ADP 2010 Annual Report Download

Download and view the complete annual report

Please find the complete 2010 ADP annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 109

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10
-
K
AUTOMATIC DATA PROCESSING, INC.
(Exact name of registrant as specified in its charter)
Registrant
’
s telephone number, including area code: 973
-
974
-
5000
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the Registrant is a well
-
known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
[x]
No
[
]
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes
[
]
No
[x]
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such
reports), and (2) has been subject to the filing requirements for the past 90 days. Yes
[x]
No
[
]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S
-
T (§232.405 of this chapter) during
the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes
[x]
No
[
]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S
-
K (§229.405) is not contained herein
and will not be contained, to the best of Registrant
’
s knowledge, in definitive proxy or information statements incorporated by
[X]
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 2010
OR
[ ]
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 1
-
5397
Delaware
22
-
1467904
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
One ADP Boulevard, Roseland, New Jersey
07068
(Address of principal executive offices)
(Zip Code)
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class
which registered
Common Stock, $.10 Par Value
NASDAQ Global Select Market
(voting)
Chicago Stock Exchange

Table of contents

  • Page 1
    ...) One ADP Boulevard, Roseland, New Jersey (Address of principal executive offices) Registrant's telephone number, including area code: 973-974-5000 Securities registered pursuant to Section 12(b) of the Act: Title of each class Common Stock, $.10 Par Value (voting) Securities registered pursuant...

  • Page 2
    ... last business day of the Registrant's most recently completed second fiscal quarter was approximately $21,535,777,370. On August 20, 2010 there were 492,022,525 shares of Common Stock outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrant's Proxy Statement for its 2010 Annual...

  • Page 3
    ...on Accounting and Financial Disclosure Controls and Procedures Other Information Directors, Executive Officers and Corporate Governance Executive Compensation Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Certain Relationships and Related Transactions...

  • Page 4
    ... groups. ADP provides payroll services that include the preparation of client employee paychecks, electronic direct deposits and stored value payroll cards, along with employee pay statements, supporting journals, summaries and management reports. ADP also supplies the quarterly and annual social...

  • Page 5
    ... SIMPLE IRA) plans, deferred compensation plans and "premium only" cafeteria plans. Pre-Employment Services includes Screening and Selection Services and Applicant Management Services. Screening and Selection Services provides background checks, reference verifications and an HR help desk. Applicant...

  • Page 6
    ... of electronic-invoicing solutions; OneClick HR plc, a UK provider of human resources solutions offering HR software, training services and outsourced HR solutions; and HRinterax, Inc., an HR content and support services company focused on the small business market. In August 2010, ADP acquired...

  • Page 7
    ... Management (CRM) applications, front-end sales and marketing/advertising solutions, and an IP Telephony phone system fully-integrated into the DMS to help dealerships drive sales processes and business development initiatives. Dealer Services also provides its dealership clients computer hardware...

  • Page 8
    ... we have observed, among some clients and groups of clients, an impact on sensitivity to pricing and demand for ADP's services. Employer Services' revenues were flat in fiscal 2010. In the United States, revenues from our traditional payroll and payroll tax filing business declined 4% for the full...

  • Page 9
    ... solutions and services, and ADP's solutions and services have significant remaining life cycles. Licenses ADP is the licensee under a number of agreements for computer programs and databases. ADP's business is not dependent upon a single license or group of licenses. Third-party licenses, patents...

  • Page 10
    ... to execute Automated Clearing House and wire transfers as part of our client payroll and tax services. While we have contingency plans in place for bank failures, a systemic shut-down of the banking industry would impede our ability to process funds on behalf of our payroll and tax services clients...

  • Page 11
    ... highly skilled and motivated personnel, results from our operations may suffer. Item 1B. Unresolved Staff Comments None. Item 2. Properties ADP owns 41 of its processing/print centers, other operational offices, sales offices and its corporate headquarters complex in Roseland, New Jersey, which...

  • Page 12
    ... for the Company's common stock (symbol: ADP) is the NASDAQ Global Select Market. The following table sets forth the reported high and low sales prices of the Company's common stock reported on the NASDAQ Global Select Market and the cash dividends per share of common stock declared, during the past...

  • Page 13
    ... stock program, the Company purchased 190 shares during April 2010 at the then market value of the shares in connection with the exercise by employees of their option under such program to satisfy certain tax withholding requirements through the delivery of shares to the Company instead of cash...

  • Page 14
    ... March 30, 2007, the Company completed the spin-off of its former Brokerage Services Group business, comprised of Brokerage Services and Securities Clearing and Outsourcing Services, into an independent publicly traded company called Broadridge Financial Solutions, Inc. The cumulative returns of the...

  • Page 15
    ... weighted average shares outstanding Cash dividends declared per share Return on equity from continuing operations (Note 1) At year end: Cash, cash equivalents and marketable securities Total assets Obligation under commercial paper borrowing Long-term debt Stockholders' equity $ $ $ $ $ 1,775...

  • Page 16
    ... of HR information, payroll processing, tax and benefits administration solutions and services, including traditional and Web-based outsourcing solutions, that assist employers in the United States, Canada, Europe, South America (primarily Brazil), Australia and Asia to staff, manage, pay and retain...

  • Page 17
    ... in benefits costs and state unemployment insurance rates. Employer Services' and PEO Services' worldwide new business sales, which represent annualized recurring revenues anticipated from sales orders to new and existing clients, increased 4%, to just over $1 billion in fiscal 2010. Dealer Services...

  • Page 18
    ... to satisfy short-term funding requirements relating to client funds obligations. In addition, our AAA credit rating has helped us maintain uninterrupted access to the commercial paper market. Our financial condition and balance sheet remain solid at June 30, 2010, with cash and cash equivalents and...

  • Page 19
    ...decrease in the consolidated interest on funds held for clients resulted from the decrease in the average interest rate earned to 3.6% in fiscal 2010 as compared to 4.0% in fiscal 2009. Employer Services' revenues were flat in fiscal 2010 as compared to fiscal 2009. Total Expenses Our total expenses...

  • Page 20
    and our costs savings initiatives, which included lower compensation from reduced headcount and a reduction in travel and entertainment expenses. 17

  • Page 21
    ... below. Operating expenses increased $190.2 million, or 5%, in fiscal 2010 as compared to fiscal 2009, due to an increase in PEO Services pass-through costs that are re-billable, including costs for benefits coverage, workers' compensation coverage and state unemployment taxes for worksite employees...

  • Page 22
    ...million increase in net realized gains on available-for-sale securities. Earnings from Continuing Operations before Income Taxes Earnings from continuing operations before income taxes decreased $36.9 million, or 2%, from $1,900.1 million in fiscal 2009 to $1,863.2 million in fiscal 2010 because the...

  • Page 23
    ... for fiscal 2009, and the related diluted earnings per share from continuing operations, as adjusted, decreased $0.01, to $2.37. The decrease in net earnings from continuing operations, as adjusted, for fiscal 2010 reflects the decrease in earnings from continuing operations before income taxes. The...

  • Page 24
    ..., there was an increase in pass-through costs in our PEO business including costs associated with providing benefits coverage for worksite employees of $102.7 million and costs associated with workers' compensation and payment of state unemployment taxes for worksite employees of $16.8 million.

  • Page 25
    21

  • Page 26
    ... for benefits coverage of $621.6 million and costs for workers compensation and payment of state unemployment taxes of $133.7 million. The increase in operating expenses is also due to higher expenses in Employer Services of $64.5 million related to increased service costs for investment in client...

  • Page 27
    ...of 13.8 million shares in fiscal 2009 and 32.9 million shares in fiscal 2008. ANALYSIS OF REPORTABLE SEGMENTS Revenues (Dollars in millions) Years ended June 30, 2010 Employer Services PEO Services Dealer Services Other Reconciling items: Foreign exchange Client funds interest 59.2 (136.7) (7.3) (66...

  • Page 28
    ...COBRA and HR Benefits solutions, as well as an increase in revenues related to our Retirement Services business due to an increase in the market value of the assets under management. Pays per control, which represents the number of employees on our clients' payrolls as measured on a same-store-sales...

  • Page 29
    24

  • Page 30
    ... the number of employees on our clients' payrolls as measured on a same-store-sales basis utilizing a subset of approximately 137,000 payrolls of small to large businesses that are reflective of a broad range of U.S. geographic regions, decreased 2.5% in fiscal 2009. We credit Employer Services with...

  • Page 31
    ... in fiscal 2009 due to a 10% increase in the average number of worksite employees. The increase in the average number of worksite employees was due to new client sales. Revenues associated with benefits coverage, workers' compensation coverage and state unemployment taxes for worksite employees that...

  • Page 32
    ... new clients and growth in our key products during fiscal 2009. The growth in our key products was driven by increased users for ASP managed services, growth in our CRM applications and new network and hosted IP telephony installations. Earnings from Continuing Operations before Income Taxes Dealer...

  • Page 33
    ...-term commercial paper program and our U.S. and Canadian short-term repurchase agreements to meet short-term funding requirements related to client funds obligations. Net cash flows provided by operating activities were $1,682.1 million in fiscal 2010, as compared to $1,562.6 million in fiscal 2009...

  • Page 34
    ...also required to pay facility fees on the credit agreements. The primary uses of the credit facilities are to provide liquidity to the commercial paper program and funding for general corporate purposes, if necessary. We had no borrowings through June 30, 2010 under the credit agreements. We believe...

  • Page 35
    ... additional operating lease agreements. Purchase obligations primarily relate to purchase and maintenance agreements on our software, equipment and other assets. We made the determination that net cash payments expected to be paid within the next 12 months, related to unrecognized tax benefits of...

  • Page 36
    In the normal course of business, we also enter into contracts in which we make representations and warranties that relate to the performance of our services and products. We do not expect any material losses related to such representations and warranties. 30

  • Page 37
    ... money market securities and other cash equivalents. At June 30, 2010, approximately 79% of the available-for-sale securities categorized as U.S. Treasury and direct obligations of U.S. government agencies were invested in senior, unsecured, non-callable debt directly issued by the Federal Home Loan...

  • Page 38
    ...041.3 2010 2009 2008 Average interest rates earned exclusive of realized gains/ (losses) on: Corporate investments Funds held for clients Total 2.6% 3.6% 3.4% 3.6% 4.0% 3.9% 4.4% 4.4% 4.4% Realized gains on available-for-sale securities Realized losses on available-for-sale securities Net realized...

  • Page 39
    intercompany amounts payable were fully paid by the Canadian subsidiary to the U.S. subsidiary by February 2010. 32

  • Page 40
    ...on payroll funds, payroll tax filing funds and other Employer Services' client-related funds. We enter into agreements for a fixed fee per transaction (e.g., number of payees or number of payrolls processed). Fees associated with services are recognized in the period services are rendered and earned...

  • Page 41
    ...-based compensation expense based on the fair value of the award on the date of grant. We determine the fair value of stock options issued by using a binomial option-pricing model. The binomial option-pricing model considers a range of assumptions related to volatility, dividend yield, risk-free...

  • Page 42
    ... 30, 2010 and 2009, and the results of their operations and their cash flows for each of the three years in the period ended June 30, 2010, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the consolidated financial statement schedule...

  • Page 43
    ...1,235.7 2.22 0.15 2.37 2.19 0.15 2.34 521.5 527.2 Professional Employer Organization (" PEO") revenues are net of direct pass-through costs, primarily consisting of payroll wages and payroll taxes, of $13,318.7, $12,310.4 and $11,247.4, respectively. See notes to consolidated financial statements.

  • Page 44
    36

  • Page 45
    ..., Assets Current assets: Cash and cash equivalents Short-term marketable securities Accounts receivable, net Other current assets Assets held for sale Assets of discontinued operations Total current assets before funds held for clients Funds held for clients Total current assets Long-term marketable...

  • Page 46
    ... shares at June 30, 2010 and 2009, respectively Accumulated other comprehensive income Total stockholders' equity Total liabilities and stockholders' equity $ 11,252.0 (6,539.5) 209.5 5,478.9 26,862.2 $ 10,716.6 (6,133.9) 156.0 5,322.6 25,351.7 See notes to consolidated financial statements. 37

  • Page 47
    ... plans Tax benefits from stock compensation plans Treasury stock acquired (13.8 shares) Dividends ($1.2800 per share) - - 96.0 (105.8) 7.8 - (645.8) 219.7 (548.9) - - Balance at June 30, 2009 Net earnings Foreign currency translation adjustments Unrealized net gain on securities, net of tax...

  • Page 48
    See notes to consolidated financial statements. 38

  • Page 49
    ... restricted assets held to satisfy client funds obligations Capital expenditures Additions to intangibles Acquisitions of businesses, net of cash acquired Reclassification from cash and cash equivalents to short-term marketable securities Proceeds from the sale of property, plant and equipment Other...

  • Page 50
    ...cash and cash equivalents of discontinued operations, end of year Cash and cash equivalents of continuing operations, end of year $ (13.6) (622.0) 2,265.3 1,643.3 1,643.3 $ (39.1) 1,347.8 917.5 2,265.3 2,265.3 $ 41.3 (843.3) 1,746.1 14.7 917.5 917.5 See notes to consolidated financial statements...

  • Page 51
    ... are reported on the Statements of Consolidated Earnings and are reported net of direct pass-through costs, which are costs billed and incurred for PEO worksite employees, primarily consisting of payroll wages and payroll taxes. Benefits, workers' compensation and state unemployment tax fees for...

  • Page 52
    40

  • Page 53
    ...excess of gross receivables over the sales price of the computer systems financed. Unearned income is amortized using the effective-interest method to maintain a constant rate of return over the term of each contract. The allowance for doubtful accounts on long-term receivables is the Company's best...

  • Page 54
    .... M. Stock-Based Compensation. The Company recognizes stock-based compensation expense in net earnings based on the fair value of the award on the date of the grant. The Company determines the fair value of stock options issued using a binomial option-pricing model. The binomial option-pricing model...

  • Page 55
    ...The objectives of accounting for income taxes are to recognize the amount of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in an entity's financial statements or tax returns. The Company is...

  • Page 56
    ...15, 2010, unless the election is made to adopt ASU 2009-14 retrospectively. In either case, early adoption is permitted. The adoption of ASU 2009-14 will not have a material impact on the Company's consolidated results of operations, financial condition or cash flows. NOTE 2. OTHER INCOME, NET Other...

  • Page 57
    43

  • Page 58
    ... million on the Statements of Consolidated Earnings. Refer to Note 9 for more information related to Assets Held for Sale. The Company has an outsourcing agreement with Broadridge Financial Solutions, Inc. ("Broadridge") pursuant to which the Company provides data center outsourcing services, which...

  • Page 59
    ...operations, financial position or cash flows. NOTE 4. DIVESTITURES On March 24, 2010, the Company completed its sale of the non-core Commercial Systems business (the "Commercial business") for approximately $21.6 million in cash. The Commercial business was previously reported in the Dealer Services...

  • Page 60
    ...as of June 30, 2010. The following are the major classes of assets and liabilities related to discontinued operations as of June 30, 2009: June 30, 2009 Assets: Accounts receivable, net Other current assets Property, plant and equipment, net Intangible assets, net Total Liabilities: Accrued expenses...

  • Page 61
    ... for clients at June 30, 2010 and 2009 are as follows: June 30, 2010 Gross Amortized Cost Type of issue: Money market securities and other cash equivalents Available-for-sale securities: U.S. Treasury and direct obligations of U.S. government agencies Corporate bonds Asset-backed securities Canadian...

  • Page 62
    ...112.4 million, respectively. At June 30, 2009, asset-backed securities include senior tranches of securities with predominately prime collateral of fixed rate credit card, rate reduction, auto loan, student loan and equipment lease receivables with fair values of $808.4 million, $384.2 million, $244...

  • Page 63
    ... 2,388.5 2010 2009 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 our payroll and payroll tax filing services, which are classified as client funds obligations on...

  • Page 64
    ... from cash equivalents to short-term marketable securities. During fiscal 2009, the Company recorded an $18.3 million loss to other income, net, on the Statement of Consolidated Earnings to recognize its pro-rata share of the estimated losses of the Reserve Fund. During fiscal 2010, the...

  • Page 65
    ... Available-for-sale securities included in Level 2 are valued utilizing inputs obtained from an independent pricing service. To determine the fair value of our Level 2 investments, a variety of inputs are utilized, including benchmark yields, reported trades, non-binding broker/dealer quotes, issuer...

  • Page 66
    ...which is net of an allowance for doubtful accounts of $16.1 million and $18.0 million at June 30, 2010 and 2009, respectively, and unearned income of $9.5 million and $12.8 million at June 30, 2010 and 2009, respectively, and represents the excess of the gross receivables over the sales price of the...

  • Page 67
    ... for fiscal 2010, 2009 and 2008, respectively. NOTE 9. ASSETS HELD FOR SALE During fiscal 2009, the Company reclassified assets related to three buildings as assets held for sale on the Consolidated Balance Sheets. Such assets were previously reported in property, plant and equipment, net on the...

  • Page 68
    ...June 30, 2010 under the credit agreements. The Company's U.S. short-term funding requirements related to client funds are sometimes obtained through a short-term commercial paper program, which provides for the issuance of up to $6.0 billion in aggregate maturity value of commercial paper. In August...

  • Page 69
    The weighted average maturity of the Company's commercial paper in fiscal 2010 and 2009 was less than two days for both fiscal years. 53

  • Page 70
    ... by government and government agency securities. These agreements generally have terms ranging from overnight to up to five business days. The Company has $2 billion available to it on a committed basis under these reverse repurchase agreements. At June 30, 2010 and 2009, there were no outstanding...

  • Page 71
    54

  • Page 72
    ...were no derivative financial instruments outstanding at June 30, 2010, 2009 or 2008. NOTE 14. EMPLOYEE BENEFIT PLANS A. Stock Plans. The Company recognizes stock-based compensation expense in net earnings based on the fair value of the award on the date of grant. Stock-based compensation consists of...

  • Page 73
    ... under the Company's employee stock purchase plan and restricted stock awards. Stock-based compensation expense of $67.6 million, $96.0 million and $123.6 million was recognized in earnings from continuing operations in fiscal 2010, 2009 and 2008, respectively, as well as related tax benefits of $22...

  • Page 74
    ... fair values of stock plan issuances were as follows (in dollars): Years ended June 30, Stock options Stock purchase plan Performance-based restricted stock $ $ $ 2010 7.05 41.95 $ $ $ 2009 7.54 39.04 $ $ $ 2008 8.31 11.99 44.61 B. Pension Plans. The Company has a defined benefit cash balance...

  • Page 75
    ... plans funded status as of June 30, 2010 and 2009 is as follows: June 30, Change in plan assets: Fair value of plan assets at beginning of year Actual return on plan assets Employer contributions Benefits paid $ 787.0 117.6 112.3 (35.2) $ 952.2 (144.3) 6.3 (27.2) 2010 2009 Fair value of plan assets...

  • Page 76
    ... present value of benefit obligations were: Years ended June 30, Discount rate Increase in compensation levels Assumptions used to determine the net pension expense generally were: 2010 5.25% 5.50% 2009 6.80% 5.50% Years ended June 30, Discount rate Expected long-term rate of return on assets...

  • Page 77
    ... pricing service, which are reviewed by the Company for reasonableness. To determine the fair value of our Level 2 plan assets, a variety of inputs are utilized, including benchmark yields, reported trades, non-binding broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities...

  • Page 78
    ... location to which such earnings are attributable. Years ended June 30, Earnings (loss) from continuing operations before income taxes: United States Foreign $ 1,638.0 225.2 $ 1,908.6 (8.5) $ 1,618.6 184.8 2010 2009 2008 $ 1,863.2 $ 1,900.1 $ 1,803.4 The provision (benefit) for income taxes...

  • Page 79
    ...Deferred tax assets: Accrued expenses not currently deductible Stock-based compensation expense Accrued retirement benefits Net operating losses Other $ 227.4 100.9 80.8 3.0 $ 270.6 123.1 41.7 53.0 6.1 2010 2009 412.1 Less: valuation allowances (61.9) 494.5 (51.7) Deferred tax assets, net $ 350...

  • Page 80
    other assets on the Consolidated Balance Sheets at June 30, 2010 and 2009, respectively. There are $48.1 million and $23.0 million of current deferred tax liabilities included in accrued expenses and other current liabilities on the Consolidated Balance Sheets at June 30, 2010 and 2009, respectively...

  • Page 81
    ... tax assets, which were recorded in purchase accounting as a reduction to goodwill. A portion of the valuation allowance in the amount of $4.3 million at June 30, 2010 relates to net deferred tax assets, which were recorded to our provision for income taxes on the Statements of Consolidated Earnings...

  • Page 82
    ...business operations, such as California, Illinois, Minnesota and New Jersey. The tax years currently under examination vary by jurisdiction. Such examinations currently in progress are as follows: Taxing Jurisdiction U.S. (IRS) California Illinois Minnesota Fiscal Years under Examination 2009 - 2010...

  • Page 83
    New Jersey Province of Alberta 64 2002 - 2006 2007

  • Page 84
    ... tax benefits of $7.9 million and a related deferred tax asset of $2.9 million. During fiscal 2008, the Company recorded a tax-basis adjustment to capital in excess of par value on the Statements of Consolidated Stockholders' Equity, which was related to a business that the Company acquired...

  • Page 85
    ...to fixed rentals, certain leases require payment of maintenance and real estate taxes and contain escalation provisions based on future adjustments in price indices. As of June 30, 2010, the Company has purchase commitments of approximately $710.0 million relating to software and equipment purchases...

  • Page 86
    ...Reportable segments' assets include funds held for clients, but exclude corporate cash, corporate marketable securities and goodwill. Reconciling Items Client Employer Services Year ended June 30, 2010 Revenues from continuing operations Earnings from continuing operations before income taxes Assets...

  • Page 87
    ... ended June 30, 2010 Revenues from continuing operations Assets from continuing operations $ $ 7,195.0 22,401.1 $ $ 1,089.8 1,576.8 $ $ 383.4 2,558.5 $ $ 259.5 325.8 $ $ 8,927.7 26,862.2 Europe Canada Other Total Year ended June 30, 2009 Revenues from continuing operations Assets from continuing...

  • Page 88
    ... 30, 2010, the Company acquired three businesses for approximately $500 million. The Company is currently evaluating the opening balance sheets for these businesses. These acquisitions are not expected to be material, either individually or in the aggregate, to the Company's operations, financial...

  • Page 89
    ... management and board of directors regarding the preparation of reliable financial statements for external purposes in accordance with generally accepted accounting principles. ADP's internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance...

  • Page 90
    ... Butler President and Chief Executive Officer /s/ Christopher R. Reidy Christopher R. Reidy Chief Financial Officer Roseland, New Jersey August 25, 2010 Changes in Internal Control over Financial Reporting There were no changes in ADP's internal control over financial reporting that occurred during...

  • Page 91
    ... with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of...

  • Page 92
    ...Financial Officer President, Employer Services- National Account Services and Employer Services-International Corporate Controller and Principal Accounting Officer President, Added Value Services and Chief Strategy Officer Messrs. Anenen and Butler have each been employed by ADP in senior executive...

  • Page 93
    ... Business Services, Employer Services, from 2006 to 2007, and as Chief Financial Officer, Employer Services, from 2004 to 2005. Jan Siegmund joined ADP in 1999. Prior to his promotion to President, Added Value Services and Chief Strategy Officer in 2009, he served as President, Added Value Services...

  • Page 94
    ...11. Executive Compensation See "Compensation of Executive Officers" and "Election of Directors - Compensation of Non-Employee Directors" in the Proxy Statement for the Company's 2010 Annual Meeting of Stockholders, which information is incorporated herein by reference. Item 12. Security Ownership of...

  • Page 95
    ... ended June 30, 2010, 2009 and 2008 Statements of Consolidated Cash Flows - years ended June 30, 2010, 2009 and 2008 Notes to Consolidated Financial Statements 2. Financial Statement Schedules Page in Form 10-K Schedule II - Valuation and Qualifying Accounts 80 All other Schedules have been omitted...

  • Page 96
    ...Exhibit 4.4 to Registration Statement No. 333-147377 on Form S8 filed with the Commission on November 14, 2007 (Management Compensatory Plan) - Amended and Restated Employees' Savings-Stock Purchase Plan - incorporated by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the...

  • Page 97
    ... USA, Inc., Deutsche Bank Securities Inc., Intesa SanPaolo S.p.A, and Morgan Stanley MUFG Loan Partners, LLC, as Documentation Agents- incorporated by reference to Exhibit 10.16 to the Company's Current Report on Form 8-K dated June 25, 2010 - 2000 Stock Option Grant Agreement (Form for Employees...

  • Page 98
    .... dated June 25, 2010 (Management Contract) - 2008 Omnibus Award Plan - incorporated by reference to Appendix A to the Company's Proxy Statement for its 2008 Annual Meeting of Stockholders filed with the Commission on September 26, 2008 (Management Compensatory Plan) - Form of Restricted Stock Award...

  • Page 99
    ...- XBRL taxonomy extension calculation linkbase document - XBRL taxonomy label linkbase document - XBRL taxonomy extension presentation linkbase document - XBRL taxonomy extension definition linkbase document As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for...

  • Page 100
    ... 2010: Allowance for doubtful accounts: Current Long-term Deferred tax valuation allowance Year ended June 30, 2009: Allowance for doubtful accounts: Current Long-term Deferred tax valuation allowance Year ended June 30, 2008: Allowance for doubtful accounts: Current Long-term Deferred tax valuation...

  • Page 101
    ... (Gary C. Butler) Title President and Chief Executive Officer, Director (Principal Executive Officer) Chief Financial Officer (Principal Financial Officer) Corporate Controller (Principal Accounting Officer) Director Date August 25, 2010 /s/ Christopher R. Reidy (Christopher R. Reidy) /s/ Alan...

  • Page 102
    (Gregory L. Summe) 81

  • Page 103
    ... ADP Commercial Leasing, LLC ADP Dealer Services Denmark ApS ADP Dealer Services Deutschland GmbH ADP Dealer Services France SAS ADP Dealer Services Italia s.r.l. ADP Dealer Services UK Limited ADP Employer Services GmbH ADP Europe SARL ADP Europe S.A. ADP France SAS ADP GlobalView B.V. ADP Group UK...

  • Page 104
    unnamed subsidiaries, considered in the aggregate as a single subsidiary, would not have constituted a significant subsidiary as of June 30, 2010.

  • Page 105
    ..., 333-10277, 333-110393, 333146565, 333-147377, and 333-155382 on Form S-8 of our report dated August 25, 2010, relating to the consolidated financial statements and consolidated financial statement schedule of Automatic Data Processing, Inc. and subsidiaries (the "Company"), and the effectiveness...

  • Page 106
    ... 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: August 25, 2010 /s/ Gary C. Butler Gary C. Butler President and Chief Executive Officer

  • Page 107
    ...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: August 25, 2010 /s/ Christopher R. Reidy Christopher R. Reidy Chief Financial Officer

  • Page 108
    ... 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 results of operations of the Company. /s/ Gary C. Butler Gary C. Butler President and Chief Executive Officer Date: August 25, 2010

  • Page 109
    ... connection with the Annual Report of Automatic Data Processing, Inc. (the "Company") on Form 10-K for the fiscal year ending June 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Christopher R. Reidy, Chief Financial Officer of the Company, certify...