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Revenue Recognition (Notes) | 6 Months Ended
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Jun. 30, 2018
Revenue from Contract with Customer [Abstract] |
Revenue Recognition | (3) Revenue Recognition Adoption of New Accounting Guidance on Revenue Recognition As of January 1, 2018, we adopted the new accounting guidance on revenue recognition using the modified retrospective approach applied to those contracts that were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under the new guidance, while prior periods continue to be reported in accordance with previous accounting guidance. We determined that no cumulative effect adjustment to retained earnings was necessary upon adoption as there were no significant revenue recognition differences identified between the new and previous accounting guidance. Revenue Recognition We recognize revenues when control of the promised services is transferred to our clients, in an amount that reflects the consideration we expect to be entitled to receive in exchange for those services. Our revenues are recorded net of any sales, value added, or other taxes collected from our clients. A performance obligation is a promise in a contract to transfer a distinct service to the client, and it is the unit of account in the new accounting guidance for revenue recognition. The majority of our contracts have a single performance obligation as the promise to transfer the individual services is not separately identifiable from other promises in our contracts and, therefore, is not distinct. However, we have multiple performance obligations within our Recruitment Process Outsourcing (RPO) contracts as discussed below. For performance obligations that we satisfy over time, revenues are recognized by consistently applying a method of measuring progress toward satisfaction of that performance obligation. We generally utilize an input measure of time (e.g., hours, weeks, months) of service provided, which most accurately depicts the progress toward completion of each performance obligation. We generally determine standalone selling prices based on the prices included in the client contracts, using expected costs plus margin, or other observable prices. The price as specified in our client contracts is generally considered the standalone selling price as it is an observable input that depicts the price as if sold to a similar client in similar circumstances. Certain client contracts have variable consideration, including credits, sales allowances, rebates or other similar items that generally reduce the transaction price. We estimate variable consideration using whichever method, either the expected value method or most likely amount method, better predicts the amount of consideration to which we will become entitled based on the terms of the client contract and historical evidence. These amounts may be constrained and are only included in revenues to the extent we do not expect a significant reversal when the uncertainty associated with the variable consideration is resolved. Our variable consideration amounts are not material, and we do not believe that there will be significant changes to our estimates. Our client contracts generally include standard payment terms acceptable in each of the countries and territories in which we operate. The payment terms vary by the type and location of our clients and services offered. Client payments are typically due approximately 60 days after invoicing, but may be a shorter or longer term depending on the contract. Our client contracts are generally short-term in nature with a term of one year or less. The timing between satisfaction of the performance obligation, invoicing and payment is not significant. For certain services and client types, we may require payment prior to delivery of services to the client, for which deferred revenue is recorded. Principal vs. Agent In certain scenarios where a third-party vendor is involved in our revenue transactions with our clients, we evaluate whether we are the principal or the agent in the transaction. In situations where we act as principal in the transaction, we control the performance obligation prior to transfer to the client, and we report the related amounts as gross revenues and cost of services. When we act as agent in the transaction, we do not control the performance obligation prior to transfer to the client, and we report the related amounts as revenues on a net basis. A majority of these agent transactions occur within our TAPFIN - Managed Service Provider (MSP) programs where our performance obligation is to manage our client’s contingent workforce, and we earn a commission based on the amount of staffing services that are managed through the program. We are the agent in these transactions as we do not control the third-party providers' staffing services provided to the client through our MSP program prior to those services being transferred to the client. Practical Expedients and Exemptions For certain client contracts where we recognize revenues over time, we recognize the amount that we have the right to invoice, which corresponds directly to the value provided to the client of our performance to date. As allowed under the new guidance, we do not disclose the amount of unsatisfied performance obligations for client contracts with an original expected length of one year or less and those client contracts for which we recognize revenues at the amount to which we have the right to invoice for services performed. We have other contracts with revenues expected to be recognized subsequent to June 30, 2018 related to remaining performance obligations, which are not material. Revenue Service Types The following is a description of our revenue service types, including Staffing and Interim, Outcome-Based Solutions and Consulting, Permanent Recruitment and Other services. Staffing and Interim Staffing and Interim services include the augmentation of clients’ workforce with our contingent employees performing services under the client’s supervision, which provides our clients with a source of flexible labor. Staffing and Interim client contracts are generally short-term in nature and we generally enter into contracts that include only a single performance obligation. We recognize revenues over time based on a fixed amount for each hour of Staffing and Interim service provided as our clients benefit from our services as we provide them. Outcome-Based Solutions and Consulting Our Outcome-Based Solutions and Consulting services include utilizing consultants and contingent employees who are generally experts in a specific field advising the client to help find strategic solutions to specific matters or achieve a particular outcome. Our services may also include managing certain processes and functions within the client’s organization. We recognize revenues over time based on (i) our clients benefiting from our services as we are providing them, (ii) our clients controlling an asset as it is created or enhanced, or (iii) our performance not creating an asset with an alternative use and having an enforceable right to payment for the services we have provided to date. We generally utilize an input measure of time for the service provided, which most accurately depicts the progress toward completion of these performance obligations. The price as specified in our client contracts is generally considered the standalone selling price as it is an observable input which depicts the price as if sold to a similar client in similar circumstances. Permanent Recruitment Permanent Recruitment services include providing qualified candidates to our clients to hire on a permanent basis. We recognize revenues for our Permanent Recruitment services at a point in time when we place the qualified candidate, because we have determined that control of the performance obligation has transferred to the client (i.e. - service performed) as we have the right to payment for our service and the client has accepted our service of providing a qualified candidate to fill a permanent position. Revenues recognized from our Permanent Recruitment services are based upon either a fixed fee per placement or as a percentage of the candidate’s salary. Our RPO services are also included in our Permanent Recruitment revenues. RPO services include the various activities of managing a client's permanent workforce, which can include candidate assessments, screening, conducting candidate interviews, providing sourcing technology, and providing our marketing and recruiting expertise. We perform these activities to fulfill the overall obligation to provide permanent workforce management services, so they are not individually distinct and therefore we account for them as a single performance obligation. We generally utilize an input measure of time in months, but we do have a few contracts for which we use labor hours of management services provided as this more accurately depicts the progress toward completion of the performance obligation. We recognize revenues over time for each month of management services provided, as each month of management services is distinct and the client benefits from each month of management services as we provide them. We consider the RPO management services and placement services to be distinct and, therefore, separate performance obligations within our RPO contracts as (i) our clients can benefit from each service on its own, and (ii) each service is separately identifiable within the client contract. The prices as specified in our contracts will generally be broken out between management fees and placement fees, which we consider the standalone selling price of each service as they are the observable inputs which depict the prices as if they were sold to a similar client in similar circumstances. The consideration from our client contracts is allocated to each performance obligation based on the relative standalone selling price. Other Services Other services include revenues from outplacement services, MSP services, training services and franchise fees.
• | Outplacement services include assisting our clients in managing their workforce transitions and their employees in managing career changes by developing additional skills and finding new employment. We recognize revenues over time as we provide the service (i.e. - transfer control of the performance obligation) using the input measure of hours of service to measure progress toward completion of the performance obligation.
• | MSP services include overall program management of our clients’ contingent workforce and generally include various activities such as reporting and tracking, supplier selection and management and order distribution, depending on each client contract. We provide these services to fulfill the overall obligation of contingent workforce management services so the individual activities are not distinct and therefore we account for them as a single performance obligation. We recognize revenues over time for each month of MSP services provided, as each month of MSP services is distinct and the client benefits from each month of MSP services as we provide it.
• | Training services include teaching skills that relate to specific competencies in order for our client’s workforce to acquire knowledge and develop skills proficiencies. We recognize revenues over time for each hour of training service provided as our clients benefit from our services as we provide them.
• | Our franchise fees include the performance obligation of providing the right to use our intellectual property in a specifically defined exclusive territory as defined in a franchise agreement. Our franchise agreements generally state that franchise fees are calculated based on a percentage of revenues earned by the franchise operations and are payable on a monthly basis. As such, we record franchise fee revenues monthly over time calculated based on the specific fee percentage and the monthly revenues of the franchise operations.
Disaggregation of Revenues In the following table, revenue is disaggregated by service types and timing of revenue recognition, and includes a reconciliation of the disaggregated revenues by reportable segment.
|  | 3 Months Ended June 30, 2018
Service Types |  | Americas | Southern Europe | Northern Europe | APME | Right Management | Total
Staffing and Interim |  | $ | 951.4 |  | $ | 2,234.5 |  | $ | 1,234.0 |  | $ | 599.5 |  | $ | — |  | $ | 5,019.4 |
Outcome-Based Solutions and Consulting |  | 46.9 |  | 144.6 |  | 106.1 |  | 69.0 |  | 12.5 |  | 379.1 |
Permanent Recruitment |  | 30.9 |  | 38.8 |  | 45.0 |  | 52.0 |  | — |  | 166.7 |
Other |  | 23.3 |  | 16.1 |  | 8.1 |  | 4.3 |  | 39.9 |  | 91.7 |
|  | $ | 1,052.5 |  | $ | 2,434.0 |  | $ | 1,393.2 |  | $ | 724.8 |  | $ | 52.4 |  | $ | 5,656.9 |
|  | 3 Months Ended June 30, 2018
Timing of Revenue Recognition |  | Americas | Southern Europe | Northern Europe | APME | Right Management | Total
Services transferred over time |  | $ | 1,034.5 |  | $ | 2,398.6 |  | $ | 1,354.8 |  | $ | 689.5 |  | $ | 52.4 |  | $ | 5,529.8 |
Services transferred at a point in time |  | 18.0 |  | 35.4 |  | 38.4 |  | 35.3 |  | — |  | 127.1 |
|  | $ | 1,052.5 |  | $ | 2,434.0 |  | $ | 1,393.2 |  | $ | 724.8 |  | $ | 52.4 |  | $ | 5,656.9 |
|  | 6 Months Ended June 30, 2018
Service Types |  | Americas | Southern Europe | Northern Europe | APME | Right Management | Total
Staffing and Interim |  | $ | 1,882.8 |  | $ | 4,344.8 |  | $ | 2,489.2 |  | $ | 1,198.7 |  | $ | — |  | $ | 9,915.5 |
Outcome-Based Solutions and Consulting |  | 87.4 |  | 292.9 |  | 215.9 |  | 137.4 |  | 24.0 |  | 757.6 |
Permanent Recruitment |  | 58.7 |  | 77.4 |  | 89.5 |  | 101.0 |  | — |  | 326.6 |
Other |  | 46.2 |  | 30.9 |  | 16.2 |  | 7.9 |  | 78.4 |  | 179.6 |
|  | $ | 2,075.1 |  | $ | 4,746.0 |  | $ | 2,810.8 |  | $ | 1,445.0 |  | $ | 102.4 |  | $ | 11,179.3 |
|  | 6 Months Ended June 30, 2018
Timing of Revenue Recognition |  | Americas | Southern Europe | Northern Europe | APME | Right Management | Total
Services transferred over time |  | $ | 2,040.9 |  | $ | 4,675.1 |  | $ | 2,734.0 |  | $ | 1,378.4 |  | $ | 102.4 |  | $ | 10,930.8 |
Services transferred at a point in time |  | 34.2 |  | 70.9 |  | 76.8 |  | 66.6 |  | — |  | 248.5 |
|  | $ | 2,075.1 |  | $ | 4,746.0 |  | $ | 2,810.8 |  | $ | 1,445.0 |  | $ | 102.4 |  | $ | 11,179.3 |
Accounts Receivable, Contract Assets and Contract Liabilities We record accounts receivable when our right to consideration becomes unconditional. Contract assets primarily relate to our rights to consideration for services provided that they are conditional on satisfaction of future performance obligations. We record contract liabilities (deferred revenue) when payments are made or due prior to the related performance obligations being satisfied. The current portion of our contract liabilities is included in accrued liabilities in our Consolidated Balance Sheets. We do not have any material contract assets or long-term contract liabilities. Our deferred revenue was $35.1 at June 30, 2018 and $48.0 at December 31, 2017. The decrease is due to $32.2 of revenues recognized related to amounts that were included in the December 31, 2017 balance, partially offset by payments or amounts due in advance of satisfying our performance obligations in the first half of 2018.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 + Details
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