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Discontinued Operations
 12 Months Ended
Dec. 31, 2011
Discontinued Operations [Abstract]  
Discontinued Operations

Note 12. Discontinued Operations

In 2009, we sold 100% of our interest in Selective HR, which had historically comprised the HR Outsourcing segment of our operations. We sold this interest for proceeds scheduled to be received over a 10-year period based on the ability of the purchaser to retain and generate new worksite lives through our independent agency distribution channel. We have concluded that these proceeds are indirect cash flows since we have no continuing involvement with the operations of Selective HR and have no continuing cash flows other than these proceeds. We recorded after-tax charges of $0.7 million in 2011 and $3.8 million in 2010, respectively, due to our revaluation of the contingent proceeds, including assumptions regarding worksite life generation and retention. As of December 31, 2011, our estimated sales price was approximately $5.9 million, of which $2.7 million has been received to date.

 

In 2009, we recorded goodwill impairment charges of $7.9 million, after-tax, which was the result of Selective HR's estimated fair value not being sufficient to support its carrying value. In determining the impairment, we calculated the fair value of that reporting unit utilizing an income approach (i.e. expected present value of future cash flows).

 

Operating results of discontinued operations were as follows:

 

($ in thousands)

 

2009

Net revenue

$

44,508 

Pre-tax loss

 

(11,128)

After-tax loss

 

(7,086)

 

Intercompany transactions related to the discontinued operations were as follows:

 

($ in thousands)

 

2009

Net revenue

$

9,016