NDAQNasdaq, Inc.

You state that you are in the process of evaluating the impact that the amended revenue recognition guidance in Topic 606 will have on your consolidated financial statements. Please provide additional qualitative financial statement disclosures in future filings of the potential impact that this standard will have on your financial statements when adopted.

Rest of the question

In this regard, include a description of the effects of the accounting policies that you expect to apply, if determined, and a comparison to your current revenue recognition policies. Describe the status of your process to implement the new standard and the significant implementation matters yet to be addressed. In addition, to the extent that you determine the quantitative impact that adoption of Topic 606 is expected to have on your financial statements, please also disclose such amounts. Please refer to ASC 250-10-S996 and SAB Topic 11.M.

Our Form 10-K for the year ended December 31, 2016 included disclosure regarding the impact of the adoption of Topic 606 to the extent such impact had been determined at the time of the filing. As we determine further qualitative and quantitative details regarding the expected impact of the adoption, we will include disclosure of these items in our future filings.

Rest of the answer

Below is an example of the disclosure we will include in our Form 10-Q for the quarter ended March 31, 2017.

We are currently assessing the materiality of the expected impact that the adoption of Topic 606 will have on our consolidated financial statements. We reviewed customer contracts for all of our businesses and have determined that revenue and expense recognition for our Market Technology business and revenue recognition for our Listing Services business will be impacted. We do not anticipate material changes to revenue and expense recognition for our other businesses.

The following are key items to note regarding the accounting for our Market Technology and Listing Services businesses under Topic 606:

• revenue recognition for existing and new contracts will be in earlier stages under the new standard;

expense recognition for Market Technology contracts will be in earlier stages under the new standard;

a portion of revenues and expenses that were previously deferred will be recognized either in prior period revenues, through restatement, or as an adjustment to retained earnings upon adoption of the new standard; and the overall value of contracts and the timing of cash flows from customers will not change.

We have reviewed substantially all of the existing customer contracts in our Market Technology and Listing Services businesses and we are currently quantifying the impact of adopting the new standard under both the retrospective and modified approaches. As part of this analysis, we are calculating the cumulative adjustment to retained earnings under both approaches and expect to select a transition approach once we have completed this analysis. In addition, we are gathering the required information to be disclosed for all businesses.

Market Technology. In our Market Technology business, we enter into contracts with customers to develop technology solutions, license the right to use software, and provide post-contract support and other services to our customers. Under current accounting policies, we do not recognize revenue or expense until we begin the final stage of the contract as we are not able to establish vendor specific objective evidence of fair value for individual elements of the contract. Under Topic 606, we will no longer defer recognition of revenue and expense until the final stage of the contract. For each of our contracts, we expect to identify multiple performance obligations, allocate the transaction price to these obligations and recognize revenue for each of these obligations as they are satisfied. Expenses will no longer be deferred, but will be recognized as incurred. Since revenue and expense will be recognized in earlier stages of the contract, the balance sheet accounts for deferred revenue and costs will decline upon adoption of Topic 606. Due to the complexity of certain contracts, the revenue recognition treatment under the new standard will be dependent on contract-specific terms and may vary in some instances.

Listing

Services. Amounts received for initial listing fees and additional listing fees are generally deferred and recognized over estimated service periods of six and four years, respectively. Under Topic 606, we will identify the performance obligation associated with these services and record revenue upon satisfaction of each performance obligation. We expect to recognize both initial listing fees and additional listing fees over shorter periods than the current estimated service periods. Since we expect to recognize revenues earlier under Topic 606, the balance sheet account for deferred revenue will decline upon adoption.

During the remainder of 2017, we will quantify the impact of adoption and implement any required changes to our systems and processes to meet the new accounting, reporting and disclosure requirements and will update our internal controls accordingly. We will also review any new contracts entered into throughout the year. We do not believe there are any significant barriers to implementation of the new standard.

* * *

If you have any further questions or concerns, please feel free to contact me at (212) 401-8730.

Read in the reply ↗

We note your adjustment related to amortization of intangible assets and that this adjustment has been made to prior periods when presenting your non-gaap income and operating income performance measures. Please clarify how management’s view of operating performance has changed compared to prior periods.

In the first quarter of 2015, Nasdaq began excluding the amortization of acquired intangible assets when evaluating the performance of our businesses and its managers and when allocating resources amongst the businesses. Our non-GAAP and operating income metrics are used internally and by our investors to measure the ongoing operating performance of the Company. Management’s view of operating performance has not changed significantly from prior periods.

Rest of the answer

However, intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from the Company’s ongoing business operations. As such, if intangible asset amortization is included in performance measures, it is more difficult to assess the day-to-day operating performance of the businesses, the relative operating performance of the businesses between periods, and the earnings power of the Company. In connection with this change to the calculation of our internal performance measures in the first quarter of 2015, we also aligned our external reporting with these same performance measures. Historical periods were restated to conform to the current presentation. Performance measures excluding intangible asset amortization therefore, provide investors with a more useful representation of our businesses’ activity in each period.

Read in the reply ↗

Please tell us the amount of unrecognized deferred tax liability on unremitted earnings, if practicable, and disclose the amount in future filings. Reference is made to ASC 740-3050-2c.

It is not practicable to determine the amount of the unrecognized deferred tax liability on indefinitely reinvested unremitted earnings. For purposes of illustration, the following is an example of the disclosure that the Company will include in its future 10-K filings.

“We have determined that undistributed earnings of certain non-U.S. subsidiaries will be reinvested for an indefinite period of time. We have both the intent and ability to indefinitely reinvest these earnings.

Rest of the answer

At December 31, 2015, the cumulative amount of undistributed earnings in these subsidiaries is approximately $121 million. Given our intent to reinvest these earnings for an indefinite period of time, we have not accrued a deferred tax liability for U.S. federal income taxes on these earnings. A determination of unrecognized deferred tax liability related to these earnings is not practicable.”

* * *

As requested by the Staff, the Company acknowledges the following.

• The Company is responsible for the adequacy and accuracy of the disclosure in the filing;

• Staff comments or changes to disclosure in response to Staff comments do not foreclose the Commission from taking any action with respect to the filing; and

• The Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

If you have any further questions or concerns, please feel free to contact me at (212) 401-8726.

Read in the reply ↗

We note your response to our prior comment one. Please include disclosure in future filings that describes the adjustments made to previously reported Non-GAAP measures, the reasons for such adjustments and why the revised measure disclosed represents a more useful presentation of the Company’s operating performance.

In future filings where there have been adjustments to previously reported non-GAAP measures, we will expand our disclosure to include a more detailed description of the adjustments made to previously reported non-GAAP measures, the reasons for such adjustments and why the revised measure disclosed represents a more useful presentation of our ongoing operating performance.

Rest of the answer

For purposes of illustration, the following is an example of the disclosure that the Company will include in its 2016 Form 10-K:

In the first quarter of 2015, Nasdaq began excluding the amortization of acquired intangible assets when evaluating the performance of our businesses and its managers and when allocating resources amongst the businesses. Our non-GAAP and operating income metrics are used internally and by our investors to measure the ongoing operating performance of the Company. Management’s view of operating performance has not changed significantly from prior periods. However, intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from the Company’s ongoing business operations. As such, if intangible asset amortization is included in performance measures, it is more difficult to assess the day-to-day operating performance of the businesses, the relative operating performance of the businesses between periods, and the earnings power of the Company. In connection with this change to the calculation of our internal performance measures in the first quarter of 2015, we also aligned our external reporting with these same performance measures. Historical periods were restated to conform to the current presentation. Performance measures excluding intangible asset amortization therefore, provide investors with a more useful representation of our businesses’ ongoing activity in each period.

* * *

As requested by the Staff, the Company acknowledges the following.

•

The Company is responsible for the adequacy and accuracy of the disclosure in the filing;

Staff comments or changes to disclosure in response to Staff comments do not foreclose the Commission from taking any action with respect to the filing; and

The Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

If you have any further questions or concerns, please feel free to contact me at (212) 401-8726.

Read in the reply ↗