Paychex 2016 Annual Report Download - page 25

Competition in the payroll processing and human resource services industry is primarily based on service
responsiveness, product quality and reputation, including ease of use and accessibility of technology, breadth of
service and product offerings, and price. We believe we are competitive in each of these areas. We believe that
our excellent customer service, together with our leading-edge technology and mobility applications,
distinguishes us from our competitors.
Software Maintenance and Development
The ever-changing mandates of Federal, state, and local tax and regulatory agencies require us to regularly
update our proprietary software to provide payroll and human resource services to our clients. We are continually
engaged in developing enhancements to and the maintenance of our various software platforms to meet the
changing requirements of our clients and the marketplace. We continue to enhance our SaaS solutions and
mobility applications to offer our users an integrated and unified experience. Continued enhancement of the
client and client employee experience is important to our future success.
Employees
As of May 31, 2016, we employed approximately 13,500 people. None of our employees were covered by
collective bargaining agreements.
Intellectual Property
We own or license and use a number of trademarks, trade names, copyrights, service marks, trade secrets,
computer programs and software, and other intellectual property rights. Taken as a whole, our intellectual
property rights are material to the conduct of our business. Where it is determined to be appropriate, we take
measures to protect our intellectual property rights, including, but not limited to, confidentiality/non-disclosure
agreements or policies with employees, vendors, and others; license agreements with licensees and licensors of
intellectual property; and registration of certain trademarks. We believe that the “Paychex” name, trademark, and
logo are of material importance to us.
Seasonality
There is no significant seasonality to our business. However, during our third fiscal quarter, which ends in
February, the number of new payroll clients, new retirement services clients, and new Paychex HR Services
worksite employees tends to be higher than during the rest of the fiscal year, primarily because many new clients
prefer to start using our services at the beginning of a calendar year. In addition, calendar year-end transaction
processing and client funds activity are traditionally higher during our third fiscal quarter due to clients paying
year-end bonuses and requesting additional year-end services. Historically, as a result of these factors, our total
revenue has been slightly higher in our third fiscal quarter, with greater sales commission expenses also reported
in that quarter.
Available Information
We are subject to the informational and reporting requirements of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”). Therefore, we file periodic reports, proxy statements, and other information with
the SEC. Such reports may be read and copied at the SEC’s Public Reference Room at 100 F Street NE,
Washington, D.C. 20549. Information regarding the operation of the Public Reference Room may be obtained by
calling the SEC at (800) SEC-0330. The SEC also maintains a website (www.sec.gov) that includes our reports,
proxy statements, and other information.
Our corporate website, www.paychex.com, provides materials for investors and information about our
services. Our Form 10-Ks, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other SEC
filings, as well as any amendments to such reports and filings, are made available, free of charge, on our website
as soon as reasonably practicable after such reports have been filed with or furnished to the SEC. Also, copies of
our Annual Report to Stockholders and Proxy Statement, to be issued in connection with our 2016 Annual
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