Delaware
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22-1467904
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(State or other jurisdiction of incorporation or
organization)
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(IRS Employer Identification No.)
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One ADP Boulevard, Roseland, New Jersey
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07068
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer [x]
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Accelerated filer [ ]
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Non-accelerated filer [ ]
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(Do not check if a smaller reporting company)
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Smaller reporting company [ ]
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Emerging growth company [ ]
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Page
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Statements of Consolidated Earnings
Three and nine months ended March 31, 2018 and 2017 |
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Statements of Consolidated Comprehensive Income
Three and nine months ended March 31, 2018 and 2017 |
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Consolidated Balance Sheets
At March 31, 2018 and June 30, 2017 |
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Statements of Consolidated Cash Flows
Nine Months Ended March 31, 2018 and 2017 |
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Three Months Ended
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Nine Months Ended
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March 31,
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March 31,
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2018
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2017
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2018
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2017
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REVENUES:
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Revenues, other than interest on funds held
for clients and PEO revenues
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$
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2,492.9
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$
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2,329.8
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$
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6,762.7
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$
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6,444.4
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Interest on funds held for clients
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134.8
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111.6
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340.9
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292.6
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PEO revenues (A)
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1,065.3
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969.4
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2,903.6
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2,577.9
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TOTAL REVENUES
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3,693.0
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3,410.8
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10,007.2
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9,314.9
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EXPENSES:
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Costs of revenues:
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Operating expenses
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1,844.7
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1,701.5
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5,210.6
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4,793.4
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Systems development and programming costs
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162.5
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153.3
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477.6
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460.6
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Depreciation and amortization
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70.2
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56.2
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202.1
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168.4
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TOTAL COSTS OF REVENUES
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2,077.4
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1,911.0
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5,890.3
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5,422.4
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Selling, general, and administrative expenses
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755.1
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665.0
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2,134.8
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1,953.6
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Interest expense
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18.6
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16.8
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74.1
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57.2
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TOTAL EXPENSES
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2,851.1
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2,592.8
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8,099.2
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7,433.2
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Other income, net
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(10.7
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(9.9
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(58.5
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(261.0
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EARNINGS BEFORE INCOME TAXES
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852.6
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827.9
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1,966.5
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2,142.7
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Provision for income taxes
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209.5
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240.0
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454.4
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675.1
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NET EARNINGS
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$
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643.1
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$
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587.9
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$
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1,512.1
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$
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1,467.6
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BASIC EARNINGS PER SHARE
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$
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1.46
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$
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1.32
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$
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3.42
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$
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3.27
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DILUTED EARNINGS PER SHARE
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$
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1.45
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$
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1.31
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$
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3.40
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$
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3.25
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Basic weighted average shares outstanding
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441.0
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446.5
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441.5
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448.9
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Diluted weighted average shares outstanding
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443.4
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449.2
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444.1
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451.3
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Dividends declared per common share
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$
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0.630
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$
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0.570
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$
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1.830
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$
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1.670
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Three Months Ended
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Nine Months Ended
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March 31,
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March 31,
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2018
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2017
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2018
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2017
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Net earnings
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$
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643.1
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$
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587.9
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$
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1,512.1
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$
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1,467.6
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Other comprehensive income/loss:
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Currency translation adjustments
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21.1
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20.3
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67.7
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(23.9
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Unrealized net (losses)/gains on available-for-sale securities
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(240.4
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46.3
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(400.6
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(438.3
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Tax effect
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53.4
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(16.5
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109.9
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155.1
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Reclassification of net losses/(gains) on available-for-sale securities to net earnings
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0.2
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0.2
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1.3
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(1.1
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Tax effect
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0.1
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(0.1
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(0.2
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0.3
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Reclassification of pension liability adjustment to net earnings
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2.3
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5.1
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6.9
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15.3
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Tax effect
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(0.6
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(1.8
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(2.3
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(5.5
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Other comprehensive (loss)/income, net of tax
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(163.9
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53.5
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(217.3
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(298.1
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)
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Comprehensive income
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$
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479.2
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$
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641.4
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$
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1,294.8
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$
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1,169.5
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March 31,
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June 30,
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2018
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2017
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Assets
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Current assets:
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Cash and cash equivalents
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$
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2,293.6
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$
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2,780.4
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Accounts receivable, net of allowance for doubtful accounts of $51.9 and $49.6, respectively
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2,043.4
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1,703.6
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Other current assets
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730.3
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883.2
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Total current assets before funds held for clients
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5,067.3
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5,367.2
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Funds held for clients
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33,646.7
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27,291.5
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Total current assets
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38,714.0
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32,658.7
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Long-term receivables, net of allowance for doubtful accounts of $0.4 and $0.8, respectively
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27.3
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28.0
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Property, plant and equipment, net
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794.6
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779.9
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Other assets
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1,391.0
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1,352.2
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Goodwill
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2,263.3
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1,741.0
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Intangible assets, net
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875.3
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620.2
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Total assets
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$
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44,065.5
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$
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37,180.0
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Liabilities and Stockholders' Equity
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Current liabilities:
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Accounts payable
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$
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105.7
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$
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149.7
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Accrued expenses and other current liabilities
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1,505.3
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1,381.9
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Accrued payroll and payroll-related expenses
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595.8
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562.5
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Dividends payable
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275.1
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250.5
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Short-term deferred revenues
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235.4
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232.9
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Income taxes payable
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80.2
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49.0
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Total current liabilities before client funds obligations
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2,797.5
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2,626.5
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Client funds obligations
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33,943.7
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27,189.4
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Total current liabilities
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36,741.2
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29,815.9
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Long-term debt
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2,002.4
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2,002.4
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Other liabilities
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795.8
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830.2
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Deferred income taxes
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105.5
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163.1
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|
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Long-term deferred revenues
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391.4
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391.4
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Total liabilities
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40,036.3
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33,203.0
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Commitments and contingencies (Note 14)
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Stockholders' equity:
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Preferred stock, $1.00 par value: authorized, 0.3 shares; issued, none
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—
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—
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Common stock, $0.10 par value: authorized, 1,000.0 shares; issued, 638.7 shares at March 31, 2018 and June 30, 2017;
outstanding, 441.7 and 445.0 shares at March 31, 2018 and June 30, 2017, respectively |
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63.9
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63.9
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Capital in excess of par value
|
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964.1
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867.8
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Retained earnings
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15,466.1
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14,728.2
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Treasury stock - at cost: 197.0 and 193.7 shares at March 31, 2018 and June 30, 2017, respectively
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(11,826.1
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)
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(11,303.7
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)
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Accumulated other comprehensive loss
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(638.8
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)
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(379.2
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)
|
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Total stockholders’ equity
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4,029.2
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3,977.0
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Total liabilities and stockholders’ equity
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$
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44,065.5
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$
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37,180.0
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Nine Months Ended
|
||||||
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March 31,
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2018
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2017
*As Adjusted
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Cash Flows from Operating Activities:
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Net earnings
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$
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1,512.1
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$
|
1,467.6
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Adjustments to reconcile net earnings to cash flows provided by operating activities:
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Depreciation and amortization
|
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278.3
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233.6
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Deferred income taxes
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18.0
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22.2
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Stock-based compensation expense
|
|
119.4
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101.2
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Net pension expense
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8.2
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18.1
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Net amortization of premiums and accretion of discounts on available-for-sale securities
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55.6
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66.1
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Gain on sale of divested businesses, net of tax
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—
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|
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(121.4
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)
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Other
|
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22.0
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24.8
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Changes in operating assets and liabilities, net of effects from acquisitions and divestitures of businesses:
|
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Increase in accounts receivable
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(239.3
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)
|
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(90.1
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)
|
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Increase in other assets
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(38.6
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)
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(152.9
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)
|
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Decrease in accounts payable
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(31.1
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)
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(29.5
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)
|
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Increase in accrued expenses and other liabilities
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105.4
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129.0
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Net cash flows provided by operating activities
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1,810.0
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1,668.7
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Cash Flows from Investing Activities:
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Purchases of corporate and client funds marketable securities
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(3,692.7
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)
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(3,470.0
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)
|
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Proceeds from the sales and maturities of corporate and client funds marketable securities
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2,702.5
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2,704.6
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Capital expenditures
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(159.6
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)
|
|
(174.5
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)
|
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Additions to intangibles
|
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(195.8
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)
|
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(162.1
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)
|
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Acquisitions of businesses, net of cash acquired
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(612.4
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)
|
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(86.7
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)
|
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Proceeds from the sale of divested businesses
|
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—
|
|
|
234.0
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|
||
Net cash flows used in investing activities
|
|
(1,958.0
|
)
|
|
(954.7
|
)
|
||
|
|
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|
||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
||
Net increase in client funds obligations
|
|
6,700.2
|
|
|
636.7
|
|
||
Payments of debt
|
|
(6.8
|
)
|
|
(1.5
|
)
|
||
Repurchases of common stock
|
|
(596.2
|
)
|
|
(956.8
|
)
|
||
Net proceeds from stock purchase plan and stock-based compensation plans
|
|
46.1
|
|
|
74.5
|
|
||
Dividends paid
|
|
(785.1
|
)
|
|
(739.4
|
)
|
||
Net cash flows provided by / (used in) financing activities
|
|
5,358.2
|
|
|
(986.5
|
)
|
||
|
|
|
|
|
||||
Effect of exchange rate changes on cash, cash equivalents, restricted cash, and restricted cash equivalents
|
|
53.1
|
|
|
(81.1
|
)
|
||
|
|
|
|
|
||||
Net change in cash, cash equivalents, restricted cash, and restricted cash equivalents
|
|
5,263.3
|
|
|
(353.6
|
)
|
||
|
|
|
|
|
||||
Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of period
|
|
8,181.6
|
|
|
15,458.6
|
|
||
Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period
|
|
$
|
13,444.9
|
|
|
$
|
15,105.0
|
|
|
|
|
|
|
||||
Reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents to the Consolidated Balance Sheets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
2,293.6
|
|
|
$
|
2,995.5
|
|
Restricted cash and restricted cash equivalents included in funds held for clients (A)
|
|
11,151.3
|
|
|
12,109.5
|
|
||
Total cash, cash equivalents, restricted cash, and restricted cash equivalents
|
|
$
|
13,444.9
|
|
|
$
|
15,105.0
|
|
|
|
|
|
|
||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
||||
Cash paid for interest
|
|
$
|
86.5
|
|
|
$
|
69.8
|
|
Cash paid for income taxes, net of income tax refunds
|
|
$
|
423.0
|
|
|
$
|
569.2
|
|
|
Nine Months Ended
|
||||||||||
|
March 31, 2017
(unaudited)
|
||||||||||
|
As previously reported
|
|
Adjustments
|
|
As adjusted
|
||||||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||||||
Net decrease / (increase) in restricted cash and cash equivalents held to satisfy client funds obligations
|
$
|
87.7
|
|
|
$
|
(87.7
|
)
|
|
$
|
—
|
|
Net cash flows used in investing activities
|
(867.0
|
)
|
|
(87.7
|
)
|
|
(954.7
|
)
|
|||
Effect of exchange rate changes on cash, cash equivalents, restricted cash, and restricted cash equivalents
|
(10.8
|
)
|
|
(70.3
|
)
|
|
(81.1
|
)
|
|||
Net change in cash, cash equivalents, restricted cash, and restricted cash equivalents
|
(195.6
|
)
|
|
(158.0
|
)
|
|
(353.6
|
)
|
|||
Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period
|
$
|
2,995.5
|
|
|
$
|
12,109.5
|
|
|
$
|
15,105.0
|
|
Standard
|
Description
|
Effective Date
|
Effect on Financial Statements or Other Significant Matters
|
ASU 2017-07
Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost
|
This standard requires reporting the service cost component in the same line item or items as other compensation costs arising during the period in the Statements of Consolidated Earnings. The other components of net periodic pension cost are required to be presented in the Statements of Consolidated Earnings separately from the service cost component. Such changes are to be applied retrospectively from the date of adoption. The ASU also allows only the service cost component to be eligible for capitalization, when applicable, prospectively from the date of adoption.
|
For fiscal years beginning after December 15, 2017. Early adoption is permitted.
|
The Company will adopt ASU 2017-07 beginning on July 1, 2018. This ASU will be applied retrospectively and will require the reclassification of the non-service cost components of the net periodic benefit cost from within the respective line items of our Statements of Consolidated Earnings to Other income, net. Also, the requirement set forth under this ASU only allows the service cost component of net periodic benefit cost to be capitalized. The Company does not expect the adoption of the new accounting rules to have a material impact on the Company’s consolidated results of operations, financial condition, or cash flows.
|
|
|
|
|
Goodwill
|
$
|
404.2
|
|
Identifiable intangible assets
|
132.5
|
|
|
Other assets
|
3.2
|
|
|
Total assets acquired
|
$
|
539.9
|
|
|
|
||
Total liabilities acquired
|
$
|
48.9
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
Cumulative amount from inception through
|
||||||||||||||
|
March 31,
|
|
March 31,
|
|
March 31,
|
||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
||||||||||
Employee separation benefits (a)
|
$
|
11.8
|
|
|
$
|
(0.1
|
)
|
|
$
|
8.9
|
|
|
$
|
37.2
|
|
|
$
|
93.0
|
|
Other initiative costs (b)
|
1.3
|
|
|
0.7
|
|
|
4.2
|
|
|
4.4
|
|
|
10.1
|
|
|||||
Total (c)
|
$
|
13.1
|
|
|
$
|
0.6
|
|
|
$
|
13.1
|
|
|
$
|
41.6
|
|
|
$
|
103.1
|
|
|
Employee
separation benefits
|
|
Other initiative costs
|
|
Total
|
||||||
Balance at June 30, 2017
|
$
|
73.9
|
|
|
$
|
0.5
|
|
|
$
|
74.4
|
|
Charged to expense
|
21.8
|
|
|
4.2
|
|
|
26.0
|
|
|||
Reversals
|
(12.9
|
)
|
|
—
|
|
|
(12.9
|
)
|
|||
Cash payments
|
(25.9
|
)
|
|
(3.4
|
)
|
|
(29.3
|
)
|
|||
Non-cash utilization
|
—
|
|
|
(0.7
|
)
|
|
(0.7
|
)
|
|||
Balance at March 31, 2018
|
$
|
56.9
|
|
|
$
|
0.6
|
|
|
$
|
57.5
|
|
|
|
|
|
|
|
||||||
Balance at June 30, 2016
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Charged to expense
|
37.2
|
|
|
4.4
|
|
|
41.6
|
|
|||
Reversals
|
—
|
|
|
—
|
|
|
—
|
|
|||
Cash payments
|
(4.9
|
)
|
|
(2.4
|
)
|
|
(7.3
|
)
|
|||
Non-cash utilization
|
—
|
|
|
(1.6
|
)
|
|
(1.6
|
)
|
|||
Balance at March 31, 2017
|
$
|
32.3
|
|
|
$
|
0.4
|
|
|
$
|
32.7
|
|
|
|
Basic
|
|
Effect of Employee Stock Option Shares
|
|
Effect of
Employee
Restricted
Stock
Shares
|
|
Diluted
|
||||||
Three Months Ended March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net earnings
|
|
$
|
643.1
|
|
|
|
|
|
|
|
|
$
|
643.1
|
|
Weighted average shares (in millions)
|
|
441.0
|
|
|
1.0
|
|
|
1.4
|
|
|
443.4
|
|
||
EPS
|
|
$
|
1.46
|
|
|
|
|
|
|
|
|
$
|
1.45
|
|
Three Months Ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net earnings
|
|
$
|
587.9
|
|
|
|
|
|
|
|
|
$
|
587.9
|
|
Weighted average shares (in millions)
|
|
446.5
|
|
|
1.1
|
|
|
1.6
|
|
|
449.2
|
|
||
EPS
|
|
$
|
1.32
|
|
|
|
|
|
|
|
|
$
|
1.31
|
|
|
|
|
|
|
|
|
|
|
||||||
Nine Months Ended March 31, 2018
|
|
|
|
|
|
|
|
|
||||||
Net earnings
|
|
$
|
1,512.1
|
|
|
|
|
|
|
|
|
$
|
1,512.1
|
|
Weighted average shares (in millions)
|
|
441.5
|
|
|
1.1
|
|
|
1.5
|
|
|
444.1
|
|
||
EPS
|
|
$
|
3.42
|
|
|
|
|
|
|
|
|
$
|
3.40
|
|
Nine Months Ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net earnings
|
|
$
|
1,467.6
|
|
|
|
|
|
|
|
|
$
|
1,467.6
|
|
Weighted average shares (in millions)
|
|
448.9
|
|
|
0.9
|
|
|
1.5
|
|
|
451.3
|
|
||
EPS
|
|
$
|
3.27
|
|
|
|
|
|
|
|
|
$
|
3.25
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Interest income on corporate funds
|
$
|
(11.0
|
)
|
|
$
|
(10.1
|
)
|
|
$
|
(59.4
|
)
|
|
$
|
(54.5
|
)
|
Realized gains on available-for-sale securities
|
(1.3
|
)
|
|
(0.6
|
)
|
|
(1.9
|
)
|
|
(3.1
|
)
|
||||
Realized losses on available-for-sale securities
|
1.6
|
|
|
0.8
|
|
|
3.2
|
|
|
2.0
|
|
||||
Gain on sale of assets
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
||||
Gain on sale of businesses (see Note 4)
|
—
|
|
|
—
|
|
|
—
|
|
|
(205.4
|
)
|
||||
Other income, net
|
$
|
(10.7
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
(58.5
|
)
|
|
$
|
(261.0
|
)
|
|
March 31, 2018
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Market Value (A)
|
||||||||
Type of issue:
|
|
|
|
|
|
|
|
||||||||
Money market securities, cash and other cash equivalents
|
$
|
13,444.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
13,444.9
|
|
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
9,547.9
|
|
|
22.8
|
|
|
(134.5
|
)
|
|
9,436.2
|
|
||||
Asset-backed securities
|
4,457.0
|
|
|
0.4
|
|
|
(56.6
|
)
|
|
4,400.8
|
|
||||
U.S. government agency securities
|
2,912.9
|
|
|
5.6
|
|
|
(40.5
|
)
|
|
2,878.0
|
|
||||
U.S. Treasury securities
|
2,576.3
|
|
|
0.5
|
|
|
(66.4
|
)
|
|
2,510.4
|
|
||||
Canadian government obligations and
Canadian government agency obligations |
1,129.9
|
|
|
0.8
|
|
|
(20.7
|
)
|
|
1,110.0
|
|
||||
Canadian provincial bonds
|
735.8
|
|
|
6.2
|
|
|
(6.4
|
)
|
|
735.6
|
|
||||
Municipal bonds
|
592.0
|
|
|
3.0
|
|
|
(5.3
|
)
|
|
589.7
|
|
||||
Other securities
|
847.7
|
|
|
3.3
|
|
|
(9.0
|
)
|
|
842.0
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total available-for-sale securities
|
22,799.5
|
|
|
42.6
|
|
|
(339.4
|
)
|
|
22,502.7
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total corporate investments and funds held for clients
|
$
|
36,244.4
|
|
|
$
|
42.6
|
|
|
$
|
(339.4
|
)
|
|
$
|
35,947.6
|
|
|
June 30, 2017
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Market Value (B)
|
||||||||
Type of issue:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market securities, cash and other cash equivalents
|
$
|
8,181.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,181.6
|
|
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate bonds
|
9,325.3
|
|
|
98.8
|
|
|
(22.0
|
)
|
|
9,402.1
|
|
||||
Asset-backed securities
|
4,453.1
|
|
|
16.9
|
|
|
(8.6
|
)
|
|
4,461.4
|
|
||||
U.S. government agency securities
|
3,557.7
|
|
|
22.2
|
|
|
(13.4
|
)
|
|
3,566.5
|
|
||||
U.S. Treasury securities
|
1,585.9
|
|
|
2.6
|
|
|
(14.3
|
)
|
|
1,574.2
|
|
||||
Canadian government obligations and
Canadian government agency obligations |
1,053.6
|
|
|
2.9
|
|
|
(11.4
|
)
|
|
1,045.1
|
|
||||
Canadian provincial bonds
|
746.9
|
|
|
14.3
|
|
|
(1.4
|
)
|
|
759.8
|
|
||||
Municipal bonds
|
582.5
|
|
|
11.3
|
|
|
(1.3
|
)
|
|
592.5
|
|
||||
Other securities
|
493.6
|
|
|
7.3
|
|
|
(1.4
|
)
|
|
499.5
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total available-for-sale securities
|
21,798.6
|
|
|
176.3
|
|
|
(73.8
|
)
|
|
21,901.1
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total corporate investments and funds held for clients
|
$
|
29,980.2
|
|
|
$
|
176.3
|
|
|
$
|
(73.8
|
)
|
|
$
|
30,082.7
|
|
|
March 31, 2018
|
||||||||||||||||||||||
|
Securities in Unrealized Loss Position Less Than 12 Months
|
|
Securities in Unrealized Loss Position Greater Than 12 Months
|
|
Total
|
||||||||||||||||||
|
Gross
Unrealized Losses |
|
Fair Market
Value
|
|
Gross
Unrealized Losses |
|
Fair Market
Value
|
|
Gross
Unrealized
Losses
|
|
Fair
Market Value
|
||||||||||||
Corporate bonds
|
$
|
(96.7
|
)
|
|
$
|
6,932.3
|
|
|
$
|
(37.8
|
)
|
|
$
|
987.4
|
|
|
$
|
(134.5
|
)
|
|
$
|
7,919.7
|
|
Asset-backed securities
|
(40.1
|
)
|
|
3,327.7
|
|
|
(16.5
|
)
|
|
837.0
|
|
|
(56.6
|
)
|
|
4,164.7
|
|
||||||
U.S. government agency securities
|
(25.8
|
)
|
|
2,160.9
|
|
|
(14.7
|
)
|
|
433.1
|
|
|
(40.5
|
)
|
|
2,594.0
|
|
||||||
U.S. Treasury securities
|
(38.9
|
)
|
|
1,584.2
|
|
|
(27.5
|
)
|
|
867.7
|
|
|
(66.4
|
)
|
|
2,451.9
|
|
||||||
Canadian government obligations and
Canadian government agency obligations |
(20.7
|
)
|
|
927.4
|
|
|
—
|
|
|
—
|
|
|
(20.7
|
)
|
|
927.4
|
|
||||||
Canadian provincial bonds
|
(5.6
|
)
|
|
412.3
|
|
|
(0.8
|
)
|
|
40.1
|
|
|
(6.4
|
)
|
|
452.4
|
|
||||||
Municipal bonds
|
(4.6
|
)
|
|
331.8
|
|
|
(0.7
|
)
|
|
16.0
|
|
|
(5.3
|
)
|
|
347.8
|
|
||||||
Other securities
|
(7.8
|
)
|
|
506.7
|
|
|
(1.2
|
)
|
|
34.0
|
|
|
(9.0
|
)
|
|
540.7
|
|
||||||
|
$
|
(240.2
|
)
|
|
$
|
16,183.3
|
|
|
$
|
(99.2
|
)
|
|
$
|
3,215.3
|
|
|
$
|
(339.4
|
)
|
|
$
|
19,398.6
|
|
|
June 30, 2017
|
||||||||||||||||||||||
|
Securities in Unrealized Loss Position Less Than 12 Months
|
|
Securities in Unrealized Loss Position Greater Than 12 Months
|
|
Total
|
||||||||||||||||||
|
Gross
Unrealized Losses |
|
Fair Market
Value
|
|
Gross
Unrealized Losses |
|
Fair Market
Value
|
|
Gross
Unrealized
Losses
|
|
Fair
Market Value
|
||||||||||||
Corporate bonds
|
$
|
(22.0
|
)
|
|
$
|
2,619.9
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
|
$
|
(22.0
|
)
|
|
$
|
2,627.3
|
|
Asset-backed securities
|
(8.5
|
)
|
|
1,916.1
|
|
|
(0.1
|
)
|
|
11.3
|
|
|
(8.6
|
)
|
|
1,927.4
|
|
||||||
U.S. government agency securities
|
(13.4
|
)
|
|
1,935.3
|
|
|
—
|
|
|
—
|
|
|
(13.4
|
)
|
|
1,935.3
|
|
||||||
U.S. Treasury securities
|
(14.3
|
)
|
|
1,317.8
|
|
|
—
|
|
|
1.0
|
|
|
(14.3
|
)
|
|
1,318.8
|
|
||||||
Canadian government obligations and
Canadian government agency obligations |
(11.4
|
)
|
|
699.6
|
|
|
—
|
|
|
—
|
|
|
(11.4
|
)
|
|
699.6
|
|
||||||
Canadian provincial bonds
|
(1.4
|
)
|
|
179.8
|
|
|
—
|
|
|
—
|
|
|
(1.4
|
)
|
|
179.8
|
|
||||||
Municipal bonds
|
(1.2
|
)
|
|
98.8
|
|
|
(0.1
|
)
|
|
1.2
|
|
|
(1.3
|
)
|
|
100.0
|
|
||||||
Other securities
|
(1.3
|
)
|
|
148.0
|
|
|
(0.1
|
)
|
|
8.9
|
|
|
(1.4
|
)
|
|
156.9
|
|
||||||
|
$
|
(73.5
|
)
|
|
$
|
8,915.3
|
|
|
$
|
(0.3
|
)
|
|
$
|
29.8
|
|
|
$
|
(73.8
|
)
|
|
$
|
8,945.1
|
|
|
|
March 31,
|
|
June 30,
|
||||
|
|
2018
|
|
2017
|
||||
Corporate investments:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
2,293.6
|
|
|
$
|
2,780.4
|
|
Short-term marketable securities (a)
|
|
—
|
|
|
3.2
|
|
||
Long-term marketable securities (b)
|
|
7.3
|
|
|
7.6
|
|
||
Total corporate investments
|
|
$
|
2,300.9
|
|
|
$
|
2,791.2
|
|
|
|
March 31,
|
|
June 30,
|
||||
|
|
2018
|
|
2017
|
||||
Funds held for clients:
|
|
|
|
|
||||
Restricted cash and cash equivalents held to satisfy client funds obligations
|
|
$
|
11,151.3
|
|
|
$
|
5,401.2
|
|
Restricted short-term marketable securities held to satisfy client funds obligations
|
|
2,420.5
|
|
|
2,918.5
|
|
||
Restricted long-term marketable securities held to satisfy client funds obligations
|
|
20,074.9
|
|
|
18,971.8
|
|
||
Total funds held for clients
|
|
$
|
33,646.7
|
|
|
$
|
27,291.5
|
|
One year or less
|
$
|
2,420.5
|
|
One year to two years
|
4,783.9
|
|
|
Two years to three years
|
5,690.6
|
|
|
Three years to four years
|
3,808.7
|
|
|
After four years
|
5,799.0
|
|
|
Total available-for-sale securities
|
$
|
22,502.7
|
|
|
Employer
Services
|
|
PEO
Services
|
|
Total
|
||||||
Balance at June 30, 2017
|
$
|
1,736.2
|
|
|
$
|
4.8
|
|
|
$
|
1,741.0
|
|
Additions and other adjustments, net
|
491.3
|
|
|
—
|
|
|
491.3
|
|
|||
Currency translation adjustments
|
31.0
|
|
|
—
|
|
|
31.0
|
|
|||
Balance at March 31, 2018
|
$
|
2,258.5
|
|
|
$
|
4.8
|
|
|
$
|
2,263.3
|
|
|
|
March 31,
|
|
June 30,
|
||||
|
|
2018
|
|
2017
|
||||
Intangible assets:
|
|
|
|
|
||||
Software and software licenses
|
|
$
|
2,253.8
|
|
|
$
|
1,975.2
|
|
Customer contracts and lists
|
|
714.3
|
|
|
614.1
|
|
||
Other intangibles
|
|
237.4
|
|
|
228.2
|
|
||
|
|
3,205.5
|
|
|
2,817.5
|
|
||
Less accumulated amortization:
|
|
|
|
|
|
|
||
Software and software licenses
|
|
(1,588.1
|
)
|
|
(1,483.7
|
)
|
||
Customer contracts and lists
|
|
(530.8
|
)
|
|
(506.0
|
)
|
||
Other intangibles
|
|
(211.3
|
)
|
|
(207.6
|
)
|
||
|
|
(2,330.2
|
)
|
|
(2,197.3
|
)
|
||
Intangible assets, net
|
|
$
|
875.3
|
|
|
$
|
620.2
|
|
|
Amount
|
||
Three months ending June 30, 2018
|
$
|
52.1
|
|
Twelve months ending June 30, 2019
|
$
|
227.2
|
|
Twelve months ending June 30, 2020
|
$
|
197.9
|
|
Twelve months ending June 30, 2021
|
$
|
147.7
|
|
Twelve months ending June 30, 2022
|
$
|
110.0
|
|
Twelve months ending June 30, 2023
|
$
|
71.4
|
|
Debt instrument
|
|
Effective Interest Rate
|
|
March 31, 2018
|
|
June 30,
2017
|
||||
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
|
|
|
|
13.6
|
|
|
20.3
|
|
||
|
|
|
|
2,013.6
|
|
|
2,020.3
|
|
||
Less: current portion
|
|
|
|
(2.5
|
)
|
|
(7.8
|
)
|
||
Less: unamortized discount and debt issuance costs
|
|
|
|
(8.7
|
)
|
|
(10.1
|
)
|
||
Total long-term debt
|
|
|
|
$
|
2,002.4
|
|
|
$
|
2,002.4
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Operating expenses
|
$
|
4.8
|
|
|
$
|
4.6
|
|
|
$
|
15.4
|
|
|
$
|
16.4
|
|
Selling, general and administrative expenses
|
31.8
|
|
|
25.1
|
|
|
87.9
|
|
|
71.0
|
|
||||
System development and programming costs
|
5.1
|
|
|
4.6
|
|
|
16.1
|
|
|
13.8
|
|
||||
Total stock-based compensation expense
|
$
|
41.7
|
|
|
$
|
34.3
|
|
|
$
|
119.4
|
|
|
$
|
101.2
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
|
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
|
2018
|
|
2017
|
||||||||
Service cost – benefits earned during the period
|
$
|
18.7
|
|
|
$
|
20.2
|
|
|
|
$
|
55.9
|
|
|
$
|
60.6
|
|
Interest cost on projected benefits
|
16.4
|
|
|
14.9
|
|
|
|
49.0
|
|
|
45.0
|
|
||||
Expected return on plan assets
|
(34.4
|
)
|
|
(33.9
|
)
|
|
|
(103.0
|
)
|
|
(101.9
|
)
|
||||
Net amortization and deferral
|
2.1
|
|
|
4.8
|
|
|
|
6.3
|
|
|
14.4
|
|
||||
Net pension expense
|
$
|
2.8
|
|
|
$
|
6.0
|
|
|
|
$
|
8.2
|
|
|
$
|
18.1
|
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2018
|
||||||||||||||
|
Currency Translation Adjustment
|
|
Net Gains/Losses on Available-for-sale Securities
|
|
Pension Liability
|
|
Accumulated Other Comprehensive Loss
|
||||||||
Balance at December 31, 2017
|
$
|
(184.2
|
)
|
|
$
|
(34.6
|
)
|
|
$
|
(213.8
|
)
|
|
$
|
(432.6
|
)
|
Other comprehensive income/(loss)
before reclassification adjustments |
21.1
|
|
|
(240.4
|
)
|
|
—
|
|
|
(219.3
|
)
|
||||
Tax effect
|
—
|
|
|
53.4
|
|
|
—
|
|
|
53.4
|
|
||||
Reclassification adjustments to
net earnings |
—
|
|
|
0.2
|
|
(A)
|
2.3
|
|
(B)
|
2.5
|
|
||||
Tax effect
|
—
|
|
|
0.1
|
|
|
(0.6
|
)
|
|
(0.5
|
)
|
||||
Reclassification to retained earnings (C)
|
—
|
|
|
(7.1
|
)
|
|
(35.2
|
)
|
|
(42.3
|
)
|
||||
Balance at March 31, 2018
|
$
|
(163.1
|
)
|
|
$
|
(228.4
|
)
|
|
$
|
(247.3
|
)
|
|
$
|
(638.8
|
)
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2017
|
||||||||||||||
|
Currency Translation Adjustment
|
|
Net Gains/Losses on Available-for-sale Securities
|
|
Pension Liability
|
|
Accumulated Other Comprehensive Loss
|
||||||||
Balance at December 31, 2016
|
$
|
(298.0
|
)
|
|
$
|
19.9
|
|
|
$
|
(288.6
|
)
|
|
$
|
(566.7
|
)
|
Other comprehensive income
before reclassification adjustments |
20.3
|
|
|
46.3
|
|
|
—
|
|
|
66.6
|
|
||||
Tax effect
|
—
|
|
|
(16.5
|
)
|
|
—
|
|
|
(16.5
|
)
|
||||
Reclassification adjustments to
net earnings |
—
|
|
|
0.2
|
|
(A)
|
5.1
|
|
(B)
|
5.3
|
|
||||
Tax effect
|
—
|
|
|
(0.1
|
)
|
|
(1.8
|
)
|
|
(1.9
|
)
|
||||
Balance at March 31, 2017
|
$
|
(277.7
|
)
|
|
$
|
49.8
|
|
|
$
|
(285.3
|
)
|
|
$
|
(513.2
|
)
|
|
Nine Months Ended
|
||||||||||||||
|
March 31, 2018
|
||||||||||||||
|
Currency Translation Adjustment
|
|
Net Gains/Losses on Available-for-sale Securities
|
|
Pension Liability
|
|
Accumulated Other Comprehensive Loss
|
||||||||
Balance at June 30, 2017
|
$
|
(230.8
|
)
|
|
$
|
68.3
|
|
|
$
|
(216.7
|
)
|
|
$
|
(379.2
|
)
|
Other comprehensive income/(loss)
before reclassification adjustments |
67.7
|
|
|
(400.6
|
)
|
|
—
|
|
|
(332.9
|
)
|
||||
Tax effect
|
—
|
|
|
109.9
|
|
|
—
|
|
|
109.9
|
|
||||
Reclassification adjustments to
net earnings |
—
|
|
|
1.3
|
|
(A)
|
6.9
|
|
(B)
|
8.2
|
|
||||
Tax effect
|
—
|
|
|
(0.2
|
)
|
|
(2.3
|
)
|
|
(2.5
|
)
|
||||
Reclassification to retained earnings (C)
|
—
|
|
|
(7.1
|
)
|
|
(35.2
|
)
|
|
(42.3
|
)
|
||||
Balance at March 31, 2018
|
$
|
(163.1
|
)
|
|
$
|
(228.4
|
)
|
|
$
|
(247.3
|
)
|
|
$
|
(638.8
|
)
|
|
Nine Months Ended
|
||||||||||||||
|
March 31, 2017
|
||||||||||||||
|
Currency Translation Adjustment
|
|
Net Gains/Losses on Available-for-sale Securities
|
|
Pension Liability
|
|
Accumulated Other Comprehensive Loss
|
||||||||
Balance at June 30, 2016
|
$
|
(253.8
|
)
|
|
$
|
333.8
|
|
|
$
|
(295.1
|
)
|
|
$
|
(215.1
|
)
|
Other comprehensive loss
before reclassification adjustments |
(23.9
|
)
|
|
(438.3
|
)
|
|
—
|
|
|
(462.2
|
)
|
||||
Tax effect
|
—
|
|
|
155.1
|
|
|
—
|
|
|
155.1
|
|
||||
Reclassification adjustments to
net earnings |
—
|
|
|
(1.1
|
)
|
(A)
|
15.3
|
|
(B)
|
14.2
|
|
||||
Tax effect
|
—
|
|
|
0.3
|
|
|
(5.5
|
)
|
|
(5.2
|
)
|
||||
Balance at March 31, 2017
|
$
|
(277.7
|
)
|
|
$
|
49.8
|
|
|
$
|
(285.3
|
)
|
|
$
|
(513.2
|
)
|
|
Revenues
|
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Employer Services
|
$
|
2,804.1
|
|
|
$
|
2,627.2
|
|
|
$
|
7,558.1
|
|
|
$
|
7,197.8
|
|
PEO Services
|
1,071.1
|
|
|
974.4
|
|
|
2,919.9
|
|
|
2,592.0
|
|
||||
Other
|
0.2
|
|
|
(2.1
|
)
|
|
(3.7
|
)
|
|
(8.2
|
)
|
||||
Reconciling item:
|
|
|
|
|
|
|
|
||||||||
Client fund interest
|
(182.4
|
)
|
|
(188.7
|
)
|
|
(467.1
|
)
|
|
(466.7
|
)
|
||||
|
$
|
3,693.0
|
|
|
$
|
3,410.8
|
|
|
$
|
10,007.2
|
|
|
$
|
9,314.9
|
|
|
Earnings before Income Taxes
|
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Employer Services
|
$
|
1,022.5
|
|
|
$
|
963.0
|
|
|
$
|
2,375.5
|
|
|
$
|
2,300.1
|
|
PEO Services
|
136.3
|
|
|
120.0
|
|
|
381.3
|
|
|
341.5
|
|
||||
Other
|
(123.8
|
)
|
|
(66.4
|
)
|
|
(323.2
|
)
|
|
(32.2
|
)
|
||||
Reconciling item:
|
|
|
|
|
|
|
|
|
|||||||
Client fund interest
|
(182.4
|
)
|
|
(188.7
|
)
|
|
(467.1
|
)
|
|
(466.7
|
)
|
||||
|
$
|
852.6
|
|
|
$
|
827.9
|
|
|
$
|
1,966.5
|
|
|
$
|
2,142.7
|
|
•
|
Revenue grew
7%
for the
nine months ended
March 31, 2018
|
•
|
Diluted earnings per share ("EPS") increased from
$3.25
to
$3.40
; adjusted diluted earnings per share increased from
$3.04
to
$3.43
|
•
|
Our shareholder friendly actions continued as we raised our quarterly cash dividend by 10% and returned approximately $
800 million
via dividends and approximately $
600 million
via share repurchases
|
•
|
Completed migrations of our mid-market clients to latest version of Workforce Now
|
•
|
Announcement of a voluntary early retirement program and execution of our strategic initiatives gained momentum
|
|
Three Months Ended
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
|
||||||||||||||||
|
March 31,
|
|
% Change
|
|
March 31,
|
|
% Change
|
||||||||||||||||||||
|
2018
|
|
2017
|
|
As Reported
|
|
Constant Currency Basis
(Note 1)
|
|
2018
|
|
2017
|
|
As Reported
|
|
Constant Currency Basis
(Note 1)
|
||||||||||||
Total revenues
|
$
|
3,693.0
|
|
|
$
|
3,410.8
|
|
|
8
|
%
|
|
7
|
%
|
|
$
|
10,007.2
|
|
|
$
|
9,314.9
|
|
|
7
|
%
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Costs of revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating expenses
|
1,844.7
|
|
|
1,701.5
|
|
|
8
|
%
|
|
7
|
%
|
|
5,210.6
|
|
|
4,793.4
|
|
|
9
|
%
|
|
8
|
%
|
||||
Systems development and programming costs
|
162.5
|
|
|
153.3
|
|
|
6
|
%
|
|
4
|
%
|
|
477.6
|
|
|
460.6
|
|
|
4
|
%
|
|
2
|
%
|
||||
Depreciation and amortization
|
70.2
|
|
|
56.2
|
|
|
25
|
%
|
|
23
|
%
|
|
202.1
|
|
|
168.4
|
|
|
20
|
%
|
|
19
|
%
|
||||
Total costs of revenues
|
2,077.4
|
|
|
1,911.0
|
|
|
9
|
%
|
|
7
|
%
|
|
5,890.3
|
|
|
5,422.4
|
|
|
9
|
%
|
|
8
|
%
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Selling, general and administrative costs
|
755.1
|
|
|
665.0
|
|
|
14
|
%
|
|
13
|
%
|
|
2,134.8
|
|
|
1,953.6
|
|
|
9
|
%
|
|
9
|
%
|
||||
Interest expense
|
18.6
|
|
|
16.8
|
|
|
n/m
|
|
|
n/m
|
|
|
74.1
|
|
|
57.2
|
|
|
n/m
|
|
|
n/m
|
|
||||
Total expenses
|
2,851.1
|
|
|
2,592.8
|
|
|
10
|
%
|
|
9
|
%
|
|
8,099.2
|
|
|
7,433.2
|
|
|
9
|
%
|
|
8
|
%
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other income, net
|
(10.7
|
)
|
|
(9.9
|
)
|
|
n/m
|
|
|
n/m
|
|
|
(58.5
|
)
|
|
(261.0
|
)
|
|
n/m
|
|
|
n/m
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earnings before income taxes
|
$
|
852.6
|
|
|
$
|
827.9
|
|
|
3
|
%
|
|
2
|
%
|
|
$
|
1,966.5
|
|
|
$
|
2,142.7
|
|
|
(8
|
)%
|
|
(9
|
)%
|
Margin
|
23.1
|
%
|
|
24.3
|
%
|
|
|
|
|
|
19.7
|
%
|
|
23.0
|
%
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for income taxes
|
$
|
209.5
|
|
|
$
|
240.0
|
|
|
(13
|
)%
|
|
(14
|
)%
|
|
$
|
454.4
|
|
|
$
|
675.1
|
|
|
(33
|
)%
|
|
(34
|
)%
|
Effective tax rate
|
24.6
|
%
|
|
29.0
|
%
|
|
|
|
|
|
23.1
|
%
|
|
31.5
|
%
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net earnings
|
$
|
643.1
|
|
|
$
|
587.9
|
|
|
9
|
%
|
|
8
|
%
|
|
$
|
1,512.1
|
|
|
$
|
1,467.6
|
|
|
3
|
%
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted earnings per share
|
$
|
1.45
|
|
|
$
|
1.31
|
|
|
11
|
%
|
|
9
|
%
|
|
$
|
3.40
|
|
|
$
|
3.25
|
|
|
5
|
%
|
|
4
|
%
|
|
|
Three Months Ended
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
|
||||||||||||||||
|
|
March 31,
|
|
% Change
|
|
March 31,
|
|
% Change
|
||||||||||||||||||||
|
|
2018
|
|
2017
|
|
As Reported
|
|
Constant Currency Basis
(h) |
|
2018
|
|
2017
|
|
As Reported
|
|
Constant Currency Basis
(h)
|
||||||||||||
Net earnings
|
|
$
|
643.1
|
|
|
$
|
587.9
|
|
|
9
|
%
|
|
8
|
%
|
|
$
|
1,512.1
|
|
|
$
|
1,467.6
|
|
|
3
|
%
|
|
2
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for income taxes
|
|
209.5
|
|
|
240.0
|
|
|
|
|
|
|
454.4
|
|
|
675.1
|
|
|
|
|
|
||||||||
All other interest expense (a)
|
|
14.8
|
|
|
14.6
|
|
|
|
|
|
|
44.8
|
|
|
44.6
|
|
|
|
|
|
||||||||
All other interest income (a)
|
|
(6.1
|
)
|
|
(5.2
|
)
|
|
|
|
|
|
(16.7
|
)
|
|
(14.3
|
)
|
|
|
|
|
||||||||
Gain on sale of business
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
(205.4
|
)
|
|
|
|
|
||||||||
Transformation initiatives (b)
|
|
39.7
|
|
|
0.6
|
|
|
|
|
|
|
39.7
|
|
|
41.6
|
|
|
|
|
|
||||||||
Proxy contest matters (f)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
33.2
|
|
|
—
|
|
|
|
|
|
||||||||
Adjusted EBIT
|
|
$
|
901.0
|
|
|
$
|
837.9
|
|
|
8
|
%
|
|
6
|
%
|
|
$
|
2,067.5
|
|
|
$
|
2,009.2
|
|
|
3
|
%
|
|
2
|
%
|
Adjusted EBIT Margin
|
|
24.4
|
%
|
|
24.6
|
%
|
|
|
|
|
|
20.7
|
%
|
|
21.6
|
%
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for income taxes
|
|
$
|
209.5
|
|
|
$
|
240.0
|
|
|
(13
|
)%
|
|
(14
|
)%
|
|
$
|
454.4
|
|
|
$
|
675.1
|
|
|
(33
|
)%
|
|
(34
|
)%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on sale of business (c)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
(84.0
|
)
|
|
|
|
|
||||||||
Transformation initiatives (d)
|
|
9.7
|
|
|
0.2
|
|
|
|
|
|
|
9.6
|
|
|
15.7
|
|
|
|
|
|
||||||||
Proxy contest matters (f)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
10.4
|
|
|
—
|
|
|
|
|
|
||||||||
Tax Cuts and Jobs Act (g)
|
|
(2.8
|
)
|
|
—
|
|
|
|
|
|
|
42.9
|
|
|
—
|
|
|
|
|
|
||||||||
Adjusted provision for income taxes
|
|
$
|
216.4
|
|
|
$
|
240.2
|
|
|
(10
|
)%
|
|
(11
|
)%
|
|
$
|
517.3
|
|
|
$
|
606.8
|
|
|
(15
|
)%
|
|
(16
|
)%
|
Adjusted effective tax rate (e)
|
|
24.3
|
%
|
|
29.0
|
%
|
|
|
|
|
|
25.4
|
%
|
|
30.7
|
%
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net earnings
|
|
$
|
643.1
|
|
|
$
|
587.9
|
|
|
9
|
%
|
|
8
|
%
|
|
$
|
1,512.1
|
|
|
$
|
1,467.6
|
|
|
3
|
%
|
|
2
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on sale of business
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
(205.4
|
)
|
|
|
|
|
||||||||
Provision for income taxes on gain on sale of business (c)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
84.0
|
|
|
|
|
|
||||||||
Transformation initiatives (b)
|
|
39.7
|
|
|
0.6
|
|
|
|
|
|
|
39.7
|
|
|
41.6
|
|
|
|
|
|
||||||||
Income tax benefit for transformation initiatives (d)
|
|
(9.7
|
)
|
|
(0.2
|
)
|
|
|
|
|
|
(9.6
|
)
|
|
(15.7
|
)
|
|
|
|
|
||||||||
Proxy contest matters (f)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
33.2
|
|
|
—
|
|
|
|
|
|
||||||||
Income tax benefit for proxy contest matters (f)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
(10.4
|
)
|
|
—
|
|
|
|
|
|
||||||||
Income tax benefit from Tax Cuts and Jobs Act (g)
|
|
2.8
|
|
|
—
|
|
|
|
|
|
|
(42.9
|
)
|
|
—
|
|
|
|
|
|
||||||||
Adjusted net earnings
|
|
$
|
675.9
|
|
|
$
|
588.3
|
|
|
15
|
%
|
|
13
|
%
|
|
$
|
1,522.1
|
|
|
$
|
1,372.1
|
|
|
11
|
%
|
|
10
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted EPS
|
|
$
|
1.45
|
|
|
$
|
1.31
|
|
|
11
|
%
|
|
9
|
%
|
|
$
|
3.40
|
|
|
$
|
3.25
|
|
|
5
|
%
|
|
4
|
%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on sale of business (c)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
(0.27
|
)
|
|
|
|
|
||||||||
Transformation initiatives (b) (d)
|
|
0.07
|
|
|
—
|
|
|
|
|
|
|
0.07
|
|
|
0.06
|
|
|
|
|
|
||||||||
Proxy contest matters (f)
|
|
—
|
|
|
—
|
|
|
|
|
|
|
0.05
|
|
|
—
|
|
|
|
|
|
||||||||
Tax Cuts and Jobs Act (g)
|
|
0.01
|
|
|
—
|
|
|
|
|
|
|
(0.10
|
)
|
|
—
|
|
|
|
|
|
||||||||
Adjusted diluted EPS
|
|
$
|
1.52
|
|
|
$
|
1.31
|
|
|
16
|
%
|
|
15
|
%
|
|
$
|
3.43
|
|
|
$
|
3.04
|
|
|
13
|
%
|
|
12
|
%
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||||||
|
March 31,
|
|
|
|
March 31,
|
|
|
||||||||||||||||
|
2018
|
|
2017
|
|
$ Change
|
|
2018
|
|
2017
|
|
$ Change
|
||||||||||||
Interest income on corporate funds
|
$
|
(11.0
|
)
|
|
$
|
(10.1
|
)
|
|
$
|
0.9
|
|
|
$
|
(59.4
|
)
|
|
$
|
(54.5
|
)
|
|
$
|
4.9
|
|
Realized gains on available-for-sale securities
|
(1.3
|
)
|
|
(0.6
|
)
|
|
0.7
|
|
|
(1.9
|
)
|
|
(3.1
|
)
|
|
(1.2
|
)
|
||||||
Realized losses on available-for-sale securities
|
1.6
|
|
|
0.8
|
|
|
(0.8
|
)
|
|
3.2
|
|
|
2.0
|
|
|
(1.2
|
)
|
||||||
Gain on sale of assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
0.4
|
|
||||||
Gain on sale of business (see Note 4 of the Consolidated Financial Statements)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(205.4
|
)
|
|
(205.4
|
)
|
||||||
Other income, net
|
$
|
(10.7
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
0.8
|
|
|
$
|
(58.5
|
)
|
|
$
|
(261.0
|
)
|
|
$
|
(202.5
|
)
|
|
Revenues
|
||||||||||||||||||||||||||
|
Three Months Ended
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
|
||||||||||||||||
|
March 31,
|
|
% Change
|
|
March 31,
|
|
% Change
|
||||||||||||||||||||
|
2018
|
|
2017
|
|
As
Reported
|
|
Constant Currency Basis
|
|
2018
|
|
2017
|
|
As
Reported
|
|
Constant Currency Basis
|
||||||||||||
Employer Services
|
$
|
2,804.1
|
|
|
$
|
2,627.2
|
|
|
7
|
%
|
|
5
|
%
|
|
$
|
7,558.1
|
|
|
$
|
7,197.8
|
|
|
5
|
%
|
|
4
|
%
|
PEO Services
|
1,071.1
|
|
|
974.4
|
|
|
10
|
%
|
|
10
|
%
|
|
2,919.9
|
|
|
2,592.0
|
|
|
13
|
%
|
|
13
|
%
|
||||
Other
|
0.2
|
|
|
(2.1
|
)
|
|
n/m
|
|
|
n/m
|
|
|
(3.7
|
)
|
|
(8.2
|
)
|
|
n/m
|
|
|
n/m
|
|
||||
Reconciling item:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Client fund interest
|
(182.4
|
)
|
|
(188.7
|
)
|
|
n/m
|
|
|
n/m
|
|
|
(467.1
|
)
|
|
(466.7
|
)
|
|
n/m
|
|
|
n/m
|
|
||||
|
$
|
3,693.0
|
|
|
$
|
3,410.8
|
|
|
8
|
%
|
|
7
|
%
|
|
$
|
10,007.2
|
|
|
$
|
9,314.9
|
|
|
7
|
%
|
|
6
|
%
|
|
Earnings before Income Taxes
|
||||||||||||||||||||||||||
|
Three Months Ended
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
|
||||||||||||||||
|
March 31,
|
|
% Change
|
|
March 31,
|
|
% Change
|
||||||||||||||||||||
|
2018
|
|
2017
|
|
As Reported
|
|
Constant Currency Basis
|
|
2018
|
|
2017
|
|
As
Reported |
|
Constant Currency Basis
|
||||||||||||
Employer Services
|
$
|
1,022.5
|
|
|
$
|
963.0
|
|
|
6
|
%
|
|
5
|
%
|
|
$
|
2,375.5
|
|
|
$
|
2,300.1
|
|
|
3
|
%
|
|
2
|
%
|
PEO Services
|
136.3
|
|
|
120.0
|
|
|
14
|
%
|
|
14
|
%
|
|
381.3
|
|
|
341.5
|
|
|
12
|
%
|
|
12
|
%
|
||||
Other
|
(123.8
|
)
|
|
(66.4
|
)
|
|
n/m
|
|
|
n/m
|
|
|
(323.2
|
)
|
|
(32.2
|
)
|
|
n/m
|
|
|
n/m
|
|
||||
Reconciling item:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Client fund interest
|
(182.4
|
)
|
|
(188.7
|
)
|
|
n/m
|
|
|
n/m
|
|
|
(467.1
|
)
|
|
(466.7
|
)
|
|
n/m
|
|
|
n/m
|
|
||||
|
$
|
852.6
|
|
|
$
|
827.9
|
|
|
3
|
%
|
|
2
|
%
|
|
$
|
1,966.5
|
|
|
$
|
2,142.7
|
|
|
(8
|
)%
|
|
(9
|
)%
|
|
|
Nine Months Ended
|
|
|
||||||||
|
|
March 31,
|
|
|
||||||||
|
|
2018
|
|
2017
*As Adjusted
|
|
$ Change
|
||||||
Cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
1,810.0
|
|
|
$
|
1,668.7
|
|
|
$
|
141.3
|
|
Investing activities
|
|
(1,958.0
|
)
|
|
(954.7
|
)
|
|
(1,003.3
|
)
|
|||
Financing activities
|
|
5,358.2
|
|
|
(986.5
|
)
|
|
6,344.7
|
|
|||
Effect of exchange rate changes on cash, cash equivalents, restricted cash, and restricted cash equivalents
|
|
53.1
|
|
|
(81.1
|
)
|
|
134.2
|
|
|||
Net change in cash, cash equivalents, restricted cash, and restricted cash equivalents
|
|
$
|
5,263.3
|
|
|
$
|
(353.6
|
)
|
|
$
|
5,616.9
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
March 31,
|
|
March 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Average investment balances at cost:
|
|
|
|
|
|
|
|
||||||||
Corporate investments
|
$
|
2,976.0
|
|
|
$
|
3,964.8
|
|
|
$
|
5,082.3
|
|
|
$
|
6,126.7
|
|
Funds held for clients
|
28,817.1
|
|
|
27,312.6
|
|
|
24,129.6
|
|
|
22,721.6
|
|
||||
Total
|
$
|
31,793.1
|
|
|
$
|
31,277.4
|
|
|
$
|
29,211.9
|
|
|
$
|
28,848.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Average interest rates earned exclusive of realized
(gains)/losses on:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate investments
|
1.5
|
%
|
|
1.0
|
%
|
|
1.6
|
%
|
|
1.2
|
%
|
||||
Corporate investments
|
1.9
|
%
|
|
1.6
|
%
|
|
1.9
|
%
|
|
1.7
|
%
|
||||
Total
|
1.8
|
%
|
|
1.6
|
%
|
|
1.8
|
%
|
|
1.6
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Realized gains on available-for-sale securities
|
$
|
(1.3
|
)
|
|
$
|
(0.6
|
)
|
|
$
|
(1.9
|
)
|
|
$
|
(3.1
|
)
|
Realized losses on available-for-sale securities
|
1.6
|
|
|
0.8
|
|
|
3.2
|
|
|
2.0
|
|
||||
Net realized losses/(gains) on available-for-sale securities
|
$
|
0.3
|
|
|
$
|
0.2
|
|
|
$
|
1.3
|
|
|
$
|
(1.1
|
)
|
|
March 31, 2018
|
|
June 30,
2017
|
||||
Net unrealized pre-tax (losses)/gains on available-for-sale securities
|
$
|
(296.8
|
)
|
|
$
|
102.5
|
|
|
|
|
|
||||
Total available-for-sale securities at fair value
|
$
|
22,502.7
|
|
|
$
|
21,901.1
|
|
|
|
Total Number
of Shares Purchased (1)
|
|
Average Price
Paid per Share
|
|
Total Number of
Shares Purchased
as Part of the
Publicly
Announced
Common Stock Repurchase Plan (2)
|
|
Maximum Number
of Shares that
may yet be
Purchased under
the Common Stock
Repurchase Plan (2)
|
|||||
Period
|
|
|
|
|
|||||||||
January 1 to 31, 2018
|
|
58,060
|
|
|
$
|
116.28
|
|
|
54,853
|
|
|
21,285,151
|
|
|
|
|
|
|
|
|
|
|
|||||
February 1 to 28, 2018
|
|
471,890
|
|
|
$
|
114.85
|
|
|
470,318
|
|
|
20,814,833
|
|
|
|
|
|
|
|
|
|
|
|||||
March 1 to 31, 2018
|
|
1,207,836
|
|
|
$
|
115.21
|
|
|
1,206,665
|
|
|
19,608,168
|
|
Total
|
|
1,737,786
|
|
|
|
|
1,731,836
|
|
|
|
|
Date of Approval
|
Shares
|
August 2015
|
25 million
|
Exhibit Number
|
Exhibit
|
Automatic Data Processing, Inc. amended and restated 2008 Omnibus Award Plan
|
|
Certification by Carlos A. Rodriguez pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934
|
|
Certification by Jan Siegmund pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934
|
|
Certification by Carlos A. Rodriguez pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
Certification by Jan Siegmund pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
101.INS
|
XBRL instance document
|
101.SCH
|
XBRL taxonomy extension schema document
|
101.CAL
|
XBRL taxonomy extension calculation linkbase document
|
101.LAB
|
XBRL taxonomy label linkbase document
|
101.PRE
|
XBRL taxonomy extension presentation linkbase document
|
101.DEF
|
XBRL taxonomy extension definition linkbase document
|
|
|
AUTOMATIC DATA PROCESSING, INC.
(Registrant)
|
|
|
|
Date:
|
May 4, 2018
|
/s/ Jan Siegmund
Jan Siegmund
|
|
|
|
|
|
Chief Financial Officer
(Title)
|
1.
|
Purpose.
|
2.
|
Definitions.
|
3.
|
Effective Date; Duration.
The Plan was originally effective as of the Effective Date, and was subsequently amended and restated as of April 11, 2018. The expiration date of the Plan, on and after which date no Awards may be granted hereunder, shall be the tenth anniversary of the Effective Date;
provided
,
however
, that such expiration shall not affect Awards then outstanding, and the terms and conditions of the Plan shall continue to apply to such Awards.
|
4.
|
Administration.
|
5.
|
Grant of Awards; Shares Subject to the Plan; Limitations.
|
6.
|
Eligibility.
|
7.
|
Options.
|
8.
|
Stock Appreciation Rights.
|
9.
|
Restricted Stock and Restricted Stock Units.
|
10.
|
Other Stock-Based Awards.
|
11.
|
Performance Compensation Awards.
|
12.
|
Changes in Capital Structure and Similar Events.
In the event of (a) any dividend (other than regular cash dividends) or other distribution (whether in the form of cash, shares of Common Stock, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, split-off, spin-off, combination, repurchase or exchange of shares of Common Stock or other securities of the Company, issuance of warrants or other rights to acquire shares of Common Stock or other securities of the Company, or other similar corporate transaction or event (including, without limitation, a Change in Control) that affects the shares of Common Stock, or (b) unusual or nonrecurring events (including, without limitation, a Change in Control) affecting the Company, any Affiliate, or the financial statements of the Company or any Affiliate, or changes in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange or inter-dealer quotation system, accounting principles or law, such that in either case an adjustment is determined by the Committee in its sole discretion to be necessary or appropriate, then the Committee shall make any such adjustments in such manner as it may deem equitable, including without limitation, any or all of the following:
|
13.
|
Amendments and Termination.
|
14.
|
General.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Automatic Data Processing, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
May 4, 2018
|
/s/ Carlos A. Rodriguez
|
|
|
Carlos A. Rodriguez
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Automatic Data Processing, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
May 4, 2018
|
/s/ Jan Siegmund
|
|
|
Jan Siegmund
|
|
|
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
|
Date:
|
May 4, 2018
|
/s/ Carlos A.Rodriguez
|
|
|
Carlos A. Rodriguez
|
|
|
President and Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
|
Date:
|
May 4, 2018
|
/s/ Jan Siegmund
.
|
|
|
Jan Siegmund
|
|
|
Chief Financial Officer
|