Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Mar. 31, 2017 | Apr. 28, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Entity Registrant Name | AUTOMATIC DATA PROCESSING INC | |
Entity Central Index Key | 8,670 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Large Accelerated Filer | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Entity Common Stock, Shares Outstanding | 447,410,344 |
Statements of Consolidated Earn
Statements of Consolidated Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
REVENUES: | |||||
Revenues, other than interest on funds held for clients and PEO revenues | $ 2,329.8 | $ 2,283.8 | $ 6,444.4 | $ 6,196.6 | |
Interest on funds held for clients | 111.6 | 102.8 | 292.6 | 280 | |
PEO revenues (A) | [1] | 969.4 | 862 | 2,577.9 | 2,292.9 |
TOTAL REVENUES | 3,410.8 | 3,248.6 | 9,314.9 | 8,769.5 | |
Costs of revenues: | |||||
Operating expenses | 1,701.5 | 1,611.6 | 4,793.4 | 4,530.9 | |
Systems development and programming costs | 153.3 | 147.3 | 460.6 | 453 | |
Depreciation and amortization | 56.2 | 53.8 | 168.4 | 157.8 | |
TOTAL COSTS OF REVENUES | 1,911 | 1,812.7 | 5,422.4 | 5,141.7 | |
Selling, general, and administrative expenses | 665 | 634.4 | 1,953.6 | 1,866.7 | |
Interest expense | 16.8 | 16.3 | 57.2 | 38.1 | |
TOTAL EXPENSES | 2,592.8 | 2,463.4 | 7,433.2 | 7,046.5 | |
Other income, net | (9.9) | (9.6) | (261) | (84.7) | |
EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 827.9 | 794.8 | 2,142.7 | 1,807.7 | |
Provision for income taxes | 240 | 262.3 | 675.1 | 596.3 | |
NET EARNINGS FROM CONTINUING OPERATIONS | 587.9 | 532.5 | 1,467.6 | 1,211.4 | |
LOSS FROM DISCONTINUED OPERATIONS BEFORE INCOME TAXES | 0 | 0 | 0 | (1.4) | |
Benefit for income taxes | 0 | 0 | 0 | (0.5) | |
NET LOSS FROM DISCONTINUED OPERATIONS | 0 | 0 | 0 | (0.9) | |
NET EARNINGS | $ 587.9 | $ 532.5 | $ 1,467.6 | $ 1,210.5 | |
Basic Earnings Per Share from Continuing Operations (in US$ per share) | $ 1.32 | $ 1.17 | $ 3.27 | $ 2.64 | |
Basic Loss Per Share from Discontinued Operations (in US$ per share) | 0 | 0 | 0 | 0 | |
BASIC EARNINGS PER SHARE (in US$ per share) | 1.32 | 1.17 | 3.27 | 2.64 | |
Diluted Earnings Per Share from Continuing Operations (in US$ per share) | 1.31 | 1.17 | 3.25 | 2.63 | |
Diluted Loss Per Share from Discontinued Operations (in US$ per share) | 0 | 0 | 0 | 0 | |
DILUTED EARNINGS PER SHARE (in US$ per share) | $ 1.31 | $ 1.17 | $ 3.25 | $ 2.63 | |
Basic weighted average shares outstanding (shares) | 446.5 | 454.4 | 448.9 | 458.2 | |
Diluted weighted average shares outstanding (shares) | 449.2 | 456.9 | 451.3 | 460.6 | |
Dividends declared per common share (in US$ per share) | $ 0.570 | $ 0.530 | $ 1.670 | $ 1.550 | |
[1] | Professional Employer Organization (“PEO”) revenues are net of direct pass-through costs, primarily consisting of payroll wages and payroll taxes of $9,207.2 million and $8,374.8 million for the three months ended March 31, 2017 and 2016, respectively, and $26,040.3 million and $23,613.0 million for the nine months ended March 31, 2017 and 2016, respectively. |
Statements of Consolidated Ear3
Statements of Consolidated Earnings (Unaudited) Parenthetical - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||||
Direct Pass Through Costs P E O Revenues | $ 9,207.2 | $ 8,374.8 | $ 26,040.3 | $ 23,613 |
Statements of Consolidated Comp
Statements of Consolidated Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Consolidated Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 587.9 | $ 532.5 | $ 1,467.6 | $ 1,210.5 |
Other comprehensive income/loss: | ||||
Currency translation adjustments | 20.3 | 41.2 | (23.9) | (5.2) |
Unrealized net gains/(losses) on available-for-sale securities | 46.3 | 271.8 | (438.3) | 150.8 |
Tax effect | (16.5) | (95.9) | 155.1 | (53.3) |
Reclassification of net losses/(gains) on available-for-sale securities to net earnings | 0.2 | 0.1 | (1.1) | 3.9 |
Tax effect | (0.1) | (0.1) | 0.3 | (1.3) |
Reclassification of pension liability adjustment to net earnings | 5.1 | 3 | 15.3 | 8.9 |
Tax effect | (1.8) | (1) | (5.5) | (3.2) |
Other comprehensive income/(loss), net of tax | 53.5 | 219.1 | (298.1) | 100.6 |
Comprehensive income | $ 641.4 | $ 751.6 | $ 1,169.5 | $ 1,311.1 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 2,995.5 | $ 3,191.1 |
Accounts receivable, net of allowance for doubtful accounts of $48.0 and $38.1, respectively | 1,811.5 | 1,742.8 |
Other current assets | 820.3 | 725.3 |
Total current assets before funds held for clients | 5,627.3 | 5,659.2 |
Funds held for clients | 33,887.1 | 33,841.2 |
Total current assets | 39,514.4 | 39,500.4 |
Long-term receivables, net of allowance for doubtful accounts of $0.8 and $0.5, respectively | 27 | 27.1 |
Property, plant and equipment, net | 750.6 | 685 |
Other assets | 1,242.4 | 1,241.3 |
Goodwill | 1,726.7 | 1,682 |
Intangible assets, net | 594.8 | 534.2 |
Total assets | 43,855.9 | 43,670 |
Current liabilities: | ||
Accounts payable | 126.5 | 152.3 |
Accrued expenses and other current liabilities | 1,336.2 | 1,246.8 |
Accrued payroll and payroll-related expenses | 527.1 | 616.7 |
Dividends payable | 251 | 238.4 |
Short-term deferred revenues | 227.2 | 233.2 |
Income taxes payable | 133.8 | 28.2 |
Total current liabilities before client funds obligations | 2,601.8 | 2,515.6 |
Client funds obligations | 33,816.7 | 33,331.8 |
Total current liabilities | 36,418.5 | 35,847.4 |
Long-term debt | 2,002.5 | 2,007.7 |
Other liabilities | 836.1 | 701.1 |
Deferred income taxes | 108.9 | 251.1 |
Long-term deferred revenues | 386.8 | 381.1 |
Total liabilities | 39,752.8 | 39,188.4 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity: | ||
Preferred stock, $1.00 par value: Authorized, 0.3 shares; issued, none | 0 | 0 |
Common stock, $0.10 par value: authorized, 1,000.0 shares; issued, 638.7 shares at March 31, 2017 and June 30, 2016; outstanding, 447.9 and 455.7 shares at March 31, 2017 and June 30, 2016, respectively | 63.9 | 63.9 |
Capital in excess of par value | 833.5 | 768.1 |
Retained earnings | 14,717.7 | 14,003.3 |
Treasury stock - at cost: 190.8 and 183.0 shares at March 31, 2017 and June 30, 2016, respectively | (10,998.8) | (10,138.6) |
Accumulated other comprehensive loss | (513.2) | (215.1) |
Total stockholders’ equity | 4,103.1 | 4,481.6 |
Total liabilities and stockholders’ equity | $ 43,855.9 | $ 43,670 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts - trade receivables - Current | $ 48 | $ 38.1 |
Allowance for doubtful accounts - trade receivables - Long-term | $ 0.8 | $ 0.5 |
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, shares authorized | 300,000 | 300,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (usd per share) | $ 0.1 | $ 0.10 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 638,700,000 | 638,700,000 |
Common stock, shares outstanding | 447,900,000 | 455,700,000 |
Treasury stock, shares | 190,800,000 | 183,000,000 |
Statements Of Consolidated Cash
Statements Of Consolidated Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash Flows from Operating Activities: | ||
NET EARNINGS | $ 1,467.6 | $ 1,210.5 |
Adjustments to reconcile net earnings to cash flows provided by operating activities: | ||
Depreciation and amortization | 233.6 | 214.7 |
Deferred income taxes | 22.2 | 22.4 |
Stock-based compensation expense | 101.2 | 102.4 |
Net pension expense | 18.1 | 13.2 |
Net amortization of premiums and accretion of discounts on available-for-sale securities | 66.1 | 71 |
Gain on sale of building | 0 | (13.9) |
Gain on sale of divested businesses, net of tax | (121.4) | (21.8) |
Other | 24.8 | 22.9 |
Changes in operating assets and liabilities, net of effects from acquisitions and divestitures of businesses: | ||
Increase in accounts receivable | (90.1) | (545.8) |
Increase in other assets | (152.9) | (206.7) |
(Decrease) / Increase in accounts payable | (29.5) | 2.3 |
Increase in accrued expenses and other liabilities | 129 | 363.2 |
Net cash flows provided by operating activities | 1,668.7 | 1,234.4 |
Cash Flows from Investing Activities: | ||
Purchases of corporate and client funds marketable securities | (3,470) | (4,240.9) |
Proceeds from the sales and maturities of corporate and client funds marketable securities | 2,704.6 | 4,061.2 |
Net decrease / (increase) in restricted cash and cash equivalents held to satisfy client funds obligations | 87.7 | (15,969.9) |
Capital expenditures | (174.5) | (127.6) |
Additions to intangibles | (162.1) | (160.1) |
Acquisitions of businesses, net of cash acquired | (86.7) | 0 |
Proceeds from the sale of property, plant, and equipment and other assets | 0 | 15.7 |
Proceeds from the sale of divested businesses | 234 | 162.2 |
Net cash flows used in investing activities | (867) | (16,259.4) |
Cash Flows from Financing Activities: | ||
Net increase in client funds obligations | 636.7 | 16,098.1 |
Net proceeds from debt issuance | 0 | 1,998.3 |
Payments of debt | (1.5) | (1) |
Repurchases of common stock | (956.8) | (1,091) |
Net proceeds from stock purchase plan and stock-based compensation plans | 74.5 | 52.7 |
Dividends paid | (739.4) | (701.2) |
Other | 0 | (23.3) |
Net cash flows (used in) / provided by financing activities | (986.5) | 16,332.6 |
Effect of exchange rate changes on cash and cash equivalents | (10.8) | (5.5) |
Net change in cash and cash equivalents | (195.6) | 1,302.1 |
Cash and cash equivalents, beginning of period | 3,191.1 | 1,639.3 |
Cash and cash equivalents, end of period | 2,995.5 | 2,941.4 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 69.8 | 34 |
Cash paid for income taxes, net of income tax refunds | $ 569.2 | $ 420.3 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying Consolidated Financial Statements and footnotes thereto of Automatic Data Processing, Inc. and its subsidiaries (“ADP” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Consolidated Financial Statements and footnotes thereto are unaudited. In the opinion of the Company’s management, the Consolidated Financial Statements reflect all adjustments, which are of a normal recurring nature, that are necessary for a fair presentation of the Company’s interim financial results. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the assets, liabilities, revenue, expenses, and accumulated other comprehensive income that are reported in the Consolidated Financial Statements and footnotes thereto. Actual results may differ from those estimates. The Consolidated Financial Statements and all relevant footnotes have been adjusted for all businesses that qualify as a discontinued operation. The Interim Financial Data by Segment has been adjusted to reflect a change in the Company's segment profitability measure for all periods presented. Refer to Note 16 for further information. Interim financial results are not necessarily indicative of financial results for a full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2016 (“fiscal 2016 ”). |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted Accounting Pronouncements In July 2016, the Company adopted Accounting Standards Update ("ASU") 2016-09, "Compensation - Stock Compensation - Improvements to Employee Share-Based Payment Accounting (Topic 718)." As a result of this standard, the Company prospectively recorded income tax benefits and deficiencies with respect to stock-based compensation as income tax expense or benefit in the income statement for periods beginning after July 1, 2016. This resulted in a $9.5 million and $29.9 million benefit in our income tax expense for the three and nine months ended March 31, 2017 , respectively. The Company retrospectively classified excess tax benefits as an operating activity on the Statements of Consolidated Cash Flows, which increased operating cash flows and decreased financing cash flows by $33.6 million for the nine months ended March 31, 2016 . Refer to Note 13 for the impact of the prospective adoption of the excess tax benefits in the income statement for the three and nine months ended March 31, 2017 . In July 2016, the Company prospectively adopted ASU 2015-05, "Customer's Accounting for Fees Paid in a Cloud Computing Arrangement." The update provides guidance on whether a cloud computing arrangement includes a software license. For new and materially modified cloud computing arrangements that include a software license entered into after July 1, 2016, the Company accounted for the software license element consistent with the acquisition of other software licenses. If the new or materially modified cloud computing arrangement did not include a software license, the Company accounted for the arrangement as a service contract. The adoption of ASU 2015-05 did not have a material impact on the Company's consolidated results of operations, financial condition, or cash flows. In July 2016, the Company prospectively adopted ASU 2015-04, "Compensation - Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employer's Defined Benefit Obligation and Plan Assets." The update allows an entity to remeasure their pension and other post-retirement benefit plan assets and liabilities at the month-end closest to a significant event such as a plan amendment, curtailment, or settlement. The adoption had no impact on the Company's consolidated results of operations, financial condition, or cash flows as presented, however the future impact of ASU 2015-04 will be dependent upon the nature of future significant events impacting the Company's pension plans, if any. Recently Issued Accounting Pronouncements In March 2017, the Financial Accounting Standards Board ("FASB") issued ASU 2017-08, "Receivables - Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities." ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium and requires the premium to be amortized to the earliest call date. ASU 2017-08 will be effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company has not yet determined the impact of ASU 2017-08 on its consolidated results of operations, financial condition, or cash flows. In March 2017, the FASB issued ASU 2017-07, "Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost." ASU 2017-07 requires reporting the service cost component in the same line item or items as other compensation costs arising during the period in the Statements of Consolidated Earnings. The other components of net periodic pension cost are required to be presented in the Statements of Consolidated Earnings separately from the service cost component. Such changes are to be applied retrospectively from the date of adoption. The ASU also allows only the service cost component to be eligible for capitalization, when applicable, prospectively from the date of adoption. ASU 2017-07 will be effective for fiscal years beginning after December 15, 2017. Early adoption is permitted. The Company has not yet determined the impact of ASU 2017-07 on its consolidated results of operations, financial condition, or cash flows. In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairments.” ASU 2017-04 establishes a one-step process for testing goodwill for a decrease in value, requiring a goodwill impairment loss to be measured as the excess of the reporting unit’s carrying amount over its fair value. The guidance eliminates the second step of the current two-step process that requires the impairment to be measured as the difference between the implied value of a reporting unit’s goodwill with the goodwill’s carrying amount. ASU 2017-04 will be effective for fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual impairment tests after January 1, 2017. ASU 2017-04 is not expected to have an impact on the Company’s consolidated results of operations, financial condition, or cash flows. In January 2017, the FASB issued ASU 2017-01, "Business Combinations (Topic 805) - Clarifying the Definition of a Business," to clarify the definition of a business in order to allow for the evaluation of whether transactions should be accounted for as acquisitions or disposals of assets or businesses. ASU 2017-01 will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. The future impact of ASU 2017-01 will be dependent upon the nature of future acquisitions or dispositions made by the Company, if any. In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash." ASU 2016-18 requires that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and restricted cash. Accordingly, restricted cash will be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statements of Consolidated Cash Flows. ASU 2016-18 will be effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The Company expects to retrospectively adopt the new standard in its fiscal year beginning on July 1, 2017. ASU 2016-18 will not have a material impact on the Company's consolidated results of operations or financial condition. In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." This update amends the existing accounting standards for lease accounting, and requires lessees to recognize most lease assets and lease liabilities on the balance sheet and to disclose key information about leasing arrangements. ASU 2016-02 requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application. ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company has not yet determined the impact of ASU 2016-02 on its consolidated results of operations, financial condition, or cash flows. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)," which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance, and has since issued additional amendments to ASU 2014-09. These new standards require an entity to recognize revenue depicting the transfer of 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 new standards will also result in enhanced revenue related disclosures. Entities have the option to apply the new guidance under a retrospective approach to each prior reporting period presented or a modified retrospective approach with the cumulative effect of initially applying the new guidance recognized at the date of initial application within the Statements of Consolidated Financial Position. The new standards are effective for fiscal years, and interim reporting periods within those years, beginning after December 15, 2017. Early adoption is permitted. The Company expects to adopt the new standard in its fiscal year beginning on July 1, 2018 and anticipates applying the guidance under the full retrospective approach. The Company has not fully determined the impact of these new revenue recognition standards on its consolidated results of operations, financial condition, or cash flows; however, the Company expects the provisions to primarily impact the manner in which it treats certain costs to fulfill contracts (i.e., implementation costs) and costs to acquire new contracts (i.e., selling costs). Generally, as it relates to these two items, the provisions of the new standard will result in the Company deferring additional costs on the Consolidated Balance Sheets and subsequently amortizing them to the Statements of Consolidated Earnings over the expected client life. |
Acquisitions
Acquisitions | 9 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisition | Acquisitions The Company acquired two businesses during the nine months ended March 31, 2017 for total cash consideration of approximately $90.0 million and contingent consideration of up to $35.0 million , which is payable over the next three years , subject to the achievement of specified financial metrics and/or other conditions. The Company determined the fair value of the contingent consideration on the acquisition date using various estimates that are not observable in the market and represent a Level 3 measurement within the fair value hierarchy. The acquisitions were not material to the Company's results of operations, financial position, or cash flows and, therefore, the pro forma impact of these acquisitions is not presented. The results of the acquisitions will be reported within the Company’s Employer Services segment. Assets acquired and liabilities assumed in the business combinations were recorded on the Company’s Consolidated Balance Sheets as of the acquisition dates based upon the estimated fair value at such dates. The results of operations of the businesses acquired by the Company have been included in the Statements of Consolidated Earnings since the date of acquisition. The excess of the purchase price over the estimated fair value of the underlying assets acquired and liabilities assumed was allocated to goodwill. The allocation of the excess purchase price was based upon preliminary estimates and assumptions and is subject to revision when the Company receives final information. Accordingly, the measurement period for such purchase price allocations will end when the information, or the facts and circumstances, becomes available, but will not exceed twelve months from the date of acquisition. |
Divestitures
Divestitures | 9 Months Ended |
Mar. 31, 2017 | |
Divestiture [Abstract] | |
Divestiture | Divestitures On November 28, 2016 , the Company completed the sale of its Consumer Health Spending Account ("CHSA") and Consolidated Omnibus Reconciliation Act ("COBRA") businesses for a pre-tax gain of $205.4 million , and recorded such gain within Other income, net on the Statements of Consolidated Earnings. The historical results of operations of these businesses are included in the Employer Services segment. On September 1, 2015 , the Company completed the sale of its AdvancedMD ("AMD") business for a pre-tax gain of $29.1 million , and recorded such gain within Other income, net on the Statements of Consolidated Earnings. The historical results of operations of this business are included in the Other segment. The Company determined that the CHSA, COBRA and AMD divestitures did not meet the criteria for reporting discontinued operations under ASU 2014-08 as the disposition of these businesses does not represent a strategic shift that has a major effect on the Company's operations or financial results. |
Service Alignment Initiative
Service Alignment Initiative | 9 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Service Alignment Initiative | Service Alignment Initiative On July 28, 2016, the Company announced a Service Alignment Initiative that is intended to simplify the Company's service organization by aligning the Company's service operations to its strategic platforms and locations. In fiscal 2016, the Company entered into leases in Norfolk, Virginia and Maitland, Florida, and in October 2016, the Company entered into a lease in Tempe, Arizona as part of this effort. The Company began incurring charges for this initiative during the first quarter of the fiscal year and expects to continue to incur charges throughout the year ended June 30, 2017 ("fiscal 2017 ") and the year ended June 30, 2018 ("fiscal 2018") as the initiative is executed. The charges primarily relate to employee separation benefits recognized under Accounting Standards Codification ("ASC") 712, and also include charges for the relocation of certain current Company employees, lease termination costs, and accelerated depreciation of fixed assets. The Company expects to recognize pre-tax restructuring charges in the range of $100 million to $125 million through fiscal 2018, consisting primarily of cash expenditures for employee separation benefits in the range of $75 million to $85 million , and other initiative costs in the range of $25 million to $40 million . The table below summarizes the composition of the Company's Service Alignment Initiative charges: Three Months Ended Nine Months Ended Cumulative amount from inception through March 31, March 31, March 31, 2017 2017 2017 Employee separation benefits (a) $ (0.1 ) $ 37.2 $ 37.2 Other initiative costs (b) 0.7 4.4 4.4 Total (c) $ 0.6 $ 41.6 $ 41.6 Activity for the Service Alignment Initiative liability for the nine months ended March 31, 2017 was as follows: Employee separation benefits Other initiative costs Total Balance at June 30, 2016 $ — $ — $ — Charged to expense 37.2 4.4 41.6 Cash payments (4.9 ) (2.4 ) (7.3 ) Non-cash utilization — (1.6 ) (1.6 ) Balance at March 31, 2017 $ 32.3 $ 0.4 $ 32.7 (a) - Charges are recorded in selling, general and administrative expenses on the Statements of Consolidated Earnings. (b) - Other initiative costs include costs to relocate certain current Company employees to new locations, lease termination charges (both included within selling, general and administrative expenses on the Statements of Consolidated Earnings), and accelerated depreciation on fixed assets (included within depreciation and amortization on the Statements of Consolidated Earnings). (c) - All charges are included within the Other segment. |
Earnings per Share (_EPS_)
Earnings per Share (“EPS”) | 9 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Share (“EPS”) | Earnings per Share (“EPS”) Basic Effect of Employee Stock Option Shares Effect of Employee Restricted Stock Shares Diluted Three Months Ended March 31, 2017 Net earnings from continuing operations $ 587.9 $ 587.9 Weighted average shares (in millions) 446.5 1.1 1.6 449.2 EPS from continuing operations $ 1.32 $ 1.31 Three Months Ended March 31, 2016 Net earnings from continuing operations $ 532.5 $ 532.5 Weighted average shares (in millions) 454.4 1.0 1.5 456.9 EPS from continuing operations $ 1.17 $ 1.17 Nine Months Ended March 31, 2017 Net earnings from continuing operations $ 1,467.6 $ 1,467.6 Weighted average shares (in millions) 448.9 0.9 1.5 451.3 EPS from continuing operations $ 3.27 $ 3.25 Nine Months Ended March 31, 2016 Net earnings from continuing operations $ 1,211.4 $ 1,211.4 Weighted average shares (in millions) 458.2 0.9 1.5 460.6 EPS from continuing operations $ 2.64 $ 2.63 Options to purchase 0.9 million shares of common stock for the three months ended March 31, 2016 , and 0.9 million and 1.7 million shares of common stock for the nine months ended March 31, 2017 and 2016 , respectively, were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive. |
Other Income, Net
Other Income, Net | 9 Months Ended |
Mar. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Other Income, net | Other Income, Net Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Interest income on corporate funds $ (10.1 ) $ (9.7 ) $ (54.5 ) $ (45.6 ) Realized gains on available-for-sale securities (0.6 ) (2.0 ) (3.1 ) (3.5 ) Realized losses on available-for-sale securities 0.8 2.1 2.0 7.4 Gain on sale of businesses (see Note 4) — — (205.4 ) (29.1 ) Gain on sale of building — — — (13.9 ) Other income, net $ (9.9 ) $ (9.6 ) $ (261.0 ) $ (84.7 ) During the nine months ended March 31, 2016 , the Company sold a building and, as a result, recorded a gain of $13.9 million in Other income, net, on the Statements of Consolidated Earnings. |
Corporate Investments and Funds
Corporate Investments and Funds Held For Clients | 9 Months Ended |
Mar. 31, 2017 | |
Corporate Investments And Funds Held For Clients [Abstract] | |
Corporate Investments And Funds Held For Clients | Corporate Investments and Funds Held for Clients Corporate investments and funds held for clients at March 31, 2017 and June 30, 2016 were as follows: March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value (A) Type of issue: Money market securities, cash and other cash equivalents $ 15,105.0 $ — $ — $ 15,105.0 Available-for-sale securities: Corporate bonds 9,380.8 86.4 (35.0 ) 9,432.2 U.S. government agency securities 3,731.6 22.4 (16.5 ) 3,737.5 Asset-backed securities 4,384.9 13.4 (13.3 ) 4,385.0 Canadian government obligations and 984.1 4.7 (4.3 ) 984.5 Canadian provincial bonds 741.3 16.3 (0.8 ) 756.8 U.S. Treasury securities 1,389.1 2.2 (18.0 ) 1,373.3 Municipal bonds 615.7 10.2 (2.9 ) 623.0 Other securities 490.2 7.5 (1.6 ) 496.1 Total available-for-sale securities 21,717.7 163.1 (92.4 ) 21,788.4 Total corporate investments and funds held for clients $ 36,822.7 $ 163.1 $ (92.4 ) $ 36,893.4 (A) Included within available-for-sale securities are corporate investments with fair values of $10.8 million and funds held for clients with fair values of $21,777.6 million . All available-for-sale securities were included in Level 2 of the fair value hierarchy. June 30, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value (B) Type of issue: Money market securities, cash and other cash equivalents $ 15,458.6 $ — $ — $ 15,458.6 Available-for-sale securities: Corporate bonds 9,429.2 261.8 (0.6 ) 9,690.4 U.S. government agency securities 4,298.8 91.3 — 4,390.1 Asset-backed securities 3,761.9 59.0 (0.3 ) 3,820.6 Canadian government obligations and 995.1 12.8 — 1,007.9 Canadian provincial bonds 735.4 30.8 (0.1 ) 766.1 U.S. Treasury securities 746.9 16.3 — 763.2 Municipal bonds 594.2 23.9 (0.3 ) 617.8 Other securities 533.3 15.8 (0.2 ) 548.9 Total available-for-sale securities 21,094.8 511.7 (1.5 ) 21,605.0 Total corporate investments and funds held for clients $ 36,553.4 $ 511.7 $ (1.5 ) $ 37,063.6 (B) Included within available-for-sale securities are corporate investments with fair values of $31.3 million and funds held for clients with fair values of $21,573.7 million . All available-for-sale securities were included in Level 2 of the fair value hierarchy. For a description of the fair value hierarchy and the Company's fair value methodologies, including the use of an independent third-party pricing service, see Note 1 "Summary of Significant Accounting Policies" in the Company's Annual Report on Form 10-K for fiscal 2016 . The Company did not transfer any assets between Levels during the nine months ended March 31, 2017 or fiscal 2016 . In addition, the Company concurred with and did not adjust the prices obtained from the independent pricing service. The Company has no available-for-sale securities included in Level 1 or Level 3 at March 31, 2017 . The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of March 31, 2017 , are as follows: March 31, 2017 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Value Gross Fair Market Value Gross Unrealized Losses Fair Market Value Corporate bonds $ (35.0 ) $ 2,986.3 $ — $ 7.4 $ (35.0 ) $ 2,993.7 U.S. government agency securities (16.5 ) 2,093.3 — — (16.5 ) 2,093.3 Asset-backed securities (13.3 ) 2,261.3 — 12.4 (13.3 ) 2,273.7 Canadian government obligations and (4.3 ) 468.3 — — (4.3 ) 468.3 Canadian provincial bonds (0.8 ) 121.7 — — (0.8 ) 121.7 U.S. Treasury securities (18.0 ) 1,167.2 — — (18.0 ) 1,167.2 Municipal bonds (2.8 ) 143.1 (0.1 ) 4.3 (2.9 ) 147.4 Other securities (1.4 ) 117.2 (0.2 ) 8.9 (1.6 ) 126.1 $ (92.1 ) $ 9,358.4 $ (0.3 ) $ 33.0 $ (92.4 ) $ 9,391.4 The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of June 30, 2016 , are as follows: June 30, 2016 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Value Gross Fair Market Value Gross Unrealized Losses Fair Market Value Corporate bonds $ (0.5 ) $ 138.0 $ (0.1 ) $ 35.1 $ (0.6 ) $ 173.1 U.S. government agency securities — — — — — — Asset-backed securities (0.1 ) 58.8 (0.2 ) 154.8 (0.3 ) 213.6 Canadian government obligations and — 53.2 — — — 53.2 Canadian provincial bonds (0.1 ) 19.1 — 7.8 (0.1 ) 26.9 U.S. Treasury securities — 3.4 — 1.6 — 5.0 Municipal bonds — 12.9 (0.3 ) 10.6 (0.3 ) 23.5 Other securities (0.1 ) 10.5 (0.1 ) 8.0 (0.2 ) 18.5 $ (0.8 ) $ 295.9 $ (0.7 ) $ 217.9 $ (1.5 ) $ 513.8 At March 31, 2017 , corporate bonds include investment-grade debt securities, which include a wide variety of issuers, industries, and sectors, primarily carry credit ratings of A and above, and have maturities ranging from April 2017 through March 2025 . At March 31, 2017 , U.S. government agency securities primarily include debt directly issued by Federal Home Loan Banks and Federal Farm Credit Banks with fair values of $2,727.1 million and $801.8 million , respectively. U.S. government agency securities represent senior, unsecured, non-callable debt that primarily carry ratings of Aaa by Moody's and AA+ by Standard & Poor's with maturities ranging from June 2017 through February 2025 . At March 31, 2017 , asset-backed securities include AAA rated senior tranches of securities with predominantly prime collateral of fixed-rate credit card, auto loan, equipment lease, and rate reduction receivables with fair values of $2,324.1 million , $1,402.5 million , $418.4 million , and $239.9 million , respectively. These securities are collateralized by the cash flows of the underlying pools of receivables. The primary risk associated with these securities is the collection risk of the underlying receivables. All collateral on such asset-backed securities has performed as expected through March 31, 2017 . At March 31, 2017 , other securities and their fair value primarily represent: AAA and AA rated sovereign bonds of $168.5 million , AAA and AA rated supranational bonds of $138.3 million , and AA rated mortgage-backed securities of $95.6 million that are guaranteed primarily by Federal National Mortgage Association ("Fannie Mae"). The Company's mortgage-backed securities represent an undivided beneficial ownership interest in a group or pool of one or more residential mortgages. These securities are collateralized by the cash flows of 15 -year and 30 -year residential mortgages and are guaranteed by Fannie Mae as to the timely payment of principal and interest. Classification of corporate investments on the Consolidated Balance Sheets is as follows: March 31, June 30, 2017 2016 Corporate investments: Cash and cash equivalents $ 2,995.5 $ 3,191.1 Short-term marketable securities (a) 3.2 23.5 Long-term marketable securities (b) 7.6 7.8 Total corporate investments $ 3,006.3 $ 3,222.4 (a) - Short-term marketable securities are included within Other current assets on the Consolidated Balance Sheets. (b) - Long-term marketable securities are included within Other assets on the Consolidated Balance Sheets. Funds held for clients represent assets that, based upon the Company's intent, are restricted for use solely for the purposes of satisfying the obligations to remit funds relating to the Company’s payroll and payroll tax filing services, which are classified as client funds obligations on our Consolidated Balance Sheets. Funds held for clients have been invested in the following categories: March 31, June 30, 2017 2016 Funds held for clients: Restricted cash and cash equivalents held to satisfy client funds obligations $ 12,109.5 $ 12,267.5 Restricted short-term marketable securities held to satisfy client funds obligations 3,003.3 3,032.1 Restricted long-term marketable securities held to satisfy client funds obligations 18,774.3 18,541.6 Total funds held for clients $ 33,887.1 $ 33,841.2 Client funds obligations represent the Company's contractual obligations to remit funds to satisfy clients' payroll and tax payment obligations and are recorded on the Consolidated Balance Sheets at the time that the Company impounds funds from clients. The client funds obligations represent liabilities that will be repaid within one year of the balance sheet date. The Company has reported client funds obligations as a current liability on the Consolidated Balance Sheets totaling $33,816.7 million and $33,331.8 million at March 31, 2017 and June 30, 2016 , respectively. The Company has classified funds held for clients as a current asset since these funds are held solely for the purposes of satisfying the client funds obligations. The Company has reported the cash flows related to the purchases of corporate and client funds marketable securities and related to the proceeds from the sales and maturities of corporate and client funds marketable securities on a gross basis in the investing section of the Statements of Consolidated Cash Flows. The Company has reported the cash inflows and outflows related to client funds investments with original maturities of ninety days or less on a net basis within net increase in restricted cash and cash equivalents and other restricted assets held to satisfy client funds obligations in the investing section of the Statements of Consolidated Cash Flows. The Company has reported the cash flows related to the cash received from and paid on behalf of clients on a net basis within net increase in client funds obligations in the financing activities section of the Statements of Consolidated Cash Flows. Approximately 81% of the available-for-sale securities held a AAA or AA rating at March 31, 2017 , as rated by Moody's, Standard & Poor's and, for Canadian securities, DBRS. All available-for-sale securities were rated as investment grade at March 31, 2017 . Expected maturities of available-for-sale securities at March 31, 2017 are as follows: One year or less $ 3,006.6 One year to two years 2,562.6 Two years to three years 4,923.3 Three years to four years 5,231.7 After four years 6,064.2 Total available-for-sale securities $ 21,788.4 |
Goodwill and Intangibles Assets
Goodwill and Intangibles Assets, net | 9 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles Assets, net | Goodwill and Intangibles Assets, net Changes in goodwill for the nine months ended March 31, 2017 are as follows: Employer Services PEO Services Total Balance at June 30, 2016 $ 1,677.2 $ 4.8 $ 1,682.0 Additions and other adjustments, net 79.5 — 79.5 Currency translation adjustments (13.4 ) — (13.4 ) Disposition of CHSA and COBRA businesses (21.4 ) — (21.4 ) Balance at March 31, 2017 $ 1,721.9 $ 4.8 $ 1,726.7 Components of intangible assets, net, are as follows: March 31, June 30, 2017 2016 Intangible assets: Software and software licenses $ 1,912.2 $ 1,811.6 Customer contracts and lists 607.4 603.7 Other intangibles 230.1 207.8 2,749.7 2,623.1 Less accumulated amortization: Software and software licenses (1,453.1 ) (1,403.8 ) Customer contracts and lists (496.3 ) (486.4 ) Other intangibles (205.5 ) (198.7 ) (2,154.9 ) (2,088.9 ) Intangible assets, net $ 594.8 $ 534.2 Other intangibles consist primarily of purchased rights, purchased content, trademarks and trade names (acquired directly or through acquisitions). All intangible assets have finite lives and, as such, are subject to amortization. The weighted average remaining useful life of the intangible assets is 5 years ( 4 years for software and software licenses, 8 years for customer contracts and lists, and 4 years for other intangibles). Amortization of intangible assets was $40.4 million and $39.6 million for the three months ended March 31, 2017 and 2016 , respectively, and $125.8 million and $113.3 million for the nine months ended March 31, 2017 and 2016 , respectively. Estimated future amortization expenses of the Company's existing intangible assets are as follows: Amount Three months ending June 30, 2017 $ 44.8 Twelve months ending June 30, 2018 $ 162.7 Twelve months ending June 30, 2019 $ 127.0 Twelve months ending June 30, 2020 $ 95.7 Twelve months ending June 30, 2021 $ 74.3 Twelve months ending June 30, 2022 $ 57.0 |
Short-term Financing
Short-term Financing | 9 Months Ended |
Mar. 31, 2017 | |
Short-Term Financing [Abstract] | |
Short-Term Financing | Short-term Financing The Company has a $3.25 billion , 364 -day credit agreement that matures in June 2017 with a one year term-out option. The Company also has a $2.25 billion five -year credit facility that matures in June 2020 that also contains an accordion feature under which the aggregate commitment can be increased by $500 million , subject to the availability of additional commitments. In addition, the Company has a five -year $3.75 billion credit facility maturing in June 2021 that contains an accordion feature under which the aggregate commitment can be increased by $500 million , subject to the availability of additional commitments. The interest rate applicable to committed borrowings is tied to LIBOR, the effective federal funds rate, or the prime rate, depending on the notification provided by the Company to the syndicated financial institutions prior to borrowing. The Company is also required to pay facility fees on the credit agreements. The primary uses of the credit facilities are to provide liquidity to the commercial paper program and funding for general corporate purposes, if necessary. The Company had no borrowings through March 31, 2017 under the credit agreements. The Company's U.S. short-term funding requirements related to client funds are sometimes obtained on an unsecured basis through the issuance of commercial paper, rather than liquidating previously-collected client funds that have already been invested in available-for-sale securities. This commercial paper program provides for the issuance of up to $9.25 billion in aggregate maturity value. The Company’s commercial paper program is rated A-1+ by Standard & Poor’s and Prime-1 by Moody’s. These ratings denote the highest quality commercial paper securities. Maturities of commercial paper can range from overnight to up to 364 days . At March 31, 2017 and June 30, 2016 , the Company had no commercial paper outstanding. For the three months ended March 31, 2017 and 2016 , the Company had average daily borrowings of $1.1 billion and $1.3 billion , respectively, at weighted average interest rates of 0.7% and 0.4% , respectively. For the nine months ended March 31, 2017 and 2016 , the Company had average daily borrowings of $3.2 billion and $2.7 billion , respectively, at weighted average interest rates of 0.5% and 0.2% , respectively. The weighted average maturity of the Company’s commercial paper during the three and nine months ended March 31, 2017 was approximately one day and two days , respectively. The Company’s U.S. and Canadian short-term funding requirements related to client funds obligations are sometimes obtained on a secured basis through the use of reverse repurchase agreements, which are collateralized principally by government and government agency securities, rather than liquidating previously-collected client funds that have already been invested in available-for-sale securities. These agreements generally have terms ranging from overnight to up to five business days . At March 31, 2017 and June 30, 2016 , there were no outstanding obligations related to the reverse repurchase agreements. For the three months ended March 31, 2017 and 2016 , the Company had average outstanding balances under reverse repurchase agreements of $145.0 million and $128.0 million , respectively, at weighted average interest rates of 0.5% . For the nine months ended March 31, 2017 and 2016 , the Company had average outstanding balances under reverse repurchase agreements of $258.1 million and $316.9 million , respectively, at weighted average interest rates of 0.5% and 0.4% , respectively. |
Long-term Debt
Long-term Debt | 9 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term Debt The Company has fixed-rate notes with 5 -year and 10 -year maturities for an aggregate principal amount of $2.0 billion (collectively the “Notes”). The Notes are senior unsecured obligations, and interest is payable in arrears, semi-annually. The principal amounts and associated effective interest rates of the Notes and other debt as of March 31, 2017 and June 30, 2016 , are as follows: Debt instrument Effective Interest Rate March 31, 2017 June 30, 2016 Fixed-rate 2.250% notes due September 15, 2020 2.37% $ 1,000.0 $ 1,000.0 Fixed-rate 3.375% notes due September 15, 2025 3.47% 1,000.0 1,000.0 Other 20.9 22.3 2,020.9 2,022.3 Less: current portion (7.8 ) (2.5 ) Less: unamortized discount and debt issuance costs (10.6 ) (12.1 ) Total long-term debt $ 2,002.5 $ 2,007.7 The effective interest rates for the Notes include the interest on the Notes and amortization of the discount and debt issuance costs. As of March 31, 2017 , the fair value of the Notes, based on Level 2 inputs, was $2,043.4 million . For a description of the fair value hierarchy and the Company's fair value methodologies, including the use of an independent third-party service, see Note 1 "Summary of Significant Accounting Policies" in the Company's Annual Report on Form 10-K for fiscal 2016 . |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Compensation and Employee Benefit Plans | Stock-based Compensation Plans The Company's share-based compensation consists of stock options, time-based restricted stock, time-based restricted stock units, performance-based restricted stock, and performance-based restricted stock units. The Company also offers an employee stock purchase plan for eligible employees. See the Company's Annual Report on Form 10-K for fiscal 2016 for a detailed description of the Company's stock-based compensation awards and employee stock purchase plan, including information related to vesting terms, service and performance conditions, and payout percentages. Also, see the Company's Annual Report on Form 10-K for fiscal 2016 for a discussion of the Company's process for estimating the fair value of stock options granted. The Company currently utilizes treasury stock to satisfy stock option exercises, issuances under the Company's employee stock purchase plan, and restricted stock awards. From time to time, the Company may repurchase shares of its common stock under its authorized share repurchase programs. The Company repurchased 1.9 million and 3.8 million shares in the three months ended March 31, 2017 and 2016 , respectively and repurchased 10.4 million and 13.2 million shares in the nine months ended March 31, 2017 and 2016 , respectively. The Company considers several factors in determining when to execute share repurchases, including, among other things, actual and potential acquisition activity, cash balances and cash flows, issuances due to employee benefit plan activity, and market conditions. The following table represents stock-based compensation expense and related income tax benefits for the three months ended March 31, 2017 and 2016 , respectively: Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Operating expenses $ 4.6 $ 5.3 $ 16.4 $ 17.0 Selling, general and administrative expenses 25.1 22.6 71.0 72.7 System development and programming costs 4.6 3.8 13.8 12.7 Total pre-tax stock-based compensation expense $ 34.3 $ 31.7 $ 101.2 $ 102.4 Income tax benefit $ 12.5 $ 11.2 $ 36.3 $ 37.0 As of March 31, 2017 , the total remaining unrecognized compensation cost related to unvested stock options, restricted stock units, and restricted stock awards amounted to $16.3 million , $32.5 million , and $80.9 million , respectively, which will be amortized over the weighted-average remaining requisite service periods of 2.5 years , 1.4 years , and 1.3 years , respectively. During the nine months ended March 31, 2017 , the following activity occurred under the Company’s existing plans: Stock Options: Number of Options (in thousands) Weighted Average Price (in dollars) Options outstanding at July 1, 2016 4,869 $ 65 Options granted 1,234 $ 91 Options exercised (1,529 ) $ 56 Options canceled/forfeited (202 ) $ 79 Options outstanding at March 31, 2017 4,372 $ 75 Time-Based Restricted Stock and Time-Based Restricted Stock Units: Number of Shares (in thousands) Number of Units (in thousands) Restricted shares/units outstanding at July 1, 2016 1,889 434 Restricted shares/units granted 884 202 Restricted shares/units vested (855 ) (202 ) Restricted shares/units forfeited (127 ) (36 ) Restricted shares/units outstanding at March 31, 2017 1,791 398 Performance-Based Restricted Stock and Performance-Based Restricted Stock Units: Number of Shares (in thousands) Number of Units (in thousands) Restricted shares/units outstanding at July 1, 2016 574 811 Restricted shares/units granted 172 313 Restricted shares/units vested (311 ) (272 ) Restricted shares/units forfeited (24 ) (77 ) Restricted shares/units outstanding at March 31, 2017 411 775 The fair value for stock options granted was estimated at the date of grant using the following assumptions: Nine Months Ended March 31, 2017 2016 Risk-free interest rate 1.2 % 1.6 % Dividend yield 2.3 % 2.6 % Weighted average volatility factor 23.2 % 25.6 % Weighted average expected life (in years) 5.4 5.4 Weighted average fair value (in dollars) $ 14.36 $ 13.16 |
Employee Benefit Plans | Pension Plans The components of net pension expense were as follows: Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Service cost – benefits earned during the period $ 20.2 $ 17.6 $ 60.6 $ 52.8 Interest cost on projected benefits 14.9 16.8 45.0 50.6 Expected return on plan assets (33.9 ) (32.8 ) (101.9 ) (98.5 ) Net amortization and deferral 4.8 2.8 14.4 8.3 Net pension expense $ 6.0 $ 4.4 $ 18.1 $ 13.2 |
Income Taxes
Income Taxes | 9 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective tax rate for the three months ended March 31, 2017 and 2016 was 29.0% and 33.0% , respectively. The decrease in the effective tax rate is due to tax incentives associated with the domestic production activity deduction and research tax credit for prior tax years which decreased the Company's effective tax rate by 630 basis points and the adoption of ASU 2016-09 related to the new accounting guidance for excess tax benefits on stock-based compensation (as further explained in Note 2 ), which decreased the Company's effective tax rate by 120 basis points. These decrease s were partially offset by tax reserves recorded for uncertain tax positions, a lower benefit from adjustments to the tax liability in the three months ended March 31, 2017 and the usage of foreign tax credits during the three months ended March 31, 2016 . The effective tax rate for the nine months ended March 31, 2017 and 2016 was 31.5% and 33.0% , respectively. The decrease in the effective tax rate is due to tax incentives associated with the domestic production activity deduction and research tax credit for prior tax years which decreased the Company's effective tax rate by 240 basis points and the adoption of ASU 2016-09 related to the new accounting guidance for excess tax benefits on stock-based compensation (as further explained in Note 2 ), which decreased the Company's effective tax rate by 140 basis points in the nine months ended March 31, 2017 . These decrease s were partially offset by the impact of the sale of the CHSA and COBRA businesses, a lower benefit related to the usage of foreign tax credits and a lower benefit from adjustments to the tax liability in the nine months ended March 31, 2017 , and the reversal of a valuation allowance during the nine months ended March 31, 2016 . |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In July 2016, Uniloc USA, Inc. and Uniloc Luxembourg, S.A. (“Uniloc”) filed a lawsuit against the Company in the United States District Court for the Eastern District of Texas alleging that Company products and services infringe four patents. Uniloc alleges infringement of its patents concerning centralized management of application programs on a network, distribution of application programs to a target station on a network, management of configurable application programs on a network, and license use management on a network. The complaint seeks unspecified monetary damages, costs, and injunctive relief. This litigation is still in its early stages and the Company is unable to estimate any reasonably possible loss, or range of loss, with respect to this matter. The Company intends to vigorously defend against this lawsuit. The Company is subject to various claims, litigation and regulatory compliance matters in the normal course of business. When a loss is considered probable and reasonably estimable, the Company records a liability in the amount of its best estimate for the ultimate loss. Management currently believes that the resolution of these claims, litigation and regulatory compliance matters against us, individually or in the aggregate, will not have a material adverse impact on our consolidated results of operations, financial condition or cash flows. These matters are subject to inherent uncertainties and management's view of these matters may change in the future. It is not the Company’s business practice to enter into off-balance sheet arrangements. In the normal course of business, the Company may enter into contracts in which it makes representations and warranties that relate to the performance of the Company’s services and products. The Company does not expect any material losses related to such representations and warranties. In October 2016, the Company entered into a lease agreement in Tempe, Arizona in support of the Service Alignment Initiative (see Note 5), resulting in incremental obligations as follows: Years ending June 30, 2018 $ 1.4 2019 5.4 2020 5.5 2021 5.7 Thereafter 41.9 $ 59.9 |
Reclassifications out of Accumu
Reclassifications out of Accumulated Other Comprehensive Income ("AOCI") | 9 Months Ended |
Mar. 31, 2017 | |
Reclassification out of Accumulated Other Comprehensive Income [Abstract] | |
Reclassifications out of Accumulated Other Comprehensive Income (AOCI) | Reclassifications out of Accumulated Other Comprehensive Income ("AOCI") Changes in AOCI by component are as follows: Three Months Ended March 31, 2017 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at December 31, 2016 $ (298.0 ) $ 19.9 $ (288.6 ) $ (566.7 ) Other comprehensive income before reclassification adjustments 20.3 46.3 — 66.6 Tax effect — (16.5 ) — (16.5 ) Reclassification adjustments to — 0.2 (A) 5.1 (B) 5.3 Tax effect — (0.1 ) (1.8 ) (1.9 ) Balance at March 31, 2017 $ (277.7 ) $ 49.8 $ (285.3 ) $ (513.2 ) Three Months Ended March 31, 2016 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at December 31, 2015 $ (274.7 ) $ 68.1 $ (172.5 ) $ (379.1 ) Other comprehensive income before reclassification adjustments 41.2 271.8 — 313.0 Tax effect — (95.9 ) — (95.9 ) Reclassification adjustments to net earnings — 0.1 (A) 3.0 (B) 3.1 Tax effect — (0.1 ) (1.0 ) (1.1 ) Balance at March 31, 2016 $ (233.5 ) $ 244.0 $ (170.5 ) $ (160.0 ) Nine Months Ended March 31, 2017 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at June 30, 2016 $ (253.8 ) $ 333.8 $ (295.1 ) $ (215.1 ) Other comprehensive loss (23.9 ) (438.3 ) — (462.2 ) Tax effect — 155.1 — 155.1 Reclassification adjustments to — (1.1 ) (A) 15.3 (B) 14.2 Tax effect — 0.3 (5.5 ) (5.2 ) Balance at March 31, 2017 $ (277.7 ) $ 49.8 $ (285.3 ) $ (513.2 ) Nine Months Ended March 31, 2016 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at June 30, 2015 $ (228.3 ) $ 143.9 $ (176.2 ) $ (260.6 ) Other comprehensive (loss)/income (5.2 ) 150.8 — 145.6 Tax effect — (53.3 ) — (53.3 ) Reclassification adjustments to — 3.9 (A) 8.9 (B) 12.8 Tax effect — (1.3 ) (3.2 ) (4.5 ) Balance at March 31, 2016 $ (233.5 ) $ 244.0 $ (170.5 ) $ (160.0 ) (A) Reclassification adjustments out of AOCI are included within Other income, net, on the Statements of Consolidated Earnings. (B) Reclassification adjustments out of AOCI are included in net pension expense (see Note 12 ). |
Interim Financial Data by Segme
Interim Financial Data by Segment | 9 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Interim Financial Data by Segment | Interim Financial Data by Segment Based upon similar economic and operational characteristics, the Company’s strategic business units have been aggregated into the following two reportable segments: Employer Services and PEO Services. The primary components of the “Other” segment are non-recurring gains and losses, miscellaneous processing services, the elimination of intercompany transactions, interest expense, the results of operations of ADP Indemnity (a wholly-owned captive insurance company that provides workers’ compensation and employee’s liability deductible reimbursement insurance protection for PEO Services’ worksite employees), certain charges and expenses that have not been allocated to the reportable segments, and the historical results of the AMD business. Beginning in the first quarter of fiscal 2017, the Company's chief operating decision maker began reviewing the Company's results with stock-based compensation included in the Company's operating segments. This change, as well as changes to the allocation methodology for certain allocations, has been adjusted in both the current period and the prior period in the table below, and did not materially affect reportable segment results. Certain revenues and expenses are charged to the reportable segments at a standard rate for management reasons. Other costs are recorded based on management responsibility. There is a reconciling item for the difference between actual interest income earned on invested funds held for clients and interest credited to Employer Services and PEO Services at a standard rate of 4.5% . This allocation is made for management reasons so that the reportable segments' results are presented on a consistent basis without the impact of fluctuations in interest rates. This reconciling adjustment to the reportable segments' revenues and earnings from continuing operations before income taxes is eliminated in consolidation. Segment Results: Revenues from Continuing Operations Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Employer Services $ 2,627.2 $ 2,576.7 $ 7,197.8 $ 6,920.1 PEO Services 974.4 866.3 2,592.0 2,305.2 Other (2.1 ) (2.8 ) (8.2 ) 5.0 Reconciling item: Client fund interest (188.7 ) (191.6 ) (466.7 ) (460.8 ) $ 3,410.8 $ 3,248.6 $ 9,314.9 $ 8,769.5 Earnings from Continuing Operations before Income Taxes Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Employer Services $ 963.7 $ 956.2 $ 2,302.1 $ 2,146.2 PEO Services 120.0 97.9 341.5 279.9 Other (67.1 ) (67.7 ) (34.2 ) (157.6 ) Reconciling item: Client fund interest (188.7 ) (191.6 ) (466.7 ) (460.8 ) $ 827.9 $ 794.8 $ 2,142.7 $ 1,807.7 |
Service Alignment Initiative (T
Service Alignment Initiative (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The table below summarizes the composition of the Company's Service Alignment Initiative charges: Three Months Ended Nine Months Ended Cumulative amount from inception through March 31, March 31, March 31, 2017 2017 2017 Employee separation benefits (a) $ (0.1 ) $ 37.2 $ 37.2 Other initiative costs (b) 0.7 4.4 4.4 Total (c) $ 0.6 $ 41.6 $ 41.6 Activity for the Service Alignment Initiative liability for the nine months ended March 31, 2017 was as follows: Employee separation benefits Other initiative costs Total Balance at June 30, 2016 $ — $ — $ — Charged to expense 37.2 4.4 41.6 Cash payments (4.9 ) (2.4 ) (7.3 ) Non-cash utilization — (1.6 ) (1.6 ) Balance at March 31, 2017 $ 32.3 $ 0.4 $ 32.7 (a) - Charges are recorded in selling, general and administrative expenses on the Statements of Consolidated Earnings. (b) - Other initiative costs include costs to relocate certain current Company employees to new locations, lease termination charges (both included within selling, general and administrative expenses on the Statements of Consolidated Earnings), and accelerated depreciation on fixed assets (included within depreciation and amortization on the Statements of Consolidated Earnings). (c) - All charges are included within the Other segment. |
Earnings per Share (_EPS_) (Tab
Earnings per Share (“EPS”) (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Basic Effect of Employee Stock Option Shares Effect of Employee Restricted Stock Shares Diluted Three Months Ended March 31, 2017 Net earnings from continuing operations $ 587.9 $ 587.9 Weighted average shares (in millions) 446.5 1.1 1.6 449.2 EPS from continuing operations $ 1.32 $ 1.31 Three Months Ended March 31, 2016 Net earnings from continuing operations $ 532.5 $ 532.5 Weighted average shares (in millions) 454.4 1.0 1.5 456.9 EPS from continuing operations $ 1.17 $ 1.17 Nine Months Ended March 31, 2017 Net earnings from continuing operations $ 1,467.6 $ 1,467.6 Weighted average shares (in millions) 448.9 0.9 1.5 451.3 EPS from continuing operations $ 3.27 $ 3.25 Nine Months Ended March 31, 2016 Net earnings from continuing operations $ 1,211.4 $ 1,211.4 Weighted average shares (in millions) 458.2 0.9 1.5 460.6 EPS from continuing operations $ 2.64 $ 2.63 |
Other Income, Net (Tables)
Other Income, Net (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Other Income, net | Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Interest income on corporate funds $ (10.1 ) $ (9.7 ) $ (54.5 ) $ (45.6 ) Realized gains on available-for-sale securities (0.6 ) (2.0 ) (3.1 ) (3.5 ) Realized losses on available-for-sale securities 0.8 2.1 2.0 7.4 Gain on sale of businesses (see Note 4) — — (205.4 ) (29.1 ) Gain on sale of building — — — (13.9 ) Other income, net $ (9.9 ) $ (9.6 ) $ (261.0 ) $ (84.7 ) |
Corporate Investments and Fun27
Corporate Investments and Funds Held For Clients (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Corporate Investments And Funds Held For Clients [Abstract] | |
Available-for-sale Securities | Corporate investments and funds held for clients at March 31, 2017 and June 30, 2016 were as follows: March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value (A) Type of issue: Money market securities, cash and other cash equivalents $ 15,105.0 $ — $ — $ 15,105.0 Available-for-sale securities: Corporate bonds 9,380.8 86.4 (35.0 ) 9,432.2 U.S. government agency securities 3,731.6 22.4 (16.5 ) 3,737.5 Asset-backed securities 4,384.9 13.4 (13.3 ) 4,385.0 Canadian government obligations and 984.1 4.7 (4.3 ) 984.5 Canadian provincial bonds 741.3 16.3 (0.8 ) 756.8 U.S. Treasury securities 1,389.1 2.2 (18.0 ) 1,373.3 Municipal bonds 615.7 10.2 (2.9 ) 623.0 Other securities 490.2 7.5 (1.6 ) 496.1 Total available-for-sale securities 21,717.7 163.1 (92.4 ) 21,788.4 Total corporate investments and funds held for clients $ 36,822.7 $ 163.1 $ (92.4 ) $ 36,893.4 (A) Included within available-for-sale securities are corporate investments with fair values of $10.8 million and funds held for clients with fair values of $21,777.6 million . All available-for-sale securities were included in Level 2 of the fair value hierarchy. June 30, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Market Value (B) Type of issue: Money market securities, cash and other cash equivalents $ 15,458.6 $ — $ — $ 15,458.6 Available-for-sale securities: Corporate bonds 9,429.2 261.8 (0.6 ) 9,690.4 U.S. government agency securities 4,298.8 91.3 — 4,390.1 Asset-backed securities 3,761.9 59.0 (0.3 ) 3,820.6 Canadian government obligations and 995.1 12.8 — 1,007.9 Canadian provincial bonds 735.4 30.8 (0.1 ) 766.1 U.S. Treasury securities 746.9 16.3 — 763.2 Municipal bonds 594.2 23.9 (0.3 ) 617.8 Other securities 533.3 15.8 (0.2 ) 548.9 Total available-for-sale securities 21,094.8 511.7 (1.5 ) 21,605.0 Total corporate investments and funds held for clients $ 36,553.4 $ 511.7 $ (1.5 ) $ 37,063.6 (B) Included within available-for-sale securities are corporate investments with fair values of $31.3 million and funds held for clients with fair values of $21,573.7 million . All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of March 31, 2017 , are as follows: March 31, 2017 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Value Gross Fair Market Value Gross Unrealized Losses Fair Market Value Corporate bonds $ (35.0 ) $ 2,986.3 $ — $ 7.4 $ (35.0 ) $ 2,993.7 U.S. government agency securities (16.5 ) 2,093.3 — — (16.5 ) 2,093.3 Asset-backed securities (13.3 ) 2,261.3 — 12.4 (13.3 ) 2,273.7 Canadian government obligations and (4.3 ) 468.3 — — (4.3 ) 468.3 Canadian provincial bonds (0.8 ) 121.7 — — (0.8 ) 121.7 U.S. Treasury securities (18.0 ) 1,167.2 — — (18.0 ) 1,167.2 Municipal bonds (2.8 ) 143.1 (0.1 ) 4.3 (2.9 ) 147.4 Other securities (1.4 ) 117.2 (0.2 ) 8.9 (1.6 ) 126.1 $ (92.1 ) $ 9,358.4 $ (0.3 ) $ 33.0 $ (92.4 ) $ 9,391.4 The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of June 30, 2016 , are as follows: June 30, 2016 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Value Gross Fair Market Value Gross Unrealized Losses Fair Market Value Corporate bonds $ (0.5 ) $ 138.0 $ (0.1 ) $ 35.1 $ (0.6 ) $ 173.1 U.S. government agency securities — — — — — — Asset-backed securities (0.1 ) 58.8 (0.2 ) 154.8 (0.3 ) 213.6 Canadian government obligations and — 53.2 — — — 53.2 Canadian provincial bonds (0.1 ) 19.1 — 7.8 (0.1 ) 26.9 U.S. Treasury securities — 3.4 — 1.6 — 5.0 Municipal bonds — 12.9 (0.3 ) 10.6 (0.3 ) 23.5 Other securities (0.1 ) 10.5 (0.1 ) 8.0 (0.2 ) 18.5 $ (0.8 ) $ 295.9 $ (0.7 ) $ 217.9 $ (1.5 ) $ 513.8 |
Classification Of Corporate Investments On The Consolidated Balance Sheets | Classification of corporate investments on the Consolidated Balance Sheets is as follows: March 31, June 30, 2017 2016 Corporate investments: Cash and cash equivalents $ 2,995.5 $ 3,191.1 Short-term marketable securities (a) 3.2 23.5 Long-term marketable securities (b) 7.6 7.8 Total corporate investments $ 3,006.3 $ 3,222.4 |
Schedule Of Investment Of Funds Held For Clients | Funds held for clients have been invested in the following categories: March 31, June 30, 2017 2016 Funds held for clients: Restricted cash and cash equivalents held to satisfy client funds obligations $ 12,109.5 $ 12,267.5 Restricted short-term marketable securities held to satisfy client funds obligations 3,003.3 3,032.1 Restricted long-term marketable securities held to satisfy client funds obligations 18,774.3 18,541.6 Total funds held for clients $ 33,887.1 $ 33,841.2 |
Expected Maturities Of Available-For-Sale Securities | Expected maturities of available-for-sale securities at March 31, 2017 are as follows: One year or less $ 3,006.6 One year to two years 2,562.6 Two years to three years 4,923.3 Three years to four years 5,231.7 After four years 6,064.2 Total available-for-sale securities $ 21,788.4 |
Goodwill and Intangibles Asse28
Goodwill and Intangibles Assets, net (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes In Goodwill | Changes in goodwill for the nine months ended March 31, 2017 are as follows: Employer Services PEO Services Total Balance at June 30, 2016 $ 1,677.2 $ 4.8 $ 1,682.0 Additions and other adjustments, net 79.5 — 79.5 Currency translation adjustments (13.4 ) — (13.4 ) Disposition of CHSA and COBRA businesses (21.4 ) — (21.4 ) Balance at March 31, 2017 $ 1,721.9 $ 4.8 $ 1,726.7 |
Components Of Finite-Lived Intangible Assets | Components of intangible assets, net, are as follows: March 31, June 30, 2017 2016 Intangible assets: Software and software licenses $ 1,912.2 $ 1,811.6 Customer contracts and lists 607.4 603.7 Other intangibles 230.1 207.8 2,749.7 2,623.1 Less accumulated amortization: Software and software licenses (1,453.1 ) (1,403.8 ) Customer contracts and lists (496.3 ) (486.4 ) Other intangibles (205.5 ) (198.7 ) (2,154.9 ) (2,088.9 ) Intangible assets, net $ 594.8 $ 534.2 |
Schedule Of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated future amortization expenses of the Company's existing intangible assets are as follows: Amount Three months ending June 30, 2017 $ 44.8 Twelve months ending June 30, 2018 $ 162.7 Twelve months ending June 30, 2019 $ 127.0 Twelve months ending June 30, 2020 $ 95.7 Twelve months ending June 30, 2021 $ 74.3 Twelve months ending June 30, 2022 $ 57.0 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long Term Debt | The principal amounts and associated effective interest rates of the Notes and other debt as of March 31, 2017 and June 30, 2016 , are as follows: Debt instrument Effective Interest Rate March 31, 2017 June 30, 2016 Fixed-rate 2.250% notes due September 15, 2020 2.37% $ 1,000.0 $ 1,000.0 Fixed-rate 3.375% notes due September 15, 2025 3.47% 1,000.0 1,000.0 Other 20.9 22.3 2,020.9 2,022.3 Less: current portion (7.8 ) (2.5 ) Less: unamortized discount and debt issuance costs (10.6 ) (12.1 ) Total long-term debt $ 2,002.5 $ 2,007.7 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Components Of Stock-Based Compensation Expense | The following table represents stock-based compensation expense and related income tax benefits for the three months ended March 31, 2017 and 2016 , respectively: Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Operating expenses $ 4.6 $ 5.3 $ 16.4 $ 17.0 Selling, general and administrative expenses 25.1 22.6 71.0 72.7 System development and programming costs 4.6 3.8 13.8 12.7 Total pre-tax stock-based compensation expense $ 34.3 $ 31.7 $ 101.2 $ 102.4 Income tax benefit $ 12.5 $ 11.2 $ 36.3 $ 37.0 |
Changes In Stock Options Outstanding | Stock Options: Number of Options (in thousands) Weighted Average Price (in dollars) Options outstanding at July 1, 2016 4,869 $ 65 Options granted 1,234 $ 91 Options exercised (1,529 ) $ 56 Options canceled/forfeited (202 ) $ 79 Options outstanding at March 31, 2017 4,372 $ 75 |
Time Based Restricted Shares and Units | Time-Based Restricted Stock and Time-Based Restricted Stock Units: Number of Shares (in thousands) Number of Units (in thousands) Restricted shares/units outstanding at July 1, 2016 1,889 434 Restricted shares/units granted 884 202 Restricted shares/units vested (855 ) (202 ) Restricted shares/units forfeited (127 ) (36 ) Restricted shares/units outstanding at March 31, 2017 1,791 398 |
Performance Based Restricted shares and units | Performance-Based Restricted Stock and Performance-Based Restricted Stock Units: Number of Shares (in thousands) Number of Units (in thousands) Restricted shares/units outstanding at July 1, 2016 574 811 Restricted shares/units granted 172 313 Restricted shares/units vested (311 ) (272 ) Restricted shares/units forfeited (24 ) (77 ) Restricted shares/units outstanding at March 31, 2017 411 775 |
Assumptions Used To Estimate Fair Value For Stock Options Granted | The fair value for stock options granted was estimated at the date of grant using the following assumptions: Nine Months Ended March 31, 2017 2016 Risk-free interest rate 1.2 % 1.6 % Dividend yield 2.3 % 2.6 % Weighted average volatility factor 23.2 % 25.6 % Weighted average expected life (in years) 5.4 5.4 Weighted average fair value (in dollars) $ 14.36 $ 13.16 |
Schedule of Net Benefit Costs | The components of net pension expense were as follows: Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Service cost – benefits earned during the period $ 20.2 $ 17.6 $ 60.6 $ 52.8 Interest cost on projected benefits 14.9 16.8 45.0 50.6 Expected return on plan assets (33.9 ) (32.8 ) (101.9 ) (98.5 ) Net amortization and deferral 4.8 2.8 14.4 8.3 Net pension expense $ 6.0 $ 4.4 $ 18.1 $ 13.2 |
Commitments and Contingencies C
Commitments and Contingencies Commitments and Contingencies (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule Of Operating Leases Future Minimum Payments Due | In October 2016, the Company entered into a lease agreement in Tempe, Arizona in support of the Service Alignment Initiative (see Note 5), resulting in incremental obligations as follows: Years ending June 30, 2018 $ 1.4 2019 5.4 2020 5.5 2021 5.7 Thereafter 41.9 $ 59.9 |
Reclassifications out of Accu32
Reclassifications out of Accumulated Other Comprehensive Income ("AOCI") (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Reclassification out of Accumulated Other Comprehensive Income [Abstract] | |
Reclassification out of Accumulated Other Comprehensive Income | Changes in AOCI by component are as follows: Three Months Ended March 31, 2017 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at December 31, 2016 $ (298.0 ) $ 19.9 $ (288.6 ) $ (566.7 ) Other comprehensive income before reclassification adjustments 20.3 46.3 — 66.6 Tax effect — (16.5 ) — (16.5 ) Reclassification adjustments to — 0.2 (A) 5.1 (B) 5.3 Tax effect — (0.1 ) (1.8 ) (1.9 ) Balance at March 31, 2017 $ (277.7 ) $ 49.8 $ (285.3 ) $ (513.2 ) Three Months Ended March 31, 2016 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at December 31, 2015 $ (274.7 ) $ 68.1 $ (172.5 ) $ (379.1 ) Other comprehensive income before reclassification adjustments 41.2 271.8 — 313.0 Tax effect — (95.9 ) — (95.9 ) Reclassification adjustments to net earnings — 0.1 (A) 3.0 (B) 3.1 Tax effect — (0.1 ) (1.0 ) (1.1 ) Balance at March 31, 2016 $ (233.5 ) $ 244.0 $ (170.5 ) $ (160.0 ) Nine Months Ended March 31, 2017 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at June 30, 2016 $ (253.8 ) $ 333.8 $ (295.1 ) $ (215.1 ) Other comprehensive loss (23.9 ) (438.3 ) — (462.2 ) Tax effect — 155.1 — 155.1 Reclassification adjustments to — (1.1 ) (A) 15.3 (B) 14.2 Tax effect — 0.3 (5.5 ) (5.2 ) Balance at March 31, 2017 $ (277.7 ) $ 49.8 $ (285.3 ) $ (513.2 ) Nine Months Ended March 31, 2016 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive (Loss)/Income Balance at June 30, 2015 $ (228.3 ) $ 143.9 $ (176.2 ) $ (260.6 ) Other comprehensive (loss)/income (5.2 ) 150.8 — 145.6 Tax effect — (53.3 ) — (53.3 ) Reclassification adjustments to — 3.9 (A) 8.9 (B) 12.8 Tax effect — (1.3 ) (3.2 ) (4.5 ) Balance at March 31, 2016 $ (233.5 ) $ 244.0 $ (170.5 ) $ (160.0 ) (A) Reclassification adjustments out of AOCI are included within Other income, net, on the Statements of Consolidated Earnings. (B) Reclassification adjustments out of AOCI are included in net pension expense (see Note 12 ). |
Interim Financial Data by Seg33
Interim Financial Data by Segment Interim Financial Data by Segment (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Segment Results: Revenues from Continuing Operations Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Employer Services $ 2,627.2 $ 2,576.7 $ 7,197.8 $ 6,920.1 PEO Services 974.4 866.3 2,592.0 2,305.2 Other (2.1 ) (2.8 ) (8.2 ) 5.0 Reconciling item: Client fund interest (188.7 ) (191.6 ) (466.7 ) (460.8 ) $ 3,410.8 $ 3,248.6 $ 9,314.9 $ 8,769.5 Earnings from Continuing Operations before Income Taxes Three Months Ended Nine Months Ended March 31, March 31, 2017 2016 2017 2016 Employer Services $ 963.7 $ 956.2 $ 2,302.1 $ 2,146.2 PEO Services 120.0 97.9 341.5 279.9 Other (67.1 ) (67.7 ) (34.2 ) (157.6 ) Reconciling item: Client fund interest (188.7 ) (191.6 ) (466.7 ) (460.8 ) $ 827.9 $ 794.8 $ 2,142.7 $ 1,807.7 |
New Accounting Pronouncements (
New Accounting Pronouncements (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Item Effected [Line Items] | ||||
Income tax expense (benefit) | $ 240 | $ 262.3 | $ 675.1 | $ 596.3 |
Net cash flows provided by operating activities | 1,668.7 | 1,234.4 | ||
Net cash flows (used in) / provided by financing activities | (986.5) | 16,332.6 | ||
Accounting Standards Update 2016-09 | New Accounting Principles, Early Adoption | ||||
Item Effected [Line Items] | ||||
Income tax expense (benefit) | $ (9.5) | $ (29.9) | ||
Net cash flows provided by operating activities | 33.6 | |||
Net cash flows (used in) / provided by financing activities | $ 33.6 |
Acquisitions (Details)
Acquisitions (Details) $ in Millions | 9 Months Ended |
Mar. 31, 2017USD ($)acquisition | |
Business Combinations [Abstract] | |
Business combination, contingent consideration, liability | $ 35 |
Number of businesses acquired | acquisition | 2 |
Payments to acquire businesses, gross | $ 90 |
Term over which contingent consideration is payable | 3 years |
Divestitures (Details)
Divestitures (Details) - USD ($) $ in Millions | Nov. 28, 2016 | Sep. 01, 2015 |
Divestiture [Abstract] | ||
Disposal date | Nov. 28, 2016 | Sep. 1, 2015 |
Disposal group, not discontinued operation, gain (loss) on disposal | $ 205.4 | $ 29.1 |
Service Alignment Initiative (D
Service Alignment Initiative (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Mar. 31, 2017USD ($) | Mar. 31, 2017USD ($) | |
Restructuring Reserve [Roll Forward] | ||
Balance at June 30, 2016 | $ 0 | |
Charged to expense | $ 0.6 | 41.6 |
Cash payments | (7.3) | |
Non-cash utilization | (1.6) | |
Balance at March 31, 2017 | 32.7 | 32.7 |
Employee separation benefits | ||
Restructuring Reserve [Roll Forward] | ||
Balance at June 30, 2016 | 0 | |
Charged to expense | (0.1) | 37.2 |
Cash payments | (4.9) | |
Non-cash utilization | 0 | |
Balance at March 31, 2017 | 32.3 | 32.3 |
Other initiative costs | ||
Restructuring Reserve [Roll Forward] | ||
Balance at June 30, 2016 | 0 | |
Charged to expense | 0.7 | 4.4 |
Cash payments | (2.4) | |
Non-cash utilization | (1.6) | |
Balance at March 31, 2017 | 0.4 | 0.4 |
Minimum | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 100 | 100 |
Minimum | Employee separation benefits | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 75 | 75 |
Minimum | Other initiative costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 25 | 25 |
Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 125 | 125 |
Maximum | Employee separation benefits | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 85 | 85 |
Maximum | Other initiative costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 40 | $ 40 |
Earnings per Share (_EPS_) (Det
Earnings per Share (“EPS”) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share [Abstract] | ||||
Net earnings from continuing operations | $ 587.9 | $ 532.5 | $ 1,467.6 | $ 1,211.4 |
Basic weighted average shares outstanding (shares) | 446.5 | 454.4 | 448.9 | 458.2 |
Effect of Employee Stock Option Shares (shares) | 1.1 | 1 | 0.9 | 0.9 |
Effect of Employee Restricted Stock Shares (shares) | 1.6 | 1.5 | 1.5 | 1.5 |
Diluted weighted average shares outstanding (shares) | 449.2 | 456.9 | 451.3 | 460.6 |
Basic EPS from continuing operations (in US$ per share) | $ 1.32 | $ 1.17 | $ 3.27 | $ 2.64 |
Diluted EPS from continuing operations (in US$ per share) | $ 1.31 | $ 1.17 | $ 3.25 | $ 2.63 |
Options excluded from the calculation of diluted earnings per share (shares) | 0.9 | 0.9 | 1.7 |
Other Income, Net (Other Income
Other Income, Net (Other Income, Net) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Other Income and Expenses [Abstract] | ||||
Interest income on corporate funds | $ (10.1) | $ (9.7) | $ (54.5) | $ (45.6) |
Realized gains on available-for-sale securities | (0.6) | (2) | (3.1) | (3.5) |
Realized losses on available-for-sale securities | 0.8 | 2.1 | 2 | 7.4 |
Gain on sale of businesses (see Note 4) | 0 | (205.4) | ||
Gain on sale of businesses (see Note 4) | 0 | (29.1) | ||
Gain on sale of building | 0 | 0 | 0 | (13.9) |
Other income, net | $ (9.9) | $ (9.6) | $ (261) | $ (84.7) |
Corporate Investments and Fun40
Corporate Investments and Funds Held For Clients (Corporate Investments And Funds Held For Clients) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 | ||
Schedule of Available-for-sale Securities [Line Items] | ||||
Money market securities and other cash equivalents - Amortized Cost | $ 15,105 | $ 15,458.6 | ||
Money market securities and other cash equivalents - Gross Unrealized Gains | 0 | 0 | ||
Money market securities and other cash equivalents - Gross Unrealized Losses | 0 | 0 | ||
Money market securities and other cash equivalents - Fair Market Value | 15,105 | 15,458.6 | ||
Available-for-sale securities - Amortized Cost | 21,717.7 | 21,094.8 | ||
Available-for-sale securities - Gross Unrealized Gains | 163.1 | 511.7 | ||
Available-for-sale securities - Gross Unrealized Losses | (92.4) | (1.5) | ||
Available-for-sale securities - Fair Market Value | 21,788.4 | [1] | 21,605 | [2] |
Total corporate investments and funds held for clients - Amortized Cost | 36,822.7 | 36,553.4 | ||
Total corporate investments and funds held for clients - Gross Unrealized Gains | 163.1 | 511.7 | ||
Total corporate investments and funds held for clients - Gross Unrealized Losses | (92.4) | (1.5) | ||
Total corporate investments and funds held for clients - Fair Market Value | 36,893.4 | 37,063.6 | ||
Corporate Investments | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 10.8 | 31.3 | ||
Funds Held For Clients | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 21,777.6 | 21,573.7 | ||
Corporate bonds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 9,380.8 | 9,429.2 | ||
Available-for-sale securities - Gross Unrealized Gains | 86.4 | 261.8 | ||
Available-for-sale securities - Gross Unrealized Losses | (35) | (0.6) | ||
Available-for-sale securities - Fair Market Value | 9,432.2 | 9,690.4 | ||
U.S. government agency securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 3,731.6 | 4,298.8 | ||
Available-for-sale securities - Gross Unrealized Gains | 22.4 | 91.3 | ||
Available-for-sale securities - Gross Unrealized Losses | (16.5) | 0 | ||
Available-for-sale securities - Fair Market Value | 3,737.5 | 4,390.1 | ||
Asset-backed securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 4,384.9 | 3,761.9 | ||
Available-for-sale securities - Gross Unrealized Gains | 13.4 | 59 | ||
Available-for-sale securities - Gross Unrealized Losses | (13.3) | (0.3) | ||
Available-for-sale securities - Fair Market Value | 4,385 | 3,820.6 | ||
Canadian government obligations and Canadian government agency obligations | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 984.1 | 995.1 | ||
Available-for-sale securities - Gross Unrealized Gains | 4.7 | 12.8 | ||
Available-for-sale securities - Gross Unrealized Losses | (4.3) | 0 | ||
Available-for-sale securities - Fair Market Value | 984.5 | 1,007.9 | ||
Canadian provincial bonds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 741.3 | 735.4 | ||
Available-for-sale securities - Gross Unrealized Gains | 16.3 | 30.8 | ||
Available-for-sale securities - Gross Unrealized Losses | (0.8) | (0.1) | ||
Available-for-sale securities - Fair Market Value | 756.8 | 766.1 | ||
U.S. Treasury securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 1,389.1 | 746.9 | ||
Available-for-sale securities - Gross Unrealized Gains | 2.2 | 16.3 | ||
Available-for-sale securities - Gross Unrealized Losses | (18) | 0 | ||
Available-for-sale securities - Fair Market Value | 1,373.3 | 763.2 | ||
Municipal bonds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 615.7 | 594.2 | ||
Available-for-sale securities - Gross Unrealized Gains | 10.2 | 23.9 | ||
Available-for-sale securities - Gross Unrealized Losses | (2.9) | (0.3) | ||
Available-for-sale securities - Fair Market Value | 623 | 617.8 | ||
Other securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Amortized Cost | 490.2 | 533.3 | ||
Available-for-sale securities - Gross Unrealized Gains | 7.5 | 15.8 | ||
Available-for-sale securities - Gross Unrealized Losses | (1.6) | (0.2) | ||
Available-for-sale securities - Fair Market Value | $ 496.1 | $ 548.9 | ||
[1] | Included within available-for-sale securities are corporate investments with fair values of $10.8 million and funds held for clients with fair values of $21,777.6 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. | |||
[2] | Included within available-for-sale securities are corporate investments with fair values of $31.3 million and funds held for clients with fair values of $21,573.7 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
Corporate Investments and Fun41
Corporate Investments and Funds Held For Clients (Available-For-Sale Securities That Have Been In An Unrealized Loss Position) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | $ (92.1) | $ (0.8) |
Fair market value of securities in unrealized loss position less than 12 months | 9,358.4 | 295.9 |
Unrealized losses greater than 12 months | (0.3) | (0.7) |
Fair market value of securities in unrealized loss positions greater than 12 months | 33 | 217.9 |
Total gross unrealized losses | (92.4) | (1.5) |
Total fair market value | 9,391.4 | 513.8 |
Corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (35) | (0.5) |
Fair market value of securities in unrealized loss position less than 12 months | 2,986.3 | 138 |
Unrealized losses greater than 12 months | 0 | (0.1) |
Fair market value of securities in unrealized loss positions greater than 12 months | 7.4 | 35.1 |
Total gross unrealized losses | (35) | (0.6) |
Total fair market value | 2,993.7 | 173.1 |
U.S. government agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (16.5) | 0 |
Fair market value of securities in unrealized loss position less than 12 months | 2,093.3 | 0 |
Unrealized losses greater than 12 months | 0 | 0 |
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 0 |
Total gross unrealized losses | (16.5) | 0 |
Total fair market value | 2,093.3 | 0 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (13.3) | (0.1) |
Fair market value of securities in unrealized loss position less than 12 months | 2,261.3 | 58.8 |
Unrealized losses greater than 12 months | 0 | (0.2) |
Fair market value of securities in unrealized loss positions greater than 12 months | 12.4 | 154.8 |
Total gross unrealized losses | (13.3) | (0.3) |
Total fair market value | 2,273.7 | 213.6 |
Canadian government obligations and Canadian government agency obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (4.3) | 0 |
Fair market value of securities in unrealized loss position less than 12 months | 468.3 | 53.2 |
Unrealized losses greater than 12 months | 0 | 0 |
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 0 |
Total gross unrealized losses | (4.3) | 0 |
Total fair market value | 468.3 | 53.2 |
Canadian provincial bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (0.8) | (0.1) |
Fair market value of securities in unrealized loss position less than 12 months | 121.7 | 19.1 |
Unrealized losses greater than 12 months | 0 | 0 |
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 7.8 |
Total gross unrealized losses | (0.8) | (0.1) |
Total fair market value | 121.7 | 26.9 |
U.S. Treasury securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (18) | 0 |
Fair market value of securities in unrealized loss position less than 12 months | 1,167.2 | 3.4 |
Unrealized losses greater than 12 months | 0 | 0 |
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 1.6 |
Total gross unrealized losses | (18) | 0 |
Total fair market value | 1,167.2 | 5 |
Municipal bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (2.8) | 0 |
Fair market value of securities in unrealized loss position less than 12 months | 143.1 | 12.9 |
Unrealized losses greater than 12 months | (0.1) | (0.3) |
Fair market value of securities in unrealized loss positions greater than 12 months | 4.3 | 10.6 |
Total gross unrealized losses | (2.9) | (0.3) |
Total fair market value | 147.4 | 23.5 |
Other securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized losses less than 12 months | (1.4) | (0.1) |
Fair market value of securities in unrealized loss position less than 12 months | 117.2 | 10.5 |
Unrealized losses greater than 12 months | (0.2) | (0.1) |
Fair market value of securities in unrealized loss positions greater than 12 months | 8.9 | 8 |
Total gross unrealized losses | (1.6) | (0.2) |
Total fair market value | $ 126.1 | $ 18.5 |
Corporate Investments and Fun42
Corporate Investments and Funds Held For Clients (Narrative) (Details) - USD ($) $ in Millions | 9 Months Ended | |||
Mar. 31, 2017 | Jun. 30, 2016 | |||
Schedule of Available-for-sale Securities [Line Items] | ||||
Earliest Corporate bond debt maturity date | April 2,017 | |||
Latest corporate debt maturity date | March 2,025 | |||
Available-for-sale securities - Fair Market Value | $ 21,788.4 | [1] | $ 21,605 | [2] |
Earliest U.S. Treasury maturity date | June 2,017 | |||
Latest U.S Treasury maturity date | February 2,025 | |||
Length of shortest cash flow of residential mortgages used as collateral for companies mortgage backed securities (in years) | 15 years | |||
Length of longest cash flow of residential mortgages used as collateral for company's mortgage backed securities (in years) | 30 years | |||
Client Fund obligation repayment period | 1 year | |||
Client funds obligations | $ 33,816.7 | 33,331.8 | ||
Client funds investments with original maturities | ninety days or less | |||
Percentage of the available-for-sale securities were rated AAA Or AA | 81.00% | |||
Federal Home Loan Banks | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | $ 2,727.1 | |||
Federal Farm Credit Banks | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 801.8 | |||
Fixed Rate Credit Card | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 2,324.1 | |||
Asset-Backed Auto Loan Receivables | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 1,402.5 | |||
Asset-Backed Equipment Lease Receivable | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 418.4 | |||
Rate Reduction | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 239.9 | |||
Supranational Bonds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 168.5 | |||
Sovereign Bonds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 138.3 | |||
Residential Mortgage-Backed Securities | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 95.6 | |||
Level 1 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | 0 | 0 | ||
Level 3 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Available-for-sale securities - Fair Market Value | $ 0 | $ 0 | ||
[1] | Included within available-for-sale securities are corporate investments with fair values of $10.8 million and funds held for clients with fair values of $21,777.6 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. | |||
[2] | Included within available-for-sale securities are corporate investments with fair values of $31.3 million and funds held for clients with fair values of $21,573.7 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
Corporate Investments and Fun43
Corporate Investments and Funds Held For Clients (Classification Of Corporate Investments On The Consolidated Balance Sheets) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2015 |
Corporate Investments And Funds Held For Clients [Abstract] | ||||
Cash and cash equivalents | $ 2,995.5 | $ 3,191.1 | $ 2,941.4 | $ 1,639.3 |
Short-term marketable securities | 3.2 | 23.5 | ||
Long-term marketable securities | 7.6 | 7.8 | ||
Total corporate investments | $ 3,006.3 | $ 3,222.4 |
Corporate Investments and Fun44
Corporate Investments and Funds Held For Clients (Schedule Of Investment Of Funds Held For Clients) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 |
Corporate Investments And Funds Held For Clients [Abstract] | ||
Restricted cash and cash equivalents held to satisfy client funds obligations | $ 12,109.5 | $ 12,267.5 |
Restricted short-term marketable securities held to satisfy client funds obligations | 3,003.3 | 3,032.1 |
Restricted long-term marketable securities held to satisfy client funds obligations | 18,774.3 | 18,541.6 |
Total funds held for clients | $ 33,887.1 | $ 33,841.2 |
Corporate Investments and Fun45
Corporate Investments and Funds Held For Clients (Expected Maturities Of Available-For-Sale Securities) (Details) $ in Millions | Mar. 31, 2017USD ($) |
Corporate Investments And Funds Held For Clients [Abstract] | |
One year or less | $ 3,006.6 |
One year to two years | 2,562.6 |
Two years to three years | 4,923.3 |
Three years to four years | 5,231.7 |
After four years | 6,064.2 |
Total available-for-sale securities | $ 21,788.4 |
Goodwill and Intangibles Asse46
Goodwill and Intangibles Assets, net (Changes In Goodwill) (Details) $ in Millions | 9 Months Ended |
Mar. 31, 2017USD ($) | |
Goodwill [Roll Forward] | |
Balance at June 30, 2016 | $ 1,682 |
Additions and other adjustments, net | 79.5 |
Currency translation adjustments | (13.4) |
Disposition of CHSA and COBRA businesses | (21.4) |
Balance at March 31, 2017 | 1,726.7 |
Employer Services | |
Goodwill [Roll Forward] | |
Balance at June 30, 2016 | 1,677.2 |
Additions and other adjustments, net | 79.5 |
Currency translation adjustments | (13.4) |
Disposition of CHSA and COBRA businesses | (21.4) |
Balance at March 31, 2017 | 1,721.9 |
PEO Services | |
Goodwill [Roll Forward] | |
Balance at June 30, 2016 | 4.8 |
Additions and other adjustments, net | 0 |
Currency translation adjustments | 0 |
Disposition of CHSA and COBRA businesses | 0 |
Balance at March 31, 2017 | $ 4.8 |
Goodwill and Intangibles Asse47
Goodwill and Intangibles Assets, net (Components Of Finite-Lived Intangible Assets) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Jun. 30, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | $ 2,749.7 | $ 2,623.1 |
Total - accumulated amortization | (2,154.9) | (2,088.9) |
Intangible assets, net | 594.8 | 534.2 |
Software and software licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | 1,912.2 | 1,811.6 |
Total - accumulated amortization | (1,453.1) | (1,403.8) |
Customer contracts and lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | 607.4 | 603.7 |
Total - accumulated amortization | (496.3) | (486.4) |
Other intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | 230.1 | 207.8 |
Total - accumulated amortization | $ (205.5) | $ (198.7) |
Goodwill and Intangibles Asse48
Goodwill and Intangibles Assets, net (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible asset, useful life | 5 years | |||
Amortization of intangible assets | $ 40.4 | $ 39.6 | $ 125.8 | $ 113.3 |
Software and software licenses | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible asset, useful life | 4 years | |||
Customer contracts and lists | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible asset, useful life | 8 years | |||
Other intangibles | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible asset, useful life | 4 years |
Goodwill and Intangibles Asse49
Goodwill and Intangibles Assets, net (Schedule Of Finite-Lived Intangible Assets, Future Amortization Expense) (Details) $ in Millions | Mar. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Three months ending June 30, 2017 | $ 44.8 |
Twelve months ending June 30, 2018 | 162.7 |
Twelve months ending June 30, 2019 | 127 |
Twelve months ending June 30, 2020 | 95.7 |
Twelve months ending June 30, 2021 | 74.3 |
Twelve months ending June 30, 2022 | $ 57 |
Short-term Financing (Details)
Short-term Financing (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Short-term Debt [Line Items] | ||||
Short-term debt | $ 0 | $ 0 | ||
Commercial paper | 0 | $ 0 | ||
Maturities of short-term funding agreements | overnight to up to five business days | |||
Obligations under reverse repurchase agreements | 0 | $ 0 | $ 0 | $ 0 |
364-day credit agreement | ||||
Short-term Debt [Line Items] | ||||
Maximum borrowing capacity under credit facilities | 3,250,000,000 | $ 3,250,000,000 | ||
Term of credit agreement | 364 days | |||
Expiration date of credit facilities | Jun. 16, 2017 | |||
Extension option term | 1 year | |||
Credit facility maturing June 2020 | ||||
Short-term Debt [Line Items] | ||||
Maximum borrowing capacity under credit facilities | 2,250,000,000 | $ 2,250,000,000 | ||
Term of credit agreement | 5 years | |||
Expiration date of credit facilities | Jun. 17, 2020 | |||
Line of credit facility potentially available increase in maximum borrowing capacity | $ 500,000,000 | |||
Credit facility maturing June 2021 | ||||
Short-term Debt [Line Items] | ||||
Maximum borrowing capacity under credit facilities | 3,750,000,000 | $ 3,750,000,000 | ||
Term of credit agreement | 5 years | |||
Expiration date of credit facilities | Jun. 18, 2021 | |||
Line of credit facility potentially available increase in maximum borrowing capacity | $ 500,000,000 | |||
Commercial paper program | ||||
Short-term Debt [Line Items] | ||||
Aggregate amount of commercial paper issuable under the short-term commercial paper program | $ 9,250,000,000 | |||
Maturities of commercial paper range | overnight to up to 364 days | |||
Short-term debt, average outstanding amount | $ 1,100,000,000 | $ 1,300,000,000 | $ 3,200,000,000 | $ 2,700,000,000 |
Debt instrument, interest rate during period | 0.70% | 0.40% | 0.50% | 0.20% |
Commercial paper weighted average maturity | 1 day | 2 days | ||
Reverse repurchase agreements | ||||
Short-term Debt [Line Items] | ||||
Short-term debt, average outstanding amount | $ 145,000,000 | $ 128,000,000 | $ 258,100,000 | $ 316,900,000 |
Debt instrument, interest rate during period | 0.50% | 0.50% | 0.50% | 0.40% |
Long-term Debt (Details)
Long-term Debt (Details) - USD ($) | 9 Months Ended | |
Mar. 31, 2017 | Jun. 30, 2016 | |
Debt Instrument [Line Items] | ||
Aggregate principal amount | $ 2,000,000,000 | |
Notes payable | 2,020,900,000 | $ 2,022,300,000 |
Less: current portion | (7,800,000) | (2,500,000) |
Less: unamortized discount and debt issuance costs | (10,600,000) | (12,100,000) |
Total long-term debt | 2,002,500,000 | 2,007,700,000 |
Fair value of notes issued | $ 2,043,400,000 | |
Fixed-rate 2.250% notes due September 15, 2020 | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 5 years | |
Debt instrument stated rate (percent) | 2.25% | |
Debt instrument maturity date | Sep. 15, 2020 | |
Debt instrument effective rate (percent) | 2.37% | |
Notes payable | $ 1,000,000,000 | 1,000,000,000 |
Fixed-rate 3.375% notes due September 15, 2025 | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 10 years | |
Debt instrument stated rate (percent) | 3.375% | |
Debt instrument maturity date | Sep. 15, 2025 | |
Debt instrument effective rate (percent) | 3.47% | |
Notes payable | $ 1,000,000,000 | 1,000,000,000 |
Other | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 20,900,000 | $ 22,300,000 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Shares repurchased | 1.9 | 3.8 | 10.4 | 13.2 |
Nonvested Stock Options [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total remaining unrecognized compensation cost | $ 16.3 | $ 16.3 | ||
Weighted-average remaining requisite vesting period | 2 years 6 months 7 days | |||
Restricted Stock Units (RSUs) [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total remaining unrecognized compensation cost | 32.5 | $ 32.5 | ||
Weighted-average remaining requisite vesting period | 1 year 5 months | |||
Nonvested Restricted Stock [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total remaining unrecognized compensation cost | $ 80.9 | $ 80.9 | ||
Weighted-average remaining requisite vesting period | 1 year 3 months 1 day |
Employee Benefit Plans (Compone
Employee Benefit Plans (Components Of Stock-Based Compensation Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | $ 34.3 | $ 31.7 | $ 101.2 | $ 102.4 |
Income tax benefit | 12.5 | 11.2 | 36.3 | 37 |
Operating expenses | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | 4.6 | 5.3 | 16.4 | 17 |
Selling, general and administrative expenses | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | 25.1 | 22.6 | 71 | 72.7 |
System development and programming costs | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | $ 4.6 | $ 3.8 | $ 13.8 | $ 12.7 |
Employee Benefit Plans (Changes
Employee Benefit Plans (Changes In Stock Options Outstanding) (Details) shares in Thousands | 9 Months Ended |
Mar. 31, 2017$ / sharesshares | |
Number of Options (in thousands) | |
Options outstanding at July 1, 2016 | shares | 4,869 |
Options granted | shares | 1,234 |
Options exercised | shares | (1,529) |
Options canceled/forfeited | shares | (202) |
Options outstanding at September 30, 2016 | shares | 4,372 |
Weighted Average Price (in dollars) | |
Options outstanding at July 1, 2016 | $ / shares | $ 65 |
Options granted | $ / shares | 91 |
Options exercised | $ / shares | 56 |
Options canceled/forfeited | $ / shares | 79 |
Options outstanding at September 30, 2016 | $ / shares | $ 75 |
Employee Benefit Plans (Time-Ba
Employee Benefit Plans (Time-Based Restricted shares and units) (Details) shares in Thousands | 9 Months Ended |
Mar. 31, 2017shares | |
Time-Based Restricted Stock [Member] | |
Number of Shares (in thousands) | |
Restricted shares/units outstanding at July 1, 2016 | 1,889 |
Restricted shares/units granted | 884 |
Restricted shares/units vested | (855) |
Restricted shares/units forfeited | (127) |
Restricted shares/units outstanding at September 30, 2016 | 1,791 |
Time-Based Restricted Stock Units [Member] | |
Number of Shares (in thousands) | |
Restricted shares/units outstanding at July 1, 2016 | 434 |
Restricted shares/units granted | 202 |
Restricted shares/units vested | (202) |
Restricted shares/units forfeited | (36) |
Restricted shares/units outstanding at September 30, 2016 | 398 |
Employee Benefit Plans (Perform
Employee Benefit Plans (Performance based restricted shares and units) (Details) shares in Thousands | 9 Months Ended |
Mar. 31, 2017shares | |
Performance-Based Restricted Stock [Member] | |
Number of Shares (in thousands) | |
Restricted shares/units outstanding at July 1, 2016 | 574 |
Restricted shares/units granted | 172 |
Restricted shares/units vested | (311) |
Restricted shares/units forfeited | (24) |
Restricted shares/units outstanding at September 30, 2016 | 411 |
Performance Based Restricted Stock Unit [Domain] | |
Number of Shares (in thousands) | |
Restricted shares/units outstanding at July 1, 2016 | 811 |
Restricted shares/units granted | 313 |
Restricted shares/units vested | (272) |
Restricted shares/units forfeited | (77) |
Restricted shares/units outstanding at September 30, 2016 | 775 |
Employee Benefit Plans (Assumpt
Employee Benefit Plans (Assumptions Used To Estimate Fair Value For Stock Options Granted) (Details) - $ / shares | 9 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Arrangements with Employees and Nonemployees [Abstract] | ||
Risk-free interest rate | 1.20% | 1.60% |
Dividend yield | 2.30% | 2.60% |
Weighted average volatility factor | 23.20% | 25.60% |
Weighted average expected life (in years) | 5 years 4 months 24 days | 5 years 4 months 24 days |
Weighted average fair value (in dollars) | $ 14.36 | $ 13.16 |
Employee Benefit Plans (Compo58
Employee Benefit Plans (Components Of Net Pension Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | ||||
Service cost – benefits earned during the period | $ 20.2 | $ 17.6 | $ 60.6 | $ 52.8 |
Interest cost on projected benefits | 14.9 | 16.8 | 45 | 50.6 |
Expected return on plan assets | (33.9) | (32.8) | (101.9) | (98.5) |
Net amortization and deferral | 4.8 | 2.8 | 14.4 | 8.3 |
Net pension expense | $ 6 | $ 4.4 | $ 18.1 | $ 13.2 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Tax Credit [Line Items] | ||||
Effective income tax rate, percent | 29.00% | 33.00% | 31.50% | 33.00% |
New Accounting Principles, Early Adoption | Accounting Standards Update 2016-09 | ||||
Tax Credit [Line Items] | ||||
Effective income tax rate reconciliation, deduction, percent | 1.20% | 1.40% | ||
Domestic Production Activity Deduction and Research Tax Credit [Member] | ||||
Tax Credit [Line Items] | ||||
Effective income tax rate reconciliation, deduction, percent | 6.30% | 2.40% |
Commitments and Contingencies S
Commitments and Contingencies Schedule of Operating Leases Future Minimum Payments Due (Details) $ in Millions | 9 Months Ended |
Mar. 31, 2017USD ($)patent | |
Commitments and Contingencies Disclosure [Abstract] | |
Loss Contingency, Patents Allegedly Infringed, Number | patent | 4 |
2,018 | $ 1.4 |
2,019 | 5.4 |
2,020 | 5.5 |
2,021 | 5.7 |
Thereafter | 41.9 |
Total | $ 59.9 |
Reclassifications out of Accu61
Reclassifications out of Accumulated Other Comprehensive Income ("AOCI") (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | $ (566.7) | $ (379.1) | $ (215.1) | $ (260.6) | |
Other comprehensive (loss)/income before reclassification adjustments | 66.6 | 313 | (462.2) | 145.6 | |
Tax effect | (16.5) | (95.9) | 155.1 | (53.3) | |
Reclassification adjustments to net earnings | 5.3 | 3.1 | 14.2 | 12.8 | |
Tax effect | (1.9) | (1.1) | (5.2) | (4.5) | |
Accumulated other comprehensive income, ending balance | (513.2) | (160) | (513.2) | (160) | |
Currency Translation Adjustment | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | (298) | (274.7) | (253.8) | (228.3) | |
Other comprehensive (loss)/income before reclassification adjustments | 20.3 | 41.2 | (23.9) | (5.2) | |
Tax effect | 0 | 0 | 0 | 0 | |
Reclassification adjustments to net earnings | 0 | 0 | 0 | 0 | |
Tax effect | 0 | 0 | 0 | 0 | |
Accumulated other comprehensive income, ending balance | (277.7) | (233.5) | (277.7) | (233.5) | |
Net Gains/Losses on Available-for-sale Securities | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | 19.9 | 68.1 | 333.8 | 143.9 | |
Other comprehensive (loss)/income before reclassification adjustments | 46.3 | 271.8 | (438.3) | 150.8 | |
Tax effect | (16.5) | (95.9) | 155.1 | (53.3) | |
Reclassification adjustments to net earnings | [1] | 0.2 | 0.1 | (1.1) | 3.9 |
Tax effect | (0.1) | (0.1) | 0.3 | (1.3) | |
Accumulated other comprehensive income, ending balance | 49.8 | 244 | 49.8 | 244 | |
Pension Liability | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | (288.6) | (172.5) | (295.1) | (176.2) | |
Other comprehensive (loss)/income before reclassification adjustments | 0 | 0 | 0 | 0 | |
Tax effect | 0 | 0 | 0 | 0 | |
Reclassification adjustments to net earnings | [2] | 5.1 | 3 | 15.3 | 8.9 |
Tax effect | (1.8) | (1) | (5.5) | (3.2) | |
Accumulated other comprehensive income, ending balance | $ (285.3) | $ (170.5) | $ (285.3) | $ (170.5) | |
[1] | (A) Reclassification adjustments out of AOCI are included within Other income, net, on the Statements of Consolidated Earnings. | ||||
[2] | (B) Reclassification adjustments out of AOCI are included in net pension expense (see Note 12). |
Interim Financial Data by Seg62
Interim Financial Data by Segment (Narrative) (Details) | 9 Months Ended |
Mar. 31, 2017segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Standard reconciling rate between actual interest income earned and interest credited | 4.50% |
Interim Financial Data by Seg63
Interim Financial Data by Segment (Financial Data By Strategic Business Unit Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting Information [Line Items] | ||||
Revenues from Continuing Operations | $ 3,410.8 | $ 3,248.6 | $ 9,314.9 | $ 8,769.5 |
Earnings from Continuing Operations before Income Taxes | 827.9 | 794.8 | 2,142.7 | 1,807.7 |
Employer Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from Continuing Operations | 2,627.2 | 2,576.7 | 7,197.8 | 6,920.1 |
Earnings from Continuing Operations before Income Taxes | 963.7 | 956.2 | 2,302.1 | 2,146.2 |
PEO Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from Continuing Operations | 974.4 | 866.3 | 2,592 | 2,305.2 |
Earnings from Continuing Operations before Income Taxes | 120 | 97.9 | 341.5 | 279.9 |
Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from Continuing Operations | (2.1) | (2.8) | (8.2) | 5 |
Earnings from Continuing Operations before Income Taxes | (67.1) | (67.7) | (34.2) | (157.6) |
Client Fund Interest Reconciling Item [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from Continuing Operations | (188.7) | (191.6) | (466.7) | (460.8) |
Earnings from Continuing Operations before Income Taxes | $ (188.7) | $ (191.6) | $ (466.7) | $ (460.8) |