Paychex 2016 Annual Report Download - page 73

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PAYCHEX, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note H — Property and Equipment, Net of Accumulated Depreciation
The components of property and equipment, at cost, consisted of the following:
May 31,
In millions 2016 2015
Land and improvements .............................................. $ 8.3 $ 8.3
Buildings and improvements .......................................... 103.0 102.1
Data processing equipment ........................................... 196.1 190.9
Software .......................................................... 447.5 391.8
Furniture, fixtures, and equipment ...................................... 125.0 145.6
Leasehold improvements ............................................. 108.2 106.2
Construction in progress .............................................. 24.1 28.5
Total property and equipment, gross .................................. 1,012.2 973.4
Less: Accumulated depreciation ....................................... 659.2 619.5
Property and equipment, net of accumulated depreciation ................ $ 353.0 $353.9
Depreciation expense was $99.2 million, $92.1 million, and $89.1 million for fiscal years 2016, 2015, and
2014, respectively.
Note I — Goodwill and Intangible Assets, Net of Accumulated Amortization
The Company had goodwill balances on its Consolidated Balance Sheets of $657.1 million as of May 31,
2016, and $561.5 million as of May 31, 2015. The increase of $95.6 million in goodwill since May 31, 2015 was
the result of the acquisition of substantially all of the net assets of Advance Partners by a wholly owned
subsidiary of the Company in December 2015.
The Company has certain intangible assets with finite lives. The components of intangible assets, at cost,
consisted of the following:
May 31,
In millions 2016 2015
Client lists .......................................................... $289.2 $244.6
Other intangible assets ................................................ 5.4 3.2
Total intangible assets, gross .......................................... 294.6 247.8
Less: Accumulated amortization ......................................... 225.1 215.4
Intangible assets, net of accumulated amortization ........................ $ 69.5 $ 32.4
During fiscal 2016, the Company acquired intangible assets with weighted-average amortization periods as
follows: customer lists — 9.7 years; other intangible assets — 5.0 years; and total — 9.5 years. Amortization
expense relating to intangible assets was $15.9 million, $14.5 million, and $15.9 million for fiscal years 2016,
2015, and 2014, respectively.
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