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PAYCHEX, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Carryforward Exists (a consensus of the FASB Emerging Issues Task Force).” This ASU provides explicit
guidance regarding the presentation in the statement of financial position of an unrecognized tax benefit when net
operating losses or tax credit carryforwards exist. It was effective for fiscal years, and interim periods within
those years, beginning after December 15, 2013. Adoption of this guidance did not have an effect on the
Company’s consolidated financial statements.
In January 2014, the FASB issued ASU 2014-01, “Investments — Equity Method and Joint Ventures (Topic
323): Accounting for Investments in Qualified Affordable Housing Projects (a consensus of the FASB Emerging
Issues Task Force).” This ASU permits a company to make an accounting policy election to account for
investments in qualified affordable housing projects under a new proportional amortization method. If such an
election is not made, the ASU requires use of the equity or cost method for investments. The ASU is effective for
fiscal years, and interim periods within those years, beginning after December 15, 2014, with early adoption
permitted. The Company currently accounts for its investments in qualified affordable housing projects using the
equity method for investments and the adoption of this guidance did not have any effect on the its consolidated
financial statements.
Recently issued accounting pronouncements: In May 2015, the FASB issued ASU No. 2015-09,
“Financial Services-Insurance (Topic 944): Disclosures about Short-Duration Contracts.” This guidance requires
insurance entities to disclose for annual reporting periods incurred and paid claims development information by
accident year, after reinsurance, for the number of years for which claims typically remain open. Disclosures
should also include quantitative information about claim frequency and a qualitative description of
methodologies used for determining claim frequency information. This guidance is effective for annual reporting
periods, including interim periods, beginning after December 15, 2015, and is applicable to the Company’s fiscal
year beginning June 1, 2016. Early and retrospective application is permitted. The Company is currently
evaluating this guidance, but does not anticipate it will have a material impact to its consolidated financial
statements.
In May 2015, the FASB issued ASU No. 2015-07, “Fair Value Measurement (Topic 820): Disclosures for
Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) (a consensus of the
FASB Emerging Issues Task Force).” This guidance removes the requirement to categorize within the fair value
hierarchy investments for which fair value is measured using the net asset value per share practical expedient and
removes certain related disclosure requirements. This guidance is effective for annual reporting periods,
including interim periods, beginning after December 15, 2015, and is applicable to the Company’s fiscal year
beginning June 1, 2016. Early adoption is permitted. The Company does not anticipate this guidance will have a
material impact to its consolidated financial statements.
In April 2015, the FASB issued ASU No. 2015-05, “Intangibles — Goodwill and Other — Internal-Use
Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” This
guidance clarifies the accounting treatment for fees paid in cloud computing arrangements, including the
determination of whether a cloud computing arrangement includes a software license. This guidance is effective
for annual reporting periods, including interim periods, beginning after December 15, 2015, and is applicable to
the Company’s fiscal year beginning June 1, 2016. Early adoption is permitted. The Company is currently
evaluating this guidance, but does not anticipate it will have a material impact to its consolidated financial
statements.
In April 2015, the FASB issued ASU No. 2015-03, “Interest — Imputation of Interest (Subtopic 835-30):
Simplifying the Presentation of Debt Issuance Costs.” This Guidance requires debt issuance costs to be presented
in the balance sheet as a reduction of the related debt liability rather than an asset. This guidance is effective for
annual reporting periods, including interim periods, beginning after December 15, 2015, and is applicable to the
Company’s fiscal year beginning June 1, 2016. Early adoption is permitted for financial statements not
previously issued. The Company does not anticipate this guidance will have a material impact to its consolidated
financial statements.
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