Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 23, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | TRINET GROUP INC | ||
Trading Symbol | TNET | ||
Entity Central Index Key | 937,098 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 68,268,207 | ||
Entity Public Float | $ 865,320,029 | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 184,004 | $ 166,178 |
Restricted cash and cash equivalents | 14,569 | 14,557 |
Prepaid income taxes | 42,381 | 4,105 |
Prepaid expenses | 10,784 | 8,579 |
Other current assets | 2,145 | 1,359 |
Worksite employee related assets | 1,281,471 | 1,373,386 |
Total current assets | 1,535,354 | 1,568,164 |
Workers' compensation collateral receivable | 31,883 | 29,204 |
Restricted cash, cash equivalents and investments | 130,501 | 101,806 |
Property and equipment, net | 58,622 | 37,844 |
Goodwill | 289,207 | 289,207 |
Other intangible assets, net | 31,074 | 46,772 |
Other assets | 18,502 | 19,452 |
Total assets | 2,095,143 | 2,092,449 |
Current liabilities: | ||
Accounts payable | 22,541 | 12,904 |
Accrued corporate wages | 30,937 | 28,963 |
Notes and capital leases payable, net | 36,559 | 32,970 |
Other current liabilities | 12,551 | 11,402 |
Worksite employee related liabilities | 1,275,995 | 1,369,497 |
Total current liabilities | 1,378,583 | 1,455,736 |
Notes and capital leases payables, net, noncurrent | 422,495 | 460,965 |
Workers' compensation loss reserves (net of collateral paid $22,377 and $15,129 at December 31, 2016 and 2015, respectively) | 159,301 | 105,481 |
Deferred income taxes | 92,373 | 54,641 |
Other liabilities | 7,801 | 7,545 |
Total liabilities | 2,060,553 | 2,084,368 |
Commitments and contingencies (see Note 13) | ||
Stockholders’ equity: | ||
Preferred stock ($0.000025 par value per share; 20,000,000 shares authorized; no shares issued and outstanding at December 31, 2016 and 2015) | 0 | 0 |
Common stock and additional paid-in capital ($0.000025 par value per share; 750,000,000 shares authorized; 69,015,690 and 70,371,425 shares issued and outstanding at December 31, 2016 and 2015, respectively) | 535,132 | 494,397 |
Accumulated deficit | (499,938) | (485,595) |
Accumulated other comprehensive loss | (604) | (721) |
Total stockholders’ equity | 34,590 | 8,081 |
Total liabilities and stockholders’ equity | $ 2,095,143 | $ 2,092,449 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock, per share stated value | $ 0.000025 | $ 0.000025 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, per share stated value | $ 0.000025 | $ 0.000025 |
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock, shares issued | 69,015,690 | 70,371,425 |
Common stock, shares outstanding | 69,015,690 | 70,371,425 |
Collateral paid to insurance carriers, net of workers' compensation loss reserves, noncurrent | $ 22,377 | $ 15,129 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
Professional service revenues | $ 446,755 | $ 401,287 | $ 342,074 |
Insurance service revenues | 2,613,558 | 2,258,001 | 1,851,457 |
Total revenues | 3,060,313 | 2,659,288 | 2,193,531 |
Insurance costs | 2,413,752 | 2,112,376 | 1,686,315 |
Cost of providing services (exclusive of depreciation and amortization of intangible assets) | 190,444 | 150,694 | 134,256 |
Sales and marketing | 173,714 | 166,759 | 139,997 |
General and administrative | 91,659 | 69,626 | 53,926 |
Systems development and programming | 31,438 | 27,558 | 26,101 |
Amortization of intangible assets | 15,997 | 39,346 | 52,302 |
Depreciation | 19,351 | 14,612 | 13,843 |
Total costs and operating expenses | 2,936,355 | 2,580,971 | 2,106,740 |
Operating income | 123,958 | 78,317 | 86,791 |
Other income (expense): | |||
Interest expense and bank fees | (20,257) | (19,449) | (54,193) |
Other, net | 751 | 1,142 | 478 |
Income before provision for income taxes | 104,452 | 60,010 | 33,076 |
Income tax expenses | 43,046 | 28,315 | 17,579 |
Net income | $ 61,406 | $ 31,695 | $ 15,497 |
Net income per share: | |||
Basic EPS (in dollars per share) | $ 0.88 | $ 0.45 | $ 0.24 |
Diluted EPS (in dollars per share) | $ 0.85 | $ 0.44 | $ 0.22 |
Weighted average shares: | |||
Basic (in shares) | 70,159,696 | 70,228,159 | 56,160,539 |
Diluted (in shares) | 71,972,486 | 72,618,069 | 59,566,773 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 61,406 | $ 31,695 | $ 15,497 |
Other comprehensive income (loss), net of tax | |||
Unrealized gains (losses) on investments | 47 | (86) | (8) |
Foreign currency translation adjustments | 70 | (321) | (115) |
Total other comprehensive income (loss), net of tax | 117 | (407) | (123) |
Comprehensive income | $ 61,523 | $ 31,288 | $ 15,374 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQIUTY (DEFICIT) - USD ($) | Total | Series G and H Preferred Stock | Common Stock | Common Stock Including Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Balance at Dec. 31, 2013 | $ (393,240,000) | $ 122,878,000 | $ 74,160,000 | $ (467,209,000) | $ (191,000) | |
Balance, shares at Dec. 31, 2013 | 9,516,427 | 15,259,540 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 15,497,000 | 15,497,000 | ||||
Other comprehensive income (loss) | (123,000) | (123,000) | ||||
Issuance of common stock from vested restricted stock units, (in shares) | 4,250 | |||||
Issuance of common stock for employee stock purchase plan | $ 3,393,000 | 3,393,000 | ||||
Issuance of common stock for employee stock purchase plan (in shares) | 249,494 | 249,494 | ||||
Conversion of preferred stock | $ 122,878,000 | $ (122,878,000) | 122,878,000 | |||
Conversion of preferred stock (in shares) | (9,516,427) | 38,065,708 | ||||
Issuance of common stock from exercise of stock options | 2,193,000 | 2,193,000 | ||||
Issuance of common stock from exercise of stock options, (in shares) | 1,712,278 | |||||
Issuance of common stock, net of initial public offering costs | 217,796,000 | 217,796,000 | ||||
Issuance of common stock, net of initial public offering costs (in shares) | 15,091,074 | |||||
Stock-based compensation expense | 10,660,000 | 10,660,000 | ||||
Repurchase of common stock | $ (15,009,000) | (15,009,000) | ||||
Repurchase of common stock, shares | (490,419) | (490,419) | ||||
Awards effectively repurchased for required employee withholding taxes | $ (1,431,000) | (1,431,000) | ||||
Awards effectively repurchased for required employee withholding taxes (in shares) | (80,599) | |||||
Excess tax benefits from equity incentive plan activity | 9,663,000 | 9,663,000 | ||||
Realized tax benefit of deductible IPO transaction costs | 1,939,000 | 1,939,000 | ||||
Special dividend | 25,000 | 25,000 | ||||
Balance at Dec. 31, 2014 | (25,759,000) | $ 0 | 442,682,000 | (468,127,000) | (314,000) | |
Balance, shares at Dec. 31, 2014 | 0 | 69,811,326 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 31,695,000 | 31,695,000 | ||||
Other comprehensive income (loss) | (407,000) | (407,000) | ||||
Issuance of common stock from vested restricted stock units, (in shares) | 106,136 | |||||
Issuance of common stock for employee stock purchase plan | $ 5,315,000 | 5,315,000 | ||||
Issuance of common stock for employee stock purchase plan (in shares) | 272,836 | 272,836 | ||||
Issuance of common stock from exercise of stock options | $ 7,166,000 | 7,166,000 | ||||
Issuance of common stock from exercise of stock options, (in shares) | 2,112,131 | |||||
Stock-based compensation expense | 17,742,000 | 17,742,000 | ||||
Repurchase of common stock | $ (48,364,000) | (48,364,000) | ||||
Repurchase of common stock, shares | (1,895,625) | (1,895,625) | ||||
Awards effectively repurchased for required employee withholding taxes | $ (799,000) | (799,000) | ||||
Awards effectively repurchased for required employee withholding taxes (in shares) | (35,379) | |||||
Excess tax benefits from equity incentive plan activity | 20,670,000 | 20,670,000 | ||||
Realized tax benefit of deductible IPO transaction costs | 822,000 | 822,000 | ||||
Balance at Dec. 31, 2015 | 8,081,000 | 494,397,000 | (485,595,000) | (721,000) | ||
Balance, shares at Dec. 31, 2015 | 70,371,425 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 61,406,000 | 61,406,000 | ||||
Other comprehensive income (loss) | 117,000 | 117,000 | ||||
Issuance of common stock from vested restricted stock units, (in shares) | 695,253 | |||||
Issuance of common stock for employee stock purchase plan | $ 4,506,000 | 4,506,000 | ||||
Issuance of common stock for employee stock purchase plan (in shares) | 283,644 | 283,644 | ||||
Issuance of common stock from exercise of stock options | $ 5,272,000 | 5,272,000 | ||||
Issuance of common stock from exercise of stock options, (in shares) | 1,297,812 | 1,297,812 | ||||
Stock-based compensation expense | $ 26,318,000 | 26,318,000 | ||||
Repurchase of common stock | $ (71,604,000) | (71,604,000) | ||||
Repurchase of common stock, shares | (3,414,675) | (3,414,675) | ||||
Awards effectively repurchased for required employee withholding taxes | $ (4,145,000) | (4,145,000) | ||||
Awards effectively repurchased for required employee withholding taxes (in shares) | (217,769) | |||||
Excess tax benefits from equity incentive plan activity | 4,639,000 | 4,639,000 | ||||
Balance at Dec. 31, 2016 | $ 34,590,000 | $ 535,132,000 | $ (499,938,000) | $ (604,000) | ||
Balance, shares at Dec. 31, 2016 | 69,015,690 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities | |||
Net income | $ 61,406 | $ 31,695 | $ 15,497 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 39,175 | 52,817 | 84,403 |
Stock-based compensation | 26,497 | 17,923 | 10,960 |
Excess tax benefits received from equity incentive plan activity | (4,639) | (20,670) | (9,663) |
Deferred income taxes | 41,772 | 14,954 | 43,842 |
Accretion of workers' compensation and leases fair value adjustment | 0 | (639) | (1,090) |
Changes in operating assets and liabilities: | |||
Restricted cash and cash equivalents | (41,535) | (17,991) | (6,880) |
Prepaid income taxes | (37,715) | 24,494 | (23,387) |
Prepaid expenses and other current assets | (2,991) | 1,313 | (7,389) |
Workers' compensation collateral receivable | (2,679) | 3,152 | (5,413) |
Other assets | 262 | (14,527) | 8,004 |
Accounts payable | 9,158 | 287 | 5,212 |
Accrued corporate wages and other current liabilities | 3,247 | 5,616 | 7,749 |
Workers' compensation loss reserves | 54,161 | 31,483 | 29,822 |
Worksite employee related assets | 91,915 | 261,750 | (862,699) |
Worksite employee related liabilities | (93,502) | (261,058) | 862,931 |
Net cash provided by operating activities | 144,532 | 130,599 | 151,899 |
Investing activities | |||
Acquisitions of businesses | (300) | (4,750) | 0 |
Purchases of marketable securities | (14,959) | (41,939) | (24,875) |
Proceeds from maturity of marketable securities | 27,787 | 27,557 | 0 |
Purchase of property and equipment | (39,650) | (18,557) | (20,552) |
Net cash used in investing activities | (27,122) | (37,689) | (45,427) |
Financing activities | |||
Proceeds from issuance of common stock, net of issuance costs | 0 | 0 | 217,796 |
Repurchase of common stock | (71,604) | (48,364) | (15,009) |
Proceeds from issuance of common stock on exercised options | 5,272 | 7,166 | 2,193 |
Proceeds from issuance of common stock on employee stock purchase plan | 4,506 | 5,315 | 3,393 |
Awards effectively repurchased for required employee withholding taxes | (4,145) | (799) | (1,431) |
Proceeds from issuance of notes payable | 57,978 | 0 | 0 |
Payments for extinguishment of debt | (57,563) | 0 | 0 |
Repayment of notes and capital leases payable | (37,078) | (45,562) | (273,856) |
Payment of debt issuance costs | (1,376) | 0 | (11,060) |
Excess tax benefits received from equity incentive plan activity | 4,639 | 20,670 | 9,663 |
Tax credit received for deductible IPO transaction costs | 0 | 822 | 1,939 |
Net cash used in financing activities | (99,371) | (60,752) | (66,372) |
Effect of exchange rate changes on cash and cash equivalents | (213) | (321) | (115) |
Net increase in cash and cash equivalents | 17,826 | 31,837 | 39,985 |
Cash and cash equivalents at beginning of period | 166,178 | 134,341 | 94,356 |
Cash and cash equivalents at end of period | 184,004 | 166,178 | 134,341 |
Supplemental disclosures of cash flow information | |||
Interest paid | 15,420 | 15,224 | 32,051 |
Income taxes paid (refund), net | 39,285 | 2,005 | (3,809) |
Supplemental schedule of noncash investing and financing activities | |||
Payable for purchase of property and equipment | 823 | 344 | 1,290 |
Allowance for tenant improvements | $ 0 | $ 1,257 | $ 0 |
Description of Business and Sig
Description of Business and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Significant Accounting Policies | DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES Description of Business TriNet Group Inc. (TriNet or we, our and us), a professional employer organization (PEO) founded in 1988, provides comprehensive human resources (HR) solutions for small to midsize businesses (SMBs) under a co-employment model. These HR solutions include bundled services, such as multi-state payroll processing and tax administration, employee benefits programs, including health insurance and retirement plans, workers' compensation insurance and claims management, employment and benefit law compliance, and other services. Through the co-employment relationship, we are the employer of record for most administrative and regulatory purposes, including: • compensation through wages and salaries, • employer payroll-related taxes payment, • employee payroll-related taxes withholding and payment, • employee benefit programs including health and life insurance, and others, and • workers' compensation coverage. Our clients are responsible for the day-to-day job responsibilities of the worksite employees (WSEs). We operate in one reportable segment. All of our service revenues are generated from external clients. Less than 1% of revenue is generated outside of the U.S. Basis of Presentation Our consolidated financial statements are prepared in conformity with generally accepted accounting principles (GAAP) in the United States of America. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect certain reported amounts and related disclosures. Significant estimates include: • liability for unpaid losses and loss adjustment expenses (loss reserves) related to workers' compensation and workers' compensation collateral receivable, • health insurance loss reserves, • liability for insurance premiums payable, • impairments of goodwill and other intangible assets, • income tax assets and liabilities, and • liability for legal contingencies. These estimates are based on historical experience and on various other assumptions that we believe to be reasonable from the facts available to us. Some of the assumptions are highly uncertain at the time of estimation. To the extent actual experience differs from the assumptions used, our consolidated financial statements could be materially affected. Revenue Recognition Professional service revenues represent fees charged to clients for processing payroll-related transactions on behalf of our clients, access to our HR expertise, employment and benefit law compliance services and other HR related services. Professional service revenues are recognized in the period the services are rendered and earned under service arrangements with clients, where service fees are fixed or determinable, and collectability is reasonably assured. Under the accounting rules, we are not considered the primary obligor with respect to WSEs payroll and payroll tax payments and therefore, these payments are not reflected as either revenue or expense in our consolidated statements of income. The gross payroll and payroll tax payments made on behalf of our clients, combined, were $34.3 billion , $30.6 billion and $25.6 billion for the years ended December 31, 2016 , 2015 , and 2014 , respectively. We generally charge an upfront non-refundable set-up fee which is recognized on a straight-line basis over the estimated average client tenure. Insurance service revenues consist of insurance-related billings and administrative fees collected from clients and withheld from WSEs for workers' compensation insurance and health benefit insurance plans provided by third-party insurance carriers. Insurance service revenues are recognized in the period amounts are due and where collectability is reasonably assured. The professional service revenues and insurance service revenues are each considered separate units of accounting for administrative services and insurance related benefits billed to the majority of our clients. For clients billed through a bundled invoice, the selling price of significant deliverables is determined based on the best estimate of the selling price. Insurance Costs Our fully-insured insurance plans are provided by third-party insurance carriers under guaranteed-cost or risk-based insurance policies. Under guaranteed-cost policies, our carriers establish the premiums and we are not responsible for any deductibles. Under risk-based policies, we agree to reimburse our carriers for any claims paid within an agreed-upon deductible layer. Insurance costs include insurance premiums for coverage provided by insurance carriers, reimbursement of claims payments made by insurance carriers or third-party administrators, and changes in loss reserves related to our workers' compensation and health benefit insurance. At policy inception, annual workers' compensation premiums are estimated based on projected wages over the duration of the policy period and the risk categories of the WSEs. As actual wages are realized, the amounts paid for premiums may differ from the estimates that we recorded, creating an asset or liability throughout the policy year. Such asset or liability is reported on our consolidated balance sheets as prepaid insurance premiums or insurance premiums payable, respectively. Workers' Compensation Loss Reserves We have secured fully-insured insurance policies with insurance carriers for our clients and WSEs that obligate us to reimburse the insurance carriers for losses up to $1 million per claim occurrence (deductible layer). Workers' compensation insurance reserves represent our liability for unpaid losses and loss adjustment expenses. These reserves are established to provide for the estimated ultimate costs of paying claims within the deductible layer in accordance with worker's compensation insurance policies. These reserves include estimates for reported and incurred but not reported (IBNR) losses, and expenses associated with processing and settling the claims. In establishing these reserves, we use an independent actuary to provide an estimate of undiscounted future cash payments that would be made to settle the claims based upon: • TriNet's historical loss experience, exposure data, and industry loss experience, • inputs including WSE job responsibilities and location, • historical frequency and severity of workers' compensation claims, • an estimate of future cost trends to establish expected loss ratios for subsequent accident years, • expected loss ratios for the latest accident year or prior accident years, adjusted for the loss trend, the effect of rate changes and other quantifiable factors, and • loss development factors to project the reported losses for each accident year to an ultimate basis. We assess the workers' compensation loss reserves on a quarterly basis. For each reporting period, changes in the actuarial methods and assumptions resulting from changes in actual claims experience and other trends are incorporated into the workers' compensation loss reserves. Adjustments to previously established reserves are reflected in the results of operations for the period in which the adjustment is identified. Such adjustments could be significant, reflecting any variety of new and adverse or favorable trends. Accordingly, final claim settlements may vary materially from the present estimates, particularly when those payments may not occur until well into the future. In our experience, plan years related to workers' compensation programs may take ten years or more to be settled. We do not discount workers' compensation loss reserves. Claim costs expected to be paid within one year are recorded as workers' compensation reserves included in short-term WSE related liabilities. Claim costs expected to be paid beyond one year are included in long-term liabilities. Insurance carriers are responsible for administering and paying claims. We are responsible for reimbursing each carrier up to a deductible limit per occurrence. We have collateral agreements with various insurance carriers where either we retain custody of funds in trust accounts which we record as restricted cash and cash equivalents, or remit funds to carriers. Collateral whether held by us, or the carriers, is used to settle our insurance and claim deductible obligations to them. Collateral is calculated by policy year and remains restricted until the policy year is fully settled. Collateral paid to carriers, by agreement permits net settlement of obligations against collateral held, which we record net of our loss reserves (Carrier Collateral Offset). Any excess funds held by carriers over our recorded loss reserves by policy year can be returned to us based on the agreements with them. Based on the estimated timing of return, such excess funds are recorded as workers' compensation collateral receivable, in WSE related assets or in long-term assets. Health Benefits Loss Reserves We sponsor and administer a number of fully-insured, risk based employee benefit plans, including group health, dental, and vision as an employer plan sponsor under section 3(5) of the Employee Retirement Income Security Act (ERISA). Approximately 38% of our 2016 group health insurance premiums were for guaranteed-cost policies which are fully-insured policies where we are not responsible for any deductible. The remaining 62% by premium of our 2016 policies relate to fully-insured policies where we reimburse our health insurers for claims incurred within a per person deductible layer up to a maximum aggregate exposure limit per policy. These deductible dollar limits and maximum limits vary by carrier and year. Health benefits loss reserves are established to provide for the estimated unpaid costs of reimbursing the carriers for paying claims within the deductible layer in accordance with health insurance policies. These reserves include estimates for reported losses, plus estimates for claims incurred but not paid. We assess reserves regularly based upon independent actuarial studies that include other relevant factors such as current and historical claims payment patterns, plan enrollment and medical trend rates. Under certain policies, based on plan performance, we may be entitled to receive refunds of premiums which we recognize in accordance with the policy terms. We estimate these refunds based on premium and claims data and record as a reduction in the insurance costs on the consolidated statements of income and prepaid health plan expenses in WSE related assets on the consolidated balance sheets. As of December 31, 2016 and 2015 , we had $8.6 million and $6.8 million , respectively, included within WSE related assets as prepaid insurance premiums. Cash and Cash Equivalents Cash and cash equivalents include bank deposits and short-term, highly liquid investments. Investments with original maturity dates of three months or less are considered cash equivalents. Restricted Cash, Cash Equivalents and Investments Restricted cash and cash equivalents presented on our consolidated balance sheets represents our corporate cash and cash equivalents in trust accounts functioning as security deposits for our insurance carriers. These deposits are not used for settling insurance premiums or claims payments. WSE related assets also includes restricted cash, cash equivalents and investments held in trust for current and future premium and claim obligations with our insurance carriers. Amounts are held in trust according to the terms of the relevant insurance policies and by the local insurance regulations of the jurisdictions in which the policies are in force. Investments We have investments primarily in marketable securities including U.S. treasuries, which are classified as available for sale and are carried at estimated fair value. Unrealized gains and losses are reported as a component of accumulated other comprehensive income (loss), net of deferred income taxes. The amortized cost of marketable securities is adjusted for amortization of premiums and accretion of discounts from the date of purchase to maturity or sale. Such amortization is included in interest income as an addition to or deduction from the coupon interest earned on the investments. We use the specific identification method to determine the realized gains and losses on the sale of available for sale securities. Realized gains and losses are included in other income in the accompanying consolidated statements of income. We assess our investments for an other-than-temporary impairment loss due to a decline in fair value or other market conditions. We review several factors to determine whether a loss is other than temporary, such as the length and extent of the fair value decline, the financial condition and near-term prospects of the issuer and whether we have the intent to sell or will more likely than not be required to sell before the securities' anticipated recovery, which may be at maturity. If management determines that a security is impaired under these circumstances, the impairment recognized in earnings is measured as the entire difference between the amortized cost and the then-current fair value. Fair Value of Financial Instruments Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. Our financial assets recorded at fair value on a recurring basis are comprised of available for sale marketable securities and certificates of deposits. We measure certain financial assets at fair value for disclosure purposes, as well as on a nonrecurring basis when they are deemed to be other-than-temporarily impaired. Our other current financial assets and our other current financial liabilities, including cash and cash equivalents, restricted cash and cash equivalents, WSE related assets and liabilities excluding insurance loss reserves, line of credit and accrued corporate wages, have fair values that approximate their carrying value due to their short-term nature. Assets and liabilities recorded at fair value are measured and classified in accordance with a three-tier fair value hierarchy based on the observability of the inputs available in the market to measure fair value, summarized as follows: • Level I—observable inputs for identical assets or liabilities, such as quoted prices in active markets, • Level II—inputs other than the quoted prices in active markets that are observable either directly or indirectly, • Level III—unobservable inputs in which there is little or no market data, which requires that we develop our own assumptions. The fair value hierarchy requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. We classify our cash equivalents, debt securities and notes payable in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement in its entirety. WSE related Assets and Liabilities Current assets and liabilities resulted from transactions directly or indirectly associated with WSEs, including payroll and related taxes and withholdings, our sponsored workers' compensation and health insurance programs, and other benefit programs, are reported in WSE related assets and liabilities on the consolidated balance sheets. These assets and liabilities are reported separately from our corporate assets and liabilities to better distinguish our corporate position from those assets and liabilities held by us to fund client payrolls. Unbilled Revenue We recognize WSE payroll and payroll tax liabilities in the period in which the WSEs perform work. When clients' pay periods cross reporting periods, we accrue the portion of the unpaid WSE payroll and the corresponding payroll tax liabilities associated with the work performed prior to period-end. These estimated payroll and payroll taxes liabilities as accrued wages in WSE related liabilities. The associated receivables, including estimated revenues, offset by advance collections from clients, are recorded as unbilled revenues in WSE related assets. Accounts Receivable Our accounts receivable recorded in WSE related assets, represent outstanding gross billings to clients, net of an allowance for doubtful accounts. We establish an allowance for doubtful accounts based on historical experience, the age of the accounts receivable balances, credit quality of clients, current economic conditions and other factors that may affect clients’ ability to pay, and charge-off amounts when they are deemed uncollectible. Property and Equipment We record property and equipment at historical cost and compute depreciation using the straight-line method over the estimated useful lives of the assets or the lease terms, generally three to five years for software and office equipment, five to seven years for furniture and fixtures, and the shorter of the asset life or the remaining lease term for leasehold improvements. We expense the cost of maintenance and repairs as incurred and capitalize leasehold improvements. We capitalize internal and external costs incurred to develop internal-use computer software during the application development stage. Application development stage costs include license fees paid to third-parties for software use, software configuration, coding, and installation. Capitalized costs are amortized on a straight-line basis over the estimated useful life, typically ranging from three to five years, commencing when the software is placed into service. We expense costs incurred during the preliminary project stage, as well as general and administrative, overhead, maintenance and training costs, and costs that do not add functionality to existing systems. For the years ended December 31, 2016 , 2015 and 2014 , internally developed software costs capitalized were $21.3 million , $11.2 million and $6.3 million respectively. We periodically assess the likelihood of unsuccessful completion of projects in progress, as well as monitor events or changes in circumstances, which might suggest that impairment has occurred and recoverability should be evaluated. An impairment loss is recognized if the carrying amount of the asset is not recoverable and exceeds the future net cash flows expected to be generated by the asset. Goodwill and Other Intangible Assets Our goodwill and identifiable intangible assets with indefinite useful lives are not amortized, but are tested for impairment on an annual basis or when an event occurs or circumstances change in a way to indicate that there has been a potential decline in the fair value of the reporting unit. Goodwill impairment is determined by comparing the estimated fair value of the reporting unit to its carrying amount, including goodwill. Our business is largely homogeneous and, as a result, all goodwill is associated with one reporting unit within our reportable segment. Annually, we perform a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit has declined below carrying value. This assessment considers various financial, macroeconomic, industry, and reporting unit specific qualitative factors. We perform our annual impairment testing in the fourth quarter. Based on the results of our reviews, no impairment loss was recognized in the results of operations for the years ended December 31, 2016 , 2015 and 2014 . Intangible assets with finite useful lives are amortized over their respective estimated useful lives ranging from two to ten years using either the straight-line method or an accelerated method. Intangible assets are reviewed for indicators of impairment at least annually and evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Based on the results of our reviews, no impairment loss was recognized in the results of operations for the years ended December 31, 2016 , 2015 and 2014 . Impairment of Long-Lived Assets We evaluate our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is considered impaired if the carrying amount exceeds the undiscounted future net cash flows the asset is expected to generate. An impairment charge is recognized for the amount by which the carrying amount of the assets exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less selling costs. Advertising Costs We expense the costs of producing advertisements at the time production occurs, and expense the cost of running advertisements in the period in which the advertising space or airtime is used as sales and marketing expense. Advertising costs were $6.4 million , $8.2 million , and $7.3 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. Stock-Based Compensation We have three types of stock-based awards to employees: restricted stock units (time based and performance based), stock options and an employee stock purchase plan. Compensation expense associated with restricted stock units is based on the fair value of common stock on the date of grant. Compensation expense associated with stock options and employee stock purchase plan are based on the estimated grant date fair value method using the Black-Scholes option pricing model. Expense is recognized using a straight-line amortization method over the respective vesting period for awards that are ultimately expected to vest. Accordingly, stock-based compensation has been reduced for estimated forfeitures. When estimating forfeitures, we consider voluntary termination behavior as well as trends of actual forfeitures. A tax benefit from stock-based compensation is recognized in additional paid in capital to the extent that an incremental tax benefit is realized. Income Taxes We account for our provision for income taxes using the asset and liability method, under which we recognize income taxes payable or refundable for current year and deferred tax assets and liabilities for future tax effect of events that have been recognized in our financial statements or tax returns. We measure our current and deferred tax assets and liabilities based on provision of enacted tax laws of those jurisdictions in which we operate. The effect of changes in tax laws and regulations, or interpretations, is recognized in our consolidated financial statements in the period that includes the enactment date. We recognize deferred tax assets and liabilities based on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and amounts used for income tax purposes, as well as the expected benefits of using net operating loss and other carryforwards. We are required to establish a valuation allowance when it is determined more likely than not that the deferred tax assets will not be realized. Provision for income taxes may change when estimates used in determining valuation allowances change or when receipt of new information indicates the need for adjustment in valuation allowances. Changes in valuation allowances are reflected as a component of provision for income taxes in the period the change is enacted. We recognize a reserve for uncertain tax positions taken or expected to be taken in a tax return when it is concluded that tax positions are not more likely than not to be sustained upon examination by taxing authorities, including resolution of any related appeals or litigation processes, based on the technical merits of the positions. Assumptions, judgment and the use of estimates are required in determining if the more likely than not standard has been met when developing the provision for income taxes and in determining the expected benefit. The tax benefits of the position recognized in the financial statements are then measured based on the largest amount of benefit that is greater than 50% likely to be realized upon settlement with a taxing authority. Unrecognized tax benefits due to tax uncertainties that do not meet the minimum probability threshold are included as other liabilities and are charged to earnings in the period that such determination is made. We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. Accrued interest and penalties are included in other liabilities on the consolidated balance sheet. Concentrations of Credit Risk Financial instruments subject to concentrations of credit risk include cash, cash equivalents and investments (including payroll funds collected), accounts receivable, and amounts due from insurance carriers. We maintain these financial assets principally in domestic financial institutions. We perform periodic evaluations of the relative credit standing of these institutions. Our exposure to credit risk in the event of default by the financial institutions holding these funds is limited to amounts currently held by the institution in excess of insured amounts. Under the terms of professional services agreements, clients agree to maintain sufficient funds or other satisfactory credit at all times to cover the cost of their current payroll, all accrued paid time off, vacation or sick leave balances, and other vested wage and benefit obligations for all their work site employees. We generally require payment from our clients on or before the applicable payroll date. For certain clients, we require an indemnity guarantee payment (IGP) supported by a letter of credit, bond, or a certificate of deposit from certain financial institutions. The IGP typically equals the total payroll and service fee for one average payroll period. As of December 31, 2016 , no client accounted for more than 10% of total accounts receivable. As of December 31, 2015 , one client accounted for 12% of total accounts receivable. No client accounted for more than 10% of total revenues in the years ended December 31, 2016 , 2015 and 2014 . Bad debt expense, net of recoveries was $1.3 million , $2.0 million and $1.4 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. Recent Accounting Pronouncements Recently adopted accounting guidance Debt issuance costs - In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03- Simplifying the Presentation of Debt Issuance Costs, and, in August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements. These ASUs require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt, which is consistent with the presentation of debt discounts and premiums. The presentation and subsequent measurement of debt issuance costs associated with lines of credit, may be presented as an asset and amortized ratably over the term of the line of credit arrangement, regardless of whether there are outstanding borrowings on the arrangement. The recognition and measurement guidance for debt issuance costs are not affected by these ASUs. We adopted these ASUs as of March 31, 2016. The adoption of these ASUs resulted in a reclassification of unamortized debt issuance costs of $2.4 million from other current assets to current portion of notes and capital leases payable and $3.4 million from other assets to notes and capital leases payable, less current portion, as of December 31, 2015. Unamortized debt issuance costs related to our revolving credit facility will remain classified within other assets in the accompanying consolidated balance sheets. The adoption of this guidance did not have any impact on our consolidated statements of income, comprehensive income or cash flows. Recent issued accounting pronouncements Lease arrangements - In February 2016, the FASB, issued ASU 2016-02- Leases. The amendment requires that lease arrangements longer than 12 months result in an entity recognizing lease assets and lease liabilities. Most significant impact is on those leases classified as operating leases under previous U.S. GAAP. Under the new standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The amendment is effective for annual reporting periods, and interim periods within those years beginning after December 15, 2018. Early adoption is permitted, the new standard will be effective for us beginning January 1, 2018. We will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. We currently anticipate early adoption of the new standard effective January 1, 2018 in conjunction with our adoption of the new revenue standard. Our ability to early adopt is dependent on system readiness and the completion of our analysis of information necessary to restate prior period financial statements. As of December 31, 2016, we had a total of $64.6 million non-cancelable operating lease commitments. We anticipate this standard will have a material impact on our consolidated financial statements. While we are continuing to assess all potential impacts of the standard, we currently believe the most significant impact relates to our accounting for equipment, office and data-center operating leases. Financial Instruments - In January 2016, the FASB issued ASU 2016-01- Recognition and Measurement of Financial Assets and Financial Liabilities . The amendment addresses various aspects of the recognition, measurement, presentation, and disclosure for financial instruments. The amendment is effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Early adoption by public entities is permitted only for certain provisions. We are currently in the process of evaluating the impact of the adoption of this standard on our consolidated financial statements. Revenue Recognition - In May 2014, the FASB issued ASU 2014-09- Revenue from Contracts with Customers , which will replace most existing revenue recognition guidance under GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard provides a five-step analysis of transactions to determine when and how revenue is recognized. In July 2015, the FASB deferred the effective date to annual reporting periods, and interim periods within those years, beginning after December 15, 2017. Early adoption at the original effective date of December 15, 2016 is permitted. The amendments may be applied retrospectively or as a cumulative-effect adjustment as of the date of adoption. In March, April and May 2016, the FASB issued ASU 2016-08 Principal versus Agent Considerations (Reporting Revenue Gross versus Net), ASU 2016-10 Identifying Performance Obligations and Licensing, ASU 2016-12 Narrow-Scope Improvements and Practical Expedients and ASU 2016-20 Technical Corrections and Improvements, respectively, providing further clarification to be considered when implementing ASU 2014-09. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). We currently anticipate adopting the standard using the full retrospective method to restate each prior reporting period presented. The new standard will be effective for us beginning January 1, 2018. Our ability to adopt using the full retrospective method is dependent on system readiness and the completion of our analysis of information necessary to restate prior period financial statements. We anticipate this standard will have a material impact on our consolidated financial statements. While we are continuing to assess all potential impacts of the standard, we |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 12 Months Ended |
Dec. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents and Investments | CASH, CASH EQUIVALENTS AND INVESTMENTS Under the terms of the agreements with certain of our workers' compensation and health benefit insurance carriers, we are required to maintain collateral in trust accounts for the benefit of specified insurance carriers and to reimburse the carriers’ claim payments within our deductible layer. We invest a portion of the collateral amounts in marketable securities. We report the current portion of these trust accounts as restricted cash and cash equivalents in WSE related assets, and long term portion as restricted cash, cash equivalents and investments on the consolidated balance sheets. We require our clients to prefund their payroll and related taxes and other withholding liabilities before payroll is processed or due for payment. This prefund is included in WSE related assets as payroll funds collected which is designated to pay pending payrolls and other WSE related liabilities. Our total corporate and WSE related cash, cash equivalents and investments are summarized below: December 31, 2016 December 31, 2015 (In thousands) Cash and cash equivalents Available for sale marketable securities Certificate of deposits Total Cash and cash equivalents Available for sale marketable securities Certificate of deposits Total Cash and cash equivalents $ 184,004 $ — $ — $ 184,004 $ 166,178 $ — $ — $ 166,178 Restricted cash and cash equivalents 14,569 14,569 14,557 14,557 Restricted cash, cash equivalents and investments, noncurrent Collateral for workers' compensation claims 78,672 51,829 — 130,501 38,711 63,095 — 101,806 Worksite employee related assets Restricted cash, cash equivalents and investments, current Collateral for health benefits claims 65,022 — — 65,022 46,980 — — 46,980 Collateral for workers' compensation claims 64,773 64,773 45,937 1,500 47,437 Investments — — 2,320 2,320 — — 2,319 2,319 Total WSE related restricted cash, cash equivalents and investments, current 129,795 — 2,320 132,115 92,917 1,500 2,319 96,736 Payroll funds collected 825,958 — — 825,958 859,322 — — 859,322 Total $ 1,232,998 $ 51,829 $ 2,320 $ 1,287,147 $ 1,171,685 $ 64,595 $ 2,319 $ 1,238,599 |
Worksite Employee Related Asset
Worksite Employee Related Assets and Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Other Industries [Abstract] | |
Worksite Employee Related Assets and Liabilities | WORKSITE EMPLOYEE RELATED ASSETS AND LIABILITIES WSE related assets and WSE related liabilities are intended to be reviewed together when considering the position of the company. The client directs the price and service specifications for payroll and payroll taxes and as a result, we are not the primary obligor for payroll and payroll tax payments and therefore, record these amounts net in our statements of income. However, we record without offset, accrued wages and payroll tax liabilities for WSEs in WSE related liabilities with the related payroll funds collected and unbilled revenues in WSE related assets. We have classified these assets and liabilities and other service related amounts, collectively as WSE related, to present a clearer picture of the inter-relationship of the balances and distinguish these from our other corporate assets and liabilities. In addition to unbilled revenues, accrued wages and payroll tax liabilities, other significant balances included in the WSE related assets and liabilities include: • Payroll funds collected represents cash collected from clients in advance to fund payroll and payroll taxes, and other payroll related liabilities; • Other payroll assets primarily include payroll tax receivables. As of December 31, 2015, there was a receivable of $181 million from one client related to an end of year payroll tax liability for which funding was received in January 2016. • Client deposits represent IGP payments received from clients and collections from clients in excess of payroll and other payroll related liabilities; • Other payroll withholdings primarily include withholdings under 401(k) plans and flexible benefit plans. (In thousands) December 31, 2016 December 31, 2015 Worksite employee related assets: Restricted cash, cash equivalents and investments $ 132,115 $ 96,736 Payroll funds collected 825,958 859,322 Unbilled revenues (net of advance collections of $8,602 and $11,875 at December 31, 2016 and 2015, respectively) 293,192 213,837 Accounts receivable (net of allowance for doubtful accounts of $292 and $1,158 at December 31, 2016 and 2015, respectively) 4,854 5,060 Prepaid insurance premiums 12,805 8,832 Workers' compensation collateral receivable 2,136 2,428 Other payroll assets 10,411 187,171 Total worksite employee related assets $ 1,281,471 $ 1,373,386 Worksite employee related liabilities: Accrued wages $ 272,966 $ 202,396 Client deposits 56,182 57,758 Payroll tax liabilities 692,460 883,608 Unpaid losses and loss adjustment expenses (less than 1 year): Health benefits loss reserves 129,430 112,658 Workers' compensation loss reserves (net of collateral paid of $9,234 and $11,761 at December 31, 2016 and 2015, respectively) 63,702 57,731 Insurance premiums and other payables 14,223 23,813 Other payroll withholdings 47,032 31,533 Total worksite employee related liabilities $ 1,275,995 $ 1,369,497 Included in the payroll tax liabilities and insurance premiums and other payables were amounts relating to approximately 2,600 and 2,500 of our corporate employees at December 31, 2016 and 2015 , respectively. |
Workers' Compensation Loss Rese
Workers' Compensation Loss Reserves | 12 Months Ended |
Dec. 31, 2016 | |
Insurance [Abstract] | |
Workers' Compensation Loss Reserves | WORKERS' COMPENSATION LOSS RESERVES The following summarizes the activities in the consolidated balance sheets for unpaid claims and claims adjustment expenses within workers' compensation assets and liabilities: Year Ended December 31, (in thousands) 2016 2015 2014 Total loss reserves, beginning of year $ 190,102 $ 148,034 $ 120,739 Incurred Current year 112,967 89,137 63,377 Prior years 28,243 26,391 15,401 Total incurred 141,210 115,528 78,778 Paid Current year (14,411 ) (16,376 ) (13,086 ) Prior years (62,287 ) (57,084 ) (38,397 ) Total paid (76,698 ) (73,460 ) (51,483 ) Total loss reserves, end of year $ 254,614 $ 190,102 $ 148,034 Collateral paid to carriers and offset against loss reserves (31,611 ) (26,890 ) (55,492 ) Total loss reserves, net of carrier collateral offset $ 223,003 $ 163,212 $ 92,542 Payable in less than 1 year (1) (net of collateral paid to carriers of $9,234, $11,761 and $10,275 as of December 31, 2016, 2015 and 2014, respectively) 63,702 57,731 17,094 Payable in more than 1 year (net of collateral paid to carriers of $22,377, $15,129 and $45,217 as of December 31, 2016, 2015 and 2014, respectively) 159,301 105,481 75,448 Workers' Compensation Loss Reserves $ 223,003 $ 163,212 $ 92,542 (1) Included under WSE related liabilities within Note 3 to these consolidated financial statements. Incurred claims related to prior years represent changes in estimates for ultimate losses on workers' compensation claims. For the year ended December 31, 2016 , the adverse development was primarily due to higher than expected severity of reported claims associated with our non-office WSEs in recent accident years. For the years ended December 31, 2015 and 2014 , the adverse development resulted from changes in estimates for ultimate losses associated with non-office WSEs. As of December 31, 2016 , 2015 and 2014 , we had $65.6 million , $58.5 million and $95.4 million , respectively, collateral held by insurance carriers of which $31.6 million , $26.9 million and $55.5 million was offset against workers' compensation loss reserves as the agreements permit and are net settled of insurance obligations against collateral held. Collateral paid to each carrier for a policy year in excess of our loss reserves are recorded as workers' compensation collateral receivable. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | PROPERTY AND EQUIPMENT, NET Property and equipment, net, consists of the following: (In thousands) December 31, 2016 December 31, 2015 Software $ 88,161 $ 64,727 Office equipment, including data processing equipment 20,974 20,044 Leasehold improvements 11,785 9,874 Furniture, fixtures, and equipment 11,421 7,911 Projects in progress 10,714 7,407 Total 143,055 109,963 Less: Accumulated depreciation (84,433 ) (72,119 ) Property and equipment, net $ 58,622 $ 37,844 Projects in progress consist primarily of development costs for internally developed software, which we capitalize and amortize on a straight-line basis over the estimated useful life. We recognized depreciation expense for capitalized internally developed software of $10.2 million , $5.4 million , and $5.2 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS The following summarizes goodwill and other intangible assets: December 31, 2016 December 31, 2015 (In thousands) Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Goodwill $ 289,207 $ — $ 289,207 $ 289,207 $ — $ 289,207 Amortizable intangibles: Customer contracts 10 years 209,850 (182,168 ) 27,682 209,850 (167,968 ) 41,882 Trademark 3 years 16,900 (16,900 ) — 16,900 (16,467 ) 433 Developed technology 5 years 5,700 (2,308 ) 3,392 5,400 (1,173 ) 4,227 Noncompete agreements 3 years 1,940 (1,940 ) — 1,940 (1,710 ) 230 Total $ 234,390 $ (203,316 ) $ 31,074 $ 234,090 $ (187,318 ) $ 46,772 We evaluate the remaining useful life of intangible assets annually to determine whether events and circumstances warrant a revision to the estimated remaining useful life. On October 1, 2016, we adjusted the estimated useful lives of customer contracts acquired from Ambrose, from a previously estimated useful life of 5 years to 10 years. Expense related to intangibles amortization in future periods as of December 31, 2016 is expected to be as follows: Year ending December 31: Amount (in thousands) 2017 $ 5,265 2018 5,199 2019 5,199 2020 4,759 2021 and thereafter 10,652 Total $ 31,074 |
Financial Instruments And Fair
Financial Instruments And Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Financial Instruments And Fair Value Measurements | FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Cash, Cash equivalents and Restricted Investments We classify our cash, cash equivalents and restricted investments in marketable securities within Level I in the fair value hierarchy because we use quoted market prices to determine the fair value. We classify our certificates of deposit within Level II in the fair value hierarchy as we use a market approach that compares fair values on certificates with similar maturities. We have no available for sale securities included in Level III as of December 31, 2016 and 2015 . There was no transfer of any assets and liabilities between Levels during years ended December 31, 2016 and 2015 . The following table summarizes our investments by significant categories and fair value measurement on a recurring basis as of December 31, 2016 and 2015 : (In thousands) Maturity (in years) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value December 31, 2016 Level 1: Investments: U.S. treasuries < 3 $ 51,376 $ 25 $ (77 ) $ 51,324 Mutual funds N/A 500 5 — 505 Total investments $ 51,876 $ 30 $ (77 ) $ 51,829 Level 2: Certificates of deposit < 1 $ 2,320 $ — $ — 2,320 Total $ 54,149 December 31, 2015 Level 1: Investments U.S. treasuries < 4 $ 64,226 $ 9 $ (144 ) $ 64,091 Mutual funds N/A 500 4 — 504 Total investments $ 64,726 $ 13 $ (144 ) $ 64,595 Level 2: Certificates of deposit < 1 $ 2,319 $ — $ — $ 2,319 Total $ 66,914 There were de minimis realized gains or losses for the years ended December 31, 2016 and 2015 . We had $0.1 million gross unrealized losses in our U.S. Treasury securities as of December 31, 2016 and 2015 . The fair value of these securities in an unrealized loss position represented 58% and 81% of the total fair value of all U.S. Treasury securities as of December 31, 2016 and 2015 , respectively. Unrealized losses are principally caused by changes in interest rates. In analyzing an issuer's financial condition, we consider whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and industry analysts' reports. As we have the ability to hold these available for sale marketable securities until maturity, or for the foreseeable future, no decline was deemed to be other-than-temporary. Notes Payable The carrying value of our notes payable at December 31, 2016 and 2015 was $462.9 million and $499.6 million , respectively, which approximated fair value. These valuations are considered Level II in the hierarchy for fair value measurement. At December 31, 2016, the valuation was based on readily available quoted market prices. The discounted cash flow method of valuation was used as of December 31, 2015. |
Notes Payable and Capital Lease
Notes Payable and Capital Leases Payable | 12 Months Ended |
Dec. 31, 2016 | |
Line of Credit Facility [Abstract] | |
Notes Payable and Capital Leases Payable | NOTES AND CAPITAL LEASES PAYABLE As of December 31, 2016 , notes and capital leases payable consisted of the following: (In thousands) December 31, December 31, Annual Effective Interest Rate Maturity Term loan A $ 330,469 $ 351,563 3.250 % (1) 3.46 % July 2019 Term loan B — 148,000 3.220 % (2) N/A July 2017 Term loan A-2 132,469 — 3.125 % (3) 3.29 % July 2019 Total term loans 462,938 499,563 Deferred loan costs (4,018 ) (5,781 ) Capital leases 134 153 Less: current portion (36,559 ) (32,970 ) Non-current term portion $ 422,495 $ 460,965 (1) Bears interest at LIBOR plus 2.25% or the prime rate plus 1.25% at our option, subject to certain rate adjustments based upon our total leverage ratio. (2) Contractual interest rate in place at June 30, 2016, prior to the refinancing in July 2016. (3) Bears interest at LIBOR plus 2.125% or the prime rate plus 1.125% at our option, subject to certain rate adjustments based upon our total leverage ratio. In July 2016, we refinanced our Amended and Restated First Lien Credit Agreement (Credit Agreement). We replaced $135.0 million of outstanding tranche B term loans maturing July 2017 with substantially the same amount of new tranche A-2 term loans maturing July 2019. The $342.0 million of existing tranche A term loans and the $75.0 million revolving credit facility were not refinanced. As part of the $135.0 million refinancing transaction, $57.6 million was recorded as an extinguishment, and $77.0 million was rolled over into the new tranche A-2 term loans and was treated as a debt modification. The proceeds of the tranche A-2 term loans were used to: (i) refinance the remaining tranche B term loans outstanding under the Credit Agreement and (ii) pay related fees and expenses. As a result of this refinancing, approximately $1.4 million in fees and costs were incurred, of which $0.8 million were recorded as deferred loan cost with the remainder expensed. Interest on term loans is payable quarterly. We are required to pay a quarterly commitment fee of 0.50% which may decrease to 0.375% based on our total leverage ratio, on the daily unused amount of the commitments under the revolving credit facility, as well as fronting fees and other customary fees for letters of credit issued under the revolving credit facility. The $75.0 million revolving credit facility includes capacity for a $40.0 million letter of credit facility and a $10.0 million swingline facility. Letters of credit issued pursuant to the revolving credit facility reduce the amount available for borrowing under the revolving credit facility. The total unused portion of the revolving credit facility was $59.5 million as of December 31, 2016 . We are permitted to make voluntary prepayments at any time without payment of a premium. We are required to make mandatory prepayments of term loans (without payment of a premium) with (i) net cash proceeds from issuances of debt (other than certain permitted debt), and (ii) net cash proceeds from certain non-ordinary course asset sales and casualty and condemnation proceeds (subject to reinvestment rights and other exceptions). The tranche A and A-2 term loans will be repaid in quarterly installments in aggregate annual amounts as follows (in thousands): Year ending December 31, 2017 2018 2019 Total Term loan repayments $ 38,250 $ 41,438 $ 383,250 $ 462,938 The Credit Agreement contains customary representations and warranties, and customary affirmative and negative covenants applicable to us, including, among other things, restrictions on indebtedness, liens, investments, mergers, and other dispositions. The Credit Agreement also defines certain restricted payments including prepayment of other indebtedness, dividends and stock repurchases within a dollar limit. This limit is subject to adjustments based on our total leverage ratio and continued compliance with the financial covenants set forth in the Credit Agreement. The financial covenants under the Credit Agreement require us to maintain a minimum consolidated interest coverage ratio of at least 3.50 to 1.00 and a maximum total leverage ratio of 4.25 to 1.00 at December 31, 2016 and 2015 . We were in compliance with these financial covenants under the credit facilities at December 31, 2016 and 2015 . The credit facility is secured by substantially all of our assets, other than excluded assets as defined in the Credit Agreement, which includes certain customary assets, assets held in trusts as collateral and WSE related assets. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | STOCKHOLDERS’ EQUITY Common Stock Upon closing of our IPO in March 2014 , we issued 15,000,000 shares of common stock at a public offering price $16 per share, for an aggregate offering price of $240.0 million , resulting in net proceeds to us of $216.8 million , after deducting underwriting discounts and commissions of approximately $16.8 million and offering expenses of approximately $5.6 million . Equity-Based Incentive Plans In December 2009, the board of directors approved the 2009 Equity Incentive Plan (the 2009 Plan) which provides for the grant of various equity awards to eligible employees, directors, and consultants including stock options, restricted stock unit (time-based and performance-based) and other stock awards. Shares available for grant as of December 31, 2016 were 6.7 million . Stock Options Stock options are granted to employees under the 2009 Plan at exercise prices equal to the fair market value of our common stock on the dates of grant. Options generally have a maximum contractual term of 10 years. Options are generally vested over four years, based on continued service. Stock options are forfeited if the employee ceases to be employed by us prior to vesting. The following table summarizes stock option activity under our equity-based plans for the year ended December 31, 2016 : Number Weighted Weighted Aggregate Balance at December 31, 2015 4,446,149 $ 8.96 7.56 $ 52,108 Granted — — Exercised (1,297,812 ) 4.06 Forfeited (261,029 ) 17.53 Expired (72,084 ) 27.01 Balance at December 31, 2016 2,815,224 $ 9.96 6.66 $ 46,231 Exercisable at December 31, 2016 2,014,443 $ 8.00 6.42 $ 36,459 Vested and expected to vest at December 31, 2016 2,775,326 $ 9.83 6.65 $ 45,865 Year Ended December 31, Additional Disclosures for Stock Options 2016 2015 2014 Weighted-average grant date fair value of stock options N/A $ 12.73 $ 7.18 Total fair value of options vested (in millions) $ 6.8 $ 12.2 $ 7.5 Total intrinsic value of options exercised (in millions) $ 20.5 $ 53.3 $ 35.1 Cash received from options exercised (in millions) $ 5.3 $ 7.3 $ 2.2 Restricted Stock Units Restricted stock units are subject to time-based or performance-based vesting conditions: • The time-based restricted stock units (RSUs) granted to non-employee directors generally fully vest on the first anniversary of the grant date; • The RSU granted to employees are generally subject to vesting ratably on a quarterly basis over four years; • The performance-based restricted stock units (PSUs) are subject to vesting based on our achievement of the financial performance metrics and other goals that are established at the grant date. The financial performance metric established represents cumulative annual growth rate in our Net Service Revenues as defined in the incentive plan over three -year performance periods. Depending on the results achieved, the actual number of shares to be granted may range from 0% to 200% of the target shares. Compensation expense is recognized ratably over the vesting period based on the probability of the number of awards expected to vest at each reporting date. Unvested restricted stock units are forfeited if the employee ceases to be employed by us prior to vesting. The following table summarizes RSU and PSU activity under our equity-based plans for the year ended December 31, 2016 : RSUs PSUs Number of Units Weighted-Average Grant Date Fair Value Number of Units Weighted-Average Grant Date Fair Value Nonvested at December 31, 2015 956,687 $ 28.03 173,286 $ 33.51 Granted 2,281,998 18.25 — — Vested (695,253 ) 23.52 — — Forfeited (220,381 ) 22.29 (23,874 ) 33.51 Nonvested at December 31, 2016 2,323,051 $ 20.32 149,412 $ 33.51 Year Ended December 31, Additional Disclosures for RSUs 2016 2015 2014 Total grant date fair value of RSUs granted (in millions) $ 41.7 $ 31.2 N/A Total grant date fair value of RSUs vested (in millions) $ 16.4 $ 3.5 $ 0.1 Shares withheld to settle payroll tax liabilities related to vesting of RSUs held by employees 217,769 35,379 80,599 Employee Stock Purchase Plan Our 2014 Employee Stock Purchase plan (ESPP) offers eligible employees an option to purchase shares of our common stock through a payroll deduction. The purchase price is equal to the lesser of 85% of the fair market value of our common stock on the offering date or 85% of the fair market value of our common stock on the applicable purchase date. Offering periods are approximately six months in duration and will end on or about May 15 and November 15 of each year. Employees may contribute a minimum of 1% and a maximum of 15% of their earnings. The plan is considered to be a compensatory plan. We issued 283,644 , 272,836 , and 249,494 shares under the ESPP during 2016 , 2015 and 2014 , respectively. As of December 31, 2016 , 1.7 million shares were reserved for future issuances under the ESPP. Stock-Based Compensation The fair value of our RSUs and PSUs is equal to the fair value of our common stock on the grant date. The fair value of stock options and the ESPP is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: Stock Option Assumptions ESPP Assumptions Year Ended December 31, Expected Term (in Years) Expected Volatility Risk-Free Interest Rate Expected Dividend Yield Expected Term (in Years) Expected Volatility Risk-Free Interest Rate Expected Dividend Yield 2016 N/A N/A N/A N/A 0.50 32-76% 0.33-0.62% 0 % 2015 6.08 39 % 1.73 % 0 % 0.50 34-76% 0.07-0.33% 0 % 2014 6.05 58 % 1.80 % 0 % 0.50 33-58% 0.06-0.07% 0 % Compensation expense is measured based on the fair value of the stock option on the grant date and recognized over the requisite service period for each separately vesting portion of the stock option award. Stock-based compensation expense and other disclosures for stock-based awards made to our employees pursuant to the equity plans was as follows: Year Ended December 31, (In thousands) 2016 2015 2014 Cost of providing services $ 6,607 $ 4,244 $ 2,658 Sales and marketing 6,573 4,490 2,755 General and administrative 10,831 7,501 4,517 Systems development and programming costs 2,486 1,688 1,030 Total stock-based compensation expense $ 26,497 $ 17,923 $ 10,960 Income tax benefit related to stock-based compensation expense $ 9,142 $ 5,678 $ 2,040 Actual tax benefit realized from stock options exercise $ 7,076 $ 19,609 $ 13,514 The table below summarizes unrecognized compensation expense, net of forfeitures for the year ended December 31, 2016 associated with the following: Amount (in thousands) Weighted-Average Period (in Years) Nonvested stock options $ 5,739 1.41 Nonvested RSUs $ 42,198 2.70 Nonvested PSUs $ 374 1.00 Stock Repurchases During 2016, 2015, and 2014, the board of directors authorized $100 million , $50 million and $45 million , respectively of outstanding common stock to be repurchased with no expiration from the date of authorization. As of December 31, 2016 , approximately $60.0 million remained available for repurchase pursuant to our stock repurchase program. During 2016 , 2015 and 2014 , we repurchased 3,414,675 shares, 1,895,625 shares and 490,419 shares, respectively. |
Earnings Per Share (EPS)
Earnings Per Share (EPS) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share (EPS) | EARNINGS PER SHARE (EPS) Basic EPS is computed based on the weighted average number of common stocks outstanding during the period. Diluted EPS is computed based on those shares used in the basic EPS computation, plus potentially dilutive shares issuable under our equity-based compensation plans using the treasury stock method. Shares that are potentially anti-dilutive are excluded. In 2014, we had convertible preferred stock which were participating securities. Basic EPS was computed using the two-class method that earnings were allocated between common stock and participating preferred stock. Diluted EPS is computed using the more dilutive of the if-converted method and two-class method. The convertible preferred stock was converted into common stock as a result of our IPO. The following table presents the computation of our basic and diluted EPS attributable to our common stock: Year Ended December 31, (In thousands, except per share data) 2016 2015 2014 Numerator (basic) Net income $ 61,406 $ 31,695 $ 15,497 Less net income allocated to participating securities — — (2,224 ) Net income attributable to common stock $ 61,406 $ 31,695 $ 13,273 Denominator (basic) Weighted average shares of common stock outstanding 70,160 70,228 56,161 Basic EPS $ 0.88 $ 0.45 $ 0.24 Numerator (diluted) Net income $ 61,406 $ 31,695 $ 15,497 Less net income allocated to participating securities — — (2,114 ) Net income attributable to common stock $ 61,406 $ 31,695 $ 13,383 Denominator (diluted) Weighted average shares of common stock 70,160 70,228 56,161 Dilutive effect of stock options and restricted stock units 1,812 2,390 3,406 Weighted average shares of common stock outstanding 71,972 72,618 59,567 Diluted EPS $ 0.85 $ 0.44 $ 0.22 Common stock equivalents excluded from income per diluted share because of their anti-dilutive effect 871 1,004 526 |
401(k) Plan
401(k) Plan | 12 Months Ended |
Dec. 31, 2016 | |
Postemployment Benefits [Abstract] | |
401(k) PLAN | 401(k) PLAN Under our 401(k) plan, corporate participants may direct the investment of contributions to their accounts among certain investments. We match individual employee 401(k) plan contributions at the rate of $0.50 for every dollar contributed by employees subject to a cap. We recorded matching contributions to the 401(k) plan of $5.1 million , $4.6 million , and $3.5 million during the years ended December 31, 2016 , 2015 , and 2014 , respectively, which are reflected in various operating expense lines within the accompanying consolidated statements of income. We also maintain multiple employer defined contribution plans, which cover WSEs for client companies electing to participate in the plan and for their internal staff employees. We contribute, on behalf of each participating client, varying amounts based on the clients’ policies and serviced employee elections. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Provision for Income Taxes The provision for income taxes consists of the following: Year Ended December 31, (In thousands) 2016 2015 2014 Current: Federal $ 1,488 $ 9,189 $ (31,111 ) State (364 ) 3,794 4,618 Foreign 150 378 230 1,274 13,361 (26,263 ) Deferred: Federal 38,028 11,528 38,297 State 4,278 320 2,951 Foreign (6 ) (24 ) — Revaluation due to state legislative changes (528 ) 3,130 2,594 41,772 14,954 43,842 Total $ 43,046 $ 28,315 $ 17,579 The U.S. federal statutory income tax rate reconciled to our effective tax rate is as follows: Year Ended December 31, 2016 2015 2014 (In thousands, except percent) Pre-Tax Income Tax Expense/(Benefit) Percent of Pre-Tax Income (Loss) Pre-Tax Income Tax Expense/(Benefit) Percent of Pre-Tax Income (Loss) Pre-Tax Income Tax Expense/(Benefit) Percent of Pre-Tax Income (Loss) $ 104,452 $ 60,010 $ 33,076 U.S. federal statutory tax rate $ 36,558 35.0 % $ 21,004 35.0 % $ 11,577 35.0 % State income taxes, net of federal benefit 4,484 4.2 3,961 6.6 1,257 3.8 Tax rate change (528 ) (0.5 ) 3,130 5.2 2,594 7.8 Nondeductible transaction costs — — — — 305 0.9 Nondeductible meals, entertainment and penalties 4,129 4.0 1,970 3.3 1,412 4.3 Stock-based compensation 634 0.6 816 1.3 1,478 4.5 Uncertain tax positions 23 — 98 0.2 268 0.8 Tax credits (1,228 ) (1.2 ) (1,340 ) (2.2 ) (1,202 ) (3.6 ) Net Operating Loss adjustment — — (932 ) (1.5 ) — — State tax return to provision adjustment (1,267 ) (1.2 ) — — — — Other 241 0.3 (392 ) (0.7 ) (110 ) (0.3 ) Total $ 43,046 41.2 % $ 28,315 47.2 % $ 17,579 53.2 % Our effective income tax rate decreased by 6.0% from 47.2% in 2015 to 41.2% in 2016 . The change was primarily attributed to a decrease in state income taxes from income that is excluded for state income tax purposes and dilution of the negative rate impact from permanent items due to an increase in pre-tax earnings. In 2015 , the revaluation of deferred taxes from state legislative changes resulted in a charge to income tax of $3.1 million compared to the state tax benefit from such revaluation of $0.5 million in 2016 . Further, a discrete benefit of $1.3 million resulting in a tax rate benefit of 1.2% was recorded in 2016 associated with reduced state income tax expense in prior years arising from state return to provision paid for workers' compensation insurance. The revaluation of deferred taxes resulted in discrete tax (benefit)/expense representing (0.5)% , 5.2% and 7.8% of the effective tax rate for the years ended December 31, 2016 , 2015 and 2014 , respectively. Deferred Income Taxes Significant components of our deferred tax assets and liabilities are as follows: Year Ended December 31, (In thousands) 2016 2015 Deferred tax assets: Net operating losses (federal and state) $ 4,397 $ 2,508 Accrued expenses 10,239 9,908 Accrued workers' compensation costs 13,266 18,823 Stock-based compensation 5,350 4,643 Tax benefits relating to uncertain positions 37 29 Tax credits (federal and state) 6,344 6,272 Other (47 ) 113 Total 39,586 42,296 Valuation allowance (5,689 ) (5,276 ) Total deferred tax assets 33,897 37,020 Deferred tax liabilities: Depreciation and amortization (8,055 ) (3,277 ) Deferred service revenues (114,646 ) (85,263 ) Prepaid health plan expenses (3,569 ) (3,121 ) Total deferred tax liabilities (126,270 ) (91,661 ) Net non-current deferred tax liabilities $ (92,373 ) $ (54,641 ) We recorded an additional $0.4 million of valuation allowance from $5.3 million in 2015 to $5.7 million in 2016 , related to certain state net operating loss carryforwards generated in current year that may not be utilized prior to expiration. We have de minimis federal net operating loss carryforwards and $95.5 million multiple state net operating loss carryforwards as of December 31, 2016 . The federal net operating loss carryforward will begin expiring in 2031 and the state net operating loss carryforward will begin expiring in 2017 . We have excluded excess windfall tax benefits resulting from stock option exercises as components of our gross state deferred tax assets, as tax attributes related to such windfall tax benefits should not be recognized until they result in a reduction of state taxes payable. The gross amount of unrealized state net operating loss carryforwards resulting from stock option exercises was $13.1 million at December 31, 2016 . When realized, excess windfall tax benefits are credited to additional paid-in capital. The provision for income taxes for the year ended December 31, 2016 included $4.7 million of excess tax benefits resulting from stock option exercises and net operating loss carryforward utilization. We follow the tax law ordering method to determine when such net operating loss carryforwards have been realized. We have $6.5 million (net of federal benefit) state tax credit carryforwards available that will begin expiring in 2021 , which are partially offset by a valuation allowance of $4.7 million as of December 31, 2016 and 2015 . We are subject to tax in U.S. federal and various state and local jurisdictions, as well as Canada. We are not subject to any material income tax examinations in federal or state jurisdictions for tax years prior to January 1, 2011. We paid Notices of Proposed Assessments disallowing employment tax credits totaling $10.5 million , plus interest and penalties of $4.0 million in connection with the IRS examination of Gevity HR, Inc. and its subsidiaries, which was acquired by TriNet in June 2009. This issue is being resolved through litigation. With regard to these employment tax credits, we believe it is more likely than not that we will prevail and realize our receivable included in other noncurrent assets without a charge to our statement of income. Therefore, no reserve has been recognized related to this matter. We have not provided for U.S. federal income and foreign withholding taxes on our Canadian subsidiary’s undistributed earnings of $2.7 million as of December 31, 2016 , because we intend to reinvest such earnings indefinitely. Upon distribution of those earnings in the form of dividends or otherwise, we would be subject to U.S. income taxes (subject to an adjustment for foreign tax credits). Determining the unrecognized deferred tax liability related to our investment in our Canadian subsidiary that are indefinitely reinvested is not practicable. Uncertain Tax Positions As of December 31, 2016 and 2015 , the total unrecognized tax benefits related to uncertain income tax positions, which would affect the effective tax rate if recognized, were $0.6 million and $3.3 million , respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and penalties) is as follows: Year Ended December 31, (In thousands) 2016 2015 2014 Unrecognized tax benefits at January 1 $ 2,618 $ 2,471 $ 2,300 Additions for tax positions of prior periods — — 25 Additions for tax positions of current period 132 167 182 Reductions for tax positions of prior period: Settlements with taxing authorities (1,855 ) — — Lapse of applicable statute of limitations (130 ) — — Adjustments to tax positions (15 ) (20 ) (36 ) Unrecognized tax benefits at December 31 $ 750 $ 2,618 $ 2,471 As of December 31, 2016 and 2015 , the total amount of gross interest and penalties accrued was $0.8 million . Accrued interest and penalties are included in other liabilities on the consolidated balance sheet. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Lease Commitments We lease office facilities, including our headquarters and other facilities under non-cancelable operating leases. The schedule of minimum future rental payments under non-cancelable operating leases having initial terms in excess of one year at December 31, 2016 , is as follows: (In thousands) Operating Leases Year ending December 31: 2017 $ 15,274 2018 13,809 2019 11,840 2020 11,334 2021 5,505 Thereafter 6,882 Minimum lease payments $ 64,644 The lease agreements generally provide for rental payments on a graduated basis and for options to renew, which could increase future minimum lease payments if exercised. We recognize rent expense on a straight-line basis over the lease period and accrue for rent expense incurred but not paid. Rent expense for the years ended December 31, 2016 , 2015 and 2014 was $16.7 million , $12.9 million and $11.9 million , respectively. Standby Letters of Credit We have two standby letters of credit up to an aggregate of $17.8 million provided as collateral for our workers’ compensation obligations. At December 31, 2016 , the facilities were not drawn down. Contingencies In August 2015, Howard Welgus, a purported stockholder filed a putative securities class action lawsuit, Welgus v. TriNet Group, Inc. et. al., under the Securities Exchange Act of 1934 in the United States District Court (the Court) for the Northern District of California. The complaint was later amended in April 2016. The amended complaint generally alleges that TriNet and the other defendants caused damage to purchasers of our stock by misrepresenting and/or failing to disclose facts generally pertaining to alleged trends affecting health insurance and workers' compensation claims. The other defendants include certain of our officers and directors, General Atlantic, LLC, a former significant shareholder, and the underwriters of our IPO. In November 2016, the parties appeared at a hearing before the Court on our motion to dismiss the amended complaint in its entirety. In January 2017, the Court issued an order granting TriNet’s and the other defendants’ motions to dismiss. The Court dismissed the plaintiff’s claims in part with prejudice and in part without. As a result, the Court has given the plaintiff until March 3, 2017 to file a second amended complaint with respect to claims not dismissed with prejudice. If the plaintiff chooses not to file a second amended complaint, the case will be dismissed with prejudice and a final judgment will be entered. We are unable to reasonably estimate the possible loss or range of losses, if any, arising from this litigation. We are and, from time to time, have been and may in the future become involved in various litigation matters, legal proceedings and claims arising in the ordinary course of its business, including disputes with our clients or various class action, collective action, representative action and other proceedings arising from the nature of our co-employment relationship with our clients and WSEs in which we are named as a defendant. In addition, due to the nature of our co-employment relationship with our clients and WSEs, we could be subject to liability for federal and state law violations, even if we do not participate in such violations. While our agreements with our clients contain indemnification provisions related to the conduct of our clients, we may not be able to avail ourselves of such provisions in every instance. We have accrued our current best estimates of probable losses with respect to these matters which are individually and in aggregate immaterial to our consolidated financial statements. While the outcome of the matters described above cannot be predicted with certainty, management currently does not believe that any such claims or proceedings or the above mentioned securities class action will have a materially adverse effect on our consolidated financial position, results of operations or cash flows. However, the unfavorable resolution of any particular matter or our reassessment of our exposure for any of the above matters based on additional information obtained in the future could have a material impact on our consolidated financial position, results of operations or cash flows. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS We have service agreements with certain stockholders that we process their employees' payrolls and payroll taxes. From time to time, we also enter into sales and purchases agreements with various companies that have a relationship with our executive officers or members of our board of directors. The relationships are typically an equity investment by the executive officer or board member in the customer / vendor company or our executive officer or board member is a member of the customer / vendor company's board of directors. We have received $10.2 million , $6.1 million , and $3.9 million in total revenues from such related parties during the years ended December 31, 2016 , 2015 and 2014 , respectively. We have also entered into various software license agreements with software service providers who have board members in common with us. We paid the software service providers $7.1 million , $4.1 million , and $5.9 million during the years ended December 31, 2016 , 2015 and 2014 , for services we received, respectively. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | QUARTERLY FINANCIAL DATA (UNAUDITED) Quarter ended (In thousands, except per share data) March 31 June 30 September 30 December 31 2016 Total revenues $ 732,939 $ 745,846 $ 770,457 $ 811,071 Insurance costs 569,689 596,673 609,422 637,968 Operating income 25,902 26,367 28,972 42,717 Net income 11,577 12,282 14,581 22,966 Basic net income per share $ 0.16 $ 0.17 $ 0.21 $ 0.34 Diluted net income per share $ 0.16 $ 0.17 $ 0.20 $ 0.32 2015 Total revenues $ 625,578 $ 640,007 $ 668,008 $ 725,695 Insurance costs 483,203 517,994 534,481 576,698 Operating income 31,041 5,985 11,682 29,609 Net income (loss) 15,811 (1,308 ) 3,097 14,095 Basic net income (loss) per share $ 0.23 $ (0.02 ) $ 0.04 $ 0.20 Diluted net income (loss) per share $ 0.22 $ (0.02 ) $ 0.04 $ 0.20 |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS Balance at Credited/ Charges Balance at Beginning of Charged to Utilized/ End of (in thousands) Period Net Income Write-Offs Period Allowances for Doubtful Accounts and Authorized Credits Year ended December 31, 2016 $ 1,158 1,418 (2,284 ) $ 292 Year ended December 31, 2015 $ 388 2,085 (1,315 ) $ 1,158 Year ended December 31, 2014 $ 865 947 (1,424 ) $ 388 Tax Valuation Allowance Year ended December 31, 2016 $ 5,276 413 — $ 5,689 Year ended December 31, 2015 $ 6,945 — (1,669 ) $ 5,276 Year ended December 31, 2014 $ 5,194 1,751 — $ 6,945 |
Description of Business and S24
Description of Business and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Segment Information | We operate in one reportable segment. All of our service revenues are generated from external clients. Less than 1% of revenue is generated outside of the U.S. |
Basis of Presentation | Basis of Presentation Our consolidated financial statements are prepared in conformity with generally accepted accounting principles (GAAP) in the United States of America. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect certain reported amounts and related disclosures. Significant estimates include: • liability for unpaid losses and loss adjustment expenses (loss reserves) related to workers' compensation and workers' compensation collateral receivable, • health insurance loss reserves, • liability for insurance premiums payable, • impairments of goodwill and other intangible assets, • income tax assets and liabilities, and • liability for legal contingencies. These estimates are based on historical experience and on various other assumptions that we believe to be reasonable from the facts available to us. Some of the assumptions are highly uncertain at the time of estimation. To the extent actual experience differs from the assumptions used, our consolidated financial statements could be materially affected. |
Revenue Recognition | Revenue Recognition Professional service revenues represent fees charged to clients for processing payroll-related transactions on behalf of our clients, access to our HR expertise, employment and benefit law compliance services and other HR related services. Professional service revenues are recognized in the period the services are rendered and earned under service arrangements with clients, where service fees are fixed or determinable, and collectability is reasonably assured. Under the accounting rules, we are not considered the primary obligor with respect to WSEs payroll and payroll tax payments and therefore, these payments are not reflected as either revenue or expense in our consolidated statements of income. The gross payroll and payroll tax payments made on behalf of our clients, combined, were $34.3 billion , $30.6 billion and $25.6 billion for the years ended December 31, 2016 , 2015 , and 2014 , respectively. We generally charge an upfront non-refundable set-up fee which is recognized on a straight-line basis over the estimated average client tenure. Insurance service revenues consist of insurance-related billings and administrative fees collected from clients and withheld from WSEs for workers' compensation insurance and health benefit insurance plans provided by third-party insurance carriers. Insurance service revenues are recognized in the period amounts are due and where collectability is reasonably assured. The professional service revenues and insurance service revenues are each considered separate units of accounting for administrative services and insurance related benefits billed to the majority of our clients. For clients billed through a bundled invoice, the selling price of significant deliverables is determined based on the best estimate of the selling price. |
Insurance Costs | Insurance Costs Our fully-insured insurance plans are provided by third-party insurance carriers under guaranteed-cost or risk-based insurance policies. Under guaranteed-cost policies, our carriers establish the premiums and we are not responsible for any deductibles. Under risk-based policies, we agree to reimburse our carriers for any claims paid within an agreed-upon deductible layer. Insurance costs include insurance premiums for coverage provided by insurance carriers, reimbursement of claims payments made by insurance carriers or third-party administrators, and changes in loss reserves related to our workers' compensation and health benefit insurance. At policy inception, annual workers' compensation premiums are estimated based on projected wages over the duration of the policy period and the risk categories of the WSEs. As actual wages are realized, the amounts paid for premiums may differ from the estimates that we recorded, creating an asset or liability throughout the policy year. Such asset or liability is reported on our consolidated balance sheets as prepaid insurance premiums or insurance premiums payable, respectively. |
Workers Compensation & Health Benefits Loss Reserves | Workers' Compensation Loss Reserves We have secured fully-insured insurance policies with insurance carriers for our clients and WSEs that obligate us to reimburse the insurance carriers for losses up to $1 million per claim occurrence (deductible layer). Workers' compensation insurance reserves represent our liability for unpaid losses and loss adjustment expenses. These reserves are established to provide for the estimated ultimate costs of paying claims within the deductible layer in accordance with worker's compensation insurance policies. These reserves include estimates for reported and incurred but not reported (IBNR) losses, and expenses associated with processing and settling the claims. In establishing these reserves, we use an independent actuary to provide an estimate of undiscounted future cash payments that would be made to settle the claims based upon: • TriNet's historical loss experience, exposure data, and industry loss experience, • inputs including WSE job responsibilities and location, • historical frequency and severity of workers' compensation claims, • an estimate of future cost trends to establish expected loss ratios for subsequent accident years, • expected loss ratios for the latest accident year or prior accident years, adjusted for the loss trend, the effect of rate changes and other quantifiable factors, and • loss development factors to project the reported losses for each accident year to an ultimate basis. We assess the workers' compensation loss reserves on a quarterly basis. For each reporting period, changes in the actuarial methods and assumptions resulting from changes in actual claims experience and other trends are incorporated into the workers' compensation loss reserves. Adjustments to previously established reserves are reflected in the results of operations for the period in which the adjustment is identified. Such adjustments could be significant, reflecting any variety of new and adverse or favorable trends. Accordingly, final claim settlements may vary materially from the present estimates, particularly when those payments may not occur until well into the future. In our experience, plan years related to workers' compensation programs may take ten years or more to be settled. We do not discount workers' compensation loss reserves. Claim costs expected to be paid within one year are recorded as workers' compensation reserves included in short-term WSE related liabilities. Claim costs expected to be paid beyond one year are included in long-term liabilities. Insurance carriers are responsible for administering and paying claims. We are responsible for reimbursing each carrier up to a deductible limit per occurrence. We have collateral agreements with various insurance carriers where either we retain custody of funds in trust accounts which we record as restricted cash and cash equivalents, or remit funds to carriers. Collateral whether held by us, or the carriers, is used to settle our insurance and claim deductible obligations to them. Collateral is calculated by policy year and remains restricted until the policy year is fully settled. Collateral paid to carriers, by agreement permits net settlement of obligations against collateral held, which we record net of our loss reserves (Carrier Collateral Offset). Any excess funds held by carriers over our recorded loss reserves by policy year can be returned to us based on the agreements with them. Based on the estimated timing of return, such excess funds are recorded as workers' compensation collateral receivable, in WSE related assets or in long-term assets. Health Benefits Loss Reserves We sponsor and administer a number of fully-insured, risk based employee benefit plans, including group health, dental, and vision as an employer plan sponsor under section 3(5) of the Employee Retirement Income Security Act (ERISA). Approximately 38% of our 2016 group health insurance premiums were for guaranteed-cost policies which are fully-insured policies where we are not responsible for any deductible. The remaining 62% by premium of our 2016 policies relate to fully-insured policies where we reimburse our health insurers for claims incurred within a per person deductible layer up to a maximum aggregate exposure limit per policy. These deductible dollar limits and maximum limits vary by carrier and year. Health benefits loss reserves are established to provide for the estimated unpaid costs of reimbursing the carriers for paying claims within the deductible layer in accordance with health insurance policies. These reserves include estimates for reported losses, plus estimates for claims incurred but not paid. We assess reserves regularly based upon independent actuarial studies that include other relevant factors such as current and historical claims payment patterns, plan enrollment and medical trend rates. Under certain policies, based on plan performance, we may be entitled to receive refunds of premiums which we recognize in accordance with the policy terms. We estimate these refunds based on premium and claims data and record as a reduction in the insurance costs on the consolidated statements of income and prepaid health plan expenses in WSE related assets on the consolidated balance sheets. As of December 31, 2016 and 2015 , we had $8.6 million and $6.8 million , respectively, included within WSE related assets as prepaid insurance premiums. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include bank deposits and short-term, highly liquid investments. Investments with original maturity dates of three months or less are considered cash equivalents. |
Restricted Cash, Restricted Cash and Investments | Restricted Cash, Cash Equivalents and Investments Restricted cash and cash equivalents presented on our consolidated balance sheets represents our corporate cash and cash equivalents in trust accounts functioning as security deposits for our insurance carriers. These deposits are not used for settling insurance premiums or claims payments. WSE related assets also includes restricted cash, cash equivalents and investments held in trust for current and future premium and claim obligations with our insurance carriers. Amounts are held in trust according to the terms of the relevant insurance policies and by the local insurance regulations of the jurisdictions in which the policies are in force. |
Investments | Investments We have investments primarily in marketable securities including U.S. treasuries, which are classified as available for sale and are carried at estimated fair value. Unrealized gains and losses are reported as a component of accumulated other comprehensive income (loss), net of deferred income taxes. The amortized cost of marketable securities is adjusted for amortization of premiums and accretion of discounts from the date of purchase to maturity or sale. Such amortization is included in interest income as an addition to or deduction from the coupon interest earned on the investments. We use the specific identification method to determine the realized gains and losses on the sale of available for sale securities. Realized gains and losses are included in other income in the accompanying consolidated statements of income. We assess our investments for an other-than-temporary impairment loss due to a decline in fair value or other market conditions. We review several factors to determine whether a loss is other than temporary, such as the length and extent of the fair value decline, the financial condition and near-term prospects of the issuer and whether we have the intent to sell or will more likely than not be required to sell before the securities' anticipated recovery, which may be at maturity. If management determines that a security is impaired under these circumstances, the impairment recognized in earnings is measured as the entire difference between the amortized cost and the then-current fair value. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. Our financial assets recorded at fair value on a recurring basis are comprised of available for sale marketable securities and certificates of deposits. We measure certain financial assets at fair value for disclosure purposes, as well as on a nonrecurring basis when they are deemed to be other-than-temporarily impaired. Our other current financial assets and our other current financial liabilities, including cash and cash equivalents, restricted cash and cash equivalents, WSE related assets and liabilities excluding insurance loss reserves, line of credit and accrued corporate wages, have fair values that approximate their carrying value due to their short-term nature. Assets and liabilities recorded at fair value are measured and classified in accordance with a three-tier fair value hierarchy based on the observability of the inputs available in the market to measure fair value, summarized as follows: • Level I—observable inputs for identical assets or liabilities, such as quoted prices in active markets, • Level II—inputs other than the quoted prices in active markets that are observable either directly or indirectly, • Level III—unobservable inputs in which there is little or no market data, which requires that we develop our own assumptions. The fair value hierarchy requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. We classify our cash equivalents, debt securities and notes payable in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement in its entirety. |
WSE related Assets and Liabilities | WSE related Assets and Liabilities Current assets and liabilities resulted from transactions directly or indirectly associated with WSEs, including payroll and related taxes and withholdings, our sponsored workers' compensation and health insurance programs, and other benefit programs, are reported in WSE related assets and liabilities on the consolidated balance sheets. These assets and liabilities are reported separately from our corporate assets and liabilities to better distinguish our corporate position from those assets and liabilities held by us to fund client payrolls. |
Unbilled Revenue | Unbilled Revenue We recognize WSE payroll and payroll tax liabilities in the period in which the WSEs perform work. When clients' pay periods cross reporting periods, we accrue the portion of the unpaid WSE payroll and the corresponding payroll tax liabilities associated with the work performed prior to period-end. These estimated payroll and payroll taxes liabilities as accrued wages in WSE related liabilities. The associated receivables, including estimated revenues, offset by advance collections from clients, are recorded as unbilled revenues in WSE related assets. |
Accounts Receivable | Accounts Receivable Our accounts receivable recorded in WSE related assets, represent outstanding gross billings to clients, net of an allowance for doubtful accounts. We establish an allowance for doubtful accounts based on historical experience, the age of the accounts receivable balances, credit quality of clients, current economic conditions and other factors that may affect clients’ ability to pay, and charge-off amounts when they are deemed uncollectible. |
Property and Equipment | Property and Equipment We record property and equipment at historical cost and compute depreciation using the straight-line method over the estimated useful lives of the assets or the lease terms, generally three to five years for software and office equipment, five to seven years for furniture and fixtures, and the shorter of the asset life or the remaining lease term for leasehold improvements. We expense the cost of maintenance and repairs as incurred and capitalize leasehold improvements. |
Internal Use Software | We capitalize internal and external costs incurred to develop internal-use computer software during the application development stage. Application development stage costs include license fees paid to third-parties for software use, software configuration, coding, and installation. Capitalized costs are amortized on a straight-line basis over the estimated useful life, typically ranging from three to five years, commencing when the software is placed into service. We expense costs incurred during the preliminary project stage, as well as general and administrative, overhead, maintenance and training costs, and costs that do not add functionality to existing systems. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Our goodwill and identifiable intangible assets with indefinite useful lives are not amortized, but are tested for impairment on an annual basis or when an event occurs or circumstances change in a way to indicate that there has been a potential decline in the fair value of the reporting unit. Goodwill impairment is determined by comparing the estimated fair value of the reporting unit to its carrying amount, including goodwill. Our business is largely homogeneous and, as a result, all goodwill is associated with one reporting unit within our reportable segment. Annually, we perform a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit has declined below carrying value. This assessment considers various financial, macroeconomic, industry, and reporting unit specific qualitative factors. We perform our annual impairment testing in the fourth quarter. Based on the results of our reviews, no impairment loss was recognized in the results of operations for the years ended December 31, 2016 , 2015 and 2014 . Intangible assets with finite useful lives are amortized over their respective estimated useful lives ranging from two to ten years using either the straight-line method or an accelerated method. Intangible assets are reviewed for indicators of impairment at least annually and evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Based on the results of our reviews, no impairment loss was recognized in the results of operations for the years ended December 31, 2016 , 2015 and 2014 . |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We evaluate our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is considered impaired if the carrying amount exceeds the undiscounted future net cash flows the asset is expected to generate. An impairment charge is recognized for the amount by which the carrying amount of the assets exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less selling costs. |
Advertising Costs | Advertising Costs We expense the costs of producing advertisements at the time production occurs, and expense the cost of running advertisements in the period in which the advertising space or airtime is used as sales and marketing expense. |
Stock-Based Compensation | Stock-Based Compensation We have three types of stock-based awards to employees: restricted stock units (time based and performance based), stock options and an employee stock purchase plan. Compensation expense associated with restricted stock units is based on the fair value of common stock on the date of grant. Compensation expense associated with stock options and employee stock purchase plan are based on the estimated grant date fair value method using the Black-Scholes option pricing model. Expense is recognized using a straight-line amortization method over the respective vesting period for awards that are ultimately expected to vest. Accordingly, stock-based compensation has been reduced for estimated forfeitures. When estimating forfeitures, we consider voluntary termination behavior as well as trends of actual forfeitures. A tax benefit from stock-based compensation is recognized in additional paid in capital to the extent that an incremental tax benefit is realized. |
Income Taxes | Income Taxes We account for our provision for income taxes using the asset and liability method, under which we recognize income taxes payable or refundable for current year and deferred tax assets and liabilities for future tax effect of events that have been recognized in our financial statements or tax returns. We measure our current and deferred tax assets and liabilities based on provision of enacted tax laws of those jurisdictions in which we operate. The effect of changes in tax laws and regulations, or interpretations, is recognized in our consolidated financial statements in the period that includes the enactment date. We recognize deferred tax assets and liabilities based on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and amounts used for income tax purposes, as well as the expected benefits of using net operating loss and other carryforwards. We are required to establish a valuation allowance when it is determined more likely than not that the deferred tax assets will not be realized. Provision for income taxes may change when estimates used in determining valuation allowances change or when receipt of new information indicates the need for adjustment in valuation allowances. Changes in valuation allowances are reflected as a component of provision for income taxes in the period the change is enacted. We recognize a reserve for uncertain tax positions taken or expected to be taken in a tax return when it is concluded that tax positions are not more likely than not to be sustained upon examination by taxing authorities, including resolution of any related appeals or litigation processes, based on the technical merits of the positions. Assumptions, judgment and the use of estimates are required in determining if the more likely than not standard has been met when developing the provision for income taxes and in determining the expected benefit. The tax benefits of the position recognized in the financial statements are then measured based on the largest amount of benefit that is greater than 50% likely to be realized upon settlement with a taxing authority. Unrecognized tax benefits due to tax uncertainties that do not meet the minimum probability threshold are included as other liabilities and are charged to earnings in the period that such determination is made. We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. Accrued interest and penalties are included in other liabilities on the consolidated balance sheet. |
Concentration of Credit Risk | Concentrations of Credit Risk Financial instruments subject to concentrations of credit risk include cash, cash equivalents and investments (including payroll funds collected), accounts receivable, and amounts due from insurance carriers. We maintain these financial assets principally in domestic financial institutions. We perform periodic evaluations of the relative credit standing of these institutions. Our exposure to credit risk in the event of default by the financial institutions holding these funds is limited to amounts currently held by the institution in excess of insured amounts. Under the terms of professional services agreements, clients agree to maintain sufficient funds or other satisfactory credit at all times to cover the cost of their current payroll, all accrued paid time off, vacation or sick leave balances, and other vested wage and benefit obligations for all their work site employees. We generally require payment from our clients on or before the applicable payroll date. For certain clients, we require an indemnity guarantee payment (IGP) supported by a letter of credit, bond, or a certificate of deposit from certain financial institutions. The IGP typically equals the total payroll and service fee for one average payroll period. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently adopted accounting guidance Debt issuance costs - In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03- Simplifying the Presentation of Debt Issuance Costs, and, in August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements. These ASUs require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt, which is consistent with the presentation of debt discounts and premiums. The presentation and subsequent measurement of debt issuance costs associated with lines of credit, may be presented as an asset and amortized ratably over the term of the line of credit arrangement, regardless of whether there are outstanding borrowings on the arrangement. The recognition and measurement guidance for debt issuance costs are not affected by these ASUs. We adopted these ASUs as of March 31, 2016. The adoption of these ASUs resulted in a reclassification of unamortized debt issuance costs of $2.4 million from other current assets to current portion of notes and capital leases payable and $3.4 million from other assets to notes and capital leases payable, less current portion, as of December 31, 2015. Unamortized debt issuance costs related to our revolving credit facility will remain classified within other assets in the accompanying consolidated balance sheets. The adoption of this guidance did not have any impact on our consolidated statements of income, comprehensive income or cash flows. Recent issued accounting pronouncements Lease arrangements - In February 2016, the FASB, issued ASU 2016-02- Leases. The amendment requires that lease arrangements longer than 12 months result in an entity recognizing lease assets and lease liabilities. Most significant impact is on those leases classified as operating leases under previous U.S. GAAP. Under the new standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The amendment is effective for annual reporting periods, and interim periods within those years beginning after December 15, 2018. Early adoption is permitted, the new standard will be effective for us beginning January 1, 2018. We will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. We currently anticipate early adoption of the new standard effective January 1, 2018 in conjunction with our adoption of the new revenue standard. Our ability to early adopt is dependent on system readiness and the completion of our analysis of information necessary to restate prior period financial statements. As of December 31, 2016, we had a total of $64.6 million non-cancelable operating lease commitments. We anticipate this standard will have a material impact on our consolidated financial statements. While we are continuing to assess all potential impacts of the standard, we currently believe the most significant impact relates to our accounting for equipment, office and data-center operating leases. Financial Instruments - In January 2016, the FASB issued ASU 2016-01- Recognition and Measurement of Financial Assets and Financial Liabilities . The amendment addresses various aspects of the recognition, measurement, presentation, and disclosure for financial instruments. The amendment is effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Early adoption by public entities is permitted only for certain provisions. We are currently in the process of evaluating the impact of the adoption of this standard on our consolidated financial statements. Revenue Recognition - In May 2014, the FASB issued ASU 2014-09- Revenue from Contracts with Customers , which will replace most existing revenue recognition guidance under GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard provides a five-step analysis of transactions to determine when and how revenue is recognized. In July 2015, the FASB deferred the effective date to annual reporting periods, and interim periods within those years, beginning after December 15, 2017. Early adoption at the original effective date of December 15, 2016 is permitted. The amendments may be applied retrospectively or as a cumulative-effect adjustment as of the date of adoption. In March, April and May 2016, the FASB issued ASU 2016-08 Principal versus Agent Considerations (Reporting Revenue Gross versus Net), ASU 2016-10 Identifying Performance Obligations and Licensing, ASU 2016-12 Narrow-Scope Improvements and Practical Expedients and ASU 2016-20 Technical Corrections and Improvements, respectively, providing further clarification to be considered when implementing ASU 2014-09. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). We currently anticipate adopting the standard using the full retrospective method to restate each prior reporting period presented. The new standard will be effective for us beginning January 1, 2018. Our ability to adopt using the full retrospective method is dependent on system readiness and the completion of our analysis of information necessary to restate prior period financial statements. We anticipate this standard will have a material impact on our consolidated financial statements. While we are continuing to assess all potential impacts of the standard, we currently believe the adoption will have material impact on our accounting for sales commission expense, income tax provision and deferred taxes. We anticipate that certain client acquisition costs will be deferred over the expected client tenure. Additionally, we are assessing whether it remains appropriate to accrue assets and liabilities for unprocessed client payrolls where WSEs have performed work during the period. We expect our professional service revenues and insurance service revenues remain substantially unchanged. The actual revenue recognition treatment required under the standard will be dependent on contract-specific terms, and may vary in some instances from recognition at the time of billing. Share-based payments - In March 2016, the FASB issued ASU 2016-09- Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , as part of the Simplification Initiative. Under this standard, among other changes, income tax benefits and deficiencies with respect to stock-based compensation will be recognized as income tax expense or benefit in the income statement, excess tax benefits will be classified as an operating activity on the statement of cash flows and stock-based compensation awards can qualify as equity awards even if the entity permits tax withholdings greater than the statutory minimum. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period. We will adopt the guidance effective January 1, 2017. The adoption of ASU 2016-09 is expected to impact income taxes expenses on our 2017 consolidated statements of income and the operating and financing cash flows on the consolidated statements of cash flows. The magnitude of such impacts are dependent upon our future grants of stock-based compensation, the stock price in relation to the fair value of awards on grant date, and the exercise behavior of the equity compensation holders. The Company will retrospectively adopt the presentation in the consolidated statements of cash flows, resulting in $4.6 million and $20.7 million increase in operating cash flows and decrease in financing cash flows for the years ended December 31, 2016 and 2015, respectively. We expect the remaining adjustments will not have a material effect on our consolidated financial statements. Statement of Cash Flows - In November and August 2016, the FASB issued (ASU) 2016-18 - Statement of Cash Flows (Topic 230): Restricted Cash and 2016-15- Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The new guidance is intended to reduce diversity in practice in how restricted cash and other certain transactions are classified in the statement of cash flows. The amendments are effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Early adoption is permitted, provided that all of the amendments are adopted in the same period. The guidance requires application using a retrospective transition method. As of December 31, 2016 and 2015 , we had total restricted cash, restricted cash equivalents and payroll funds collected of $1.0 billion . Currently, changes in these balances are presented as operating cash activities in the consolidated statements of cash flows. Under the new guidance, changes in these amounts will be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the consolidated statements of cash flows. |
Cash, Cash Equivalents and In25
Cash, Cash Equivalents and Investments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash, Cash Equivalents and Investments | Our total corporate and WSE related cash, cash equivalents and investments are summarized below: December 31, 2016 December 31, 2015 (In thousands) Cash and cash equivalents Available for sale marketable securities Certificate of deposits Total Cash and cash equivalents Available for sale marketable securities Certificate of deposits Total Cash and cash equivalents $ 184,004 $ — $ — $ 184,004 $ 166,178 $ — $ — $ 166,178 Restricted cash and cash equivalents 14,569 14,569 14,557 14,557 Restricted cash, cash equivalents and investments, noncurrent Collateral for workers' compensation claims 78,672 51,829 — 130,501 38,711 63,095 — 101,806 Worksite employee related assets Restricted cash, cash equivalents and investments, current Collateral for health benefits claims 65,022 — — 65,022 46,980 — — 46,980 Collateral for workers' compensation claims 64,773 64,773 45,937 1,500 47,437 Investments — — 2,320 2,320 — — 2,319 2,319 Total WSE related restricted cash, cash equivalents and investments, current 129,795 — 2,320 132,115 92,917 1,500 2,319 96,736 Payroll funds collected 825,958 — — 825,958 859,322 — — 859,322 Total $ 1,232,998 $ 51,829 $ 2,320 $ 1,287,147 $ 1,171,685 $ 64,595 $ 2,319 $ 1,238,599 |
Worksite Employee Related Ass26
Worksite Employee Related Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Industries [Abstract] | |
Schedule of Components of the Company's WSE-Related Assets and WSE-Related Liabilities | (In thousands) December 31, 2016 December 31, 2015 Worksite employee related assets: Restricted cash, cash equivalents and investments $ 132,115 $ 96,736 Payroll funds collected 825,958 859,322 Unbilled revenues (net of advance collections of $8,602 and $11,875 at December 31, 2016 and 2015, respectively) 293,192 213,837 Accounts receivable (net of allowance for doubtful accounts of $292 and $1,158 at December 31, 2016 and 2015, respectively) 4,854 5,060 Prepaid insurance premiums 12,805 8,832 Workers' compensation collateral receivable 2,136 2,428 Other payroll assets 10,411 187,171 Total worksite employee related assets $ 1,281,471 $ 1,373,386 Worksite employee related liabilities: Accrued wages $ 272,966 $ 202,396 Client deposits 56,182 57,758 Payroll tax liabilities 692,460 883,608 Unpaid losses and loss adjustment expenses (less than 1 year): Health benefits loss reserves 129,430 112,658 Workers' compensation loss reserves (net of collateral paid of $9,234 and $11,761 at December 31, 2016 and 2015, respectively) 63,702 57,731 Insurance premiums and other payables 14,223 23,813 Other payroll withholdings 47,032 31,533 Total worksite employee related liabilities $ 1,275,995 $ 1,369,497 |
Workers' Compensation Loss Re27
Workers' Compensation Loss Reserves (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Insurance [Abstract] | |
Summary of Activities in Liability for Unpaid Claims and Claims Adjustment Expenses | The following summarizes the activities in the consolidated balance sheets for unpaid claims and claims adjustment expenses within workers' compensation assets and liabilities: Year Ended December 31, (in thousands) 2016 2015 2014 Total loss reserves, beginning of year $ 190,102 $ 148,034 $ 120,739 Incurred Current year 112,967 89,137 63,377 Prior years 28,243 26,391 15,401 Total incurred 141,210 115,528 78,778 Paid Current year (14,411 ) (16,376 ) (13,086 ) Prior years (62,287 ) (57,084 ) (38,397 ) Total paid (76,698 ) (73,460 ) (51,483 ) Total loss reserves, end of year $ 254,614 $ 190,102 $ 148,034 Collateral paid to carriers and offset against loss reserves (31,611 ) (26,890 ) (55,492 ) Total loss reserves, net of carrier collateral offset $ 223,003 $ 163,212 $ 92,542 Payable in less than 1 year (1) (net of collateral paid to carriers of $9,234, $11,761 and $10,275 as of December 31, 2016, 2015 and 2014, respectively) 63,702 57,731 17,094 Payable in more than 1 year (net of collateral paid to carriers of $22,377, $15,129 and $45,217 as of December 31, 2016, 2015 and 2014, respectively) 159,301 105,481 75,448 Workers' Compensation Loss Reserves $ 223,003 $ 163,212 $ 92,542 (1) Included under WSE related liabilities within Note 3 to these consolidated financial statements. |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and equipment, net, consists of the following: (In thousands) December 31, 2016 December 31, 2015 Software $ 88,161 $ 64,727 Office equipment, including data processing equipment 20,974 20,044 Leasehold improvements 11,785 9,874 Furniture, fixtures, and equipment 11,421 7,911 Projects in progress 10,714 7,407 Total 143,055 109,963 Less: Accumulated depreciation (84,433 ) (72,119 ) Property and equipment, net $ 58,622 $ 37,844 |
Goodwill and Other Intangible29
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill and Other Intangible Assets | The following summarizes goodwill and other intangible assets: December 31, 2016 December 31, 2015 (In thousands) Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Goodwill $ 289,207 $ — $ 289,207 $ 289,207 $ — $ 289,207 Amortizable intangibles: Customer contracts 10 years 209,850 (182,168 ) 27,682 209,850 (167,968 ) 41,882 Trademark 3 years 16,900 (16,900 ) — 16,900 (16,467 ) 433 Developed technology 5 years 5,700 (2,308 ) 3,392 5,400 (1,173 ) 4,227 Noncompete agreements 3 years 1,940 (1,940 ) — 1,940 (1,710 ) 230 Total $ 234,390 $ (203,316 ) $ 31,074 $ 234,090 $ (187,318 ) $ 46,772 |
Schedule of Expected Amortization Expense Related to Amortizable Intangibles in Future Periods | Expense related to intangibles amortization in future periods as of December 31, 2016 is expected to be as follows: Year ending December 31: Amount (in thousands) 2017 $ 5,265 2018 5,199 2019 5,199 2020 4,759 2021 and thereafter 10,652 Total $ 31,074 |
Financial Instruments And Fai30
Financial Instruments And Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Available-for-Sale Marketable Securities | The following table summarizes our investments by significant categories and fair value measurement on a recurring basis as of December 31, 2016 and 2015 : (In thousands) Maturity (in years) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value December 31, 2016 Level 1: Investments: U.S. treasuries < 3 $ 51,376 $ 25 $ (77 ) $ 51,324 Mutual funds N/A 500 5 — 505 Total investments $ 51,876 $ 30 $ (77 ) $ 51,829 Level 2: Certificates of deposit < 1 $ 2,320 $ — $ — 2,320 Total $ 54,149 December 31, 2015 Level 1: Investments U.S. treasuries < 4 $ 64,226 $ 9 $ (144 ) $ 64,091 Mutual funds N/A 500 4 — 504 Total investments $ 64,726 $ 13 $ (144 ) $ 64,595 Level 2: Certificates of deposit < 1 $ 2,319 $ — $ — $ 2,319 Total $ 66,914 |
Notes Payable and Capital Lea31
Notes Payable and Capital Leases Payable (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Line of Credit Facility [Abstract] | |
Components of Company's Notes Payable and Borrowings under Capital Leases Balances | As of December 31, 2016 , notes and capital leases payable consisted of the following: (In thousands) December 31, December 31, Annual Effective Interest Rate Maturity Term loan A $ 330,469 $ 351,563 3.250 % (1) 3.46 % July 2019 Term loan B — 148,000 3.220 % (2) N/A July 2017 Term loan A-2 132,469 — 3.125 % (3) 3.29 % July 2019 Total term loans 462,938 499,563 Deferred loan costs (4,018 ) (5,781 ) Capital leases 134 153 Less: current portion (36,559 ) (32,970 ) Non-current term portion $ 422,495 $ 460,965 (1) Bears interest at LIBOR plus 2.25% or the prime rate plus 1.25% at our option, subject to certain rate adjustments based upon our total leverage ratio. (2) Contractual interest rate in place at June 30, 2016, prior to the refinancing in July 2016. (3) Bears interest at LIBOR plus 2.125% or the prime rate plus 1.125% at our option, subject to certain rate adjustments based upon our total leverage ratio. |
Schedule of Maturities of Long-term Debt | The tranche A and A-2 term loans will be repaid in quarterly installments in aggregate annual amounts as follows (in thousands): Year ending December 31, 2017 2018 2019 Total Term loan repayments $ 38,250 $ 41,438 $ 383,250 $ 462,938 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Summary of Stock Option Activity under the Company's Equity-Based Plans | The following table summarizes stock option activity under our equity-based plans for the year ended December 31, 2016 : Number Weighted Weighted Aggregate Balance at December 31, 2015 4,446,149 $ 8.96 7.56 $ 52,108 Granted — — Exercised (1,297,812 ) 4.06 Forfeited (261,029 ) 17.53 Expired (72,084 ) 27.01 Balance at December 31, 2016 2,815,224 $ 9.96 6.66 $ 46,231 Exercisable at December 31, 2016 2,014,443 $ 8.00 6.42 $ 36,459 Vested and expected to vest at December 31, 2016 2,775,326 $ 9.83 6.65 $ 45,865 |
Schedule of Other Share-based Compensation Activity | Year Ended December 31, Additional Disclosures for RSUs 2016 2015 2014 Total grant date fair value of RSUs granted (in millions) $ 41.7 $ 31.2 N/A Total grant date fair value of RSUs vested (in millions) $ 16.4 $ 3.5 $ 0.1 Shares withheld to settle payroll tax liabilities related to vesting of RSUs held by employees 217,769 35,379 80,599 Year Ended December 31, Additional Disclosures for Stock Options 2016 2015 2014 Weighted-average grant date fair value of stock options N/A $ 12.73 $ 7.18 Total fair value of options vested (in millions) $ 6.8 $ 12.2 $ 7.5 Total intrinsic value of options exercised (in millions) $ 20.5 $ 53.3 $ 35.1 Cash received from options exercised (in millions) $ 5.3 $ 7.3 $ 2.2 |
Summary of Restricted Stock Unit Activity under the Company's Equity-Based Plans | The following table summarizes RSU and PSU activity under our equity-based plans for the year ended December 31, 2016 : RSUs PSUs Number of Units Weighted-Average Grant Date Fair Value Number of Units Weighted-Average Grant Date Fair Value Nonvested at December 31, 2015 956,687 $ 28.03 173,286 $ 33.51 Granted 2,281,998 18.25 — — Vested (695,253 ) 23.52 — — Forfeited (220,381 ) 22.29 (23,874 ) 33.51 Nonvested at December 31, 2016 2,323,051 $ 20.32 149,412 $ 33.51 |
Summary of Performance Based Restricted Stock Unit Activity | The following table summarizes RSU and PSU activity under our equity-based plans for the year ended December 31, 2016 : RSUs PSUs Number of Units Weighted-Average Grant Date Fair Value Number of Units Weighted-Average Grant Date Fair Value Nonvested at December 31, 2015 956,687 $ 28.03 173,286 $ 33.51 Granted 2,281,998 18.25 — — Vested (695,253 ) 23.52 — — Forfeited (220,381 ) 22.29 (23,874 ) 33.51 Nonvested at December 31, 2016 2,323,051 $ 20.32 149,412 $ 33.51 |
Summary of Significant Assumptions Used to Estimate Fair Value of Stock Options under Black-Scholes Model | The fair value of stock options and the ESPP is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: Stock Option Assumptions ESPP Assumptions Year Ended December 31, Expected Term (in Years) Expected Volatility Risk-Free Interest Rate Expected Dividend Yield Expected Term (in Years) Expected Volatility Risk-Free Interest Rate Expected Dividend Yield 2016 N/A N/A N/A N/A 0.50 32-76% 0.33-0.62% 0 % 2015 6.08 39 % 1.73 % 0 % 0.50 34-76% 0.07-0.33% 0 % 2014 6.05 58 % 1.80 % 0 % 0.50 33-58% 0.06-0.07% 0 % |
Summary of Significant Assumptions Used to Estimate Fair Value of Employee Stock Purchase Plans under Black-Scholes Model | The fair value of stock options and the ESPP is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: Stock Option Assumptions ESPP Assumptions Year Ended December 31, Expected Term (in Years) Expected Volatility Risk-Free Interest Rate Expected Dividend Yield Expected Term (in Years) Expected Volatility Risk-Free Interest Rate Expected Dividend Yield 2016 N/A N/A N/A N/A 0.50 32-76% 0.33-0.62% 0 % 2015 6.08 39 % 1.73 % 0 % 0.50 34-76% 0.07-0.33% 0 % 2014 6.05 58 % 1.80 % 0 % 0.50 33-58% 0.06-0.07% 0 % |
Summary of Stock-based Compensation Expense | Stock-based compensation expense and other disclosures for stock-based awards made to our employees pursuant to the equity plans was as follows: Year Ended December 31, (In thousands) 2016 2015 2014 Cost of providing services $ 6,607 $ 4,244 $ 2,658 Sales and marketing 6,573 4,490 2,755 General and administrative 10,831 7,501 4,517 Systems development and programming costs 2,486 1,688 1,030 Total stock-based compensation expense $ 26,497 $ 17,923 $ 10,960 Income tax benefit related to stock-based compensation expense $ 9,142 $ 5,678 $ 2,040 Actual tax benefit realized from stock options exercise $ 7,076 $ 19,609 $ 13,514 |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan | The table below summarizes unrecognized compensation expense, net of forfeitures for the year ended December 31, 2016 associated with the following: Amount (in thousands) Weighted-Average Period (in Years) Nonvested stock options $ 5,739 1.41 Nonvested RSUs $ 42,198 2.70 Nonvested PSUs $ 374 1.00 |
Earnings Per Share (EPS) (Table
Earnings Per Share (EPS) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The following table presents the computation of our basic and diluted EPS attributable to our common stock: Year Ended December 31, (In thousands, except per share data) 2016 2015 2014 Numerator (basic) Net income $ 61,406 $ 31,695 $ 15,497 Less net income allocated to participating securities — — (2,224 ) Net income attributable to common stock $ 61,406 $ 31,695 $ 13,273 Denominator (basic) Weighted average shares of common stock outstanding 70,160 70,228 56,161 Basic EPS $ 0.88 $ 0.45 $ 0.24 Numerator (diluted) Net income $ 61,406 $ 31,695 $ 15,497 Less net income allocated to participating securities — — (2,114 ) Net income attributable to common stock $ 61,406 $ 31,695 $ 13,383 Denominator (diluted) Weighted average shares of common stock 70,160 70,228 56,161 Dilutive effect of stock options and restricted stock units 1,812 2,390 3,406 Weighted average shares of common stock outstanding 71,972 72,618 59,567 Diluted EPS $ 0.85 $ 0.44 $ 0.22 Common stock equivalents excluded from income per diluted share because of their anti-dilutive effect 871 1,004 526 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | The provision for income taxes consists of the following: Year Ended December 31, (In thousands) 2016 2015 2014 Current: Federal $ 1,488 $ 9,189 $ (31,111 ) State (364 ) 3,794 4,618 Foreign 150 378 230 1,274 13,361 (26,263 ) Deferred: Federal 38,028 11,528 38,297 State 4,278 320 2,951 Foreign (6 ) (24 ) — Revaluation due to state legislative changes (528 ) 3,130 2,594 41,772 14,954 43,842 Total $ 43,046 $ 28,315 $ 17,579 |
U.S. Federal Statutory Income Tax Rate Reconciled to Effective Tax Rate | The U.S. federal statutory income tax rate reconciled to our effective tax rate is as follows: Year Ended December 31, 2016 2015 2014 (In thousands, except percent) Pre-Tax Income Tax Expense/(Benefit) Percent of Pre-Tax Income (Loss) Pre-Tax Income Tax Expense/(Benefit) Percent of Pre-Tax Income (Loss) Pre-Tax Income Tax Expense/(Benefit) Percent of Pre-Tax Income (Loss) $ 104,452 $ 60,010 $ 33,076 U.S. federal statutory tax rate $ 36,558 35.0 % $ 21,004 35.0 % $ 11,577 35.0 % State income taxes, net of federal benefit 4,484 4.2 3,961 6.6 1,257 3.8 Tax rate change (528 ) (0.5 ) 3,130 5.2 2,594 7.8 Nondeductible transaction costs — — — — 305 0.9 Nondeductible meals, entertainment and penalties 4,129 4.0 1,970 3.3 1,412 4.3 Stock-based compensation 634 0.6 816 1.3 1,478 4.5 Uncertain tax positions 23 — 98 0.2 268 0.8 Tax credits (1,228 ) (1.2 ) (1,340 ) (2.2 ) (1,202 ) (3.6 ) Net Operating Loss adjustment — — (932 ) (1.5 ) — — State tax return to provision adjustment (1,267 ) (1.2 ) — — — — Other 241 0.3 (392 ) (0.7 ) (110 ) (0.3 ) Total $ 43,046 41.2 % $ 28,315 47.2 % $ 17,579 53.2 % |
Significant Components of Company's Deferred Tax Assets and Liabilities | Significant components of our deferred tax assets and liabilities are as follows: Year Ended December 31, (In thousands) 2016 2015 Deferred tax assets: Net operating losses (federal and state) $ 4,397 $ 2,508 Accrued expenses 10,239 9,908 Accrued workers' compensation costs 13,266 18,823 Stock-based compensation 5,350 4,643 Tax benefits relating to uncertain positions 37 29 Tax credits (federal and state) 6,344 6,272 Other (47 ) 113 Total 39,586 42,296 Valuation allowance (5,689 ) (5,276 ) Total deferred tax assets 33,897 37,020 Deferred tax liabilities: Depreciation and amortization (8,055 ) (3,277 ) Deferred service revenues (114,646 ) (85,263 ) Prepaid health plan expenses (3,569 ) (3,121 ) Total deferred tax liabilities (126,270 ) (91,661 ) Net non-current deferred tax liabilities $ (92,373 ) $ (54,641 ) |
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and penalties) is as follows: Year Ended December 31, (In thousands) 2016 2015 2014 Unrecognized tax benefits at January 1 $ 2,618 $ 2,471 $ 2,300 Additions for tax positions of prior periods — — 25 Additions for tax positions of current period 132 167 182 Reductions for tax positions of prior period: Settlements with taxing authorities (1,855 ) — — Lapse of applicable statute of limitations (130 ) — — Adjustments to tax positions (15 ) (20 ) (36 ) Unrecognized tax benefits at December 31 $ 750 $ 2,618 $ 2,471 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual Obligation, Fiscal Year Maturity Schedule | The schedule of minimum future rental payments under non-cancelable operating leases having initial terms in excess of one year at December 31, 2016 , is as follows: (In thousands) Operating Leases Year ending December 31: 2017 $ 15,274 2018 13,809 2019 11,840 2020 11,334 2021 5,505 Thereafter 6,882 Minimum lease payments $ 64,644 |
Quarterly Financial Data (Una36
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Quarterly Financial Data | Quarter ended (In thousands, except per share data) March 31 June 30 September 30 December 31 2016 Total revenues $ 732,939 $ 745,846 $ 770,457 $ 811,071 Insurance costs 569,689 596,673 609,422 637,968 Operating income 25,902 26,367 28,972 42,717 Net income 11,577 12,282 14,581 22,966 Basic net income per share $ 0.16 $ 0.17 $ 0.21 $ 0.34 Diluted net income per share $ 0.16 $ 0.17 $ 0.20 $ 0.32 2015 Total revenues $ 625,578 $ 640,007 $ 668,008 $ 725,695 Insurance costs 483,203 517,994 534,481 576,698 Operating income 31,041 5,985 11,682 29,609 Net income (loss) 15,811 (1,308 ) 3,097 14,095 Basic net income (loss) per share $ 0.23 $ (0.02 ) $ 0.04 $ 0.20 Diluted net income (loss) per share $ 0.22 $ (0.02 ) $ 0.04 $ 0.20 |
Description of Business and S37
Description of Business and Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2016USD ($)segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Summary Of Significant Accounting Policy [Line Items] | |||
Number of reportable segments as result of acquisitions | segment | 1 | ||
Gross payroll and payroll tax payments made | $ 34,300,000,000 | $ 30,600,000,000 | $ 25,600,000,000 |
Reimbursement per claim occurrence (up to) | $ 1,000,000 | ||
Plan years to be settled (in years) | 10 years | ||
Prepaid insurance premiums | $ 8,600,000 | 6,800,000 | |
Internally developed software costs | 21,300,000 | 11,200,000 | 6,300,000 |
Impairment loss | 0 | 0 | 0 |
Impairment of intangible assets (excluding goodwill) | 0 | 0 | 0 |
Advertising costs | 6,400,000 | 8,200,000 | 7,300,000 |
Bad debt expense, net of recoveries | 1,300,000 | 2,000,000 | 1,400,000 |
Debt issuance costs | 4,018,000 | 5,781,000 | |
Non-cancelable operating lease commitments | 64,644,000 | ||
Net cash provided by operating activities | 144,532,000 | 130,599,000 | 151,899,000 |
Net cash used in financing activities | (99,371,000) | (60,752,000) | $ (66,372,000) |
Restricted cash, cash equivalents and payroll funds collected | $ 1,000,000,000 | $ 1,000,000,000 | |
Customer Concentration Risk | Accounts Receivable | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Concentration risk, percentage | 12.00% | ||
Minimum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Useful life of finite-lived intangible assets | 2 years | ||
Maximum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Useful life of finite-lived intangible assets | 10 years | ||
Maximum | Geographic Concentration Risk | Sales revenue, net | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Concentration risk, percentage | 1.00% | ||
Software And Office Equipment | Minimum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Estimated useful life | 3 years | ||
Software And Office Equipment | Maximum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Estimated useful life | 5 years | ||
Furniture, fixtures, and equipment | Minimum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Estimated useful life | 5 years | ||
Furniture, fixtures, and equipment | Maximum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Estimated useful life | 7 years | ||
Software Development | Minimum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Useful life of finite-lived intangible assets | 3 years | ||
Software Development | Maximum | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Useful life of finite-lived intangible assets | 5 years | ||
Accounting Standards Update 2015-03 | Notes and Capital Leases Payable, Current | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Debt issuance costs | $ 2,400,000 | ||
Accounting Standards Update 2015-03 | Notes and Capital Leases Payable, Noncurrent | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Debt issuance costs | 3,400,000 | ||
Accounting Standards Update 2015-03 | Other Current Assets | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Debt issuance costs | (2,400,000) | ||
Accounting Standards Update 2015-03 | Other Assets | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Debt issuance costs | (3,400,000) | ||
New Accounting Pronouncement, Early Adoption, Effect | Accounting Standards Update 2016-09 | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Net cash provided by operating activities | $ 4,600,000 | 20,700,000 | |
Net cash used in financing activities | $ (4,600,000) | $ (20,700,000) | |
Guaranteed Cost | Product Concentration Risk | Sales Revenue, Services, Net | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Concentration risk, percentage | 38.00% | ||
Risk-Based | Product Concentration Risk | |||
Summary Of Significant Accounting Policy [Line Items] | |||
Concentration risk, percentage | 62.00% |
Cash, Cash Equivalents and In38
Cash, Cash Equivalents and Investments - Components of Cash, Cash Equivalents and Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Cash and cash equivalents | $ 184,004 | $ 166,178 | $ 134,341 | $ 94,356 |
Restricted cash and cash equivalents | 14,569 | 14,557 | ||
Restricted cash and investments, noncurrent | 130,501 | 101,806 | ||
Restricted cash and investments, current | 132,115 | 96,736 | ||
Payroll funds collected | 825,958 | 859,322 | ||
Restricted cash and investments | 1,287,147 | 1,238,599 | ||
Cash and cash equivalents | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Cash and cash equivalents | 184,004 | 166,178 | ||
Restricted cash and cash equivalents | 14,569 | 14,557 | ||
Restricted cash and investments, noncurrent | 78,672 | 38,711 | ||
Restricted cash and investments, current | 129,795 | 92,917 | ||
Payroll funds collected | 825,958 | 859,322 | ||
Restricted cash and investments | 1,232,998 | 1,171,685 | ||
Available for sale marketable securities | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, noncurrent | 51,829 | 63,095 | ||
Restricted cash and investments, current | 0 | 1,500 | ||
Restricted cash and investments | 51,829 | 64,595 | ||
Certificate of deposits | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | 2,320 | 2,319 | ||
Restricted cash and investments | 2,320 | 2,319 | ||
Health Benefit Claims | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | 65,022 | 46,980 | ||
Health Benefit Claims | Cash and cash equivalents | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | 65,022 | 46,980 | ||
Workers' Compensation Claims | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | 64,773 | 47,437 | ||
Workers' Compensation Claims | Cash and cash equivalents | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | 64,773 | 45,937 | ||
Workers' Compensation Claims | Available for sale marketable securities | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | 1,500 | |||
Investment Type Collateral | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash and investments, current | $ 2,320 | $ 2,319 |
Worksite Employee Related Ass39
Worksite Employee Related Assets and Liabilities - Schedule of Components of the Company's WSE-Related Assets and WSE-Related Liabilities (Details) $ in Thousands | Dec. 31, 2016USD ($)employee | Dec. 31, 2015USD ($)employee | Dec. 31, 2014USD ($) |
Other Industries [Abstract] | |||
Entity number of employees | employee | 2,600 | 2,500 | |
Worksite employee related assets: | |||
Restricted cash, cash equivalents and investments | $ 1,287,147 | $ 1,238,599 | |
Payroll funds collected | 825,958 | 859,322 | |
Prepaid insurance premiums | 8,600 | 6,800 | |
Workers' compensation collateral receivable | 31,883 | 29,204 | |
Total worksite employee related assets | 1,281,471 | 1,373,386 | |
Worksite employee related liabilities: | |||
Total worksite employee related liabilities | 1,275,995 | 1,369,497 | |
WSE | |||
Worksite employee related assets: | |||
Restricted cash, cash equivalents and investments | 132,115 | 96,736 | |
Payroll funds collected | 825,958 | 859,322 | |
Unbilled revenues (net of advance collections of $8,602 and $11,875 at December 31, 2016 and 2015, respectively) | 293,192 | 213,837 | |
Accounts receivable (net of allowance for doubtful accounts of $292 and $1,158 at December 31, 2016 and 2015, respectively) | 4,854 | 5,060 | |
Prepaid insurance premiums | 12,805 | 8,832 | |
Workers' compensation collateral receivable | 2,136 | 2,428 | |
Other payroll assets | 10,411 | 187,171 | |
Total worksite employee related assets | 1,281,471 | 1,373,386 | |
Advance collection | 8,602 | 11,875 | |
Allowance for doubtful accounts | 292 | 1,158 | |
Worksite employee related liabilities: | |||
Accrued wages | 272,966 | 202,396 | |
Client deposits | 56,182 | 57,758 | |
Payroll tax liabilities | 692,460 | 883,608 | |
Health benefits loss reserves | 129,430 | 112,658 | |
Workers' compensation loss reserves (net of collateral paid of $9,234 and $11,761 at December 31, 2016 and 2015, respectively) | 63,702 | 57,731 | $ 17,094 |
Collateral paid to insurance carriers, net of workers' compensation loss reserves, current | 9,234 | 11,761 | $ 10,275 |
Insurance premiums and other payables | 14,223 | 23,813 | |
Other payroll withholdings | 47,032 | 31,533 | |
Total worksite employee related liabilities | $ 1,275,995 | 1,369,497 | |
Customer One | WSE | |||
Worksite employee related assets: | |||
Payroll funds collected | $ 181,000 |
Workers' Compensation Loss Re40
Workers' Compensation Loss Reserves - Summary of Activities in Liability for Unpaid Claims and Claims Adjustment Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Liability for Unpaid Claims and Claims Adjustment Expense | |||
Liability for unpaid claims and claims adjustment at beginning of period | $ 190,102 | $ 148,034 | $ 120,739 |
Incurred | |||
Current year | 112,967 | 89,137 | 63,377 |
Prior years | 28,243 | 26,391 | 15,401 |
Total incurred | 141,210 | 115,528 | 78,778 |
Paid | |||
Current year | (14,411) | (16,376) | (13,086) |
Prior years | (62,287) | (57,084) | (38,397) |
Total paid | (76,698) | (73,460) | (51,483) |
Liability for unpaid claims and claims adjustment at end of period | 254,614 | 190,102 | 148,034 |
Collateral paid to carriers and offset against loss reserves | (31,611) | (26,890) | (55,492) |
Payable in more than 1 year (net of collateral paid to carriers of $22,377, $15,129 and $45,217 as of December 31, 2016, 2015 and 2014, respectively) | 159,301 | 105,481 | |
Workers' Compensation Loss Reserves | 223,003 | 163,212 | 92,542 |
Collateral paid to insurance carriers, net of workers' compensation loss reserves, noncurrent | 22,377 | 15,129 | |
WSE | |||
Paid | |||
Payable in less than 1 year (net of collateral paid to carriers of $9,234, $11,761 and $10,275 as of December 31, 2016, 2015 and 2014, respectively) | 63,702 | 57,731 | 17,094 |
Payable in more than 1 year (net of collateral paid to carriers of $22,377, $15,129 and $45,217 as of December 31, 2016, 2015 and 2014, respectively) | 159,301 | 105,481 | 75,448 |
Workers' Compensation Loss Reserves | 223,003 | 163,212 | 92,542 |
Collateral paid to insurance carriers, net of workers' compensation loss reserves, current | 9,234 | 11,761 | 10,275 |
Collateral paid to insurance carriers, net of workers' compensation loss reserves, noncurrent | $ 22,377 | $ 15,129 | $ 45,217 |
Workers' Compensation Assets an
Workers' Compensation Assets and Claim Liabilities - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Insurance [Abstract] | |||
Collateral held by insurance carriers | $ 65,600 | $ 58,500 | $ 95,400 |
Collateral paid to carriers and offset against loss reserves | $ (31,611) | $ (26,890) | $ (55,492) |
Property and Equipment, Net - P
Property and Equipment, Net - Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 143,055 | $ 109,963 |
Less: Accumulated depreciation | (84,433) | (72,119) |
Property and equipment, net | 58,622 | 37,844 |
Software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 88,161 | 64,727 |
Office equipment, including data processing equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 20,974 | 20,044 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 11,785 | 9,874 |
Furniture, fixtures, and equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 11,421 | 7,911 |
Projects in progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 10,714 | $ 7,407 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property Plant And Equipment [Line Items] | |||
Depreciation | $ 19,351 | $ 14,612 | $ 13,843 |
Internally developed software | |||
Property Plant And Equipment [Line Items] | |||
Depreciation | $ 10,200 | $ 5,400 | $ 5,200 |
Goodwill And Other Intangible44
Goodwill And Other Intangible Assets - Schedule of Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | Oct. 01, 2016 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill, Gross Carrying Amount | $ 289,207 | $ 289,207 | ||
Goodwill, Net Carrying Amount | 289,207 | 289,207 | ||
Other Intangible Assets, Gross Carrying Amount | 234,390 | 234,090 | ||
Other Intangible Assets, Accumulated Amortization | (203,316) | (187,318) | ||
Other Intangible Assets, Net Carrying Amount | $ 31,074 | 46,772 | ||
Customer Contracts | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Other Intangible Assets, Weighted Average Amortization Period | 10 years | 5 years | 10 years | |
Other Intangible Assets, Gross Carrying Amount | $ 209,850 | 209,850 | ||
Other Intangible Assets, Accumulated Amortization | (182,168) | (167,968) | ||
Other Intangible Assets, Net Carrying Amount | $ 27,682 | 41,882 | ||
Trademarks | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Other Intangible Assets, Weighted Average Amortization Period | 3 years | |||
Other Intangible Assets, Gross Carrying Amount | $ 16,900 | 16,900 | ||
Other Intangible Assets, Accumulated Amortization | (16,900) | (16,467) | ||
Other Intangible Assets, Net Carrying Amount | $ 0 | 433 | ||
Developed technology | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Other Intangible Assets, Weighted Average Amortization Period | 5 years | |||
Other Intangible Assets, Gross Carrying Amount | $ 5,700 | 5,400 | ||
Other Intangible Assets, Accumulated Amortization | (2,308) | (1,173) | ||
Other Intangible Assets, Net Carrying Amount | $ 3,392 | 4,227 | ||
Non-compete Agreements | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Other Intangible Assets, Weighted Average Amortization Period | 3 years | |||
Other Intangible Assets, Gross Carrying Amount | $ 1,940 | 1,940 | ||
Other Intangible Assets, Accumulated Amortization | (1,940) | (1,710) | ||
Other Intangible Assets, Net Carrying Amount | $ 0 | $ 230 |
Goodwill And Other Intangible45
Goodwill And Other Intangible Assets - Schedule of Expected Amortization Expense Related to Amortizable Intangibles in Future Periods (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
2,017 | $ 5,265 | |
2,018 | 5,199 | |
2,019 | 5,199 | |
2,020 | 4,759 | |
2021 and thereafter | 10,652 | |
Other Intangible Assets, Net Carrying Amount | $ 31,074 | $ 46,772 |
Financial Instruments And Fai46
Financial Instruments And Fair Value Measurements - Summary of Available-for-Sale Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule Of Available For Sale Securities [Line Items] | ||
Fair value of financial instuments owned, total | $ 54,149 | $ 66,914 |
U.S. treasuries | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Contractual maturity (less than) | 3 years | 4 years |
Certificates of deposit | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Contractual maturity (less than) | 1 year | 1 year |
Level I | U.S. treasuries | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | $ 51,376 | $ 64,226 |
Gross Unrealized Gains | 25 | 9 |
Gross Unrealized Losses | (77) | (144) |
Estimated Fair Value | 51,324 | 64,091 |
Level I | Mutual funds | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 500 | 500 |
Gross Unrealized Gains | 5 | 4 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 505 | 504 |
Level I | U.S. Treasuries & Mutual Funds | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 51,876 | 64,726 |
Gross Unrealized Gains | 30 | 13 |
Gross Unrealized Losses | (77) | (144) |
Estimated Fair Value | 51,829 | 64,595 |
Level II | Certificates of deposit | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 2,320 | 2,319 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | $ 2,320 | $ 2,319 |
Financial Instruments And Fai47
Financial Instruments And Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Percentage of total fair value of available for sale securities in unrealized loss position | 58.00% | 81.00% |
U.S. treasuries | Level I | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Gross Unrealized Losses | $ (77) | $ (144) |
Reported Value Measurement | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Notes payable | 462,900 | 499,600 |
Estimate of Fair Value | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Notes payable | $ 462,900 | $ 499,600 |
Notes Payable and Capital Lea48
Notes Payable and Capital Leases Payable - Components of Company's Notes Payable and Borrowings under Capital Leases Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | |
Line of Credit Facility [Line Items] | |||
Term loans | $ 462,938 | $ 499,563 | |
Deferred loan costs | (4,018) | (5,781) | |
Capital leases | 134 | 153 | |
Less: current portion | (36,559) | (32,970) | |
Non-current term portion | 422,495 | 460,965 | |
First lien credit facility | Tranche A term loans | |||
Line of Credit Facility [Line Items] | |||
Term loans | $ 330,469 | 351,563 | |
Annual Contractual Interest Rate | 3.25% | ||
Effective Interest Rate | 3.46% | ||
First lien credit facility | Tranche B term loans | |||
Line of Credit Facility [Line Items] | |||
Term loans | $ 0 | 148,000 | |
Annual Contractual Interest Rate | 3.22% | ||
Loans Payable | Tranche A-2 Term Loans | |||
Line of Credit Facility [Line Items] | |||
Term loans | $ 132,469 | $ 0 | |
Annual Contractual Interest Rate | 3.125% | ||
Effective Interest Rate | 3.29% | ||
LIBOR | First lien credit facility | Tranche A term loans | |||
Line of Credit Facility [Line Items] | |||
Margin for term loans | 2.25% | ||
LIBOR | Loans Payable | Tranche A-2 Term Loans | |||
Line of Credit Facility [Line Items] | |||
Margin for term loans | 2.125% | ||
Prime lending rate | First lien credit facility | Tranche A term loans | |||
Line of Credit Facility [Line Items] | |||
Margin for term loans | 1.25% | ||
Prime lending rate | Loans Payable | Tranche A-2 Term Loans | |||
Line of Credit Facility [Line Items] | |||
Margin for term loans | 1.125% |
Notes Payable and Capital Lea49
Notes Payable and Capital Leases Payable - Additional Information (Details) | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015 | |
Minimum | |||
Debt Instrument [Line Items] | |||
Debt instrument covenant interest coverage ratio | 3.50 | 3.50 | |
Maximum | |||
Debt Instrument [Line Items] | |||
Debt instrument covenant leverage ratio | 4.25 | 4.25 | |
First lien credit facility | |||
Debt Instrument [Line Items] | |||
Debt issuance costs incurred | $ 1,400,000 | ||
Debt issuance costs, gross | 800,000 | ||
First lien credit facility | Tranche A term loans | |||
Debt Instrument [Line Items] | |||
Term loan | 342,000,000 | ||
First lien credit facility | Tranche B term loans | |||
Debt Instrument [Line Items] | |||
Extinguishment of debt | 57,600,000 | ||
First lien credit facility | Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Line of credit facility | 75,000,000 | $ 75,000,000 | |
Commitment fee percentage | 0.50% | ||
Unused portion of facility | $ 59,500,000 | ||
First lien credit facility | Revolving credit facility | Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.375% | ||
First lien credit facility | Letter of Credit | |||
Debt Instrument [Line Items] | |||
Line of credit facility | $ 40,000,000 | ||
First lien credit facility | Swingline | |||
Debt Instrument [Line Items] | |||
Line of credit facility | $ 10,000,000 | ||
Loans Payable | Tranche B term loans | |||
Debt Instrument [Line Items] | |||
Term loan | 135,000,000 | ||
Loans Payable | Tranche A-2 Term Loans | |||
Debt Instrument [Line Items] | |||
Refinancing of long-term debt, new amount of debt | $ 77,000,000 |
Notes Payable and Capital Lea50
Notes Payable and Capital Leases Payable - Schedule of Long-Term Debt Maturities (Details) - First lien credit facility - Tranche A and Tranche A-2 Term Loans $ in Thousands | Dec. 31, 2016USD ($) |
Line of Credit Facility [Line Items] | |
2,017 | $ 38,250 |
2,018 | 41,438 |
2,019 | 383,250 |
Total | $ 462,938 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Issuance of common stock, net of initial public offering costs | $ 217,796 | |||
Issuance of common stock for employee stock purchase plan (in shares) | 283,644 | 272,836 | 249,494 | |
Stock repurchase program, authorized amount | $ 100,000 | $ 50,000 | $ 45,000 | |
Stock repurchase program, remaining authorized repurchase amount | $ 60,000 | |||
Number of shares repurchased | 3,414,675 | 1,895,625 | 490,419 | |
Stock Option | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Term of stock options | 4 years | |||
Restricted Stock Unit | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total grant date fair value of awards granted | $ 41,700 | $ 31,200 | ||
Performance-based restricted stock units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Term of stock options | 3 years | |||
ESPP | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Shares available for grant | 1,700,000 | |||
Minimum | Performance-based restricted stock units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percentage range | 0.00% | |||
Maximum | Performance-based restricted stock units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percentage range | 200.00% | |||
Nonemployee directors | Maximum | Stock Option | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Contractual term | 10 years | |||
2009 Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Shares available for grant | 6,671,436 | |||
Employee Stock Purchase Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options granted percentage of fair market value on offering date | 85.00% | |||
Stock options granted percentage of fair market value on purchase date | 85.00% | |||
Employee Stock Purchase Plan | Minimum | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Employees contribution on earnings | 1.00% | |||
Employee Stock Purchase Plan | Maximum | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Employees contribution on earnings | 15.00% | |||
IPO | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Initial public offering shares issued and sold (in shares) | 15,000,000 | |||
Public offering share price | $ 16 | |||
Issuance of common stock, net of initial public offering costs | $ 240,000 | |||
Proceeds from issuance initial public offering, net of underwriting discounts and commissions | 216,800 | |||
Underwriting discounts and commissions | 16,800 | |||
Offering expenses | $ 5,600 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Stock Option Activity under the Company's Equity-Based Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Number of Shares, Beginning Balance | 4,446,149 | |
Number of Shares, Granted | 0 | |
Number of Shares, Exercised | (1,297,812) | |
Number of Shares, Forfeited | (261,029) | |
Number of Shares, Expired | (72,084) | |
Number of Shares, Ending Balance | 2,815,224 | 4,446,149 |
Number of Shares, Exercisable, Ending Balance | 2,014,443 | |
Number of Shares, Vested and expected to vest, Ending Balance | 2,775,326.22314245 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||
Weighted-Average Exercise Price, Beginning Balance | $ 8.96 | |
Weighted-Average Exercise Price, Granted | 0 | |
Weighted-Average Exercise Price, Exercised | 4.06 | |
Weighted-Average Exercise Price, Forfeited | 17.53 | |
Weighted-Average Exercise Price, Expired | 27.01 | |
Weighted-Average Exercise Price, Ending Balance | 9.96 | $ 8.96 |
Weighted-Average Exercise Price, Exercisable, Ending Balance | 8 | |
Weighted-Average Exercise Price, Vested and expected to vest, Ending Balance | $ 9.83 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Weighted-Average Remaining Contractual Term (in years) | 6 years 6 months 60 days | 7 years 6 months 22 days |
Weighted-Average Remaining Contractual Term (in years), Exercisable | 6 years 4 months 32 days | |
Weighted-Average Remaining Contractual Term (in years), Vested and expected to vest | 6 years 6 months 55 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Aggregate Intrinsic Value [Roll Forward] | ||
Aggregate Intrinsic Value, Beginning Balance | $ 52,108 | |
Aggregate Intrinsic Value, Ending Balance | 46,231 | $ 52,108 |
Aggregate Intrinsic Value, Exercisable, Ending Balance | 36,459 | |
Aggregate Intrinsic Value, Vested and expected to vest, Ending Balance | $ 45,865 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Other Share-Based Compensation Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stock Option | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Weighted-average grant-date fair value of stock options granted | $ 12.73 | $ 7.18 | |
Total fair value of options vested | $ 6.8 | $ 12.2 | $ 7.5 |
Total intrinsic value of options exercised | 20.5 | 53.3 | 35.1 |
Cash received from options exercised | 5.3 | 7.3 | 2.2 |
Restricted Stock Unit | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total grant date fair value of restricted stock units granted | 41.7 | 31.2 | |
Total grant date fair value of restricted stock units vested | $ 16.4 | $ 3.5 | $ 0.1 |
Shares withheld to settle payroll tax liabilities to vesting of RSUs held by employees | 217,769 | 35,379 | 80,599 |
Stockholders' Equity - Summar54
Stockholders' Equity - Summary of Restricted Stock Unit and Performance Based Restricted Stock Units Activity under the Company's Equity-Based Plans (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Restricted Stock Unit | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Number of Units, Beginning Balance | shares | 956,687 |
Number of Units, Granted | shares | 2,281,998 |
Number of Units, Vested | shares | (695,253) |
Number of Units, Forfeited | shares | (220,381) |
Number of Units, Ending Balance | shares | 2,323,051 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 28.03 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 18.25 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 23.52 |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 22.29 |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 20.32 |
Performance-based restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Number of Units, Beginning Balance | shares | 173,286 |
Number of Units, Granted | shares | 0 |
Number of Units, Vested | shares | 0 |
Number of Units, Forfeited | shares | (23,874) |
Number of Units, Ending Balance | shares | 149,412 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 33.51 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 0 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 0 |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 33.51 |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 33.51 |
Stockholders' Equity - Summar55
Stockholders' Equity - Summary of Fair Value of Stock-based Awards Estimated using Black-Scholes Option-Pricing Model (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
ESPP | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (in years) | 6 months | 6 months | 6 months |
Expected volatility, minimum | 32.00% | 34.00% | 33.00% |
Expected volatility, maximum | 76.00% | 76.00% | 58.00% |
Risk-free interest rate, minimum | 0.33% | 0.07% | 0.06% |
Risk-free interest rate, maximum | 0.62% | 0.33% | 0.07% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Stock Option | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 1 month | 6 years 20 days | |
Expected volatility | 39.00% | 58.00% | |
Risk-free interest rate | 1.73% | 1.80% | |
Expected dividend yield | 0.00% | 0.00% |
Stockholders' Equity - Summar56
Stockholders' Equity - Summary of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 26,497 | $ 17,923 | $ 10,960 |
Income tax benefit recognized relating to stock-based compensation expense | 9,142 | 5,678 | 2,040 |
Actual tax benefit realized from stock options exercised | 7,076 | 19,609 | 13,514 |
Cost of providing services | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 6,607 | 4,244 | 2,658 |
Sales and marketing | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 6,573 | 4,490 | 2,755 |
General and administrative | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | 10,831 | 7,501 | 4,517 |
Systems development and programming costs | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 2,486 | $ 1,688 | $ 1,030 |
Stockholders' Equity - Schedu57
Stockholders' Equity - Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan (Detaills) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Stock Option | |
Class of Stock [Line Items] | |
Unrecognized compensation expense of options, net of forfeitures | $ 5,739 |
Unrecognized compensation expense, expected to be recognized over a weighted-average period | 1 year 4 months 28 days |
Restricted Stock Unit | |
Class of Stock [Line Items] | |
Unrecognized compensation expense of awards other than options, net of forfeitures | $ 42,198 |
Unrecognized compensation expense, expected to be recognized over a weighted-average period | 2 years 8 months 12 days |
Performance-based restricted stock units | |
Class of Stock [Line Items] | |
Unrecognized compensation expense of awards other than options, net of forfeitures | $ 374 |
Unrecognized compensation expense, expected to be recognized over a weighted-average period | 1 year |
Earnings Per Share (EPS) - Sche
Earnings Per Share (EPS) - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator (basic) | |||||||||||
Net income | $ 22,966 | $ 14,581 | $ 12,282 | $ 11,577 | $ 14,095 | $ 3,097 | $ (1,308) | $ 15,811 | $ 61,406 | $ 31,695 | $ 15,497 |
Less net income allocated to participating securities | 0 | 0 | (2,224) | ||||||||
Net income attributable to common stock | $ 61,406 | $ 31,695 | $ 13,273 | ||||||||
Denominator (basic) | |||||||||||
Weighted average shares of common stock outstanding | 70,159,696 | 70,228,159 | 56,160,539 | ||||||||
Basic EPS (in dollars per share) | $ 0.34 | $ 0.21 | $ 0.17 | $ 0.16 | $ 0.20 | $ 0.04 | $ (0.02) | $ 0.23 | $ 0.88 | $ 0.45 | $ 0.24 |
Numerator (diluted) | |||||||||||
Net income | $ 22,966 | $ 14,581 | $ 12,282 | $ 11,577 | $ 14,095 | $ 3,097 | $ (1,308) | $ 15,811 | $ 61,406 | $ 31,695 | $ 15,497 |
Less net income allocated to participating securities | 0 | 0 | (2,114) | ||||||||
Net income attributable to common stock | $ 61,406 | $ 31,695 | $ 13,383 | ||||||||
Denominator (diluted) | |||||||||||
Weighted average shares of common stock outstanding | 70,159,696 | 70,228,159 | 56,160,539 | ||||||||
Dilutive effect of stock options and restricted stock units | 1,812,000 | 2,390,000 | 3,406,000 | ||||||||
Weighted average shares of common stock outstanding | 71,972,486 | 72,618,069 | 59,566,773 | ||||||||
Diluted EPS (in dollars per share) | $ 0.32 | $ 0.20 | $ 0.17 | $ 0.16 | $ 0.20 | $ 0.04 | $ (0.02) | $ 0.22 | $ 0.85 | $ 0.44 | $ 0.22 |
Common stock equivalents excluded from diluted weighted average shares of common stock outstanding because of their anti-dilutive effect (in shares) | 871,000 | 1,004,000 | 526,000 |
401(k) Plan - Additional Inform
401(k) Plan - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |||
Company matching contributions to maximum employees eligible compensation for every dollar contributed by employee | $ 0.50 | ||
Company contributions to 401 (k) plan | $ 5,100,000 | $ 4,600,000 | $ 3,500,000 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | |||
Federal | $ 1,488 | $ 9,189 | $ (31,111) |
Foreign | 150 | 378 | 230 |
State | (364) | 3,794 | 4,618 |
Current tax expense (benefit) | 1,274 | 13,361 | (26,263) |
Deferred: | |||
Federal | 38,028 | 11,528 | 38,297 |
Foreign | (6) | (24) | 0 |
State | 4,278 | 320 | 2,951 |
Revaluation due to state legislative changes | (528) | 3,130 | 2,594 |
Deferred tax benefit (expense) | 41,772 | 14,954 | 43,842 |
Income Tax Benefit | $ 43,046 | $ 28,315 | $ 17,579 |
Income Taxes - U.S. Federal Sta
Income Taxes - U.S. Federal Statutory Income Tax Rate Reconciled to Effective Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Pre-Tax Income | $ 104,452 | $ 60,010 | $ 33,076 |
U.S. federal statutory tax rate | 36,558 | 21,004 | 11,577 |
State income taxes, net of federal benefit | 4,484 | 3,961 | 1,257 |
Tax rate change | (528) | 3,130 | 2,594 |
Nondeductible transaction costs | 0 | 0 | 305 |
Nondeductible meals, entertainment and penalties | 4,129 | 1,970 | 1,412 |
Stock-based compensation | 634 | 816 | 1,478 |
Uncertain tax positions | 23 | 98 | 268 |
Tax credits | (1,228) | (1,340) | (1,202) |
Net Operating Loss adjustment | 0 | (932) | 0 |
State tax return to provision adjustment | (1,267) | 0 | 0 |
Other | 241 | (392) | (110) |
Income Tax Benefit | $ 43,046 | $ 28,315 | $ 17,579 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
U.S. federal statutory tax rate | 35.00% | 35.00% | 35.00% |
State income taxes, net of federal benefit | 4.20% | 6.60% | 3.80% |
Tax rate change | (0.50%) | 5.20% | 7.80% |
Nondeductible transaction costs | 0.00% | 0.00% | 0.90% |
Nondeductible meals, entertainment and penalties | 4.00% | 3.30% | 4.30% |
Stock-based compensation | 0.60% | 1.30% | 4.50% |
Uncertain tax positions | 0.00% | 0.20% | 0.80% |
Tax credits | (1.20%) | (2.20%) | (3.60%) |
Net Operating Loss adjustment | 0.00% | (1.50%) | 0.00% |
State tax return to provision adjustment | (1.20%) | 0.00% | 0.00% |
Other | 0.30% | (0.70%) | (0.30%) |
Effective Income Tax Rate Reconciliation, Percent, Total | 41.20% | 47.20% | 53.20% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Disclosure [Line Items] | ||||
Change in state and local income taxes (as a percent) | (6.00%) | |||
Effective income tax rate | 41.20% | 47.20% | 53.20% | |
Tax rate change (as a percent) | $ (528) | $ 3,130 | $ 2,594 | |
State tax return to provision adjustment | $ (1,267) | $ 0 | $ 0 | |
State tax return to provision adjustment (as a percent) | (1.20%) | 0.00% | 0.00% | |
Valuation allowance related to operating loss carryforwards | $ 400 | |||
Valuation allowance | 5,689 | $ 5,276 | ||
Current tax expense (benefit) | 1,274 | 13,361 | $ (26,263) | |
Valuation allowance related to tax credit carryforwards | 4,700 | 4,700 | ||
Employment tax credit disallowed | 1,228 | 1,340 | 1,202 | |
Unrecognized tax benefits | 750 | 2,618 | $ 2,471 | $ 2,300 |
Unrecognized tax benefits, income tax penalties and interest accrued | 800 | 800 | ||
Canadian Subsidiary | ||||
Income Taxes Disclosure [Line Items] | ||||
Undistributed earnings | 2,700 | |||
Stock Option Exercises And Net Operating Loss Carryforward | ||||
Income Taxes Disclosure [Line Items] | ||||
Current tax expense (benefit) | (4,700) | |||
State and Local Jurisdiction | ||||
Income Taxes Disclosure [Line Items] | ||||
Net operating loss carryforwards | 95,500 | |||
Tax credit carryforwards | 6,500 | |||
State and Local Jurisdiction | Net Operating Loss Carryforwards | ||||
Income Taxes Disclosure [Line Items] | ||||
Stock option excess tax benefits | 13,100 | |||
Uncertain Tax Positions | ||||
Income Taxes Disclosure [Line Items] | ||||
Unrecognized tax benefits | 600 | $ 3,300 | ||
Internal Revenue Service (IRS) | ||||
Income Taxes Disclosure [Line Items] | ||||
Employment tax credit disallowed | 10,500 | |||
Income tax examination, penalties and interest expense | $ 4,000 |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Net operating losses (federal and state) | $ 4,397 | $ 2,508 |
Accrued expenses | 10,239 | 9,908 |
Accrued workers' compensation costs | 13,266 | 18,823 |
Stock-based compensation | 5,350 | 4,643 |
Tax benefits relating to uncertain positions | 37 | 29 |
Tax credits (federal and state) | 6,344 | 6,272 |
Other | (47) | 113 |
Total | 39,586 | 42,296 |
Valuation allowance | (5,689) | (5,276) |
Total deferred tax assets | 33,897 | 37,020 |
Deferred tax liabilities: | ||
Depreciation and amortization | (8,055) | (3,277) |
Deferred service revenues | (114,646) | (85,263) |
Prepaid health plan expenses | (3,569) | (3,121) |
Total deferred tax liabilities | (126,270) | (91,661) |
Net non-current deferred tax liabilities | $ (92,373) | $ (54,641) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Uncertainties [Abstract] | |||
Unrecognized tax benefits at January 1 | $ 2,618 | $ 2,471 | $ 2,300 |
Additions for tax positions of prior periods | 0 | 0 | 25 |
Additions for tax positions of current period | 132 | 167 | 182 |
Settlements with taxing authorities | (1,855) | 0 | 0 |
Lapse of applicable statute of limitations | (130) | 0 | 0 |
Adjustments to tax positions | (15) | (20) | (36) |
Unrecognized tax benefits at December 31 | $ 750 | $ 2,618 | $ 2,471 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Minimum Future Rental Payments under Non-Cancelable Operating and Capital Lease (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,017 | $ 15,274 |
2,018 | 13,809 |
2,019 | 11,840 |
2,020 | 11,334 |
2,021 | 5,505 |
Thereafter | 6,882 |
Minimum lease payments | $ 64,644 |
Commitments and Contingencies66
Commitments and Contingencies - Additional Information (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016USD ($)letter_of_credit | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Debt Instrument [Line Items] | |||
Rent expenses incurred | $ 16.7 | $ 12.9 | $ 11.9 |
Number of letters of credit | letter_of_credit | 2 | ||
Standby Letters of Credit | |||
Debt Instrument [Line Items] | |||
Letters of credit available, amount | $ 17.8 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |||
Revenue from related parties | $ 10.2 | $ 6.1 | $ 3.9 |
Board of Directors Chairman | |||
Related Party Transaction [Line Items] | |||
Payment to chairman of the board of directors | $ 7.1 | $ 4.1 | $ 5.9 |
Quarterly Financial Data (Una68
Quarterly Financial Data (Unaudited) - Summary of Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenues | $ 811,071 | $ 770,457 | $ 745,846 | $ 732,939 | $ 725,695 | $ 668,008 | $ 640,007 | $ 625,578 | $ 3,060,313 | $ 2,659,288 | $ 2,193,531 |
Insurance costs | 637,968 | 609,422 | 596,673 | 569,689 | 576,698 | 534,481 | 517,994 | 483,203 | 2,413,752 | 2,112,376 | 1,686,315 |
Operating income | 42,717 | 28,972 | 26,367 | 25,902 | 29,609 | 11,682 | 5,985 | 31,041 | 123,958 | 78,317 | 86,791 |
Net income | $ 22,966 | $ 14,581 | $ 12,282 | $ 11,577 | $ 14,095 | $ 3,097 | $ (1,308) | $ 15,811 | $ 61,406 | $ 31,695 | $ 15,497 |
Basic net income (loss) per share (in dollars per share) | $ 0.34 | $ 0.21 | $ 0.17 | $ 0.16 | $ 0.20 | $ 0.04 | $ (0.02) | $ 0.23 | $ 0.88 | $ 0.45 | $ 0.24 |
Diluted net income (loss) per share (in dollars per share) | $ 0.32 | $ 0.20 | $ 0.17 | $ 0.16 | $ 0.20 | $ 0.04 | $ (0.02) | $ 0.22 | $ 0.85 | $ 0.44 | $ 0.22 |
Schedule II - Valuation and Q69
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for Doubtful Accounts | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Period | $ 1,158 | $ 388 | $ 865 |
Credited / Charged to Net Income | 1,418 | 2,085 | 947 |
Charges utilized / Write- offs | (2,284) | (1,315) | (1,424) |
Balance at End of Period | 292 | 1,158 | 388 |
Valuation Allowance of Deferred Tax Assets | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at Beginning of Period | 5,276 | 6,945 | 5,194 |
Credited / Charged to Net Income | 413 | 0 | 1,751 |
Charges utilized / Write- offs | 0 | (1,669) | 0 |
Balance at End of Period | $ 5,689 | $ 5,276 | $ 6,945 |