Company: ADP
Filing Date: 2025-01-30
Form Type: 10-Q
Source: 0000008670-25-000007
Chunk: 33

Company: AUTOMATIC DATA PROCESSING INC
Filing Date: 2025-01-30
Form: 10-Q
Item: Part I, Item 1
Chunk 33
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 will end when the information becomes available but will not exceed twelve months from the date of acquisition.The acquisition was accounted for using the acquisition method of accounting. The Company recognized assets acquired and liabilities assumed at their fair value as of the date of acquisition, with the excess recorded to goodwill. The preliminary purchase price allocation for WorkForce Software is as follows:

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Cash$12.5 Accounts receivable, net of allowance for doubtful accounts20.0 Identifiable intangible assets (1)417.0 Goodwill846.4 All other assets21.9 Total assets acquired$1,317.8 Deferred revenue$39.6 Deferred income taxes46.6 All other liabilities58.5 Total liabilities assumed$144.7 Total net assets acquired$1,173.1 (1)  Intangible assets are recorded at estimated fair value, as determined by management based on available information which includes an estimated valuation by an independent third-party. The fair values assigned to identifiable intangible assets were determined through the use of the income approach, specifically the relief from royalty and the multi-period excess earnings methods. The major assumptions used in arriving at the estimated identifiable intangible asset values included management’s estimates of future cash flows, discounted at an appropriate rate of return which are based on the weighted average cost of capital for both the Company and other market participants, projected customer attrition rates, as well as applicable royalty rates for comparable assets. The useful lives for intangible assets were determined based upon the remaining useful economic lives of the intangible assets that are expected to contribute directly or indirectly to the future cash flows. The estimated fair value of intangible assets and related useful lives as included in the estimated purchase price allocation include:Estimated Fair ValueEstimated Useful Life (in years)Technology$200.0 7Customer/Partner relationships$210.0 8Tradename$7.0 4The goodwill recorded as a result of the WorkForce Software transaction represents future economic benefits the Company expects to achieve as a result of the acquisition, including expected synergies along with the value of the assembled workforce. None of the goodwill resulting from the acquisition is tax deductible.

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Note 5.  Earnings per Share (“EPS”)BasicEffect of Employee Stock Option SharesEffect ofEmployeeRestrictedStockSharesDilutedThree Months Ended December 31, 2024    Net earnings$963.2   $963.2 Weighted average shares