

 
0.11

Total
 
$
1.75

 
$
2.68

 
$
2.23

 
 
 
 
 
 
 
Diluted net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Numerator for basic net income per share — undistributed and distributed earnings available to common shareholders
 
$
78,285

 
$
123,483

 
$
107,991

Add: Undistributed earnings allocated to participating securities
 
9

 
36

 
47

Less: Undistributed earnings reallocated to participating securities
 
(9
)
 
(36
)
 
(46
)
Numerator for diluted net income per share — undistributed and distributed earnings available to common shareholders
 
$
78,285

 
$
123,483

 
$
107,992

 
 


 


 
 
Weighted average common shares outstanding
 
44,675

 
46,158

 
48,497

Net effect of dilutive stock options and restricted stock units
 
226

 
333

 
651

Weighted average common shares outstanding for computing diluted income per share
 
44,901

 
46,491

 
49,148

 
 


 


 
 
Diluted net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Continuing operations
 
$
1.74

 
$
2.66

 
$
2.10

Discontinued operations
 

 

 
0.10

Total
 
$
1.74

 
$
2.66

 
$
2.20


The following table shows the number of weighted average stock options, restricted stock units, and performance share awards excluded from our calculation of diluted earnings per share from both continuing operations and net earnings because their inclusion would have been anti-dilutive:
(in thousands)
 
2014

 
2013

 
2012

Weighted average stock options
 

 

 
83

Weighted average restricted stock units
 
47

 
17

 
7

Weighted average performance share awards
 
6

 

 

Total
 
53

 
17

 
90


Stock options and restricted stock could be included in the calculation in the future.
Segment and Geographical Area Information
Segment and Geographical Area Information
Segment, Enterprise-Wide, and Geographical Area Information

Segment Information

We report our results in a single reportable segment, which reflects how our chief operating decision maker allocates resources and evaluates our financial results.

Because we have a single reportable segment, all required financial segment information can be found directly in the Consolidated Financial Statements.

The accounting policies for our reportable segment are the same as those described in Note 3. We evaluate the performance of our reporting segment based on revenue and operating income.

Products and Services Information

We derive revenue from two product groups. The investment information product group includes all of our data, software, and research products and services. These products are typically sold through subscriptions or license agreements. The investment management product group includes all of our asset management operations, which earn the majority of their revenue from asset-based fees. The table below summarizes our revenue by product group:
 
External revenue by product group
 
 
 
 
 
 
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Investment information
 
$
597,046

 
$
555,642

 
$
526,147

Investment management
 
163,025

 
142,624

 
132,141

Consolidated revenue
 
$
760,071

 
$
698,266

 
$
658,288


Geographical Area Information

The tables below summarize our revenue and long-lived assets by geographical area:

External revenue by geographical area
 
 
 
 
 
 
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

United States
 
$
550,740

 
$
500,730

 
$
466,947

 
 
 
 
 
 
 
United Kingdom
 
61,844

 
56,298

 
56,794

Continental Europe
 
62,677

 
57,580

 
49,844

Australia
 
34,977

 
35,289

 
38,229

Canada
 
30,790

 
31,845

 
30,664

Asia
 
15,830

 
13,860

 
13,765

Other
 
3,213

 
2,664

 
2,045

Total International
 
209,331

 
197,536

 
191,341

 
 
 
 
 
 
 
Consolidated revenue
 
$
760,071

 
$
698,266

 
$
658,288


Long-lived assets by geographical area
 
 
 
 
 
 
As of December 31
($000)
 
2014

 
2013

United States
 
$
98,135

 
$
84,321

 
 
 
 
 
United Kingdom
 
8,014

 
6,873

Continental Europe
 
2,102

 
1,873

Australia
 
794

 
1,051

Canada
 
938

 
1,275

Asia
 
7,491

 
9,479

Other
 
87

 
114

Total International
 
19,426

 
20,665

 
 
 
 
 
Consolidated property, equipment, and capitalized software, net
 
$
117,561

 
$
104,986

Investments and Fair Value Measurements
Investments and Fair Value Measurements
Investments and Fair Value Measurements
 
We account for our investments in accordance with FASB ASC 320, Investments—Debt and Equity Securities. We classify our investments into three categories: available-for-sale, held-to-maturity, and trading. Our investment portfolio is primarily invested in proprietary Morningstar portfolios, exchange-traded funds that seek to track the performance of certain Morningstar proprietary indexes, and various mutual funds. We classify our investment portfolio as shown below:
 
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Available-for-sale
 
$
13,187

 
$
91,461

Held-to-maturity
 
17,930

 
31,214

Trading securities
 
8,305

 
7,732

Total
 
$
39,422

 
$
130,407


 
The following table shows the cost, unrealized gains (losses), and fair values related to investments classified as available-for-sale and held-to-maturity:
 
 
 
As of December 31, 2014
 
As of December 31, 2013
($000)
 
Cost

 
Unrealized
Gain

 
Unrealized
Loss

 
Fair
Value

 
Cost

 
Unrealized
Gain

 
Unrealized
Loss

 
Fair
Value

Available-for-sale:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Government obligations
 
$

 
$

 
$

 
$

 
$
19,693

 
$
8

 
$
(3
)
 
$
19,698

Corporate bonds
 

 

 

 

 
49,913

 
22

 
(124
)
 
49,811

Foreign obligations
 

 

 

 

 
505

 

 
(2
)
 
503

Commercial paper
 

 

 

 

 
9,482

 
7

 

 
9,489

Equity securities and exchange-traded funds
 
11,428

 
796

 
(289
)
 
11,935

 
8,872

 
1,011

 
(141
)
 
9,742

Mutual funds
 
1,220

 
132

 
(100
)
 
1,252

 
2,095

 
221

 
(98
)
 
2,218

Total
 
$
12,648

 
$
928

 
$
(389
)
 
$
13,187

 
$
90,560

 
$
1,269

 
$
(368
)
 
$
91,461

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Held-to-maturity:
 
 
 
 
 
 
 
 
 
 

 
 

 
 

 
 

Certificates of deposit
 
$
17,930

 
$

 
$

 
$
17,930

 
$
31,214

 
$

 
$

 
$
31,214


 
As of December 31, 2014 and December 31, 2013, investments with unrealized losses for greater than a 12-month period were not material to the Consolidated Balance Sheets and were not deemed to have other than temporary declines in value.

The table below shows the cost and fair value of investments classified as available-for-sale and held-to-maturity based on their contractual maturities as of December 31, 2014 and December 31, 2013. The expected maturities of certain fixed-income securities may differ from their contractual maturities because some of these holdings have call features that allow the issuers the right to prepay obligations without penalties.
 
 
 
As of December 31, 2014
 
As of December 31, 2013
($000)
 
Cost

 
Fair Value

 
Cost

 
Fair Value

Available-for-sale:
 
 

 
 

 
 

 
 

Due in one year or less
 
$

 
$

 
$
45,486

 
$
45,402

Due in one to two years
 

 

 
34,107

 
34,099

Equity securities, exchange-traded funds, and mutual funds
 
12,648

 
13,187

 
10,967

 
11,960

Total
 
$
12,648

 
$
13,187

 
$
90,560

 
$
91,461

 
 
 
 
 
 
 
 
 
Held-to-maturity:
 
 

 
 

 
 

 
 

Due in one year or less
 
$
17,929

 
$
17,929

 
$
31,210

 
$
31,210

Due in one to three years
 
1

 
1

 
4

 
4

Total
 
$
17,930

 
$
17,930

 
$
31,214

 
$
31,214


 
As of December 31, 2014 and December 31, 2013, held-to-maturity investments included a $1.5 million certificate of deposit, held primarily as collateral against bank guarantees for our office leases, primarily in Australia.

The following table shows the realized gains and losses arising from sales of our investments classified as available-for-sale recorded in our Consolidated Statements of Income: 
($000)
 
2014

 
2013

 
2012

Realized gains
 
$
1,484

 
$
5,550

 
$
1,671

Realized losses
 
(466
)
 
(1,343
)
 
(1,133
)
Realized gains, net
 
$
1,018

 
$
4,207

 
$
538


 
We determine realized gains and losses using the specific identification method.

The following table shows the net unrealized gains (losses) on trading securities as recorded in our Consolidated Statements of Income:
 
($000)
 
2014

 
2013

 
2012

Unrealized gains (losses), net
 
$
(188
)
 
$
827

 
$
269



The table below shows the fair value of our assets subject to fair value measurements that are measured at fair value on a recurring basis using the fair value hierarchy and the necessary disclosures under FASB ASC 820, Fair Value Measurement:

 
 
 
Fair Value
 
Fair Value Measurements as of December 31, 2014
 
 
as of
 
Using Fair Value Hierarchy
($000)
 
December 31, 2014
 
Level 1

 
Level 2

 
Level 3

Available-for-sale investments
 
 

 
 

 
 

 
 

Government obligations
 
$

 
$

 
$

 
$

Corporate bonds
 

 

 

 

Foreign obligations
 

 

 

 

Commercial paper
 

 

 

 

Equity securities and exchange-traded funds
 
11,935

 
11,935

 

 

Mutual funds
 
1,252

 
1,252

 

 

Trading securities
 
8,305

 
8,305

 

 

Cash equivalents
 
512

 
512

 

 

Total
 
$
22,004

 
$
22,004

 
$

 
$

 
 
 
Fair Value
 
Fair Value Measurements as of December 31, 2013
 
 
as of
 
Using Fair Value Hierarchy
($000)
 
December 31, 2013
 
Level 1

 
Level 2

 
Level 3

Available-for-sale investments
 
 

 
 

 
 

 
 

Government obligations
 
$
19,698

 
$

 
$
19,698

 
$

Corporate bonds
 
49,811

 

 
49,811

 

Foreign obligations
 
503

 

 
503

 

Commercial paper
 
9,489

 

 
9,489

 

Equity securities and exchange-traded funds
 
9,742

 
9,742

 

 

Mutual funds
 
2,218

 
2,218

 

 

Trading securities
 
7,732

 
7,732

 

 

Cash equivalents
 
925

 
925

 

 

Total
 
$
100,118

 
$
20,617

 
$
79,501

 
$


 

Level 1:
Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access.
Level 2:
Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.
Level 3:
Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

Based on our analysis of the nature and risks of our investments in equity securities and mutual funds, we have determined that presenting each of these investment categories in the aggregate is appropriate.

There were no transfers between levels one and two during the year ended December 31, 2014.

We measure the fair value of money market funds, mutual funds, equity securities, and exchange-traded funds based on quoted prices in active markets for identical assets or liabilities. All other financial instruments were valued either based on recent trades of securities in inactive markets or based on quoted market prices of similar instruments and other significant inputs derived from observable market data. We did not hold any securities categorized as Level 3 as of December 31, 2014 and December 31, 2013.
Acquisitions, Goodwill, and Other Intangible Assets
Acquisitions, Goodwill, and Other Intangible Assets
Acquisitions, Goodwill, and Other Intangible Assets
 
2014 Acquisitions

Increased Ownership Interest in HelloWallet Holdings, Inc.

In June 2014, we acquired an additional 81.3% interest in HelloWallet Holdings, Inc. (HelloWallet), increasing our ownership to 100% from 18.7%. HelloWallet combines behavioral economics and the psychology of decision-making with sophisticated technology to provide personalized, unbiased financial guidance to U.S. workers and their families through their employer benefit plans. We began consolidating the financial results of this acquisition in our Consolidated Financial Statements on June 3, 2014.

HelloWallet's total preliminary estimated fair value of $54,006,000 includes $40,525,000 in cash paid to acquire the remaining 81.3% interest in HelloWallet and pay off HelloWallet's indebtedness as well as $13,481,000 related to the 18.7% of HelloWallet we previously held. We recorded a preliminary non-cash holding gain of $5,168,000 for the difference between the fair value and the book value of our previously held investment. The gain is classified as "Holding gain upon acquisition of additional ownership of equity-method investments" in our Consolidated Statement of Income for the year ended December 31, 2014.

The purchase price valuation will be finalized upon the completion of the fair value analysis of the acquired assets and liabilities. We have not yet obtained all of the information related to the fair value of the acquired assets and liabilities to finalize the purchase price allocation. The primary area that is not yet finalized relates to income taxes.

The following table summarizes our preliminary allocation of the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition, all of which are preliminary pending completion of the final valuation:
 
 
($000)

Cash and cash equivalents
 
$
3,739

Accounts receivable and other current assets
 
150

Other current and non-current assets
 
318

Deferred tax asset
 
8,646

Intangible assets
 
9,460

Goodwill
 
39,166

Deferred revenue
 
(2,897
)
Deferred tax liability
 
(3,595
)
Other current and non-current liabilities
 
(981
)
Total fair value of HelloWallet
 
$
54,006



The preliminary allocation includes $9,460,000 of acquired intangible assets, as follows:
 
 
($000)

 
Weighted Average Useful Life (years)
Technology based assets
 
6,670

 
5
Intellectual property (trademarks and trade names)
 
169

 
3
Non-competition agreement
 
2,621

 
5
Total intangible assets
 
$
9,460

 
5


We recognized a preliminary deferred tax liability of $3,595,000 mainly because the amortization expense related to certain intangible assets is not deductible for income tax purposes. The fair value of the acquired intangible assets and the deferred tax liability are preliminary pending receipt of the final valuation for these assets.

We recognized a preliminary deferred tax asset of $8,646,000 mainly because of net operating losses of HelloWallet which will become available to Morningstar.

Preliminary goodwill of $39,166,000 represents the premium over the fair value of the net tangible and intangible assets acquired. We paid this premium for a number of reasons, including the opportunity to bring together HelloWallet's comprehensive financial wellness expertise with Morningstar's independent, research-based retirement advice to create a holistic retirement savings and advice offering.

ByAllAccounts, Inc.

In April 2014, we acquired ByAllAccounts, Inc. (ByAllAccounts), a provider of innovative data aggregation technology for financial applications for $27,949,000 in cash. ByAllAccounts uses a knowledge-based process, including patented artificial intelligence technology, to collect, consolidate, and enrich financial account data and deliver it to virtually any platform. We began including the financial results of this acquisition in our Consolidated Financial Statements on April 1, 2014.

The purchase price valuation will be finalized upon the completion of the fair value analysis of the acquired assets and liabilities. We have not yet obtained all of the information related to the fair value of the acquired assets and liabilities to finalize the purchase price allocation. The primary area that is not yet finalized relates to income taxes.

The following table summarizes our preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition, all of which are preliminary pending completion of the final valuation:
 
 
($000)

Cash and cash equivalents
 
$
287

Accounts receivable and other current assets
 
152

Deferred tax asset
 
3,987

Other current and non-current assets
 
257

Intangible assets
 
8,681

Goodwill
 
18,476

Deferred revenue
 
(79
)
Deferred tax liability
 
(3,299
)
Other current and non-current liabilities
 
(513
)
Total purchase price
 
$
27,949



The preliminary allocation includes $8,681,000 of acquired intangible assets, as follows:

 
 
($000)

 
Weighted Average Useful Life (years)
Customer-related assets
 
$
5,506

 
24
Technology-based assets
 
3,020

 
4.5
Intellectual property (trademarks and trade names)
 
47

 
1
Non-competition agreement
 
108

 
3
Total intangible assets
 
$
8,681

 
19


We recognized a preliminary deferred tax liability of $3,299,000 mainly because the amortization expense related to certain intangible assets is not deductible for income tax purposes. The fair value of the acquired intangible assets and the deferred tax liability are preliminary pending receipt of the final valuation for these intangible assets.

We recognized a preliminary deferred tax asset of $3,987,000 mainly because of net operating losses of ByAllAccounts which will become available to Morningstar.

Preliminary goodwill value of $18,476,000 represents the premium we paid over the fair value of the acquired net tangible and intangible assets. We paid this premium for a number of reasons, including the opportunity to integrate the service into our offerings as well as expand and develop ByAllAccounts' third-party distribution relationships.

2013 Acquisitions

Increased Ownership Interest in Morningstar Sweden AB

In May 2013, we acquired an additional 76% interest in Morningstar Sweden AB (Morningstar Sweden), increasing our ownership to 100% from 24%. Morningstar’s main offerings in Sweden include Morningstar Direct, Morningstar Data, Morningstar Enterprise Components (formerly Integrated Web Tools), and Morningstar.se, a website for individual investors. We began consolidating the financial results of this acquisition in our Consolidated Financial Statements on May 2, 2013.

Morningstar Sweden's total estimated fair value of $18,513,000 included $14,554,000 in cash paid to acquire the remaining 76% interest in Morningstar Sweden and $3,959,000 related to the 24% of Morningstar Sweden we previously held. We determined the fair value of the previously held 24% investment independent of the acquired controlling interest by applying a minority interest discount based on analysis of comparable transactions. Accordingly, we recorded a non-cash holding gain of $3,635,000, which is classified as "Holding gain upon acquisition of additional ownership of equity-method investments" in our Consolidated Statement of Income for the year ended December 31, 2013.

The following table summarizes our allocation of the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition:
 
 
($000)

Cash and cash equivalents
 
$
3,472

Accounts receivable and other current assets
 
519

Other non-current assets
 
244

Intangible assets
 
9,700

Goodwill
 
8,911

Deferred revenue
 
(1,191
)
Deferred tax liability
 
(2,272
)
Other current and non-current liabilities
 
(870
)
Total fair value of Morningstar Sweden
 
$
18,513



The allocation included acquired intangible assets, as follows:
 
 
($000)

 
Weighted Average Useful Life (years)
Customer-related assets
 
$
9,700

 
14
Total intangible assets
 
$
9,700

 
14


We recognized a deferred tax liability of $2,272,000 mainly because the amortization expense related to certain intangible assets is not deductible for income tax purposes.

Goodwill of $8,911,000 represents the premium over the fair value of the net tangible and intangible assets acquired with this acquisition. We paid this premium for a number of reasons, including the opportunity to offer Morningstar's full suite of products and services to investors in Sweden and further leverage Morningstar's global reach, investment databases, and technology expertise.

Goodwill
 
The following table shows the changes in our goodwill balances from January 1, 2013 to December 31, 2014:
 
 
 
($000)

Balance as of January 1, 2013
 
$
320,845

Acquisition of remaining ownership in Morningstar Sweden
 
8,911

Other, primarily foreign currency translation
 
(3,306
)
Balance as of December 31, 2013
 
$
326,450

Acquisition of HelloWallet and ByAllAccounts
 
57,642

Foreign currency translation
 
(14,038
)
Balance as of December 31, 2014
 
$
370,054



We did not record any significant impairment losses in 2014, 2013, or 2012, as the estimated fair values of our reporting units exceeded their carrying values. We perform our annual impairment testing during the fourth quarter of each year.

Intangible Assets

The following table summarizes our intangible assets: 
 
 
As of December 31, 2014
 
As of December 31, 2013
($000)
 
Gross

 
Accumulated
Amortization

 
Net

 
Weighted
Average
Useful  Life
(years)
 
Gross

 
Accumulated
Amortization

 
Net

 
Weighted
Average
Useful  Life
(years)
Intellectual property
 
$
29,026

 
$
(25,033
)
 
$
3,993

 
9
 
$
29,477

 
$
(23,128
)
 
$
6,349

 
9
Customer-related assets
 
141,497

 
(83,582
)
 
57,915

 
12
 
141,833

 
(74,311
)
 
67,522

 
12
Supplier relationships
 
240

 
(120
)
 
120

 
20
 
240

 
(108
)
 
132

 
20
Technology-based assets
 
88,816

 
(57,395
)
 
31,421

 
8
 
80,489

 
(50,673
)
 
29,816

 
9
Non-competition agreement
 
4,339

 
(1,883
)
 
2,456

 
5
 
1,661

 
(1,571
)
 
90

 
4
Total intangible assets
 
$
263,918

 
$
(168,013
)
 
$
95,905

 
10
 
$
253,700

 
$
(149,791
)
 
$
103,909

 
10

 
The following table summarizes our amortization expense related to intangible assets:
($000)
 
2014

 
2013

 
2012

Amortization expense
 
$
22,264

 
$
21,454

 
$
23,944


 
We did not record any significant impairment losses involving intangible assets in 2014, 2013, or 2012.

We amortize intangible assets using the straight-line method over their expected economic useful lives.

Based on acquisitions and divestitures completed through December 31, 2014, we expect intangible amortization expense for 2015 and subsequent years to be as follows:
 
 
($000)

2015
 
$
21,920

2016
 
17,394

2017
 
12,941

2018
 
10,790

2019
 
8,046

Thereafter
 
24,814


 
Our estimates of future amortization expense for intangible assets may be affected by additional acquisitions, divestitures, changes in the estimated average useful life, and currency translations.
Discontinued Operations
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
Discontinued Operations

In October 2012, we sold Morningstar Investor Relations Services to UK-based Investis, a leading specialist in digital corporate communications for public companies. In October 2012, we sold the Morningstar Australasia trade publishing assets to Sterling Publishing Pty Ltd. We have not reclassified the operating results of these businesses to discontinued operations, nor have we reclassified the related assets and liabilities to held for disposition, because these amounts are not significant to our consolidated financial statements.

The following table summarizes the amounts included in our Consolidated Statements of Income for discontinued operations for the years ended December 31, 2014, 2013, and 2012:

($000)
 
2014

 
2013

 
2012

Gain on sales of businesses
 
$

 
$

 
$
6,193

Income tax expense
 

 

 
1,005

Earnings from discontinued operations, net of tax
 
$

 
$

 
$
5,188

Investments in Unconsolidated Entities
Investments in Unconsolidated Entities
Investments in Unconsolidated Entities
 
Our investments in unconsolidated entities consist primarily of the following:
 
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Investment in MJKK
 
$
23,014

 
$
21,782

Other equity method investments
 
3,475

 
6,166

Investments accounted for using the cost method
 
2,309

 
10,766

Total investments in unconsolidated entities
 
$
28,798

 
$
38,714


 
Morningstar Japan K.K. Morningstar Japan K.K. (MJKK) develops and markets products and services customized for the Japanese market. MJKK’s shares are traded on the Tokyo Stock Exchange under the ticker 47650. We account for our investment in MJKK using the equity method. The following table summarizes our ownership percentage in MJKK and the market value of this investment based on MJKK’s publicly quoted share price: 
 
 
As of December 31
 
 
 
 
2014

 
2013

Morningstar’s approximate ownership of MJKK
 
34
%
 
34
%
Approximate market value of Morningstar’s ownership in MJKK:
 
 

 
 

Japanese yen (¥000)
 
¥
7,347,413

 
¥
9,824,068

Equivalent U.S. dollars ($000)
 
$
61,277

 
$
94,999



Other Equity Method Investments. As of December 31, 2014 and 2013, other equity method investments consist of our investment in Inquiry Financial Europe AB (Inquiry Financial) and YCharts, Inc. (YCharts). Inquiry Financial is a provider of sell-side consensus estimate data. Our ownership interest in Inquiry Financial was approximately 34% as of December 31, 2014 and 2013. YCharts is a technology company that provides stock research and analysis. Our ownership interest in YCharts was approximately 22% as of December 31, 2014 and 2013.

Cost Method Investments. As of December 31, 2014, our cost method investments consist of a minority investment in Pitchbook Data, Inc. (Pitchbook). Pitchbook offers detailed data and information about private equity transactions, investors, companies, limited partners, and service providers.

As of December 31, 2013, our cost method investments also included a minority investment in HelloWallet LLC (HelloWallet). In June 2014, we purchased the remaining interest in HelloWallet. See Note 8 for additional information concerning our acquisition of HelloWallet.

During 2014, we recorded an impairment loss of $1.7 million on our investment in an unconsolidated entity. We did not record any impairment losses on these investments in 2013.
 
Property, Equipment, and Capitalized Software
Property, Equipment, and Capitalized Software
Property, Equipment, and Capitalized Software

The following table shows our property, equipment, and capitalized software summarized by major category:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Computer equipment
 
$
53,420

 
$
47,830

Capitalized software
 
87,764

 
50,360

Furniture and fixtures
 
23,172

 
23,259

Leasehold improvements
 
54,320

 
52,512

Telephone equipment
 
1,948

 
2,032

Construction in progress
 
29,870

 
35,159

Property, equipment, and capitalized software, at cost
 
250,494

 
211,152

Less accumulated depreciation
 
(132,933
)
 
(106,166
)
Property, equipment, and capitalized software, net
 
$
117,561

 
$
104,986


The following table shows the amount of capitalized software development costs included in construction in progress:
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Capitalized software development costs not yet placed into service
 
$
18,070

 
$
11,345



The following table summarizes our depreciation expense:
($000)
 
2014

 
2013

 
2012

Depreciation expense
 
$
32,622

 
$
24,239

 
$
19,152

Operating Leases
Operating Leases
Operating Leases

The following table shows our minimum future rental commitments due in each of the next five years and thereafter for all non-cancelable operating leases, consisting primarily of leases for office space:
Minimum Future Rental Commitments
 
($000)

2015
 
$
19,395

2016
 
20,299

2017
 
19,270

2018
 
16,916

2019
 
12,632

Thereafter
 
48,203

Total
 
$
136,715


The following table summarizes our rent expense including taxes, insurance, and related operating costs:

($000)
 
2014

 
2013

 
2012

Rent expense
 
$
24,460

 
$
22,169

 
$
20,736



Deferred rent includes build-out and rent abatement allowances received, which are amortized over the remaining portion of the original term of the lease as a reduction in office lease expense. We include deferred rent, as appropriate, in “Accounts payable and accrued liabilities” and “Deferred rent, noncurrent” on our Consolidated Balance Sheets.
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Deferred rent
 
$
29,124

 
$
26,157



Stock-Based Compensation
Stock-Based Compensation
Stock-Based Compensation

Stock-Based Compensation Plans
 
Our shareholders approved the Morningstar 2011 Stock Incentive Plan (the 2011 Plan) on May 17, 2011. As of that date we stopped granting awards under the Morningstar 2004 Stock Incentive Plan (the 2004 Plan). The 2004 Plan amended and restated the Morningstar 1993 Stock Option Plan, the Morningstar 2000 Stock Option Plan, and the Morningstar 2001 Stock Option Plan.
The 2011 Plan provides for a variety of stock-based awards, including, among other things, restricted stock units, restricted stock, performance share awards, and stock options. We granted restricted stock units, restricted stock, and stock options under the 2004 Plan.
All of our employees and our non-employee directors are eligible for awards under the 2011 Plan.
Grants awarded under the 2011 Plan or the 2004 Plan that are forfeited, canceled, settled, or otherwise terminated without a distribution of shares, or shares withheld by us in connection with the exercise of options, will be available for awards under the 2011 Plan. Any shares subject to awards under the 2011 Plan, but not under the 2004 Plan, that are withheld by us in connection with the payment of any required income tax withholding will be available for awards under the 2011 Plan.
The following table summarizes the number of shares available for future grants under our 2011 Plan:
 
 
As of December 31
(000)
 
2014

Shares available for future grants
 
4,233


 
Accounting for Stock-Based Compensation Awards
 
The following table summarizes our stock-based compensation expense and the related income tax benefit we recorded in the past three years:
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Restricted stock units
 
$
16,307

 
$
14,163

 
$
13,451

Restricted stock
 
388

 
388

 
5,013

Performance share awards
 
505

 

 

Stock options
 
424

 
492

 
441

Total stock-based compensation expense
 
$
17,624

 
$
15,043

 
$
18,905

 
 
 
 
 
 
 
Income tax benefit related to the stock-based compensation expense
 
$
5,055

 
$
4,027

 
$
3,686



The following table summarizes the stock-based compensation expense included in each of our operating expense categories for the past three years:
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Cost of revenue
 
$
7,774

 
$
6,870

 
$
6,416

Sales and marketing
 
2,170

 
1,975

 
1,937

General and administrative
 
7,680

 
6,198

 
10,552

Total stock-based compensation expense
 
$
17,624

 
$
15,043

 
$
18,905



The following table summarizes the amount of unrecognized stock-based compensation expense as of December 31, 2014 and the expected number of months over which the expense will be recognized:
 
 
Unrecognized stock-based compensation expense ($000)

 
Expected amortization period (months)
Restricted stock units
 
$
33,064

 
32
Restricted stock
 
129

 
4
Performance share awards
 
453

 
24
Stock options
 
162

 
6
Total unrecognized stock-based compensation expense
 
$
33,808

 
32


In accordance with FASB ASC 718, Compensation—Stock Compensation, we estimate forfeitures of employee stock-based awards and recognize compensation cost only for those awards expected to vest. Our largest annual equity grants typically have vesting dates in the second quarter. We adjust the stock-based compensation expense annually in the third quarter to reflect those awards that ultimately vested and update our estimate of the forfeiture rate that will be applied to awards not yet vested.
 
Restricted Stock Units
 
Restricted stock units represent the right to receive a share of Morningstar common stock when that unit vests. Restricted stock units granted to employees vest ratably over a four-year period. Restricted stock units granted to non-employee directors vest ratably over a three-year period. For restricted stock units granted through December 31, 2008, employees could elect to defer receipt of the Morningstar common stock issued upon vesting of the restricted stock unit.

We measure the fair value of our restricted stock units on the date of grant based on the closing market price of the underlying common stock on the day prior to grant. We amortize that value to stock-based compensation expense, net of estimated forfeitures, ratably over the vesting period.

The following table summarizes restricted stock unit activity during the past three years:
Restricted Stock Units (RSUs)
 
Unvested

 
Vested but
Deferred

 
Total

 
Weighted
Average
Grant Date Value
per RSU

RSUs Outstanding - January 1, 2012
 
741,043

 
20,076

 
761,119

 
$
50.66

Granted
 
341,282

 

 
341,282

 
56.26

Dividend equivalents
 
6,405

 
130

 
6,535

 
52.02

Vested
 
(270,695
)
 

 
(270,695
)
 
50.12

Vested but deferred
 
(892
)
 
892

 

 

Issued
 

 
(2,316
)
 
(2,316
)
 
73.28

Forfeited
 
(89,998
)
 

 
(89,998
)
 
50.84

RSUs Outstanding - December 31, 2012
 
727,145

 
18,782

 
745,927

 
53.37

Granted
 
287,848

 

 
287,848

 
72.04

Dividend equivalents
 
2,773

 
157

 
2,930

 
57.39

Vested
 
(278,549
)
 

 
(278,549
)
 
50.41

Issued
 

 
(2,257
)
 
(2,257
)
 
49.40

Forfeited
 
(59,215
)
 

 
(59,215
)
 
57.58

RSUs Outstanding - December 31, 2013
 
680,002

 
16,682

 
696,684

 
62.02

Granted
 
279,524

 

 
279,524

 
72.68

Dividend equivalents
 
2,621

 
150

 
2,771

 
55.70

Vested
 
(268,115
)
 

 
(268,115
)
 
58.91

Issued
 

 
(2,054
)
 
(2,054
)
 
53.54

Forfeited
 
(38,098
)
 

 
(38,098
)
 
65.21

RSUs Outstanding - December 31, 2014
 
655,934

 
14,778

 
670,712

 
67.51



Restricted Stock
 
In conjunction with the 2010 Realpoint acquisition, we issued shares of restricted stock to the selling employee-shareholders which vest ratably over a five-year period from the acquisition date and may be subject to forfeiture if the holder terminates his or her employment during the vesting period.

Performance Share Awards

In 2014, we granted executive officers, other than Joe Mansueto, performance share awards pursuant to which each executive becomes entitled to a number of shares of Morningstar common stock equal to the number of notional performance shares that become vested. Each award specifies a number of performance shares that will vest if we attain pre-established target performance goals. The number of performance shares that actually vest may be more or less than the specified number of performance shares based on our performance relative to the target performance goals over a three-year period.

We base the grant date fair value for these awards on the closing market price of the underlying common stock on the day prior to the grant date. We amortize that value to stock-based compensation expense, based on the satisfaction of the performance condition that is most likely to be satisfied over the three-year service period ratably over the vesting period.

Information as of December 31, 2014 regarding our target performance share awards granted and shares that would be issued at current performance levels for performance share awards granted during 2014 is as follows:
 
 
As of December 31, 2014

Target performance share awards granted
 
23,685

Fair value per award (1)
 
$
80.91

Number of shares that would be issued based on current performance levels
 
11,843

Unamortized expense, based on current performance levels
 
$
453,000


(1) Represents the closing market price of Morningstar's stock on March 14, 2014, which is the last closing price prior to the grant date.

Stock Options

Stock options granted to employees vest ratably over a four-year period. Grants to our non-employee directors vest ratably over a three-year period. All grants expire 10 years after the date of grant. Almost all of the options granted under the 2004 Plan have a premium feature in which the exercise price increases over the term of the option at a rate equal to the 10-year Treasury bond yield as of the date of grant. Options granted under the 2011 Plan have an exercise price equal to the fair market value on the grant date.

In May 2011, we granted 86,106 stock options under the 2004 Stock Incentive Plan. In November 2011, we granted 6,095 stock options under the 2011 Plan. We estimated the fair value of the options on the grant date using a Black-Scholes option-pricing model. The weighted average fair value of options granted during 2011 was $23.81 per share, based on the following assumptions:

Assumptions for Black-Scholes Option Pricing Model
 
 
Expected life (years):
 
7.4

Volatility factor:
 
35.1
%
Dividend yield:
 
0.35
%
Interest rate:
 
2.87
%


The following tables summarize stock option activity in the past three years for our various stock option grants. The first table includes activity for options granted at an exercise price below the fair value per share of our common stock on the grant date; the second table includes activity for all other option grants.

 
 
2014
 
 
 
2013
 
 
 
2012
 
 
Options Granted At an Exercise Price Below the Fair Value Per Share on the Grant Date
 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

Options outstanding—beginning of year
 
179,559

 
$
21.47

 
282,695

 
$
20.55

 
398,859

 
$
19.72

Granted
 

 

 

 

 

 

Canceled
 
(150
)
 
22.24

 
(250
)
 
21.48

 
(650
)
 
14.70

Exercised
 
(179,409
)
 
22.08

 
(102,886
)
 
21.09

 
(115,514
)
 
20.19

Options outstanding—end of year
 

 

 
179,559

 
21.47

 
282,695

 
20.55

 
 
 
 
 
 
 
 
 
 
 
 
 
Options exercisable—end of year
 

 
$

 
179,559

 
$
21.47

 
282,695

 
$
20.55



 
 
2014
 
 
 
2013
 
 
 
2012
 
 
All Other Option Grants, Excluding Activity Shown Above
 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

Options outstanding—beginning of year
 
253,972

 
$
36.48

 
391,784

 
$
28.98

 
818,552

 
$
22.76

Granted
 

 

 

 

 

 

Canceled
 
(526
)
 
38.61

 
(1,352
)
 
16.19

 
(22,330
)
 
39.75

Exercised
 
(83,636
)
 
30.82

 
(136,460
)
 
16.84

 
(404,438
)
 
16.60

Options outstanding—end of year
 
169,810

 
40.20

 
253,972

 
36.48

 
391,784

 
28.98

 
 
 
 
 
 
 
 
 
 
 
 
 
Options exercisable—end of year
 
154,864

 
$
38.53

 
219,449

 
$
33.18

 
337,684

 
$
24.42



The following table summarizes the total intrinsic value (difference between the market value of our stock on the date of exercise and the exercise price of the option) of options exercised:
($000)
 
2014

 
2013

 
2012

Intrinsic value of options exercised
 
$
12,021

 
$
12,801

 
$
22,526


 
The table below shows additional information for options outstanding and exercisable as of December 31, 2014:
 
 
 
Options Outstanding
 
Options Exercisable
Range of Exercise Prices
 
Number of  Options

 
Weighted
Average
Remaining
Contractual
Life (years)
 
Weighted
Average
Exercise
Price

 
Aggregate
Intrinsic
Value
($000)

 
Exercisable Shares

 
Weighted Average Remaining Contractual Life (years)
 
Weighted Average Exercise Price

 
Aggregate Intrinsic Value ($000)

$27.54
 
96,354

 
0.34
 
$
27.54

 
$
3,582

 
96,354

 
0.34
 
$
27.54

 
$
3,582

$40.49 - $51.03
 
5,781

 
0.91
 
49.10

 
90

 
5,781

 
0.91
 
49.10

 
90

$57.28 - $59.35
 
67,675

 
6.51
 
57.47

 
490

 
52,729

 
6.51
 
57.46

 
358

$27.54 - $59.35
 
169,810

 
2.82
 
40.20

 
$
4,162

 
154,864

 
2.46
 
38.53

 
$
4,030

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Vested or Expected to Vest
 
 
 
 
 
 
 
 
 
 
 
 
 
$27.54 - $59.35
 
169,810

 
2.82
 
$
40.20

 
$
4,162

 
 
 
 
 
 
 
 

 
The aggregate intrinsic value in the table above represents the total pretax intrinsic value all option holders would have received if they had exercised all outstanding options on December 31, 2014. The intrinsic value is based on our closing stock price of $64.71 on that date.

Excess Tax Benefits Related to Stock-Based Compensation
 
FASB ASC 718, Compensation—Stock Compensation, requires that we classify the cash flows that result from excess tax benefits as financing cash flows. Excess tax benefits correspond to the portion of the tax deduction taken on our income tax return that exceeds the amount of tax benefit related to the compensation cost recognized in our Consolidated Statement of Income. The following table summarizes our excess tax benefits for the past three years:

($000)
 
2014

 
2013

 
2012

Excess tax benefits related to stock-based compensation
 
$
4,449

 
$
5,898

 
$
7,210

Defined Contribution Plan
Defined Contribution Plan
Defined Contribution Plan

We sponsor a defined contribution 401(k) plan, which allows our U.S.-based employees to voluntarily contribute pre-tax dollars up to a maximum amount allowable by the U.S. Internal Revenue Service. In 2014, 2013, and 2012, we made matching contributions to our 401(k) plan in the United States in an amount equal to 75 cents for every dollar of an employee's contribution, up to a maximum of 7% of the employee's compensation in the pay period.

The following table summarizes our matching contributions:
($000)
 
2014

 
2013

 
2012

401(k) matching contributions
 
$
7,451

 
$
6,879

 
$
6,642

Income Taxes
Income Taxes
Income Taxes
 
Income Tax Expense and Effective Tax Rate

The following table shows our income tax expense and our effective tax rate for the years ended December 31, 2014, 2013, and 2012:

($000)
 
2014

 
2013

 
2012

Income before income taxes and equity in net income of unconsolidated entities
 
$
113,898

 
$
178,010

 
$
153,625

Equity in net income of unconsolidated entities
 
39

 
1,428

 
2,027

Net loss attributable to the noncontrolling interest
 
42

 
122

 
117

Total
 
$
113,979

 
$
179,560

 
$
155,769

Income tax expense
 
$
35,678

 
$
56,031

 
$
52,878

Effective tax rate
 
31.3
%
 
31.2
%
 
33.9
%



The following table reconciles our income tax expense at the U.S. federal income tax rate of 35% to income tax expense as recorded:

 
 
2014
 
 
 
2013
 
 
 
2012
 
 
($000, except percentages)
 
Amount

 
%

 
Amount

 
%

 
Amount

 
%

Income tax expense at U.S. federal rate
 
$
39,893

 
35.0
 %
 
$
62,845

 
35.0
 %
 
$
54,519

 
35.0
 %
State income taxes, net of federal income tax benefit
 
2,129

 
1.9

 
3,029

 
1.7

 
1,510

 
1.0

Equity in net income of unconsolidated subsidiaries
 
(1,397
)
 
(1.2
)
 

 

 

 

Net change in valuation allowance related to non-U.S. deferred tax assets, primarily net operating losses
 
(600
)
 
(0.5
)
 
(1,842
)
 
(1.0
)
 
(630
)
 
(0.4
)
Difference between U.S. federal statutory and foreign tax rates
 
(3,961
)
 
(3.5
)
 
(2,513
)
 
(1.4
)
 
(2,777
)
 
(1.8
)
Change in unrecognized tax benefits
 
1,481

 
1.3

 
(211
)
 
(0.1
)
 
967

 
0.6

Credits and incentives
 
(2,924
)
 
(2.6
)
 
(4,374
)
 
(2.5
)
 
(1,494
)
 
(1.0
)
Recognition of deferred tax assets
 
(140
)
 
(0.1
)
 
(1,448
)
 
(0.8
)
 

 

Other - net
 
1,197

 
1.0

 
545

 
0.3

 
783

 
0.5

Total income tax expense
 
$
35,678

 
31.3
 %
 
$
56,031

 
31.2
 %
 
$
52,878

 
33.9
 %


Income tax expense consists of the following:

 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Current tax expense:
 
 
 
 
 
 
U.S.
 
 
 
 
 
 
Federal
 
$
20,726

 
$
42,808

 
$
38,821

State
 
1,996

 
3,882

 
1,997

Non-U.S.
 
9,638

 
10,456

 
5,719

Current tax expense
 
32,360

 
57,146

 
46,537

Deferred tax expense (benefit):
 
 
 
 
 
 
U.S.
 
 
 
 
 
 
Federal
 
3,668

 
2,630

 
6,287

State
 
1,326

 
814

 
334

Non-U.S.
 
(1,676
)
 
(4,559
)
 
(280
)
Deferred tax expense (benefit), net
 
3,318

 
(1,115
)
 
6,341

Income tax expense
 
$
35,678

 
$
56,031

 
$
52,878



The following table provides our income before income taxes and equity in net income of unconsolidated entities, generated by our U.S. and non-U.S. operations:

 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

U.S.
 
$
80,394

 
$
144,065

 
$
128,920

Non-U.S.
 
33,504

 
33,945

 
24,705

Income before income taxes and equity in net income of unconsolidated entities
 
$
113,898

 
$
178,010

 
$
153,625


Deferred Tax Assets and Liabilities

We recognize deferred income taxes for the temporary differences between the carrying amount of assets and liabilities for financial statement purposes and their tax basis. The tax effects of the temporary differences that give rise to the deferred income tax assets and liabilities are as follows:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Deferred tax assets:
 
 
 
 
Stock-based compensation expense
 
$
3,262

 
$
3,479

Accrued liabilities
 
13,632

 
9,805

Net operating loss carryforwards - U.S. federal and state
 
10,505

 
851

Net operating loss carryforwards - Non-U.S.
 
7,725

 
9,229

Deferred royalty revenue
 
354

 
366

Allowance for doubtful accounts
 
929

 
758

Deferred rent
 
10,019

 
8,673

Total deferred tax assets
 
46,426

 
33,161

 
 
 
 
 
Deferred tax liabilities:
 
 
 
 
Acquired intangible assets
 
(16,419
)
 
(12,967
)
Property, equipment, and capitalized software
 
(23,157
)
 
(15,525
)
Unrealized exchange gains, net
 
(174
)
 
(395
)
Prepaid expenses
 
(3,677
)
 
(4,299
)
Investments in unconsolidated entities
 
(12,836
)
 
(12,009
)
Other
 
(435
)
 
(373
)
Total deferred tax liabilities
 
(56,698
)
 
(45,568
)
Net deferred tax liability before valuation allowance
 
(10,272
)
 
(12,407
)
Valuation allowance
 
(6,706
)
 
(7,456
)
Net deferred tax liability
 
$
(16,978
)
 
$
(19,863
)


The deferred tax assets and liabilities are presented in our Consolidated Balance Sheets as follows:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Deferred tax asset, net - current
 
$
9,000

 
$
3,892

Deferred tax liability, net - non-current
 
(25,978
)
 
(23,755
)
Net deferred tax liability
 
$
(16,978
)
 
$
(19,863
)


The following table summarizes our U.S. net operating loss (NOL) carryforwards:

 
 
As of December 31
 
 
 
($000)
 
 
2014
 
 
2013
 
 
 
Expiration Date
 
 
Expiration Date
U.S. federal NOLs subject to expiration dates
 
$
30,015

2023-2034
 
$
2,136

12/31/2023


The year-over-year increase in U.S. federal NOL carryforward mainly reflects the two acquisitions we completed in 2014, as both HelloWallet and ByAllAccounts were startup companies that accumulated losses in their early stages of operation.

The following table summarizes our NOL carryforwards for our non-U.S. operations:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Non-U.S. NOLs subject to expiration dates from 2018 through 2034
 
$
5,240

 
$
5,314

Non-U.S. NOLs with no expiration date
 
32,628

 
40,054

Total
 
$
37,868

 
$
45,368

 
 
 
 
 
Non-U.S. NOLs not subject to valuation allowances
 
$
5,127

 
$
8,759



The decrease in non-U.S. NOL carryforwards as of December 31, 2014 compared with 2013 primarily reflects the use of NOL carryforwards in our non-U.S. operations.

We have not provided federal and state income taxes on accumulated undistributed earnings of certain foreign subsidiaries aggregating approximately $118,600,000 as of December 31, 2014, because these earnings have been permanently reinvested. It is not practicable to determine the amount of the unrecognized deferred tax liability related to the undistributed earnings.

In assessing the realizability of our deferred tax assets, we consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. We have recorded a valuation allowance against all but approximately $5,127,000 of the non-U.S. NOLs, reflecting the likelihood that the benefit of these NOLs will not be realized.

Uncertain Tax Positions

We conduct business globally and as a result, we file income tax returns in U.S. federal, state, local, and foreign jurisdictions. In the normal course of business we are subject to examination by tax authorities throughout the world. The open tax years for our U.S. Federal tax returns and most state tax returns include the years 2008 to the present. In non-U.S. jurisdictions, the statute of limitations generally extends to years prior to 2005.

We are currently under audit by federal, state and local tax authorities in the United States as well as tax authorities in certain non-U.S. jurisdictions. It is likely that the examination phase of some of these U.S. federal, state, local, and non-U.S. audits will conclude in 2015. It is not possible to estimate the effect of current audits on previously recorded unrecognized tax benefits.

As of December 31, 2014, our Consolidated Balance Sheet included a current liability of $5,124,000 and a non-current liability of $6,608,000 for unrecognized tax benefits. These amounts include interest and penalties, less any associated tax benefits.

The table below reconciles the beginning and ending amount of the gross unrecognized tax benefits as follows:

($000)
 
2014

 
2013

Gross unrecognized tax benefits - beginning of the year
 
$
12,958

 
$
12,699

Increases as a result of tax positions taken during a prior-year period
 
866

 
791

Decreases as a result of tax positions taken during a prior-year period
 
(54
)
 
(146
)
Increases as a result of tax positions taken during the current period
 
2,007

 
2,887

Decreases relating to settlements with tax authorities
 
(2,400
)
 
(2,779
)
Reductions as a result of lapse of the applicable statute of limitations
 
(1,455
)
 
(494
)
Gross unrecognized tax benefits - end of the year
 
$
11,922

 
$
12,958



In 2014, we recorded a net increase of $2,818,000 of gross unrecognized tax benefits before settlements and lapses of statutes of limitations, of which $2,818,000 increased our income tax expense by $2,572,000. In addition, we reduced our unrecognized tax benefits by $3,855,000 for settlements and lapses of statutes of limitations, of which $1,455,000 decreased our income tax expense by $1,269,000.

As of December 31, 2014, we had $11,922,000 of gross unrecognized tax benefits, of which $11,922,000, if recognized, would reduce our effective income tax rate and decrease our income tax expense by $10,565,000.

We record interest and penalties related to uncertain tax positions as part of our income tax expense. The following table summarizes our gross liability for interest and penalties:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Liabilities for interest and penalties
 
$
1,488

 
$
1,865



We recorded the decrease in the liability, net of any tax benefits, to income tax expense in our Consolidated Statement of Income in 2014.
Contingencies
Contingencies
Contingencies
 
We are involved in legal proceedings and litigation that have arisen in the normal course of our business. Although the outcome of a particular proceeding can never be predicted, we do not believe the result of any of these matters will have a material adverse effect on our business, operating results, or financial position.
Share Repurchase Program
Quarterly Dividend and Share Repurchase Programs
Share Repurchase Program
 
We have an ongoing authorization, originally approved by our board of directors in September 2010, and subsequently amended, to repurchase up to $700 million in shares of our outstanding common stock. The authorization expires on December 31, 2015. We may repurchase shares from time to time at prevailing market prices on the open market or in private transactions in amounts that we deem appropriate.

As of December 31, 2014, we had repurchased a total of 8,142,010 shares for $526.5 million under this authorization, leaving approximately $173.5 million available for future repurchases.
Subsequent Events
Subsequent Events
Subsequent Events

In February 2015, our board of directors declared a quarterly dividend of 19 cents per share. The dividend is payable on April 30, 2015 to shareholders of record as of April 10, 2015.
Recently Issued Accounting Pronouncements
Recently Issued Accounting Pronouncements
Recently Issued Accounting Pronouncements

On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in GAAP when it becomes effective. The new standard is effective for us on January 1, 2017. Early application is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing financial reporting.

Selected Quarterly Financial Data
Selected Quarterly Financial Data
Selected Quarterly Financial Data (unaudited)
 
 
2013

 
 
 
 
 
 
 
2014

 
 
 
 
 
 
(in thousands except per share amounts)
 
Q1

 
Q2

 
Q3

 
Q4

 
Q1

 
Q2

 
Q3

 
Q4

Revenue
 
$
168,856

 
$
175,428

 
$
173,482

 
$
180,500

 
$
181,165

 
$
189,385

 
$
193,106

 
$
196,415

Total operating expense
 
128,296

 
131,844

 
128,869

 
138,603

 
142,633

 
214,165

 
147,845

 
149,834

Operating income (loss)
 
40,560

 
43,584

 
44,613

 
41,897

 
38,532

 
(24,780
)
 
45,261

 
46,581

Non-operating income (expense), net
 
945

 
3,111

 
771

 
2,529

 
865

 
5,898

 
(298
)
 
1,839

Income (loss) before income taxes and equity in net income of unconsolidated entities
 
41,505

 
46,695

 
45,384

 
44,426

 
39,397

 
(18,882
)
 
44,963

 
48,420

Equity in net income (loss) of unconsolidated entities
 
497

 
360

 
315

 
256

 
599

 
497

 
337

 
(1,394
)
Income tax expense (benefit)
 
12,427

 
15,955

 
14,265

 
13,384

 
13,650

 
(8,611
)
 
15,149

 
15,490

Consolidated net income (loss)
 
29,575

 
31,100

 
31,434

 
31,298

 
26,346

 
(9,774
)
 
30,151

 
31,536

Net (income) loss attributable to the noncontrolling interests
 
43

 
21

 
29

 
29

 
30

 
5

 
29

 
(22
)
Net income (loss) attributable to Morningstar, Inc.
 
$
29,618

 
$
31,121

 
$
31,463

 
$
31,327

 
$
26,376

 
$
(9,769
)
 
$
30,180

 
$
31,514

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) per share attributable to Morningstar, Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
$
0.64

 
$
0.67

 
$
0.68

 
$
0.68

 
$
0.59

 
$
(0.22
)
 
$
0.67

 
$
0.71

Diluted

$
0.63


$
0.66


$
0.68


$
0.68


$
0.58


$
(0.22
)

$
0.67


$
0.71

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends per common share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends declared per common share
 
$
0.125

 
$
0.125

 
$

 
$
0.295

 
$
0.170

 
$
0.170

 
$
0.170

 
$
0.190

Dividends paid per common share
 
$

 
$
0.125

 
$
0.125

 
$
0.125

 
$
0.170

 
$
0.170

 
$
0.170

 
$
0.170

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
46,406

 
46,400

 
46,080

 
45,756

 
44,777

 
44,777

 
44,734

 
44,414

Diluted
 
46,814

 
46,853

 
46,519

 
46,211

 
45,093

 
44,777

 
44,889

 
44,548

Summary of Significant Accounting Policies (Policies)
Principles of Consolidation. We conduct our business operations through wholly owned or majority-owned operating subsidiaries. The accompanying consolidated financial statements include the accounts of Morningstar, Inc. and our subsidiaries. We consolidate assets, liabilities, and results of operations of subsidiaries in which we have a controlling interest and eliminate all significant intercompany accounts and transactions.

We account and report the noncontrolling (minority) interest in our Consolidated Financial Statements in accordance with FASB ASC 810, Consolidation. A noncontrolling interest is the portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to the parent company. We report the noncontrolling interest in our Consolidated Balance Sheet within equity separate from the shareholders' equity attributable to Morningstar, Inc. In addition, we present the net income (loss) and comprehensive income (loss) attributable to Morningstar, Inc.'s shareholders and the noncontrolling interest in our Consolidated Statements of Income, Consolidated Statements of Comprehensive Income, and Consolidated Statements of Equity.

We account for investments in entities in which we exercise significant influence, but do not control, using the equity method.

As part of our investment management operations, we manage certain funds outside of the United States that are considered variable interest entities. For the majority of these variable interest entities, we do not have a variable interest in them. In cases where we do have a variable interest, we are not the primary beneficiary. Accordingly, we do not consolidate any of these variable interest entities.
Comprehensive Income. In accordance with ASU No. 2011-05, Presentation of Comprehensive Income, we present the total of comprehensive income, the components of net income, and the components of other comprehensive income (OCI) in two separate but consecutive statements, our Consolidated Statements of Income and separately, our Consolidated Statements of Comprehensive Income. In addition, effective January 1, 2013, we adopted FASB ASU No. 2013-2, Comprehensive Income (Topic 220). We show the effects of items reclassified out of each component of accumulated other comprehensive income to net income on the face of the financial statement
Use of Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses during the reporting period. Actual results may differ from these estimates.
Reclassifications. Certain amounts reported in 2012 have been reclassified to conform to the 2013 presentation.

Separately, as a result of our move to a more centralized structure in 2013 (including new positions created, changes in focus for some existing roles, and the refinement of employee cost categorizations as we moved to a more centralized structure), approximately 180 net positions shifted from the general and administrative and sales and marketing categories to cost of revenue. These changes added approximately $14 million of compensation expense to cost of revenue in 2014 versus 2013 as well as in 2013 versus 2012, and reduced the compensation expense included in the sales and marketing and general and administrative categories by approximately $8 million and $6 million in each of these periods, respectively. These changes did not affect total operating expense or operating income for any of the periods presented.

Cash and Cash Equivalents. Cash and cash equivalents consists of cash and investments with original maturities of three months or less. We state them at cost, which approximates fair value. We state the portion of our cash equivalents that are invested in money market funds at fair value, as these funds are actively traded and have quoted market prices.
Investments. We account for our investments in accordance with FASB ASC 320, Investments—Debt and Equity Securities. We classify our investments into three categories: held-to-maturity, trading, and available-for-sale.

Held-to-maturity: We classify certain investments, primarily certificates of deposit, as held-to-maturity securities, based on our intent and ability to hold these securities to maturity. We record held-to-maturity investments at amortized cost in our Consolidated Balance Sheets.

Trading: We classify certain other investments, primarily equity securities, as trading securities, primarily to satisfy the requirements of one of our wholly owned subsidiaries, which is a registered broker-dealer. We include realized and unrealized gains and losses associated with these investments as a component of our operating income in our Consolidated Statements of Income. We record these securities at their fair value in our Consolidated Balance Sheets.

Available-for-sale: Investments not considered held-to-maturity or trading securities are classified as available-for-sale securities. Available-for-sale securities primarily consist of fixed-income securities. We report unrealized gains and losses for available-for-sale securities as other comprehensive income (loss), net of related income taxes. We record these securities at their fair value in our Consolidated Balance Sheets.
Fair Value Measurements. We follow FASB ASC 820, Fair Value Measurements. FASB ASC 820 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Under FASB ASC 820, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The standard applies whenever other standards require (or permit) assets or liabilities to be measured at fair value. The standard does not expand the use of fair value in any new circumstances and does not require any new fair value measurements.

Effective January 1, 2012, we adopted FASB ASU No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in GAAP and IFRS. ASU No. 2011-04 clarifies existing fair value measurement and disclosure requirements, amends certain fair value measurement principles, and requires additional disclosures about fair value measurements. The adoption of ASU No. 2011-04 did not have a material impact on our Consolidated Financial Statements.

FASB ASC 820 uses a fair value hierarchy based on three broad levels of valuation inputs:

Level 1: Valuations based on quoted prices in active markets for identical assets or liabilities that the company has the ability to access.

Level 2: Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3: Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

We provide additional information about our cash equivalents and investments that are subject to valuation under FASB ASC 820 in Note 7.

We account for our investments in accordance with FASB ASC 320, Investments—Debt and Equity Securities. We classify our investments into three categories: available-for-sale, held-to-maturity, and trading. Our investment portfolio is primarily invested in proprietary Morningstar portfolios, exchange-traded funds that seek to track the performance of certain Morningstar proprietary indexes, and various mutual funds.
Concentration of Credit Risk. No single customer is large enough to pose a significant credit risk to our operations or financial condition. For the years ended December 31, 2014, 2013, and 2012, no single customer represented 5% or more of our consolidated revenue. If receivables from our customers become delinquent, we begin a collections process. We maintain an allowance for doubtful accounts based on our estimate of the probable losses of accounts receivable.
Property, Equipment, and Depreciation. We state property and equipment at historical cost, net of accumulated depreciation. We depreciate property and equipment primarily using the straight-line method based on the useful life of the asset, which ranges from three to seven years. We amortize leasehold improvements over the lease term or their useful lives, whichever is shorter.
Computer Software and Internal Product Development Costs. We capitalize certain costs in accordance with FASB ASC 350-40, Internal-Use Software, FASB ASC 350-50, Website Development Costs, and FASB ASC 985, Software. Internal product development costs mainly consist of employee costs for developing new web-based products and certain major enhancements of existing products. We amortize these costs on a straight-line basis over the estimated economic life, which is generally three to five years. We include capitalized software development costs related to projects that have not been placed into service in our construction in progress balance.

The table below summarizes our capitalized software development costs for the past three years:
($000)
 
2014

 
2013

 
2012

Capitalized software development costs
 
$
18,804

 
$
8,142

 
$
8,527

Business Combinations. Over the past several years, we have acquired companies that complement our business operations. For each acquisition, we allocate the purchase price to the assets acquired, liabilities assumed, and goodwill. We follow FASB ASC 805, Business Combinations. We recognize and measure the fair value of the acquired operation as a whole, as well as the assets acquired and liabilities assumed, at their full fair values as of the date we obtain control, regardless of the percentage ownership in the acquired operation or how the acquisition was achieved. We expense direct costs related to the business combination, such as advisory, accounting, legal, valuation, and other professional fees, as incurred. We recognize restructuring costs, including severance and relocation for employees of the acquired entity, as post-combination expenses unless the target entity meets the criteria of FASB ASC 420, Exit or Disposal Cost Obligations, on the acquisition date.

As part of the purchase price allocation, we follow the requirements of FASB ASC 740, Income Taxes. This includes establishing deferred tax assets or liabilities reflecting the difference between the values assigned for financial statement purposes and income tax purposes. In certain acquisitions, the goodwill resulting from the purchase price allocation may not be deductible for income tax purposes. FASB ASC 740 prohibits recognition of a deferred tax asset or liability for temporary differences in goodwill if goodwill is not amortizable and deductible for tax purposes.
Goodwill. Changes in the carrying amount of our recorded goodwill are mainly the result of business acquisitions, divestitures, and the effect of foreign currency translations. In accordance with FASB ASC 350, Intangibles—Goodwill and Other, we do not amortize goodwill; instead, goodwill is subject to an impairment test annually, or whenever indicators of impairment exist. An impairment would occur if the carrying amount of a reporting unit exceeded the fair value of that reporting unit. We performed annual impairment reviews in the fourth quarter of 2014, 2013, and 2012. We did not record any significant impairment losses in 2014, 2013, and 2012.

Intangible Assets. We amortize intangible assets using the straight-line method over their estimated useful lives, which range from one to 25 years. We have no intangible assets with indefinite useful lives. In accordance with FASB ASC 360-10-35, Subsequent Measurement—Impairment or Disposal of Long Lived Assets, we review intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If the value of future undiscounted cash flows is less than the carrying amount of an asset group, we record an impairment loss based on the excess of the carrying amount over the fair value of the asset group. We did not record any impairment losses in 2014, 2013, or 2012.
Revenue Recognition. We recognize revenue in accordance with SEC SAB Topic 13, Revenue Recognition, ASC 605-25, Revenue Recognition: Multiple Element Arrangements, and ASC 985-605, Software: Revenue Recognition.

We recognize revenue when all of the following conditions are met:

There is persuasive evidence of an arrangement, as evidenced by a signed contract;
Delivery of our products and services has taken place. If arrangements include an acceptance provision, we generally begin recognizing revenue when we receive customer acceptance;
The amount of fees to be paid by the customer is fixed or determinable; and
The collectibility of the fees is reasonably assured.

We generate revenue through sales of Morningstar Data, Morningstar Advisor Workstation (including Morningstar Office), Morningstar Direct, Morningstar Research, Premium Membership subscriptions for Morningstar.com, our structured credit research and ratings offerings, and a variety of other investment-related products and services. We generally structure the revenue agreements for these offerings as licenses or subscriptions. We recognize revenue from licenses and subscription sales ratably as we deliver the product or service and over the service obligation period defined by the terms of the customer contract. For new-issue ratings and analysis for commercial mortgage- backed securities (CMBS), we charge asset-based fees that are paid by the issuer on the rated balance of the transaction and recognize the revenue immediately upon issuance.

We also generate revenue from Internet advertising, primarily from “impression-based” contracts. For advertisers who use our cost-per-impression pricing, we charge fees each time we display their ads on our site.

Our Investment Advisory business includes a broad range of services. Pricing for consulting services is based on the scope of work and the level of service provided, and includes asset-based fees for work we perform that involves investment management or acting as a subadvisor to investment portfolios. In arrangements that involve asset-based fees, we generally invoice clients quarterly in arrears based on average assets for the quarter. We recognize asset-based fees once the fees are fixed and determinable assuming all other revenue recognition criteria are met.

Our Retirement Solutions offerings help retirement plan participants plan and invest for retirement. We offer these services both through retirement plan providers (typically third-party asset management companies that offer proprietary mutual funds) and directly to plan sponsors (employers that offer retirement plans to their employees). For our Retirement Solutions offerings, we provide both a hosted solution as well as proprietary installed software advice solution. Clients can integrate the installed customized software into their existing systems to help investors accumulate wealth, transition into retirement, and manage income during retirement. The revenue arrangements for Retirement Solutions generally extend over multiple years. Our contracts may include one-time setup fees, implementation fees, technology licensing and maintenance fees, asset-based fees for managed retirement accounts, fixed and variable fees for advice and guidance, or a combination of these fee structures. Upon customer acceptance, we recognize revenue ratably over the term of the agreement. We recognize asset-based fees and variable fees in excess of any minimum once the value is fixed and determinable.

Some of our revenue arrangements combine multiple products and services. These products and services may be provided at different points in time or over different time periods within the same arrangement. We allocate fees to the separate deliverables based on the deliverables’ relative selling price, which is generally based on the price we charge when the same deliverable is sold separately.

We record taxes imposed on revenue-producing transactions (such as sales, use, value-added, and some excise taxes) on a net basis; therefore, we exclude such taxes from revenue in our Consolidated Statements of Income.

Deferred revenue represents the portion of licenses or subscriptions billed or collected in advance of the service being provided, which we expect to recognize as revenue in future periods. Certain arrangements may have cancellation or refund provisions. If we make a refund, it typically reflects the amount collected from a customer for which we have not yet provided services. The refund therefore results in a reduction of deferred revenue.

Advertising Costs. Advertising costs include expenses incurred for various print and Internet ads, search engine fees, and direct mail campaigns. We expense advertising costs as incurred. The table below summarizes our advertising expense for the past three years:
($000)
 
2014

 
2013

 
2012

Advertising expense
 
$
7,497

 
$
6,939

 
$
6,306


Stock-Based Compensation Expense. We account for our stock-based compensation expense in accordance with FASB ASC 718, Compensation—Stock Compensation. Our stock-based compensation expense reflects grants of restricted stock units, restricted stock, performance share awards, and stock options. We measure the fair value of our restricted stock units, restricted stock, and performance share awards on the date of grant based on the closing market price of Morningstar's common stock on the day prior to grant. For stock options, we estimate the fair value of our stock options on the date of grant using a Black-Scholes option-pricing model. We amortize the fair values to stock-based compensation expense, net of estimated forfeitures, ratably over the vesting period.

We estimate expected forfeitures of all employee stock-based awards and recognize compensation cost only for those awards expected to vest. We determine forfeiture rates based on historical experience and adjust the estimated forfeitures to actual forfeiture experience as needed.

Liability for Sabbatical Leave. In certain of our operations, we offer employees a sabbatical leave. Although the sabbatical policy varies by region, Morningstar's full-time employees are generally eligible for six weeks of paid time off after four years of continuous service. We account for our sabbatical liability in accordance with FASB ASC 710-10-25, Compensated Absences. We record a liability for employees' sabbatical benefits over the period employees earn the right for sabbatical leave and include this liability in Accrued Compensation in our Consolidated Balance Sheet.

Income Taxes. We record deferred income taxes for the temporary differences between the carrying amount of assets and liabilities for financial statement purposes and tax purposes in accordance with FASB ASC 740, Income Taxes. FASB ASC 740 prescribes the minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, and disclosure for uncertain tax positions.

We recognize interest and penalties related to unrecognized tax benefits as part of income tax expense in our Consolidated Statements of Income. We classify liabilities related to unrecognized tax benefits as either current or long-term liabilities in our Consolidated Balance Sheet, depending on when we expect to make payment.

Income per Share. We compute and present income per share in accordance with FASB ASC 260, Earnings Per Share. The difference between weighted average shares outstanding and diluted shares outstanding mainly reflects the dilutive effect associated with our stock-based compensation plans. We further compute income per share in accordance with FASB ASC 260-10-45-59A, Participating Securities and the Two Class Method. Under the two-class method, we allocate earnings between common stock and participating securities. The two-class method includes an earnings allocation formula that determines earnings per share for each class of common stock according to dividends declared and undistributed earnings for the period. For purposes of calculating earnings per share, we reduce our reported net earnings by the amount allocated to participating securities to arrive at the earnings allocated to common stock shareholders.

ASC 260-10-45-59A requires the dilutive effect of participating securities to be calculated using the more dilutive of the treasury stock or the two-class method. We have determined the two-class method to be the more dilutive. As such, we adjusted the earnings allocated to common stock shareholders in the basic earnings per share calculation for the reallocation of undistributed earnings to participating securities to calculate diluted earnings per share.

Foreign Currency. We translate the financial statements of non-U.S. subsidiaries to U.S. dollars using the period-end exchange rate for assets and liabilities and an average exchange rate for revenue and expense. We use the local currency as the functional currency for all of our non-U.S. subsidiaries. We record translation adjustments for non-U.S. subsidiaries as a component of “Other comprehensive income (loss)” in our Consolidated Statements of Comprehensive Income. We include exchange gains and losses arising from transactions denominated in currencies other than the functional currency in “Other income (expense), net” in our Consolidated Statements of Income.
Segment Information

We report our results in a single reportable segment, which reflects how our chief operating decision maker allocates resources and evaluates our financial results.

Because we have a single reportable segment, all required financial segment information can be found directly in the Consolidated Financial Statements.

The accounting policies for our reportable segment are the same as those described in Note 3. We evaluate the performance of our reporting segment based on revenue and operating income.
Correction (Tables)
Schedule of Error Corrections
The financial statements have been corrected to reduce the current balance and increase the long-term balance as shown in the table below:

 
 
As of December 31, 2013
($000)
 
Previously Reported

 
Correction

 
As Corrected

Accounts payable and accrued liabilities
 
$
52,877

 
$
(10,746
)
 
$
42,131

Deferred rent
 
$
13,192

 
$
10,746

 
$
23,938

Summary of Significant Accounting Policies (Tables)
The table below summarizes our advertising expense for the past three years:
($000)
 
2014

 
2013

 
2012

Advertising expense
 
$
7,497

 
$
6,939

 
$
6,306



The table below summarizes our capitalized software development costs for the past three years:
($000)
 
2014

 
2013

 
2012

Capitalized software development costs
 
$
18,804

 
$
8,142

 
$
8,527

Income Per Share (Tables)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Earnings Per Share [Abstract]
 
 
Schedule of Earnings Per Share, Basic and Diluted
 
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]
 
The following table shows how we reconcile our net income and the number of shares used in computing basic and diluted income per share:

(in thousands, except per share amounts)
 
2014

 
2013

 
2012

 
 
 
 
 
 
 
Basic net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Net income attributable to Morningstar, Inc.:
 
$
78,301

 
$
123,529

 
$
108,079

Less: Distributed earnings available to participating securities
 
(7
)
 
(10
)
 
(41
)
Less: Undistributed earnings available to participating securities
 
(9
)
 
(36
)
 
(47
)
Numerator for basic net income per share — undistributed and distributed earnings available to common shareholders
 
$
78,285

 
$
123,483

 
$
107,991

 
 
 
 
 
 
 
Weighted average common shares outstanding
 
44,675

 
46,158

 
48,497

 
 
 
 
 
 
 
Basic net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Continuing operations
 
$
1.75

 
$
2.68

 
$
2.12

Discontinued operations
 

 

 
0.11

Total
 
$
1.75

 
$
2.68

 
$
2.23

 
 
 
 
 
 
 
Diluted net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Numerator for basic net income per share — undistributed and distributed earnings available to common shareholders
 
$
78,285

 
$
123,483

 
$
107,991

Add: Undistributed earnings allocated to participating securities
 
9

 
36

 
47

Less: Undistributed earnings reallocated to participating securities
 
(9
)
 
(36
)
 
(46
)
Numerator for diluted net income per share — undistributed and distributed earnings available to common shareholders
 
$
78,285

 
$
123,483

 
$
107,992

 
 


 


 
 
Weighted average common shares outstanding
 
44,675

 
46,158

 
48,497

Net effect of dilutive stock options and restricted stock units
 
226

 
333

 
651

Weighted average common shares outstanding for computing diluted income per share
 
44,901

 
46,491

 
49,148

 
 


 


 
 
Diluted net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
Continuing operations
 
$
1.74

 
$
2.66

 
$
2.10

Discontinued operations
 

 

 
0.10

Total
 
$
1.74

 
$
2.66

 
$
2.20


The following table shows the number of weighted average stock options, restricted stock units, and performance share awards excluded from our calculation of diluted earnings per share from both continuing operations and net earnings because their inclusion would have been anti-dilutive:
(in thousands)
 
2014

 
2013

 
2012

Weighted average stock options
 

 

 
83

Weighted average restricted stock units
 
47

 
17

 
7

Weighted average performance share awards
 
6

 

 

Total
 
53

 
17

 
90


Stock options and restricted stock could be included in the calculation in the future.
Segment and Geographical Area Information (Tables)
Products and Services Information

We derive revenue from two product groups. The investment information product group includes all of our data, software, and research products and services. These products are typically sold through subscriptions or license agreements. The investment management product group includes all of our asset management operations, which earn the majority of their revenue from asset-based fees. The table below summarizes our revenue by product group:
 
External revenue by product group
 
 
 
 
 
 
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Investment information
 
$
597,046

 
$
555,642

 
$
526,147

Investment management
 
163,025

 
142,624

 
132,141

Consolidated revenue
 
$
760,071

 
$
698,266

 
$
658,288



External revenue by geographical area
 
 
 
 
 
 
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

United States
 
$
550,740

 
$
500,730

 
$
466,947

 
 
 
 
 
 
 
United Kingdom
 
61,844

 
56,298

 
56,794

Continental Europe
 
62,677

 
57,580

 
49,844

Australia
 
34,977

 
35,289

 
38,229

Canada
 
30,790

 
31,845

 
30,664

Asia
 
15,830

 
13,860

 
13,765

Other
 
3,213

 
2,664

 
2,045

Total International
 
209,331

 
197,536

 
191,341

 
 
 
 
 
 
 
Consolidated revenue
 
$
760,071

 
$
698,266

 
$
658,288


Long-lived assets by geographical area
 
 
 
 
 
 
As of December 31
($000)
 
2014

 
2013

United States
 
$
98,135

 
$
84,321

 
 
 
 
 
United Kingdom
 
8,014

 
6,873

Continental Europe
 
2,102

 
1,873

Australia
 
794

 
1,051

Canada
 
938

 
1,275

Asia
 
7,491

 
9,479

Other
 
87

 
114

Total International
 
19,426

 
20,665

 
 
 
 
 
Consolidated property, equipment, and capitalized software, net
 
$
117,561

 
$
104,986

Investments and Fair Value Measurements (Tables)
 
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Available-for-sale
 
$
13,187

 
$
91,461

Held-to-maturity
 
17,930

 
31,214

Trading securities
 
8,305

 
7,732

Total
 
$
39,422

 
$
130,407

The following table shows the cost, unrealized gains (losses), and fair values related to investments classified as available-for-sale and held-to-maturity:
 
 
 
As of December 31, 2014
 
As of December 31, 2013
($000)
 
Cost

 
Unrealized
Gain

 
Unrealized
Loss

 
Fair
Value

 
Cost

 
Unrealized
Gain

 
Unrealized
Loss

 
Fair
Value

Available-for-sale:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Government obligations
 
$

 
$

 
$

 
$

 
$
19,693

 
$
8

 
$
(3
)
 
$
19,698

Corporate bonds
 

 

 

 

 
49,913

 
22

 
(124
)
 
49,811

Foreign obligations
 

 

 

 

 
505

 

 
(2
)
 
503

Commercial paper
 

 

 

 

 
9,482

 
7

 

 
9,489

Equity securities and exchange-traded funds
 
11,428

 
796

 
(289
)
 
11,935

 
8,872

 
1,011

 
(141
)
 
9,742

Mutual funds
 
1,220

 
132

 
(100
)
 
1,252

 
2,095

 
221

 
(98
)
 
2,218

Total
 
$
12,648

 
$
928

 
$
(389
)
 
$
13,187

 
$
90,560

 
$
1,269

 
$
(368
)
 
$
91,461

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Held-to-maturity:
 
 
 
 
 
 
 
 
 
 

 
 

 
 

 
 

Certificates of deposit
 
$
17,930

 
$

 
$

 
$
17,930

 
$
31,214

 
$

 
$

 
$
31,214

The table below shows the cost and fair value of investments classified as available-for-sale and held-to-maturity based on their contractual maturities as of December 31, 2014 and December 31, 2013. The expected maturities of certain fixed-income securities may differ from their contractual maturities because some of these holdings have call features that allow the issuers the right to prepay obligations without penalties.
 
 
 
As of December 31, 2014
 
As of December 31, 2013
($000)
 
Cost

 
Fair Value

 
Cost

 
Fair Value

Available-for-sale:
 
 

 
 

 
 

 
 

Due in one year or less
 
$

 
$

 
$
45,486

 
$
45,402

Due in one to two years
 

 

 
34,107

 
34,099

Equity securities, exchange-traded funds, and mutual funds
 
12,648

 
13,187

 
10,967

 
11,960

Total
 
$
12,648

 
$
13,187

 
$
90,560

 
$
91,461

 
 
 
 
 
 
 
 
 
Held-to-maturity:
 
 

 
 

 
 

 
 

Due in one year or less
 
$
17,929

 
$
17,929

 
$
31,210

 
$
31,210

Due in one to three years
 
1

 
1

 
4

 
4

Total
 
$
17,930

 
$
17,930

 
$
31,214

 
$
31,214

The following table shows the realized gains and losses arising from sales of our investments classified as available-for-sale recorded in our Consolidated Statements of Income: 
($000)
 
2014

 
2013

 
2012

Realized gains
 
$
1,484

 
$
5,550

 
$
1,671

Realized losses
 
(466
)
 
(1,343
)
 
(1,133
)
Realized gains, net
 
$
1,018

 
$
4,207

 
$
538

The following table shows the net unrealized gains (losses) on trading securities as recorded in our Consolidated Statements of Income:
 
($000)
 
2014

 
2013

 
2012

Unrealized gains (losses), net
 
$
(188
)
 
$
827

 
$
269


 
 
 
Fair Value
 
Fair Value Measurements as of December 31, 2014
 
 
as of
 
Using Fair Value Hierarchy
($000)
 
December 31, 2014
 
Level 1

 
Level 2

 
Level 3

Available-for-sale investments
 
 

 
 

 
 

 
 

Government obligations
 
$

 
$

 
$

 
$

Corporate bonds
 

 

 

 

Foreign obligations
 

 

 

 

Commercial paper
 

 

 

 

Equity securities and exchange-traded funds
 
11,935

 
11,935

 

 

Mutual funds
 
1,252

 
1,252

 

 

Trading securities
 
8,305

 
8,305

 

 

Cash equivalents
 
512

 
512

 

 

Total
 
$
22,004

 
$
22,004

 
$

 
$

 
 
 
Fair Value
 
Fair Value Measurements as of December 31, 2013
 
 
as of
 
Using Fair Value Hierarchy
($000)
 
December 31, 2013
 
Level 1

 
Level 2

 
Level 3

Available-for-sale investments
 
 

 
 

 
 

 
 

Government obligations
 
$
19,698

 
$

 
$
19,698

 
$

Corporate bonds
 
49,811

 

 
49,811

 

Foreign obligations
 
503

 

 
503

 

Commercial paper
 
9,489

 

 
9,489

 

Equity securities and exchange-traded funds
 
9,742

 
9,742

 

 

Mutual funds
 
2,218

 
2,218

 

 

Trading securities
 
7,732

 
7,732

 

 

Cash equivalents
 
925

 
925

 

 

Total
 
$
100,118

 
$
20,617

 
$
79,501

 
$

Acquisitions, Goodwill, and Other Intangible Assets (Tables)
The following table summarizes our preliminary allocation of the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition, all of which are preliminary pending completion of the final valuation:
 
 
($000)

Cash and cash equivalents
 
$
3,739

Accounts receivable and other current assets
 
150

Other current and non-current assets
 
318

Deferred tax asset
 
8,646

Intangible assets
 
9,460

Goodwill
 
39,166

Deferred revenue
 
(2,897
)
Deferred tax liability
 
(3,595
)
Other current and non-current liabilities
 
(981
)
Total fair value of HelloWallet
 
$
54,006

The following table summarizes our preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition, all of which are preliminary pending completion of the final valuation:
 
 
($000)

Cash and cash equivalents
 
$
287

Accounts receivable and other current assets
 
152

Deferred tax asset
 
3,987

Other current and non-current assets
 
257

Intangible assets
 
8,681

Goodwill
 
18,476

Deferred revenue
 
(79
)
Deferred tax liability
 
(3,299
)
Other current and non-current liabilities
 
(513
)
Total purchase price
 
$
27,949

The following table summarizes our allocation of the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition:
 
 
($000)

Cash and cash equivalents
 
$
3,472

Accounts receivable and other current assets
 
519

Other non-current assets
 
244

Intangible assets
 
9,700

Goodwill
 
8,911

Deferred revenue
 
(1,191
)
Deferred tax liability
 
(2,272
)
Other current and non-current liabilities
 
(870
)
Total fair value of Morningstar Sweden
 
$
18,513

The allocation included acquired intangible assets, as follows:
 
 
($000)

 
Weighted Average Useful Life (years)
Customer-related assets
 
$
9,700

 
14
Total intangible assets
 
$
9,700

 
14
The following table shows the changes in our goodwill balances from January 1, 2013 to December 31, 2014:
 
 
 
($000)

Balance as of January 1, 2013
 
$
320,845

Acquisition of remaining ownership in Morningstar Sweden
 
8,911

Other, primarily foreign currency translation
 
(3,306
)
Balance as of December 31, 2013
 
$
326,450

Acquisition of HelloWallet and ByAllAccounts
 
57,642

Foreign currency translation
 
(14,038
)
Balance as of December 31, 2014
 
$
370,054

The following table summarizes our intangible assets: 
 
 
As of December 31, 2014
 
As of December 31, 2013
($000)
 
Gross

 
Accumulated
Amortization

 
Net

 
Weighted
Average
Useful  Life
(years)
 
Gross

 
Accumulated
Amortization

 
Net

 
Weighted
Average
Useful  Life
(years)
Intellectual property
 
$
29,026

 
$
(25,033
)
 
$
3,993

 
9
 
$
29,477

 
$
(23,128
)
 
$
6,349

 
9
Customer-related assets
 
141,497

 
(83,582
)
 
57,915

 
12
 
141,833

 
(74,311
)
 
67,522

 
12
Supplier relationships
 
240

 
(120
)
 
120

 
20
 
240

 
(108
)
 
132

 
20
Technology-based assets
 
88,816

 
(57,395
)
 
31,421

 
8
 
80,489

 
(50,673
)
 
29,816

 
9
Non-competition agreement
 
4,339

 
(1,883
)
 
2,456

 
5
 
1,661

 
(1,571
)
 
90

 
4
Total intangible assets
 
$
263,918

 
$
(168,013
)
 
$
95,905

 
10
 
$
253,700

 
$
(149,791
)
 
$
103,909

 
10
 
The following table summarizes our amortization expense related to intangible assets:
($000)
 
2014

 
2013

 
2012

Amortization expense
 
$
22,264

 
$
21,454

 
$
23,944

Based on acquisitions and divestitures completed through December 31, 2014, we expect intangible amortization expense for 2015 and subsequent years to be as follows:
 
 
($000)

2015
 
$
21,920

2016
 
17,394

2017
 
12,941

2018
 
10,790

2019
 
8,046

Thereafter
 
24,814

The preliminary allocation includes $8,681,000 of acquired intangible assets, as follows:

 
 
($000)

 
Weighted Average Useful Life (years)
Customer-related assets
 
$
5,506

 
24
Technology-based assets
 
3,020

 
4.5
Intellectual property (trademarks and trade names)
 
47

 
1
Non-competition agreement
 
108

 
3
Total intangible assets
 
$
8,681

 
19
The preliminary allocation includes $9,460,000 of acquired intangible assets, as follows:
 
 
($000)

 
Weighted Average Useful Life (years)
Technology based assets
 
6,670

 
5
Intellectual property (trademarks and trade names)
 
169

 
3
Non-competition agreement
 
2,621

 
5
Total intangible assets
 
$
9,460

 
5
Discontinued Operations (Tables)
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block]
The following table summarizes the amounts included in our Consolidated Statements of Income for discontinued operations for the years ended December 31, 2014, 2013, and 2012:

($000)
 
2014

 
2013

 
2012

Gain on sales of businesses
 
$

 
$

 
$
6,193

Income tax expense
 

 

 
1,005

Earnings from discontinued operations, net of tax
 
$

 
$

 
$
5,188

Investments in Unconsolidated Entities (Tables)
Our investments in unconsolidated entities consist primarily of the following:
 
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Investment in MJKK
 
$
23,014

 
$
21,782

Other equity method investments
 
3,475

 
6,166

Investments accounted for using the cost method
 
2,309

 
10,766

Total investments in unconsolidated entities
 
$
28,798

 
$
38,714

 
 
As of December 31
 
 
 
 
2014

 
2013

Morningstar’s approximate ownership of MJKK
 
34
%
 
34
%
Approximate market value of Morningstar’s ownership in MJKK:
 
 

 
 

Japanese yen (¥000)
 
¥
7,347,413

 
¥
9,824,068

Equivalent U.S. dollars ($000)
 
$
61,277

 
$
94,999

Property, Equipment, and Capitalized Software Property, Equipment, and Capitalized Software (Tables)
The following table shows our property, equipment, and capitalized software summarized by major category:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Computer equipment
 
$
53,420

 
$
47,830

Capitalized software
 
87,764

 
50,360

Furniture and fixtures
 
23,172

 
23,259

Leasehold improvements
 
54,320

 
52,512

Telephone equipment
 
1,948

 
2,032

Construction in progress
 
29,870

 
35,159

Property, equipment, and capitalized software, at cost
 
250,494

 
211,152

Less accumulated depreciation
 
(132,933
)
 
(106,166
)
Property, equipment, and capitalized software, net
 
$
117,561

 
$
104,986


The following table shows the amount of capitalized software development costs included in construction in progress:
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Capitalized software development costs not yet placed into service
 
$
18,070

 
$
11,345

The following table summarizes our depreciation expense:
($000)
 
2014

 
2013

 
2012

Depreciation expense
 
$
32,622

 
$
24,239

 
$
19,152

Operating Leases Operating Leases (Tables)
The following table shows our minimum future rental commitments due in each of the next five years and thereafter for all non-cancelable operating leases, consisting primarily of leases for office space:
Minimum Future Rental Commitments
 
($000)

2015
 
$
19,395

2016
 
20,299

2017
 
19,270

2018
 
16,916

2019
 
12,632

Thereafter
 
48,203

Total
 
$
136,715


The following table summarizes our rent expense including taxes, insurance, and related operating costs:

($000)
 
2014

 
2013

 
2012

Rent expense
 
$
24,460

 
$
22,169

 
$
20,736

Deferred rent includes build-out and rent abatement allowances received, which are amortized over the remaining portion of the original term of the lease as a reduction in office lease expense. We include deferred rent, as appropriate, in “Accounts payable and accrued liabilities” and “Deferred rent, noncurrent” on our Consolidated Balance Sheets.
 
 
As of December 31
 
 
($000)
 
2014

 
2013

Deferred rent
 
$
29,124

 
$
26,157

Stock-Based Compensation (Tables)
The following table summarizes the number of shares available for future grants under our 2011 Plan:
 
 
As of December 31
(000)
 
2014

Shares available for future grants
 
4,233

The following table summarizes our stock-based compensation expense and the related income tax benefit we recorded in the past three years:
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Restricted stock units
 
$
16,307

 
$
14,163

 
$
13,451

Restricted stock
 
388

 
388

 
5,013

Performance share awards
 
505

 

 

Stock options
 
424

 
492

 
441

Total stock-based compensation expense
 
$
17,624

 
$
15,043

 
$
18,905

 
 
 
 
 
 
 
Income tax benefit related to the stock-based compensation expense
 
$
5,055

 
$
4,027

 
$
3,686

The following table summarizes the stock-based compensation expense included in each of our operating expense categories for the past three years:
 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Cost of revenue
 
$
7,774

 
$
6,870

 
$
6,416

Sales and marketing
 
2,170

 
1,975

 
1,937

General and administrative
 
7,680

 
6,198

 
10,552

Total stock-based compensation expense
 
$
17,624

 
$
15,043

 
$
18,905

The following table summarizes the amount of unrecognized stock-based compensation expense as of December 31, 2014 and the expected number of months over which the expense will be recognized:
 
 
Unrecognized stock-based compensation expense ($000)

 
Expected amortization period (months)
Restricted stock units
 
$
33,064

 
32
Restricted stock
 
129

 
4
Performance share awards
 
453

 
24
Stock options
 
162

 
6
Total unrecognized stock-based compensation expense
 
$
33,808

 
32
The following table summarizes restricted stock unit activity during the past three years:
Restricted Stock Units (RSUs)
 
Unvested

 
Vested but
Deferred

 
Total

 
Weighted
Average
Grant Date Value
per RSU

RSUs Outstanding - January 1, 2012
 
741,043

 
20,076

 
761,119

 
$
50.66

Granted
 
341,282

 

 
341,282

 
56.26

Dividend equivalents
 
6,405

 
130

 
6,535

 
52.02

Vested
 
(270,695
)
 

 
(270,695
)
 
50.12

Vested but deferred
 
(892
)
 
892

 

 

Issued
 

 
(2,316
)
 
(2,316
)
 
73.28

Forfeited
 
(89,998
)
 

 
(89,998
)
 
50.84

RSUs Outstanding - December 31, 2012
 
727,145

 
18,782

 
745,927

 
53.37

Granted
 
287,848

 

 
287,848

 
72.04

Dividend equivalents
 
2,773

 
157

 
2,930

 
57.39

Vested
 
(278,549
)
 

 
(278,549
)
 
50.41

Issued
 

 
(2,257
)
 
(2,257
)
 
49.40

Forfeited
 
(59,215
)
 

 
(59,215
)
 
57.58

RSUs Outstanding - December 31, 2013
 
680,002

 
16,682

 
696,684

 
62.02

Granted
 
279,524

 

 
279,524

 
72.68

Dividend equivalents
 
2,621

 
150

 
2,771

 
55.70

Vested
 
(268,115
)
 

 
(268,115
)
 
58.91

Issued
 

 
(2,054
)
 
(2,054
)
 
53.54

Forfeited
 
(38,098
)
 

 
(38,098
)
 
65.21

RSUs Outstanding - December 31, 2014
 
655,934

 
14,778

 
670,712

 
67.51

Information as of December 31, 2014 regarding our target performance share awards granted and shares that would be issued at current performance levels for performance share awards granted during 2014 is as follows:
 
 
As of December 31, 2014

Target performance share awards granted
 
23,685

Fair value per award (1)
 
$
80.91

Number of shares that would be issued based on current performance levels
 
11,843

Unamortized expense, based on current performance levels
 
$
453,000


(1) Represents the closing market price of Morningstar's stock on March 14, 2014, which is the last closing price prior to the grant date.
In May 2011, we granted 86,106 stock options under the 2004 Stock Incentive Plan. In November 2011, we granted 6,095 stock options under the 2011 Plan. We estimated the fair value of the options on the grant date using a Black-Scholes option-pricing model. The weighted average fair value of options granted during 2011 was $23.81 per share, based on the following assumptions:

Assumptions for Black-Scholes Option Pricing Model
 
 
Expected life (years):
 
7.4

Volatility factor:
 
35.1
%
Dividend yield:
 
0.35
%
Interest rate:
 
2.87
%
The first table includes activity for options granted at an exercise price below the fair value per share of our common stock on the grant date; the second table includes activity for all other option grants.

 
 
2014
 
 
 
2013
 
 
 
2012
 
 
Options Granted At an Exercise Price Below the Fair Value Per Share on the Grant Date
 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

Options outstanding—beginning of year
 
179,559

 
$
21.47

 
282,695

 
$
20.55

 
398,859

 
$
19.72

Granted
 

 

 

 

 

 

Canceled
 
(150
)
 
22.24

 
(250
)
 
21.48

 
(650
)
 
14.70

Exercised
 
(179,409
)
 
22.08

 
(102,886
)
 
21.09

 
(115,514
)
 
20.19

Options outstanding—end of year
 

 

 
179,559

 
21.47

 
282,695

 
20.55

 
 
 
 
 
 
 
 
 
 
 
 
 
Options exercisable—end of year
 

 
$

 
179,559

 
$
21.47

 
282,695

 
$
20.55

 
 
2014
 
 
 
2013
 
 
 
2012
 
 
All Other Option Grants, Excluding Activity Shown Above
 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

 
Underlying
Shares

 
Weighted
Average
Exercise
Price

Options outstanding—beginning of year
 
253,972

 
$
36.48

 
391,784

 
$
28.98

 
818,552

 
$
22.76

Granted
 

 

 

 

 

 

Canceled
 
(526
)
 
38.61

 
(1,352
)
 
16.19

 
(22,330
)
 
39.75

Exercised
 
(83,636
)
 
30.82

 
(136,460
)
 
16.84

 
(404,438
)
 
16.60

Options outstanding—end of year
 
169,810

 
40.20

 
253,972

 
36.48

 
391,784

 
28.98

 
 
 
 
 
 
 
 
 
 
 
 
 
Options exercisable—end of year
 
154,864

 
$
38.53

 
219,449

 
$
33.18

 
337,684

 
$
24.42

The following table summarizes the total intrinsic value (difference between the market value of our stock on the date of exercise and the exercise price of the option) of options exercised:
($000)
 
2014

 
2013

 
2012

Intrinsic value of options exercised
 
$
12,021

 
$
12,801

 
$
22,526

The table below shows additional information for options outstanding and exercisable as of December 31, 2014:
 
 
 
Options Outstanding
 
Options Exercisable
Range of Exercise Prices
 
Number of  Options

 
Weighted
Average
Remaining
Contractual
Life (years)
 
Weighted
Average
Exercise
Price

 
Aggregate
Intrinsic
Value
($000)

 
Exercisable Shares

 
Weighted Average Remaining Contractual Life (years)
 
Weighted Average Exercise Price

 
Aggregate Intrinsic Value ($000)

$27.54
 
96,354

 
0.34
 
$
27.54

 
$
3,582

 
96,354

 
0.34
 
$
27.54

 
$
3,582

$40.49 - $51.03
 
5,781

 
0.91
 
49.10

 
90

 
5,781

 
0.91
 
49.10

 
90

$57.28 - $59.35
 
67,675

 
6.51
 
57.47

 
490

 
52,729

 
6.51
 
57.46

 
358

$27.54 - $59.35
 
169,810

 
2.82
 
40.20

 
$
4,162

 
154,864

 
2.46
 
38.53

 
$
4,030

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Vested or Expected to Vest
 
 
 
 
 
 
 
 
 
 
 
 
 
$27.54 - $59.35
 
169,810

 
2.82
 
$
40.20

 
$
4,162

 
 
 
 
 
 
 
 
The following table summarizes our excess tax benefits for the past three years:

($000)
 
2014

 
2013

 
2012

Excess tax benefits related to stock-based compensation
 
$
4,449

 
$
5,898

 
$
7,210

Defined Contribution Plan (Tables)
Schedule of Defined Contribution Plan, Employer Matching Contributions
The following table summarizes our matching contributions:
($000)
 
2014

 
2013

 
2012

401(k) matching contributions
 
$
7,451

 
$
6,879

 
$
6,642



Income Taxes (Tables)
The following table shows our income tax expense and our effective tax rate for the years ended December 31, 2014, 2013, and 2012:

($000)
 
2014

 
2013

 
2012

Income before income taxes and equity in net income of unconsolidated entities
 
$
113,898

 
$
178,010

 
$
153,625

Equity in net income of unconsolidated entities
 
39

 
1,428

 
2,027

Net loss attributable to the noncontrolling interest
 
42

 
122

 
117

Total
 
$
113,979

 
$
179,560

 
$
155,769

Income tax expense
 
$
35,678

 
$
56,031

 
$
52,878

Effective tax rate
 
31.3
%
 
31.2
%
 
33.9
%
The following table reconciles our income tax expense at the U.S. federal income tax rate of 35% to income tax expense as recorded:

 
 
2014
 
 
 
2013
 
 
 
2012
 
 
($000, except percentages)
 
Amount

 
%

 
Amount

 
%

 
Amount

 
%

Income tax expense at U.S. federal rate
 
$
39,893

 
35.0
 %
 
$
62,845

 
35.0
 %
 
$
54,519

 
35.0
 %
State income taxes, net of federal income tax benefit
 
2,129

 
1.9

 
3,029

 
1.7

 
1,510

 
1.0

Equity in net income of unconsolidated subsidiaries
 
(1,397
)
 
(1.2
)
 

 

 

 

Net change in valuation allowance related to non-U.S. deferred tax assets, primarily net operating losses
 
(600
)
 
(0.5
)
 
(1,842
)
 
(1.0
)
 
(630
)
 
(0.4
)
Difference between U.S. federal statutory and foreign tax rates
 
(3,961
)
 
(3.5
)
 
(2,513
)
 
(1.4
)
 
(2,777
)
 
(1.8
)
Change in unrecognized tax benefits
 
1,481

 
1.3

 
(211
)
 
(0.1
)
 
967

 
0.6

Credits and incentives
 
(2,924
)
 
(2.6
)
 
(4,374
)
 
(2.5
)
 
(1,494
)
 
(1.0
)
Recognition of deferred tax assets
 
(140
)
 
(0.1
)
 
(1,448
)
 
(0.8
)
 

 

Other - net
 
1,197

 
1.0

 
545

 
0.3

 
783

 
0.5

Total income tax expense
 
$
35,678

 
31.3
 %
 
$
56,031

 
31.2
 %
 
$
52,878

 
33.9
 %
Income tax expense consists of the following:

 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

Current tax expense:
 
 
 
 
 
 
U.S.
 
 
 
 
 
 
Federal
 
$
20,726

 
$
42,808

 
$
38,821

State
 
1,996

 
3,882

 
1,997

Non-U.S.
 
9,638

 
10,456

 
5,719

Current tax expense
 
32,360

 
57,146

 
46,537

Deferred tax expense (benefit):
 
 
 
 
 
 
U.S.
 
 
 
 
 
 
Federal
 
3,668

 
2,630

 
6,287

State
 
1,326

 
814

 
334

Non-U.S.
 
(1,676
)
 
(4,559
)
 
(280
)
Deferred tax expense (benefit), net
 
3,318

 
(1,115
)
 
6,341

Income tax expense
 
$
35,678

 
$
56,031

 
$
52,878

The following table provides our income before income taxes and equity in net income of unconsolidated entities, generated by our U.S. and non-U.S. operations:

 
 
Year ended December 31
($000)
 
2014

 
2013

 
2012

U.S.
 
$
80,394

 
$
144,065

 
$
128,920

Non-U.S.
 
33,504

 
33,945

 
24,705

Income before income taxes and equity in net income of unconsolidated entities
 
$
113,898

 
$
178,010

 
$
153,625

The tax effects of the temporary differences that give rise to the deferred income tax assets and liabilities are as follows:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Deferred tax assets:
 
 
 
 
Stock-based compensation expense
 
$
3,262

 
$
3,479

Accrued liabilities
 
13,632

 
9,805

Net operating loss carryforwards - U.S. federal and state
 
10,505

 
851

Net operating loss carryforwards - Non-U.S.
 
7,725

 
9,229

Deferred royalty revenue
 
354

 
366

Allowance for doubtful accounts
 
929

 
758

Deferred rent
 
10,019

 
8,673

Total deferred tax assets
 
46,426

 
33,161

 
 
 
 
 
Deferred tax liabilities:
 
 
 
 
Acquired intangible assets
 
(16,419
)
 
(12,967
)
Property, equipment, and capitalized software
 
(23,157
)
 
(15,525
)
Unrealized exchange gains, net
 
(174
)
 
(395
)
Prepaid expenses
 
(3,677
)
 
(4,299
)
Investments in unconsolidated entities
 
(12,836
)
 
(12,009
)
Other
 
(435
)
 
(373
)
Total deferred tax liabilities
 
(56,698
)
 
(45,568
)
Net deferred tax liability before valuation allowance
 
(10,272
)
 
(12,407
)
Valuation allowance
 
(6,706
)
 
(7,456
)
Net deferred tax liability
 
$
(16,978
)
 
$
(19,863
)
The deferred tax assets and liabilities are presented in our Consolidated Balance Sheets as follows:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Deferred tax asset, net - current
 
$
9,000

 
$
3,892

Deferred tax liability, net - non-current
 
(25,978
)
 
(23,755
)
Net deferred tax liability
 
$
(16,978
)
 
$
(19,863
)

The table below reconciles the beginning and ending amount of the gross unrecognized tax benefits as follows:

($000)
 
2014

 
2013

Gross unrecognized tax benefits - beginning of the year
 
$
12,958

 
$
12,699

Increases as a result of tax positions taken during a prior-year period
 
866

 
791

Decreases as a result of tax positions taken during a prior-year period
 
(54
)
 
(146
)
Increases as a result of tax positions taken during the current period
 
2,007

 
2,887

Decreases relating to settlements with tax authorities
 
(2,400
)
 
(2,779
)
Reductions as a result of lapse of the applicable statute of limitations
 
(1,455
)
 
(494
)
Gross unrecognized tax benefits - end of the year
 
$
11,922

 
$
12,958



 The following table summarizes our gross liability for interest and penalties:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Liabilities for interest and penalties
 
$
1,488

 
$
1,865

The following table summarizes our U.S. net operating loss (NOL) carryforwards:

 
 
As of December 31
 
 
 
($000)
 
 
2014
 
 
2013
 
 
 
Expiration Date
 
 
Expiration Date
U.S. federal NOLs subject to expiration dates
 
$
30,015

2023-2034
 
$
2,136

12/31/2023
The following table summarizes our NOL carryforwards for our non-U.S. operations:

 
 
As of December 31
 
 
($000)
 
2014

 
2013

Non-U.S. NOLs subject to expiration dates from 2018 through 2034
 
$
5,240

 
$
5,314

Non-U.S. NOLs with no expiration date
 
32,628

 
40,054

Total
 
$
37,868

 
$
45,368

 
 
 
 
 
Non-U.S. NOLs not subject to valuation allowances
 
$
5,127

 
$
8,759

Selected Quarterly Financial Data (Tables)
Schedule of Quarterly Financial Data
 
 
2013

 
 
 
 
 
 
 
2014

 
 
 
 
 
 
(in thousands except per share amounts)
 
Q1

 
Q2

 
Q3

 
Q4

 
Q1

 
Q2

 
Q3

 
Q4

Revenue
 
$
168,856

 
$
175,428

 
$
173,482

 
$
180,500

 
$
181,165

 
$
189,385

 
$
193,106

 
$
196,415

Total operating expense
 
128,296

 
131,844

 
128,869

 
138,603

 
142,633

 
214,165

 
147,845

 
149,834

Operating income (loss)
 
40,560

 
43,584

 
44,613

 
41,897

 
38,532

 
(24,780
)
 
45,261

 
46,581

Non-operating income (expense), net
 
945

 
3,111

 
771

 
2,529

 
865

 
5,898

 
(298
)
 
1,839

Income (loss) before income taxes and equity in net income of unconsolidated entities
 
41,505

 
46,695

 
45,384

 
44,426

 
39,397

 
(18,882
)
 
44,963

 
48,420

Equity in net income (loss) of unconsolidated entities
 
497

 
360

 
315

 
256

 
599

 
497

 
337

 
(1,394
)
Income tax expense (benefit)
 
12,427

 
15,955

 
14,265

 
13,384

 
13,650

 
(8,611
)
 
15,149

 
15,490

Consolidated net income (loss)
 
29,575

 
31,100

 
31,434

 
31,298

 
26,346

 
(9,774
)
 
30,151

 
31,536

Net (income) loss attributable to the noncontrolling interests
 
43

 
21

 
29

 
29

 
30

 
5

 
29

 
(22
)
Net income (loss) attributable to Morningstar, Inc.
 
$
29,618

 
$
31,121

 
$
31,463

 
$
31,327

 
$
26,376

 
$
(9,769
)
 
$
30,180

 
$
31,514

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) per share attributable to Morningstar, Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
$
0.64

 
$
0.67

 
$
0.68

 
$
0.68

 
$
0.59

 
$
(0.22
)
 
$
0.67

 
$
0.71

Diluted

$
0.63


$
0.66


$
0.68


$
0.68


$
0.58


$
(0.22
)

$
0.67


$
0.71

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends per common share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends declared per common share
 
$
0.125

 
$
0.125

 
$

 
$
0.295

 
$
0.170

 
$
0.170

 
$
0.170

 
$
0.190

Dividends paid per common share
 
$

 
$
0.125

 
$
0.125

 
$
0.125

 
$
0.170

 
$
0.170

 
$
0.170

 
$
0.170

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
46,406

 
46,400

 
46,080

 
45,756

 
44,777

 
44,777

 
44,734

 
44,414

Diluted
 
46,814

 
46,853

 
46,519

 
46,211

 
45,093

 
44,777

 
44,889

 
44,548

Description of Business (Details)
Dec. 31, 2014
Countries
Organization, Consolidation and Presentation of Financial Statements [Abstract]
 
Number of countries in which entity operates
27 
Correction (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Accounts payable and accrued liabilities
$ 34,268 
$ 42,131 
Deferred rent
26,390 
23,938 
Previously Reported
 
 
Accounts payable and accrued liabilities
 
52,877 
Deferred rent
 
13,192 
Correction
 
 
Accounts payable and accrued liabilities
 
(10,746)
Deferred rent
 
$ 10,746 
Summary of Significant Accounting Policies (Details) (USD $)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Business Acquisition [Line Items]
 
 
 
capitalized software development costs
$ 18,804,000 
$ 8,142,000 
$ 8,527,000 
Advertising expense
7,497,000 
6,939,000 
6,306,000 
Intangible Assets, useful life, minimum
10 years 
10 years 
 
Correction
 
 
 
Business Acquisition [Line Items]
 
 
 
Reorganization, Number of Positions Shifted
180 
 
 
Cost of Revenue [Member] |
Correction
 
 
 
Business Acquisition [Line Items]
 
 
 
Compensation
14,000,000 
 
 
General and Administrative Expense [Member] |
Correction
 
 
 
Business Acquisition [Line Items]
 
 
 
Compensation
(6,000,000)
 
 
Sales and Marketing [Member] |
Correction
 
 
 
Business Acquisition [Line Items]
 
 
 
Compensation
$ (8,000,000)
 
 
Property, Plant and Equipment [Member] |
Minimum [Member]
 
 
 
Business Acquisition [Line Items]
 
 
 
Property, Equipment, and Depreciation, useful life, minimum
3 years 
 
 
Property, Plant and Equipment [Member] |
Maximum [Member]
 
 
 
Business Acquisition [Line Items]
 
 
 
Property, Equipment, and Depreciation, useful life, minimum
7 years 
 
 
Capitalized software [Member] |
Minimum [Member]
 
 
 
Business Acquisition [Line Items]
 
 
 
Property, Equipment, and Depreciation, useful life, minimum
3 years 
 
 
Capitalized software [Member] |
Maximum [Member]
 
 
 
Business Acquisition [Line Items]
 
 
 
Property, Equipment, and Depreciation, useful life, minimum
5 years 
 
 
Credit Arrangements (Details) (Revolving Credit Facility [Member], USD $)
In Millions, unless otherwise specified
1 Months Ended
Dec. 31, 2014
Jul. 31, 2014
Jul. 31, 2014
London Interbank Offered Rate (LIBOR) [Member]
Line of Credit Facility [Line Items]
 
 
 
Long-term Line of Credit
 
$ 75.0 
 
Line of Credit, Current
30.0 
 
 
Debt Instrument, Basis Spread on Variable Rate
 
 
100.00% 
Line of Credit Facility, Remaining Borrowing Capacity
$ 45.0 
 
 
Income Per Share (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Basic net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to Morningstar, Inc.
$ 31,514 
$ 30,180 
$ (9,769)
$ 26,376 
$ 31,327 
$ 31,463 
$ 31,121 
$ 29,618 
$ 78,301 
$ 123,529 
$ 108,079 
Less: Distributed earnings availabline to participating securities
 
 
 
 
 
 
 
 
(7)
(10)
(41)
Undistributed Earnings (Loss) Allocated to Participating Securities, Basic
 
 
 
 
 
 
 
 
36 
47 
Numerator for basic net income per share - undistributed and distributed earnings available to common shareholders
 
 
 
 
 
 
 
 
78,285 
123,483 
107,991 
Weighted average common shares outstanding
44,414 
44,734 
44,777 
44,777 
45,756 
46,080 
46,400 
46,406 
44,675 
46,158 
48,497 
Basic net income per share attributable to Morningstar, Inc.
 
 
 
 
 
 
 
 
$ 1.75 
$ 2.68 
$ 2.23 
Diluted net income per share attributable to Morningstar, Inc.:
 
 
 
 
 
 
 
 
 
 
 
Numerator for basic net income per share - undistributed and distributed earnings available to common shareholders
 
 
 
 
 
 
 
 
78,285 
123,483 
107,991 
Add: Undistributed earnings allocated to participating securities
 
 
 
 
 
 
 
 
36 
47 
Less: Undistributed earnings reallocated to participating securities
 
 
 
 
 
 
 
 
(9)
(36)
(46)
Numerator for diluted net income per share - undistributed and distributed earnings available to common shareholders
 
 
 
 
 
 
 
 
$ 78,285 
$ 123,483 
$ 107,992 
Weighted average common shares outstanding
44,414 
44,734 
44,777 
44,777 
45,756 
46,080 
46,400 
46,406 
44,675 
46,158 
48,497 
Net effect of dilutive stock options and restricted stock units
 
 
 
 
 
 
 
 
226 
333 
651 
Weighted average common shares outstanding for computing diluted income per share
44,548 
44,889 
44,777 
45,093 
46,211 
46,519 
46,853 
46,814 
44,901 
46,491 
49,148 
Diluted net income per share attributable to Morningstar, Inc.
 
 
 
 
 
 
 
 
$ 1.74 
$ 2.66 
$ 2.20 
Income (Loss) from Continuing Operations, Per Basic Share
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 1.75 
$ 2.68 
$ 2.12 
Income (Loss) from Discontinued Operations, Net of Tax, Per Basic Share
 
 
 
 
 
 
 
 
$ 0.00 
$ 0.00 
$ 0.11 
Income (Loss) from Continuing Operations, Per Diluted Share
$ 0.71 
$ 0.67 
$ (0.22)
$ 0.58 
$ 0.68 
$ 0.68 
$ 0.66 
$ 0.63 
$ 1.74 
$ 2.66 
$ 2.10 
Income (Loss) from Discontinued Operations, Net of Tax, Per Diluted Share
 
 
 
 
 
 
 
 
$ 0.00 
$ 0.00 
$ 0.10 
Income Per Share Income Per Share Antidilutive Shares (Details)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
53 
17 
90 
Stock Options [Member]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
83 
Restricted Stock Units (RSUs) [Member]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
47 
17 
Performance Shares [Member]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
Segment and Geographical Area Information (Operating Segments) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Segment Reporting Information, Operating Income (Loss) [Abstract]
 
 
 
 
 
 
 
 
 
 
 
External revenue
$ 196,415 
$ 193,106 
$ 189,385 
$ 181,165 
$ 180,500 
$ 173,482 
$ 175,428 
$ 168,856 
$ 760,071 
$ 698,266 
$ 658,288 
Stock-based compensation expense
 
 
 
 
 
 
 
 
17,624 
15,043 
18,905 
Depreciation and amortization
 
 
 
 
 
 
 
 
54,886 
45,693 
43,096 
Operating income
46,581 
45,261 
(24,780)
38,532 
41,897 
44,613 
43,584 
40,560 
105,594 
170,654 
150,668 
Segment Reporting Information, Additional Information [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Goodwill
370,054 
 
 
 
326,450 
 
 
 
370,054 
326,450 
320,845 
United States [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information, Operating Income (Loss) [Abstract]
 
 
 
 
 
 
 
 
 
 
 
External revenue
 
 
 
 
 
 
 
 
550,740 
500,730 
466,947 
Investment Management [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information, Operating Income (Loss) [Abstract]
 
 
 
 
 
 
 
 
 
 
 
External revenue
 
 
 
 
 
 
 
 
163,025 
142,624 
132,141 
Investment Information [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information, Operating Income (Loss) [Abstract]
 
 
 
 
 
 
 
 
 
 
 
External revenue
 
 
 
 
 
 
 
 
$ 597,046 
$ 555,642 
$ 526,147 
Segment and Geographical Area Information (External Revenue and Long-Lived Assets) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 196,415 
$ 193,106 
$ 189,385 
$ 181,165 
$ 180,500 
$ 173,482 
$ 175,428 
$ 168,856 
$ 760,071 
$ 698,266 
$ 658,288 
Long-lived assets
117,561 
 
 
 
104,986 
 
 
 
117,561 
104,986 
 
United States [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
550,740 
500,730 
466,947 
Long-lived assets
98,135 
 
 
 
84,321 
 
 
 
98,135 
84,321 
 
United Kingdom [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
61,844 
56,298 
56,794 
Long-lived assets
8,014 
 
 
 
6,873 
 
 
 
8,014 
6,873 
 
Europe excluding the United Kingdom [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
62,677 
57,580 
49,844 
Long-lived assets
2,102 
 
 
 
1,873 
 
 
 
2,102 
1,873 
 
Australia [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
34,977 
35,289 
38,229 
Long-lived assets
794 
 
 
 
1,051 
 
 
 
794 
1,051 
 
Canada [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
30,790 
31,845 
30,664 
Long-lived assets
938 
 
 
 
1,275 
 
 
 
938 
1,275 
 
Asia, Excluding Japan [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
15,830 
13,860 
13,765 
Long-lived assets
7,491 
 
 
 
9,479 
 
 
 
7,491 
9,479 
 
Other [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
3,213 
2,664 
2,045 
Long-lived assets
87 
 
 
 
114 
 
 
 
87 
114 
 
Non United States [Member]
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
209,331 
197,536 
191,341 
Long-lived assets
$ 19,426 
 
 
 
$ 20,665 
 
 
 
$ 19,426 
$ 20,665 
 
Investments and Fair Value Measurements (Classification of Securities) (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Fair Value Disclosures [Abstract]
 
 
Available-for-sale
$ 13,187 
$ 91,461 
Held-to-maturity
17,930 
31,214 
Trading securities, fair value disclosure
8,305 
7,732 
Total
$ 39,422 
$ 130,407 
Investments and Fair Value Measurements (Gains (Losses) on Investments) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
$ 12,648 
$ 90,560 
 
Available-for-sale securities, unrealized gain
928 
1,269 
 
Available-for-sale securities, unrealized loss
(389)
(368)
 
Available-for-sale securities, current
13,187 
91,461 
 
Held-to-maturity:
 
 
 
Held-to-maturity securities, total amortized cost
17,930 
31,214 
 
Held-to-maturity securities, unrealized gain
 
Held-to-maturity securities, unrealized loss
 
Held-to-maturity securities, current
17,930 
31,214 
 
Available-for-sale Securities, Gross Realized Gain (Loss) [Abstract]
 
 
 
Available-for-sale securities, realized gains
1,484 
5,550 
1,671 
Available-for-sale securities, realized losses
(466)
(1,343)
(1,133)
Available-for-sale securities, realized gains, net
1,018 
4,207 
538 
US Treasury and Government [Member]
 
 
 
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
19,693 
 
Available-for-sale securities, unrealized gain
 
Available-for-sale securities, unrealized loss
(3)
 
Available-for-sale securities, fair value disclosure
19,698 
 
Corporate Bonds [Member]
 
 
 
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
49,913 
 
Available-for-sale securities, unrealized gain
22 
 
Available-for-sale securities, unrealized loss
(124)
 
Available-for-sale securities, fair value disclosure
49,811 
 
Foreign obligations [Member]
 
 
 
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
505 
 
Available-for-sale securities, unrealized gain
 
Available-for-sale securities, unrealized loss
(2)
 
Available-for-sale securities, fair value disclosure
503 
 
Commercial paper [Member]
 
 
 
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
9,482 
 
Available-for-sale securities, unrealized gain
 
Available-for-sale securities, unrealized loss
 
Available-for-sale securities, fair value disclosure
9,489 
 
Equity securities and exchange-traded funds [Member]
 
 
 
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
11,428 
8,872 
 
Available-for-sale securities, unrealized gain
796 
1,011 
 
Available-for-sale securities, unrealized loss
(289)
(141)
 
Available-for-sale securities, fair value disclosure
11,935 
9,742 
 
Mutual funds [Member]
 
 
 
Available-for-sale:
 
 
 
Available-for-sale securities, amortized cost basis
1,220 
2,095 
 
Available-for-sale securities, unrealized gain
132 
221 
 
Available-for-sale securities, unrealized loss
(100)
(98)
 
Available-for-sale securities, fair value disclosure
$ 1,252 
$ 2,218 
 
Investments and Fair Value Measurements (Cost and Fair Value of Securities) (Details) (USD $)
Dec. 31, 2014
Dec. 31, 2013
Available-for-sale Securities, Debt Maturities [Abstract]
 
 
Available-for-sale securities, due in one year or less, amortized cost basis
$ 0 
$ 45,486,000 
Available-for-sale securities, due in one year or less, fair vlaue
45,402,000 
Available for sale securities, due in one to two years, amortized cost basis
34,107,000 
Available-for-sale securities, due in one to two years, fair value
34,099,000 
Available-for-sale securities, equity securities and mutual funds, amortized cost basis
12,648,000 
10,967,000 
Available-for-sale securities, equity securities and mutual funds, fair value
13,187,000 
11,960,000 
Available-for-sale securities, amortized cost basis
12,648,000 
90,560,000 
Available-for-sale securities, current
13,187,000 
91,461,000 
Held-to-maturity Securities, Debt Maturities [Abstract]
 
 
Held-to-maturity securities, due in one year, net carrying amount
17,929,000 
31,210,000 
Held-to-maturity securities, due within one year, fair value
17,929,000 
31,210,000 
Held-to-maturity securities, due in one to three years, net carrying amount
1,000 
4,000 
Held-to-maturity securities, due in one to three years, fair value
1,000 
4,000 
Held-to-maturity securities, total amortized cost
17,930,000 
31,214,000 
Held-to-maturity securities, current
17,930,000 
31,214,000 
Certificate of Deposit Held as Collateral Against Australia Office Lease
$ 1,500,000 
 
Investments and Fair Value Measurements (Unrealized Gains on Trading Securities) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Fair Value Disclosures [Abstract]
 
 
 
Unrealized gains (losses), net
$ (188)
$ 827 
$ 269 
Investments and Fair Value Measurements (Fair Value of Assets) (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Trading securities, fair value disclosure
$ 8,305 
$ 7,732 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Trading securities, fair value disclosure
8,305 
7,732 
Cash equivalents, fair value disclosure
512 
925 
Investments, fair value disclosure
22,004 
20,617 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member] |
Government obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member] |
Corporate bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member] |
Foreign obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member] |
Commercial paper [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member] |
Equity securities and exchange-traded funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
11,935 
9,742 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member] |
Mutual funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
1,252 
2,218 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Trading securities, fair value disclosure
Cash equivalents, fair value disclosure
Investments, fair value disclosure
79,501 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member] |
Government obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
19,698 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member] |
Corporate bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
49,811 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member] |
Foreign obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
503 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member] |
Commercial paper [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
9,489 
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member] |
Equity securities and exchange-traded funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member] |
Mutual funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Trading securities, fair value disclosure
Cash equivalents, fair value disclosure
Investments, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member] |
Government obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member] |
Corporate bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member] |
Foreign obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member] |
Commercial paper [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member] |
Equity securities and exchange-traded funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member] |
Mutual funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Trading securities, fair value disclosure
8,305 
7,732 
Cash equivalents, fair value disclosure
512 
925 
Investments, fair value disclosure
22,004 
100,118 
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member] |
Government obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
19,698 
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member] |
Corporate bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
49,811 
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member] |
Foreign obligations [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
503 
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member] |
Commercial paper [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
9,489 
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member] |
Equity securities and exchange-traded funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
11,935 
9,742 
Estimate of Fair Value Measurement [Member] |
Fair Value, Measurements, Recurring [Member] |
Mutual funds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale securities, fair value disclosure
$ 1,252 
$ 2,218 
Acquisitions, Goodwill, and Other Intangible Assets (Narrative) (Details) (USD $)
12 Months Ended 0 Months Ended 0 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Jun. 3, 2014
HelloWallet [Member]
Jun. 3, 2014
HelloWallet [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
May 3, 2013
Morningstar Sweden AB [Member]
Mar. 31, 2013
Morningstar Sweden AB [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
Intangible assets
 
 
 
 
$ 9,460,000 
$ 8,681,000 
$ 9,700,000 
 
Percentage of voting interests acquired
 
 
 
 
81.30% 
 
76.00% 
 
Business Combination, Consideration Transferred, Previously Held Ownership Portion
 
 
 
13,481,000 
 
 
 
 
Equity method investment, ownership percentage
 
 
 
 
 
 
100.00% 
24.00% 
Acquisition estimated fair value
 
 
 
 
54,006,000 
27,949,000 
18,513,000 
 
Cash paid to acquire the entity
 
 
 
40,525,000 
 
 
14,554,000 
 
Equity method investments, fair value
 
 
 
 
 
 
 
3,959,000 
Equity Method Investments Holding Gain
5,168,000 
3,635,000 
 
 
 
3,635,000 
 
Deferred tax liability
 
 
 
 
3,595,000 
3,299,000 
2,272,000 
 
Deferred tax asset
 
 
 
 
8,646,000 
3,987,000 
 
 
Goodwill
370,054,000 
326,450,000 
320,845,000 
 
39,166,000 
18,476,000 
8,911,000 
 
Goodwill, Impairment Loss
 
 
 
 
 
Impairment of intangible assets
 
 
 
 
 
Business Acquisition, Current Percentage of Voting Interests
 
 
 
 
100.00% 
 
 
 
Business Acquisition, Prior Percentage of Voting Interests
 
 
 
 
18.70% 
 
 
 
Business Combination, Non-Cash Holding Gain (Loss)
 
 
 
$ 5,168,000 
 
 
 
 
Acquisitions, Goodwill, and Other Intangible Assets (Purchase Price Allocation) (Details) (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Jun. 3, 2014
HelloWallet [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
May 3, 2013
Morningstar Sweden AB [Member]
Business Acquisition, Purchase Price Allocation [Abstract]
 
 
 
 
 
 
Cash and cash equivalents
 
 
 
$ 3,739 
$ 287 
$ 3,472 
Accounts receivable and other current assets
 
 
 
150 
152 
519 
Other non-current assets
 
 
 
318 
257 
244 
Deferred tax asset
 
 
 
8,646 
3,987 
 
Intangible assets
 
 
 
9,460 
8,681 
9,700 
Goodwill
370,054 
326,450 
320,845 
39,166 
18,476 
8,911 
Deferred revenue
 
 
 
(2,897)
(79)
(1,191)
Deferred tax liability
 
 
 
(3,595)
(3,299)
(2,272)
Other current and non-current liabilities
 
 
 
(981)
(513)
(870)
Acquisition estimated fair value
 
 
 
$ 54,006 
$ 27,949 
$ 18,513 
Acquisitions, Goodwill, and Other Intangible Assets (Allocation of Acquired Intangible Assets) (Details) (USD $)
In Thousands, unless otherwise specified
0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended
Jun. 3, 2014
HelloWallet [Member]
Jun. 3, 2014
HelloWallet [Member]
Jun. 3, 2014
HelloWallet [Member]
Technology-Based Intangible Assets [Member]
Jun. 3, 2014
HelloWallet [Member]
Technology-Based Intangible Assets [Member]
Jun. 3, 2014
HelloWallet [Member]
Trademarks and Trade Names [Member]
Jun. 3, 2014
HelloWallet [Member]
Trademarks and Trade Names [Member]
Jun. 3, 2014
HelloWallet [Member]
Noncompete Agreements [Member]
Jun. 3, 2014
HelloWallet [Member]
Noncompete Agreements [Member]
Apr. 1, 2014
ByAllAccounts, Inc. [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
Apr. 1, 2014
ByAllAccounts, Inc. [Member]
Customer-Related Intangible Assets [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
Customer-Related Intangible Assets [Member]
Apr. 1, 2014
ByAllAccounts, Inc. [Member]
Technology-Based Intangible Assets [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
Technology-Based Intangible Assets [Member]
Apr. 1, 2014
ByAllAccounts, Inc. [Member]
Trademarks and Trade Names [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
Trademarks and Trade Names [Member]
Apr. 1, 2014
ByAllAccounts, Inc. [Member]
Noncompete Agreements [Member]
Apr. 2, 2014
ByAllAccounts, Inc. [Member]
Noncompete Agreements [Member]
May 3, 2013
Morningstar Sweden AB [Member]
May 3, 2013
Morningstar Sweden AB [Member]
Customer-Related Assets [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Intangible assets
 
$ 9,460 
 
$ 6,670 
 
$ 169 
 
$ 2,621 
 
$ 8,681 
 
$ 5,506 
 
$ 3,020 
 
$ 47 
 
$ 108 
$ 9,700 
$ 9,700 
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life
5 years 
 
5 years 
 
3 years 
 
5 years 
 
19 years 
 
24 years 
 
4 years 6 months 
 
1 year 
 
3 years 
 
14 years 
14 years 
Acquisitions, Goodwill, and Other Intangible Assets (Schedule of Goodwill) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2013
Inquiry Financial Europe AB [Member]
Dec. 31, 2014
Morningstar Sweden AB [Member]
May 3, 2013
Morningstar Sweden AB [Member]
Goodwill [Roll Forward]
 
 
 
 
 
Goodwill, Beginning Balance
$ 326,450 
$ 320,845 
 
 
$ 8,911 
Adjustments to Acquisitions
 
 
8,911 
57,642 
 
Foreign currency translation
(14,038)
(3,306)
 
 
 
Goodwill, Ending Balance
$ 370,054 
$ 326,450 
 
 
$ 8,911 
Acquisitions, Goodwill, and Other Intangible Assets (Schedule of Intangible Assets) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
$ 263,918 
$ 253,700 
Accumulated Amortization
(168,013)
(149,791)
Net
95,905 
103,909 
Weighted Average Useful Life (years)
10 years 
10 years 
Intellectual Property [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
29,026 
29,477 
Accumulated Amortization
(25,033)
(23,128)
Net
3,993 
6,349 
Weighted Average Useful Life (years)
9 years 
9 years 
Customer-Related Assets [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
141,497 
141,833 
Accumulated Amortization
(83,582)
(74,311)
Net
57,915 
67,522 
Weighted Average Useful Life (years)
12 years 
12 years 
Supplier Relationships [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
240 
240 
Accumulated Amortization
(120)
(108)
Net
120 
132 
Weighted Average Useful Life (years)
20 years 
20 years 
Technology-Based Assets [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
88,816 
80,489 
Accumulated Amortization
(57,395)
(50,673)
Net
31,421 
29,816 
Weighted Average Useful Life (years)
8 years 
9 years 
Non-Competition Agreement [Member]
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
4,339 
1,661 
Accumulated Amortization
(1,883)
(1,571)
Net
$ 2,456 
$ 90 
Weighted Average Useful Life (years)
5 years 
4 years 
Acquisitions, Goodwill, and Other Intangible Assets (Amortization Expense) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Acquisitions, Goodwill, and Other Intangible Assets [Abstract]
 
 
 
Amortization expense
$ 22,264 
$ 21,454 
$ 23,944 
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
 
 
 
2015
21,920 
 
 
2016
17,394 
 
 
2017
12,941 
 
 
2018
10,790 
 
 
2019
8,046 
 
 
Thereafter
$ 24,814 
 
 
Discontinued Operations (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax
$ 0 
$ 0 
$ 6,193 
Discontinued Operation, Tax Effect of Discontinued Operation
1,005 
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax
$ 0 
$ 0 
$ 5,188 
Investments in Unconsolidated Entities (Details)
In Thousands, unless otherwise specified
12 Months Ended 0 Months Ended
Dec. 31, 2014
USD ($)
Dec. 31, 2013
USD ($)
Dec. 31, 2012
USD ($)
Dec. 31, 2014
Other Equity Method Investments [Member]
USD ($)
Dec. 31, 2013
Other Equity Method Investments [Member]
USD ($)
Dec. 31, 2014
YCharts [Member]
Dec. 31, 2013
YCharts [Member]
Dec. 31, 2014
Morningstar Japan KK [Member]
USD ($)
Dec. 31, 2014
Morningstar Japan KK [Member]
JPY (¥)
Dec. 31, 2013
Morningstar Japan KK [Member]
USD ($)
Dec. 31, 2013
Morningstar Japan KK [Member]
JPY (¥)
Dec. 31, 2014
Inquiry Financial Europe AB [Member]
Dec. 31, 2013
Inquiry Financial Europe AB [Member]
May 3, 2013
Morningstar Sweden AB [Member]
USD ($)
Mar. 31, 2013
Morningstar Sweden AB [Member]
Schedule of Equity Method Investments [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity method investments
 
 
 
$ 3,475 
$ 6,166 
 
 
$ 23,014 
 
$ 21,782 
 
 
 
 
 
Cost method investments
2,309 
10,766 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total investments in unconsolidated entities
28,798 
38,714 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity method investment, ownership percentage
 
 
 
 
 
22.00% 
22.00% 
34.00% 
34.00% 
34.00% 
34.00% 
34.00% 
34.00% 
100.00% 
24.00% 
Holding gain upon acquisition of additional ownership of equity method investment
(5,168)
(3,635)
 
 
 
 
 
 
 
 
 
 
(3,635)
 
Percentage of voting interests acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
76.00% 
 
Equity method investment, approximate market value
 
 
 
 
 
 
 
61,277 
7,347,413 
94,999 
9,824,068 
 
 
 
 
Cost-method investments, other than temporary impairment
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity Method Investment, Other than Temporary Impairment
1,683 
 
 
 
 
 
 
 
 
 
 
 
 
 
Payments to Acquire Other Investments
2,751 
10,304 
 
 
 
 
 
 
 
 
 
 
 
 
Cost-method Investments, Realized Gain (Loss)
$ 353 
$ 0 
$ (2,034)
 
 
 
 
 
 
 
 
 
 
 
 
Property, Equipment, and Capitalized Software (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
$ 250,494 
$ 211,152 
 
Less accumulated depreciation
(132,933)
(106,166)
 
Property, equipment, and capitalized software, net
117,561 
104,986 
 
Capitalized software development costs not yet placed into service
18,070 
11,345 
 
Depreciation expense
32,622 
24,239 
19,152 
Computer equipment [Member]
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
53,420 
47,830 
 
Capitalized software [Member]
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
87,764 
50,360 
 
Furniture and fixtures [Member]
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
23,172 
23,259 
 
Leasehold improvements [Member]
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
54,320 
52,512 
 
Telephone equipment [Member]
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
1,948 
2,032 
 
Construction in progress [Member]
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, equipment, and capitalized software, at cost
$ 29,870 
$ 35,159 
 
Operating Leases Operating Leases (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
 
 
 
2012
$ 19,395 
 
 
2013
20,299 
 
 
2014
19,270 
 
 
2015
16,916 
 
 
2016
12,632 
 
 
Thereafter
48,203 
 
 
Total
136,715 
 
 
Rent expense
24,460 
22,169 
20,736 
Deferred rent
$ 29,124 
$ 26,157 
 
Stock-Based Compensation (Narrative) (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended 1 Months Ended 12 Months Ended 1 Months Ended
Dec. 31, 2014
Dec. 31, 2014
Stock Options [Member]
Dec. 31, 2014
Restricted Stock [Member]
Dec. 31, 2014
Restricted Stock Units (RSUs) [Member]
May 31, 2011
2004 Stock Incentive Plan [Member]
Dec. 31, 2011
2004 Stock Incentive Plan [Member]
Nov. 30, 2011
2011 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
Unrecognized stock-based compensation expense
$ 33,808 
$ 162 
$ 129 
$ 33,064 
 
 
 
Expected amortization period (months)
32 years 
6 years 
4 years 
32 years 
 
 
 
Stock option granted
 
 
 
 
86,106 
 
6,095 
Fair value per share
 
 
 
 
 
$ 23.81 
 
Stock-Based Compensation (Shares Available for Future Grants) (Details)
In Thousands, unless otherwise specified
Dec. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
 
Shares available for future grants
4,233 
Stock-Based Compensation (Allocation of Stock-Based Compensation Costs) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Allocated Share-based Compensation Expense
$ 17,624 
$ 15,043 
$ 18,905 
Income tax benefit related to the stock-based compensation expense
5,055 
4,027 
3,686 
Restricted Stock Units (RSUs) [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Allocated Share-based Compensation Expense
16,307 
14,163 
13,451 
Restricted Stock [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Allocated Share-based Compensation Expense
388 
388 
5,013 
Performance Shares [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Allocated Share-based Compensation Expense
505 
Stock Options [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Allocated Share-based Compensation Expense
$ 424 
$ 492 
$ 441 
Stock-Based Compensation (Unrecognized Stock-Based Compensation Expense) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Income tax benefit related to the stock-based compensation expense
$ 33,808 
Expected amortization period (months)
32 years 
Restricted Stock Units (RSUs) [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Income tax benefit related to the stock-based compensation expense
33,064 
Expected amortization period (months)
32 years 
Restricted Stock [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Income tax benefit related to the stock-based compensation expense
129 
Expected amortization period (months)
4 years 
Performance Shares [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Income tax benefit related to the stock-based compensation expense
453 
Expected amortization period (months)
24 years 
Stock Options [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Income tax benefit related to the stock-based compensation expense
$ 162 
Expected amortization period (months)
6 years 
Stock-Based Compensation (Restricted Stock Units Activity) (Details) (Restricted Stock Units (RSUs) [Member], USD $)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Restricted Stock Units (RSUs) [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
 
 
RSUs Outstanding, Beginning Balance, Unvested
680,002 
727,145 
741,043 
RSUs Outstanding, Beginning Balance, Vested but Deferred
16,682 
18,782 
20,076 
RSUs Outstanding, Beginning Balance
696,684 
745,927 
761,119 
RSUs Outstanding, Beginning Balance, Weighted Average Grant Date Value per RSU
$ 62.02 
$ 53.37 
$ 50.66 
Granted, Unvested
279,524 
287,848 
341,282 
Granted, Vested but Deferred
Granted
279,524 
287,848 
341,282 
Granted, Weighted Average Grant Date Value per RSU
$ 72.68 
$ 72.04 
$ 56.26 
Dividend equivalents, Unvested
2,621 
2,773 
6,405 
Dividends equivalents, Vested but Deferred
150 
157 
130 
Dividends equivalents
2,771 
2,930 
6,535 
Dividends equivalents, Weighted Average Grant Date Value per RSU
$ 55.70 
$ 57.39 
$ 52.02 
Vested, Unvested
(268,115)
(278,549)
(270,695)
Vested, Vested but Deferred
Vested
(268,115)
(278,549)
(270,695)
Vested, Weighted Average Grant Date Value per RSU
$ 58.91 
$ 50.41 
$ 50.12 
Vested but Deferred, Unvested
 
 
(892)
Vested but Deferred, Vested but Deferred
 
 
892 
Vested but Deferred
 
 
Vested but Deferred, Weighted Average Grant Date Value per RSU
 
 
$ 0.00 
Issued, Unvested
Issued, Vested but Deferred
(2,054)
(2,257)
(2,316)
Issued
(2,054)
(2,257)
(2,316)
Issued, Weighted Average Grant Date Value per RSU
$ 53.54 
$ 49.40 
$ 73.28 
Forfeited, Unvested
(38,098)
(59,215)
(89,998)
Forfeited, Vested but Deferred
Forfeited
(38,098)
(59,215)
(89,998)
Forfeited, Weighted Average Grant Date Value per RSU
$ 65.21 
$ 57.58 
$ 50.84 
RSUs Outstanding, Ending Balance, Unvested
655,934 
680,002 
727,145 
RSUs Outstanding, Ending Balance, Vested but Deferred
14,778 
16,682 
18,782 
RSUs Outstanding, Ending Balance
670,712 
696,684 
745,927 
RSUs Outstanding, Ending Balance, Weighted Average Grant Date Value per RSU
$ 67.51 
$ 62.02 
$ 53.37 
Stock-Based Compensation (Assumptions for Black-Scholes Option Pricing Model) (Details) (Employee Stock Option [Member])
12 Months Ended
Dec. 31, 2011
Employee Stock Option [Member]
 
Assumptions for Black-Scholes Option Pricing Model [Line Items]
 
Expected life (years):
7 years 4 months 24 days 
Volatility factor:
35.10% 
Dividends yield:
0.35% 
Interest rate:
2.87% 
Stock-Based Compensation (Stock Option Activity) (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2009
Option Exercise Price Grouping [Member]
 
 
 
 
Intrinsic Value of Options Exercised [Abstract]
 
 
 
 
Intrinsic value of options exercised
$ 12,021 
$ 12,801 
$ 22,526 
 
Options Granted At Discount [Member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
 
 
 
 
Beginning Balance, Options, Outstanding, Underlying Shares
179,559 
282,695 
398,859 
 
Granted, Underlying Shares
 
Canceled, Underlying Shares
(150)
(250)
(650)
 
Exercised, Underlying Shares
(179,409)
(102,886)
(115,514)
 
Ending Balance, Options, Outstanding, Underlying Shares
179,559 
282,695 
 
Options, Weighted Average Exercise Price [Abstract]
 
 
 
 
Beginning Balance, Options, Outstanding, Weighted Average Exercise Price
$ 21.47 
$ 20.55 
$ 19.72 
 
Granted, Weighted Average Exercise Price
$ 0.00 
$ 0.00 
$ 0.00 
 
Canceled, Weighted Average Exercise Price
$ 22.24 
$ 21.48 
$ 14.70 
 
Exercised, Weighted Average Exercise Price
$ 22.08 
$ 21.09 
$ 20.19 
 
Ending Balance, Options, Outstanding, Weighted Average Exercise Price
$ 0.00 
$ 21.47 
$ 20.55 
 
Options, Exercisable, Number of Shares and Weighted Average Exercise Price [Abstract]
 
 
 
 
Options exercisable - end of year, Underlying Shares
179,559 
 
282,695 
Options exercisable - end of year, Weighted Average Exercise Price
$ 0.00 
$ 21.47 
 
$ 20.55 
Option Grants Excluding Options Granted At Discount [Member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
 
 
 
 
Beginning Balance, Options, Outstanding, Underlying Shares
253,972 
391,784 
818,552 
 
Granted, Underlying Shares
 
Canceled, Underlying Shares
(526)
(1,352)
(22,330)
 
Exercised, Underlying Shares
(83,636)
(136,460)
(404,438)
 
Ending Balance, Options, Outstanding, Underlying Shares
169,810 
253,972 
391,784 
 
Options, Weighted Average Exercise Price [Abstract]
 
 
 
 
Beginning Balance, Options, Outstanding, Weighted Average Exercise Price
$ 36.48 
$ 28.98 
$ 22.76 
 
Granted, Weighted Average Exercise Price
$ 0.00 
$ 0.00 
$ 0.00 
 
Canceled, Weighted Average Exercise Price
$ 38.61 
$ 16.19 
$ 39.75 
 
Exercised, Weighted Average Exercise Price
$ 30.82 
$ 16.84 
$ 16.60 
 
Ending Balance, Options, Outstanding, Weighted Average Exercise Price
$ 40.20 
$ 36.48 
$ 28.98 
 
Options, Exercisable, Number of Shares and Weighted Average Exercise Price [Abstract]
 
 
 
 
Options exercisable - end of year, Underlying Shares
154,864 
219,449 
337,684 
 
Options exercisable - end of year, Weighted Average Exercise Price
$ 38.53 
$ 33.18 
$ 24.42 
 
Stock-Based Compensation (Additional Information on Options) (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Closing Stock Price Used to Calculate Intrinsic Value
$ 64.71 
Range One [Member]
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Range of Exercise Prices
$27.54 
Exercise price range, lower range limit
$ 27.54 
Exercise price range, upper range limit
$ 27.54 
Options Outstanding, Number of Options
96,354 
Options Outstanding, Weighted Average Remaining Contractual Life (years)
0 years 4 months 2 days 
Options Outstanding, Weighted Average Exercise Price
$ 27.54 
Options Outstanding, Aggregate Intrinsic Value
$ 3,582 
Options Exercisable, Exercisable Shares
96,354 
Options Exercisable, Weighted Average Remaining Contractual Life (years)
0 years 4 months 2 days 
Options Exercisable, Weighted Average Exercise Price
$ 27.54 
Options Exercisable, Aggregate Intrinsic Value
3,582 
Range Two [Member]
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Range of Exercise Prices
$40.49 - $51.03 
Exercise price range, lower range limit
$ 40.49 
Exercise price range, upper range limit
$ 51.03 
Options Outstanding, Number of Options
5,781 
Options Outstanding, Weighted Average Remaining Contractual Life (years)
0 years 10 months 28 days 
Options Outstanding, Weighted Average Exercise Price
$ 49.10 
Options Outstanding, Aggregate Intrinsic Value
90 
Options Exercisable, Exercisable Shares
5,781 
Options Exercisable, Weighted Average Remaining Contractual Life (years)
0 years 10 months 28 days 
Options Exercisable, Weighted Average Exercise Price
$ 49.10 
Options Exercisable, Aggregate Intrinsic Value
90 
Range Three [Member]
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Range of Exercise Prices
$57.28 - $59.35 
Exercise price range, lower range limit
$ 57.28 
Exercise price range, upper range limit
$ 59.35 
Options Outstanding, Number of Options
67,675 
Options Outstanding, Weighted Average Remaining Contractual Life (years)
6 years 6 months 4 days 
Options Outstanding, Weighted Average Exercise Price
$ 57.47 
Options Outstanding, Aggregate Intrinsic Value
490 
Options Exercisable, Exercisable Shares
52,729 
Options Exercisable, Weighted Average Remaining Contractual Life (years)
6 years 6 months 4 days 
Options Exercisable, Weighted Average Exercise Price
$ 57.46 
Options Exercisable, Aggregate Intrinsic Value
358 
Range Four [Member]
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Range of Exercise Prices
$27.54 - $59.35 
Exercise price range, lower range limit
$ 27.54 
Exercise price range, upper range limit
$ 59.35 
Options Outstanding, Number of Options
169,810 
Options Outstanding, Weighted Average Remaining Contractual Life (years)
2 years 9 months 26 days 
Options Outstanding, Weighted Average Exercise Price
$ 40.20 
Options Outstanding, Aggregate Intrinsic Value
4,162 
Options Exercisable, Exercisable Shares
154,864 
Options Exercisable, Weighted Average Remaining Contractual Life (years)
2 years 5 months 16 days 
Options Exercisable, Weighted Average Exercise Price
$ 38.53 
Options Exercisable, Aggregate Intrinsic Value
4,030 
Vested or Expected to Vest [Member]
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
 
Exercise price range, lower range limit
$ 27.54 
Exercise price range, upper range limit
$ 59.35 
Share Based Compensation, Arrangement By Share Based Payments, Vested or Expected to Vest, Range of Exercise Prices
$27.54 - $59.35 
Option Outstanding, Number of Options, Vested or Expected to Vest
169,810 
Options Outstanding, Weighted Average Remaining Contractual Life (years), Vested or Expected to vest
2 years 9 months 26 days 
Options Outstanding, Weighted Average Exercise Price, Vested or Expected to Vest
$ 40.20 
Options Outstanding, Average Intrinsic Value, Vested or Expected to Vest
$ 4,162 
Stock-Based Compensation Stock-Based Compensation (Total Stock-Based Compensation Expense) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
$ 17,624 
$ 15,043 
$ 18,905 
Cost of Revenue [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
7,774 
6,870 
6,416 
Selling and Marketing Expense [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
2,170 
1,975 
1,937 
General and Administrative Expense [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
 
 
 
Allocated Share-based Compensation Expense
$ 7,680 
$ 6,198 
$ 10,552 
Stock-Based Compensation Stock-Based Compensation (Performance Shares) (Details) (Performance Shares [Member], USD $)
12 Months Ended
Dec. 31, 2014
Performance Shares [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Granted, Unvested
23,685 
Granted, Weighted Average Grant Date Value per RSU
$ 80.91 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Shares Issued Based Upon Current Performance Levels
11,842.5 
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options
$ 453,000 
Defined Contribution Plan (Details) (USD $)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Defined Contribution Plan [Abstract]
 
 
 
401(k) matching contributions
$ 7,451,000 
$ 6,879,000 
$ 6,642,000 
Matching contribution to 401(k) for every dollar
$ 0.75 
$ 0.75 
$ 0.75 
Matching contribution percent to employee's contribution in pay period
7.00% 
7.00% 
7.00% 
Income Taxes (Schedule of Income Tax Expense and Effective Tax Rate) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Tax Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Income before income taxes and equity in net income of unconsolidated entities
$ 48,420 
$ 44,963 
$ (18,882)
$ 39,397 
$ 44,426 
$ 45,384 
$ 46,695 
$ 41,505 
$ 113,898 
$ 178,010 
$ 153,625 
Equity in net income of unconsolidated entities
(1,394)
337 
497 
599 
256 
315 
360 
497 
39 
1,428 
2,027 
Net (income) loss attributable to the noncontrolling interest
(22)
29 
30 
29 
29 
21 
43 
42 
122 
117 
Income loss from continuing operations before income taxes domestic and foreign
 
 
 
 
 
 
 
 
113,979 
179,560 
155,769 
Income tax expense
$ 15,490 
$ 15,149 
$ (8,611)
$ 13,650 
$ 13,384 
$ 14,265 
$ 15,955 
$ 12,427 
$ 35,678 
$ 56,031 
$ 52,878 
Effective income tax rate
 
 
 
 
 
 
 
 
31.30% 
31.20% 
33.90% 
Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Tax Examination [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Income tax expense at U.S. federal rate
 
 
 
 
 
 
 
 
$ 39,893 
$ 62,845 
$ 54,519 
Income tax expense at U.S. federal rate, percent
 
 
 
 
 
 
 
 
35.00% 
35.00% 
35.00% 
State income taxes, net of frderal income tax benefit
 
 
 
 
 
 
 
 
2,129 
3,029 
1,510 
State income taxes, net of frderal income tax benefit, percent
 
 
 
 
 
 
 
 
1.90% 
1.70% 
1.00% 
Effective Income Tax Rate Reconciliation, Equity in Earnings (Losses) of Unconsolidated Subsidiary, Amount
 
 
 
 
 
 
 
 
(1,397)
Effective Income Tax Rate Reconciliation, Equity in Earnings (Losses) of Unconsolidated Subsidiary, Percent
 
 
 
 
 
 
 
 
(1.20%)
0.00% 
0.00% 
Net change in valuation allowance related to non-U.S. deffered tax assets, primarily net operating losses
 
 
 
 
 
 
 
 
(600)
(1,842)
(630)
Net change in valuation allowance related to non-U.S. deffered tax assets, primarily net operating losses, percent
 
 
 
 
 
 
 
 
(0.50%)
(1.00%)
(0.40%)
Difference between U.S. federal statutory and foreign tax rates
 
 
 
 
 
 
 
 
(3,961)
(2,513)
(2,777)
Difference between U.S. federal statutory and foreign tax rates, percent
 
 
 
 
 
 
 
 
(3.50%)
(1.40%)
(1.80%)
Change in unrecognized tax benefits
 
 
 
 
 
 
 
 
1,481 
(211)
967 
Changes in unrecognized tax benefits, percent
 
 
 
 
 
 
 
 
1.30% 
(0.10%)
0.60% 
Other tax credits
 
 
 
 
 
 
 
 
(2,924)
(4,374)
(1,494)
Other tax credits, percent
 
 
 
 
 
 
 
 
(2.60%)
(2.50%)
(1.00%)
Recognition of deferred tax assets
 
 
 
 
 
 
 
 
(140)
(1,448)
Recognition of deferred tax assets, percent
 
 
 
 
 
 
 
 
(0.10%)
(0.80%)
0.00% 
Other - net
 
 
 
 
 
 
 
 
1,197 
545 
783 
Other - net, percent
 
 
 
 
 
 
 
 
1.00% 
0.30% 
0.50% 
Income tax expense
$ 15,490 
$ 15,149 
$ (8,611)
$ 13,650 
$ 13,384 
$ 14,265 
$ 15,955 
$ 12,427 
$ 35,678 
$ 56,031 
$ 52,878 
Incomr tax expense, percent
 
 
 
 
 
 
 
 
31.30% 
31.20% 
33.90% 
Income Taxes (Schedule of Components of Income Tax Expense) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Tax Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Federal
 
 
 
 
 
 
 
 
$ 20,726 
$ 42,808 
$ 38,821 
State
 
 
 
 
 
 
 
 
1,996 
3,882 
1,997 
Non-U.S.
 
 
 
 
 
 
 
 
9,638 
10,456 
5,719 
Current tax expense
 
 
 
 
 
 
 
 
32,360 
57,146 
46,537 
Federal
 
 
 
 
 
 
 
 
3,668 
2,630 
6,287 
State
 
 
 
 
 
 
 
 
1,326 
814 
334 
Non-U.S.
 
 
 
 
 
 
 
 
(1,676)
(4,559)
(280)
Deferred tax expense (benefit)
 
 
 
 
 
 
 
 
3,318 
(1,115)
6,341 
Income tax expense
$ 15,490 
$ 15,149 
$ (8,611)
$ 13,650 
$ 13,384 
$ 14,265 
$ 15,955 
$ 12,427 
$ 35,678 
$ 56,031 
$ 52,878 
Income Taxes (Schedule of Income before Income Taxes and Equity in Net Income of Unconsolidated Entities) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Tax Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
U.S.
 
 
 
 
 
 
 
 
$ 80,394 
$ 144,065 
$ 128,920 
Non-U.S.
 
 
 
 
 
 
 
 
33,504 
33,945 
24,705 
Income before income taxes and equity in net income of unconsolidated entities
$ 48,420 
$ 44,963 
$ (18,882)
$ 39,397 
$ 44,426 
$ 45,384 
$ 46,695 
$ 41,505 
$ 113,898 
$ 178,010 
$ 153,625 
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Deferred tax assets:
 
 
Stock-based compensation expense
$ 3,262 
$ 3,479 
Accrued liabilities
13,632 
9,805 
Net operating loss carryforwards - U.S.
10,505 
851 
Net operating loss carryforwards - Non-U.S.
7,725 
9,229 
Deferred royalty revenue
354 
366 
Allowance for doubtful accounts
929 
758 
Deferred rent
10,019 
8,673 
Total deferred tax assets
46,426 
33,161 
Deferred tax liabilities:
 
 
Acquired intangible assets
(16,419)
(12,967)
Property, equipment and capitalized software
(23,157)
(15,525)
Unrealized exchange gains, net
(174)
(395)
Prepaid expenses
(3,677)
(4,299)
Investments in unconsolidated entities
(12,836)
(12,009)
Other
(435)
(373)
Total deferred tax liabilities
(56,698)
(45,568)
Net deferred tax liability before valuation allowance
10,272 
12,407 
Valuation allowance
(6,706)
(7,456)
Net deferred tax liability
$ (16,978)
$ (19,863)
Income Taxes (Schedule of Deferred Tax Assets and Liabilities Included in Consolidated Balance Sheets) (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Income Tax Disclosure [Abstract]
 
 
Deferred tax assets, net - current
$ 9,000 
$ 3,892 
Deferred tax liabilities, net - noncurrent
(25,978)
(23,755)
Net deferred tax liability
$ (16,978)
$ (19,863)
Income Taxes (Summary of Operating Loss Carryforward- U.S and Non-U.S) (Details) (USD $)
12 Months Ended
Dec. 31, 2013
Dec. 31, 2014
Operating Loss Carryforwards [Line Items]
 
 
Undistributed earnings of foreigh subsidiaries, permanently invested
 
$ 118,600,000 
Non-U.S. [Member]
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating loss carryforwards
45,368,000 
37,868,000 
Operating loss carryforwards, not subject to valuation allowances
8,759,000 
5,127,000 
Non-U.S. [Member] |
Subject to Expiration Date [Member]
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating loss carryforwards
5,314,000 
5,240,000 
Non-U.S. [Member] |
No Expiration Date [Member]
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating loss carryforwards
40,054,000 
32,628,000 
U.S [Member] |
Subject to Expiration Date [Member]
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating loss carryforwards
$ 2,136,000 
$ 30,015,000 
Operating loss carryforwards, expiration dates
Dec. 31, 2023 
 
Income Taxes (Accounting for Uncertainty in Tax Positions) (Details) (USD $)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Income Tax Disclosure [Abstract]
 
 
Gross unrecognized tax benefits - beginning of the year
$ 12,958,000 
$ 12,699,000 
Increases as a resulting of tax positions taken during a prior-year period
866,000 
791,000 
Decreases as a resulting of tax positions taked during a prior-year period
(54,000)
(146,000)
Increases as a result of tax positions taken during the current period
2,007,000 
2,887,000 
Unrecognized Tax Benefits, Decreases Resulting from Settlements with Taxing Authorities
(2,400,000)
(2,779,000)
Decrease of unrecognized tax benefits relating to settlements with tax authorities
1,455,000 
 
Reductions as a result of lapse of the applicable statute of limitations
(1,455,000)
(494,000)
Gross unrecognized tax benefits - end of the year
11,922,000 
12,958,000 
Unrecognized tax benefits included in current liabilities
5,124,000 
 
Unrecognized tax benefits included in non-current liabilities
6,608,000 
 
Result of tax position taken during period
2,818,000 
 
Increase in income tax expense
2,572,000 
 
Reductions resulting from settlements and lapse of statute of limitations
3,855,000 
 
Unrecognized tax benefits that would impact effective tax rate
11,922,000 
 
Unrecognized tax benefits, period increase (decrease)
2,818,000 
 
Reductions resulting from settlements and lapse statute of limitations, tax effect
1,269,000 
 
Decrease in income tax expense upon recognition of gross unrecognized tax benefits
$ 10,565,000 
 
Income Taxes (Summary of Income Tax Examinations) (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Income Tax Disclosure [Abstract]
 
 
Liabilities for interest and penalties
$ 1,488 
$ 1,865 
Share Repurchase Program (Details) (USD $)
Dec. 31, 2014
Equity [Abstract]
 
Shares repurchased, program life to date, shares
8,142,010 
Shares repurchased, program life to date, value
$ 526,500,000.0 
Stock repurchase program, authorized amount
700,000,000 
Stock Repurchase Program, Remaining Authorized Repurchase Amount
$ 173,500,000 
Subsequent Events (Details)
3 Months Ended 12 Months Ended 1 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Feb. 28, 2015
Subsequent Event [Member]
Subsequent Event [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Dividends declared per common share
$ 0.190 
$ 0.170 
$ 0.170 
$ 0.170 
$ 0.295 
$ 0.000 
$ 0.125 
$ 0.125 
$ 0.700 
$ 0.545 
$ 0.425 
$ 0.19 
Selected Quarterly Financial Data (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Quarterly Financial Information Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 196,415 
$ 193,106 
$ 189,385 
$ 181,165 
$ 180,500 
$ 173,482 
$ 175,428 
$ 168,856 
$ 760,071 
$ 698,266 
$ 658,288 
Total operating expense
149,834 
147,845 
214,165 
142,633 
138,603 
128,869 
131,844 
128,296 
654,477 
527,612 
507,620 
Operating income
46,581 
45,261 
(24,780)
38,532 
41,897 
44,613 
43,584 
40,560 
105,594 
170,654 
150,668 
Non-operating income (expense), net
1,839 
(298)
5,898 
865 
2,529 
771 
3,111 
945 
8,304 
7,356 
2,957 
Income before income taxes and equity in net income of unconsolidated entities
48,420 
44,963 
(18,882)
39,397 
44,426 
45,384 
46,695 
41,505 
113,898 
178,010 
153,625 
Equity in net income (loss) of unconsolidated entities
(1,394)
337 
497 
599 
256 
315 
360 
497 
39 
1,428 
2,027 
Income tax expense
15,490 
15,149 
(8,611)
13,650 
13,384 
14,265 
15,955 
12,427 
35,678 
56,031 
52,878 
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest
31,536 
30,151 
(9,774)
26,346 
31,298 
31,434 
31,100 
29,575 
78,259 
123,407 
102,774 
Consolidated net income
 
 
 
 
 
 
 
 
78,259 
123,407 
107,962 
Net (income) loss attributable to the noncontrolling interest
(22)
29 
30 
29 
29 
21 
43 
42 
122 
117 
Net income attributable to Morningstar, Inc.
$ 31,514 
$ 30,180 
$ (9,769)
$ 26,376 
$ 31,327 
$ 31,463 
$ 31,121 
$ 29,618 
$ 78,301 
$ 123,529 
$ 108,079 
Income (Loss) from Continuing Operations, Per Basic Share
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 0 
$ 1.75 
$ 2.68 
$ 2.12 
Earnings Per Share, Basic [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Basic net income per share attributable to Morningstar, Inc.
 
 
 
 
 
 
 
 
$ 1.75 
$ 2.68 
$ 2.23 
Weighted average common shares outstanding - basic
44,414 
44,734 
44,777 
44,777 
45,756 
46,080 
46,400 
46,406 
44,675 
46,158 
48,497 
Income (Loss) from Continuing Operations, Per Diluted Share
$ 0.71 
$ 0.67 
$ (0.22)
$ 0.58 
$ 0.68 
$ 0.68 
$ 0.66 
$ 0.63 
$ 1.74 
$ 2.66 
$ 2.10 
Earnings Per Share, Diluted [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Diluted net income per share attributable to Morningstar, Inc.
 
 
 
 
 
 
 
 
$ 1.74 
$ 2.66 
$ 2.20 
Weighted average common shares outstanding - diluted
44,548 
44,889 
44,777 
45,093 
46,211 
46,519 
46,853 
46,814 
44,901 
46,491 
49,148 
Dividends Per Common Share: [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Common stock, dividends, per share, declared
$ 0.190 
$ 0.170 
$ 0.170 
$ 0.170 
$ 0.295 
$ 0.000 
$ 0.125 
$ 0.125 
$ 0.700 
$ 0.545 
$ 0.425 
Dividends paid per common share
$ 0.170 
$ 0.170 
$ 0.170 
$ 0.170 
$ 0.125 
$ 0.125 
$ 0.125 
$ 0.000 
$ 0.680 
$ 0.375 
$ 0.525