Table of Contents WEWORK COMPANIES INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2018 minimum rental payments for its operating leases totaled $34.0 billion, as disclosed in Note 23. The Company expects the majority of these operating leases will be impacted by ASU 2016-02, resulting in increases in lease liabilities and right of use assets based on the present value of future lease payments. The Company expects to continue entering into new lease arrangements in the ordinary course of business. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which was codified primarily as Accounting Standards Codification No. 606 (“ASC 606”). ASC 606 supersedes existing revenue recognition guidance and clarifies the principles for recognizing revenue. The core principle of ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those products and services. Since issuance in May 2014, the FASB has issued several amendments to ASC 606 including implementation guidance which clarifies principal versus agent considerations in reporting revenue gross versus net, clarification of the identification and treatment for performance obligations and guidance on collectability, noncash consideration and various other accounting and presentation matters. ASC 606, as amended, is effective for public business entities for annual reporting periods beginning after December 15, 2017, and interim reporting periods within those annual reporting periods and is effective for all other entities for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019, with early adoption permitted. ASC 606 should be applied either retrospectively to each prior reporting period presented or on a modified retrospective basis with the cumulative effect of initially applying ASC 606 recognized at the date of initial application. The Company will adopt ASU 2014-09 as of January 1, 2019 using the modified retrospective approach with a cumulative effect adjustment to opening retained earnings. The Company does not expect the adoption of ASU 2014-09 will have a material impact on the timing of recognition for the majority of the Company’s revenues, including membership revenue. Note 3. Other Current Assets Other current assets consists of the following: December 31, (Amounts in thousands) 2017 2018 Net receivable for value added tax (“VAT”) $ 33,230 $ 92,815 Deposits on property and equipment 53,337 81,646 (1) Acquisition deposit 77,800 — Prepaid rent expense 46,400 71,357 Prepaid real estate taxes 6,695 14,293 Prepaid common area maintenance charges 4,587 7,075 Prepaid member referral fees 9,086 49,735 Prepaid software 3,253 13,546 Other prepaid expenses and current assets 17,342 55,134 Total other current assets $ 251,730 $ 385,601 (1) During 2017, the Company entered into an agreement for the acquisition of a commercial real estate portfolio located in London, United Kingdom (“DSQ”) and funded approximately $77.8 million for a non-refundable deposit. Subsequent to December 31, 2017, the Company entered into a joint venture (“DSQ Partners”) established to own, operate and manage the DSQ real estate portfolio upon the closing of the acquisition. DSQ Partners closed on the acquisition of DSQ in April 2018 and the Company received a reimbursement of approximately $25.0 million, which represented the difference between the deposit funded and the Company’s 10% share of the capital requirements of DSQ Partners. See Note 9 for additional details. F-25