Cover page
Cover page - shares | 9 Months Ended | |
Mar. 31, 2020 | Apr. 28, 2020 | |
Cover [Abstract] | ||
Title of 12(b) Security | Common Stock, $0.10 Par Value(voting) | |
Document Transition Report | false | |
Document Quarterly Report | true | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 22-1467904 | |
Entity Address, Address Line One | One ADP Boulevard | |
Entity Address, City or Town | Roseland, | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Entity File Number | 1-5397 | |
Entity Registrant Name | AUTOMATIC DATA PROCESSING, INC. | |
City Area Code | 973 | |
Local Phone Number | 974-5000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Central Index Key | 0000008670 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Large Accelerated Filer | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Common Stock, Shares Outstanding | 429,774,376 | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07068 | |
Trading Symbol | ADP | |
Security Exchange Name | NASDAQ | |
Entity Small Business | false | |
Entity Emerging Growth Company | false |
Statements of Consolidated Earn
Statements of Consolidated Earnings - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | ||
REVENUES: | |||||
Revenues, other than interest on funds held for clients and PEO revenues | $ 2,652.1 | $ 2,546.9 | $ 7,356.7 | $ 7,084.7 | |
Interest on funds held for clients | 158.9 | 167.4 | 430.4 | 415 | |
PEO revenues (A) | [1] | 1,236.8 | 1,113.9 | 3,425.9 | 3,131.2 |
TOTAL REVENUES | 4,047.8 | 3,828.2 | 11,213 | 10,630.9 | |
Costs of revenues: | |||||
Operating expenses | 1,974.1 | 1,855.3 | 5,597.8 | 5,324.8 | |
Systems development and programming costs | 172.1 | 160.1 | 509 | 474.2 | |
Depreciation and amortization | 92.9 | 77.2 | 271.2 | 221.5 | |
TOTAL COSTS OF REVENUES | 2,239.1 | 2,092.6 | 6,378 | 6,020.5 | |
Selling, general, and administrative expenses | 756.6 | 750.4 | 2,237.4 | 2,209.4 | |
Interest expense | 20 | 21.7 | 91.5 | 96.2 | |
TOTAL EXPENSES | 3,015.7 | 2,864.7 | 8,706.9 | 8,326.1 | |
Other income, net | (44.6) | (21) | (145.2) | (67.5) | |
EARNINGS BEFORE INCOME TAXES | 1,076.7 | 984.5 | 2,651.3 | 2,372.3 | |
Provision for income taxes | 255.8 | 230.8 | 596.4 | 554.9 | |
NET EARNINGS | $ 820.9 | $ 753.7 | $ 2,054.9 | $ 1,817.4 | |
Basic earnings per share (in US$ per share) | $ 1.91 | $ 1.74 | $ 4.76 | $ 4.17 | |
Diluted earnings per share (in US$ per share) | $ 1.90 | $ 1.73 | $ 4.74 | $ 4.15 | |
Basic weighted average shares outstanding (shares) | 430 | 434.1 | 431.4 | 435.5 | |
Diluted weighted average shares outstanding (shares) | 431.8 | 436.6 | 433.5 | 438.1 | |
[1] | Professional Employer Organization (“PEO”) revenues are net of direct pass-through costs, primarily consisting of payroll wages and payroll taxes of $12,643.6 million and $10,798.3 million for the three months ended March 31, 2020 and 2019, respectively, and $35,525.8 million and $32,178.8 million for the nine months ended March 31, 2020 and 2019, respectively. |
Statements of Consolidated Ea_2
Statements of Consolidated Earnings (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||||
Direct pass-through costs PEO revenues | $ 12,643.6 | $ 10,798.3 | $ 35,525.8 | $ 32,178.8 |
Statements of Consolidated Comp
Statements of Consolidated Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 820.9 | $ 753.7 | $ 2,054.9 | $ 1,817.4 |
Other comprehensive income/(loss): | ||||
Currency translation adjustments | (68.4) | (2.3) | (83) | (49.9) |
Unrealized net gains/(losses) on available-for-sale securities | 139.3 | 259 | 199.9 | 377 |
Tax effect | (32.2) | (58) | (45.4) | (84.8) |
Reclassification of net (gain)/losses on available-for-sale securities to net earnings | (2.5) | (0.1) | (11.9) | 1.4 |
Tax effect | 0.6 | 0 | 2.6 | (0.2) |
Unrealized loss on cash flow hedging activities | (38.2) | 0 | (37.4) | 0 |
Tax effect | 9.5 | 0 | 9.2 | 0 |
Reclassification of pension liability adjustment to net earnings | (15) | 6.1 | (14.8) | 32.5 |
Tax effect | 3.7 | (1.6) | 3.7 | (8.1) |
Other comprehensive income/(loss), net of tax | (3.2) | 203.1 | 22.9 | 267.9 |
Comprehensive income | $ 817.7 | $ 956.8 | $ 2,077.8 | $ 2,085.3 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2020 | Jun. 30, 2019 | |
Current assets: | |||
Cash and cash equivalents | $ 1,705 | $ 1,949.2 | |
Short-term marketable securities | 3.2 | 10.5 | |
Accounts receivable, net of allowance for doubtful accounts of $84.8 and $54.9, respectively | 2,620.6 | 2,439.3 | |
Other current assets | 545.5 | 509.1 | |
Total current assets before funds held for clients | 4,874.3 | 4,908.1 | |
Funds held for clients | 30,834.4 | 29,434.2 | |
Total current assets | 35,708.7 | 34,342.3 | |
Long-term receivables, net of allowance for doubtful accounts of $0.6 and $0.4, respectively | 21.6 | 23.8 | |
Property, plant and equipment, net | 743.1 | 764.2 | |
Operating lease right-of-use asset | 521.1 | 0 | |
Deferred contract costs | 2,403 | 2,428.5 | |
Other assets | 579.9 | 934.4 | |
Goodwill | 2,299.3 | 2,323 | |
Intangible assets, net | 1,106.7 | 1,071.5 | |
Total assets | 43,383.4 | 41,887.7 | |
Current liabilities: | |||
Accounts payable | 115.5 | 125.5 | |
Accrued expenses and other current liabilities | 1,978.7 | 1,759 | |
Accrued payroll and payroll-related expenses | 564 | 721.1 | |
Dividends payable | 387.9 | 340.1 | |
Short-term deferred revenues | 215.8 | 220.7 | |
Obligations under reverse repurchase agreements (A) | [1] | 0 | 262 |
Short-term debt | 1,001.8 | 0 | |
Income taxes payable | 50.1 | 54.8 | |
Total current liabilities before client funds obligations | 4,313.8 | 3,483.2 | |
Client funds obligations | 30,359 | 29,144.5 | |
Total current liabilities | 34,672.8 | 32,627.7 | |
Long-term debt | 1,002.8 | 2,002.2 | |
Operating lease liabilities | 361.2 | 0 | |
Other liabilities | 745.6 | 798.7 | |
Deferred income taxes | 732.2 | 659.9 | |
Long-term deferred revenues | 378.1 | 399.3 | |
Total liabilities | 37,892.7 | 36,487.8 | |
Commitments and contingencies (Note 13) | |||
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, 2020 and June 30, 2019; outstanding, 429.8 and 434.2 shares at March 31, 2020 and June 30, 2019, respectively | 63.9 | 63.9 | |
Capital in excess of par value | 1,315.1 | 1,183.2 | |
Retained earnings | 18,416.5 | 17,500.6 | |
Treasury stock - at cost: 208.9 and 204.5 shares at March 31, 2020 and June 30, 2019, respectively | (14,070.4) | (13,090.5) | |
Accumulated other comprehensive loss | (234.4) | (257.3) | |
Total stockholders’ equity | 5,490.7 | 5,399.9 | |
Total liabilities and stockholders’ equity | $ 43,383.4 | $ 41,887.7 | |
Preferred stock, par value (in US$ per share) | $ 1 | $ 1 | |
Preferred stock, shares authorized (in shares) | 300,000 | 300,000 | |
Preferred stock, shares issued (in shares) | 0 | 0 | |
Common stock, shares issued (in shares) | 638,700,000 | 638,700,000 | |
Common stock, par value (in US$ per share) | $ 0.10 | $ 0.10 | |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 | |
[1] | (A) As of June 30, 2019, $261.4 million of long-term marketable securities and $0.6 million of cash and cash equivalents have been pledged as collateral under the Company's reverse repurchase agreements. Refer to Note 9 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Jun. 30, 2019 |
Statement of Financial Position [Abstract] | ||
Long-term marketable securities under reverse repurchase agreements | $ 261.4 | |
Cash And Cash Equivalents Under Reverse Repurchase Agreements | 0.6 | |
Allowance for doubtful accounts - trade receivables - Current | $ 84.8 | 54.9 |
Allowance for doubtful accounts - trade receivables - Long-term | $ 0.6 | $ 0.4 |
Preferred stock, par value (in US$ per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 300,000 | 300,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in US$ per share) | $ 0.10 | $ 0.10 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 638,700,000 | 638,700,000 |
Common stock, shares outstanding (in shares) | 429,800,000 | 434,200,000 |
Treasury stock, (in shares) | 208,900,000 | 204,500,000 |
Statements of Consolidated Cash
Statements of Consolidated Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net earnings | $ 2,054.9 | $ 1,817.4 |
Adjustments to reconcile net earnings to cash flows provided by operating activities: | ||
Depreciation and amortization | 355.5 | 299.6 |
Amortization of deferred contract costs | 687.4 | 655.2 |
Deferred income taxes | 57.7 | 4.1 |
Stock-based compensation expense | 106.7 | 122.2 |
Net pension expense | (14.6) | 41 |
Net amortization of premiums and accretion of discounts on available-for-sale securities | 40.7 | 38.9 |
Impairment of intangible assets | 0 | 12.1 |
Gain on sale of assets | (2.1) | (4.1) |
Other | 44.9 | 25.3 |
Changes in operating assets and liabilities, net of effects from acquisitions: | ||
Increase in accounts receivable | (281.6) | (526.7) |
Increase in other assets | (762.3) | (748.9) |
(Decrease) / increase in accounts payable | (3.6) | 25.4 |
(Decrease) / increase in accrued expenses and other liabilities | (34) | 194.5 |
Net cash flows provided by operating activities | 2,249.6 | 1,956 |
Cash Flows from Investing Activities: | ||
Purchases of corporate and client funds marketable securities | (3,894.6) | (2,725.8) |
Proceeds from the sales and maturities of corporate and client funds marketable securities | 4,749.9 | 2,090.6 |
Capital expenditures | (139.3) | (120.3) |
Additions to intangibles | (261) | (329.9) |
Acquisitions of businesses, net of cash acquired | 0 | (120.4) |
Proceeds from the sale of property, plant, and equipment and other assets | 23.6 | 7.9 |
Net cash flows provided by / (used in) investing activities | 478.6 | (1,197.9) |
Cash Flows from Financing Activities: | ||
Net increase in client funds obligations | 1,351.5 | 8,612 |
Payments of debt | (1.6) | (1.6) |
Repurchases of common stock | (1,006.3) | (760.6) |
Net proceeds from stock purchase plan and stock-based compensation plans | 33.3 | 50.5 |
Dividends paid | (1,078.9) | (949.6) |
Net payments of reverse repurchase agreements | (262) | 0 |
Other | 0 | (5.3) |
Net Cash Provided by (Used in) Financing Activities, Total | (964) | 6,945.4 |
Effect of exchange rate changes on cash, cash equivalents, restricted cash, and restricted cash equivalents | (41.4) | (34.1) |
Net change in cash, cash equivalents, restricted cash, and restricted cash equivalents | 1,722.8 | 7,669.4 |
Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of period | 6,796.2 | 6,542.1 |
Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period | 8,519 | 14,211.5 |
Reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents to the Consolidated Balance Sheets | ||
Total cash, cash equivalents, restricted cash, and restricted cash equivalents | 8,519 | 14,211.5 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 103.8 | 108.6 |
Cash paid for income taxes, net of income tax refunds | $ 520.2 | $ 437.7 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Mar. 31, 2020 | |
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., its subsidiaries and variable interest entity (“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 Company has a grantor trust, which holds the majority of the funds provided by its clients pending remittance to employees of those clients, tax authorities, and other payees. The Company is the sole beneficial owner of the trust. The trust meets the criteria in Accounting Standards Codification (“ASC”) 810, “Consolidation” to be characterized as a variable interest entity (“VIE”). The Company has determined that it has a controlling financial interest in the trust because it has both (1) the power to direct the activities that most significantly impact the economic performance of the trust (including the power to make all investment decisions for the trust) and (2) the right to receive benefits that could potentially be significant to the trust (in the form of investment returns) and, therefore, consolidates the trust. Further information on these funds and the Company’s obligations to remit to its clients’ employees, tax authorities, and other payees is provided in Note 6, “Corporate Investments and Funds Held for Clients.” 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. 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, 2019 (“fiscal 2019”). Revision of Previously Reported Financial Information The Company has historically classified certain fees collected from worksite employers for certain benefits within PEO revenues, and the associated costs of these benefits have historically been classified within operating expenses as PEO zero-margin benefits pass-through costs in the Company's Statements of Consolidated Earnings. During the quarter ended September 30, 2019, management determined that the Company does not retain risk and is acting as the agent, rather than as the primary obligor, for a portion of the fees collected for worksite employee benefits and the worksite employer is primarily responsible for fulfilling certain aspects of the service and has discretion in establishing price. Accordingly, the accompanying Statements of Consolidated Earnings for the three and nine months ended March 31, 2019 have been revised to correct the amounts previously reported on a gross basis to a net basis by reducing PEO revenues and operating expenses for associated costs of an equal amount, as follows: Three Months Ended March 31, 2019 As reported Revision As revised PEO revenues $ 1,133.1 (19.2) $ 1,113.9 TOTAL REVENUES 3,847.4 (19.2) 3,828.2 Operating expenses 1,874.5 (19.2) 1,855.3 Total Expenses 2,883.9 (19.2) 2,864.7 EARNINGS BEFORE INCOME TAXES 984.5 — 984.5 Provision for income taxes 230.8 — 230.8 NET EARNINGS $ 753.7 — $ 753.7 Nine Months Ended March 31, 2019 As reported Revision As revised PEO revenues $ 3,176.8 (45.6) $ 3,131.2 TOTAL REVENUES 10,676.5 (45.6) 10,630.9 Operating expenses 5,370.4 (45.6) 5,324.8 Total Expenses 8,371.7 (45.6) 8,326.1 EARNINGS BEFORE INCOME TAXES 2,372.3 — 2,372.3 Provision for income taxes 554.9 — 554.9 NET EARNINGS $ 1,817.4 — $ 1,817.4 The correction of these previously reported amounts had no impact on the Company's earnings before income taxes, net earnings, consolidated financial condition or cash flows. In addition, corresponding revisions have been made elsewhere in the Company's consolidated footnote disclosures, where applicable, including its Interim Financial Data by Segment disclosure. |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted Accounting Pronouncements Effective July 1, 2019, the Company adopted accounting standard update (“ASU”) 2016-02, “Leases (ASC 842)” under the optional transition method. As a result, the Company recorded on the Consolidated Balance Sheets total operating lease right-of-use (“ROU”) assets of $573.3 million and total operating lease liabilities of $522.6 million, as of the adoption date. The adoption did not have an impact on our Statements of Consolidated Earnings or Statements of Consolidated Cash Flows. Refer to Note 7 for further details. Recently Issued Accounting Pronouncements The following table summarizes recent ASU's issued by the Financial Accounting Standards Board (“FASB”) which have been assessed: Standard Description Effective Date Effect on Financial Statements or Other Significant Matters ASU 2020-04 Reference Rate Reform This update provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate (LIBOR) reform on financial reporting. March 12, 2020 The Company is assessing the effects of the Reference Rate Reform. The Company has not yet determined the impact of this ASU on its consolidated results of operations, financial condition, or cash flows. ASU 2018-14 Compensation-Retirement Benefits-Defined Benefit Plans This update modifies the disclosure requirements for employers that sponsor defined benefit pension or other post-retirement plans by removing and adding certain disclosures for these plans. The eliminated disclosures include (a) the amounts in accumulated other comprehensive income expected to be recognized in net periodic benefit costs over the next fiscal year, and (b) the effects of a one percentage point change in assumed health care cost trend rates on the net periodic benefit costs and the benefit obligation for post-retirement health care benefits. Additional disclosures include descriptions of significant gains and losses affecting the benefit obligation for the period. The amendments in ASU 2018-14 would need to be applied on a retrospective basis. July 1, 2021 The adoption of this guidance will modify disclosures but will not have an impact on the Company's consolidated results of operations, financial condition, or cash flows. ASU 2018-13 Fair Value Measurement This update modifies the disclosure requirements on fair value measurements. Certain disclosures in ASU 2018-13 would need to be applied on a retrospective basis and others on a prospective basis. July 1, 2020 The adoption of this guidance will modify disclosures but will not have an impact on the Company's consolidated results of operations, financial condition, or cash flows. ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This update introduces the current expected credit loss (CECL) model, which will require an entity to measure credit losses for certain financial instruments and financial assets, including trade receivables. Under this update, on initial recognition and at each reporting period, an entity will be required to recognize an allowance that reflects the entity’s current estimate of credit losses expected to be incurred over the life of the financial instrument. In addition, this update modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. In November 2019, the FASB issued Accounting Standard Update 2019-11 Codification Improvements to Topic 326, Financial-Credit Losses which provides clarification and eliminates inconsistencies to amendments included in Update 2016-13. July 1, 2020 The Company is evaluating the impact of this ASU on its consolidated results of operations, financial condition, or cash flows. |
Revenue
Revenue | 9 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Based upon similar operational and economic characteristics, the Company’s revenues are disaggregated by its three strategic pillars: Human Capital Management (“HCM”), HR Outsourcing (“HRO”), and Global (“Global”) Solutions, with separate disaggregation for PEO zero-margin benefits pass-through revenues and client fund interest revenues. The Company believes these revenue categories depict how the nature, amount, timing, and uncertainty of its revenue and cash flows are affected by economic factors. HCM provides a suite of product offerings that assist employers of all types and sizes in all stages of the employment cycle, from recruitment to retirement. Global is generally consistent with the types of services provided within HCM but represents geographies outside of the United States and includes our multinational offerings. HCM and Global revenues are primarily attributable to fees for providing solutions for payroll, benefits, talent, retirement services and HR processing and fees charged to implement the Company's solutions for clients. HRO provides a comprehensive human resources outsourcing solution, including offering benefits, providing workers’ compensation insurance, and administering state unemployment insurance, among other human resources functions. This revenue is primarily driven by the PEO. Amounts collected from PEO worksite employers include payroll, fees for benefits, and an administrative fee that also includes payroll taxes, fees for workers’ compensation and state unemployment taxes. The payroll and payroll taxes collected from the worksite employers are presented in revenue net, as the Company does not retain risk and acts as an agent with respect to this aspect of the PEO arrangement. With respect to the payroll and payroll taxes, the worksite employer is primarily responsible for providing the service and has discretion in establishing wages. The fees collected from the worksite employers for benefits (i.e., PEO benefits pass-throughs), workers’ compensation and state unemployment taxes are presented in revenues and the associated costs of benefits, workers’ compensation and state unemployment taxes are included in operating expenses, as the Company acts as a principal with respect to this aspect of the arrangement. With respect to these fees, the Company is primarily responsible for fulfilling the service and has discretion in establishing price. The Company has further disaggregated HRO to separate out its PEO zero-margin benefits pass-through revenues. The Company recognizes client fund interest revenues on collected but not yet remitted funds held for clients in revenues as earned, as the collection, holding and remittance of these funds are critical components of providing these services. The following tables provide details of revenue by our strategic pillars with disaggregation for PEO zero-margin benefits pass-throughs and client fund interest, and include a reconciliation to the Company’s reportable segments: Three Months Ended Nine Months Ended March 31, March 31, Types of Revenues 2020 2019 2020 2019 HCM $ 1,858.3 $ 1,771.4 $ 5,074.8 $ 4,886.1 HRO, excluding PEO zero-margin benefits pass-throughs 742.4 678.7 1,983.6 1,855.4 PEO zero-margin benefits pass-throughs 747.9 665.3 2,169.4 1,965.5 Global 540.3 545.4 1,554.8 1,508.9 Interest on funds held for clients 158.9 167.4 430.4 415.0 Total Revenues $ 4,047.8 $ 3,828.2 $ 11,213.0 $ 10,630.9 Reconciliation of disaggregated revenue to our reportable segments for the three months ended March 31, 2020: Types of Revenues Employer Services PEO Other Total HCM $ 1,859.8 $ — $ (1.5) $ 1,858.3 HRO, excluding PEO zero-margin benefits pass-throughs 254.1 489.0 (0.7) 742.4 PEO zero-margin benefits pass-throughs — 747.9 — 747.9 Global 540.3 — — 540.3 Interest on funds held for clients 157.5 1.4 — 158.9 Total Segment Revenues $ 2,811.7 $ 1,238.3 $ (2.2) $ 4,047.8 Reconciliation of disaggregated revenue to our reportable segments for the three months ended March 31, 2019: Types of Revenues Employer Services PEO Other Total HCM $ 1,774.7 $ — $ (3.3) $ 1,771.4 HRO, excluding PEO zero-margin benefits pass-throughs 233.2 448.6 (3.1) 678.7 PEO zero-margin benefits pass-throughs — 665.3 — 665.3 Global 545.4 — — 545.4 Interest on funds held for clients 165.8 1.6 — 167.4 Total Segment Revenues $ 2,719.1 $ 1,115.5 $ (6.4) $ 3,828.2 Reconciliation of disaggregated revenue to our reportable segments for the nine months ended March 31, 2020: Types of Revenues Employer Services PEO Other Total HCM $ 5,079.6 $ — $ (4.8) $ 5,074.8 HRO, excluding PEO zero-margin benefits pass-throughs 729.7 1,256.5 (2.6) 1,983.6 PEO zero-margin benefits pass-throughs — 2,169.4 — 2,169.4 Global 1,554.8 — — 1,554.8 Interest on funds held for clients 426.5 3.9 — 430.4 Total Segment Revenues $ 7,790.6 $ 3,429.8 $ (7.4) $ 11,213.0 Reconciliation of disaggregated revenue to our reportable segments for the nine months ended March 31, 2019: Types of Revenues Employer Services PEO Other Total HCM $ 4,891.1 $ — $ (5.0) $ 4,886.1 HRO, excluding PEO zero-margin benefits pass-throughs 696.6 1,165.7 (6.9) 1,855.4 PEO zero-margin benefits pass-throughs — 1,965.5 — 1,965.5 Global 1,508.9 — — 1,508.9 Interest on funds held for clients 411.1 3.9 — 415.0 Total Segment Revenues $ 7,507.7 $ 3,135.1 $ (11.9) $ 10,630.9 Contract Balances The timing of revenue recognition for HCM, HRO and Global Solutions is consistent with the invoicing of clients, as invoicing occurs in the period the services are provided. Therefore, the Company does not recognize a contract asset or liability resulting from the timing of revenue recognition and invoicing. Changes in deferred revenue related to set up fees for the nine months ended March 31, 2020 were as follows: Contract Liability Contract liability, July 1, 2019 $ 563.4 Recognition of revenue included in beginning of year contract liability (129.7) Contract liability, net of revenue recognized on contracts during the period 107.6 Currency adjustments (6.7) Contract liability, March 31, 2020 $ 534.6 |
Earnings per Share (EPS)
Earnings per Share (EPS) | 9 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share (EPS) | Earnings per Share (“EPS”) Basic Effect of Employee Stock Option Shares Effect of Diluted Three Months Ended March 31, 2020 Net earnings $ 820.9 $ 820.9 Weighted average shares (in millions) 430.0 0.9 0.9 431.8 EPS $ 1.91 $ 1.90 Three Months Ended March 31, 2019 Net earnings $ 753.7 $ 753.7 Weighted average shares (in millions) 434.1 1.2 1.3 436.6 EPS $ 1.74 $ 1.73 Nine Months Ended March 31, 2020 Net earnings $ 2,054.9 $ 2,054.9 Weighted average shares (in millions) 431.4 1.1 1.0 433.5 EPS $ 4.76 $ 4.74 Nine Months Ended March 31, 2019 Net earnings $ 1,817.4 $ 1,817.4 Weighted average shares (in millions) 435.5 1.3 1.3 438.1 EPS $ 4.17 $ 4.15 Options to purchase 1.3 million and 0.8 million shares of common stock for the three months ended March 31, 2020 and 2019, respectively, and 1.1 million and 0.6 million shares of common stock for the nine months ended March 31, 2020 and 2019, 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, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income, Net | Other Income, Net Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Interest income on corporate funds $ (12.1) $ (15.0) $ (70.1) $ (71.6) Realized gains on available-for-sale securities (2.9) (0.6) (13.0) (1.2) Realized losses on available-for-sale securities 0.4 0.5 1.1 2.6 Impairment of intangible assets — — — 12.1 Gain on sale of assets — — (1.9) (4.1) Gain on sale of investment — — (0.2) — Non-service components of pension expense, net (see Note 11) (30.0) (5.9) (61.1) (5.3) Other income, net $ (44.6) $ (21.0) $ (145.2) $ (67.5) In fiscal 2019, the Company wrote down $12.1 million of internally developed software which was determined to have no future use due to redundant software identified as part of an acquisition. In addition, the Company recognized a gain of $4.1 million for the sale of assets in relation to the Service Alignment Initiative. |
Corporate Investments and Funds
Corporate Investments and Funds Held For Clients | 9 Months Ended |
Mar. 31, 2020 | |
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, 2020 and June 30, 2019 were as follows: March 31, 2020 Amortized Gross Gross Fair Market Value (A) Type of issue: Money market securities, cash and other cash equivalents $ 8,519.0 $ — $ — $ 8,519.0 Available-for-sale securities: Corporate bonds 10,802.4 226.4 (33.0) 10,995.8 Asset-backed securities 4,056.7 27.4 (42.1) 4,042.0 U.S. Treasury securities 3,585.9 129.4 — 3,715.3 U.S. government agency securities 1,491.4 61.0 — 1,552.4 Canadian government obligations and Canadian government agency obligations 1,007.0 16.2 (0.3) 1,022.9 Canadian provincial bonds 731.4 24.4 — 755.8 Municipal bonds 581.4 17.0 (0.5) 597.9 Other securities 1,291.9 50.7 (1.1) 1,341.5 Total available-for-sale securities 23,548.1 552.5 (77.0) 24,023.6 Total corporate investments and funds held for clients $ 32,067.1 $ 552.5 $ (77.0) $ 32,542.6 (A) Included within available-for-sale securities are corporate investments with fair values of $3.2 million and funds held for clients with fair values of $24,020.4 million . All available-for-sale securities were included in Level 2 of the fair value hierarchy. June 30, 2019 Amortized Gross Gross Fair Market Value (B) Type of issue: Money market securities, cash and other cash equivalents $ 6,796.2 $ — $ — $ 6,796.2 Available-for-sale securities: Corporate bonds 10,691.8 182.8 (6.7) 10,867.9 Asset-backed securities 4,658.3 37.8 (5.4) 4,690.7 U.S. Treasury securities 2,933.0 23.8 (8.0) 2,948.8 U.S. government agency securities 2,612.0 17.7 (5.8) 2,623.9 Canadian government obligations and Canadian government agency obligations 1,164.1 7.0 (6.0) 1,165.1 Canadian provincial bonds 800.2 14.5 (0.5) 814.2 Municipal bonds 596.1 16.4 (0.1) 612.4 Other securities 1,116.1 20.6 (0.6) 1,136.1 Total available-for-sale securities 24,571.6 320.6 (33.1) 24,859.1 Total corporate investments and funds held for clients $ 31,367.8 $ 320.6 $ (33.1) $ 31,655.3 (B) Included within available-for-sale securities are corporate investments with fair values of $271.9 million and funds held for clients with fair values of $24,587.2 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 2019. The Company did not transfer any assets between Levels during the nine months ended March 31, 2020 or fiscal 2019. In addition, the Company concurred with and did not adjust the prices obtained from the independent pricing service. The Company had no available-for-sale securities included in Level 1 or Level 3 at March 31, 2020. 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, 2020, are as follows: March 31, 2020 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Gross Fair Market Gross Fair Corporate bonds $ (32.9) $ 2,811.0 $ (0.1) $ 12.0 $ (33.0) $ 2,823.0 Asset-backed securities (41.2) 1,954.6 (0.9) 281.6 (42.1) 2,236.2 U.S. Treasury securities — 2.5 — — — 2.5 U.S. government agency securities — — — — — — Canadian government obligations and Canadian government agency obligations (0.3) 24.6 — — (0.3) 24.6 Canadian provincial bonds — 7.7 — — — 7.7 Municipal bonds (0.5) 44.1 — — (0.5) 44.1 Other securities (1.1) 89.1 — 3.2 (1.1) 92.3 $ (76.0) $ 4,933.6 $ (1.0) $ 296.8 $ (77.0) $ 5,230.4 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, 2019, are as follows: June 30, 2019 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Gross Fair Market Gross Fair Corporate bonds $ (0.6) $ 151.9 $ (6.1) $ 2,055.6 $ (6.7) $ 2,207.5 Asset-backed securities (0.2) 171.9 (5.2) 2,083.5 (5.4) 2,255.4 U.S. Treasury securities — 1.8 (8.0) 1,159.4 (8.0) 1,161.2 U.S. government agency securities — — (5.8) 1,671.4 (5.8) 1,671.4 Canadian government obligations and Canadian government agency obligations (6.0) 662.7 — 1.1 (6.0) 663.8 Canadian provincial bonds (0.3) 81.5 (0.2) 50.1 (0.5) 131.6 Municipal bonds — 1.5 (0.1) 23.3 (0.1) 24.8 Other securities (0.1) 36.4 (0.5) 148.1 (0.6) 184.5 $ (7.2) $ 1,107.7 $ (25.9) $ 7,192.5 $ (33.1) $ 8,300.2 At March 31, 2020, Corporate bonds include investment-grade debt securities with a wide variety of issuers, industries, and sectors, primarily carry credit ratings of A and above, and have maturities ranging from April 2020 through March 2030. At March 31, 2020, asset-backed securities include AAA-rated senior tranches of securities with predominantly prime collateral of fixed-rate auto loan, credit card, equipment lease, and rate reduction receivables with fair values of $2,045.2 million , $1,483.6 million , $391.5 million , and $121.0 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, 2020. At March 31, 2020, U.S. government agency securities primarily include debt directly issued by Federal Farm Credit Banks and Federal Home Loan Banks with fair values of $698.4 million and $648.5 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 April 2020 through December 2029 . At March 31, 2020, other securities and their fair value primarily include U.S. government agency commercial mortgage-backed securities of $859.0 million issued by Federal Home Loan Mortgage Corporation and Federal National Mortgage Association, AA-rated United Kingdom Gilt securities of $190.2 million, and AAA-rated and AA-rated supranational bonds of $91.7 million. Classification of corporate investments on the Consolidated Balance Sheets is as follows: March 31, June 30, 2020 2019 Corporate investments: Cash and cash equivalents $ 1,705.0 $ 1,949.2 Short-term marketable securities 3.2 10.5 Long-term marketable securities (a) — 261.4 Total corporate investments $ 1,708.2 $ 2,221.1 (a) - 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, 2020 2019 Funds held for clients: Restricted cash and cash equivalents held to satisfy client funds obligations $ 6,814.0 $ 4,847.0 Restricted short-term marketable securities held to satisfy client funds obligations 5,799.0 5,013.9 Restricted long-term marketable securities held to satisfy client funds obligations 18,221.4 19,573.3 Total funds held for clients $ 30,834.4 $ 29,434.2 Client funds obligations represent the Company's contractual obligations to remit funds to satisfy clients' payroll, tax, and other payee 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 $30,359.0 million and $29,144.5 million at March 31, 2020 and June 30, 2019, respectively. The Company has classified funds held for clients as a current asset since these funds are held solely for the purpose of satisfying the client funds obligations. Of the Company’s funds held for clients at March 31, 2020 and June 30, 2019, $27,689.8 million and $26,648.0 million, respectively, are held in the grantor trust. The liabilities held within the trust are intercompany liabilities to other Company subsidiaries and are eliminated in consolidation. 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 and cash equivalents related to client funds investments with original maturities of ninety days or less, within the beginning and ending balances of cash, cash equivalents, restricted cash, and restricted cash equivalents. These amounts have been reconciled to the Consolidated Balance Sheets on 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 / (decrease) in client funds obligations in the financing activities section of the Statements of Consolidated Cash Flows. Approximately 77% of the available-for-sale securities held a AAA-rating or AA-rating at March 31, 2020, as rated by Moody's, Standard & Poor's, DBRS for Canadian dollar-denominated securities, and Fitch for asset-backed and commercial mortgage-backed securities. All available-for-sale securities were rated as investment grade at March 31, 2020. Expected maturities of available-for-sale securities at March 31, 2020 are as follows: One year or less $ 5,802.2 One year to two years 4,387.0 Two years to three years 4,904.9 Three years to four years 3,369.3 After four years 5,560.2 Total available-for-sale securities $ 24,023.6 |
Leases
Leases | 9 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases During the first quarter of the fiscal year ending June 30, 2020 ("fiscal 2020"), the Company adopted ASC 842 using the optional transition method under which financial results reported in periods prior were not adjusted and continue to be reported in accordance with historic accounting under ASC 840 - Leases. The Company elected the following practical expedients permitted under the lease standard: • The Company did not reassess prior conclusions about lease identification, lease classification or initial direct costs, and did not use hindsight for leases existing at adoption date. • The Company did not record leases with an initial term of 12 months or less on the consolidated balance sheet but continues to expense them on a straight-line basis over the lease term. • The Company elected to combine lease and non-lease components for our facilities leases only. Non-lease components consist primarily of maintenance services. The Company records leases on the consolidated balance sheets as operating lease ROU assets, records the current portion of operating lease liabilities within accrued expenses and other current liabilities and, separately, records long-term operating lease liabilities. The Company has entered into operating lease agreements for facilities and equipment. The Company's leases have remaining lease terms of up to approximately eleven years. Operating lease ROU assets and operating lease liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term. The lease liabilities are measured by discounting future lease payments at the Company’s collateralized incremental borrowing rate for financing instruments of a similar term, unless the implicit rate is readily determinable. ROU assets also include adjustments related to prepaid or deferred lease payments and lease incentives. As of March 31, 2020, total operating lease ROU assets were $521.1 million, current and long-term operating lease liabilities were approximately $98.2 million and $361.2 million, respectively. The difference between total ROU assets and total lease liabilities are primarily attributable to pre-payments of our obligations and the recognition of various lease incentives. The components of operating lease expense were as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2020 Operating lease cost $ 34.8 $ 121.3 Short-term lease cost 1.6 5.6 Variable lease cost 2.9 4.9 Total operating lease cost $ 39.3 $ 131.8 Information related to our operating lease ROU assets and operating lease liabilities was as follows: Nine Months Ended March 31, 2020 Cash paid for operating lease liabilities $ 186.9 Operating lease ROU assets obtained in exchange for new operating lease liabilities $ 142.9 Weighted-average remaining lease term (in years) 6 Weighted-average discount rate 2.3 % As of March 31, 2020, maturities of operating lease liabilities are as follows: Three months ending June 30, 2020 $ 28.2 Twelve months ending June 30, 2021 103.9 Twelve months ending June 30, 2022 89.0 Twelve months ending June 30, 2023 76.5 Twelve months ending June 30, 2024 56.4 Thereafter 139.6 Total undiscounted lease obligations 493.6 Less: Imputed interest (34.2) Net lease obligations $ 459.4 |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, net | 9 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles Assets, net | Goodwill and Intangible Assets, net Changes in goodwill for the nine months ended March 31, 2020 are as follows: Employer PEO Total Balance at June 30, 2019 $ 2,318.2 $ 4.8 $ 2,323.0 Additions and other adjustments (2.5) — (2.5) Currency translation adjustments (21.2) — (21.2) Balance at March 31, 2020 $ 2,294.5 $ 4.8 $ 2,299.3 Components of intangible assets, net, are as follows: March 31, June 30, 2020 2019 Intangible assets: Software and software licenses $ 2,673.9 $ 2,519.3 Customer contracts and lists 901.9 860.7 Other intangibles 239.1 237.9 3,814.9 3,617.9 Less accumulated amortization: Software and software licenses (1,880.0) (1,762.3) Customer contracts and lists (606.6) (566.4) Other intangibles (221.6) (217.7) (2,708.2) (2,546.4) Intangible assets, net $ 1,106.7 $ 1,071.5 Other intangibles consist primarily of purchased rights, 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 6 years (6 years for software and software licenses, 5 years for customer contracts and lists, and 4 years for other intangibles). Amortization of intangible assets was $71.9 million and $57.1 million for the three months ended March 31, 2020 and 2019, respectively, and $211.0 million and $166.0 million for the nine months ended March 31, 2020 and 2019, respectively. Estimated future amortization expenses of the Company's existing intangible assets are as follows: Amount Three months ending June 30, 2020 $ 77.2 Twelve months ending June 30, 2021 $ 257.2 Twelve months ending June 30, 2022 $ 206.4 Twelve months ending June 30, 2023 $ 167.7 Twelve months ending June 30, 2024 $ 129.3 Twelve months ending June 30, 2025 $ 79.1 |
Short-term Financing
Short-term Financing | 9 Months Ended |
Mar. 31, 2020 | |
Short-Term Financing [Abstract] | |
Short-term Financing | Short-term Financing The Company has a $3.8 billion, 364-day credit agreement that matures in June 2020 with a one year term-out option. The Company also has a $2.75 billion five five 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 $10.3 billion in aggregate maturity value. The Company’s commercial paper program is rated A-1+ by Standard & Poor’s and Prime-1 (“P-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, 2020 and June 30, 2019, the Company had no commercial paper borrowing outstanding. Details of the borrowings under the commercial paper program are as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Average daily borrowings (in billions) $ 1.2 $ 1.1 $ 2.9 $ 2.9 Weighted average interest rates 1.5 % 2.4 % 1.9 % 2.2 % Weighted average maturity (approximately in days) 1 day 1 day 2 days 2 days The Company’s U.S., Canadian and United Kingdom 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, 2020, there were no outstanding obligations related to reverse repurchase agreements. At June 30, 2019, the Company had $262.0 million of outstanding obligations related to the reverse repurchase agreements, which were fully paid in early July 2019. Details of the reverse repurchase agreements are as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Average outstanding balances $ 123.2 $ 93.1 $ 295.9 $ 306.1 Weighted average interest rates 1.6 % 1.8 % 1.8 % 1.8 % |
Long-term Debt
Long-term Debt | 9 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 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, 2020 and June 30, 2019, are as follows: Debt instrument Effective Interest Rate March 31, 2020 June 30, 2019 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 8.7 10.9 2,008.7 2,010.9 Less: current portion (1,001.8) (2.5) Less: unamortized discount and debt issuance costs (4.1) (6.2) Total long-term debt $ 1,002.8 $ 2,002.2 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, 2020, the fair value of the Notes, based on Level 2 inputs, was $2,070.0 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 2019. In anticipation of the refinancing of our fixed-rate 2.25% notes due September 15, 2020, from December 3, 2019 through March 4, 2020, the Company entered into a series of treasury rate lock transactions, with an aggregate notional amount totaling $400.0 million, to hedge its exposure to changes in interest rates through the completion of the refinancing. The derivative contracts entered into during fiscal 2020 have been designated as cash-flow hedges and will be terminated upon completion of the refinancing. Changes in the derivative’s fair value are recorded each period in other comprehensive income with a corresponding current asset or liability and, upon settlement, the aggregate amount in accumulated other comprehensive income will be amortized into net income over the term of the future debt instrument. Refer to Note 15 for the impact to accumulated other comprehensive income. There are no cash flows associated with the derivative until settlement occurs with the counter-parties. The treasury rate lock derivatives are classified as Level 2 in the fair value hierarchy as their value is determined using observable inputs such as forward treasury rates. |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Pension Plans | Employee Benefit PlansStock-based Compensation Plans. Stock-based compensation consists of the following: 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. 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 program. During the second quarter of fiscal 2020, the Board of Directors authorized the repurchase of $5 billion of our common stock, replacing in its entirety the previous 2015 authorization to purchase up to 25 million shares of our common stock. The Company repurchased 2.5 million and 1.6 million shares in the three months ended March 31, 2020 and 2019, respectively. The Company repurchased 6.2 million and 5.4 million shares in the nine months ended March 31, 2020 and 2019, respectively, of which $536.6 million in the nine months ended March 31, 2020 were repurchased under the November 2019 authorization. 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 pre-tax stock-based compensation expense for the three and nine months ended March 31, 2020 and 2019, respectively: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Operating expenses $ 3.0 $ 4.1 $ 10.5 $ 12.9 Selling, general and administrative expenses 26.1 36.1 82.3 94.6 System development and programming costs 4.3 5.0 13.9 14.7 Total stock-based compensation expense $ 33.4 $ 45.2 $ 106.7 $ 122.2 The methods and assumptions used in the determination of the fair value of stock-based awards are consistent with those described in the Company's Form 10-K for fiscal 2019. See the Company's Annual Report on Form 10-K for fiscal 2019 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, payout percentages, and process for estimating the fair value of stock options granted. The components of net pension expense were as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Service cost – benefits earned during the period $ 14.9 $ 14.9 $ 44.8 $ 44.9 Interest cost on projected benefits 15.5 19.7 46.3 59.0 Expected return on plan assets (29.5) (32.9) (88.4) (98.9) Net amortization and deferral 1.9 — 4.8 0.1 Settlement charges, special termination benefits and plan curtailment (17.0) 7.8 (22.1) 35.9 Net pension expense $ (14.2) $ 9.5 $ (14.6) $ 41.0 The US pension plan, which is currently closed to new entrants, will be frozen effective July 1, 2020. Benefits under the plan will continue to accrue through June 30, 2020, and as of July 1, 2020 and onward, participants will retain their accrued benefits and will not accrue any future benefits due to service rendered or pay increases. As a result of the freeze, the Company recognized $17.0 million of prior service credits during the three months ended March 31, 2020 within Other Income, net, which were previously recognized within accumulated other comprehensive income (see Note 15). |
Income Taxes
Income Taxes | 9 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesThe effective tax rate for the three months ended March 31, 2020 and 2019 was 23.8% and 23.4%, respectively. The increase is primarily due to tax credits related to research and development activities in the three months ended March 31, 2019 and foreign withholding taxes on future distributions and an increase in reserves for uncertain tax positions in the three months ended March 31, 2020, partially offset by the benefits of a foreign tax law change and a reduction in the operating tax rate due to the mix between domestic and foreign earnings in the three months ended March 31, 2020.The effective tax rate for the nine months ended March 31, 2020 and 2019 was 22.5% and 23.4%, respectively. The decrease in the effective tax rate is primarily due to the release of a valuation allowance related to foreign tax credit carryforwards, a reduction in the operating tax rate due to the mix between domestic and foreign earnings and the benefit of a foreign tax law change partially offset by foreign withholding taxes on future distributions. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In June 2018, a potential class action complaint was filed against ADP in the Circuit Court of Cook County, Illinois. The complaint asserts that ADP violated the Illinois Biometric Privacy Act, was negligent and unjustly enriched itself in connection with its collection, use and storage of biometric data of employees of its clients who are residents of Illinois in connection with certain services provided by ADP to clients in Illinois. The complaint seeks statutory and other unspecified monetary damages, injunctive relief and attorney’s fees. In addition, similar potential class action complaints have been filed in Illinois state courts against ADP and/or certain of its clients with respect to the collection, use and storage of biometric data of the employees of these clients. All of these claims are still in their earliest stages and the Company is unable to estimate any reasonably possible loss, or range of loss, with respect to these matters. The Company intends to vigorously defend against these lawsuits. 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. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Attributable to Parent [Abstract] | |
Stockholders' Equity | Stockholders' Equity Changes in stockholders' equity by component are as follows: Three Months Ended March 31, 2020 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at December 31, 2019 $ 63.9 $ 1,253.7 $ 17,987.6 $ (13,709.6) $ (231.2) $ 5,364.4 Net earnings — — 820.9 — — 820.9 Other comprehensive income — — — — (3.2) (3.2) Stock-based compensation expense — 30.8 — — — 30.8 Issuances relating to stock compensation plans — 30.6 — 23.0 — 53.6 Treasury stock acquired (2.5 shares repurchased) — — — (383.8) — (383.8) Dividends declared ($0.91 per share) — — (392.0) — — (392.0) Balance at March 31, 2020 $ 63.9 $ 1,315.1 $ 18,416.5 $ (14,070.4) $ (234.4) $ 5,490.7 Three Months Ended March 31, 2019 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at December 31, 2018 $ 63.9 $ 1,076.1 $ 16,959.1 $ (12,720.2) $ (615.0) $ 4,763.9 Net earnings — — 753.7 — — 753.7 Other comprehensive income — — — — 203.1 203.1 Stock-based compensation expense — 35.8 — — — 35.8 Issuances relating to stock compensation plans — 28.3 — 33.6 — 61.9 Treasury stock acquired (1.6 shares repurchased) — — — (228.0) — (228.0) Dividends declared ($0.79 per share) — — (344.2) — — (344.2) Balance at March 31, 2019 $ 63.9 $ 1,140.2 $ 17,368.6 $ (12,914.6) $ (411.9) $ 5,246.2 Nine Months Ended March 31, 2020 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at June 30, 2019 $ 63.9 $ 1,183.2 $ 17,500.6 $ (13,090.5) $ (257.3) $ 5,399.9 Net earnings — — 2,054.9 — — 2,054.9 Other comprehensive income — — — — 22.9 22.9 Stock-based compensation expense — 98.1 — — — 98.1 Issuances relating to stock compensation plans — 33.8 — 107.9 — 141.7 Treasury stock acquired (6.2 shares repurchased) — — — (1,087.8) — (1,087.8) Dividends declared ($2.61 per share) — — (1,132.1) — — (1,132.1) Other — — (6.9) — — (6.9) Balance at March 31, 2020 $ 63.9 $ 1,315.1 $ 18,416.5 $ (14,070.4) $ (234.4) $ 5,490.7 Nine Months Ended March 31, 2019 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at June 30, 2018 $ 63.9 $ 1,014.8 $ 16,546.6 $ (12,209.6) $ (679.8) $ 4,735.9 Net earnings — — 1,817.4 — — 1,817.4 Other comprehensive income — — — — 267.9 267.9 Stock-based compensation expense — 105.4 — — — 105.4 Issuances relating to stock compensation plans — 20.0 — 117.1 — 137.1 Treasury stock acquired (5.4 shares repurchased) — — — (822.1) — (822.1) Dividends declared ($2.27 per share) — — (995.4) — — (995.4) Balance at March 31, 2019 $ 63.9 $ 1,140.2 $ 17,368.6 $ (12,914.6) $ (411.9) $ 5,246.2 |
Reclassifications out of Accumu
Reclassifications out of Accumulated Other Comprehensive Income (AOCI) | 9 Months Ended |
Mar. 31, 2020 | |
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, 2020 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Cash Flow Hedging Activities Pension Liability Accumulated Other Comprehensive Loss Balance at December 31, 2019 $ (283.8) $ 264.6 $ 0.5 $ (212.5) $ (231.2) Other comprehensive (loss)/income before reclassification adjustments (68.4) 139.3 (38.2) — 32.7 Tax effect — (32.2) 9.5 — (22.7) Reclassification adjustments to — (2.5) (A) — (15.0) (B) (17.5) Tax effect — 0.6 — 3.7 4.3 Balance at March 31, 2020 $ (352.2) $ 369.8 $ (28.2) $ (223.8) $ (234.4) Three Months Ended March 31, 2019 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive Loss Balance at December 31, 2018 $ (274.6) $ (181.5) $ (158.9) $ (615.0) Other comprehensive (loss)/income before reclassification adjustments (2.3) 259.0 — 256.7 Tax effect — (58.0) — (58.0) Reclassification adjustments to net earnings — (0.1) (A) 6.1 (B) 6.0 Tax effect — — (1.6) (1.6) Balance at March 31, 2019 $ (276.9) $ 19.4 $ (154.4) $ (411.9) Nine Months Ended March 31, 2020 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Cash Flow Hedging Activities Pension Liability Accumulated Other Comprehensive Loss Balance at June 30, 2019 $ (269.2) $ 224.6 $ — $ (212.7) $ (257.3) Other comprehensive (loss)/income before reclassification adjustments (83.0) 199.9 (37.4) — 79.5 Tax effect — (45.4) 9.2 — (36.2) Reclassification adjustments to net earnings — (11.9) (A) — (14.8) (B) (26.7) Tax effect — 2.6 — 3.7 6.3 Balance at March 31, 2020 $ (352.2) $ 369.8 $ (28.2) $ (223.8) $ (234.4) Nine Months Ended March 31, 2019 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive Loss Balance at June 30, 2018 $ (227.0) $ (274.0) $ (178.8) $ (679.8) Other comprehensive (loss)/income before reclassification adjustments (49.9) 377.0 — 327.1 Tax effect — (84.8) — (84.8) Reclassification adjustments to net earnings — 1.4 (A) 32.5 (B) 33.9 Tax effect — (0.2) (8.1) (8.3) Balance at March 31, 2019 $ (276.9) $ 19.4 $ (154.4) $ (411.9) (A) Reclassification adjustments out of AOCI are included within Other income, net, on the Statements of Consolidated Earnings. |
Interim Financial Data by Segme
Interim Financial Data by Segment | 9 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Interim Financial Data by Segment | Interim Financial Data by SegmentBased 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 certain corporate overhead charges and expenses that have not been allocated to the reportable segments, including corporate functions, costs related to our transformation office, non-recurring gains and losses, the elimination of intercompany transactions, and interest expense. 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. Beginning in the first quarter of fiscal 2020, the Company made changes to the allocation methodology for certain corporate allocations, in both the current period and the prior period in the table below, which did not materially affect reportable segment results. In addition, the segment results in the table below reflect the impact of the revision to PEO revenues for comparability. Refer to Note 1 to our Consolidated Financial Statements for more information on this revision. Segment Results: Revenues Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Employer Services $ 2,811.7 $ 2,719.1 $ 7,790.6 $ 7,507.7 PEO Services 1,238.3 1,115.5 3,429.8 3,135.1 Other (2.2) (6.4) (7.4) (11.9) $ 4,047.8 $ 3,828.2 $ 11,213.0 $ 10,630.9 Earnings before Income Taxes Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Employer Services $ 1,025.0 $ 963.1 $ 2,473.4 $ 2,335.9 PEO Services 172.6 154.7 488.1 455.7 Other (120.9) (133.3) (310.2) (419.3) $ 1,076.7 $ 984.5 $ 2,651.3 $ 2,372.3 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In April 2020, the Company made a decision to sell certain available-for-sale securities in the funds held for clients as the Company anticipates client fund obligations will decline due to reduction in employment levels from a slowdown in the economy as a result of the coronavirus ("COVID-19") pandemic. To maintain the size of the funds held for clients in line with client fund obligations, the Company will reduce its holdings of available-for-sale securities in the funds held for clients. As of May 1, 2020, the Company sold approximately $1.3 billion of its available-for-sale securities, resulting in a net realized gain of $0.7 million. The Company continues to evaluate the impact of COVID-19 on its operations and financial condition through the filing of this Form 10-Q and has determined there are no required updates to our disclosures. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Revision to Previously Reported Financial Information | the accompanying Statements of Consolidated Earnings for the three and nine months ended March 31, 2019 have been revised to correct the amounts previously reported on a gross basis to a net basis by reducing PEO revenues and operating expenses for associated costs of an equal amount, as follows: Three Months Ended March 31, 2019 As reported Revision As revised PEO revenues $ 1,133.1 (19.2) $ 1,113.9 TOTAL REVENUES 3,847.4 (19.2) 3,828.2 Operating expenses 1,874.5 (19.2) 1,855.3 Total Expenses 2,883.9 (19.2) 2,864.7 EARNINGS BEFORE INCOME TAXES 984.5 — 984.5 Provision for income taxes 230.8 — 230.8 NET EARNINGS $ 753.7 — $ 753.7 Nine Months Ended March 31, 2019 As reported Revision As revised PEO revenues $ 3,176.8 (45.6) $ 3,131.2 TOTAL REVENUES 10,676.5 (45.6) 10,630.9 Operating expenses 5,370.4 (45.6) 5,324.8 Total Expenses 8,371.7 (45.6) 8,326.1 EARNINGS BEFORE INCOME TAXES 2,372.3 — 2,372.3 Provision for income taxes 554.9 — 554.9 NET EARNINGS $ 1,817.4 — $ 1,817.4 |
New Accounting Pronouncements (
New Accounting Pronouncements (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Recently Issued Accounting Pronouncements The following table summarizes recent ASU's issued by the Financial Accounting Standards Board (“FASB”) which have been assessed: Standard Description Effective Date Effect on Financial Statements or Other Significant Matters ASU 2020-04 Reference Rate Reform This update provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate (LIBOR) reform on financial reporting. March 12, 2020 The Company is assessing the effects of the Reference Rate Reform. The Company has not yet determined the impact of this ASU on its consolidated results of operations, financial condition, or cash flows. ASU 2018-14 Compensation-Retirement Benefits-Defined Benefit Plans This update modifies the disclosure requirements for employers that sponsor defined benefit pension or other post-retirement plans by removing and adding certain disclosures for these plans. The eliminated disclosures include (a) the amounts in accumulated other comprehensive income expected to be recognized in net periodic benefit costs over the next fiscal year, and (b) the effects of a one percentage point change in assumed health care cost trend rates on the net periodic benefit costs and the benefit obligation for post-retirement health care benefits. Additional disclosures include descriptions of significant gains and losses affecting the benefit obligation for the period. The amendments in ASU 2018-14 would need to be applied on a retrospective basis. July 1, 2021 The adoption of this guidance will modify disclosures but will not have an impact on the Company's consolidated results of operations, financial condition, or cash flows. ASU 2018-13 Fair Value Measurement This update modifies the disclosure requirements on fair value measurements. Certain disclosures in ASU 2018-13 would need to be applied on a retrospective basis and others on a prospective basis. July 1, 2020 The adoption of this guidance will modify disclosures but will not have an impact on the Company's consolidated results of operations, financial condition, or cash flows. ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This update introduces the current expected credit loss (CECL) model, which will require an entity to measure credit losses for certain financial instruments and financial assets, including trade receivables. Under this update, on initial recognition and at each reporting period, an entity will be required to recognize an allowance that reflects the entity’s current estimate of credit losses expected to be incurred over the life of the financial instrument. In addition, this update modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. In November 2019, the FASB issued Accounting Standard Update 2019-11 Codification Improvements to Topic 326, Financial-Credit Losses which provides clarification and eliminates inconsistencies to amendments included in Update 2016-13. July 1, 2020 The Company is evaluating the impact of this ASU on its consolidated results of operations, financial condition, or cash flows. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following tables provide details of revenue by our strategic pillars with disaggregation for PEO zero-margin benefits pass-throughs and client fund interest, and include a reconciliation to the Company’s reportable segments: Three Months Ended Nine Months Ended March 31, March 31, Types of Revenues 2020 2019 2020 2019 HCM $ 1,858.3 $ 1,771.4 $ 5,074.8 $ 4,886.1 HRO, excluding PEO zero-margin benefits pass-throughs 742.4 678.7 1,983.6 1,855.4 PEO zero-margin benefits pass-throughs 747.9 665.3 2,169.4 1,965.5 Global 540.3 545.4 1,554.8 1,508.9 Interest on funds held for clients 158.9 167.4 430.4 415.0 Total Revenues $ 4,047.8 $ 3,828.2 $ 11,213.0 $ 10,630.9 Reconciliation of disaggregated revenue to our reportable segments for the three months ended March 31, 2020: Types of Revenues Employer Services PEO Other Total HCM $ 1,859.8 $ — $ (1.5) $ 1,858.3 HRO, excluding PEO zero-margin benefits pass-throughs 254.1 489.0 (0.7) 742.4 PEO zero-margin benefits pass-throughs — 747.9 — 747.9 Global 540.3 — — 540.3 Interest on funds held for clients 157.5 1.4 — 158.9 Total Segment Revenues $ 2,811.7 $ 1,238.3 $ (2.2) $ 4,047.8 Reconciliation of disaggregated revenue to our reportable segments for the three months ended March 31, 2019: Types of Revenues Employer Services PEO Other Total HCM $ 1,774.7 $ — $ (3.3) $ 1,771.4 HRO, excluding PEO zero-margin benefits pass-throughs 233.2 448.6 (3.1) 678.7 PEO zero-margin benefits pass-throughs — 665.3 — 665.3 Global 545.4 — — 545.4 Interest on funds held for clients 165.8 1.6 — 167.4 Total Segment Revenues $ 2,719.1 $ 1,115.5 $ (6.4) $ 3,828.2 Reconciliation of disaggregated revenue to our reportable segments for the nine months ended March 31, 2020: Types of Revenues Employer Services PEO Other Total HCM $ 5,079.6 $ — $ (4.8) $ 5,074.8 HRO, excluding PEO zero-margin benefits pass-throughs 729.7 1,256.5 (2.6) 1,983.6 PEO zero-margin benefits pass-throughs — 2,169.4 — 2,169.4 Global 1,554.8 — — 1,554.8 Interest on funds held for clients 426.5 3.9 — 430.4 Total Segment Revenues $ 7,790.6 $ 3,429.8 $ (7.4) $ 11,213.0 Reconciliation of disaggregated revenue to our reportable segments for the nine months ended March 31, 2019: Types of Revenues Employer Services PEO Other Total HCM $ 4,891.1 $ — $ (5.0) $ 4,886.1 HRO, excluding PEO zero-margin benefits pass-throughs 696.6 1,165.7 (6.9) 1,855.4 PEO zero-margin benefits pass-throughs — 1,965.5 — 1,965.5 Global 1,508.9 — — 1,508.9 Interest on funds held for clients 411.1 3.9 — 415.0 Total Segment Revenues $ 7,507.7 $ 3,135.1 $ (11.9) $ 10,630.9 |
Contract with Customer, Liability | Changes in deferred revenue related to set up fees for the nine months ended March 31, 2020 were as follows: Contract Liability Contract liability, July 1, 2019 $ 563.4 Recognition of revenue included in beginning of year contract liability (129.7) Contract liability, net of revenue recognized on contracts during the period 107.6 Currency adjustments (6.7) Contract liability, March 31, 2020 $ 534.6 |
Earnings per Share (EPS) (Table
Earnings per Share (EPS) (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Basic Effect of Employee Stock Option Shares Effect of Diluted Three Months Ended March 31, 2020 Net earnings $ 820.9 $ 820.9 Weighted average shares (in millions) 430.0 0.9 0.9 431.8 EPS $ 1.91 $ 1.90 Three Months Ended March 31, 2019 Net earnings $ 753.7 $ 753.7 Weighted average shares (in millions) 434.1 1.2 1.3 436.6 EPS $ 1.74 $ 1.73 Nine Months Ended March 31, 2020 Net earnings $ 2,054.9 $ 2,054.9 Weighted average shares (in millions) 431.4 1.1 1.0 433.5 EPS $ 4.76 $ 4.74 Nine Months Ended March 31, 2019 Net earnings $ 1,817.4 $ 1,817.4 Weighted average shares (in millions) 435.5 1.3 1.3 438.1 EPS $ 4.17 $ 4.15 |
Other Income, Net (Tables)
Other Income, Net (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income, net | Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Interest income on corporate funds $ (12.1) $ (15.0) $ (70.1) $ (71.6) Realized gains on available-for-sale securities (2.9) (0.6) (13.0) (1.2) Realized losses on available-for-sale securities 0.4 0.5 1.1 2.6 Impairment of intangible assets — — — 12.1 Gain on sale of assets — — (1.9) (4.1) Gain on sale of investment — — (0.2) — Non-service components of pension expense, net (see Note 11) (30.0) (5.9) (61.1) (5.3) Other income, net $ (44.6) $ (21.0) $ (145.2) $ (67.5) |
Corporate Investments and Fun_2
Corporate Investments and Funds Held For Clients (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Corporate Investments And Funds Held For Clients [Abstract] | |
Available-for-sale Securities | Corporate investments and funds held for clients at March 31, 2020 and June 30, 2019 were as follows: March 31, 2020 Amortized Gross Gross Fair Market Value (A) Type of issue: Money market securities, cash and other cash equivalents $ 8,519.0 $ — $ — $ 8,519.0 Available-for-sale securities: Corporate bonds 10,802.4 226.4 (33.0) 10,995.8 Asset-backed securities 4,056.7 27.4 (42.1) 4,042.0 U.S. Treasury securities 3,585.9 129.4 — 3,715.3 U.S. government agency securities 1,491.4 61.0 — 1,552.4 Canadian government obligations and Canadian government agency obligations 1,007.0 16.2 (0.3) 1,022.9 Canadian provincial bonds 731.4 24.4 — 755.8 Municipal bonds 581.4 17.0 (0.5) 597.9 Other securities 1,291.9 50.7 (1.1) 1,341.5 Total available-for-sale securities 23,548.1 552.5 (77.0) 24,023.6 Total corporate investments and funds held for clients $ 32,067.1 $ 552.5 $ (77.0) $ 32,542.6 (A) Included within available-for-sale securities are corporate investments with fair values of $3.2 million and funds held for clients with fair values of $24,020.4 million . All available-for-sale securities were included in Level 2 of the fair value hierarchy. June 30, 2019 Amortized Gross Gross Fair Market Value (B) Type of issue: Money market securities, cash and other cash equivalents $ 6,796.2 $ — $ — $ 6,796.2 Available-for-sale securities: Corporate bonds 10,691.8 182.8 (6.7) 10,867.9 Asset-backed securities 4,658.3 37.8 (5.4) 4,690.7 U.S. Treasury securities 2,933.0 23.8 (8.0) 2,948.8 U.S. government agency securities 2,612.0 17.7 (5.8) 2,623.9 Canadian government obligations and Canadian government agency obligations 1,164.1 7.0 (6.0) 1,165.1 Canadian provincial bonds 800.2 14.5 (0.5) 814.2 Municipal bonds 596.1 16.4 (0.1) 612.4 Other securities 1,116.1 20.6 (0.6) 1,136.1 Total available-for-sale securities 24,571.6 320.6 (33.1) 24,859.1 Total corporate investments and funds held for clients $ 31,367.8 $ 320.6 $ (33.1) $ 31,655.3 |
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, 2020, are as follows: March 31, 2020 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Gross Fair Market Gross Fair Corporate bonds $ (32.9) $ 2,811.0 $ (0.1) $ 12.0 $ (33.0) $ 2,823.0 Asset-backed securities (41.2) 1,954.6 (0.9) 281.6 (42.1) 2,236.2 U.S. Treasury securities — 2.5 — — — 2.5 U.S. government agency securities — — — — — — Canadian government obligations and Canadian government agency obligations (0.3) 24.6 — — (0.3) 24.6 Canadian provincial bonds — 7.7 — — — 7.7 Municipal bonds (0.5) 44.1 — — (0.5) 44.1 Other securities (1.1) 89.1 — 3.2 (1.1) 92.3 $ (76.0) $ 4,933.6 $ (1.0) $ 296.8 $ (77.0) $ 5,230.4 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, 2019, are as follows: June 30, 2019 Securities in Unrealized Loss Position Less Than 12 Months Securities in Unrealized Loss Position Greater Than 12 Months Total Gross Fair Market Gross Fair Market Gross Fair Corporate bonds $ (0.6) $ 151.9 $ (6.1) $ 2,055.6 $ (6.7) $ 2,207.5 Asset-backed securities (0.2) 171.9 (5.2) 2,083.5 (5.4) 2,255.4 U.S. Treasury securities — 1.8 (8.0) 1,159.4 (8.0) 1,161.2 U.S. government agency securities — — (5.8) 1,671.4 (5.8) 1,671.4 Canadian government obligations and Canadian government agency obligations (6.0) 662.7 — 1.1 (6.0) 663.8 Canadian provincial bonds (0.3) 81.5 (0.2) 50.1 (0.5) 131.6 Municipal bonds — 1.5 (0.1) 23.3 (0.1) 24.8 Other securities (0.1) 36.4 (0.5) 148.1 (0.6) 184.5 $ (7.2) $ 1,107.7 $ (25.9) $ 7,192.5 $ (33.1) $ 8,300.2 |
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, 2020 2019 Corporate investments: Cash and cash equivalents $ 1,705.0 $ 1,949.2 Short-term marketable securities 3.2 10.5 Long-term marketable securities (a) — 261.4 Total corporate investments $ 1,708.2 $ 2,221.1 (a) - Long-term marketable securities are included within Other assets on the Consolidated Balance Sheets. |
Schedule Of Investment Of Funds Held For Clients | Funds held for clients have been invested in the following categories: March 31, June 30, 2020 2019 Funds held for clients: Restricted cash and cash equivalents held to satisfy client funds obligations $ 6,814.0 $ 4,847.0 Restricted short-term marketable securities held to satisfy client funds obligations 5,799.0 5,013.9 Restricted long-term marketable securities held to satisfy client funds obligations 18,221.4 19,573.3 Total funds held for clients $ 30,834.4 $ 29,434.2 |
Expected Maturities Of Available-For-Sale Securities | Expected maturities of available-for-sale securities at March 31, 2020 are as follows: One year or less $ 5,802.2 One year to two years 4,387.0 Two years to three years 4,904.9 Three years to four years 3,369.3 After four years 5,560.2 Total available-for-sale securities $ 24,023.6 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Lease Cost | The components of operating lease expense were as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2020 Operating lease cost $ 34.8 $ 121.3 Short-term lease cost 1.6 5.6 Variable lease cost 2.9 4.9 Total operating lease cost $ 39.3 $ 131.8 |
Schedule of Operating lease ROU assets and liabilities | Information related to our operating lease ROU assets and operating lease liabilities was as follows: Nine Months Ended March 31, 2020 Cash paid for operating lease liabilities $ 186.9 Operating lease ROU assets obtained in exchange for new operating lease liabilities $ 142.9 Weighted-average remaining lease term (in years) 6 Weighted-average discount rate 2.3 % |
Schedule of Operating Lease Maturities | As of March 31, 2020, maturities of operating lease liabilities are as follows: Three months ending June 30, 2020 $ 28.2 Twelve months ending June 30, 2021 103.9 Twelve months ending June 30, 2022 89.0 Twelve months ending June 30, 2023 76.5 Twelve months ending June 30, 2024 56.4 Thereafter 139.6 Total undiscounted lease obligations 493.6 Less: Imputed interest (34.2) Net lease obligations $ 459.4 |
Goodwill and Intangibles Assets
Goodwill and Intangibles Assets, net (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes In Goodwill | Changes in goodwill for the nine months ended March 31, 2020 are as follows: Employer PEO Total Balance at June 30, 2019 $ 2,318.2 $ 4.8 $ 2,323.0 Additions and other adjustments (2.5) — (2.5) Currency translation adjustments (21.2) — (21.2) Balance at March 31, 2020 $ 2,294.5 $ 4.8 $ 2,299.3 |
Components Of Finite-Lived Intangible Assets | Components of intangible assets, net, are as follows: March 31, June 30, 2020 2019 Intangible assets: Software and software licenses $ 2,673.9 $ 2,519.3 Customer contracts and lists 901.9 860.7 Other intangibles 239.1 237.9 3,814.9 3,617.9 Less accumulated amortization: Software and software licenses (1,880.0) (1,762.3) Customer contracts and lists (606.6) (566.4) Other intangibles (221.6) (217.7) (2,708.2) (2,546.4) Intangible assets, net $ 1,106.7 $ 1,071.5 |
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, 2020 $ 77.2 Twelve months ending June 30, 2021 $ 257.2 Twelve months ending June 30, 2022 $ 206.4 Twelve months ending June 30, 2023 $ 167.7 Twelve months ending June 30, 2024 $ 129.3 Twelve months ending June 30, 2025 $ 79.1 |
Short-term Financing (Tables)
Short-term Financing (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Short-Term Financing [Abstract] | |
Commercial Paper Program | Details of the borrowings under the commercial paper program are as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Average daily borrowings (in billions) $ 1.2 $ 1.1 $ 2.9 $ 2.9 Weighted average interest rates 1.5 % 2.4 % 1.9 % 2.2 % Weighted average maturity (approximately in days) 1 day 1 day 2 days 2 days |
Reverse Repurchase Agreement | Details of the reverse repurchase agreements are as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Average outstanding balances $ 123.2 $ 93.1 $ 295.9 $ 306.1 Weighted average interest rates 1.6 % 1.8 % 1.8 % 1.8 % |
Long-term Debt (Tables)
Long-term Debt (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
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, 2020 and June 30, 2019, are as follows: Debt instrument Effective Interest Rate March 31, 2020 June 30, 2019 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 8.7 10.9 2,008.7 2,010.9 Less: current portion (1,001.8) (2.5) Less: unamortized discount and debt issuance costs (4.1) (6.2) Total long-term debt $ 1,002.8 $ 2,002.2 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Components Of Stock-Based Compensation Expense | The following table represents pre-tax stock-based compensation expense for the three and nine months ended March 31, 2020 and 2019, respectively: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Operating expenses $ 3.0 $ 4.1 $ 10.5 $ 12.9 Selling, general and administrative expenses 26.1 36.1 82.3 94.6 System development and programming costs 4.3 5.0 13.9 14.7 Total stock-based compensation expense $ 33.4 $ 45.2 $ 106.7 $ 122.2 |
Schedule of Net Benefit Costs | The components of net pension expense were as follows: Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Service cost – benefits earned during the period $ 14.9 $ 14.9 $ 44.8 $ 44.9 Interest cost on projected benefits 15.5 19.7 46.3 59.0 Expected return on plan assets (29.5) (32.9) (88.4) (98.9) Net amortization and deferral 1.9 — 4.8 0.1 Settlement charges, special termination benefits and plan curtailment (17.0) 7.8 (22.1) 35.9 Net pension expense $ (14.2) $ 9.5 $ (14.6) $ 41.0 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Attributable to Parent [Abstract] | |
Schedule of Components of Stockholders' Equity | Changes in stockholders' equity by component are as follows: Three Months Ended March 31, 2020 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at December 31, 2019 $ 63.9 $ 1,253.7 $ 17,987.6 $ (13,709.6) $ (231.2) $ 5,364.4 Net earnings — — 820.9 — — 820.9 Other comprehensive income — — — — (3.2) (3.2) Stock-based compensation expense — 30.8 — — — 30.8 Issuances relating to stock compensation plans — 30.6 — 23.0 — 53.6 Treasury stock acquired (2.5 shares repurchased) — — — (383.8) — (383.8) Dividends declared ($0.91 per share) — — (392.0) — — (392.0) Balance at March 31, 2020 $ 63.9 $ 1,315.1 $ 18,416.5 $ (14,070.4) $ (234.4) $ 5,490.7 Three Months Ended March 31, 2019 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at December 31, 2018 $ 63.9 $ 1,076.1 $ 16,959.1 $ (12,720.2) $ (615.0) $ 4,763.9 Net earnings — — 753.7 — — 753.7 Other comprehensive income — — — — 203.1 203.1 Stock-based compensation expense — 35.8 — — — 35.8 Issuances relating to stock compensation plans — 28.3 — 33.6 — 61.9 Treasury stock acquired (1.6 shares repurchased) — — — (228.0) — (228.0) Dividends declared ($0.79 per share) — — (344.2) — — (344.2) Balance at March 31, 2019 $ 63.9 $ 1,140.2 $ 17,368.6 $ (12,914.6) $ (411.9) $ 5,246.2 Nine Months Ended March 31, 2020 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at June 30, 2019 $ 63.9 $ 1,183.2 $ 17,500.6 $ (13,090.5) $ (257.3) $ 5,399.9 Net earnings — — 2,054.9 — — 2,054.9 Other comprehensive income — — — — 22.9 22.9 Stock-based compensation expense — 98.1 — — — 98.1 Issuances relating to stock compensation plans — 33.8 — 107.9 — 141.7 Treasury stock acquired (6.2 shares repurchased) — — — (1,087.8) — (1,087.8) Dividends declared ($2.61 per share) — — (1,132.1) — — (1,132.1) Other — — (6.9) — — (6.9) Balance at March 31, 2020 $ 63.9 $ 1,315.1 $ 18,416.5 $ (14,070.4) $ (234.4) $ 5,490.7 Nine Months Ended March 31, 2019 Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock AOCI Total Balance at June 30, 2018 $ 63.9 $ 1,014.8 $ 16,546.6 $ (12,209.6) $ (679.8) $ 4,735.9 Net earnings — — 1,817.4 — — 1,817.4 Other comprehensive income — — — — 267.9 267.9 Stock-based compensation expense — 105.4 — — — 105.4 Issuances relating to stock compensation plans — 20.0 — 117.1 — 137.1 Treasury stock acquired (5.4 shares repurchased) — — — (822.1) — (822.1) Dividends declared ($2.27 per share) — — (995.4) — — (995.4) Balance at March 31, 2019 $ 63.9 $ 1,140.2 $ 17,368.6 $ (12,914.6) $ (411.9) $ 5,246.2 |
Reclassifications out of Accu_2
Reclassifications out of Accumulated Other Comprehensive Income (AOCI) (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
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, 2020 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Cash Flow Hedging Activities Pension Liability Accumulated Other Comprehensive Loss Balance at December 31, 2019 $ (283.8) $ 264.6 $ 0.5 $ (212.5) $ (231.2) Other comprehensive (loss)/income before reclassification adjustments (68.4) 139.3 (38.2) — 32.7 Tax effect — (32.2) 9.5 — (22.7) Reclassification adjustments to — (2.5) (A) — (15.0) (B) (17.5) Tax effect — 0.6 — 3.7 4.3 Balance at March 31, 2020 $ (352.2) $ 369.8 $ (28.2) $ (223.8) $ (234.4) Three Months Ended March 31, 2019 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive Loss Balance at December 31, 2018 $ (274.6) $ (181.5) $ (158.9) $ (615.0) Other comprehensive (loss)/income before reclassification adjustments (2.3) 259.0 — 256.7 Tax effect — (58.0) — (58.0) Reclassification adjustments to net earnings — (0.1) (A) 6.1 (B) 6.0 Tax effect — — (1.6) (1.6) Balance at March 31, 2019 $ (276.9) $ 19.4 $ (154.4) $ (411.9) Nine Months Ended March 31, 2020 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Cash Flow Hedging Activities Pension Liability Accumulated Other Comprehensive Loss Balance at June 30, 2019 $ (269.2) $ 224.6 $ — $ (212.7) $ (257.3) Other comprehensive (loss)/income before reclassification adjustments (83.0) 199.9 (37.4) — 79.5 Tax effect — (45.4) 9.2 — (36.2) Reclassification adjustments to net earnings — (11.9) (A) — (14.8) (B) (26.7) Tax effect — 2.6 — 3.7 6.3 Balance at March 31, 2020 $ (352.2) $ 369.8 $ (28.2) $ (223.8) $ (234.4) Nine Months Ended March 31, 2019 Currency Translation Adjustment Net Gains/Losses on Available-for-sale Securities Pension Liability Accumulated Other Comprehensive Loss Balance at June 30, 2018 $ (227.0) $ (274.0) $ (178.8) $ (679.8) Other comprehensive (loss)/income before reclassification adjustments (49.9) 377.0 — 327.1 Tax effect — (84.8) — (84.8) Reclassification adjustments to net earnings — 1.4 (A) 32.5 (B) 33.9 Tax effect — (0.2) (8.1) (8.3) Balance at March 31, 2019 $ (276.9) $ 19.4 $ (154.4) $ (411.9) (A) Reclassification adjustments out of AOCI are included within Other income, net, on the Statements of Consolidated Earnings. |
Interim Financial Data by Seg_2
Interim Financial Data by Segment (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Segment Results: Revenues Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Employer Services $ 2,811.7 $ 2,719.1 $ 7,790.6 $ 7,507.7 PEO Services 1,238.3 1,115.5 3,429.8 3,135.1 Other (2.2) (6.4) (7.4) (11.9) $ 4,047.8 $ 3,828.2 $ 11,213.0 $ 10,630.9 Earnings before Income Taxes Three Months Ended Nine Months Ended March 31, March 31, 2020 2019 2020 2019 Employer Services $ 1,025.0 $ 963.1 $ 2,473.4 $ 2,335.9 PEO Services 172.6 154.7 488.1 455.7 Other (120.9) (133.3) (310.2) (419.3) $ 1,076.7 $ 984.5 $ 2,651.3 $ 2,372.3 |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
PEO revenues | [1] | $ 1,236.8 | $ 1,113.9 | $ 3,425.9 | $ 3,131.2 |
TOTAL REVENUES | 4,047.8 | 3,828.2 | 11,213 | 10,630.9 | |
Operating expenses | 1,974.1 | 1,855.3 | 5,597.8 | 5,324.8 | |
Total Expenses | 3,015.7 | 2,864.7 | 8,706.9 | 8,326.1 | |
EARNINGS BEFORE INCOME TAXES | 1,076.7 | 984.5 | 2,651.3 | 2,372.3 | |
Provision for income taxes | 255.8 | 230.8 | 596.4 | 554.9 | |
NET EARNINGS | $ 820.9 | 753.7 | $ 2,054.9 | 1,817.4 | |
Revision | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
PEO revenues | [1] | (19.2) | (45.6) | ||
TOTAL REVENUES | (19.2) | (45.6) | |||
Operating expenses | (19.2) | (45.6) | |||
Total Expenses | (19.2) | (45.6) | |||
EARNINGS BEFORE INCOME TAXES | 0 | 0 | |||
Provision for income taxes | 0 | 0 | |||
NET EARNINGS | 0 | 0 | |||
As reported | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
PEO revenues | [1] | 1,133.1 | 3,176.8 | ||
TOTAL REVENUES | 3,847.4 | 10,676.5 | |||
Operating expenses | 1,874.5 | 5,370.4 | |||
Total Expenses | 2,883.9 | 8,371.7 | |||
EARNINGS BEFORE INCOME TAXES | 984.5 | 2,372.3 | |||
Provision for income taxes | 230.8 | 554.9 | |||
NET EARNINGS | $ 753.7 | $ 1,817.4 | |||
[1] | Professional Employer Organization (“PEO”) revenues are net of direct pass-through costs, primarily consisting of payroll wages and payroll taxes of $12,643.6 million and $10,798.3 million for the three months ended March 31, 2020 and 2019, respectively, and $35,525.8 million and $32,178.8 million for the nine months ended March 31, 2020 and 2019, respectively. |
New Accounting Pronouncements_2
New Accounting Pronouncements (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Jul. 01, 2019 | Jun. 30, 2019 |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||
Operating lease right-of-use asset | $ 521.1 | $ 573.3 | $ 0 |
Operating lease liabilities | $ 361.2 | $ 522.6 | $ 0 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 4,047.8 | $ 3,828.2 | $ 11,213 | $ 10,630.9 |
Employer Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 2,811.7 | 2,719.1 | 7,790.6 | 7,507.7 |
PEO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,238.3 | 1,115.5 | 3,429.8 | 3,135.1 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | (2.2) | (6.4) | (7.4) | (11.9) |
HCM | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,858.3 | 1,771.4 | 5,074.8 | 4,886.1 |
HCM | Employer Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,859.8 | 1,774.7 | 5,079.6 | 4,891.1 |
HCM | PEO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
HCM | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | (1.5) | (3.3) | (4.8) | (5) |
HRO, excluding PEO zero-margin benefits pass-throughs | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 742.4 | 678.7 | 1,983.6 | 1,855.4 |
HRO, excluding PEO zero-margin benefits pass-throughs | Employer Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 254.1 | 233.2 | 729.7 | 696.6 |
HRO, excluding PEO zero-margin benefits pass-throughs | PEO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 489 | 448.6 | 1,256.5 | 1,165.7 |
HRO, excluding PEO zero-margin benefits pass-throughs | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | (0.7) | (3.1) | (2.6) | (6.9) |
PEO zero-margin benefits pass-throughs | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 747.9 | 665.3 | 2,169.4 | 1,965.5 |
PEO zero-margin benefits pass-throughs | Employer Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
PEO zero-margin benefits pass-throughs | PEO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 747.9 | 665.3 | 2,169.4 | 1,965.5 |
PEO zero-margin benefits pass-throughs | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Global | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 540.3 | 545.4 | 1,554.8 | 1,508.9 |
Global | Employer Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 540.3 | 545.4 | 1,554.8 | 1,508.9 |
Global | PEO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Global | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Interest on funds held for clients | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 158.9 | 167.4 | 430.4 | 415 |
Interest on funds held for clients | Employer Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 157.5 | 165.8 | 426.5 | 411.1 |
Interest on funds held for clients | PEO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1.4 | 1.6 | 3.9 | 3.9 |
Interest on funds held for clients | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Revenue - Contract Liability (D
Revenue - Contract Liability (Details) $ in Millions | 9 Months Ended |
Mar. 31, 2020USD ($) | |
Change In Contract With Customer, Liability [Roll Forward] | |
Contract liability, July 1, 2019 | $ 563.4 |
Recognition of revenue included in beginning of year contract liability | (129.7) |
Contract liability, net of revenue recognized on contracts during the period | 107.6 |
Currency adjustments | (6.7) |
Contract liability, March 31, 2020 | $ 534.6 |
Earnings per Share (EPS) (Detai
Earnings per Share (EPS) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||||
Net earnings | $ 820.9 | $ 753.7 | $ 2,054.9 | $ 1,817.4 |
Basic weighted average shares outstanding (shares) | 430 | 434.1 | 431.4 | 435.5 |
Effect of employee stock option shares (shares) | 0.9 | 1.2 | 1.1 | 1.3 |
Effect of employee restricted stock shares (shares) | 0.9 | 1.3 | 1 | 1.3 |
Diluted weighted average shares outstanding (shares) | 431.8 | 436.6 | 433.5 | 438.1 |
Basic EPS from continuing operations (in US$ per share) | $ 1.91 | $ 1.74 | $ 4.76 | $ 4.17 |
Diluted EPS from continuing operations (in US$ per share) | $ 1.90 | $ 1.73 | $ 4.74 | $ 4.15 |
Options excluded from the calculation of diluted earnings per share (shares) | 1.3 | 0.8 | 1.1 | 0.6 |
Other Income, Net (Details)
Other Income, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Other Income and Expenses [Abstract] | ||||
Interest income on corporate funds | $ (12.1) | $ (15) | $ (70.1) | $ (71.6) |
Realized gains on available-for-sale securities | (2.9) | (0.6) | (13) | (1.2) |
Realized losses on available-for-sale securities | 0.4 | 0.5 | 1.1 | 2.6 |
Impairment of intangible assets | 0 | 0 | 0 | 12.1 |
Gain on sale of assets | 0 | 0 | (1.9) | (4.1) |
Gain on sale of investment | 0 | 0 | (0.2) | 0 |
Non-service components of pension expense, net | (30) | (5.9) | (61.1) | (5.3) |
Other income, net | $ (44.6) | $ (21) | $ (145.2) | $ (67.5) |
Other Income, Net - Narrative (
Other Income, Net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Other Income and Expenses [Abstract] | ||||
Impairment of intangible assets | $ 0 | $ 0 | $ 0 | $ 12.1 |
Gain on sale of assets | $ 0 | $ 0 | $ (1.9) | $ (4.1) |
Corporate Investments and Fun_3
Corporate Investments and Funds Held For Clients (Corporate Investments And Funds Held For Clients) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Jun. 30, 2019 | ||
Debt Securities, Available-for-sale [Line Items] | ||||
Money market securities and other cash equivalents - amortized cost | $ 8,519 | $ 6,796.2 | ||
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 | 8,519 | 6,796.2 | ||
Amortized Cost | 23,548.1 | 24,571.6 | ||
Gross Unrealized Gains | 552.5 | 320.6 | ||
Gross Unrealized Losses | (77) | (33.1) | ||
Fair market value | 24,023.6 | [1] | 24,859.1 | [2] |
Total corporate investments and funds held for clients - amortized cost | 32,067.1 | 31,367.8 | ||
Total corporate investments and funds held for clients - gross unrealized gains | 552.5 | 320.6 | ||
Total corporate investments and funds held for clients - gross unrealized losses | (77) | (33.1) | ||
Total corporate investments and funds held for clients - fair market value | 32,542.6 | 31,655.3 | ||
Corporate Investments | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 3.2 | 271.9 | ||
Funds Held For Clients | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 24,020.4 | 24,587.2 | ||
Corporate bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 10,802.4 | 10,691.8 | ||
Gross Unrealized Gains | 226.4 | 182.8 | ||
Gross Unrealized Losses | (33) | (6.7) | ||
Fair market value | 10,995.8 | 10,867.9 | ||
Asset-backed securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 4,056.7 | 4,658.3 | ||
Gross Unrealized Gains | 27.4 | 37.8 | ||
Gross Unrealized Losses | (42.1) | (5.4) | ||
Fair market value | 4,042 | 4,690.7 | ||
U.S. Treasury securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 1,491.4 | 2,612 | ||
Gross Unrealized Gains | 61 | 17.7 | ||
Gross Unrealized Losses | 0 | (5.8) | ||
Fair market value | 1,552.4 | 2,623.9 | ||
U.S. government agency securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 3,585.9 | 2,933 | ||
Gross Unrealized Gains | 129.4 | 23.8 | ||
Gross Unrealized Losses | 0 | (8) | ||
Fair market value | 3,715.3 | 2,948.8 | ||
Canadian government obligations and Canadian government agency obligations | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 1,007 | 1,164.1 | ||
Gross Unrealized Gains | 16.2 | 7 | ||
Gross Unrealized Losses | (0.3) | (6) | ||
Fair market value | 1,022.9 | 1,165.1 | ||
Canadian provincial bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 731.4 | 800.2 | ||
Gross Unrealized Gains | 24.4 | 14.5 | ||
Gross Unrealized Losses | 0 | (0.5) | ||
Fair market value | 755.8 | 814.2 | ||
Municipal bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 581.4 | 596.1 | ||
Gross Unrealized Gains | 17 | 16.4 | ||
Gross Unrealized Losses | (0.5) | (0.1) | ||
Fair market value | 597.9 | 612.4 | ||
Other securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost | 1,291.9 | 1,116.1 | ||
Gross Unrealized Gains | 50.7 | 20.6 | ||
Gross Unrealized Losses | (1.1) | (0.6) | ||
Fair market value | $ 1,341.5 | $ 1,136.1 | ||
[1] | Included within available-for-sale securities are corporate investments with fair values of $3.2 million and funds held for clients with fair values of $24,020.4 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 $271.9 million and funds held for clients with fair values of $24,587.2 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
Corporate Investments and Fun_4
Corporate Investments and Funds Held For Clients (Available-For-Sale Securities That Have Been In An Unrealized Loss Position) (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 | ||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | $ (76,000,000) | $ (7,200,000) | ||
Fair market value of securities in unrealized loss position less than 12 months | 4,933,600,000 | 1,107,700,000 | ||
Unrealized losses greater than 12 months | (1,000,000) | (25,900,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 296,800,000 | 7,192,500,000 | ||
Total gross unrealized losses | (77,000,000) | (33,100,000) | ||
Total fair market value | 5,230,400,000 | 8,300,200,000 | ||
Fair market value | 24,023,600,000 | [1] | 24,859,100,000 | [2] |
Corporate bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | (32,900,000) | (600,000) | ||
Fair market value of securities in unrealized loss position less than 12 months | 2,811,000,000 | 151,900,000 | ||
Unrealized losses greater than 12 months | (100,000) | (6,100,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 12,000,000 | 2,055,600,000 | ||
Total gross unrealized losses | (33,000,000) | (6,700,000) | ||
Total fair market value | 2,823,000,000 | 2,207,500,000 | ||
Fair market value | 10,995,800,000 | 10,867,900,000 | ||
Asset-backed securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | (41,200,000) | (200,000) | ||
Fair market value of securities in unrealized loss position less than 12 months | 1,954,600,000 | 171,900,000 | ||
Unrealized losses greater than 12 months | (900,000) | (5,200,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 281,600,000 | 2,083,500,000 | ||
Total gross unrealized losses | (42,100,000) | (5,400,000) | ||
Total fair market value | 2,236,200,000 | 2,255,400,000 | ||
Fair market value | 4,042,000,000 | 4,690,700,000 | ||
U.S. government agency securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | 0 | 0 | ||
Fair market value of securities in unrealized loss position less than 12 months | 2,500,000 | 1,800,000 | ||
Unrealized losses greater than 12 months | 0 | (8,000,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 1,159,400,000 | ||
Total gross unrealized losses | 0 | (8,000,000) | ||
Total fair market value | 2,500,000 | 1,161,200,000 | ||
Fair market value | 3,715,300,000 | 2,948,800,000 | ||
U.S. Treasury securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | 0 | 0 | ||
Fair market value of securities in unrealized loss position less than 12 months | 0 | 0 | ||
Unrealized losses greater than 12 months | 0 | (5,800,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 1,671,400,000 | ||
Total gross unrealized losses | 0 | (5,800,000) | ||
Total fair market value | 0 | 1,671,400,000 | ||
Fair market value | 1,552,400,000 | 2,623,900,000 | ||
Canadian government obligations and Canadian government agency obligations | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | (300,000) | (6,000,000) | ||
Fair market value of securities in unrealized loss position less than 12 months | 24,600,000 | 662,700,000 | ||
Unrealized losses greater than 12 months | 0 | 0 | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 1,100,000 | ||
Total gross unrealized losses | (300,000) | (6,000,000) | ||
Total fair market value | 24,600,000 | 663,800,000 | ||
Fair market value | 1,022,900,000 | 1,165,100,000 | ||
Canadian provincial bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | 0 | (300,000) | ||
Fair market value of securities in unrealized loss position less than 12 months | 7,700,000 | 81,500,000 | ||
Unrealized losses greater than 12 months | 0 | (200,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 50,100,000 | ||
Total gross unrealized losses | 0 | (500,000) | ||
Total fair market value | 7,700,000 | 131,600,000 | ||
Fair market value | 755,800,000 | 814,200,000 | ||
Municipal bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | (500,000) | 0 | ||
Fair market value of securities in unrealized loss position less than 12 months | 44,100,000 | 1,500,000 | ||
Unrealized losses greater than 12 months | 0 | (100,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 0 | 23,300,000 | ||
Total gross unrealized losses | (500,000) | (100,000) | ||
Total fair market value | 44,100,000 | 24,800,000 | ||
Fair market value | 597,900,000 | 612,400,000 | ||
Other securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Unrealized losses less than 12 months | (1,100,000) | (100,000) | ||
Fair market value of securities in unrealized loss position less than 12 months | 89,100,000 | 36,400,000 | ||
Unrealized losses greater than 12 months | 0 | (500,000) | ||
Fair market value of securities in unrealized loss positions greater than 12 months | 3,200,000 | 148,100,000 | ||
Total gross unrealized losses | (1,100,000) | (600,000) | ||
Total fair market value | 92,300,000 | 184,500,000 | ||
Fair market value | 1,341,500,000 | $ 1,136,100,000 | ||
Fair Value, Inputs, Level 1 | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 0 | |||
Fair Value, Inputs, Level 3 | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | $ 0 | |||
[1] | Included within available-for-sale securities are corporate investments with fair values of $3.2 million and funds held for clients with fair values of $24,020.4 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 $271.9 million and funds held for clients with fair values of $24,587.2 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
Corporate Investments and Fun_5
Corporate Investments and Funds Held For Clients (Narrative) (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Jun. 30, 2019 | |||
Debt Securities, Available-for-sale [Line Items] | ||||
Earliest Corporate bond debt maturity date | April 2020 | |||
Latest corporate debt maturity date | March 2030 | |||
Fair market value | $ 24,023,600,000 | [1] | $ 24,859,100,000 | [2] |
Earliest U.S. treasury maturity date | April 2020 | |||
Latest U.S treasury maturity date | December 2029 | |||
Client fund obligation repayment period | 1 year | |||
Client funds obligations | $ 30,359,000,000 | 29,144,500,000 | ||
Client funds held in grantor trust | $ 27,689,800,000 | $ 26,648,000,000 | ||
Client funds investments with original maturities | ninety days or less | |||
Percentage of the available-for-sale securities were rated AAA Or AA | 77.00% | |||
Fair Value, Inputs, Level 1 [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | $ 0 | |||
Fair Value, Inputs, Level 3 [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 0 | |||
Federal Home Loan Banks | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 648,500,000 | |||
Federal Farm Credit Banks | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 698,400,000 | |||
U.S. government agency securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 91,700,000 | |||
Fixed Rate Credit Card | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 1,483,600,000 | |||
Asset-Backed Auto Loan Receivables | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 2,045,200,000 | |||
Asset-Backed Equipment Lease Receivable | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 391,500,000 | |||
Rate Reduction | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 121,000,000 | |||
Supranational Bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | 190,200,000 | |||
Commercial Mortgage Backed Securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Fair market value | $ 859,000,000 | |||
[1] | Included within available-for-sale securities are corporate investments with fair values of $3.2 million and funds held for clients with fair values of $24,020.4 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 $271.9 million and funds held for clients with fair values of $24,587.2 million. All available-for-sale securities were included in Level 2 of the fair value hierarchy. |
Corporate Investments and Fun_6
Corporate Investments and Funds Held For Clients (Classification Of Corporate Investments On The Consolidated Balance Sheets) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | |
Corporate Investments And Funds Held For Clients [Abstract] | ||||
Cash and cash equivalents | $ 1,705 | $ 1,949.2 | $ 1,826.2 | |
Short-term marketable securities | 3.2 | 10.5 | ||
Long-term marketable securities | [1] | 0 | 261.4 | |
Total corporate investments | $ 1,708.2 | $ 2,221.1 | ||
[1] | (a) - Long-term marketable securities are included within Other assets on the Consolidated Balance Sheets. |
Corporate Investments and Fun_7
Corporate Investments and Funds Held For Clients (Schedule Of Investment Of Funds Held For Clients) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | [1] | |
Debt Securities, Available-for-sale [Line Items] | |||||
Restricted cash and cash equivalents held to satisfy client funds obligations | $ 6,814 | [1] | $ 4,847 | $ 12,385.3 | |
Total funds held for clients | 30,834.4 | 29,434.2 | |||
Current | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Available-for-sale securities, restricted | 5,799 | 5,013.9 | |||
Non-current | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Available-for-sale securities, restricted | $ 18,221.4 | $ 19,573.3 | |||
[1] | See Note 6 for a reconciliation of restricted cash and restricted cash equivalents in funds held for clients on the Consolidated Balance Sheets. |
Corporate Investments and Fun_8
Corporate Investments and Funds Held For Clients (Expected Maturities Of Available-For-Sale Securities) (Details) $ in Millions | Mar. 31, 2020USD ($) |
Corporate Investments And Funds Held For Clients [Abstract] | |
One year or less | $ 5,802.2 |
One year to two years | 4,387 |
Two years to three years | 4,904.9 |
Three years to four years | 3,369.3 |
After four years | 5,560.2 |
Total available-for-sale securities | $ 24,023.6 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Jul. 01, 2019 | Jun. 30, 2019 |
Leases [Abstract] | |||
Operating lease, contract term | 11 years | ||
Operating lease right-of-use asset | $ 521.1 | $ 573.3 | $ 0 |
Operating lease liability, current | 98.2 | ||
Operating lease liabilities | $ 361.2 | $ 522.6 | $ 0 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Mar. 31, 2020 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating lease cost | $ 34.8 | $ 121.3 |
Short-term lease cost | 1.6 | 5.6 |
Variable lease cost | 2.9 | 4.9 |
Operating lease cost | $ 39.3 | $ 131.8 |
Leases - Right of Use Assets an
Leases - Right of Use Assets and Operating Lease Liabilities (Details) $ in Millions | 9 Months Ended |
Mar. 31, 2020USD ($) | |
Leases [Abstract] | |
Cash paid for operating lease liabilities | $ 186.9 |
Operating lease ROU assets obtained in exchange for new operating lease liabilities | $ 142.9 |
Weighted-average remaining lease term (in years) | 6 years |
Weighted-average discount rate | 2.30% |
Leases - Operating Lease Maturi
Leases - Operating Lease Maturities (Details) $ in Millions | Mar. 31, 2020USD ($) |
Leases [Abstract] | |
Lessee, Operating Lease, Liability, Payments, Remainder of Fiscal Year | $ 28.2 |
Twelve months ending June 30, 2021 | 103.9 |
Twelve months ending June 30, 2022 | 89 |
Twelve months ending June 30, 2023 | 76.5 |
Twelve months ending June 30, 2024 | 56.4 |
Thereafter | 139.6 |
Total undiscounted lease obligations | 493.6 |
Less: Imputed interest | (34.2) |
Net lease obligations | $ 459.4 |
Goodwill and Intangibles Asse_2
Goodwill and Intangibles Assets, net - Changes In Goodwill (Details) - USD ($) $ in Millions | 9 Months Ended | |
Mar. 31, 2020 | Jun. 30, 2019 | |
Goodwill [Roll Forward] | ||
Goodwill | $ 2,299.3 | $ 2,323 |
Additions and other adjustments | (2.5) | |
Currency translation adjustments | (21.2) | |
Balance at March 31, 2020 | 2,299.3 | |
Employer Services | ||
Goodwill [Roll Forward] | ||
Goodwill | 2,294.5 | 2,318.2 |
Additions and other adjustments | (2.5) | |
Currency translation adjustments | (21.2) | |
Balance at March 31, 2020 | 2,294.5 | |
PEO Services | ||
Goodwill [Roll Forward] | ||
Goodwill | 4.8 | $ 4.8 |
Additions and other adjustments | 0 | |
Currency translation adjustments | 0 | |
Balance at March 31, 2020 | $ 4.8 |
Goodwill and Intangibles Asse_3
Goodwill and Intangibles Assets, net - Components Of Finite-Lived Intangible Assets (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Jun. 30, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | $ 3,814.9 | $ 3,617.9 |
Total - accumulated amortization | (2,708.2) | (2,546.4) |
Intangible assets, net | 1,106.7 | 1,071.5 |
Software and software licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | 2,673.9 | 2,519.3 |
Total - accumulated amortization | (1,880) | (1,762.3) |
Customer contracts and lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | 901.9 | 860.7 |
Total - accumulated amortization | (606.6) | (566.4) |
Other intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total - gross | 239.1 | 237.9 |
Total - accumulated amortization | $ (221.6) | $ (217.7) |
Goodwill and Intangibles Asse_4
Goodwill and Intangibles Assets, net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Useful life | 6 years | |||
Amortization of intangible assets | $ 71.9 | $ 57.1 | $ 211 | $ 166 |
Software and software licenses | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Useful life | 6 years | |||
Customer contracts and lists | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Useful life | 5 years | |||
Other intangibles | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Useful life | 4 years |
Goodwill and Intangibles Asse_5
Goodwill and Intangibles Assets, net - Schedule Of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Millions | Mar. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Three months ended June 30, 2020 | $ 77.2 |
Twelve months ending June 30, 2021 | 257.2 |
Twelve months ending June 30, 2022 | 206.4 |
Twelve months ending June 30, 2023 | 167.7 |
Twelve months ending June 30, 2024 | 129.3 |
Twelve months ending June 30, 2025 | $ 79.1 |
Short-term Financing (Details)
Short-term Financing (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | ||
Short-term Debt [Line Items] | ||||||
Obligations under reverse repurchase agreements | [1] | $ 0 | $ 0 | $ 262,000,000 | ||
Maturities of short-term funding agreements | overnight to up to five business days | |||||
Commercial paper | 0 | $ 0 | ||||
364-day credit agreement | ||||||
Short-term Debt [Line Items] | ||||||
Maximum borrowing capacity under credit facilities | 3,800,000,000 | $ 3,800,000,000 | ||||
Term of credit agreement | 364 days | |||||
Extension option term | 1 year | |||||
Credit Facility Expiring In June 2024 | ||||||
Short-term Debt [Line Items] | ||||||
Maximum borrowing capacity under credit facilities | 2,750,000,000 | $ 2,750,000,000 | ||||
Term of credit agreement | 5 years | |||||
Line of credit facility potentially available increase in maximum borrowing capacity | $ 500,000,000 | |||||
Credit Facility Expiring In June 2023 | ||||||
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 | |||||
Line of credit facility potentially available increase in maximum borrowing capacity | $ 500,000,000 | |||||
Commercial paper program | ||||||
Short-term Debt [Line Items] | ||||||
Maximum borrowing capacity under credit facilities | 10,300,000,000 | $ 10,300,000,000 | ||||
Maturities of commercial paper range | overnight to up to 364 days | |||||
Short-term debt, average outstanding amount | $ 1,200,000,000 | $ 1,100,000,000 | $ 2,900,000,000 | $ 2,900,000,000 | ||
Debt instrument, interest rate during period | 1.50% | 2.40% | 1.90% | 2.20% | ||
Short Term Commercial Paper Program | ||||||
Short-term Debt [Line Items] | ||||||
Commercial paper weighted average maturity | 1 day | 1 day | 2 days | 2 days | ||
Reverse repurchase agreements | ||||||
Short-term Debt [Line Items] | ||||||
Short-term debt, average outstanding amount | $ 123,200,000 | $ 93,100,000 | $ 295,900,000 | $ 306,100,000 | ||
Debt instrument, interest rate during period | 1.60% | 1.80% | 1.80% | 1.80% | ||
[1] | (A) As of June 30, 2019, $261.4 million of long-term marketable securities and $0.6 million of cash and cash equivalents have been pledged as collateral under the Company's reverse repurchase agreements. Refer to Note 9 |
Long-term Debt (Details)
Long-term Debt (Details) - USD ($) | 9 Months Ended | |
Mar. 31, 2020 | Jun. 30, 2019 | |
Debt Instrument [Line Items] | ||
Aggregate principal amount | $ 2,000,000,000 | |
Notes payable | 2,008,700,000 | $ 2,010,900,000 |
Less: current portion | (1,001,800,000) | (2,500,000) |
Less: unamortized discount and debt issuance costs | (4,100,000) | (6,200,000) |
Total long-term debt | 1,002,800,000 | 2,002,200,000 |
Fair value of notes issued | 2,070,000,000 | |
Derivative, notional amount | $ 400,000,000 | |
Fixed-rate 2.250% notes due September 15, 2020 | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 5 years | |
Debt instrument effective rate (percent) | 2.37% | |
Notes payable | $ 1,000,000,000 | 1,000,000,000 |
Stated interest rate | 2.25% | |
Fixed-rate 3.375% notes due September 15, 2025 | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 10 years | |
Debt instrument effective rate (percent) | 3.47% | |
Notes payable | $ 1,000,000,000 | 1,000,000,000 |
Stated interest rate | 3.375% | |
Other | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 8,700,000 | $ 10,900,000 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Nov. 12, 2019 | Aug. 28, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Stock repurchase program, authorized amount | $ 5,000 | |||||
Stock repurchase program, shares authorized (in shares) | 25 | |||||
Treasury stock acquired (shares) | 2.5 | 1.6 | 6.2 | 5.4 | ||
Treasury stock acquired, value | $ 383.8 | $ 228 | $ 1,087.8 | $ 822.1 | ||
November 2019 Authorization | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Treasury stock acquired, value | $ 536.6 |
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, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | $ 33.4 | $ 45.2 | $ 106.7 | $ 122.2 |
Operating expenses | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | 3 | 4.1 | 10.5 | 12.9 |
Selling, general and administrative expenses | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | 26.1 | 36.1 | 82.3 | 94.6 |
System development and programming costs | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total pre-tax stock-based compensation expense | $ 4.3 | $ 5 | $ 13.9 | $ 14.7 |
Employee Benefit Plans (Compo_2
Employee Benefit Plans (Components Of Net Pension Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Retirement Benefits [Abstract] | ||||
Service cost – benefits earned during the period | $ 14.9 | $ 14.9 | $ 44.8 | $ 44.9 |
Interest cost on projected benefits | 15.5 | 19.7 | 46.3 | 59 |
Expected return on plan assets | (29.5) | (32.9) | (88.4) | (98.9) |
Net amortization and deferral | 1.9 | 0 | 4.8 | 0.1 |
Settlement charges, special termination benefits and plan curtailment | 17 | (7.8) | 22.1 | (35.9) |
Net pension expense | $ (14.2) | $ 9.5 | $ (14.6) | $ 41 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 23.80% | 23.40% | 22.50% | 23.40% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ 5,364.4 | $ 4,763.9 | $ 5,399.9 | $ 4,735.9 |
Net earnings | 820.9 | 753.7 | 2,054.9 | 1,817.4 |
Other comprehensive income | (3.2) | 203.1 | 22.9 | 267.9 |
Stock-based compensation expense | 30.8 | 35.8 | 98.1 | 105.4 |
Issuances relating to stock compensation plans | 53.6 | 61.9 | 141.7 | 137.1 |
Treasury stock acquired | $ (383.8) | $ (228) | $ (1,087.8) | $ (822.1) |
Treasury stock acquired (shares) | 2.5 | 1.6 | 6.2 | 5.4 |
Dividends declared (in US$ per share) | $ 0.91 | $ 0.79 | $ 2.61 | $ 2.27 |
Dividends declared | $ (392) | $ (344.2) | $ (1,132.1) | $ (995.4) |
Other | (6.9) | (6.9) | ||
Ending balance | 5,490.7 | 5,246.2 | 5,490.7 | 5,246.2 |
Common Stock | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | 63.9 | 63.9 | 63.9 | 63.9 |
Ending balance | 63.9 | 63.9 | 63.9 | 63.9 |
Capital in Excess of Par Value | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | 1,253.7 | 1,076.1 | 1,183.2 | 1,014.8 |
Stock-based compensation expense | 30.8 | 35.8 | 98.1 | 105.4 |
Issuances relating to stock compensation plans | 30.6 | 28.3 | 33.8 | 20 |
Ending balance | 1,315.1 | 1,140.2 | 1,315.1 | 1,140.2 |
Retained Earnings | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | 17,987.6 | 16,959.1 | 17,500.6 | 16,546.6 |
Net earnings | 820.9 | 753.7 | 2,054.9 | 1,817.4 |
Dividends declared | (392) | (344.2) | (1,132.1) | (995.4) |
Other | (6.9) | (6.9) | ||
Ending balance | 18,416.5 | 17,368.6 | 18,416.5 | 17,368.6 |
Treasury Stock | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | (13,709.6) | (12,720.2) | (13,090.5) | (12,209.6) |
Issuances relating to stock compensation plans | 23 | 33.6 | 107.9 | 117.1 |
Treasury stock acquired | (383.8) | (228) | (1,087.8) | (822.1) |
Ending balance | (14,070.4) | (12,914.6) | (14,070.4) | (12,914.6) |
AOCI | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | (231.2) | (615) | (257.3) | (679.8) |
Other comprehensive income | (3.2) | 203.1 | 22.9 | 267.9 |
Ending balance | $ (234.4) | $ (411.9) | $ (234.4) | $ (411.9) |
Reclassifications out of Accu_3
Reclassifications out of Accumulated Other Comprehensive Income (AOCI) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | ||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | $ (231.2) | $ (615) | $ (257.3) | $ (679.8) | |
Other comprehensive (loss)/income before reclassification adjustments | 32.7 | 256.7 | 79.5 | 327.1 | |
Tax effect | (22.7) | (58) | (36.2) | (84.8) | |
Reclassification adjustments to net earnings | (17.5) | 6 | (26.7) | 33.9 | |
Tax effect | 4.3 | (1.6) | 6.3 | (8.3) | |
Accumulated other comprehensive income, ending balance | (234.4) | (411.9) | (234.4) | (411.9) | |
Currency Translation Adjustment | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | (283.8) | (274.6) | (269.2) | (227) | |
Other comprehensive (loss)/income before reclassification adjustments | (68.4) | (2.3) | (83) | (49.9) | |
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 | (352.2) | (276.9) | (352.2) | (276.9) | |
Net Gains/Losses on Available-for-sale Securities | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | 264.6 | (181.5) | 224.6 | (274) | |
Other comprehensive (loss)/income before reclassification adjustments | 139.3 | 259 | 199.9 | 377 | |
Tax effect | (32.2) | (58) | (45.4) | (84.8) | |
Reclassification adjustments to net earnings | [1] | (2.5) | (0.1) | (11.9) | 1.4 |
Tax effect | 0.6 | 0 | 2.6 | (0.2) | |
Accumulated other comprehensive income, ending balance | 369.8 | 19.4 | 369.8 | 19.4 | |
Pension Liability | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | (212.5) | (158.9) | (212.7) | (178.8) | |
Other comprehensive (loss)/income before reclassification adjustments | 0 | 0 | 0 | 0 | |
Tax effect | 0 | 0 | 0 | 0 | |
Reclassification adjustments to net earnings | [2] | (15) | 6.1 | (14.8) | 32.5 |
Tax effect | 3.7 | (1.6) | 3.7 | (8.1) | |
Accumulated other comprehensive income, ending balance | (223.8) | $ (154.4) | (223.8) | $ (154.4) | |
Other | |||||
AOCI Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income, beginning balance | 0.5 | 0 | |||
Other comprehensive (loss)/income before reclassification adjustments | (38.2) | (37.4) | |||
Tax effect | 9.5 | 9.2 | |||
Reclassification adjustments to net earnings | [2] | 0 | 0 | ||
Tax effect | 0 | 0 | |||
Accumulated other comprehensive income, ending balance | $ (28.2) | $ (28.2) | |||
[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 11). The three and nine months ended March 31, 2020, include $17.0 million of prior service credits which were recognized as a component of net pension expense as a result of the US pension plan freeze. |
Interim Financial Data by Seg_3
Interim Financial Data by Segment (Narrative) (Details) | 9 Months Ended |
Mar. 31, 2020segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Interim Financial Data by Seg_4
Interim Financial Data by Segment (Financial Data By Strategic Business Unit Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ (4,047.8) | $ (3,828.2) | $ (11,213) | $ (10,630.9) |
Earnings before Income Taxes | 1,076.7 | 984.5 | 2,651.3 | 2,372.3 |
Employer Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (2,811.7) | (2,719.1) | (7,790.6) | (7,507.7) |
Earnings before Income Taxes | 1,025 | 963.1 | 2,473.4 | 2,335.9 |
PEO Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (1,238.3) | (1,115.5) | (3,429.8) | (3,135.1) |
Earnings before Income Taxes | 172.6 | 154.7 | 488.1 | 455.7 |
Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (2.2) | (6.4) | (7.4) | (11.9) |
Earnings before Income Taxes | $ (120.9) | $ (133.3) | $ (310.2) | $ (419.3) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended | |
May 01, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | |
Subsequent Event [Line Items] | |||
Debt Securities, Available-for-sale | $ 24,023.6 | ||
Proceeds from the sales and maturities of corporate and client funds marketable securities | $ 4,749.9 | $ 2,090.6 | |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Debt Securities, Available-for-sale, Realized Gain | $ 0.7 | ||
Proceeds from the sales and maturities of corporate and client funds marketable securities | $ 1,300 |