Description of Business and Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

Effects on the cash flow statement due to adoption of ASU 2016-18 and effects due to reclassifications are summarized below:



	Year ended December 31,
	2017											2016
(in millions)	As previously reported			Effect of ASU adoption		Reclassified amounts			As revised			As previously reported			Effect of ASU adoption		Reclassified amounts			As revised
Operating activities
Changes in operating assets and liabilities:
Accounts receivable	$	—		$	—	$	(14	)	$	(14	)	$	—		$	—	$	—		$	—
Restricted cash, cash equivalents, and investments	(46		)	46		—			—			(42		)	42		—			—
Unbilled revenue	—			—		(4		)	(4		)	—			—		(79		)	(79		)
Prepaid income taxes	37			—		(37		)	—			(38		)	—		38			—
Prepaid expenses	1			—		27			28			(2		)	—		(43		)	(45		)
Workers' compensation collateral receivable	(7		)	—		7			—			(3		)	—		3			—
Accounts payable	22			—		1			23			9			—		2			11
Client deposits	—			—		(4		)	(4		)	—			—		(2		)	(2		)
Accrued wages	11			—		15			26			4			—		69			73
Accrued health insurance costs	—			—		22			22			—			—		16			16
Accrued workers' compensation costs	12			—		(3		)	9			55			—		5			60
Payroll taxes payable and other payroll withholdings	—			—		294			294			—			—		(175		)	(175		)
Worksite employee related assets	(343		)	307		36			—			92			1		(93		)	—
Worksite employee related liabilities	342			—		(342		)	—			(94		)	—		94			—
Other assets	4			—		(15		)	(11		)	—			—		174			174
Other liabilities	—			—		17			17			—			—		(9		)	(9		)
Net cash provided by operating activities	253			353		—			606			149			43		—			192
Financing activities
Proceeds from issuance of common stock on exercised options	11			—		(11		)	—			5			—		(5		)	—
Proceeds from issuance of common stock on employee stock purchase plan	5			—		(5		)	—			4			—		(4		)	—
Proceeds from issuance of common stock	—			—		16			16			—			—		9			9
Net increase in cash and cash equivalents	$	152		$	353	$	—		$	505		$	18		$	43	$	—		$	61

Balance sheet reclassifications are summarized in the tables below:



	December 31, 2017
	As previously		Reclassification			As
(in millions)	Reported		Amounts			Revised
Assets
Restricted cash, cash equivalents, and investments	$	15	$	1,265		$	1,280
Accounts receivable, net	—		21			21
Unbilled revenue, net	—		297			297
Prepaid income taxes	5		(5		)	—
Prepaid expenses	8		30			38
Other current assets	2		17			19
Worksite employee related assets	1,625		(1,625		)	—
Workers' compensation collateral receivable	39		(39		)	—
Deferred and other long term income taxes	2		(2		)	—
Other assets	14		41			55



	December 31, 2017
	As previously		Reclassification			As
(in millions)	Reported		Amounts			Revised
Liabilities and stockholders' equity
Accounts payable & other current liabilities	$	45	$	14		$	59
Accrued wages	40		289			329
Client deposits	—		52			52
Accrued health insurance costs, net	—		151			151
Accrued workers' compensation costs, net	—		67			67
Payroll tax liabilities and other payroll withholdings	—		1,034			1,034
Insurance premiums and other payables	—		25			25
Other current liabilities	14		(14		)	—
Worksite employee related liabilities	1,618		(1,618		)	—

The below table summarizes the amounts capitalized and amortized during the year ended December 31, 2018:

The impact from the adoption of ASC Topic 606 to our consolidated income statements and balance sheets is as follows:



	December 31, 2018
(in millions)	As reported			Balance Using Previous Standard			Increase (Decrease)
Balance sheet
Assets
Cash and cash equivalents	$	228		$	235		$	(7	)
Restricted cash, cash equivalents and investments, current	942			935			7
Unbilled revenue, net	304			311			(7		)
Prepaid expenses	48			44			4
Other current assets	59			49			10
Other assets	78			67			11
Liabilities
Accounts payable and other current liabilities	$	45		$	48		$	3
Deferred taxes	68			67			$	(1	)
Other non-current liabilities	18			22			$	4
Equity
Accumulated deficit	$	(266	)	$	(290	)	$	(24	)



	Year Ended December 31, 2018
(in millions, except per share data)	As Reported		Balance Using Previous Standard		Increase (Decrease)
Income statement
Revenue
Professional service revenues	$	487	$	485	$	2
Total revenues	3,503		3,501		2
Expense
Sales and marketing expense
Commissions expense	22		53		(31		)
Total expense	3,252		3,283		(31		)
Income before provision for income taxes	241		208		33
Income tax expense	49		40		9
Net income	$	192	$	168	$	24
Basic earnings per share	$	2.72	$	2.40	$	0.32
Diluted earnings per share	$	2.65	$	2.34	$	0.31

On the date of adoption, the consolidated balance sheet will be adjusted by the following amounts:



(in millions)	Increase Under New Guidance
Recognizing right-of-use asset
Long-term right-of-use assets	$	53
Recognizing lease liability and derecognizing deferred rent
Accounts payable and other current liabilities	$	16
Other non-current liabilities	37