v2.3.0.15
Discontinued Operations and Divestitures
9 Months Ended
Sep. 30, 2011
Discontinued Operations and Divestitures [Abstract] 
Discontinued Operations and Divestitures
13. Discontinued Operations and Divestitures

CBIZ will divest (through sale or closure) business operations that do not contribute to the Company’s long-term objectives for growth, or that are not complementary to its target service offerings and markets. Divestitures are classified as discontinued operations provided they meet the criteria as provided in FASB ASC 205 “Presentation of Financial Statements – Discontinued Operations – Other Presentation Matters”.

Discontinued Operations

Gains or losses from the sale of discontinued operations are recorded as “(Loss) Gain on disposal of discontinued operations, net of tax”, in the accompanying consolidated statements of operations. Additionally, proceeds that are contingent upon a divested operation’s actual future performance are recorded as gain on sale of discontinued operations in the period they are earned. During the nine months ended September 30, 2011, CBIZ sold a business from the Financial Services practice group and will receive contingent proceeds from this sale transaction based on revenue over the next three-year period. As part of the sale of this business, CBIZ reduced its goodwill balance by approximately $0.3 million.

During the nine months ended September 30, 2010, CBIZ sold two businesses and closed one business from the National Practices group. Proceeds from the sales consisted of $0.2 million in cash and resulted in a pre-tax loss of approximately $0.7 million, and the office closure resulted in a pre-tax loss of approximately $1.1 million.

 

Revenue and results from operations of discontinued operations for the three and nine months ended September 30, 2011 and 2010 are separately reported as “Loss from discontinued operations, net of tax” in the consolidated statements of operations and were as follows (in thousands):

 

                                 
    THREE MONTHS ENDED
SEPTEMBER 30,		     NINE MONTHSENDED
SEPTEMBER 30,		  
    2011     2010     2011     2010  

Revenue

   $ 1     $ 602     $ 959     $ 4,946  
   

 

 

    

 

 

    

 

 

    

 

 

  

Loss from discontinued operations,before income tax

   $ (75 )    $ (1,213 )    $ (1,032 )    $ (3,565 ) 

Income tax benefit

     29       466       392       1,391  
   

 

 

    

 

 

    

 

 

    

 

 

  

Loss from discontinued operations, net of tax

   $ (46 )    $ (747 )    $ (640 )    $ (2,174 ) 
   

 

 

    

 

 

    

 

 

    

 

 

  

(Loss) gain on the disposal of discontinued operations for the three and nine months ended September 30, 2011 and 2010 were as follows (in thousands):

 

                                 
    THREE MONTHS ENDED
SEPTEMBER 30,		     NINE MONTHS ENDED
SEPTEMBER 30,		  
    2011     2010     2011     2010  

Gain (loss) on disposal of discontinued

operations, before income tax

   $ 58     $ 62     $ 175     $ (1,821 ) 

Income tax (expense) benefit

     (134 )      (25 )      (181 )      826  
   

 

 

    

 

 

    

 

 

    

 

 

  

(Loss) gain on disposal of discontinued

operations, net of tax

   $ (76 )    $ 37     $ (6 )    $ (995 ) 
   

 

 

    

 

 

    

 

 

    

 

 

  

At September 30, 2011 and December 31, 2010, the assets and liabilities of businesses classified as discontinued operations are reported separately in the accompanying consolidated financial statements and consisted of the following (in thousands):

 

                 
    September 30,
2011		     December 31,
2010		  

Assets:

                

Accounts receivable, net

   $ 90     $ 381  

Other assets

     536       259  
   

 

 

    

 

 

  

Assets of discontinued operations

   $ 626     $ 640  
   

 

 

    

 

 

  

Liabilities:

                

Accounts payable

   $ —       $ 90  

Accrued personnel costs

     8       228  

Other current liabilities

     259       244  
   

 

 

    

 

 

  

Liabilities of discontinued operations

   $ 267     $ 562  
   

 

 

    

 

 

  

Divestitures

Gains and losses from divested operations and assets that do not qualify for treatment as discontinued operations are recorded as “Gain on sale of operations, net” in the consolidated statements of operations. During the nine months ended September 30, 2011, CBIZ recognized a gain of $2.3 million from the sale of its individual wealth management business and gains of $0.5 million for the sales of client lists. Cash proceeds from the sale of the business and client lists totaled approximately $7.3 million, of which approximately $6.7 million was received on December 31, 2010. As part of the sale of the individual wealth management business, CBIZ reduced its goodwill balance by approximately $2.2 million. During the nine months ended September 30, 2010, CBIZ recognized a gain of $0.4 million from the sale of a client list and received cash from this sale of $0.4 million.