Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The number of shares outstanding of our common stock as of September ~~4, 2018~~3, 2019 was ~~56,940,561~~55,975,840 shares.

	July 31, 2018			April 30, 2018			July 31, 2019			April 30, 2019
	(unaudited)						(unaudited)
	(in thousands, except per share data)						(in thousands, except per share data)
ASSETS
Cash and cash equivalents	$	365,729		$	520,848		$	424,637		$	626,360
Marketable securities		10,952			14,293			8,508			8,288
Receivables due from clients, net of allowance for doubtful accounts of $19,201 and $17,845 at July 31, 2018 and April 30, 2018, respectively		397,559			384,996
Receivables due from clients, net of allowance for doubtful accounts of $21,732 and $21,582 at July 31, 2019 and April 30, 2019, respectively								432,758			404,857
Income taxes and other receivables		36,999			29,089			30,529			26,767
Unearned compensation		40,713			37,333			45,380			42,003
Prepaid expenses and other assets		32,056			27,700			33,311			28,535
Total current assets		884,008			1,014,259			975,123			1,136,810

Marketable securities, non-current		123,124			122,792			134,148			132,463
Property and equipment, net		123,318			119,901			137,367			131,505
Cash surrender value of company owned life insurance policies, net of loans		121,828			120,087
Operating lease right-of-use assets, net								219,412			—
Cash surrender value of company-owned life insurance policies, net of loans								126,752			126,000
Deferred income taxes		39,512			25,520			41,191			43,220
Goodwill		581,858			584,222			578,567			578,298
Intangible assets, net		93,050			203,216			79,581			82,948
Unearned compensation, non-current		92,378			78,295			92,365			80,924
Investments and other assets		20,394			19,622			22,052			22,684
Total assets	$	2,079,470		$	2,287,914		$	2,406,558		$	2,334,852
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	35,325		$	35,196		$	33,174		$	39,156
Income taxes payable		25,790			23,034			19,199			21,145
Compensation and benefits payable		175,477			304,980			156,208			328,610
Term loan		26,629			24,911
Operating lease liability, current								46,854			—
Other accrued liabilities		150,534			170,339			156,218			162,047
Total current liabilities		413,755			558,460			411,653			550,958

Deferred compensation and other retirement plans		234,468			227,729			269,380			257,635
Term loan, non-current		204,654			211,311
Operating lease liability, non-current								207,603			—
Long-term debt								223,094			222,878
Deferred tax liabilities		1,609			9,105			1,048			1,103
Other liabilities		60,364			61,694			29,386			58,891
Total liabilities		914,850			1,068,299			1,142,164			1,091,465

Stockholders' equity
Common stock: $0.01 par value, 150,000 shares authorized, 72,171 and 71,631 shares issued at July 31, 2018 and April 30, 2018, respectively, and 56,938 and 56,517 shares outstanding at July 31, 2018 and April 30, 2018, respectively		681,060			683,942
Common stock: $0.01 par value, 150,000 shares authorized, 73,076 and 72,442 shares issued and 56,596 and 56,431 shares outstanding at July 31, 2019 and April 30, 2019, respectively								645,299			656,463
Retained earnings		537,015			572,800			697,715			660,845
Accumulated other comprehensive loss, net		(56,488	)		(40,135	)		(82,114	)		(76,652	)
Total Korn/Ferry International stockholders' equity		1,161,587			1,216,607
Total Korn Ferry stockholders' equity								1,260,900			1,240,656
Noncontrolling interest		3,033			3,008			3,494			2,731
Total stockholders' equity		1,164,620			1,219,615			1,264,394			1,243,387
Total liabilities and stockholders' equity	$	2,079,470		$	2,287,914		$	2,406,558		$	2,334,852

The accompanying notes are an integral part of these consolidated financial statements.

	Three Months Ended July 31,						Three Months Ended July 31,
	2018			2017			2019			2018
	(in thousands, except per share data)						(in thousands, except per share data)
Fee revenue	$	465,568		$	401,254		$	484,549		$	465,568
Reimbursed out-of-pocket engagement expenses		12,794			13,663			11,649			12,794
Total revenue		478,362			414,917			496,198			478,362

Compensation and benefits		321,905			272,756			328,496			321,905
General and administrative expenses		168,724			58,261			65,807			168,724
Reimbursed expenses		12,794			13,663			11,649			12,794
Cost of services		18,327			15,813			17,135			18,327
Depreciation and amortization		11,731			12,209			12,777			11,731
Restructuring charges, net		—			280
Total operating expenses		533,481			372,982			435,864			533,481

Operating (loss) income		(55,119	)		41,935
Operating income (loss)								60,334			(55,119	)
Other income, net		4,491			3,354			1,826			4,520
Interest expense, net		(4,103	)		(3,680	)		(4,057	)		(4,103	)
(Loss) income before (benefit) provision for income taxes and equity in earnings of unconsolidated subsidiaries		(54,731	)		41,609
Equity in earnings of unconsolidated subsidiaries		29			30
Income tax (benefit) provision		(16,110	)		12,210
Net (loss) income		(38,592	)		29,429
Income (loss) before provision (benefit) for income taxes								58,103			(54,702	)
Income tax provision (benefit)								14,453			(16,110	)
Net income (loss)								43,650			(38,592	)
Net income attributable to noncontrolling interest		(19	)		(388	)		(699	)		(19	)
Net (loss) income attributable to Korn/Ferry International	$	(38,611	)	$	29,041
Net income (loss) attributable to Korn Ferry							$	42,951		$	(38,611	)

(Loss) earnings per common share attributable to Korn/Ferry International:
Earnings (loss) per common share attributable to Korn Ferry:
Basic	$	(0.70	)	$	0.52		$	0.77		$	(0.70	)
Diluted	$	(0.70	)	$	0.51		$	0.76		$	(0.70	)

Weighted-average common shares outstanding:
Basic		55,378			55,795			55,266			55,378
Diluted		55,378			56,403			55,635			55,378

Cash dividends declared per share:	$	0.10		$	0.10		$	0.10		$	0.10

The accompanying notes are an integral part of these consolidated financial statements.

Accumulated

Total

Other

Korn/Ferry

Comprehensive

International

Total

Common Stock

Retained

(Loss) Income,

Stockholders'

Noncontrolling

Stockholder's

Shares

Amount

Earnings

Net

Equity

Interest

Equity

(in thousands)

Balance as of April 30, 2018

56,517

$
683,942

$
572,800

$
(40,135
)

$
1,216,607

$
3,008

$
1,219,615

Net loss

—

—

(38,611
)

—

(38,611
)

19

(38,592
)
Other Comprehensive (loss) income

—

—

—

(14,156
)

(14,156
)

6

(14,150
)
Effect of adopting new accounting standards

—

—

8,853

(2,197
)

6,656

—

6,656

Dividends paid to shareholders

—

—

(6,027
)

—

(6,027
)

—

(6,027
)
Purchase of stock

(200
)

(13,055
)

—

—

(13,055
)

—

(13,055
)
Issuance of stock

621

4,804

—

—

4,804

—

4,804

Stock-based compensation

—

5,369

—

—

5,369

—

5,369

Balance as of July 31, 2018

56,938

$
681,060

$
537,015

$
(56,488
)

$
1,161,587

$
3,033

$
1,164,620

										Accumulated Other			Total
										Comprehensive			Korn Ferry					Total
	Common Stock						Retained			Loss,			Stockholders'			Noncontrolling		Stockholder's
	Shares			Amount			Earnings			Net			Equity			Interest		Equity
	(in thousands)
Balance as of April 30, 2019		56,431		$	656,463		$	660,845		$	(76,652	)	$	1,240,656		$	2,731	$	1,243,387
Net income		—			—			42,951			—			42,951			699		43,650
Other comprehensive (loss) income		—			—			—			(5,462	)		(5,462	)		64		(5,398	)
Dividends paid to shareholders		—			—			(6,081	)		—			(6,081	)		—		(6,081	)
Purchase of stock		(546	)		(21,329	)		—			—			(21,329	)		—		(21,329	)
Issuance of stock		711			5,074			—			—			5,074			—		5,074
Stock-based compensation		—			5,091			—			—			5,091			—		5,091
Balance as of July 31, 2019		56,596		$	645,299		$	697,715		$	(82,114	)	$	1,260,900		$	3,494	$	1,264,394

										Accumulated Other			Total
										Comprehensive			Korn Ferry					Total
	Common Stock						Retained			Loss,			Stockholders'			Noncontrolling		Stockholder's
	Shares			Amount			Earnings			Net			Equity			Interest		Equity
	(in thousands)
Balance as of April 30, 2018		56,517		$	683,942		$	572,800		$	(40,135	)	$	1,216,607		$	3,008	$	1,219,615
Net loss		—			—			(38,611	)		—			(38,611	)		19		(38,592	)
Other comprehensive (loss) income		—			—			—			(14,156	)		(14,156	)		6		(14,150	)
Effect of adopting new accounting standards		—			—			8,853			(2,197	)		6,656			—		6,656
Dividends paid to shareholders		—			—			(6,027	)		—			(6,027	)		—		(6,027	)
Purchase of stock		(200	)		(13,054	)		—			—			(13,054	)		—		(13,054	)
Issuance of stock		621			4,803			—			—			4,803			—		4,803
Stock-based compensation		—			5,369			—			—			5,369			—		5,369
Balance as of July 31, 2018		56,938		$	681,060		$	537,015		$	(56,488	)	$	1,161,587		$	3,033	$	1,164,620

Accumulated

Total

Other

Korn/Ferry

Comprehensive

International

Total

Common Stock

Retained

(Loss) Income,

Stockholders'

Noncontrolling

Stockholder's

Shares

Amount

Earnings

Net

Equity

Interest

Equity

(in thousands)

Balance as of April 30, 2017

56,938

$
692,527

$
461,976

$
(71,064
)

$
1,083,439

$
3,609

$
1,087,048

Net income

—

—

29,041

—

29,041

388

29,429

Other Comprehensive income

—

—

—

16,373

16,373

105

16,478

Dividends paid to shareholders

—

—

(5,823
)

—

(5,823
)

—

(5,823
)
Purchase of stock

(217
)

(7,372
)

—

—

(7,372
)

—

(7,372
)
Issuance of stock

525

4,586

—

—

4,586

—

4,586

Stock-based compensation

—

4,405

—

—

4,405

—

4,405

Balance as of July 31, 2017

57,246

$
694,146

$
485,194

$
(54,691
)

$
1,124,649

$
4,102

$
1,128,751

The accompanying notes are an integral part of these consolidated financial statements.

	Three Months Ended July 31,						Three Months Ended July 31,
	2018			2017			2019			2018
	(in thousands)						(in thousands)
Cash flows from operating activities:
Net (loss) income	$	(38,592	)	$	29,429
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Net income (loss)							$	43,650		$	(38,592	)
Adjustments to reconcile net income (loss) to net cash used by operating activities:
Depreciation and amortization		11,731			12,209			12,777			11,731
Stock-based compensation expense		5,714			4,696			5,462			5,714
Tradename write-offs		106,555			—			—			106,555
Provision for doubtful accounts		3,707			3,070			3,549			3,707
Gain on cash surrender value of life insurance policies		(1,347	)		(2,485	)		(2,338	)		(1,347	)
Gain on marketable securities		(4,001	)		(3,429	)		(1,945	)		(4,001	)
Deferred income taxes		(22,564	)		8,562			1,974			(22,564	)
Change in other assets and liabilities:
Deferred compensation		3,021			8,288			11,652			3,021
Receivables due from clients		(16,270	)		(23,413	)		(31,450	)		(16,270	)
Income taxes and other receivables		(7,811	)		(10,930	)		(3,176	)		(7,811	)
Prepaid expenses and other assets		(4,356	)		(4,780	)		(9,845	)		(4,356	)
Unearned compensation		(17,463	)		(29,115	)		(14,818	)		(17,463	)
Investment in unconsolidated subsidiaries		(29	)		(30	)
Income taxes payable		1,434			6,463			(1,911	)		1,434
Accounts payable and accrued liabilities		(135,405	)		(109,034	)		(175,709	)		(135,405	)
Other		(1,816	)		926			209			(1,845	)
Net cash used in operating activities		(117,492	)		(109,573	)
Net cash used by operating activities								(161,919	)		(117,492	)
Cash flows from investing activities:
Purchase of property and equipment		(13,163	)		(9,529	)		(10,706	)		(13,163	)
Purchase of marketable securities		(1,396	)		(4,600	)		(1,600	)		(1,396	)
Proceeds from sales/maturities of marketable securities		8,240			1,734			1,599			8,240
Premium on company-owned life insurance policies		(398	)		(403	)		(341	)		(398	)
Proceeds from life insurance policies		85			971			1,673			85
Dividends received from unconsolidated subsidiaries		—			60			166			—
Net cash used in investing activities		(6,632	)		(11,767	)		(9,209	)		(6,632	)
Cash flows from financing activities:
Principal payments on term loan facility		(5,156	)		(5,156	)
Payment of contingent consideration from acquisitions		(455	)		(485	)
Repurchases of common stock		—			(4,026	)		(12,738	)		—
Payments of tax withholdings on restricted stock		(13,054	)		(3,346	)		(8,591	)		(13,054	)
Proceeds from issuance of common stock upon exercise of employee stock options and in connection with an employee stock purchase plan		4,105			3,984			4,313			4,105
Payments on life insurance policy loans								(943	)		—
Principal payments on finance leases								(432	)		—
Dividends paid to shareholders		(6,027	)		(5,823	)		(6,081	)		(6,027	)
Payments on life insurance policy loans		—			(414	)
Principal payments on term loan								—			(5,156	)
Payment of contingent consideration from acquisitions								(455	)		(455	)
Net cash used in financing activities		(20,587	)		(15,266	)		(24,927	)		(20,587	)
Effect of exchange rate changes on cash and cash equivalents		(10,408	)		7,743			(5,668	)		(10,408	)
Net decrease in cash and cash equivalents		(155,119	)		(128,863	)		(201,723	)		(155,119	)
Cash and cash equivalents at beginning of period		520,848			410,882			626,360			520,848
Cash and cash equivalents at end of the period	$	365,729		$	282,019		$	424,637		$	365,729

The accompanying notes are an integral part of these consolidated financial statements.

~~Korn/~~Korn Ferry, ~~International,~~ a Delaware corporation (the “Company”), and its subsidiaries ~~are engaged~~currently operate through 3 global segments: Korn Ferry Advisory (“Advisory”), Executive Search and Korn Ferry RPO and Professional Search (“RPO & Professional Search”). Advisory assists clients to synchronize strategy and talent by addressing four fundamental needs: Organizational Strategy, Assessment and Succession, Leadership Development, and Rewards and Benefits, all underpinned by a comprehensive array of one of the world-leading intellectual property (“IP”), products and tools. Executive Search focuses on recruiting board level, chief executive and other senior executive and general management positions, in addition to research-based interviewing and assessment solutions, for clients predominantly in the ~~business of providing executive searches on a retained basis, advisory solutions~~consumer goods, financial services, industrial, life sciences/healthcare and products, recruitment for non-executive professionals and recruitment process outsourcing (“RPO”). On June 12, 2018, the Company’s Board of Directors approved a plan (the “Plan”) to go to market under a single, master brand architecture and to simplify the Company’s organizational structure by eliminating and/or consolidating certain legal entities and implementing a rebranding of the Company to offer the Company’s current products and services using the “Korn Ferry” name, branding and trademarks. In connection with the Plan, the Company intends to sunset all sub-brands, including Futurestep, Hay Group and Lominger, among others. The Company is harmonizing under one brand to help accelerate the firm’s positioning as the preeminent organizational consultancy and bring more client awareness to its broad range of talent management solutions. While the rebranding will not impact the Company’s segment financial reporting, the Company renamed its Hay Group segment as “Advisory” and its Futurestep segment as “RPOtechnology industries. RPO & Professional ~~Search.” The Company’s Executive~~ Search ~~segment remains unchanged.~~uses data-backed insight and IP, matched with strategic collaboration and innovative technology, to meet people challenges head-on—and succeed. Solutions span all aspects of Recruitment Process Outsourcing (“RPO”), Professional Search and Project Recruitment.

The accompanying financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended April 30, ~~2018~~2019 for the Company and its wholly and majority owned/controlled domestic and international subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The preparation of the consolidated financial statements conform with United States (“U.S.”) generally accepted accounting principles (“GAAP”) and prevailing practice within the industry. The consolidated financial statements include all adjustments, consisting of normal recurring accruals and any other adjustments that management considers necessary for a fair presentation of the results for these periods. The results of operations for the interim period are not necessarily indicative of the results for the entire fiscal year.

Investments in affiliated companies, which are 50% or less owned and where the Company exercises significant influence over operations, are accounted for using the equity method.

The Company has control of a Mexico subsidiary and consolidates the operations of this subsidiary. Noncontrolling interest, which represents the ~~Company’s~~Mexico Partners’ 51% ~~noncontrolling~~ interest in the Mexico subsidiary, is reflected on the Company’s consolidated financial statements.

The Company considers events or transactions that occur after the balance sheet date but before the consolidated financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosures.

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates, and changes in estimates are reported in current operations as new information is learned or upon the amounts becoming fixed ~~and~~or determinable. The most significant areas that require ~~management~~management’s judgment are revenue recognition, deferred compensation, annual ~~performance related~~performance-related bonuses, evaluation of the carrying value of receivables, goodwill and other intangible assets, share-based payments, leases, and the recoverability of deferred income taxes.

Revenue is recognized when control of the goods and services are transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods and services. Revenue contracts with customers are evaluated based on the five-step model outlined in Accounting Standard Codification 606 (“ASC 606”): 1) identify the contract with a customer; 2) identify the performance obligation(s) in the contract; 3) determine the transaction price; 4) allocate the transaction price to the separate performance obligation(s); and 5) recognize revenue when (or as) each performance obligation is satisfied.

Consulting fee revenue, primarily generated from Advisory, is recognized as services are rendered, measured by total hours incurred to the total estimated hours at completion. It is possible that updated estimates for consulting engagements may vary from initial estimates with such updates being recognized in the period of determination. Depending on the timing of billings and services rendered, the Company accrues or defers revenue as appropriate.

Product revenue is generated from a range of online tools designed to support human resource processes for pay, talent and engagement, and assessments, as well as licenses to proprietary IP and tangible/digital products. IPsubscriptions grant access to proprietary compensation and job evaluation databases. IP subscriptions are considered symbolic IP due to the dynamic nature of the content and, as a result, revenue is recognized over the term of the contract.Functional IP licenses grant customers the right to use IP content via delivery of a flat file. Because the IP content license has significant stand-alone functionality, revenue is recognized upon delivery and when an enforceable right to payment exists.Online assessments are delivered in the form of online questionnaires.A bundle of assessments represents one performance obligation, and revenue is recognized as assessment services are delivered and the Company has a legally enforceable right to payment. Tangible/digital products sold by the Company mainly consist of books and digital files covering a variety of topics including performance management, team effectiveness, and coaching and development. The Company recognizes revenue for its products when sold or shipped, as is the case for books.

Fee revenue from executive and ~~non-executive~~ professional search activities is generally one-third of the estimated ~~first year~~first-year cash compensation of the placed candidate, plus a percentage of the fee to cover indirect ~~engagement related~~engagement-related expenses. In addition to the search retainer, an uptick fee is billed when the actual compensation awarded by the client for a placement is higher

than the estimated compensation. In the aggregate, upticks ~~are~~have been a relatively consistent percentage of the original estimated ~~fee~~fee; therefore, the Company estimates upticks using the expected value method based on historical data on a portfolio basis. In a standard search engagement, there is one performance obligation, which is the promise to undertake a search. The Company generally recognizes such revenue over the course of a search and when it is legally entitled to payment as outlined in the billing terms of the contract. Any revenues associated with services that are provided on a contingent basis are recognized once the contingency is resolved, as this is when control is transferred to the customer. These assumptions determine the timing of revenue recognition for the reported period.

RPO feerevenue is generated through two distinct ~~phases~~phases: 1) the implementation phase and 2) the post-implementation recruitment phase. The fees associated with the implementation phase are recognized over the period that the related implementation services are provided. The post-implementation recruitment phase represents end-to-end recruiting services to clients for which there are both fixed and variable fees, which are recognized over the period that the related recruiting services are performed.

Product revenue is generated from a range of online tools designed to support human resource processes for pay, talent and engagement, assessments, as well as licenses to proprietary intellectual property (“IP”) and tangible/digital products. IP subscriptions grant access to proprietary compensation and job evaluation databases. IP subscriptions are considered symbolic IP due to the dynamic nature of the content and, as a result, revenue is recognized over the term of the contract. Functional IP licenses grant customers the right to use IP content via delivery of a flat file. Because the IP content license has significant standalone functionality, revenue is recognized upon delivery and when an enforceable right to payment exists.~~Online assessments are delivered in the form of online questionnaires.A bundle of assessments represents one performance obligation, and revenue is recognized as assessment services are delivered and the Company has a legally enforceable right to payment.~~ Tangible/Digital products sold by the Company mainly consist of books and digital files covering a variety of topics including performance management, team effectiveness, and coaching and development. The Company recognizes revenue for its products when sold or shipped, as is the case for books.

The Company incurs certain out-of-pocket expenses that are reimbursed by its clients, which are accounted for as revenue in ~~its~~the consolidated statements of operations.

An allowance is established for doubtful accounts by taking a charge to general and administrative expenses. The amount of the allowance is based on historical loss experience and assessment of the collectability of specific accounts, as well as expectations of future collections based upon trends and the type of work for which services are rendered. After the Company exhausts all collection efforts, the amount of the allowance is reduced for balances identified as uncollectible.

The Company considers all highly liquid investments with original maturities of three months or less from the date of purchase to be cash equivalents. As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, the Company’s investments in cash equivalents ~~consist~~consisted of money market funds for which market prices are readily available.

The Company currently has investments in mutual funds that are classified as trading securities based upon management’s intent and ability to hold, sell or trade such securities. The classification of the investments in mutual funds is assessed upon purchase and reassessed at each reporting period. The investments in mutual funds (for which market prices are readily available) that are held in trust to satisfy obligations under the Company’s deferred compensation plans. Such investments are based upon the employees’ investment elections in their deemed accounts in the Executive Capital Accumulation Plan and similar plans in Asia Pacific and Canada (“ECAP”) from a pre-determined set of securities, and the Company invests in marketable securities to mirror these elections. These investments are recorded at fair value with the change in value in the period being reflected in the consolidated statements of operations and are classified as marketable securities in the accompanying consolidated balance sheets. The investments that the Company may sell within the next twelve months are carried as current assets. Realized gains (losses) on marketable securities are determined by specific identification. Interest is recognized on an accrual basis; dividends are recorded as earned on the ex-dividend date. Interest, dividend income and the changes in fair value in ~~trading~~marketable securities are recorded in the accompanying consolidated statements of operations in other income, net.

Fair value is the price the Company would receive to sell an asset or transfer a liability (exit price) in an orderly transaction between market participants. For those assets and liabilities recorded or disclosed at fair value, the Company determines the fair value based upon the quoted market price, if available. If a quoted market price is not available for identical assets, the fair value is based upon the quoted market price of similar assets. The fair values are assigned a level within the fair value hierarchy as defined below:

As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, the Company held certain assets that are required to be measured at fair value on a recurring basis. These included cash, cash equivalents, accounts receivable, marketable securities, foreign currency forward contracts and an interest rate swap. The carrying amount of cash, cash equivalents and accounts receivable approximates fair value due to the ~~short~~short-term maturity of these instruments. The fair values of marketable securities ~~classified as trading~~ are obtained from quoted market prices, and the fair values of foreign currency forward contracts and the interest rate swap are obtained from a third party, which are based on quoted prices or market prices for similar assets and financial instruments.

~~The Company is exposed to interest rate risk due to the outstanding senior secured credit agreement entered on June 15, 2016.~~ The Company has entered into an interest rate swap agreement to effectively convert its variable debt to a fixed-rate basis. The principal objective of these contracts is to eliminate or reduce the variability of the cash flows in interest payments associated with the Company’s long-term debt, thus reducing the impact of interest rate changes on future interest payment cash flows. The Company has determined that the interest rate swap qualifies as a cash flow hedge in accordance with Accounting Standards Codification 815, Derivatives and Hedging(“ASC 815”). Changes in the fair value of an interest rate swap agreement designated as a cash flow hedge are recorded as a component of accumulated other comprehensive (loss) income within stockholders’ equity and are amortized to interest expense over the term of the related debt.

The Company has established a program that primarily utilizes foreign currency forward contracts to offset the risks associated with the effects of certain foreign currency exposures primarily originating from intercompany balances due to cross border work performed in the ordinary course of business. These foreign currency forward contracts are neither used for trading purposes nor are they designated as hedging instruments pursuant to ~~Accounting Standards Codification 815,~~ ~~Derivatives and Hedging~~.ASC 815. Accordingly, the fair value of these contracts is recorded as of the end of the reporting period in the accompanying consolidated balance sheets, while the change in fair value is recorded to the accompanying consolidated statements of operations.

Business acquisitions are accounted for under the acquisition method. The acquisition method requires the reporting entity to identify the acquirer, determine the acquisition date, recognize and measure the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity, and recognize and measure goodwill or a gain from the purchase. The acquiree’s results are included in the Company’s consolidated financial statements from the date of acquisition. Assets acquired and liabilities assumed are recorded at their fair values and the excess of the purchase price over the amounts assigned is recorded as goodwill, or if the fair value of the assets acquired exceeds the purchase price consideration, a bargain purchase gain is recorded. Adjustments to fair value assessments are generally recorded to goodwill over the measurement period (not longer than twelve months). The acquisition method also requires that acquisition-related transaction and post-acquisition restructuring costs be charged to expense as committed and requires the Company to recognize and measure certain assets and liabilities including those arising from contingencies and contingent consideration in a business combination.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of use (“ROU”) assets and current and non-current operating lease liability, in the consolidated balance sheets. Finance leases are included in property and equipment, net, other accrued liabilities and other liabilities in the consolidated balance sheets.

ROU assets represent the Company's right to use an underlying asset for the lease term, and the lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term, with variable lease payments recognized in the periods in which they are incurred.

The Company has lease agreements with lease and non-lease components. For all leases with non-lease components the Company accounts for the lease and non-lease components as a single lease component.

Goodwill represents the excess of the purchase price over the fair value of assets acquired. The goodwill impairment test compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, goodwill of the reporting unit would be considered impaired. To measure the amount of the impairment loss, the implied fair value of a reporting unit’s goodwill is compared to the carrying amount of that goodwill. The

implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. If the carrying amount of a reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. For each of these tests, the fair value of each of the Company’s reporting units is determined using a combination of valuation techniques, including a discounted cash flow methodology. To corroborate the discounted cash flow analysis performed at each reporting unit, a market approach is utilized using observable market data such as comparable companies in similar lines of business that are publicly traded or which are part of a public or private transaction (to the extent available). Results of the annual impairment test performed as of January 31, ~~2018,~~2019, indicated that the fair value of each reporting unit exceeded its carrying amount and no reporting units were at risk of failing the impairment test. As a result, no0 impairment charge was recognized. There was also no indication of potential impairment as of July 31, ~~2018~~2019 and April 30, ~~2018~~2019 that ~~would have~~ required further testing.

Intangible assets primarily consist of customer lists, non-compete agreements, proprietary databases ~~intellectual property~~ and ~~trademarks and~~IP. Intangible assets are recorded at their estimated fair value at the date of acquisition and are amortized in a pattern in which the asset is consumed, if that pattern can be reliably determined, or using the straight-line method over their estimated useful lives, which range from one to 24 years. For intangible assets subject to amortization, an impairment loss is recognized if the carrying amount of the intangible assets is not recoverable and exceeds fair value. The carrying amount of the intangible assets is considered not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from use of the asset. Intangible assets with indefinite lives are not amortized, but are reviewed annually for impairment or more frequently whenever events or changes in circumstances ~~indicate~~indicated that the fair value of the asset may be less than its carrying amount. As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, there were ~~no further~~0 indicators of impairment with respect to the Company’s intangible ~~assets, with the exception of the intangible asset impairment charge discussed below.~~assets.

On June 12, 2018, the Company’s Board of Directors voted to approve a ~~rebranding~~ plan ~~with the Company going~~to go to market under a single, master brand architecture ~~solely as Korn Ferry~~ and ~~sunsetting of all~~to simplify the Company’s ~~sub-brands, including Futurestep, Hay Group~~organizational structure by eliminating and/or consolidating certain legal entities and ~~Lominger, among others. This integrated go-to-market approach was~~implementing a ~~key driver in our fee revenue growth in FY’18, which led~~rebranding of the Company to offer the ~~decision to further integrate our go-to-market activities under one master brand – Korn Ferry.~~Company’s current products and services using the “Korn Ferry” name, branding and trademarks. As a result, the Company discontinued the use of all sub-brands. Two of the Company’s former sub-brands, Hay Group and Lominger, came to Korn Ferry through acquisitions. In connection with the accounting for these acquisitions, $106.6 million of the purchase price was allocated to ~~indefinite lived~~indefinite-lived tradename intangible assets. As a result of the decision to discontinue their use, the Company took a non-cash intangible asset ~~impairment charge~~write-off of $106.6 million during the three months ended of July 31, 2018, recorded in general and administrative expenses.

Compensation and benefits expense in the accompanying consolidated statements of operations consist of compensation and benefits paid to consultants (employees who originate business), executive officers and administrative and support personnel. The most significant portions of this expense are salaries and the amounts paid under the annual ~~performance related~~performance-related bonus plan to employees. The portion of the expense applicable to salaries is comprised of amounts earned by employees during a reporting period. The portion of the expenses applicable to annual ~~performance related~~performance-related bonuses refers to the Company’s annual employee ~~performance related~~performance-related bonus with respect to a fiscal year, the amount of which is communicated and paid to each eligible employee following the completion of the fiscal year.

Each quarter, management makes its best estimate of its annual ~~performance related~~performance-related bonuses, which requires management to, among other things, project annual consultant productivity (as measured by engagement fees billed and collected by executive search consultants and revenue and other performance/profitability metrics for Advisory and RPO ~~and~~& Professional Search consultants), the level of engagements referred by a consultant in one line of business to a different line of business,

and Company performance, including profitability, competitive forces and future economic conditions and their impact on the Company’s results. At the end of each fiscal year, annual ~~performance related~~performance-related bonuses take into account final individual consultant productivity (including referred work), Company/line of business results, including profitability, the achievement of strategic objectives, ~~and~~ the results of individual performance appraisals, and the current economic landscape. Accordingly, each quarter the Company reevaluates the assumptions used to estimate annual ~~performance related~~performance-related bonus liability and adjusts the carrying amount of the liability recorded on the consolidated balance sheet and reports any changes in the estimate in current operations.

Because annual performance-based bonuses are communicated and paid only after the Company reports its full fiscal year results, actual performance-based bonus payments may differ from the prior year’s estimate. Such changes in the bonus estimate historically have been immaterial and are recorded in current operations in the period in which they are determined. The ~~performance related~~performance-related bonus expense was ~~$61.0~~$53.0 million and ~~$41.6~~$61.0 million during the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, respectively, included in compensation and benefits expense in the consolidated statements of operations.

Other expenses included in compensation and benefits expense are due to changes in deferred compensation and pension plan liabilities, changes in cash surrender value (“CSV”) of ~~company owned~~company-owned life insurance (“COLI”) contracts, amortization of

stock compensation awards, payroll taxes and employee insurance benefits. Unearned compensation on the consolidated balance sheets includes long-term retention awards that are generally amortized over ~~four to five~~four-to-five years.

The Company accounts for its restructuring charges as a liability when the obligations are incurred and records such charges at fair value. Such charges included one-time employee termination benefits and the cost to terminate an office lease including remaining lease payments. Changes in the estimates of the restructuring charges are recorded in the period the change is determined.

The Company has employee compensation plans under which various types of stock-based instruments are granted. These instruments principally include restricted stock units, restricted stock and an Employee Stock Purchase Plan (“ESPP”). The Company recognizes compensation expense related to restricted stock units, restricted stock and the estimated fair value of stock purchases under the ESPP on a straight-line basis over the service period for the entire award.

Certain reclassifications have been made to the amounts in prior periods in order to conform to the current period’s presentation.

In May 2014, the FASB issued ASU 2014-09 (“ASC 606”), which superseded revenue recognition requirements regarding contracts with customers to transfer goods or services or for the transfer of nonfinancial assets. Under this guidance, entities are required to recognize revenue that depicts 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 goods or services. The transfer is considered to occur when the customer obtains control of the goods or services delivered. The guidance provides a five-step analysis to be performed on transactions to determine when and how revenue is recognized. The new guidance is effective for fiscal years and interim periods within those annual years beginning after December 15, 2017. The Company adopted ASC 606 in its fiscal year beginning May 1, 2018 using the modified retrospective transition method applied to those contracts still outstanding and not completed as of May 1, 2018.

The Company recognized the cumulative effect of initially applying the new guidance as an adjustment to the opening balance of retained earnings. The comparative periods have not been restated and continue to be reported under the revenue accounting standards in effect for those periods. As a result of the adoption, the Company recorded an increase to retained earnings of $6.7 million, net of tax as of May 1, 2018 due to the cumulative impact of adopting ASC 606. The change in total assets was recorded to unbilled receivables which is included in receivables due from clients; the changes in total liabilities was recorded to income taxes payable, deferred tax liabilities and deferred revenue, which is included in other accrued liabilities.

~~The following table summarizes the effect of changes made to our consolidated balance sheet at May 1, 2018:~~

The adjustments primarily relate to uptick revenue (uptick revenue occurs when a placement’s actual compensation is higher than the original estimated compensation) and certain Korn Ferry products that are now considered Functional IP. Under the new standard, uptick revenue is considered variable consideration and estimated at contract inception using the expected value method and recognized over the service period. Previously, the Company recognized uptick revenue as the amount became fixed or determinable. Under the new standard, certain products are now considered Functional IP as delivery of intellectual property content fulfills the performance obligation, and revenue is recognized upon delivery and when an enforceable right to payment exists. Previously these products were considered ~~term licenses and revenue was recognized ratably over the contract term.~~

In August 2016, the FASB issued guidance on the classification of certain cash receipts and cash payments in the statement of cash flows. The new guidance provides clarification on specific cash flow issues regarding presentation and classification in the statement of cash flows with the objective of reducing the existing diversity in practice. The amendments in this update are effective for reporting periods beginning after December 15, 2017 and were adopted by the Company effective May 1, 2018. The adoption of this guidance did not have an impact on the Company’s consolidated financial statements.

In January 2017, the FASB issued guidance that clarifies the definition of a business. The new guidance assists a company when evaluating whether transactions should be accounted for as acquisitions (disposals) of assets or businesses. The provisions of the guidance require that if the fair value of the gross assets acquired (or disposed of) is substantially concentrated in a single identifiable asset or a group of similar identifiable assets, then it is not a business. The provisions of the guidance are to be applied prospectively. The provisions of the guidance are effective for annual years beginning after December 15, 2017 and were adopted by the Company effective May 1, 2018. The adoption of this guidance did not have an impact on the Company’s consolidated financial statements.

In March 2017, the FASB issued guidance that changes the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance will change the presentation of net periodic benefit cost related to employer sponsored defined benefit plans and other postretirement benefits. Service cost will be included within the same income statement line item as other compensation costs arising from services rendered during the period, while other components of net periodic benefit pension cost will be presented separately outside of operating income. Additionally, only service costs may be capitalized in assets. This pronouncement is effective for annual reporting periods beginning after December 15, 2017 and was adopted by the Company effective May 1, 2018. The change to the c~~onsolidated statements of operations~~ ~~has been reflected on a retrospective basis and had no effect on net (loss) income.~~ Prior period amounts were revised, which resulted in a decrease in compensation expense and other income of $1.2 million and $0.2 million, respectively, and an increase in interest expense of $1.0 million (see Note 6—~~Deferred Compensation and Retirement Plans~~).

In May 2017, the FASB issued guidance clarifying the scope of modification accounting for stock compensation. The new standard provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. This pronouncement is effective for annual reporting periods beginning after December 15, 2017 and was adopted by the Company effective May 1, 2018. The adoption of this guidance did not have an impact on the Company’s consolidated financial statements. Any future impact of this guidance will be dependent on future modification including the number of awards modified

In February 2018, the FASB issued guidance that provides companies the option to reclassify stranded tax effects from accumulated other comprehensive (loss) income to retained earnings. The new guidance requires companies to disclose whether they decided to reclassify the income tax effects of the Tax Act from accumulated other comprehensive income (loss) to retained earnings. The guidance is effective for annual reporting periods beginning after December 15, 2018, but early adoption is permitted. The Company early adopted effective May 1, 2018 and elected not to reclassify prior periods but instead record it in the period of adoption. The adoption of this guidance resulted in an increase of $2.2 million to retained earnings due to the reclassification from accumulated other comprehensive (loss) income to retained earnings.

In February 2016, the ~~FASB~~Financial Accounting Standards Board (“FASB”) issued guidance (Accounting Standard Codification 842 – Leases) on accounting for leases that generally requires all leases to be recognized on the consolidated balance sheet. The ~~provisions of the~~ guidance ~~are~~is effective for fiscal years beginning after December 15, 2018 and early adoption is permitted. The Company plans to adopt this guidance in fiscal year beginning May 1, 2019. The provisions of the guidance are to be applied using a modified retrospective approach.2018. On July 30, 2018, the FASB issued an amendment that allows entities to apply the provisions at the effective date without adjusting comparative periods. The Company ~~is still evaluating the effect~~adopted this guidance ~~will~~in its fiscal year beginning May 1, 2019 using a modified retrospective approach without restatement of comparative periods. As such, periods prior to the date of adoption are presented in accordance with Accounting Standard Codification 840 - Leases. The FASB also issued subsequent related Accounting Standards Updates (“ASUs”), which detail amendments to the ASU, implementation considerations, narrow-scope improvements and practical expedients. The Company has elected to apply the group of practical expedients which allows the Company to carry forward its identification of contracts that are or contain leases, its historical lease classification and its initial direct costs for existing leases. The Company has also elected to combine lease and non-lease components for all asset classes and recognize leases with an initial term of 12 months or less on a straight-line basis without recognizing a ROU asset or operating lease liability.

The adoption of this standard had a material impact on the consolidated balance sheet as of July 31, 2019 due to the recognition of ROU assets and operating lease liabilities, but an immaterial impact on the Company’s consolidated statements of operations, consolidated statements of stockholders’ equity, and consolidated statements of cash flows. Upon adoption we recognized total ROU assets of $236.1 million with a corresponding liability of $272.3 million. The ROU asset balance was adjusted by the reclassification of pre-existing prepaid expenses and other assets and deferred rent balances of $5.1 million and $41.3 million, respectively.

In August 2017, the FASB issued guidance amending and simplifying accounting for hedging activities. The guidance refined and expanded strategies that qualify for hedge accounting and simplify the application of hedge accounting in certain situations. The guidance is effective for fiscal years beginning after December 15, 2018. The Company adopted this guidance in its fiscal year beginning May 1, 2019. The adoption of this guidance did not have an impact on the consolidated financial statements. ~~Based~~

In June 2016, the FASB issued guidance on ~~our initial assessment,~~accounting for measurement of credit losses on financial Instruments, which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. The standard is effective for fiscal years beginning after December 15, 2019. The Company ~~expects that upon~~will adopt this guidance in its fiscal year beginning May 1, 2020. The adoption ~~it will report an increase in assets and liabilities~~of this guidance is not anticipated to have a material impact on ~~our~~the consolidated ~~balance sheet as a result of recognizing right-of-use assets and lease liabilities related to lease agreements.~~financial statements.

In January 2017, the FASB issued guidance simplifying the test for goodwill impairment. The new guidance simplifies the test for goodwill impairment by removing Step 2 from the goodwill impairment test. Companies will now perform the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, recognizing an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value not to exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The amendments of this standard are effective for goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for goodwill impairment tests performed after January 1, 2017. The Company is evaluating the adoption timeline and the effects that the standard will have on the consolidated financial statements.

In August ~~2017,~~2018, the FASB issued guidance amending the disclosure requirements for fair value measurements. The amendment removes and ~~simplifying accounting for hedging activities. The new guidance will refine~~modifies disclosures that are currently required and ~~expand strategies~~adds additional disclosures that ~~qualify for hedge accounting and simplify the application of hedge accounting in certain situations.~~are deemed relevant. The amendments of this standard are effective for fiscal years beginning after December 15, ~~2018.~~2019. The Company will adopt this guidance in its fiscal year beginning May 1, ~~2019.~~2020.The Company is currently evaluating the impact of adopting this guidance.

In August 2018, the FASB issued guidance amending accounting for internal-use software. The new guidance will align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with developing or obtaining internal-use software. The amendments of this standard are effective for fiscal years ending after December 15, 2019 with early adoption permitted. The Company will adopt this guidance in its fiscal year beginning May 1, 2020. The Company is currently evaluating the impact of adopting this guidance.

Accounting Standards Codification 260, Earnings Per Share, requires companies to treat unvested share-based payment

awards that have non-forfeitable rights to dividends prior to vesting as a separate class of securities in calculating earnings per share. ~~We have~~The Company has granted and ~~expect~~expects to continue to grant to certain employees under ~~our~~its restricted stock agreements grants that contain non-forfeitable rights to dividends. Such grants are considered participating securities. Therefore, ~~we are~~the Company is required to apply the two-class method in calculating earnings per share. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings. The dilutive effect of participating securities is calculated using the more dilutive of the treasury method or the two-class method.

Basic earnings (loss) ~~earnings~~ per common share was computed using the two-class method by dividing basic net earnings (loss) ~~earnings~~ attributable to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings (loss) ~~earnings~~ per common share was computed using the two-class method by dividing diluted net earnings (loss) ~~earnings~~ attributable to common stockholders by the weighted-average number of common shares outstanding plus dilutive common equivalent shares. Dilutive common equivalent shares include all in-the-money outstanding options or other contracts to issue common stock as if they were exercised or converted. Financial instruments that are not in the form of common stock, but when converted into common stock increase earnings per share are anti-dilutive and are not included in the computation of diluted earnings per share. ~~Because the Company is in a net loss position, diluted net loss per share excludes the effects of common stock equivalents consisting of restricted stock awards, which are all antidilutive.~~

During the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, restricted stock awards of 0.7 million shares and 1.8 million ~~and 0.6 million~~shares were outstanding, respectively, but not included in the computation of diluted earnings (loss) ~~earnings~~ per share because they were anti-dilutive.

The following table summarizes basic and diluted earnings (loss) per common share attributable to common stockholders:

	Three Months Ended July 31,					Three Months Ended July 31,
	2018			2017		2019		2018
	(in thousands, except per share data)					(in thousands, except per share data)
Net (loss) income attributable to Korn/Ferry International	$	(38,611	)	$	29,041
Net income (loss) attributable to Korn Ferry						$	42,951	$	(38,611	)
Less: distributed and undistributed earnings to nonvested restricted stockholders		59			288		444		59
Basic net (loss) earnings attributable to common stockholders		(38,670	)		28,753
Basic net earnings (loss) attributable to common stockholders							42,507		(38,670	)
Add: undistributed earnings to nonvested restricted stockholders		—			232		386		—
Less: reallocation of undistributed earnings to nonvested restricted stockholders		—			230		384		—
Diluted net (loss) earnings attributable to common stockholders	$	(38,670	)	$	28,755
Diluted net earnings (loss) attributable to common stockholders						$	42,509	$	(38,670	)

Weighted-average common shares outstanding:
Basic weighted-average number of common shares outstanding		55,378			55,795		55,266		55,378
Effect of dilutive securities:
Restricted stock		—			588		357		—
Stock options		—			12
ESPP		—			8		12		—
Diluted weighted-average number of common shares outstanding		55,378			56,403		55,635		55,378

Net (loss) earnings per common share:
Basic (loss) earnings per share	$	(0.70	)	$	0.52
Diluted (loss) earnings per share	$	(0.70	)	$	0.51
Net earnings (loss) per common share:
Basic earnings (loss) per share						$	0.77	$	(0.70	)
Diluted earnings (loss) per share						$	0.76	$	(0.70	)

Comprehensive income (loss) ~~income~~ is comprised of net income (loss) ~~income~~ and all changes to stockholders’ equity, except those changes resulting from investments by stockholders (changes in paid in capital) and distributions to stockholders (dividends) and is reported in the accompanying consolidated statements of comprehensive income (loss) ~~income.~~. Accumulated other comprehensive income (loss) ~~income,~~, net of taxes, is recorded as a component of stockholders’ equity.

The components of accumulated other comprehensive income (loss) ~~income~~ were as follows:

~~The following table summarizes the changes in each component of accumulated other comprehensive (loss) income for the three months ended July 31, 2018.~~

The following table summarizes the changes in each component of accumulated other comprehensive income (loss) ~~income~~ for the three months ended July 31, ~~2017:~~2019:

The following table summarizes the changes in each component of accumulated other comprehensive income (loss), net for the three months ended July 31, 2018:

The following table summarizes the components of stock-based compensation expense recognized in the Company’s consolidated statements of operations for the periods indicated:

At the Company’s 2016 Annual Meeting of Stockholders, held on October 6, 2016, the Company’s stockholders approved an amendment and restatement to the ~~Korn/~~Korn Ferry ~~International~~ Amended and Restated 2008 Stock Incentive Plan (the 2016 amendment and restatement being “The Third A&R 2008 Plan”), which among other things, increased the number of shares under the plan by 5,500,000, ~~shares,~~ increasing the current maximum number of shares that may be issued under the plan to 11,200,000 shares, subject to certain changes in the Company’s capital structure and other extraordinary events. The Third A&R 2008 Plan provides for the grant of awards to eligible participants, designated as either nonqualified or incentive stock options, restricted stock and restricted stock units, any of which ~~may be performance-based or~~are market-based, and incentive bonuses, which may be paid in cash or stock or a combination thereof. Under the Third A&R 2008 Plan, the ability to issue full-value awards is limited by requiring full-value stock awards to count 2.3 times as much as stock options.

The Company grants time-based restricted stock awards to executive officers and other senior employees generally vesting over a four-year period. In addition, certain key management members typically receive time-based restricted stock awards upon commencement of employment and may receive them annually inconjunction with the Company’sperformance review. Time-based restricted stock awards are granted at a price equal to fair value, which is determined based on the closing price of the Company’s common stock on the grant date. The Company recognizes compensation expense for time-based restricted stock awards on a straight-line basis over the vesting period.

The Company also grants market-based ~~and performance-based~~ restricted stock units to executive officers and other senior employees. The market-based units vest after three years depending upon the Company’s total stockholder return over the three-year performance period relative to other companies in its selected peer group. The fair value of these market-based restricted stock units are determined by using extensive market data that is based on historical Company and peer group information. The Company recognizes compensation expense for market-based restricted stock units on a straight-line basis over the vesting period.

Performance-based restricted stock units vest after three years depending upon the Company meeting certain objectives that are set at the time the restricted stock unit is issued. Performance-based restricted stock units are granted at a price equal to the fair value, which is determined based on the closing price of the Company’s common stock on the grant date. At the end of each reporting period, the Company estimates the number of restricted stock units expected to vest, based on the probability that certain performance objectives will be met, exceeded, or fall below target levels, and the Company takes into account these estimates when calculating the expense for the period.13

Restricted stock activity during the three months ended July 31, ~~2018~~2019 is summarized below:

	Shares			Weighted- Average Grant Date Fair Value		Shares			Weighted- Average Grant Date Fair Value
	(in thousands, except per share data)					(in thousands, except per share data)
Non-vested, April 30, 2018		1,730		$	33.45
Non-vested, April 30, 2019							1,460		$	38.42
Granted		478		$	48.55		551		$	38.86
Vested		(539	)	$	34.05		(584	)	$	24.15
Forfeited/expired		(20	)	$	26.86		(18	)	$	17.95
Non-vested, July 31, 2018		1,649		$	40.66
Non-vested, July 31, 2019							1,409		$	44.78

As of July 31, ~~2018,~~2019, there were ~~0.6 million shares and 0.2~~0.5 million shares outstanding relating to market-based ~~and performance-based~~ restricted stock units ~~respectively,~~ with total unrecognized compensation totaling ~~$14.5 million and $1.7 million, respectively.~~$17.9 million.

As of July 31, ~~2018,~~2019, there was ~~$48.1~~$51.2 million of total unrecognized compensation cost related to all non-vested awards of restricted stock, which is expected to be recognized over a weighted-average period of 2.8 years. During the three months ended July 31, 2019 and 2018, ~~and 2017, 199,795~~221,654 shares and ~~97,483~~199,795 shares of restricted stock totaling ~~$13.1~~$8.6 million and ~~$3.3~~$13.1 million, respectively, were repurchased by the Company, at the option of the employee, to pay for taxes related to vesting of restricted stock.

The Company has an ESPP that, in accordance with Section 423 of the Internal Revenue Code, allows eligible employees to authorize payroll deductions of up to 15% of their salary to purchase shares of the Company’s common stock at 85% of the fair market price of the common stock on the last day of the enrollment period. Employees may not purchase more than $25,000 in stock during any calendar year. The maximum number of shares that may be issued under the ESPP is 3.0 million shares. During the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, employees purchased 126,604 shares at $34.06 per share and 75,106 shares at $52.64 ~~per share and 116,285 shares at $29.35~~ per share, respectively. As of July 31, ~~2018,~~2019, the ESPP had approximately ~~1.0~~0.8 million shares remaining available for future issuance.

During the three months ended July 31, ~~2018 and 2017,~~2019, the Company ~~issued 6,720 shares and 41,075~~repurchased (on the open market or through privately negotiated transactions) 324,100 shares of the Company’s common stock ~~respectively, as a result of the exercise of stock options, with cash proceeds from the exercise of $0.2 million and $0.6 million, respectively.~~

for $12.7 million. During the three months ended July 31, 2018, no0 shares were repurchased by the Company (on the open ~~market)~~market or through privately negotiated transactions). ~~During the three months ended July 31, 2017, the Company repurchased (on the open market) 119,356 of the Company’s common stock for $4.0 million.~~

The following tables show the Company’s financial instruments and balance sheet classification as of July 31, ~~2018~~2019 and April 30, ~~2018:~~2019:

	July 31, 2018																					July 31, 2019
	Fair Value Measurement										Balance Sheet Classification											Fair Value Measurement										Balance Sheet Classification
	Cost		Unrealized Gains		Unrealized Losses			Fair Value			Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non- current		Income Taxes & Other Receivables		Other Accrued Liabilities			Cost		Unrealized Gains		Unrealized Losses			Fair Value			Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non- current		Other Accrued Liabilities
	(in thousands)																					(in thousands)
Level 1:
Cash	$	344,684	$	—	$	—		$	344,684		$	344,684	$	—	$	—	$	—	$	—		$	378,070	$	—	$	—		$	378,070		$	378,070	$	—	$	—	$	—
Money market funds		21,045		—		—			21,045			21,045		—		—		—		—			46,567		—		—			46,567			46,567		—		—		—
Mutual funds (1)		124,589		10,395		(908	)		134,076			—		10,952		123,124		—		—			136,258		7,168		(770	)		142,656			—		8,508		134,148		—
Total	$	490,318	$	10,395	$	(908	)	$	499,805		$	365,729	$	10,952	$	123,124	$	—	$	—		$	560,895	$	7,168	$	(770	)	$	567,293		$	424,637	$	8,508	$	134,148	$	—

Level 2:
Foreign currency forward contracts	$	—	$	603	$	(621	)	$	(18	)	$	—	$	—	$	—	$	—	$	(18	)	$	—	$	840	$	(1,411	)	$	(571	)	$	—	$	—	$	—	$	(571	)
Interest rate swap	$	—	$	2,256	$	—		$	2,256		$	—	$	—	$	—	$	2,256	$	—		$	—	$	—	$	(185	)	$	(185	)	$	—	$	—	$	—	$	(185	)

	April 30, 2018																			April 30, 2019
	Fair Value Measurement									Balance Sheet Classification										Fair Value Measurement									Balance Sheet Classification
	Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non- current		Income Taxes & Other Receivables		Other Accrued Liabilities		Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non- current		Income Taxes & Other Receivables
	(in thousands)																			(in thousands)
Level 1:
Cash	$	519,818	$	—	$	—		$	519,818	$	519,818	$	—	$	—	$	—	$	—	$	579,998	$	—	$	—		$	579,998	$	579,998	$	—	$	—	$	—
Money market funds		1,030		—		—			1,030		1,030		—		—		—		—		46,362		—		—			46,362		46,362		—		—		—
Mutual funds (1)		127,077		11,040		(1,032	)		137,085		—		14,293		122,792		—		—		135,439		6,301		(989	)		140,751		—		8,288		132,463		—
Total	$	647,925	$	11,040	$	(1,032	)	$	657,933	$	520,848	$	14,293	$	122,792	$	—	$	—	$	761,799	$	6,301	$	(989	)	$	767,111	$	626,360	$	8,288	$	132,463	$	—

Level 2:
Foreign currency forward contracts	$	—	$	1,778	$	(1,025	)	$	753	$	—	$	—	$	—	$	753	$	—	$	—	$	821	$	(722	)	$	99	$	—	$	—	$	—	$	99
Interest rate swap	$	—	$	2,076	$	—		$	2,076	$	—	$	—	$	—	$	2,076	$	—	$	—	$	619	$	—		$	619	$	—	$	—	$	—	$	619

Investments in marketable securities ~~classified as trading~~ are based upon investment selections the employee elects from a pre-determined set of securities in the ECAP, and the Company invests in marketable securities to mirror these elections. As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, the Company’s investments in marketable securities ~~classified as trading consist~~consisted of mutual funds for which market prices are readily available.

In March 2017, the Company entered into an interest rate swap contract with a notional amount of $129.8 million, to hedge the variability to changes in cash flows attributable to interest rate risks caused by changes in interest rates related to its variable rate debt. The Company has designated the swap as a cash flow hedge. ~~The notional amount will be amortized so that the amount is always half of the principal balance of the debt outstanding.~~ As of July 31, ~~2018,~~2019, the notional amount was ~~$116.9~~$103.1 million. The interest rate swap agreement matures on June 15, 2021, and locks the interest rates on ~~half~~a portion of the debt outstanding at 1.919%, exclusive of the credit spread on the debt.

The fair value of the derivative designated as a cash flow hedge instrument iswas as follows:

	July 31, 2018		April 30, 2018		July 31, 2019		April 30, 2019
	(in thousands)				(in thousands)
Derivative asset:
Interest rate swap contract	$	2,256	$	2,076	$	—	$	619
Derivative liability:
Interest rate swap contract					$	185	$	—

During the three months ended July 31, 2019 and 2018, the Company recognized the following gains and losses on the interest rate swap:

As the critical terms of the hedging instrument and the hedged forecasted transaction are the same, the Company has concluded that the changes in the fair value or cash flows attributable to the risk being hedged are expected to completely offset at inception and on an ongoing basis.

~~We estimate that $0.6 million of derivative gains included in accumulated other comprehensive income as of July 31, 2018 will be reclassified into interest expense, net within the following 12 months.~~ The cash flows related to the interest rate swap contract are included in net cash provided by operating activities.

The fair value of derivatives not designated as hedge instruments are as follows:

	July 31, 2018		April 30, 2018		July 31, 2019		April 30, 2019
	(in thousands)				(in thousands)
Derivative assets:
Foreign currency forward contracts	$	603	$	1,778	$	840	$	821
Derivative liabilities:
Foreign currency forward contracts	$	621	$	1,025	$	1,411	$	722

As of July 31, ~~2018,~~2019, the total notional amounts of the forward contracts purchased and sold were ~~$44.9~~$69.4 million and ~~$42.3~~$66.7 million, respectively. As of April 30, ~~2018,~~2019, the total notional amounts of the forward contracts purchased and sold were ~~$80.8~~$51.4 million and ~~$78.5~~$40.0 million, respectively. The Company recognizes forward contracts as a net asset or net liability on the consolidated balance sheets as such contracts are covered by a master netting agreement. During the three months ended July 31, 2019, the Company incurred losses of $1.6 million, related to forward contracts, which is recorded in general and administrative expenses in the accompanying consolidated statements of operations. These foreign currency losses offset foreign currency gains that result from transactions denominated in a currency other than the Company’s functional currency. During the three months ended July 31, 2018, the Company incurred gains of $0.1 million, related to forward contracts, which is recorded in general and administrative expenses in the accompanying consolidated statements of operations. These foreign currency gains offset foreign currency losses that result from transactions denominated in a currency other than the Company’s functional currency. During the three months ended July 31, 2017, the Company incurred losses of $2.6 million related to forward contracts which is recorded in general and administrative expenses in the accompanying consolidated statements of operations. These losses offset foreign currency gains that result from transactions denominated in a currency other than the Company’s functional currency. The cash flows related to foreign currency forward contracts are included in net cash used in operating activities.

The Company’s lease portfolio is comprised of operating leases for office space and equipment and finance leases for equipment. Equipment leases are comprised of vehicles and office equipment. The majority of the Company’s leases include both lease and non-lease components. Non-lease components primarily include maintenance, insurance, taxes and other utilities. The Company has decided to combine fixed payments for non-lease components with its lease payments and account for them as a single lease component, which increases its ROU assets and lease liabilities. Some of the leases include one or more options to renew or terminate the lease at the Company’s discretion. Generally, the renewal and termination options are not included in the ROU assets and lease liabilities as they are not reasonably certain of exercise. The Company has elected not to recognize a ROU asset or lease liability for leases with an initial term of 12 months or less.

As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of the future minimum lease payments. The Company applies the portfolio approach when determining the incremental borrowing rate since it has a centrally managed treasury function. The Company’s incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments in a similar economic environment.

Operating leases contain both office and equipment leases, have remaining terms that range from less than one year to 11 years, some of which also include options to extend or terminate the lease. Finance leases are comprised of equipment leases and have remaining terms that range from less than one year to 5 years. Finance lease assets are included in property and equipment, net while finance lease liabilities are included in other accrued liabilities and other liabilities.

The Company has several deferred compensation and retirement plans for eligible consultants and vice presidents that provide defined benefits to participants based on the deferral of current compensation or contributions made by the Company subject to vesting and retirement or termination provisions. Among these plans is a defined benefit pension plan for certain employees in the ~~United States.~~U.S.. The assets of this plan are held separately from the assets of the ~~sponsors~~sponsor in self-administered funds. All other defined benefit obligations from other plans are unfunded.

	Three Months Ended July 31,						Three Months Ended July 31,
	2018			2017			2019			2018
	(in thousands)						(in thousands)
Service cost	$	3,646		$	2,065		$	5,456		$	3,646
Interest cost		1,296			1,020			1,393			1,296
Amortization of actuarial loss		446			577			745			446
Expected return on plan assets (1)		(392	)		(399	)		(363	)		(392	)
Net periodic service credit amortization		(77	)		—			(77	)		(77	)
Net periodic benefit costs (2)	$	4,919		$	3,263		$	7,154		$	4,919

The Company purchased COLI contracts insuring the lives of certain employees eligible to participate in the deferred compensation and pension plans as a means of ~~funding benefits under~~setting aside funds to cover such plans. The gross CSV of these contracts of ~~$188.5~~ $219.1million and ~~$186.8~~$219.2 million as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively, iswas offset by outstanding policy loans of ~~$66.7~~$92.3 million and $93.2 million in ~~both~~ the accompanying consolidated balance sheets as of July 31, ~~2018~~2019 and April 30, ~~2018.~~2019, respectively. The CSV value of the underlying COLI investments increased by ~~$1.3~~$2.3 million and ~~$2.5~~$1.3 million during the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, respectively, and is recorded as a decrease in compensation and benefits expense in the accompanying consolidated statements of operations.

The Company’s ECAP is intended to provide certain employees an opportunity to defer salary and/or bonus on a pre-tax basis. In addition, the Company, as part of its compensation philosophy, makes discretionary contributions into the ECAP and such contributions may be granted to key employees annually based on the employee’s performance. Certain key management may also receive Company ECAP contributions upon commencement of employment. The Company amortizes these contributions on a straight-line basis over the service period, generally a ~~four- to five-year~~four-to-five year period. Participants have the ability to allocate their deferrals among a number of investment options and may receive their benefits at termination, retirement or ~~“in service”~~‘in service’ either in a lump sum or in quarterly installments over ~~one to 15~~one-to-15 years. The ECAP amounts that are expected to be paid to employees over the next 12 months are classified as a current liability included in compensation and benefits payable on the accompanying consolidated balance ~~sheet.~~sheets.

The ECAP is accounted for whereby the changes in the fair value of the vested amounts owed to the participants are adjusted with a corresponding charge (or credit) to compensation and benefits costs. During the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, deferred compensation liability increased; therefore, the Company recognized ~~an increase in~~ compensation expense of ~~$4.2~~$2.3 million and ~~$3.7~~$4.2 million, respectively. Offsetting the ~~increase~~increases in compensation and benefits expense was an increase in the fair value of marketable securities ~~classified as trading~~ (held in trust to satisfy obligations ~~under~~of the ~~ECAP)~~ECAP liabilities) of ~~$4.0~~$1.9 million and ~~$3.4~~$4.0 million during the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, respectively, recorded in other income, net on the consolidated statements of operations (see Note 5—Financial Instruments).

Substantially all fee revenue is derived from talent and organizational advisory services and the sale of products, fees for professional services related to executive and professional recruitment performed on a retained basis ~~recruitment process outsourcing, talent~~ and ~~organizational advisory services and the sale of products,~~RPO, standalone or as part of a solution. The Company adopted ASC 606 in its fiscal year beginning May 1, 2018 using the modified retrospective transition method applied to those contracts still outstanding and not completed as of May 1, 2018.

~~For the three months ended July 31, 2018, the Company recorded $0.2 million in additional revenue related to adoption of ASC 606. The impact of adoption to the balance sheet was immaterial.~~

A contract asset (unbilled receivables) is recorded when the Company transfers control of products or services before there is an unconditional right to payment. A contract liability (deferred revenue) is recorded when cash is received in advance of performance of the obligation. Deferred revenue represents the future performance obligations to transfer control of products or services for which we have already received consideration. Deferred revenue is presented in other accrued liabilities on the consolidated balance sheet.

The following table outlines our contract asset and liability balances as of July 31, ~~2018~~2019 and ~~May 1, 2018:~~April 30, 2019:

	July 31, 2018		May 1, 2018		July 31, 2019		April 30, 2019
	(in thousands)				(in thousands)
Contract assets (unbilled receivables)	$	68,570	$	65,164	$	72,508	$	60,595
Contract liabilities (deferred revenue)	$	104,581	$	114,695	$	112,676	$	112,999

During the three months ended July 31, ~~2018,~~2019, we recognized revenue of ~~$66.5~~$44.8 million that was included in the contract liabilities balance at the beginning of the period.

The Company has elected to apply the practical expedient to exclude the value of unsatisfied performance obligations for contracts with a duration of one year or less, which applies to all executive search and professional search fee revenue. As of July 31, ~~2018,~~2019, the aggregate transaction price allocated to the performance obligations that are unsatisfied for contracts with an expected duration of greater than one year at inception was ~~$486.7~~$556.7 million. Of the ~~$486.7~~$556.7 million of remaining performance obligations, ~~we expect~~the Company expects to recognize approximately ~~$225.6~~$264.5 million as fee revenue in fiscal ~~2019, $137.3 million in fiscal~~ 2020, ~~$72.4~~$163.6 million in fiscal 2021, ~~and the remaining $51.4~~$99.4 million in fiscal 2022 and the remaining $29.2 million in fiscal 2023 and thereafter. However, this amount should not be considered an indication of the Company’s future revenue as contracts with an initial term of one year or less are not included. Further, ~~our~~the Company’s contract terms and conditions allow for clients to increase or decrease the scope of services and such changes do not ~~become~~increase or decrease a performance obligation until the ~~company~~Company has an enforceable right to payment.

The Company disaggregates its revenue by line of business and further by region for Executive Search. This information is presented in Note 9—~~Business~~ 10—Segments.

	Three Months Ended July 31,										Three Months Ended July 31,
	2018					2017					2019					2018
	Dollars		%			Dollars		%			Dollars		%			Dollars		%
	(dollars in thousands)										(dollars in thousands)
Industrial	$	135,764		29.2	%	$	121,447		30.3	%	$	139,907		28.9	%	$	135,730		29.1	%
Financial Services		80,193	17.2				67,260	16.8				86,876		17.9			81,390		17.5
Life Sciences/Healthcare		79,169		17.0			66,580	16.6				82,114		16.9			79,160		17.0
Consumer Goods		71,794	15.4				61,831	15.4				71,833		14.8			71,586		15.4
Technology		61,849	13.3				51,772	12.9				69,095		14.3			62,819		13.5
Education		32,936	7.1				28,677	7.1
Education/Non-Profit												30,761		6.4			30,579		6.6
General		3,863	0.8				3,687	0.9				3,963		0.8			4,304		0.9
Fee Revenue	$	465,568		100.0	%	$	401,254		100.0	%	$	484,549		100.0	%	$	465,568		100.0	%

The provision for income tax was an expense of $14.5 million in the three months ended July 31, 2019 compared to a benefit of $16.1 million in the three months ended July 31, ~~2018 compared to an expense of $12.2 million in the three months ended July 31, 2017.~~2018. This reflects a ~~29.4%~~24.9% (provision) and 29.5% (benefit) ~~and 29.3% (provision)~~ tax rate for the three months ended July 31, ~~2018~~2019 and ~~2017~~2018, respectively. The Company’s effective tax rate ~~was 29.4% (benefit)~~ for the three months ended July 31, ~~2018 compared to~~2019 was higher than the U.S. federal statutory rate of 21.0%~~. This difference is~~ primarily due to U.S. state income taxes and taxable income outside the ~~trademark impairment charge and the~~U.S. that is subject to higher statutory tax rates, partially offset by an excess tax benefit ~~on vested~~recorded in connection with stock-based awards ~~both of~~that vested in the current quarter, which ~~were recorded as~~was discrete to the ~~current~~ quarter. The excess tax benefit is the amount by which the Company’s tax deduction for these awards, based on the fair market value of the awards on the date of vesting, exceeds the expense recorded in the Company’s financial statements over the awards’ vesting period. The Company’s effective tax rate (benefit) for the three months ended July 31, ~~2017~~2018 was ~~lower~~higher than the ~~then~~ U.S. federal statutory ~~rate of 35.0%~~ due ~~principally to the Company’s earnings outside the United States which were generally taxed at rates lower than the then applicable U.S. federal rate.~~

In accordance with Staff Accounting Bulletin No. 118 (“SAB 118”), we did not record any adjustment in the quarter to the provisional tax expense on accumulated foreign earnings (the “Transition Tax”) recorded during the fiscal year ended April 30,

2018 after the enactment of the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). This provisional expense may be adjusted in subsequent periods based on additional guidance that may be issued by the U.S. Treasury Department, the Internal Revenue Service (“IRS”) and other standard-setting bodies The Company will continue to appropriately analyze and, if necessary, adjust this amount within the measurement period provided under SAB 118, with the analysis to be completed no later than December 22, 2018.

The Company also continues to evaluate the impact of the Global Intangible Low-Taxed Income (“GILTI”), Foreign Derived Intangible Income (“FDII”), Base Erosion and Anti-Abuse Tax (“BEAT”), the change to the IRC Section 162(m) limitation (the “Executive Compensation Limitation”) and IRC Section 163 (j) interest limitation (the “Interest Limitation) provisions of the Tax Act which is complex and subject to continuing regulatory interpretation. In accordance with SAB 118, we recorded a provisional estimate in our effective tax rate for the three months ended July 31, 2018 for GILTI, FDIItrademark impairment charge and the ~~Executive Compensation Limitation. For BEAT and the Interest Limitation computations, we did not record a provisional estimate in our effective~~excess tax rate for the three months ended July 31, 2018 because we currently estimate that these provisions will not affect our tax expense in the current fiscal year. We will continue to refine our provisional estimates for the GILTI, FDII, BEAT, Executive Compensation Limitation and Interest Limitation computationsbenefit on vested stock-based awards, both of which were recorded as we gather additional information and receive additional guidance from standard-setting bodies. The Company is required to make an accounting policy election of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current period expense when incurred (the “period cost method”) or (2) factoring such amounts in the Company’s measurement of its deferred taxes (the “deferred method”). The Company’s accounting policy election with respectdiscrete to the new GILTI rules will depend, in part, on analyzing its global income to determine whether it can reasonably estimate the tax impact. In accordance with SAB 118, the Company is continuing with its analysis and has not yet determined which method to elect.quarter.

The Company currently operates ~~in three~~through 3 global ~~businesses:~~business segments: Advisory, Executive Search ~~Advisory~~ and RPO & Professional Search. The Executive Search segment focuses on recruiting Board of Director and C-level positions, in addition to research-based interviewing and onboarding solutions, for clients predominantly in the consumer, financial services, industrial, life sciences/healthcare and technology industries. Advisory assists clients to synchronize strategy and talent by addressing four fundamental needs: Organizational Strategy, Assessment and Succession, Leadership Development and Rewards and Benefits, all underpinned by a comprehensive array of one of the world-leading ~~intellectual property,~~IP, products and tools. Executive Search focuses on recruiting board level, chief executive and other senior executive and general management positions, in addition to research-based interviewing and assessment solutions, for clients predominantly in the consumer goods, financial services, industrial, life sciences/healthcare and technology industries. RPO & Professional Search ~~is a global industry leader in high-impact talent acquisition solutions. Its portfolio~~uses data-backed insight and IP, matched with strategic collaboration and innovative technology, to meet people challenges head on—and succeed. Solutions span all aspects of ~~services includes global~~RPO, Professional Search and ~~regional RPO, project recruitment, individual professional search and consulting. The~~Project Recruitment. Executive Search ~~business segment~~ is managed by geographic regional leaders and Advisory and RPO & Professional Search worldwide operations are managed by their Chief Executive Officers. The Executive Search geographic regional leaders and the Chief Executive Officers of Advisory and RPO & Professional Search report directly to the Chief Executive Officer of the Company. The Company also operates a Corporate segment to record global expenses of the Company.

The Company evaluates performance and allocates resources based on the Company’s chief operating decision maker’s review of (1) fee revenue and (2) adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). To the extent that such charges occur, Adjusted EBITDA excludes restructuring charges, integration/acquisition costs, certain separation costs and certain non-cash charges (goodwill, intangible asset and other than temporary impairment). The accounting policies for the reportable segments are the same as those described in the summary of significant accounting policies in Note 1—Organization and Summary of Significant Accounting Policies, except the items described above are excluded from EBITDA to arrive at Adjusted EBITDA.

	Three Months Ended July 31, 2019
			Executive Search
	Advisory		North America		EMEA		Asia Pacific		Latin America		Subtotal		RPO & Professional Search		Corporate			Consolidated
	(in thousands)
Fee revenue	$	195,526	$	111,722	$	46,530	$	27,362	$	7,585	$	193,199	$	95,824	$	—		$	484,549
Total revenue	$	199,320	$	115,446	$	47,312	$	27,668	$	7,587	$	198,013	$	98,865	$	—		$	496,198

Net income attributable to Korn Ferry																		$	42,951
Net income attributable to noncontrolling interest																			699
Other income, net																			(1,826	)
Interest expense, net																			4,057
Income tax provision																			14,453
Operating income (loss)	$	25,791	$	30,322	$	7,311	$	6,993	$	1,010	$	45,636	$	15,041	$	(26,134	)		60,334
Depreciation and amortization		8,053		901		456		346		328		2,031		992		1,701			12,777
Other income (loss), net		726		1,140		12		15		57		1,224		74		(198	)		1,826
EBITDA and Adjusted EBITDA	$	34,570	$	32,363	$	7,779	$	7,354	$	1,395	$	48,891	$	16,107	$	(24,631	)	$	74,937

Three Months Ended July 31, 2018

Executive Search

North
America

EMEA

Asia Pacific

Latin
America

Subtotal

Advisory

RPO & Professional Search

Corporate

Consolidated

(in thousands)

Fee revenue

$
112,097

$
46,654

$
26,295

$
7,878

$
192,924

$
195,375

$
77,269

$
—

$
465,568

Total revenue

$
115,757

$
47,749

$
26,625

$
7,903

$
198,034

$
200,147

$
80,181

$
—

$
478,362

Net loss attributable to Korn/Ferry International

$
(38,611
)
Net income attributable to noncontrolling interest

19

Other income, net

(4,491
)
Interest expense, net

4,103

Equity in earnings of unconsolidated subsidiaries, net

(29
)
Income tax benefit

(16,110
)
Operating income (loss)

$
26,514

$
6,969

$
6,641

$
754

$
40,878

$
(83,079
)

$
11,645

$
(24,563
)

(55,119
)
Depreciation and amortization

979

370

370

107

1,826

7,431

761

1,713

11,731

Other income (loss), net

3,472

340

175

37

4,024

570

105

(208
)

4,491

Equity in earnings of unconsolidated subsidiaries, net

29

—

—

—

29

—

—

—

29

EBITDA

30,994

7,679

7,186

898

46,757

(75,078
)

12,511

(23,058
)

(38,868
)
Integration/acquisition costs

—

—

—

—

—

3,027

—

80

3,107

Tradename write-offs

—

—

—

—

—

106,555

—

—

106,555

Adjusted EBITDA

$
30,994

$
7,679

$
7,186

$
898

$
46,757

$
34,504

$
12,511

$
(22,978
)

$
70,794

	Three Months Ended July 31, 2017																				Three Months Ended July 31, 2018
	Executive Search																							Executive Search
	North America		EMEA		Asia Pacific		Latin America		Subtotal		Advisory		RPO & Professional Search		Corporate			Consolidated			Advisory			North America		EMEA		Asia Pacific		Latin America		Subtotal		RPO & Professional Search		Corporate			Consolidated
	(in thousands)																				(in thousands)
Fee revenue	$	91,833	$	40,121	$	21,578	$	7,659	$	161,191	$	179,453	$	60,610	$	—		$	401,254		$	195,375		$	112,097	$	46,654	$	26,295	$	7,878	$	192,924	$	77,269	$	—		$	465,568
Total revenue	$	95,205	$	41,058	$	21,880	$	7,664	$	165,807	$	183,296	$	65,814	$	—		$	414,917		$	200,147		$	115,757	$	47,749	$	26,625	$	7,903	$	198,034	$	80,181	$	—		$	478,362

Net income attributable to Korn/Ferry International																		$	29,041
Net loss attributable to Korn Ferry																																							$	(38,611	)
Net income attributable to noncontrolling interest																			388																					19
Other income, net																			(3,354	)																				(4,520	)
Interest expense, net																			3,680																					4,103
Equity in earnings of unconsolidated subsidiaries, net																			(30	)
Income tax provision																			12,210
Income tax benefit																																								(16,110	)
Operating income (loss)	$	22,070	$	6,675	$	3,141	$	1,026	$	32,912	$	19,055	$	8,245	$	(18,277	)		41,935		$	(83,079	)	$	26,514	$	6,969	$	6,641	$	754	$	40,878	$	11,645	$	(24,563	)		(55,119	)
Depreciation and amortization		949		428		320		107		1,804		8,085		796		1,524			12,209			7,431			979		370		370		107		1,826		761		1,713			11,731
Other income, net		282		56		105		20		463		431		8		2,452			3,354
Equity in earnings of unconsolidated subsidiaries, net		30		—		—		—		30		—		—		—			30
Other income (loss), net																						570			3,501		340		175		37		4,053		105		(208	)		4,520
EBITDA		23,331		7,159		3,566		1,153		35,209		27,571		9,049		(14,301	)		57,528			(75,078	)		30,994		7,679		7,186		898		46,757		12,511		(23,058	)		(38,868	)
Restructuring charges, net		—		—		40		—		40		240		—		—			280
Integration/acquisition costs		—		—		—		—		—		2,549		—		39			2,588			3,027			—		—		—		—		—		—		80			3,107
Tradename write-offs																						106,555			—		—		—		—		—		—		—			106,555
Adjusted EBITDA	$	23,331	$	7,159	$	3,606	$	1,153	$	35,249	$	30,360	$	9,049	$	(14,262	)	$	60,396		$	34,504		$	30,994	$	7,679	$	7,186	$	898	$	46,757	$	12,511	$	(22,978	)	$	70,794

On ~~June 15, 2016,~~December 19, 2018, the Company entered into ~~a senior secured $400.0 million~~an Amended and Restated Credit Agreement (the “Credit Agreement”) with a syndicate of banks and Wells Fargo Bank, National Association as administrative agent. On June 8, 2018, in anticipation of the approval by the Board of Directors of the Company of a rebranding and restructuring plan (which plan was approved on June 12, 2018), the Company entered into an amendmentagent to its Credit Agreement. The Amendment permits a holding company reorganization (the “KF Merger”), after which a new public holding company, Korn Ferry, will own all of the stock of the Company, and will become effective when certain conditions set forth therein, including consummation of the KF Merger,

~~are satisfied. The Company previously considered pursuing the KF Merger as part of the Plan. While the Company continues to pursue the Plan, it is further evaluating various~~among other ~~structuring alternatives to effectuate the Plan but may not do so via the KF Merger structure previously disclosed.~~things, provide for enhanced financial flexibility. The Credit Agreement provides for, among other things: (a) a ~~senior secured term loan facility in an aggregate principal amount of $275.0~~$650.0 million ~~(the “Term Facility”), (b) a~~five-year senior secured revolving credit facility (the “Revolver”) and together with the Term Facility, the “Credit Facilities”) in an aggregate principal amount of $125.0 million, (c) annual term loan amortization of 7.5%, 7.5%, 10.0%, 10.0%, and 10.0%, with the remaining principal due at maturity, (d)(b) certain customary affirmative and negative covenants, including a maximum consolidated total leverage ratio (as defined below) and a minimum interest coverage ~~ratio and (e) an expanded definition of permitted add-backs to Adjusted EBITDA in recognition of~~ratio. The Credit Agreement permits the ~~accelerated integration actions. The Company’s credit agreement permits~~ payment of dividends to stockholders and Company share repurchases so long as the pro forma leverage ratio is no greater than ~~2.50~~3.25 to 1.00, and the pro forma domestic liquidity is at least $50.0 million. The Company drew down ~~$275.0~~$226.9 million on the ~~new term loan~~Revolver and used ~~$140.0 million of~~ the proceeds to pay-off ~~the~~its term loan that was outstanding under its prior credit facility as of ~~April 30, 2016.~~December 19, 2018. The payoff of the term loan under the prior credit facility and draw down on the Revolver are considered a debt modification and therefore, the previously incurred unamortized and current debt issuance costs will be amortized over the life of the new issuance.

The principal balance of the Revolver is due on the date of its termination. The Revolver matures on December 19, 2023 and any unpaid principal balance is payable on this date. The Revolver may also be prepaid and terminated early by the Company at any time without premium or penalty (subject to customary LIBOR breakage fees).

At the Company’s option, loans issued under the Credit Agreement will bear interest at either LIBOR or an alternate base rate, in each case plus the applicable interest rate margin. The interest rate applicable to loans outstanding under the Credit ~~Facilities~~Agreement may fluctuate between LIBOR plus 1.25% per annum to LIBOR plus 2.00% per annum, in the case of LIBOR borrowings (or between the alternate base rate plus 0.25% per annum and the alternate base rate plus 1.00% per annum, in the alternative), based upon the Company’s total funded debt to Adjusted EBITDA ratio (as set forth in the Credit Agreement, the “consolidated leverage ratio”) at such time. In addition, the Company will be required to pay to the lenders a quarterly commitment fee ranging from 0.20% to 0.35% per annum on the average daily unused amount of the ~~Term Facility,~~Revolver, based upon the Company’s consolidated leverage ratio at such time, and fees relating to the issuance of letters of credit. During the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, the average interest rate on ~~the Term Facility~~our long-term debt arrangements was ~~3.24%~~3.69% and ~~2.34%~~3.24%, respectively.

Both the Revolver and the Term Facility mature on June 15, 2021 and may be prepaid and terminated early by the Company at any time without premium or penalty (subject to customary LIBOR breakage fees). The Term Facility is payable in quarterly installments with principal payments totaling $5.2 million made during the three months ended July 31, 2018. As of July 31, ~~2018, $233.7~~2019 and April 30, 2019, $226.9 million was outstanding under the ~~Term Facility compared to $238.9 million as of April 30, 2018.~~Revolver. The ~~current and long-term portion of~~ unamortized debt issuance costs associated with the long-term debt ~~was $2.4~~were $3.8 million and ~~$2.7~~$4.0 million as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. The fair value of the Company’s ~~Term Facility~~Revolver is based on borrowing rates currently required of loans with similar terms, maturity and credit risk. The carrying amount of the ~~Term Facility~~Revolver approximates fair value because the base interest rate charged varies with market conditions and the credit spread is commensurate with current market spreads for issuers of similar risk. The fair value of the ~~Term Facility~~Revolver is classified as a Level 2 liability in the fair value hierarchy. As of July 31, ~~2018,~~2019, the Company was in compliance with its debt covenants.

~~As of July 31, 2018 and April 30, 2018, the Company had no borrowings under the Revolver.~~ The Company had a total of ~~$122.1~~$419.9 million available under the Revolver after the Company drew down $226.9 million and after $3.2 million of standby letters of credit were issued as of July 31, 2019. The Company had a total of $420.2 million

available under the Revolver after the Company drew down $226.9 million and after $2.9 million of standby letters of credit were issued as of ~~July 31, 2018 and~~ April 30, ~~2018, respectively.~~2019. The Company had a total of ~~$7.9~~$8.9 million and ~~$7.4~~$8.5 million of standby letters with other financial institutions as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. The standby letters of credits were generally issued as a result of entering into office premise leases.

On September ~~5, 2018,~~4, 2019, the Board of Directors of the Company declared a cash dividend of $0.10 per share with a payment date of October 15, ~~2018~~2019 to holders of the Company’s common stock of record at the close of business on September ~~28, 2018.~~27, 2019. The declaration and payment of future dividends under the quarterly dividend policy will be at the discretion of the Board of Directors and will depend upon many factors, including the Company’s earnings, capital requirements, financial conditions, the terms of the Company’s indebtedness and other factors that the Board of Directors may deem to be relevant. The Board of Directors may amend, revoke or suspend the dividend policy at any time and for any reason.

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q may contain certain statements that we believe are, or may be considered to be, “forward-looking” statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements generally can be identified by use of statements that include phrases such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” “may,” “will,” “likely,” “estimates,” “potential,” “continue” or other similar words or phrases. Similarly, statements that describe our objectives, plans or goals also are forward-looking statements. All of these forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from those contemplated by the relevant forward-looking statement. The principal risk factors that could cause actual performance and future actions to differ materially from the forward-looking statements include, but are not limited to, changes in demand for our services as a result of automation, dependence on and costs of attracting and retaining qualified and experienced consultants, maintaining our relationships with customers and suppliers and retaining key employees, maintaining our brand name and professional reputation, the expected timing ~~and manner~~of the consummation of the Plan (as defined below), the impact of the Plan’s rebranding on the Company’s products and services, the costs of the Plan, potential legal liability and regulatory developments, portability of client relationships, global and local political or economic developments in or affecting countries where we have operations, currency fluctuations in our international operations, risks related to growth, restrictions imposed by off-limits agreements, competition, consolidation in industries, reliance on information processing systems, cyber security vulnerabilities, changes to data security, data privacy, and data protection laws, dependence on third parties for the execution of critical functions, limited protection of our intellectual property (“IP”), our ability to enhance and develop new technology, our ability to successfully recover from a disaster or other business continuity problems, employment liability risk, an impairment in the carrying value of goodwill and other intangible assets, the effects of the Tax Cuts and Jobs Act (the “Tax Act”) and other future changes in tax laws, treaties, or regulations on our business and our company, deferred tax assets that we may not be able to use, our ability to develop new products and services, the impact of the withdrawal of the United Kingdom from the European Union, changes in our accounting estimates and assumptions, alignment of our cost structure, ~~risks related to the integration of recently acquired businesses,~~ the utilization and billing rates of our consultants, seasonality, expansion of social media platforms, our indebtedness, the phase-out of LIBOR, and the matters disclosed under the heading “Risk Factors” in the Company’s Exchange Act reports, including Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, ~~2018~~2019 (“Form 10-K”). Readers are urged to consider these factors carefully in evaluating the forward-looking statements. The forward-looking statements included in this Quarterly Report on Form 10-Q are made only as of the date of this Quarterly Report on Form 10-Q, and we undertake no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances.

The following presentation of management’s discussion and analysis of our financialcondition and results of operations should be read together with our consolidatedfinancial statements and related notes included in this Quarterly Report onForm 10-Q. We also make available on the Investor Relations portion of our website ~~at www.kornferry.com~~ earnings slides and other important information, which we encourage you to review.

~~Korn/~~Korn Ferry ~~International~~ (referred to herein as the “Company,~~” “Korn Ferry,~~” or in the first person notations “we,” “our,” and “us”) is a global organizational consulting ~~firm. Our services include Executive Search, advisory solutions and products~~firm. We currently operate through three global segments: Korn Ferry Advisory (“Advisory”), Executive Search and ~~recruitment for non-executive professionals and recruitment process outsourcing (“RPO”) through~~ Korn Ferry RPO and Professional Search (“RPO & Professional ~~Search)~~Search”). ~~The Company also operates~~Advisory assists clients to synchronize strategy and talent by addressing four fundamental needs: Organizational Strategy, Assessment and Succession, Leadership Development, and Rewards and Benefits, all underpinned by a ~~Corporate segment to record global expenses~~comprehensive array of one of the ~~Company. Approximately 69% of the executive searches we performed in fiscal 2018 were for~~world-leading IP, products and tools. Executive Search focuses on recruiting board level, chief executive and other senior executive and general management ~~positions. Our 3,773 search engagement~~positions, in addition to research-based interviewing and assessment solutions, for clients predominantly in ~~fiscal 2018 included many~~the consumer goods, financial services, industrial, life sciences/healthcare and technology industries. RPO & Professional Search uses data-backed insight and IP, matched with strategic collaboration and innovative technology, to meet people challenges head-on—and succeed. Solutions span all aspects of Recruitment Process Outsourcing (“RPO”), Professional Search and Project Recruitment. We also operate a Corporate segment to record global expenses of the world’s largest and most prestigious public and private companies. We have built strong client loyalty, with 88% of assignments performed during fiscal 2018 having been on behalf of clients for whom we had conducted assignments in the previous three fiscal years. Approximately 62% of our revenues were generated from clients that utilize multiple lines of business.

Superior performance comes from having the right conditions for success in two key areas—the organization and its people. Organizational conditions encourage people to put forth their best effort and invest their energy towards achieving the organization’s purpose. We can help operationalize a client’s complete strategy or address any combination of five broad categories:Company.

While most organizations can develop a sound strategy, they often struggle with how to make it stick. That is where we come in: synchronizing an organization’s strategy with its talent to drive superior performance. We help companies design their organization—the structure, roles and responsibilities—to seize these opportunities. In addition, we help organizations select and hire the talent they need to execute their strategy—and show them the best way to compensate, develop and motivate their people.

On June 12, 2018, the Company’s Board of Directors ~~voted to approve~~approved the One Korn Ferry rebranding plan for the Company (the “Plan”). This Plan includes going to market under a single, master brand architecture, solely as Korn Ferry and sunsetting of all the Company’s sub-brands, including Futurestep, Hay Group and Lominger, among others. This integrated go-to-market approach was a key driver in our fee revenue growth in ~~FY’18,~~fiscal year 2018, which led to the decision to further integrate our go-to-market activities under one master brand –— Korn Ferry. As a result, the Company discontinued the use of all ~~sub-brands.~~sub-brands and changed its name, effective January 1, 2019, to “Korn Ferry.” Two of the Company’s former sub-brands, Hay Group and Lominger came to Korn Ferry through acquisitions. In connection with the accounting for these acquisitions, $106.6 million of the purchase price was allocated to ~~indefinite lived~~indefinite-lived tradename intangible assets. As a result of the decision to discontinue their use, the Company took a one-time, non-cash write-off of tradenames of $106.6 million during the three months ended of July 31, 2018. As part of the Plan, the Company previously considered pursuing a holding company reorganization (the “KF Merger”). While the Company continues to pursue the Plan, it is further evaluating various other structuring alternatives to effectuate the Plan but may not do so via the KF Merger structure previously disclosed.

The Company currently operates inthrough three global ~~business segments: Executive Search, Advisory and RPO & Professional Search.~~segments. See Note ~~9 —~~ ~~Business~~ 10—Segments,in the Notes to Consolidated Unaudited Financial Statements for discussion of the Company’s global business segments. The Company evaluates performance and allocates resources based on the chief operating decision maker’s review of (1) fee revenue and (2) adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). To the extent that such charges occur, Adjusted EBITDA excludes restructuring charges, integration/acquisition costs, ~~and~~ certain separation costs and certain non-cash charges (goodwill, intangible asset and other than temporary impairment). In the three months ended July 31, 2018, Adjusted EBITDA ~~excludes~~excluded $106.6 million of write-off of tradenames related to the Plan.

EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin are non-GAAP financial measures. They have limitations as analytical tools, should not be viewed as a substitute for financial information determined in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”), and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. In addition, they may not necessarily be comparable to non-GAAP performance measures that may be presented by other companies.

Management believes the presentation of these non-GAAP financial measures provides meaningful supplemental information regarding Korn Ferry’s performance by excluding certain charges, items of income and other items that may not be indicative of Korn Ferry’s ongoing operating results. The use of these non-GAAP financial measures facilitates comparisons to Korn Ferry’s historical performance and the identification of operating trends that may otherwise be distorted by ~~certain charges and other items that may not be indicative of Korn Ferry’s ongoing operating results.~~the factors discussed above. Korn Ferry includes these non-GAAP financial measures because management believes it is useful to investors in allowing for greater transparency with respect to supplemental information used by management in its evaluation of Korn Ferry’s ongoing operations and financial and operational decision-making. The accounting policies for the reportable segments are the same as those described in the summary of significant accounting policies in the accompanying consolidated financial statements, except that the above noted items are excluded from EBITDA to arrive at Adjusted EBITDA. Management further believes that EBITDA is useful to investors because it is frequently used by investors and other interested parties to measure operating performance among companies with different capital structures, effective tax rates and tax attributes and capitalized asset values, all of which can vary substantially from company to company.

Fee revenue was ~~$465.6~~$484.5 million during the three months ended July 31, ~~2018,~~2019, an increase of ~~$64.3~~$18.9 million, or ~~16%~~4%, compared to ~~$401.3~~$465.6 million in the three months ended July 31, ~~2017, with increases in~~2018. Exchange rates unfavorably impacted fee revenue by $11.3 million, or 2%, in ~~all business segments.~~the three months ended July 31, 2019 compared to the year-ago quarter. During the three months ended July 31, ~~2018,~~2019, we recorded operating income of $60.3 million, an ~~operating loss~~increase of ~~$55.1 million, a decrease of $97.0~~$115.4 million, as compared to operating ~~income~~loss of ~~$41.9~~$55.1 million in the three months ended July 31, ~~2017,~~2018, with the Advisory, segment contributing $83.1 million in operating losses, solely due to the write-off of tradenames, and Corporate segment incurred expenses net of other income of $24.6 million. Offsetting the results in these two segments was operating income from Executive Search and RPO

& Professional Search segments ~~of $40.9~~contributing $25.8 million, $45.6 million and ~~$11.6~~$15.0 million, ~~respectively.~~respectively, offset by Corporate expenses of $26.1 million. Net ~~loss~~income attributable to Korn Ferry in the three months ended July 31, ~~2018~~2019 was ~~$38.6~~$43.0 million, ~~a decrease~~an increase of ~~$67.6~~$81.6 million as compared to net ~~income~~loss attributable to Korn Ferry of ~~$29.0~~$38.6 million in the year-ago quarter. During the three months ended July 31, ~~2018,~~2019, Adjusted EBITDA was ~~$70.8~~$74.9 million, an increase of ~~$10.4~~$4.1 million ~~during the three months ended July 31, 2018,~~ from Adjusted EBITDA of ~~$60.4~~$70.8 million in the year-ago quarter, with the Advisory, Executive Search ~~Advisory~~ and RPO & Professional Search segments contributing ~~$46.8~~$34.6 million, ~~$34.5~~$48.9 million and ~~$12.5~~$16.1 million, respectively, offset by Corporate expenses net of other income of ~~$23.0~~$24.6 million.

Our cash, cash equivalents and marketable securities decreased ~~$158.1~~by $199.8 million to ~~$499.8~~$567.3 million at July 31, ~~2018,~~2019, compared to ~~$657.9~~$767.1 million at April 30, ~~2018.~~2019. This decrease iswas mainly due to annual bonuses earned in fiscal ~~2018~~2019 and paid during the first quarter of fiscal ~~2019,~~2020, sign-on and retention payments, ~~$13.2~~$10.7 million in payments for the purchase of property and equipment, ~~$13.1~~$12.7 million for stock repurchases in the open market, $8.6 million paid in tax withholding on restricted stock ~~vesting, $6.0~~vestings and $6.1 million in dividends paid during ~~first quarter of fiscal 2019 and $5.2 million in principal payments on our term loan, partially offset by cash provided by operating activities.~~the three months ended July 31, 2019. As of July 31, ~~2018,~~2019, we held marketable securities to settle obligations under our Executive Capital Accumulation Plan (“ECAP”) with a cost value of ~~$124.6~~$136.3 million and a fair value of ~~$134.1~~$142.7 million. Our vested obligations for which these assets were held in trust totaled ~~$125.4~~$133.7 million as of July 31, ~~2018~~2019 and our unvested obligations totaled ~~$19.1~~$17.3 million.

Our working capital ~~increased from April 30, 2018 to July 31, 2018~~decreased by ~~$14.5~~$22.4 million to ~~$470.3~~$563.5 million as of July 31, ~~2018.~~2019, as compared to $585.9 million at April 30, 2019. We believe that cash on hand and funds from operations and other forms of liquidity will be sufficient to meet our anticipated working capital, capital expenditures, general corporate requirements, repayment of the debt obligations ~~incurred in connection with previous acquisition, the retention pool obligations pursuant to the previous acquisition~~ and dividend payments under our dividend policy in the next twelve months. We had ~~no outstanding borrowings~~$419.9 million and $420.2 million available for borrowing under our ~~revolving credit facility~~Revolver at July 31, ~~2018~~2019 and April 30, ~~2018.~~2019, respectively. As of July 31, ~~2018,~~2019 and April 30, ~~2018,~~2019, there was $3.2 million and $2.9 million of standby letters of credit issued, respectively, under our long-term debt arrangements. We had a total of ~~$7.9~~$8.9 million and ~~$7.4~~$8.5 million of standby letters of credits with other financial institutions as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively.

The following table summarizes the results of our operations as a percentage of fee revenue:

	Three Months Ended July 31,						Three Months Ended July 31,
	2018			2017			2019			2018
Fee revenue		100.0	%		100.0	%		100.0	%		100.0	%
Reimbursed out-of-pocket engagement expenses		2.7			3.4			2.4			2.7
Total revenue		102.7			103.4			102.4			102.7
Compensation and benefits		69.1			68.0			67.8			69.1
General and administrative expenses		36.2			14.5			13.6			36.2
Reimbursed expenses		2.7			3.4			2.4			2.7
Cost of services		3.9			3.9			3.5			3.9
Depreciation and amortization		2.5			3.0			2.6			2.5
Restructuring charges, net		—			0.1
Operating (loss) income		(11.8	)		10.5
Net (loss) income		(8.3	%)		7.3	%
Net (loss) income attributable to Korn/Ferry International		(8.3	%)		7.2	%
Operating income (loss)								12.5			(11.8	)
Net income (loss)								9.0	%		(8.3	%)
Net income (loss) attributable to Korn Ferry								8.9	%		(8.3	%)

The following tables summarize the results of our operations by business segment:

	Three Months Ended July 31,										Three Months Ended July 31,
	2018					2017					2019					2018
	Dollars		%			Dollars		%			Dollars		%			Dollars		%
	(dollars in thousands)										(dollars in thousands)
Fee revenue
Advisory											$	195,526		40.3	%	$	195,375		42.0	%
Executive Search:
North America	$	112,097		24.1	%	$	91,833		22.9	%		111,722		23.1			112,097		24.1
EMEA		46,654		10.0			40,121		10.0			46,530		9.6			46,654		10.0
Asia Pacific		26,295		5.6			21,578		5.4			27,362		5.6			26,295		5.6
Latin America		7,878		1.7			7,659		1.9			7,585		1.6			7,878		1.7
Total Executive Search		192,924		41.4			161,191		40.2			193,199		39.9			192,924		41.4
Advisory		195,375		42.0			179,453		44.7
RPO & Professional Search		77,269		16.6			60,610		15.1			95,824		19.8			77,269		16.6
Total fee revenue		465,568		100.0	%		401,254		100.0	%		484,549		100.0	%		465,568		100.0	%
Reimbursed out-of-pocket engagement expense		12,794					13,663					11,649					12,794
Total revenue	$	478,362				$	414,917				$	496,198				$	478,362

	Three Months Ended July 31,												Three Months Ended July 31,
	2018						2017						2019						2018
	Dollars			Margin(1)			Dollars			Margin(1)			Dollars			Margin (1)			Dollars			Margin (1)
	(dollars in thousands)												(dollars in thousands)
Operating (loss) income
Operating income (loss)
Advisory													$	25,791			13.2	%	$	(83,079	)		(42.5	%)
Executive Search:
North America	$	26,514			23.7	%	$	22,070			24.0	%		30,322			27.1			26,514			23.7
EMEA		6,969			14.9			6,675			16.6			7,311			15.7			6,969			14.9
Asia Pacific		6,641			25.3			3,141			14.6			6,993			25.6			6,641			25.3
Latin America		754			9.6			1,026			13.4			1,010			13.3			754			9.6
Total Executive Search		40,878			21.2			32,912			20.4			45,636			23.6			40,878			21.2
Advisory		(83,079	)		(42.5	)		19,055			10.6
RPO & Professional Search		11,645			15.1			8,245			13.6			15,041			15.7			11,645			15.1
Corporate		(24,563	)					(18,277	)					(26,134	)					(24,563	)
Total operating (loss) income	$	(55,119	)		(11.8	%)	$	41,935			10.5	%
Total operating income (loss)													$	60,334			12.5	%	$	(55,119	)		(11.8	%)

Three Months Ended July 31, 2018

Executive Search

North
America

EMEA

Asia
Pacific

Latin
America

Subtotal

Advisory

RPO & Professional Search

Corporate

Consolidated

(in thousands)

Fee revenue

$
112,097

$
46,654

$
26,295

$
7,878

$
192,924

$
195,375

$
77,269

$
—

$
465,568

Total revenue

$
115,757

$
47,749

$
26,625

$
7,903

$
198,034

$
200,147

$
80,181

$
—

$
478,362

Net loss attributable to Korn/Ferry International

$
(38,611
)
Net income attributable to noncontrolling interest

19

Other income, net

(4,491
)
Interest expense, net

4,103

Equity in earnings of unconsolidated subsidiaries, net

(29
)
Income tax benefit

(16,110
)
Operating income (loss)

$
26,514

$
6,969

$
6,641

$
754

$
40,878

$
(83,079
)

$
11,645

$
(24,563
)

(55,119
)
Depreciation and amortization

979

370

370

107

1,826

7,431

761

1,713

11,731

Other income (loss), net

3,472

340

175

37

4,024

570

105

(208
)

4,491

Equity in earnings of unconsolidated subsidiaries, net

29

—

—

—

29

—

—

—

29

EBITDA

30,994

7,679

7,186

898

46,757

(75,078
)

12,511

(23,058
)

(38,868
)
Integration/acquisition costs

—

—

—

—

—

3,027

—

80

3,107

Tradename write-off

—

—

—

—

—

106,555

—

—

106,555

Adjusted EBITDA

$
30,994

$
7,679

$
7,186

$
898

$
46,757

$
34,504

$
12,511

$
(22,978
)

$
70,794

Adjusted EBITDA margin

27.6
%

16.5
%

27.3
%

11.4
%

24.2
%

17.7
%

16.2
%

15.2
%

	Three Months Ended July 31, 2017																											Three Months Ended July 31, 2019
	Executive Search																														Executive Search
	North America			EMEA			Asia Pacific			Latin America			Subtotal			Advisory			RPO & Professional Search			Corporate			Consolidated			Advisory			North America			EMEA			Asia Pacific			Latin America			Subtotal			RPO & Professional Search			Corporate			Consolidated
	(in thousands)																											(in thousands)
Fee revenue	$	91,833		$	40,121		$	21,578		$	7,659		$	161,191		$	179,453		$	60,610		$	—		$	401,254		$	195,526		$	111,722		$	46,530		$	27,362		$	7,585		$	193,199		$	95,824		$	—		$	484,549
Total revenue	$	95,205		$	41,058		$	21,880		$	7,664		$	165,807		$	183,296		$	65,814		$	—		$	414,917		$	199,320		$	115,446		$	47,312		$	27,668		$	7,587		$	198,013		$	98,865		$	—		$	496,198

Net income attributable to Korn/Ferry International																									$	29,041
Net income attributable to Korn Ferry																																																				$	42,951
Net income attributable to noncontrolling interest																										388																											699
Other income, net																										(3,354	)																										(1,826	)
Interest expense, net																										3,680																											4,057
Equity in earnings of unconsolidated subsidiaries, net																										(30	)
Income tax provision																										12,210																											14,453
Operating income (loss)	$	22,070		$	6,675		$	3,141		$	1,026		$	32,912		$	19,055		$	8,245		$	(18,277	)		41,935		$	25,791		$	30,322		$	7,311		$	6,993		$	1,010		$	45,636		$	15,041		$	(26,134	)		60,334
Depreciation and amortization		949			428			320			107			1,804			8,085			796			1,524			12,209			8,053			901			456			346			328			2,031			992			1,701			12,777
Other income, net		282			56			105			20			463			431			8			2,452			3,354
Equity in earnings of unconsolidated subsidiaries, net		30			—			—			—			30			—			—			—			30
EBITDA		23,331			7,159			3,566			1,153			35,209			27,571			9,049			(14,301	)		57,528
Restructuring charges, net		—			—			40			—			40			240			—			—			280
Integration/acquisition costs		—			—			—			—			—			2,549			—			39			2,588
Adjusted EBITDA	$	23,331		$	7,159		$	3,606		$	1,153		$	35,249		$	30,360		$	9,049		$	(14,262	)	$	60,396
Adjusted EBITDA margin		25.4	%		17.8	%		16.7	%		15.1	%		21.9	%		16.9	%		14.9	%					15.0	%
Other income (loss), net																													726			1,140			12			15			57			1,224			74			(198	)		1,826
EBITDA and Adjusted EBITDA																												$	34,570		$	32,363		$	7,779		$	7,354		$	1,395		$	48,891		$	16,107		$	(24,631	)	$	74,937
EBITDA and Adjusted EBITDA margin																													17.7	%		29.0	%		16.7	%		26.9	%		18.4	%		25.3	%		16.8	%					15.5	%

	Three Months Ended July 31, 2018
				Executive Search
	Advisory			North America			EMEA			Asia Pacific			Latin America			Subtotal			RPO & Professional Search			Corporate			Consolidated
	(in thousands)
Fee revenue	$	195,375		$	112,097		$	46,654		$	26,295		$	7,878		$	192,924		$	77,269		$	—		$	465,568
Total revenue	$	200,147		$	115,757		$	47,749		$	26,625		$	7,903		$	198,034		$	80,181		$	—		$	478,362

Net loss attributable to Korn Ferry																									$	(38,611	)
Net income attributable to noncontrolling interest																										19
Other income, net																										(4,520	)
Interest expense, net																										4,103
Income tax benefit																										(16,110	)
Operating income (loss)	$	(83,079	)	$	26,514		$	6,969		$	6,641		$	754		$	40,878		$	11,645		$	(24,563	)		(55,119	)
Depreciation and amortization		7,431			979			370			370			107			1,826			761			1,713			11,731
Other income (loss), net		570			3,501			340			175			37			4,053			105			(208	)		4,520
EBITDA		(75,078	)		30,994			7,679			7,186			898			46,757			12,511			(23,058	)		(38,868	)
Integration/acquisition costs		3,027			—			—			—			—			—			—			80			3,107
Tradename write-offs		106,555			—			—			—			—			—			—			—			106,555
Adjusted EBITDA	$	34,504		$	30,994		$	7,679		$	7,186		$	898		$	46,757		$	12,511		$	(22,978	)	$	70,794
Adjusted EBITDA margin		17.7	%		27.6	%		16.5	%		27.3	%		11.4	%		24.2	%		16.2	%					15.2	%

Three Months Ended July 31, ~~2018~~2019 Compared to Three Months Ended July 31, ~~2017~~2018

Fee Revenue. Fee revenue increased by ~~$64.3~~$18.9 million, or ~~16%~~4%, to ~~$465.6~~$484.5 million in the three months ended July 31, ~~2018~~2019 compared to ~~$401.3~~$465.6 million in the year-ago quarter. ~~The impact of exchange~~Exchange rates onunfavorably impacted fee revenue ~~was minimal~~by $11.3 million, or 2%, in the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter. The higher fee revenue was attributable to ~~organic~~ growth in ~~all solutions.~~RPO & Professional Search.

~~Executive Search.~~ ~~Executive Search~~Advisory. Advisory reported fee revenue of ~~$192.9~~$195.5 million, an increase of ~~$31.7~~$0.1 million, in the three months ended July 31, 2019 compared to $195.4 million in the year-ago quarter. Exchange rates unfavorably impacted fee revenue by $5.6 million, or ~~20%~~3%, in the three months ended July 31, ~~2018~~2019 compared to ~~$161.2~~the year-ago quarter.

Executive Search. Executive Search reported fee revenue of $193.2 million, an increase of $0.3 million, in the three months ended July 31, 2019 compared to $192.9 million in the year-ago quarter. Exchange rates unfavorably impacted fee revenue by $3.7 million, or 2%, in the three months ended July 31, 2019 compared to the year-ago quarter. As detailed below, Executive Search fee revenue ~~was higher~~increased in Asia Pacific offset by lower fee revenue in the all other regions in the three months ended July 31, ~~2018~~2019 as compared to the year-ago quarter. The higher fee revenue in Executive Search was mainly due to a 13% increase in the weighted-average fees billed per engagement (calculated using local currency) and a 6% increase in the number of engagements billed during the three months ended July 31, 2018 compared to the year-ago quarter.

North America reported fee revenue of $112.1 million, an increase of $20.3 million, or 22%, in the three months ended July 31, 2018 compared to $91.8 million in the year-ago quarter. North America’s fee revenue was higher due to a 14% increase in the number of engagements billed and a 7% increase in the weighted-average fees billed per engagement (calculated using local currency) during the three months ended July 31, 2018 compared to the year-ago quarter. The overall increase in fee revenue was driven by the increase in

fee revenue from industrial and financial services, ~~life sciences/healthcare,~~partially offset by decreases in the technology, consumer and ~~consumer goods~~education/non-profit sectors.

~~EMEA~~North America reported fee revenue of $111.7 million, a decrease of $0.4 million, in the three months ended July 31, 2019 compared to $112.1 million in the year-ago quarter. Exchange rates unfavorably impacted fee revenue by $0.2 million in three months ended July 31, 2019 compared to the year-ago quarter.

Europe, the Middle East, and Africa (“EMEA”) reported fee revenue of $46.5 million, a decrease of $0.2 million, in the three months ended July 31, 2019 compared to $46.7 million ~~an increase of $6.6~~in the year-ago quarter. Exchange rates unfavorably impacted fee revenue by $2.1 million, or ~~16%~~4%, in the three months ended July 31, 2018 compared to $40.1 million in the year-ago quarter. The change in fee revenue was due to a 21% increase in the weighted-average fees billed per engagement (calculated using local currency), offset by a 6% decrease in the number of engagements billed during the three months ended July 31, 20182019 compared to the year-ago quarter. The performance in ~~France,~~the United Kingdom and Switzerland were the primary contributors to the ~~increase~~decrease in fee revenue, partially offset by increases in the Netherlands and United Arab Emirates in the three months ended July 31, ~~2018 compared to the year-ago quarter. In terms of business sectors, industrial, financial services and consumer goods had the largest increase in fee revenue in the three months ended July 31, 2018~~2019 compared to the year-ago quarter.

Asia Pacific reported fee revenue of ~~$26.3~~$27.4 million, an increase of ~~$4.7~~$1.1 million, or ~~22%~~4%, in the three months ended July 31, ~~2018~~2019 compared to ~~$21.6~~$26.3 million in the year-ago quarter. Exchange rates unfavorably impacted fee revenue by $0.9 million, or 3%, in the three months ended July 31, 2019 compared to the year-ago quarter. The increase in fee revenue was ~~higher~~ due to ~~an 11% increase in the weighted-average fees billed per engagement (calculated using local currency) and~~ a 9%12% increase in the number of engagements billed during the three months ended July 31, ~~2018~~2019 compared to the year-ago ~~quarter.~~quarter, offset by a 4% decrease in the weighted-average fees billed per engagement (calculated using local currency). The performance in ~~China, Singapore, Australia and~~ Hong Kong, Japan, and Singapore were the primary contributors to the increase in fee revenue, partially offset by a decrease in fee revenue in China in the three months ended July 31, ~~2018 compared to the year-ago quarter, partially offset by a decline in fee revenue in Indonesia. Consumer~~

~~goods, life sciences/ healthcare, financial services, and technology were the main sectors contributing to the increase in fee revenue in the three months ended July 31, 2018 as~~2019 compared to the year-ago quarter.

Latin America reported fee revenue of ~~$7.9~~$7.6 million, a decrease of $0.3 million, or 4%, in the three months ended July 31, ~~2018~~2019 compared to ~~$7.7~~$7.9 million in the year-ago quarter. Exchange rates unfavorably impacted fee revenue by $0.5 million, or 6%, in the three months ended July 31, 2019 compared to the year-ago quarter. The ~~increase~~decrease in fee revenue in the region was due to ~~higher~~lower fee revenue in Colombia and ~~Peru~~Brazil, offset by higher fee revenue in Chile in the three months ended July 31, ~~2018~~2019 compared to the year-ago ~~quarter, partially offset by lower fee revenue in Chile.~~quarter.

~~Advisory.~~ ~~Advisory~~RPO & Professional Search. RPO & Professional Search reported fee revenue of ~~$195.4~~$95.8 million, an increase of ~~$15.9~~$18.5 million, or 9%24%, in the three months ended July 31, ~~2018~~2019 compared to ~~$179.5~~$77.3 million in the year-ago quarter. ~~Fee~~Exchange rates unfavorably impacted fee revenue ~~from consulting services was higher~~ by ~~$13.4~~$2.1 million, or 3% in the three months ended July 31, 2019 compared to the year-ago quarter. Higher fee revenues in RPO & Professional Search of $11.9 million and $6.6 million, respectively, drove the increase in fee revenue.

Compensation and benefits expense increased by $6.6 million, or 2%, to $328.5 million in the three months ended July 31, ~~2018 compared to~~2019 from $321.9 million in the year-ago ~~quarter, with the remaining increase of $2.5 million generated~~quarter. Exchange rates favorably impacted compensation and benefits by ~~our products business.~~

~~RPO & Professional Search.~~ ~~RPO & Professional Search reported fee revenue of $77.3 million, an increase of $16.7~~$6.9 million, or ~~28%~~2%, in the three months ended July 31, ~~2018 compared to $60.6 million in the year-ago quarter. Higher fee revenues in RPO and Professional Search of $9.3 million and $7.4 million, respectively, drove the increase in fee revenue.~~

Compensation and benefits expense increased $49.1 million, or 18%, to $321.9 million in the three months ended July 31, 2018 from $272.8 million in the year-ago quarter. Exchange rates minimally impacted compensation and benefits expenses in the three months ended July 31, 20182019 compared to the year-ago quarter. The increase in compensation and benefits was primarily due to an increase in ~~performance related~~average headcount, partially offset by a decrease in performance-related bonus expense ~~of $19.4 million~~ and ~~$1.7 million in the use of outside contractors due to higher fee revenues. Also contributing to the increase was~~ a ~~6% increase in average headcount, which contributed $12.8 million in higher salaries and related payroll taxes, $4.9 million increase in amortization of long-term incentive awards, $2.6 million~~decrease in the amounts owed under certain deferred compensation and retirement plans ~~and $1.0 million~~ in ~~stock-based compensation. The rest of~~ the ~~change is due~~three months ended July 31, 2019 compared to anthe year-ago quarter. Also offsetting the increase in ~~severance~~compensation and benefits expense was a decrease of $3.1 million of integration and acquisition costs ~~of $2.7 million~~ and ~~the~~higher income generated from a change in ~~the~~our cash surrender value (“CSV”) of ~~company owned~~the company-owned life insurance (“COLI”) of ~~$1.1~~$1.0 million in the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter.

Advisory compensation and benefits expense decreased by $2.1 million, or 2%, to $123.6 million in the three months ended July 31, 2019 from $125.7 million in the year-ago quarter. Exchange rates favorably impacted compensation and benefits by $3.3 million, or 3%, in the three months ended July 31, 2019 compared to the year-ago quarter. The decrease in compensation and benefits expense was due to a lower performance-related bonus expense and a decrease in integration and acquisition costs. The decreases in compensation and benefits expense was partially offset by higher salaries and payroll taxes and vacation expense driven by an increase in headcount by 4%, in the three months ended July 31, 2019 compared to the year-ago quarter. Advisory compensation and benefits expense, as a percentage of fee revenue, decreased to 63% in the three months ended July 31, 2019 from 64% in the year-ago quarter.

Executive Search compensation and benefits expense ~~increased~~decreased by ~~$21.5~~$4.0 million, or ~~20%~~3%, to ~~$128.9~~$124.9 million in the three months ended July 31, ~~2018~~2019 compared to ~~$107.4~~$128.9 million in the year-ago quarter. Exchange rates favorably impacted compensation and benefits by $2.3 million, or 2%, in the three months ended July 31, 2019 compared to the year-ago quarter. The ~~increase~~decrease was primarily due to ~~higher performance related~~a lower performance-related bonus expense of $12.6 million, an increase of $2.7 million in amortization of long-term incentive awards and $1.7 million increase in expenses associated with our deferred compensation and retirement plans (including the increases in the fair value of participants’ accounts). Also contributing to the increase in compensation and benefits expense was higher salaries and related payroll taxes of $4.1 million due to a 4% increase in average headcount reflecting our continued growth-related investment back into the business. The increase in performance related bonus expense was due to the increase in fee revenue.expense. Executive Search compensation and benefits expense, as a percentage of fee revenue, ~~was 67% in both the three months ended July 31, 2018 and 2017.~~

~~Advisory compensation and benefits expense increased $11.6 million, or 10%,~~decreased to ~~$125.7 million~~65% in the three months ended July 31, ~~2018~~2019 from ~~$114.1 million~~67% in the year-ago quarter. The change was primarily due to $3.3 million in higher performance related bonus expense due to the growth in fee revenue. The rest of the increase in compensation and benefits expense was due to increases in salaries and payroll taxes of $1.6 million, $2.0 million increase in severance expense, $1.5 million increase in amortization of long-term incentive awards, and $0.5 million in higher integration (retention) costs. Advisory compensation and benefits expense, as a percentage of fee revenue, was 64% in both the three months ended July 31, 2018 and 2017.

RPO & Professional Search compensation and benefits expense increased ~~$11.9~~by $13.8 million, or ~~28%~~25%, to ~~$54.9~~$68.7 million in the three months ended July 31, ~~2018~~2019 from ~~$43.0~~$54.9 million in the year-ago quarter. Exchange rates favorably impacted compensation and benefits by $1.2 million, or 2%, in the three months ended July 31, 2019 compared to the year-ago quarter. The increase was due to higher salaries and related payroll taxes ~~of $6.3 million due to~~resulting from a ~~29%~~31% increase in the average headcount in the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter. The higher average headcount ~~and the $1.0 million increase in the use of outside contractors~~ was ~~primarily~~ driven by the need to service an increase in fee revenue in the RPO business. Also contributing to the increase in compensation and benefits was a higher ~~performance related~~performance-related bonus ~~expense of $3.0 million.~~expense. RPO & Professional Search compensation and benefits expense, as a percentage of fee revenue, ~~was 71%~~increased to 72% in ~~both~~ the three months ended July 31, ~~2018 and 2017.~~2019 from 71% in the year-ago quarter.

Corporate compensation and benefits expense ~~increased~~decreased by ~~$4.1~~$1.1 million, or ~~49%~~9%, to ~~$12.4~~$11.3 million in the three months ended July 31, ~~2018~~2019 from ~~$8.3~~$12.4 million in the year-ago quarter. The ~~increase~~decrease was primarily due to athe change in the CSV of COLI ~~that increased compensation and benefits expense by $1.1 million~~ in the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter. Also contributing to the increase in compensation and benefits expense was higher stock-based compensation expense of $0.7 million, an increase in salaries and related payroll taxes of $0.7 million and $0.5 million increase in performance related bonus expense.

General and administrative expenses ~~increased $110.4~~was $65.8 million, a decrease of $102.9 million, or ~~189%~~61%, ~~to $168.7 million~~ in the three months ended July 31, ~~2018~~2019 compared to ~~$58.3~~$168.7 million in the year-ago quarter. Exchange rates ~~minimally~~favorably impacted general and administrative expenses ~~during~~by $2.2 million, or 1%, in the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter. The ~~increase~~decrease in general and administrative expenses was due to the write-off of tradenames of $106.6 million ~~related to~~in the ~~Plan and an increase of $3.2 million~~year-ago quarter with no such charge in ~~legal and other professional expenses during~~ the ~~three months ended July 31, 2018 compared to the year-ago~~current quarter. General and administrative expenses, as a percentage of fee revenue, was ~~36%~~14% in the three months ended July 31, ~~2018~~2019 compared to ~~15%~~36% in the ~~three months ended July 31, 2017.~~year-ago quarter. Excluding the tradename write-offs, general and administrative expenses as a percentage of fee revenue was 13% in the three months ended July 31, 2018.

~~Executive Search~~Advisory general and administrative expenses ~~increased $2.2 million, or 12%, to $20.5~~was $25.1 million in the three months ended July 31, ~~2018 from $18.3~~2019 compared to $131.0 million in the year-ago quarter. The ~~increase in general and administrative expenses was due to increases~~decrease of ~~$0.7~~$105.9 million and $0.6 million in legal and other professional expenses and foreign exchange loss, respectively, during the three months ended July 31, 2018 compared to the year-ago quarter. Executive Search general and administrative expenses, as a percentage of fee revenue, was 11% in both the three months ended July 31, 2018 and 2017.

Advisory general and administrative expenses increased $106.1 million, or 426%, to $131.0 million in the three months ended July 31, 2018 from $24.9 million in the year-ago quarter. The increase in general and administrative expenses was mainly due to the write-off of tradenames of $106.6 million in the ~~three months ended July 31, 2018 compared to~~year-ago quarter with no such charge in the ~~year-ago~~current quarter. Advisory general and administrative expenses, as a percentage of fee revenue, ~~was 67%~~decreased to 13% in the three months ended July 31, ~~2018 compared to 14%~~2019 from 67% in the ~~three months ended July 31, 2017.~~year-ago quarter. Excluding the tradename write-offs, general and administrative expenses as a percentage of fee revenue was 12% in the three months ended July 31, 2018.

Executive Search general and administrative expenses was $19.9 million, a decrease of $0.6 million, or 3%, in the three months ended July 31, 2019 compared to $20.5 million in the year-ago quarter. The decrease was primarily due to lower legal and other professional fees during the three months ended July 31, 2019 compared to the year-ago quarter. Executive Search general and administrative expenses, as a percentage of fee revenue, decreased to 10% in the three months ended July 31, 2019 from 11% in the year-ago quarter.

RPO & Professional Search general and administrative expenses was ~~$6.8~~$7.7 million in the three months ended July 31, ~~2018~~2019 compared to ~~$6.6~~$6.8 million in the year-ago quarter. The increase was primarily due to an increase in premise and office expense. RPO & Professional Search general and administrative expenses, as a percentage of fee revenue, ~~was 9%~~decreased to 8% in the three months ended July 31, ~~2018 compared to 11%~~2019 from 9% in the year-ago quarter.

Corporate general and administrative expenses increased ~~$2.0~~$2.6 million, or ~~24%~~25%, to ~~$10.5~~$13.1 million in the three months ended July 31, ~~2018~~2019 compared to ~~$8.5~~$10.5 million in the year-ago quarter. The increase ~~in general and administrative expenses~~ was ~~mainly~~primarily due to ~~an increase of $2.0 million~~increases in both marketing and business development expenses and legal and other professional ~~expenses.~~ expenses during the three months ended July 31, 2019 compared to the year-ago quarter.

Cost of services expense consists primarily of non-billable contractor and product costs related to the delivery of various services and products, primarily in RPO & Professional Search and Advisory. Cost of services expense ~~increased $2.5 million, or 16%, to $18.3~~was $17.1 million in the three months ended July 31, ~~2018~~2019 compared to ~~$15.8~~$18.3 million in the year-ago quarter. Cost of services expense, as a percentage of fee revenue, was 4% infor both the three months ended July 31, ~~2018~~2019 and ~~2017.~~2018.

Depreciation and amortization expenses were ~~$11.7~~$12.8 million, ~~a decrease~~an increase of ~~$0.5~~$1.1 million, or 4%9%, in the three months ended July 31, ~~2018~~2019 compared to ~~$12.2~~$11.7 million in the year-ago quarter. The ~~decrease was due~~increase relates primarily to ~~lower amortization expense associated with intangible assets as some of our intangible assets became fully amortized.~~technology investments made in the current and prior year in software and computer equipment, in addition to increases in leasehold improvements and furniture and fixtures.

Operating income increased by $115.4 million, or 209%, to $60.3 million in the three months ended July 31, ~~2018, no restructuring charges were incurred.~~

During the three months ended July 31, 2017, we continued the implementation of the fiscal 2016 restructuring plan to integrate Legacy Hay entities that were acquired in fiscal 2016 and recorded $0.3 million of restructuring charges, net relating to the consolidation of premises.

~~Operating income decreased by $97.0 million~~2019 compared to an operating loss of $55.1 million in the ~~three months ended July 31, 2018 compared to an operating income of $41.9 million in the~~ year-ago quarter. The ~~decrease~~increase in operating income was primarily ~~due to~~driven by the write-off of tradenames of $106.6 million ~~an increase of $49.1 million~~ in ~~compensation~~the year-ago quarter and ~~benefits expense and $3.2 million more in legal and other professional expenses offset by~~ higher fee revenue of ~~$64.3 million.~~

Executive Search operating income increased $8.0 million, or 24%, to $40.9 million in the three months ended July 31, 2018 as compared to $32.9 million in the year-ago quarter. The increase in Executive Search operating income was driven by higher fee revenue of $31.7$18.9 million, offset by increases in compensation and benefits expense, marketing and ~~general~~business development expense and ~~administrative expenses~~premise and office expense.

Advisory operating income was $25.8 million in the three months ended July 31, 2019, an increase of ~~$21.5~~$108.9 million, or 131%, as compared to an operating loss of $83.1 million in the year-ago quarter. The change in operating income was primarily due to the tradename write-off of $106.6 million in the prior-year quarter and ~~$2.2 million, respectively. Executive Search~~a decrease in compensation and benefits expense. Advisory operating income, as a percentage of fee revenue, was ~~21% and 20% in the three months ended July 31, 2018 and 2017, respectively.~~

~~Advisory operating loss was $83.1 million in the three months ended July 31, 2018, a decrease of $102.2 million, as~~13% compared to operating income of $19.1 million in the year-ago quarter. The decrease in operating income was primarily due to the write-off of tradenames of $106.6 million and an increase of $11.6 million in compensation and benefits expense, offset by higher fee revenue of $15.9 million. Advisory operating loss, as a percentage of fee revenue, ~~was~~of 43% ~~in the three months ended July 31, 2018 compared to an operating income, as a percentage fee revenue, of 11%~~ in the year-ago quarter. Excluding the tradename write-offs, operating income as a percentage of fee revenue, was 12% in the three months ended July 31, 2018.

Executive Search operating income increased $4.7 million, or 11%, to $45.6 million in the three months ended July 31, 2019 as compared to $40.9 million in the year-ago quarter.The increase in Executive Search operating income was mainly driven by lower compensation and benefits expense. Executive Search operating income, as a percentage of fee revenue, was 24% and 21% in the three months ended July 31, 2019 and 2018, respectively.

RPO & Professional Search operating income was ~~$11.6~~$15.0 million, an increase of $3.4 million, or ~~41%~~29%, in the three months ended July 31, ~~2018~~2019 as compared to ~~$8.2~~$11.6 million in the year-ago quarter. The increase in operating income was mainly driven by higher fee revenue, ~~of $16.7 million,~~ offset by increases in compensation and benefits expense and ~~cost of services expense of $11.9 million~~general and ~~$1.2 million, respectively.~~administrative expenses. RPO & Professional Search operating income, as a percentage of fee revenue, was ~~15% in the three months ended July 31, 2018~~16% compared to ~~14%~~15% in the year-ago quarter.

Net income attributable to Korn Ferry ~~decreased~~increased by ~~$$67.6~~$81.6 million to $43.0 million in the three months ended July 31, 2019 as compared to a net loss of $38.6 million in the ~~three months ended July 31, 2018 as~~year-ago quarter. The increase was primarily due to lower general and administrative expenses of $102.9 million and a higher total revenue of $17.8 million, offset by an income tax provision of $14.5 million compared to a ~~net income attributable to Korn Ferry~~benefit of ~~$29.0~~$16.1 million, ~~in the year-ago quarter. The decrease was due to~~and an increase in ~~operating expenses of $160.5 million because of the intangible asset write-off of $106.6 million and higher~~ compensation and benefits expense of ~~$49.1 million, offset by higher total revenue of $63.5 million and an income tax benefit of $16.1~~$6.6 million during the three months ended July 31, ~~2018~~2019 compared to ~~income tax expense of $12.2 million in~~ the year-ago quarter. Net income attributable to Korn Ferry, as a percentage of fee revenue, was 9% in the three months ended July 31, 2019 as compared to net loss attributable to Korn Ferry, as a percentage of fee revenue, ~~was~~of 8% in the three months ended July 31, ~~2018 as compared to the net income attributable to Korn Ferry, as a percentage of fee revenue, of 7% in the three months ended July 31, 2017.~~2018.

Adjusted EBITDA increased by ~~$10.4~~$4.1 million to ~~$70.8~~$74.9 million in the three months ended July 31, ~~2018~~2019 as compared to ~~$60.4~~$70.8 million in the year-ago quarter. This increase was driven by higher fee revenue and a decrease in cost of ~~$64.3 million and an increase on other income, net of $1.1 million,~~services, offset by increases ~~of $48.6 million~~ in compensation and benefits expense (excluding integration costs), ~~$3.8 million in~~ general and administrative ~~expenses~~expense (excluding write-off ~~on tradenames)~~of trade names), and ~~an increase~~a decrease in other income, net due to lower gains generated from the change in the fair value of ~~$2.5 million in costs services expense.~~our marketable securities during the three months ended July 31, 2019 compared to the year-ago quarter. Adjusted EBITDA, as a percentage of fee revenue, was 15% in both the three months ended July 31, ~~2018~~2019 and ~~2017.~~2018.

~~Executive Search~~Advisory Adjusted EBITDA ~~increased $11.6 million, or 33%, to $46.8~~was $34.6 million in the three months ended July 31, ~~2018~~2019, an increase of $0.1 million, as compared to $35.2 million in the three months ended July 31, 2017. The increase was driven by higher fee revenue of $31.7 million and an increase in other income, net of $3.6 million during the three months ended July 31, 2018 compared to the year-ago quarter, offset by increases of $21.5 million in compensation and benefits expense and $2.2 million in general and administrative expenses. Executive Search Adjusted EBITDA, as a percentage of fee revenue, was 24% in the three months ended July 31, 2018 as compared to 22% in the three months ended July 31, 2017.

~~Advisory Adjusted EBITDA was~~ $34.5 million in the three months ended July 31, 2018, an increase of $4.1 million, or 13%, as compared to $30.4 million in the year-ago quarter. The increase was driven by higher fee revenue of $15.9 million, offset by increases of $11.1 million in compensation and benefits expense (excluding integration costs) and an increase of $1.1 million in cost of services expense during the three months ended July 31, 2018 compared to the year-ago quarter. Advisory Adjusted EBITDA, as a percentage of fee revenue, was 18% in both the three months ended July 31, ~~2018~~2019 and 2018.

Executive Search Adjusted EBITDA increased $2.1 million, or 4%, to $48.9 million in the three months ended July 31, 2019 as compared to ~~17%~~$46.8 million in the year-ago quarter. The increase was driven by decreases in compensation and benefits expense and general and administrative expenses, offset by a decrease in other income, net, during the three months ended July 31, 2019 compared to the year-ago quarter.Executive Search Adjusted EBITDA, as a percentage of fee revenue, was 25% in the three months ended July 31, 2019 as compared to 24% in the three months ended July 31, 2018.

RPO & Professional Search Adjusted EBITDA was ~~$12.5~~$16.1 million in the three months ended July 31, ~~2018,~~2019, an increase of ~~$3.5~~$3.6 million, or 29%, as compared to ~~$9.0~~$12.5 million in the year-ago quarter. The increase was driven by higher fee revenue, ~~of $16.7 million,~~ offset by increases ~~of $11.9 million~~ in compensation and benefits expense and ~~an increase of $1.2 million in cost of services expense~~general and administrative expenses during the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter. RPO & Professional Search Adjusted EBITDA, as a percentage of fee revenue, was ~~16%~~17% in the three months ended July 31, ~~2018~~2019 compared to ~~15%~~16% in the year-ago quarter.

Other income, net was ~~$4.5~~$1.8 million in the three months ended July 31, ~~2018 as~~2019 compared to ~~$3.4~~$4.5 million in the year-ago quarter. The ~~increase~~decrease was primarily due to ~~the change~~smaller gains in the fair value of our marketable securities ~~where there was a larger gain~~ during the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter.

Interest expense, net primarily relates to our ~~term loan facility~~credit agreement and borrowings under ~~our~~ COLI policies, which isare partially offset by interest earned on cash and cash equivalent balances. Interest expense, net was $4.1 million in both the three months ended July 31, ~~2018 as compared to $3.7 million in the year-ago quarter.~~2019 and 2018.

The provision for income tax was ~~a benefit of $16.1~~$14.5 million in the three months ended July 31, ~~2018~~2019 compared to ~~an expense~~a benefit of ~~$12.2~~$16.1 million in the year-ago quarter. This reflects a ~~29.4%~~24.9% (provision) and ~~29.3%~~a 29.5% (benefit) effective tax rate for the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, respectively. The Company’s effective tax rate was ~~29.4%~~24.9% (provision) for the three months ended July 31, 2019 compared to the U.S. federal statutory rate of 21.0%. This difference is primarily due to U.S. state income taxes and taxable income outside the U.S. that is subject to higher statutory tax rates, partially offset by an excess tax benefit recorded in connection with stock-based awards that vested in the current quarter, which was recorded discrete to the current quarter. The Company’s effective tax rate was 29.5% (benefit) for the three months ended July 31, 2018 compared to the U.S. federal statutory rate of 21.0%. This difference is primarily due to the trademark ~~impairment charge~~write-offs and the excess tax benefit on vested stock-based awards, both of which were recorded as discrete to the ~~current quarter. The Company’s effective tax rate for the~~ three months ended July 31, 2017 was lower than the then U.S. federal statutory rate of 35.0% due principally to the Company’s earnings outside the United States which were generally taxed at rates lower than the then applicable U.S. federal rate.2018.

Net income attributable to noncontrolling interest represents the portion of a subsidiary’s net earnings that are attributable to shares of a subsidiary not held by Korn Ferry that are included in the consolidated results of operations. Net income attributable to noncontrolling interest for the three months ended July 31, ~~2018~~2019 was ~~minimal~~$0.7 million as compared to ~~$0.4 million~~a minimal amount for the three months ended July 31, ~~2017.~~2018.

The Company and its Board of Directors endorse a balanced approach to capital allocation. The Company’s priority is to invest in growth initiatives, such as the hiring of consultants, the continued development of IP and derivative products and services, and the investment in synergistic, accretive merger and acquisition transactions that earn a return that is superior to the Company's cost of capital. Next, the Company’s capital allocation approach contemplates the return of a portion of excess capital to stockholders, in the form of a regular quarterly dividend, subject to the factors discussed below and in the “Risk Factors” section of the Annual Report on Form 10-K for the fiscal year ended April 30, ~~2018.~~2019. Additionally, the Company considers share repurchases on an opportunistic basis and subject to the terms of our ~~credit agreement.~~Credit Agreement (defined below).

On ~~June 15, 2016,~~December 19, 2018, we entered into a senior secured ~~$400~~$650.0 million Amended and Restated Credit Agreement (the “Credit Agreement”) with a syndicate of banks and Wells Fargo Bank, National Association as administrative agent to among other things, provide for enhanced financial ~~flexibility and in recognition of the accelerated pace of integrating a previous acquisition.~~flexibility. See Note ~~10—~~11—Long-Term Debtfor a description of the ~~credit facility. In anticipation of the Plan, on June 8, 2018, we entered into an amendment (the “Amendment”) to the~~ Credit Agreement. The Amendment permits the KF Merger and would become effective when certain conditions set forth therein, including consummation of the KF Merger, were satisfied. We previously considered pursuing a holding company reorganization. We continue to pursue the Plan and are further evaluating various other structuring alternatives to effectuate the Plan but may not do so via the KF Merger structure previously disclosed.

We drew down ~~$275~~$226.9 million on the ~~term loan~~Revolver (defined below) and used ~~$140 million of~~ the proceeds to pay-off the term loan under our prior credit facility that was outstanding as of ~~April 30, 2016.~~December 19, 2018. We have $419.9 million available under the Revolver after we drew down $226.9 million and after $3.2 million of standby letters of credit were issued as of July 31, 2019. We had $3.2 million and $2.9 million in standby letters of credit issued under our long-term debt arrangements as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. We had a total of ~~$7.9~~$8.9 million and ~~$7.4~~$8.5 million of standby letters of credits with other financial institutions as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. The standby letters of credits were generally issued as a result of entering into office premise leases.

As part of a previous acquisition, the Company committed to a $40 million retention pool (of which $23.5 million has been paid) for certain employees of the previous acquired company subject to certain circumstances. The remaining balance will be payable within 45 days after November 30, 2018.

The Board of Directors has adopted a dividend policy to distribute to our stockholders a regular quarterly cash dividend of $0.10 per share. Every quarter since the adoption of the dividend policy, the Company has declared a quarterly dividend. The declaration and payment of future dividends under the quarterly dividend program will be at the discretion of the Board of Directors and will depend upon many factors, including our earnings, capital requirements, financial conditions, the terms of our indebtedness and other factors our Board of Directors may deem to be relevant. Our Board of Directors may, however, amend, revoke or suspend our dividend policy at any time and for any reason.

~~The~~On March 6, 2019, our Board of Directors ~~also~~ approved an increase to the ~~Company’s stock~~share repurchase program of approximately $200 million, which brings our available capacity to ~~an aggregate of $150.0 million. Common stock may be repurchased from time to time~~repurchase shares in the open market or privately negotiated transactions atto approximately $250 million. The Company repurchased approximately $12.7 million of the Company’s ~~discretion subject to market conditions and other factors.~~stock during the three months ended July 31, 2019, leaving $238.0 million remaining under our share repurchase program. No shares were repurchased by the Company during the three months ended July ~~30, 2018 as compared to repurchasing approximately $4.0 million of the Company’s stock during the three months ended July~~ 31, ~~2017. As of July 31, 2018, $88.1 million remained available for common stock repurchases under our stock repurchase program.~~2018. Any decision to continue to execute our currently outstanding share repurchase program will depend on our earnings, capital requirements, financial condition and other factors

considered relevant by our Board of Directors. ~~Our senior secured credit agreement requires that~~The Credit Agreement permits us to pay dividends to our stockholders and make share repurchases so long as our pro forma net leverage ratio, defined as, the ratio of consolidated funded indebtedness minus up to $50 million of unrestricted cash and cash equivalents of the Company and domestic subsidiaries to consolidated Adjusted EBITDA, is no greater than ~~2.50~~3.25 to 1.00, and our pro forma domestic liquidity is at least $50.0 million, including ~~undrawn amounts on our~~the revolving credit ~~facility as a condition to consummating permitted acquisitions, paying dividends to our stockholders~~commitment minus amounts outstanding on the Revolver, issued letters of credit and ~~share repurchases of our common stock.~~swing loans.

Our performance is subject to the general level of economic activity in the geographic regions and the industries ~~which~~ we service. We believe, based on current economic conditions, that our cash on hand and funds from operations and the Credit Agreement ~~we entered into on June 15, 2016~~ will be sufficient to meet anticipated working capital, capital expenditures,general corporate requirements, repayment of the debt, ~~incurred in connection with the previous acquisition, the retention pool obligations in connection with the previous acquisition,~~ share repurchases and dividend payments under our dividend policy during the next twelve months. However, if the national or global economy, credit market conditions and/or labor markets were to deteriorate in the future, such changes could put negative pressure on demand for our services and affect our operating cash flows. If these conditions were to persist over an extended period of time, we may incur negative cash flows and it might require us to access ~~our existing credit facility~~additional borrowings under the Credit Agreement to meet our capital needs and/or discontinue our share repurchases and dividend policy.

Cash and cash equivalents and marketable securities were ~~$499.8~~$567.3 million and ~~$657.9~~$767.1 million as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively.Net of amounts held in trust for deferred compensation plans and accrued bonuses, cash and marketable securities were ~~$295.5~~$362.6 million and ~~$312.4~~$382.1 million at July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, we held ~~$217.6~~$272.2 million and ~~$207.6~~$267.0 million, respectively of cash and cash equivalents in foreign locations, net of amounts held in trust for deferred compensation plans and to pay fiscal ~~2019~~2020 and ~~2018~~2019 annual bonuses. Cash and cash equivalents consist of cash and highly liquid investments purchased with original maturities of three months or less. Marketable securities consist of mutual funds. The primary objectives of our investment in mutual funds are to meet the obligations under certain of our deferred compensation plans.

As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, marketable securities of ~~$134.1~~$142.7 million (net of gross unrealized gains of ~~$10.4~~$7.2 million and gross unrealized losses of ~~$0.9~~$0.8 million) and ~~$137.1~~$140.8 million (net of gross unrealized gains of ~~$11.0~~$6.3 million and gross unrealized losses of $1.0 million), respectively, were held in trust for settlement of our obligations under certain deferred compensation plans, of which ~~$123.1~~$134.1 million and ~~$122.8~~$132.5 million, respectively, are classified as non-current. These marketable securities were held to satisfy vested obligations totaling ~~$125.4~~$133.7 millionand ~~$118.2~~$122.3 million as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. Unvested obligations under the deferred compensation plans totaled ~~$19.1~~$17.3 million and ~~$29.5~~$24.6 million as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively.

The net ~~increase~~decrease in our working capital of ~~$14.5~~$22.4 million as of July 31, ~~2018~~2019 compared to April 30, ~~2018~~2019 is primarily attributable to a decrease in cash and cash equivalents and an increase in operating lease liability, current as a result the implementation of the new lease accounting standard, offset by a decrease in compensation and benefits payable and an increase in accounts ~~receivable, offset by decreases in cash and cash equivalents.~~receivable. The decrease in cash and cash equivalents and compensation and benefits payable was primarily due to the payment of annual bonuses earned in fiscal ~~2018~~2019 and paid during the first quarter of fiscal ~~2019, with cash and cash equivalents also decreasing due to sign-on and retention payments made during the quarter.~~2020. The increase in accounts receivable was due to an increase in days of sales outstanding which went from 5861 days to 6569 days (which is consistent with historical experience) from April 30, ~~2018~~2019 to July 31, ~~2018.~~2019. Cash used by operating activities was $161.9 million in the three months ended July 31, 2019, an increase of $44.4 million, compared to $117.5 million in thethree months ended July 31, 2018.

Cash used in investing activities was $9.2 million in the three months ended July 31, ~~2018, an increase of $7.9 million,~~2019 compared to ~~$109.6~~$6.6 million in the year-ago quarter.

~~Cash~~ An increase in cash used in investing activities was ~~$6.6 million in the three months ended July 31, 2018 compared to $11.8 million in the year-ago quarter. Cash used in investing activities was lower~~primarily due to ~~an increase in~~a decrease of proceeds from sales/maturities of marketable securities, ~~net of cash used to purchase marketable securities,~~ offset by ~~higher~~lower cash used for the purchases of property and equipment and an increase in proceeds received from life insurance proceeds during the three months ended July 31, ~~2018~~2019 compared to the year-ago quarter.

Cash used in financing activities was $24.9 million in the three months ended July 31, 2019 compared to $20.6 million in the three months ended July 31, ~~2018 compared~~2018.The increase in cash used in financing activities was primarily due to ~~$15.3~~the repurchase of common stock of $12.7 million in the three months ended July 31, ~~2017. The change was primarily due~~2019 compared to ~~an increase~~no repurchase in the year-ago quarter, offset by a decrease in cash used to make principal payments on term loan of ~~$9.7~~$5.2 million inand lower cash used to repurchase shares of common stock to satisfy tax withholding requirements upon the vesting of restricted stock ~~offset by a decrease in shares repurchased under the stock repurchase program~~ of ~~$4.0~~$4.5 million in the three months ended July 31, ~~2018~~2019 compared to the year-ago ~~period.~~quarter.

Cash Surrender Value of ~~Company Owned~~Company-Owned Life Insurance Policies, Net of Loans

~~The Company~~We purchased COLI policies or contracts insuring the lives of certain employees eligible to participate in the deferred compensation and pension plans as a means of funding benefits under such plans. As of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, we held contracts with gross CSV of ~~$188.5~~$219.1 million and ~~$186.8~~$219.2 million, respectively. Total outstanding borrowings against the CSV of COLI contracts were ~~$66.7~~$92.3 million and $93.2 million as of July 31, ~~2018~~2019 and April 30, ~~2018.~~2019, respectively. Such borrowings do not require annual principal repayments, bear interest primarily at variable rates and are secured by the CSV of COLI contracts. At July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, the net cash value of these policies was ~~$121.8~~$126.8 million and ~~$120.1~~$126.0 million, respectively.

On ~~June 15, 2016,~~December 19, 2018, we entered into ~~a senior secured $400 million~~the Credit Agreement (the “Credit Agreement”) with a syndicate of banks and Wells Fargo Bank, National Association as administrative agent. On June 8, 2018, in anticipation of the approval by the Board of Directors of the Company of a rebranding and restructuring plan (which plan was approved on June 12, 2018), we entered into an amendment to our Credit Agreement. The Amendment permits a holding company reorganization (the “KF Merger”), after which a new public holding company, Korn Ferry, would own all of the stock of the Company, and would

become effective when certain conditions set forth therein, including consummation of the KF Merger, were satisfied. We previously considered pursuing a holding company reorganization. We continue to pursue the Plan and are further evaluating variousamong other ~~structuring alternatives to effectuate the Plan but may not do so via the KF Merger structure previously disclosed.~~things, provide for enhanced financial flexibility. The Credit Agreement provides for, among other things: (a) a ~~senior secured term loan facility in an aggregate principal amount of $275~~$650.0 million ~~(the “ Term Facility”), (b) a~~five-year senior secured revolving credit facility (the “Revolver”) and together with the Term Facility, the “Credit Facilities”) in an aggregate principal amount of $125 million, (c) annual term loan amortization of 7.5%, 7.5%, 10.0%, 10.0% and 10.0%, with the remaining principal due at maturity, (d)(b) certain customary affirmative and negative covenants, including a maximum consolidated total leverage ratio (as defined below) and a minimum interest coverage ~~ratio and (e) an expanded definition of permitted add-backs to Adjusted EBITDA in recognition of the accelerated integration actions.~~ratio. Our ~~credit agreement~~Credit Agreement permits payment of dividends to stockholders and share repurchases so long as the pro forma net leverage ratio is no greater than ~~2.50~~3.25 to 1.00, and the pro forma domestic liquidity is at least $50.0 million.We drew down ~~$275~~$226.9 million on the ~~term loan~~Revolver and used ~~$140 million of~~ the proceeds to pay-off the term loan that was outstanding as of ~~April 30, 2016.~~December 19, 2018. The pay-off of term loan outstanding under our prior credit facility and draw-down on the Revolver is considered a debt modification and therefore, the previously incurred unamortized and current debt issuance costs will be amortized over the life of the new issuance.

The principal balance of the Revolver is due on the date of its termination. The Revolver matures on December 19, 2023 and any unpaid principal balance is payable on this date. The Revolver may also be prepaid and terminated early by us at any time without premium or penalty (subject to customary LIBOR breakage fees).

At our option, loans issued under the Credit Agreement will bear interest at either LIBOR or an alternate base rate, in each case plus the applicable interest rate margin. The interest rate applicable to loans outstanding under the Credit ~~Facilities~~Agreement may fluctuate between LIBOR plus 1.25% per annum to LIBOR plus 2.00% per annum, in the case of LIBOR borrowings (or between the alternate base rate plus 0.25% per annum and the alternate base rate plus 1.00% per annum, in the alternative), based upon our total funded debt to ~~adjusted~~Adjusted EBITDA ratio (as set forth in the Credit Agreement, the “consolidated leverage ratio”) at such time. In addition, we will be required to pay to the lenders a quarterly commitment fee ranging from 0.20% to 0.35% per annum on the average daily unused amount of the ~~Term Facility,~~Revolver, based upon our consolidated leverage ratio at such time, and fees relating to the issuance of letters of credit. During the three months ended July 31, ~~2018~~2019 and ~~2017,~~2018, the average interest rate on ~~the Term Facility~~our long-term debt arrangements was ~~3.24%~~3.69% and ~~2.34%~~3.24%, respectively.

Both the Revolver and the Term Facility mature on June 15, 2021 and may be prepaid and terminated early by us at any time without premium or penalty (subject to customary LIBOR breakage fees). The Term Facility is payable in quarterly installments with principal payments totalling $5.2 million made during the three months ended July 31, 2018. As of July 31, ~~2018, $233.7~~2019 and April 30, 2019, $226.9 million was outstanding under the ~~Term Facility compared to $238.9 million as of April 30, 2018.~~Revolver. The ~~current and long-term portion of~~ unamortized debt issuance costs associated with the long-term debt ~~was $2.4~~were $3.8 million and ~~$2.7~~$4.0 million as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. The fair value of our ~~Term Facility~~Revolver is based on borrowing rates currently required of loans with similar terms, maturity and credit risk. The carrying amount of the ~~Term Facility~~Revolver approximates fair value because the base interest rate charged varies with market conditions and the credit spread is commensurate with current market spreads for issuers of similar risk. The fair value of the ~~Term Facility~~Revolver is classified as a Level 2 liability in the fair value hierarchy. As of July 31, ~~2018,~~2019, we were in compliance with our debt covenants.

~~As of July 31, 2018 and April 30, 2018, we had no borrowings under the Revolver. The Company~~We had a total of ~~$122.1~~$419.9 million available under the Revolver after ~~$2.9~~we drew down $226.9 million and after $3.2 million of standby letters of credit were issued as of July 31, ~~2018 and April 30, 2018.~~2019. We had a total of ~~$7.9~~$420.2 million available under the Revolver after we drew down $226.9 million and ~~$7.4~~after $2.9 million of standby letters of credit were issued as of April 30, 2019. We had a total of $8.9 million and $8.5 million of standby letters of credits with other financial institutions as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively. The standby letters of credits were generally issued as a result of entering into office premise leases.

We are not aware of any other trends, demands or commitments that would materially affect liquidity or those that relate to our ~~resources.~~resources as of July 31, 2019.

We have no off-balance sheet arrangements and have not entered into any transactions involving unconsolidated, special purpose entities. We had no material changes in contractual obligations as of July 31, ~~2018,~~2019, as compared to those disclosed in our table of contractual obligations included in our Annual Report.

Preparation of this Quarterly Report on Form 10-Q requires us to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of our financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates and assumptions and changes in the estimates are reported in current operations as new information is learned or upon the amounts becoming fixed ~~and~~or determinable. In preparing our interim consolidated financial statements and accounting for the underlying transactions and balances, we apply our accounting policies as disclosed in the notes to our consolidated financial statements. We consider the policies related to revenue recognition, performance related bonuses, deferred compensation, carrying values of receivables, goodwill, intangible assets and recoverability of deferred income taxes as critical to an understanding of our interim consolidated financial statements because their application places the most significant demands on management’s judgment and estimates. Specific risks for these critical accounting policies are described in our Form 10-K filed with the Securities Exchange Commission. ~~During the three months ended July 30, 2018, we implemented the new~~

~~revenue standard (ASU 2014-09), which superseded revenue recognition requirements regarding contracts with customers to transfer goods or services or for the transfer of nonfinancial assets.~~

Substantially all fee revenue is derived from fees for professional services related to executive and professional recruitment performed on a retained basis, recruitment process outsourcing, talent and organizational advisory services and the sale of products, standalone or as part of a solution.

~~Revenue is recognized when control of the goods and services are transferred to the customer,~~There have been no material changes in an amount that reflects the consideration we expect to be entitled to in exchange for those goods and services. Revenue contracts with customers are evaluated based on the five-step model outlined in the Accounting Standard Codification 606 (“ASC 606”): 1) identify the contract with a customer; 2) identify the performance obligation(s) in the contract; 3) determine the transaction price; 4) allocate the transaction price to the separate performance obligation(s); and 5) recognize revenue when (or as) each performance obligation is satisfied.our critical accounting policies since fiscal 2019.

~~Fee revenue from executive search and non-executive professional activities is generally one-third of the estimated first year compensation of the placed candidate plus a percentage of the fee to~~ ~~cover~~ indirect engagement related expenses. In addition to the search retainer, an uptick fee is billed when the actual compensation awarded by the client for a placement is higher than the estimated compensation. In the aggregate upticks are a relatively consistent percentage of the original estimated fee therefore we estimate upticks using the expected value method based on historical data on a portfolio basis. In a standard search engagement, there is one performance obligation which is the promise to undertake a search. We generally recognize such revenue over the course of a search and when it is legally entitled to payment as outlined in the billing terms of the contract. Any revenues associated with services that are provided on a contingent basis are recognized once the contingency is resolved as this is when control is transferred to the customer. These assumptions determine the timing of revenue recognition for the reported period.

RPO fee revenue is generated through two distinct phases 1) the implementation phase and 2) post-implementation recruitment phase. The fees associated with the implementation phase are recognized over the period that the related Implementation services are provided. The post-implementation recruitment phase represents end-to-end recruiting services to clients for which there are both fixed and variable fees, which are recognized over the period that the related recruiting services are performed.

Product revenue is generated from a range of online tools designed to support human resource processes for pay, talent and engagement, assessments, as well as licenses to proprietary IP and tangible/digital products. IP subscriptions grant access to proprietary compensation and job evaluation databases. IP subscriptions are considered symbolic IP due to the dynamic nature of the content and, as a result, revenue is recognized over the term of the contract. Functional IP licenses grant customers the right to use IP content via delivery of a flat file. Because the IP content license has significant standalone functionality, revenue is recognized upon delivery and when an enforceable right to payment exists.~~Online assessments are delivered in the form of online questionnaires.A bundle of assessments represents one performance obligation, and revenue is recognized as assessment services are delivered and we have a legally enforceable right to payment.~~ Tangible/Digital products sold by us mainly consist of books and digital files covering a variety of topics including performance management, team effectiveness, and coaching and development. We recognize revenue for its products when sold or shipped as in the case for books.

As a result of our global operating activities, we are exposed to certain market risks, including foreign currency exchange fluctuations and fluctuations in interest rates. We manage our exposure to these risks in the normal course of our business as described below.

Substantially all our foreign subsidiaries’ operations are measured in their local currencies. Assets and liabilities are translated into U.S. dollars at the rates of exchange in effect at the end of each reporting period, and revenue and expenses are translated at average rates of exchange during the reporting period. Resulting translation adjustments are reported as a component of accumulated other comprehensive loss, net on our consolidated balance sheets.

Transactions denominated in a currency other than the reporting entity’s functional currency may give rise to foreign currency gains or losses that impact our results of operations. Historically, we have not realized significant foreign currency gains or

losses on such transactions. ~~Foreign currency losses, on an after tax basis, included in net loss were $0.7 million in~~During the three months ended July 31, 2019 and 2018, ~~as compared to $1.0~~we recorded foreign currency losses of $0.7 million ~~included net income~~and $0.9 million, respectively, in general and administrative expenses in the ~~three months ended July 31, 2017.~~consolidated statements of operations.

Our exposure to foreign currency exchange rates is primarily driven by fluctuations involving the following currencies –— U.S. Dollar, Pound Sterling, Euro, Swiss Franc, Canadian Dollar, ~~Euro, Pound Sterling, Swiss Franc, Korean Won,~~Singapore Dollar, Brazilian Real ~~Singapore Dollar, Mexican Peso,~~and Indonesian ~~Rupiah and Indian Rupee.~~Rupiah. Based on balances exposed to fluctuation in exchange rates between these currencies as of July 31, ~~2018,~~2019, a 10% increase or decrease equally in the value of these currencies could result in a foreign exchange gain or loss of ~~$9.7~~$10.4 million. We have a program that primarily utilizes foreign currency forward contracts to offset the risks associated with the effects of certain foreign currency exposures. These foreign currency forward contracts are neither used for trading purposes nor are they designated as hedging instruments pursuant to Accounting Standards Codification 815, Derivatives and Hedging.

Our exposure to interest rate risk is limited to our ~~Term Facility~~Revolver and borrowings against the CSV of COLI contracts. As of July 31, ~~2018,~~2019, there was ~~$233.7~~$226.9 million outstanding under the ~~Term Facility.~~Revolver. At our option, loans issued under the Credit ~~Facilities~~Agreement bear interest at either LIBOR or an alternate base rate, in each case plus the applicable interest rate margin. The interest rate applicable to loans outstanding under the Credit ~~Facilities~~Agreement may fluctuate between LIBOR plus 1.25% per annum to LIBOR plus 2.00% per annum, in the case of LIBOR borrowings (or between the alternate base rate plus 0.25% per annum and the alternate base rate plus 1.00% per annum, in the alternative), based upon our total funded debt to ~~adjusted~~Adjusted EBITDA ratio (as set forth in the Credit Agreement, the “consolidated net leverage ratio”) at such time. In addition, we are required to pay the lenders a quarterly fee ranging from 0.20% to 0.35% per annum on the average daily unused amount of the Term Facility, based upon our consolidated leverage ratio at such time, and fees relating to the issuance of letters of credit. A ~~100 basis~~100-basis point increase in LIBOR rates would have increased our interest expense by approximately $0.6 million for the three months ended July 31, 2019 and July 31, 2018. During the three months ended July 31, ~~2018~~2019 and ~~2017,~~July 31, 2018, the average interest rate on the previous term loan was ~~3.24%~~3.69% and ~~2.34%~~3.24%, respectively. ~~We had no borrowings under the Revolver as of July 31, 2018.~~

To mitigate ~~the~~this interest rate risk, ~~on our Term Facility,~~ we entered into an interest rate swap contract in March 2017 with an initial notional amount of $129.8 million to hedge the variability to changes in cash flows attributable to interest rate risks caused by changes in interest rates related to our variable rate debt. We have designated the swap as a cash flow hedge. ~~The notional amount is amortized so that the amount is always 50% of the principal balance of the debt outstanding.~~ As of July 31, ~~2018,~~2019, the notional amount was ~~$116.9~~$103.1 million. The interest rate swap agreement matures on June 15, 2021 and locks the interest rates on ~~50%~~a portion of our outstanding debt at 1.919%, exclusive of the credit spread on the debt.

We had ~~$66.7~~$92.3 million and $93.2 million of borrowings against the CSV of COLI contracts as of July 31, ~~2018~~2019 and April 30, ~~2018,~~2019, respectively, bearing interest primarily at variable rates. The risk of fluctuations in these variable rates is minimized by the fact that we receive a corresponding adjustment to our borrowed funds crediting rate which has the effect of increasing the CSV on our COLI contracts.

Based on their evaluation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) conducted as of the end of the period covered by this Quarterly Report on Form 10-Q, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) ~~are~~were effective.

There were no changes in our internal control over financial reporting during the three months ended July 31, ~~2018~~2019 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

From time to time, we are involved in litigation both as a plaintiff and a defendant, relating to claims arising out of our operations. As of the date of this report, we are not engaged in any legal proceedings that are expected, individually or in the aggregate, to have a material adverse effect on our business, financial condition or results of operations.

In our Form 10-K for the year ended April 30, ~~2018,~~2019, we described material risk factors facing our business. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. As of the date of this report, there have been no material changes to the risk factors described in our Form 10-K.

Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuers Purchases of Equity Securities

The following table summarizes common stock repurchased by us during the quarter ended July 31, ~~2018:~~2019:

Our ~~senior secured credit agreement,~~Credit Agreement, dated ~~June 15, 2016,~~December 19, 2018, permits us to pay dividends to our stockholders and make share repurchases so long as our pro forma net leverage ratio, defined as, the ratio of consolidated funded indebtedness minus up to $50 million of unrestricted cash and cash equivalents of the Company and domestic subsidiaries to consolidated ~~adjusted~~Adjusted EBITDA, is no greater than ~~2.50~~3.25 to 1.00, and our pro forma domestic liquidity is at least $50.0 ~~million.~~million, including the revolving credit commitment minus amounts outstanding on the revolver, issued letters of credit and swing loans.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Delaware		95-2623879
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share	KFY	New York Stock Exchange

Large accelerated filer ☑		Accelerated filer ☐

Non-accelerated filer ☐	~~(Do not check if a smaller reporting company)~~	Smaller reporting company ☐
		Emerging growth company ☐

Item #	Description	Page

	Part I. Financial Information

Item 1.	Consolidated Financial Statements

	Consolidated Balance Sheets as of July 31, ~~2018~~2019 (unaudited) and April 30, ~~2018~~2019	1

	Consolidated Statements of Operations (unaudited) for the three months ended July 31, ~~2018~~2019 and ~~2017~~2018	2

	Consolidated Statements of Comprehensive Income ~~(Loss)~~ (unaudited) for the three months ended July 31, ~~2018~~2019 and ~~2017~~2018	3

	Consolidated Statements of Stockholders’ Equity (unaudited) for ~~the~~ three months ended July 31, ~~2018~~2019 and ~~2017~~2018	4

	Consolidated Statements of Cash Flows (unaudited) for the three months ended July 31, ~~2018~~2019 and ~~2017~~2018	5

	Notes to Consolidated Unaudited Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2223

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3334

Item 4.	Controls and Procedures	3435

	Part II. Other Information

Item 1.	Legal Proceedings	3536

Item 1A.	Risk Factors	3536

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities	3536

Item 6.	Exhibits	3637

	Signatures	3738

	Three Months Ended July 31,
	2018			2017
	(in thousands)
Net (loss) income	$	(38,592	)	$	29,429

Other comprehensive (loss) income:
Foreign currency translation adjustments		(14,556	)		16,189
Deferred compensation and pension plan adjustments, net of tax		273			352
Net unrealized gain (loss) on interest rate swap, net of tax		133			(63	)
Comprehensive (loss) income		(52,742	)		45,907
Less: comprehensive income attributable to noncontrolling interest		(25	)		(493	)
Comprehensive (loss) income attributable to Korn/Ferry International	$	(52,767	)	$	45,414

										Accumulated			Total
										Other			Korn/Ferry
										Comprehensive			International					Total
	Common Stock						Retained			(Loss) Income,			Stockholders'			Noncontrolling		Stockholder's
	Shares			Amount			Earnings			Net			Equity			Interest		Equity
	(in thousands)
Balance as of April 30, 2018		56,517		$	683,942		$	572,800		$	(40,135	)	$	1,216,607		$	3,008	$	1,219,615
Net loss		—			—			(38,611	)		—			(38,611	)		19		(38,592	)
Other Comprehensive (loss) income		—			—			—			(14,156	)		(14,156	)		6		(14,150	)
Effect of adopting new accounting standards		—			—			8,853			(2,197	)		6,656			—		6,656
Dividends paid to shareholders		—			—			(6,027	)		—			(6,027	)		—		(6,027	)
Purchase of stock		(200	)		(13,055	)		—			—			(13,055	)		—		(13,055	)
Issuance of stock		621			4,804			—			—			4,804			—		4,804
Stock-based compensation		—			5,369			—			—			5,369			—		5,369
Balance as of July 31, 2018		56,938		$	681,060		$	537,015		$	(56,488	)	$	1,161,587		$	3,033	$	1,164,620

			Adjustments
	April 30, 2018		due to ASC 606			May 1, 2018
	(in thousands)
Total assets	$	2,287,914	$	3,496		$	2,291,410
Total liabilities	$	1,068,299	$	(3,160	)	$	1,065,139
Total stockholders’ equity	$	1,219,615	$	6,656		$	1,226,271

	Foreign Currency Translation			Deferred Compensation and Pension Plan (1)			Unrealized gains on interest rate swap (2)			Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance as of April 30, 2018	$	(32,399	)	$	(9,073	)	$	1,337		$	(40,135	)
Unrealized (losses) gains arising during the period		(14,562	)		—			149			(14,413	)
Reclassification of realized net losses (gains) to net (loss) income		—			273			(16	)		257
Effect of adoption of accounting standard		—			(2,396	)		199			(2,197	)
Balance as of July 31, 2018	$	(46,961	)	$	(11,196	)	$	1,669		$	(56,488	)

	Foreign Currency Translation			Deferred Compensation and Pension Plan (1)			Unrealized (losses) on interest rate swap (2)			Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance as of April 30, 2017	$	(55,359	)	$	(15,127	)	$	(578	)	$	(71,064	)
Unrealized gains (losses) arising during the period		16,084			—			(234	)		15,850
Reclassification of realized net losses to net income		—			352			171			523
Balance as of July 31, 2017	$	(39,275	)	$	(14,775	)	$	(641	)	$	(54,691	)

	Foreign Currency Translation			Deferred Compensation and Pension Plan (1)			Unrealized (Losses) Gains on Interest Rate Swap (2)			Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance as of April 30, 2019	$	(60,270	)	$	(16,838	)	$	456		$	(76,652	)
Unrealized losses arising during the period		(5,362	)		—			(491	)		(5,853	)
Reclassification of realized net losses (gains) to net income		—			495			(104	)		391
Balance as of July 31, 2019	$	(65,632	)	$	(16,343	)	$	(139	)	$	(82,114	)

	Three Months Ended July 31, 2019
	(in thousands)
Finance lease cost
Amortization of ROU assets	$	470
Interest on lease liabilities		40
		510
Operating lease cost		14,227
Short-term lease cost		279
Variable lease cost		2,893
Sublease income		(54	)
Total lease cost	$	17,855

	Three Months Ended July 31, 2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	14,909
Financing cash flows from finance leases	$	432

ROU assets obtained in exchange for lease obligations:
Operating leases	$	935
Finance leases	$	513

	Three Months Ended July 31, 2019
	(in thousands)
Finance Leases:

Property and equipment, at cost	$	4,519
Accumulated depreciation		(473	)
Property and equipment, net	$	4,046

Other accrued liabilities		1,715
Other liabilities		2,366
Total finance lease liabilities	$	4,081

Weighted average remaining lease terms:
Operating leases	6.2 years
Finance leases	2.8 years

Weighted average discount rate:
Operating leases		4.8	%
Finance leases		4.1	%

Year Ending April 30,	Operating		Financing
	(in thousands)
2020 (excluding the three months ended July 31, 2019)	$	44,919	$	1,438
2021		54,799		1,462
2022		47,188		984
2023		40,144		326
2024		34,803		112
Thereafter		74,369		—
Total lease payments		296,222		4,322
Less: imputed interest		41,765		241
Total	$	254,457	$	4,081

Organizational Strategy	We map talent strategy to business strategy by designing operating models and organizational structures that align to them, helping organizations put their plans into action. We make sure they have the right people, in the right roles, engaged and enabled to do the right things.
Assessment and Succession	We provide actionable, research-backed insights that allow organizations to understand the true capabilities of their people so they can make decisions that ensure the right leaders are ready—when and where they are needed—in the future.
Talent Acquisition	From executive search to ~~recruitment process outsourcing,~~RPO, we integrate scientific research with our practical experience and industry-specific expertise to recruit professionals of all levels and functions for client organizations.
Leadership Development	We ~~activate purpose, vision and strategy through~~help leaders at all levels of an organization achieve their vision, purpose and ~~organizations.~~strategy. We combine expertise, science and proven techniques with forward thinking and creativity to build leadership experiences that help entry- to senior-level leaders grow and deliver superior results.
Rewards and Benefits	We help organizations ~~align reward with strategy.~~design rewards to achieve their strategic objectives. We help them pay their people fairly for doing the right things—with rewards they value—at a cost the organization can afford.

	Shares Purchased (1)		Average Price Paid Per Share		Shares Purchased as Part of Publicly- Announced Programs (2)		Approximate Dollar Value of Shares That May Yet be Purchased Under the Programs (2)

May 1, 2019 — May 31, 2019		891	$	46.34		—	$250.7 million
June 1, 2019— June 30, 2019		720	$	45.73		—	$250.7 million
July 1, 2019— July 31, 2019		544,143	$	39.06		324,100	$238.0 million
Total		545,754	$	39.08		324,100

Exhibit Number		Description
3.1*		Certificate of Amendment of Restated Certificate of Incorporation of the Company, effective January 1, 2019, filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed December 13, 2018.
3.2*		Seventh Amended and Restated Bylaws, effective January 1, 2019, filed as Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed December 13, 2018.
3.3*		Restated Certificate of Incorporation of the Company, effective January 7, 2019, filed as Exhibit 3.3 to the Company’s Quarterly Report on Form 10-Q, filed March 11, 2019.
31.1		Chief Executive Officer Certification pursuant to Rule 13a-14(a) under the Exchange Act.
31.2		Chief Financial Officer Certification pursuant to Rule 13a-14(a) under the Exchange Act.
32.1		Chief Executive Officer and Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350.
101.INS		Inline XBRL Instance ~~Document.~~Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document.
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2019, has been formatted in Inline XBRL.

~~Korn/~~Korn Ferry ~~International~~

By:		/s/ Robert P. Rozek
		Robert P. Rozek
		Executive Vice President, Chief Financial Officer and Chief Corporate Officer (Duly Authorized Officer, Principal Financial Officer and Principal Accounting Officer)