Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 17, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 1-32961 | ||
Entity Registrant Name | CBIZ, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 22-2769024 | ||
Entity Address, Address Line One | 6801 Brecksville Rd., | ||
Entity Address, Address Line Two | Door N. | ||
Entity Address, City or Town | Independence | ||
Entity Address, State or Province | OH | ||
Entity Address, Postal Zip Code | 44131 | ||
City Area Code | 216 | ||
Local Phone Number | 447-9000 | ||
Title of 12(b) Security | Common Stock, $0.01 Par Value | ||
Trading Symbol | CBZ | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2,000 | ||
Entity Common Stock, Shares Outstanding | 50,380,328 | ||
Documents Incorporated by Reference | The registrant incorporates by reference in Part III hereof portions of its definitive Proxy Statement for its 2023 Annual Meeting of Stockholders. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000944148 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | KPMG LLP |
Auditor Location | Cleveland, OH |
Auditor Firm ID | 185 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 4,697 | $ 1,997 |
Restricted cash | 28,487 | 30,383 |
Accounts receivable, net | 334,498 | 242,168 |
Other current assets | 29,431 | 19,217 |
Current assets before funds held for clients | 397,113 | 293,765 |
Funds held for clients | 171,313 | 157,909 |
Total current assets | 568,426 | 451,674 |
Non-current assets: | ||
Property and equipment, net | 45,184 | 43,423 |
Goodwill and other intangible assets, net | 951,702 | 840,783 |
Assets of deferred compensation plan | 118,862 | 136,321 |
Right-of-use asset, net | 184,043 | 151,145 |
Other non-current assets | 10,907 | 4,588 |
Total non-current assets | 1,310,698 | 1,176,260 |
Total assets | 1,879,124 | 1,627,934 |
Current liabilities: | ||
Accounts payable | 80,725 | 65,757 |
Income taxes payable | 1,607 | 1,671 |
Accrued personnel costs | 130,456 | 114,032 |
Contingent purchase price liability | 63,262 | 34,373 |
Lease liability | 36,358 | 30,586 |
Other current liabilities | 26,532 | 18,755 |
Current liabilities before client fund obligations | 338,940 | 265,174 |
Client fund obligations | 173,467 | 158,115 |
Total current liabilities | 512,407 | 423,289 |
Non-current liabilities: | ||
Bank debt | 265,700 | 155,300 |
Debt issuance costs | (2,046) | (449) |
Total long-term debt | 263,654 | 154,851 |
Income taxes payable | 2,211 | 1,727 |
Deferred income taxes, net | 24,763 | 15,440 |
Deferred compensation plan obligations | 118,862 | 136,321 |
Contingent purchase price liability | 68,748 | 44,766 |
Lease liability | 174,454 | 145,808 |
Other non-current liabilities | 573 | 1,184 |
Total non-current liabilities | 653,265 | 500,097 |
Total liabilities | 1,165,672 | 923,386 |
STOCKHOLDERS’ EQUITY | ||
Common stock, par value $0.01 per share; shares authorized 250,000; shares issued 136,295 and 135,187; shares outstanding 50,180 and 52,038 | 1,363 | 1,352 |
Additional paid-in capital | 799,147 | 770,117 |
Retained earnings | 734,116 | 628,762 |
Treasury stock, 86,115 and 83,149 shares | (824,778) | (694,716) |
Accumulated other comprehensive income (loss) | 3,604 | (967) |
Total stockholders’ equity | 713,452 | 704,548 |
Total liabilities and stockholders’ equity | $ 1,879,124 | $ 1,627,934 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock issued (in shares) | 136,295,000 | 135,187,000 |
Common stock outstanding (in shares) | 50,180,000 | 52,038,000 |
Treasury stock (in shares) | 86,115,000 | 83,149,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Revenue | $ 1,411,979 | $ 1,104,925 | $ 963,897 |
Operating expenses | 1,188,612 | 945,635 | 825,351 |
Gross margin | 223,367 | 159,290 | 138,546 |
Corporate general and administrative expenses | 55,023 | 56,150 | 46,066 |
Legal settlement, net | 0 | 30,468 | 0 |
Operating income (loss) | 168,344 | 72,672 | 92,480 |
Other (expense) income: | |||
Interest expense | (8,039) | (3,868) | (4,983) |
Gain (loss) on sale of operations, net | 413 | 5,995 | (509) |
Other (expense) income, net | (19,225) | 18,241 | 16,500 |
Total other (expense) income, net | (26,851) | 20,368 | 11,008 |
Income from continuing operations before income tax expense | 141,493 | 93,040 | 103,488 |
Income tax expense | 36,121 | 22,129 | 25,141 |
Income from continuing operations | 105,372 | 70,911 | 78,347 |
Loss from operations of discontinued operations, net of tax | (18) | (24) | (48) |
Net income | $ 105,354 | $ 70,887 | $ 78,299 |
Earnings Per Share: | |||
Continuing operations (in dollars per share) | $ 2.05 | $ 1.35 | $ 1.44 |
Discontinued operations (in dollars per share) | 0 | 0 | 0 |
Net income (loss) (in dollars per share) | 2.05 | 1.35 | 1.44 |
Diluted: | |||
Continuing operations (in dollars per share) | 2.01 | 1.32 | 1.42 |
Discontinued operations (in dollars per share) | 0 | 0 | (0.01) |
Net income (loss) (in dollars per share) | $ 2.01 | $ 1.32 | $ 1.41 |
Basic weighted average common shares outstanding (in shares) | 51,502 | 52,637 | 54,288 |
Diluted weighted average common shares outstanding (in shares) | 52,388 | 53,723 | 55,359 |
Comprehensive income: | |||
Net income | $ 105,354 | $ 70,887 | $ 78,299 |
Other comprehensive income (loss): | |||
Net unrealized loss on available-for-sale securities, net of income tax benefit of $520, $179 and $14 | (1,391) | (478) | (42) |
Net unrealized gain (loss) on interest rate swaps, net of income tax expense (benefit) of $1,965, $577 and $(494) | 5,986 | 1,799 | (1,525) |
Foreign currency translation | (24) | (19) | (22) |
Total other comprehensive income (loss) | 4,571 | 1,302 | (1,589) |
Total comprehensive income | $ 109,925 | $ 72,189 | $ 76,710 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net unrealized (loss) gain on available-for-sale securities, income tax (benefit) expense | $ (520) | $ (179) | $ (14) |
Net unrealized gain (loss) on interest rate swaps, income tax (benefit) | $ 1,965 | $ 577 | $ (494) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Restricted stock units and awards | Performance share units | Common Stock | Common Stock Restricted stock units and awards | Common Stock Performance share units | Treasury Shares | Additional Paid-In Capital | Additional Paid-In Capital Restricted stock units and awards | Additional Paid-In Capital Performance share units | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Common stock, beginning balance (in shares) at Dec. 31, 2019 | 133,056 | |||||||||||
Treasury stock, beginning balance (in shares) at Dec. 31, 2019 | 77,637 | |||||||||||
Beginning balance at Dec. 31, 2019 | $ 659,238 | $ 1,331 | $ (535,693) | $ 714,704 | $ 479,576 | $ (680) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 78,299 | 78,299 | ||||||||||
Other comprehensive income (loss) | (1,589) | (1,589) | ||||||||||
Share repurchases (in shares) | 2,311 | |||||||||||
Share repurchases | (57,564) | $ (57,564) | ||||||||||
Indirect repurchase of shares for minimum tax withholding (in shares) | 97 | |||||||||||
Indirect repurchase of shares for minimum tax withholding | (2,040) | $ (2,040) | ||||||||||
Restricted stock units and awards and Performance share units (in shares) | 25 | |||||||||||
Stock options exercised (in shares) | 634 | |||||||||||
Stock options exercised | 6,486 | $ 6 | 6,480 | |||||||||
Share-based compensation | 8,869 | 8,869 | ||||||||||
Business acquisitions (in shares) | 429 | |||||||||||
Business acquisitions | 10,921 | $ 4 | 10,917 | |||||||||
Common stock, ending balances (in shares) at Dec. 31, 2020 | 134,144 | |||||||||||
Treasury stock, ending balance (in shares) at Dec. 31, 2020 | 80,045 | |||||||||||
Ending balance at Dec. 31, 2020 | 702,620 | $ 1,341 | $ (595,297) | 740,970 | 557,875 | (2,269) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 70,887 | 70,887 | ||||||||||
Other comprehensive income (loss) | 1,302 | 1,302 | ||||||||||
Share repurchases (in shares) | 3,012 | |||||||||||
Share repurchases | (96,382) | $ (96,382) | ||||||||||
Indirect repurchase of shares for minimum tax withholding (in shares) | 92 | |||||||||||
Indirect repurchase of shares for minimum tax withholding | (3,037) | $ (3,037) | ||||||||||
Restricted stock units and awards and Performance share units (in shares) | 80 | |||||||||||
Restricted stock units and awards and Performance share units | $ 0 | $ 1 | $ (1) | |||||||||
Stock options exercised (in shares) | 647 | |||||||||||
Stock options exercised | 7,311 | $ 7 | 7,304 | |||||||||
Share-based compensation | 11,407 | 11,407 | ||||||||||
Business acquisitions (in shares) | 316 | |||||||||||
Business acquisitions | $ 10,440 | $ 3 | 10,437 | |||||||||
Common stock, ending balances (in shares) at Dec. 31, 2021 | 135,187 | 135,187 | ||||||||||
Treasury stock, ending balance (in shares) at Dec. 31, 2021 | 83,149 | 83,149 | ||||||||||
Ending balance at Dec. 31, 2021 | $ 704,548 | $ 1,352 | $ (694,716) | 770,117 | 628,762 | (967) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 105,354 | 105,354 | ||||||||||
Other comprehensive income (loss) | 4,571 | 4,571 | ||||||||||
Share repurchases (in shares) | 2,778 | |||||||||||
Share repurchases | (122,773) | $ (122,773) | ||||||||||
Indirect repurchase of shares for minimum tax withholding (in shares) | 188 | |||||||||||
Indirect repurchase of shares for minimum tax withholding | $ (7,289) | $ (7,289) | ||||||||||
Restricted stock units and awards and Performance share units (in shares) | 120 | 211 | ||||||||||
Restricted stock units and awards and Performance share units | $ 0 | $ 0 | $ 1 | $ 2 | $ (1) | $ (2) | ||||||
Stock options exercised (in shares) | 670 | 670 | ||||||||||
Stock options exercised | $ 10,035 | $ 7 | 10,028 | |||||||||
Share-based compensation | 14,689 | 14,689 | ||||||||||
Business acquisitions (in shares) | 107 | |||||||||||
Business acquisitions | $ 4,317 | $ 1 | 4,316 | |||||||||
Common stock, ending balances (in shares) at Dec. 31, 2022 | 136,295 | 136,295 | ||||||||||
Treasury stock, ending balance (in shares) at Dec. 31, 2022 | 86,115 | 86,115 | ||||||||||
Ending balance at Dec. 31, 2022 | $ 713,452 | $ 1,363 | $ (824,778) | $ 799,147 | $ 734,116 | $ 3,604 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net income | $ 105,354 | $ 70,887 | $ 78,299 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
(Gain) loss on sale of operations, net of tax | (413) | (5,995) | 509 |
Depreciation and amortization expense | 32,895 | 27,078 | 23,139 |
Bad debt expense, net of recoveries | 1,173 | 3,054 | 4,409 |
Adjustment to contingent earnout liability, net | 2,435 | 2,367 | (629) |
Deferred income taxes | 13,877 | 9,234 | (770) |
Stock-based compensation expense | 14,689 | 11,407 | 8,869 |
Other, net | (1,817) | (126) | 485 |
Changes in assets and liabilities, net of acquisitions and divestitures: | |||
Accounts receivable, net | (61,106) | (17,040) | 6,714 |
Other assets | (11,855) | 3,474 | 1,472 |
Accounts payable | 14,363 | 3,312 | (8,800) |
Income taxes payable | (5,578) | (4,108) | (236) |
Accrued personnel costs | 24,009 | 24,525 | 19,788 |
Other liabilities | (1,876) | 3,109 | 13,667 |
Net cash provided by continuing operations | 126,150 | 131,178 | 146,916 |
Operating cash flows used in discontinued operations | (18) | (24) | (71) |
Net cash provided by operating activities | 126,132 | 131,154 | 146,845 |
Cash flows from investing activities: | |||
Business acquisitions and purchases of client lists, net of cash acquired | (79,141) | (66,734) | (71,430) |
Purchases of client fund investments | (19,771) | (26,980) | (3,447) |
Proceeds from the sales and maturities of client fund investments | 12,400 | 14,877 | 37,487 |
Proceeds from sales of assets and divested operations | 3,022 | 9,710 | 711 |
Additions to property and equipment | (8,641) | (8,984) | (11,576) |
Other, net | (6,987) | (3,899) | 1,849 |
Net cash used in investing activities | (99,118) | (82,010) | (46,406) |
Cash flows from financing activities: | |||
Proceeds from bank debt | 824,900 | 852,100 | 592,354 |
Payment of bank debt | (714,500) | (804,800) | (589,854) |
Payment for acquisition of treasury stock | (122,538) | (97,450) | (56,496) |
Indirect repurchase of shares for minimum tax withholding | (7,289) | (3,037) | (2,040) |
Changes in client funds obligations | 15,352 | (8,874) | (13,747) |
Payment of contingent consideration of acquisitions | (21,231) | (14,084) | (12,859) |
Proceeds from exercise of stock options | 10,035 | 7,311 | 6,486 |
Other, net | (2,072) | (171) | (453) |
Net cash used in financing activities | (17,343) | (69,005) | (76,609) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 9,671 | (19,861) | 23,830 |
Cash, cash equivalents and restricted cash at beginning of year | 150,474 | 170,335 | 146,505 |
Cash, cash equivalents and restricted cash at end of year | 160,145 | 150,474 | 170,335 |
Reconciliation of cash, cash equivalents and restricted cash to the Consolidated Balance Sheets | |||
Cash and cash equivalents | 4,697 | 1,997 | 4,652 |
Restricted cash | 28,487 | 30,383 | 23,951 |
Cash equivalents included in funds held for clients | 126,961 | 118,094 | 141,732 |
Cash, cash equivalents and restricted cash at end of year | 160,145 | 150,474 | 170,335 |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest | 7,421 | 3,350 | 4,739 |
Cash paid for income taxes, net of income tax refunds | $ 27,815 | $ 16,998 | $ 25,939 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Selected Terms Used in Notes to Consolidated Financial Statements ASA - Administrative Service Agreement. ASC - Accounting Standards Codification. ASU - Accounting Standards Update. CPA firm - Certified Public Accounting firm. FASB - The Financial Accounting Standards Board. GAAP - United States Generally Accepted Accounting Principles. LIBOR - London Interbank Offered Rate. SOFR - The Secured Overnight Financing Rate. New Lease Standard - ASC Topic 842, Leases ROU- Right of Use. SEC - United States Securities & Exchange Commission. Organization - CBIZ, Inc. is a leading provider of financial, insurance and advisory services to businesses throughout the United States and parts of Canada. Acting through its subsidiaries, it has been serving small and medium-sized businesses, as well as individuals, governmental entities, and not-for-profit enterprises. CBIZ, Inc. manages and reports its operations along three practice groups: Financial Services, Benefits and Insurance Services and National Practices. A further description of products and services offered by each of the practice groups is provided in Note 19, Segment Disclosures, to the accompanying consolidated financial statements. Basis of Presentation - The accompanying consolidated financial statements reflect the operations of CBIZ, Inc. and all of its wholly-owned subsidiaries (“CBIZ,” the “Company,” “we,” “us” or “our”), after elimination of all intercompany accounts and transactions. We have prepared the accompanying consolidated financial statements in accordance with GAAP and pursuant to the rules and regulations of the SEC. We have determined that our relationship with certain CPA firms with whom we maintain ASAs qualify as variable interest entities. The accompanying consolidated financial statements do not reflect the operations or accounts of variable interest entities as the impact is not material to our consolidated financial condition, results of operations or cash flows. Fees earned by us under the ASAs are recorded at net realizable value as a component of “Revenue” in the accompanying Consolidated Statements of Comprehensive Income and were approximately $235.4 million, $174.8 million and $159.4 million for the years ended December 31, 2022, 2021 and 2020, respectively, the majority of which was related to services rendered to privately-held clients. In the event that accounts receivable and unbilled work in process become uncollectible by the CPA firms, the service fee due to us is typically reduced on a proportional basis. Although the ASAs do not constitute control, we are one of the beneficiaries of the agreements and may bear certain economic risks. Refer to Note 17, Related Parties, for further discussion regarding the ASAs. In 2021, CBIZ formed a grantor trust (the “Trust”) with Wilmington Savings Funds Society, FSB, a Federal savings bank, serving as trustee. The Trust holds the majority of the funds provided by CBIZ’s clients for payroll processing pending remittance to employees of those clients, tax authorities, and other payees. CBIZ is the sole beneficial owner of the Trust. The Trust is considered a variable interest entity in accordance with ASC 810, Consolidation. CBIZ has both the power to direct the activities that most significantly impact the economic performance of the Trust (including the power to make all investment decisions for the Trust) and the right to receive benefits that could potentially be significant to the Trust (in the form of investment returns). As a result, CBIZ consolidates the Trust in its condensed consolidated financial statements. Certain prior period amounts have been reclassified to conform to current year's presentation. Significant Accounting Policies - We consider the following policies to be beneficial in understanding the judgments that are involved in the preparation of our consolidated financial statements and the uncertainties that could impact our financial condition, results of operations and cash flows. Use of Estimates - The preparation of consolidated financial statements in conformity with GAAP and pursuant to the rules and regulations of the SEC requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Management’s estimates and assumptions are derived from and are continually evaluated based upon available information, judgment and experience. Actual results may differ materially from these estimates. Revenue Recognition - We account for revenue in accordance with Topic 606, Revenue from Contracts with Customers. We recognize revenue based on the five-step model; (i) identify the contract with the customer; (ii) identify the performance obligation in the contract; (iii) determine the contract price; (iv) allocate the transaction price; and (v) recognize revenue as each performance obligation is satisfied. If we determine that a contract with enforceable rights and obligations does not exist, revenues are deferred until all criteria for an enforceable contract are met. For further information on our various streams of revenue, refer to Note 2, Revenue, to the accompanying consolidated financial statements. Operating Expenses - Operating expenses represent costs of service and other costs incurred to operate our business units and are primarily comprised of personnel costs and occupancy related expenses. Personnel costs include (i) salaries and benefits; (ii) commissions paid to producers; (iii) incentive compensation; and (iv) share-based compensation. Incentive compensation costs and share-based compensation are estimated and accrued. The final determination of incentive compensation is made after year-end results are finalized. The largest components of occupancy costs are rent expense and utilities. Base rent expense is recognized over respective lease terms, while utilities and common area maintenance charges are recognized as incurred. Share-Based Compensation - The measurement of all share-based compensation arrangements is based on their respective grant date fair value. The grant date fair value of stock options is based on the Black-Scholes-Merton pricing model, which incorporates assumptions regarding the expected volatility, the expected option life, the risk-free interest rate and the expected dividend yield. The grant date fair value of restricted stock awards and restricted stock units is based on the closing price of the underlying stock on the date of issuance. The grant date fair value of the performance share units is based on the closing price of the underlying stock on the date of issuance and recorded based on achievement of target performance metrics. The expense related to stock options, restricted stock awards, and restricted stock units is recognized over the requisite service period which is generally three Share-based compensation expense is recorded in the accompanying Consolidated Statements of Comprehensive Income as “Operating expenses” or “Corporate general and administrative expenses,” depending on where the respective individual’s compensation is recorded. For additional discussion regarding share-based awards, refer to Note 14, Employee Share Plans, to the accompanying consolidated financial statements. Operating Leases - We determine if a contract is a lease at inception. We have leases for office space and facilities, automobiles, and certain information technology equipment. Certain of these leases include options to extend the lease and some include options to terminate the lease early. Effective January 1, 2019, we adopted the New Lease Standard using the modified retrospective method of applying the new standard at the adoption date. As an accounting policy election, we elected not to apply the recognition requirements under the New Lease Standards to short term leases (a lease at commencement date that has a lease term of 12 months or less and does not contain a purchase option that we are reasonably certain to exercise). The ROU assets and lease liabilities are recognized as of the commencement date based on the present value of the lease payments over the lease term. The discount rate utilized for the measurement purpose is based on our secured fixed rate to borrow over a comparable term for the lease because the rate implicit in the lease is not determinable. The lease term may include the options to extend or terminate the lease when it is reasonably certain that we will exercise the applicable option. Related rent expense under such leases is recognized evenly throughout the term of the lease when the total lease commitment is a known amount, and recorded on an as incurred basis when future rent payment increases under the obligation are unknown due to rent escalations being tied to factors that are not currently measurable (such as increases in the consumer price index). Differences between rent expense recognized and the cash payments required under these leases are recorded as a component of “Operating lease liability” in the Non-current liabilities section of the accompanying Consolidated Balance Sheets. We may receive incentives to lease office facilities in certain areas. Such incentives are recorded as a change in lease payments and may require us to remeasure the lease liability to reflect the change in lease payments. Cash and Cash Equivalents - Cash and cash equivalents consist of cash on hand and investments with an original maturity of three months or less when purchased. Restricted Cash - Restricted cash consists of funds held by us in relation to our capital and investment advisory services as those funds are restricted in accordance with applicable Financial Industry Regulatory Authority regulations. Restricted cash also consists of funds on deposit from clients in connection with the pass-through of insurance premiums to the carrier with the related liability for these funds recorded in “Accounts payable” in the accompanying Consolidated Balance Sheets. Accounts Receivable and Allowance for Doubtful Accounts - Accounts receivable, less allowances for doubtful accounts, reflects the net realizable value of receivables and approximates fair value. Unbilled revenues are recorded at estimated net realizable value. Assessing the collectability of receivables (billed and unbilled) requires management judgment based on a combination of factors. When evaluating the adequacy of the allowance for doubtful accounts and the overall probability of collecting on receivables, we analyze historical experience, client credit-worthiness, the age of the trade receivable balances, current economic conditions that may affect a client’s ability to pay and current and projected economic trends and conditions at the balance sheet date. At December 31, 2022 and 2021, the allowance for doubtful accounts was $20.8 million and $16.2 million, respectively, in the accompanying Consolidated Balance Sheets. Funds Held for Clients and Client Fund Obligations - Services provided by our payroll operations include the preparation of payroll checks, federal, state, and local payroll tax returns, and flexible spending account administration. In relation to these services, as well as other similar service offerings, we collect funds from our clients’ accounts in advance of paying client obligations. These funds, collected before they are due, are segregated and invested in accordance with our investment policy, which requires all investments carry an investment grade rating at the time of initial investment. These investments, primarily consisting of corporate and municipal bonds and U.S. treasury bills, are classified as available-for-sale and are included in the “Funds held for clients” line item on the accompanying Consolidated Balance Sheets. The underlying obligation is recorded as “Client fund obligations” on the Consolidated Balance Sheets. The balances in these accounts fluctuate with the timing of cash receipts and the related cash payments and may vary significantly during the year based on the timing of client’s payroll periods. Other than certain federal and state regulations pertaining to flexible spending account administration, there are no regulatory or other contractual restrictions placed on these funds. Refer to Note 6, Financial Instruments, to the accompanying consolidated financial statements for further discussion of investments related to funds held for clients. Property and Equipment - Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are provided on a straight-line basis over the following estimated useful lives: Buildings 25 to 40 years Furniture and fixtures 5 to 10 years Capitalized software 3 to 5 years Equipment 3 to 7 years Leasehold improvements are amortized using the straight-line method over the shorter of their estimated useful lives or the remaining respective lease term. The cost of software purchased or developed for internal use is capitalized and amortized using the straight-line method over an estimated useful life not to exceed five years. We periodically review long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying value of the assets may not be recoverable. Under those circumstances, if the fair value were less than the carrying amount of the asset, we would recognize a loss for the difference. Goodwill and Other Intangible Assets - Goodwill represents the excess of the purchase price of the acquired businesses and the related fair value of the net assets acquired. At December 31, 2022, the carrying value of goodwill totaled $819.9 million, compared to total assets of $1.9 billion and total shareholders’ equity of $713.5 million. Intangible assets consist of identifiable intangibles other than goodwill. Identifiable intangible assets other than goodwill include client lists and non-compete agreements which require significant judgments in determining the fair value. We carry client lists and non-compete agreements at cost, less accumulated amortization, in the accompanying Consolidated Balance Sheets. Goodwill is reviewed for impairment annually during the fourth quarter or more frequently in the event of an impairment indicator. We are required to consider whether it is more likely than not (defined as a likelihood of more than 50%) that the fair value of each reporting unit has fallen below its carrying value, thus requiring us to perform an interim goodwill impairment test. Intangible assets with definite lives, such as client lists and non-compete agreements, are amortized using the straight-line method over their estimated useful lives (generally ranging from three The goodwill impairment test is performed at a reporting unit level. A reporting unit is an operating segment of a business or one level below an operating segment. At December 31, 2022, we had five reporting units. We may use either a qualitative or quantitative approach when testing a reporting unit’s goodwill for impairment. Under the qualitative assessment, we are not required to calculate the fair value of a reporting unit unless we determine that it is more likely than not that its fair value is less than its carrying amount. If under the quantitative assessment the fair value of a reporting unit is less than its carrying amount, then the amount of the impairment loss, if any, must be measured. Any such impairment charge would reduce earnings and could be material. After considering changes to assumptions used in our most recent quantitative testing for each reporting unit, including the capital market environment, economic and market conditions, industry competition and trends, our weighted average cost of capital, changes in management and key personnel, the price of our common stock, changes in our results of operations, the magnitude of the excess of fair value over the carrying amount of each reporting unit as determined in our most recent quantitative testing, and other factors, we concluded that it was more likely than not that the fair values of each of our reporting units exceeded their respective carrying values and, therefore, did not perform a quantitative impairment analysis. For further information regarding our goodwill balances, refer to Note 5, Goodwill and Other Intangible Assets, net, to the accompanying consolidated financial statements. Income Taxes - Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently payable and deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and operating losses and tax credit carryforwards. State income tax credits are accounted for using the flow-through method. A valuation allowance is provided when it is more-likely-than-not that all or some portion of a deferred tax asset will not be realized. We determine valuation allowances based on all available evidence. Such evidence includes historical results, the reversal of deferred tax liabilities, expectations of future consolidated and/or separate company profitability and the feasibility of tax-planning strategies. Determining valuation allowances includes significant judgment by management, and different judgments could yield different results. Accounting for uncertain tax positions requires a more-likely-than-not threshold for recognition in the consolidated financial statements. We recognize a tax benefit based on whether it is more-likely-than-not that a tax position will be sustained. We record a liability to the extent that a tax position taken or expected to be taken on a tax return exceeds the amount recognized in the consolidated financial statements. Business Combinations - We recognize and measure identifiable tangible and intangible assets acquired and liabilities assumed as of the acquisition date at fair value. Fair value measurements require extensive use of estimates and assumptions, including estimates of future cash flows to be generated by the acquired assets. The operating results of acquired businesses are included in our consolidated financial statements beginning on the date of acquisition. The purchase price is equivalent to the fair value of consideration transferred. Goodwill is recognized for the excess of purchase price over the net fair value of assets acquired and liabilities assumed. Contingent Purchase Price Liabilities - Contingent purchase price liabilities consisting of cash payments and common stock issuances result from our business acquisitions and are recorded at fair value at the time of acquisition as “Contingent purchase price liability - current” and “Contingent purchase price liability - non-current” in the accompanying Consolidated Balance Sheets. We estimate the fair value of our contingent purchase price liabilities using a probability-weighted discounted cash flow model. We probability weight risk-adjusted estimates of future performance of acquired businesses, then calculate the contingent purchase price based on the estimates and discount them to present value representing management’s best estimate of fair value. The fair value of the contingent purchase price liabilities, which is considered a Level 3 unobservable input, is reassessed on a quarterly basis based on assumptions provided by practice group leaders and business unit controllers together with our corporate finance department. Any change in the fair value estimate, including the revaluation of common stock, is recorded in the earnings of that period. For the years ended December 31, 2022, 2021 and 2020, we recorded other (expense) income of ($2.4) million, ($2.4) million and $0.6 million, respectively, related to net changes in the fair value of contingent consideration. Refer to Note 7, Fair Value Measurements, and Note 18, Business Combinations, for further discussion of our contingent purchase price liabilities and acquisitions. Interest Rate Derivative Instruments - We maintain interest rate swaps that are designated as cash flow hedges to manage the market risk from changes in interest rates on our floating-rate debt under our $600.0 million unsecured credit facility, by and among CBIZ Operations, Inc., CBIZ, Inc. and Bank of America, N.A., as administrative agent and bank, and other participating banks. The designation of a derivative instrument as a hedge and its ability to meet the hedge accounting criteria determine how we reflect the change in fair value of the derivative instrument. A derivative qualifies for hedge accounting treatment if, at inception, it meets defined correlation and effectiveness criteria. These criteria require that the anticipated cash flows and/or changes in fair value of the hedging instrument substantially offset those of the position being hedged. We utilize derivative instruments to manage interest rate risk associated with our floating-rate debt under the credit facility. Interest rate swap contracts mitigate the risk associated with the underlying hedged item. If the contract is designated as a cash flow hedge, the mark-to-market gains or losses on the swap are deferred and included as a component of accumulated other comprehensive loss, net of tax, to the extent effective, and reclassified to interest expense in the same period during which the hedged transaction affects earnings. For further discussion regarding derivative financial instruments, refer to Note 6, Financial Instruments, to the accompanying consolidated financial statements. Recent Accounting Pronouncements - The FASB ASC is the sole source of authoritative GAAP other than the SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an ASU to communicate changes to the FASB codification. We assess and review the impact of all ASUs. ASUs not listed below were reviewed and determined to be either not applicable or are not expected to have a material impact on the consolidated financial statements. Accounting Standards Adopted in 2022 Reference Rate Reform: In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU are effective for all entities through December 31, 2022. Subsequently, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope, which provides optional temporary guidance for entities transitioning away from the LIBOR and other interbank offered rates to new reference rates so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions within Topic 848. This ASU clarifies that the derivative instruments affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions provided in Topic 848. ASU 2021-01 is effective immediately for all entities. Entities may elect to apply the amendments on a full retrospective basis as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or on a prospective basis to new modifications from any date within an interim period that includes or is subsequent to the date of the issuance of a final update, up to the date that financial statements are available to be issued. The amendments provided in this ASU do not apply to contract modifications made, as well as new hedging relationships entered into, after December 31, 2022, and to existing hedging relationships evaluated for effectiveness for periods after December 31, 2022, except for certain hedging relationships existing as of December 31, 2022, that apply certain optional expedients in which the accounting effects are recorded through the end of the hedging relationship. On May 4, 2022, we entered into a Second Amended and Restated Credit Agreement (the "2022 credit facility" or the "credit facility"), by and among CBIZ Operations, Inc. ("CBIZ Operations"), and Bank of America, N.A., as administrative agent, and other financial institutions. The 2022 credit facility amends the Amended and Restated Credit Agreement, dated as of April 3, 2018 (the "2018 credit facility"). Among other things, the 2022 Credit Facility amends the base interest rate from LIBOR to term SOFR. Consequently, we amended the interest rate swap agreements with respect to the existing swaps. Effective May 16, 2022, the scheduled reset date, the interest rate of the swaps was set to one month term SOFR to align the swaps to term SOFR in the 2022 credit facility. No other terms under the swap agreements were amended. As a result, we early adopted ASC Topic 848, Reference Rate Reform. This adoption had immaterial impact on our consolidated financial statements. Refer to Note 9, Debt and Financing Arrangements, and Note 6, Financial Instruments, for further discussion of the transaction. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | REVENUE The following tables disaggregate our revenue by source (in thousands): For the Year Ended December 31, 2022 Financial Benefits and National Consolidated Accounting, tax, advisory and consulting $ 1,010,068 $ — $ — $ 1,010,068 Core Benefits and Insurance Services — 342,063 — 342,063 Non-core Benefits and Insurance Services — 15,944 — 15,944 Managed networking, hardware services — — 33,503 33,503 National Practices consulting — — 10,401 10,401 Total revenue $ 1,010,068 $ 358,007 $ 43,904 $ 1,411,979 For the Year Ended December 31, 2021 Financial Benefits and National Consolidated Accounting, tax, advisory and consulting $ 734,026 $ — $ — $ 734,026 Core Benefits and Insurance Services — 319,684 — 319,684 Non-core Benefits and Insurance Services — 12,639 — 12,639 Managed networking, hardware services — — 28,456 28,456 National Practices consulting — — 10,120 10,120 Total revenue $ 734,026 $ 332,323 $ 38,576 $ 1,104,925 For the Year Ended December 31, 2020 Financial Benefits and National Consolidated Accounting, tax, advisory and consulting $ 629,778 $ — $ — $ 629,778 Core Benefits and Insurance Services — 286,361 — 286,361 Non-core Benefits and Insurance Services — 11,397 — 11,397 Managed networking, hardware services — — 26,458 26,458 National Practices consulting — — 9,903 9,903 Total revenue $ 629,778 $ 297,758 $ 36,361 $ 963,897 Financial Services Revenue primarily consists of professional service fees derived from traditional accounting services, tax return preparation, administrative services, financial and risk advisory, consulting and valuation services. Clients are billed for these services based upon a fixed-fee, an hourly rate, or an outcome-based fee. Time related to the performance of all services is maintained in a time and billing system. Revenue for fixed-fee arrangements is recognized over time with the performance obligation measured in hours worked and anticipated realization. Anticipated realization is defined as the fixed fee divided by the product of the hours anticipated to complete a performance obligation and the standard billing rate. Anticipated realization rates are applied to hours charged to a contract when recognizing revenue. At the end of each reporting period, we evaluate the work performed to date to ensure that the amount of revenue recognized in each reporting period for the client arrangement is equal to the performance obligations met. Time and expense arrangement revenue is recognized over time with progress measured towards completion with value being transferred through our hourly fee arrangement at expected net realizable rates per hour, plus agreed-upon out-of-pocket expenses. The cumulative impact on any subsequent revision in the estimated realizable value of unbilled fees for a particular client project is reflected in the period in which the change becomes known. Prior to recognizing revenue for outcome-based arrangement, we estimate the transaction price, including variable consideration that is subject to a constraint based on risks specific to the arrangement. We evaluate the estimate in each reporting period and recognize revenue to the extent it is probable that a significant reversal of revenue will not occur. Revenue is recognized when the constraint is lifted at a point in time when the value is determined and verified by a third party. Benefits and Insurance Services Benefits and Insurance Services provides brokerage and consulting along lines of service which include group health benefits consulting and brokerage, property and casualty brokerage, retirement plan advisory, payroll, human capital management, actuarial, life insurance and other related services. Revenue consists primarily of fee income for administering health and retirement plans and brokerage commissions. Revenue also includes investment income related to client payroll funds that are held in CBIZ accounts, as is industry practice. We pay commissions monthly and require the recipient of the commission to be employed as of the end of the month in which the commissions are earned (as opposed to at the time of actual payment). Failure to remain employed at the date the commission is payable results in the forfeiture of commissions that would otherwise be due. Therefore, we have determined that the requirement of continued employment is substantive and accordingly, do not consider the commissions to be incremental costs of obtaining the customer contract and consequently a contract acquisition cost is not recognized for those commissions. Revenue related to group health benefits consulting consists of (i) commissions, (ii) fee income which can be fixed or variable based on a price per participant and (iii) contingent revenue. • Commission revenue and fee income are recognized over the contract period as these services are provided to clients continuously throughout the term of the arrangement. Our customers benefit from each month of service on its own and although volume and the number of participants may differ month to month, our obligation to perform substantially remains the same. • Contingent revenue arrangements are related to carrier-based performance targets. Due to the uncertainty of the outcome and the probability that a change in estimate would result in a significant reversal of revenue, we have applied a constraint on recording contingent revenue. Revenue is recognized when the constraint has been lifted which is the earlier of written notification from a carrier that the target has been achieved or cash collection. Contingent revenue is not a significant revenue stream to our consolidated financial position or results of operations. Revenue related to property and casualty consists of (i) commissions and (ii) contingent revenue. • Commissions relating to agency billing arrangements (pursuant to which we bill the insured, collect the funds and forward the premium to the insurance carrier less our commission) and direct billing arrangements (pursuant to which the insurance carrier bills the insured directly and forwards the commission to us) are both recognized on the effective date of the policy. Commission revenue is reported net of reserves for estimated policy cancellations and terminations. The cancellation and termination reserve is based upon estimates and assumptions using historical cancellation and termination experience and other current factors to project future experience. • Contingent revenue arrangements related to carrier-based performance targets include claim loss experience and other factors. Due to the uncertainty of the outcome and the probability that a change in estimate would result in a significant reversal of revenue, we have applied a constraint on recording contingent revenue. Revenue is recognized when the constraint has been lifted which is the earlier of written notification from a carrier that the target has been achieved or cash collection. Contingent revenue is not a significant revenue stream to our consolidated financial position or results of operations. Revenue related to retirement plan services consist of advisory, third party administration and actuarial services. • Advisory revenue is either (i) based on the value of assets under management, as provided by a third party, multiplied by an agreed upon rate, (ii) fee based, or (iii) a combination of fixed fee and value of assets under management. Advisory services revenue, derived from the value of assets under management, is calculated monthly or quarterly based on the estimated value of assets under management, as it is earned over the duration of the reporting period and relates to performance obligations satisfied during that period. The variability related to the estimated asset values used to recognize revenue during the reporting period is resolved and the amount of related revenue recognized is adjusted when the actual value of assets under management is known. Fee based Advisory revenue is recognized over the contract period as these services are provided to clients continuously throughout the term of the arrangement. Our clients benefit from each month of service on its own, and although the volume of tasks may differ month to month, our obligation to perform substantially remains the same. • Third party administration revenue is recognized over the contract period as these services are provided to clients continuously throughout the term of the arrangement. Our clients benefit from each month of service on its own, and although the volume of tasks may differ month to month, our obligation to perform substantially remains the same. • Actuarial revenue is recognized over the contract period with performance measured in hours in relation to the expected total hours. Under certain defined benefit plan administration arrangements, we charge new clients an initial, non-refundable, set-up fee as part of a multi-year service agreement. Revenue and costs related to the set-up fees are deferred and recognized over the life of the contract or the expected customer relationship, whichever is longer. Revenue related to payroll processing consists of a (i) fixed fee or (ii) variable fee based on a price per employee or check processed. Revenue is recognized when the actual payroll processing occurs. Our customers benefit from each month of service on its own and although volume and the variability may differ month to month, our obligation to perform substantially remains the same. Non-core Benefits and Insurance Services consists of transactional businesses that tend to fluctuate. These include life insurance, talent and compensation services. National Practices Managed networking, hardware services revenue consists of installation, maintenance and repair of computer hardware. These services are charged to a single customer based on cost plus an agreed-upon markup percentage, which has existed since 1999. National Practices consulting revenue is based upon a fixed fee, an hourly rate, or outcome-based. Revenue for fixed fee and time and expense arrangements is recognized over the performance period based upon actual hours incurred, while revenue for outcome-based arrangements is recognized similar to the outcome-based arrangements in the Financial Services practice group. Transaction Price Allocated to Future Obligations - The revenue recognition standard requires the disclosure of the aggregate amount of transaction price allocated to performance obligations that have not yet been satisfied as of the reporting date. The guidance provides certain practical expedients that limit this requirement, including performance obligations that are part of a contract that is one year or less. Since the majority of our contracts are one year or less, we have applied this practical expedient related to quantifying remaining performance obligations. In regards to contracts with terms in excess of one year, certain contract periods related to our government healthcare consulting, group health and benefits consulting, and property and casualty insurance businesses have an original specified contract duration in excess of one year, however, the agreements provide CBIZ and the client with the right to cancel or terminate the contract with no substantial penalty. We have applied the provisions of Topic 606 and the FASB Transition Resource Group memo number 10-14, and note that the definition of contract duration does not extend beyond the goods and services already transferred for contracts that provide both the Company and the client with the right to cancel or terminate the contract with no substantial penalty. |
Accounts Receivable, Net
Accounts Receivable, Net | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Accounts Receivable, Net | ACCOUNTS RECEIVABLE, NET Accounts receivable, net balances at December 31, 2022 and 2021 were as follows (in thousands): 2022 2021 Trade accounts receivable $ 267,409 $ 190,710 Unbilled revenue, at net realizable value 87,890 67,616 Total accounts receivable 355,299 258,326 Allowance for doubtful accounts (20,801) (16,158) Accounts receivable, net $ 334,498 $ 242,168 Changes in the allowance for doubtful accounts on accounts receivable are as follows (in thousands): 2022 2021 2020 Balance at beginning of period $ (16,158) $ (14,894) $ (14,379) Provision (13,545) (9,422) (9,323) Charge-offs, net of recoveries 8,902 8,158 8,808 Balance at end of period $ (20,801) $ (16,158) $ (14,894) |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | PROPERTY AND EQUIPMENT, NET Property and equipment, net at December 31, 2022 and 2021 consisted of the following (in thousands): 2022 2021 Buildings and leasehold improvements $ 47,300 $ 41,894 Furniture and fixtures 30,369 29,588 Capitalized software 34,735 34,474 Equipment 32,927 27,206 Total property and equipment 145,331 133,162 Accumulated depreciation (100,147) (89,739) Property and equipment, net $ 45,184 $ 43,423 Depreciation expense for property and equipment was $11.2 million, $10.8 million and $9.6 million in 2022, 2021 and 2020, respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets, Net | GOODWILL AND OTHER INTANGIBLE ASSETS, NET A summary of changes in the carrying amount of goodwill by operating segment for the years ended December 31, 2022 and 2021 were as follows (in thousands): Financial Benefits and National Total Gross $ 412,086 $ 321,111 $ 33,873 $ 767,070 Accumulated impairment $ (44,047) $ (7,733) $ (32,207) $ (83,987) Net at December 31, 2020 $ 368,039 $ 313,378 $ 1,666 $ 683,083 Additions 58,646 1,800 — 60,446 Divestitures — (2,786) — (2,786) Gross 470,732 320,125 33,873 824,730 Accumulated impairment (44,047) (7,733) (32,207) (83,987) Net at December 31, 2021 $ 426,685 $ 312,392 $ 1,666 $ 740,743 Additions 79,147 — — 79,147 Other adjustment 27 — — 27 Gross 549,906 320,125 33,873 903,904 Accumulated impairment (44,047) (7,733) (32,207) (83,987) Net at December 31,2022 $ 505,859 $ 312,392 $ 1,666 $ 819,917 We review goodwill at the reporting unit level at least annually, as of November 1, for impairment. We had five reporting units at November 1, 2022. No goodwill impairment was recognized as a result of the annual evaluation. The components of goodwill and other intangible assets, net at December 31, 2022 and 2021 were as follows (in thousands): 2022 2021 Goodwill $ 819,917 $ 740,743 Intangibles : Client lists 302,822 249,422 Other intangibles 11,463 11,454 Total intangibles 314,285 260,876 Total goodwill and other intangibles assets 1,134,202 1,001,619 Accumulated amortization: Client lists (173,286) (152,326) Other intangibles (9,214) (8,510) Total accumulated amortization (182,500) (160,836) Goodwill and other intangible assets, net $ 951,702 $ 840,783 Amortization expense for client lists and other intangible assets was $21.7 million, $16.3 million and $13.6 million in 2022, 2021 and 2020, respectively. The weighted-average useful lives of total intangible assets, client lists and other intangible assets were 7.6 years, 7.7 years and 5.3 years, respectively. Other intangible assets are amortized over periods ranging from 3 to 15 years. Based on the amount of intangible assets subject to amortization at December 31, 2022, the estimated amortization expense is $20.7 million for 2023, $19.2 million for 2024, $17.8 million for 2025, $15.8 million for 2026, $14.7 million for 2027, and $43.5 million thereafter. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | FINANCIAL INSTRUMENTS The carrying amounts of our cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short maturity of these instruments and are classified as Level 1 in the fair value hierarchy. The carrying value of bank debt approximates fair value, as the interest rate on the bank debt is variable and approximates current market rates. As a result, the fair value measurement of our bank debt is classified as Level 2 in the fair value hierarchy. Concentrations of Credit Risk - Financial instruments that may subject us to concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable. We place our cash and cash equivalents with highly-rated financial institutions, limiting the amount of credit exposure with any one financial institution. Our client base consists of large numbers of geographically diverse customers dispersed throughout the United States; thus, concentration of credit risk with respect to accounts receivable is not significant. Available-For-Sale Debt Securities - Available-for-sale debt securities consist primarily of corporate and municipal bonds. The net par values of these securities total $44.4 million and $37.0 million at December 31, 2022 and 2021, respectively. The bonds have maturity dates or callable dates ranging from January 2023 through November 2025, and are included in “Funds held for clients — current” in the accompanying Consolidated Balance Sheets based on our intent and ability to sell these investments at any time under favorable conditions. At December 31, 2022, unrealized losses on the securities were not material and have not been recognized as a credit loss because the bonds are investment grade quality and management is not required or does not intend to sell prior to an expected recovery in value. The bond issuers continue to make timely principal and interest payments. The following table summarizes our bond activity for the years ended December 31, 2022 and 2021 (in thousands): 2022 2021 Fair value at January 1 $ 38,670 $ 25,708 Purchases 19,771 26,980 Redemptions (5,630) (6,530) Maturities (6,770) (8,347) Change in bond premium (645) 1,517 Fair market value adjustment (1,911) (658) Fair value at December 31 $ 43,485 $ 38,670 In addition to the available-for-sale securities discussed above, we also held other depository assets in the amount of $0.9 million and $1.1 million at December 31, 2022 and December 31, 2021, respectively. Those depository assets are classified as Level 1 in the fair value hierarchy. Interest Rate Swaps - We utilize interest rate swaps to manage interest rate risk exposure associated with our floating-rate debt under the 2022 credit facility, or the forecasted acquisition of such liability. To mitigate counterparty credit risk, we only enter into contracts with selected major financial institutions with investment grade ratings and continually assess their creditworthiness. There are no credit risk-related contingent features in our interest rate swaps nor do the swaps contain provisions under which we would be required to post collateral. We do not purchase or hold any derivative instruments for trading or speculative purposes. The designation of a derivative instrument as a hedge and its ability to meet the hedge accounting criteria determine how we reflect the change in fair value of the derivative instrument. A derivative qualifies for hedge accounting treatment if, at inception, it meets defined correlation and effectiveness criteria. These criteria require that the anticipated cash flows and/or changes in fair value of the hedging instrument substantially offset those of the position being hedged. We had no fair value hedging instruments at December 31, 2022 or 2021. Our interest rate swaps are designated as cash flow hedges. Accordingly, the interest rate swaps are recorded as either an asset or liability in the accompanying Consolidated Balance Sheets at fair value. The mark-to-market gains or losses on the swaps are deferred and included as a component of accumulated other comprehensive loss (“AOCL”), net of tax, to the extent the hedge is determined to be effective, and reclassified to interest expense in the same period during which the hedged transaction affects earnings. The interest rate swaps are assessed for effectiveness and continued qualification for hedge accounting on a quarterly basis. For the years ended December 31, 2022 and 2021, the interest rate swaps were deemed to be highly effective. As a result of the 2022 credit facility, CBIZ amended the interest rate swap agreements with respect to the existing swaps. Effective May 16, 2022, the scheduled reset date, the interest rate of the swaps are set to one-month term SOFR to align the swaps to term SOFR in the 2022 credit facility as a result of reference rate reform. No other terms under the swap agreements were amended. The following table summarizes our outstanding interest rate swaps and their classification in the accompanying Consolidated Balance Sheets at December 31, 2022 and 2021 (in thousands). Refer to Note 7, Fair Value Measurements, to the accompanying consolidated financial statements for additional disclosures regarding fair value measurements. December 31, 2022 Notional Fixed Rate Expiration Fair Balance Sheet Location Interest rate swap $ 15,000 2.571 % 6/1/2023 $ 133 Other current asset Interest rate swap $ 50,000 0.834 % 4/14/2025 $ 3,726 Other non-current asset Interest rate swap $ 30,000 1.186 % 12/14/2026 $ 2,871 Other non-current asset Interest rate swap $ 20,000 2.450 % 8/14/2027 $ 1,079 Other non-current asset December 31, 2021 Notional Fixed Rate Expiration Fair Balance Sheet Location Interest rate swap $ 20,000 1.770 % 5/14/2022 $ (120) Other current liability Interest rate swap $ 15,000 2.640 % 6/1/2023 $ (432) Other non-current liability Interest rate swap $ 50,000 0.885 % 4/14/2025 $ 405 Other non-current asset Interest rate swap $ 30,000 1.249 % 12/14/2026 $ (64) Other non-current liability During the third quarter of 2022, we entered into a new 5-year interest rate swap with a notional value of $20 million and fixed rate of 2.450%. One interest rate swap with a notional value of $20 million and fixed rate of 1.770% expired during the second quarter of 2022. As of December 31, 2022, we have four interest rate swaps outstanding. Under the terms of the interest rate swaps, we pay interest at a fixed rate of interest plus applicable margin as stated in the amended agreements, and receive interest that varies with the one-month term SOFR. During the next twelve months, the amount of the December 31, 2022 AOCL balance that will be reclassified to earnings is expected to be immaterial. The following table summarizes the effects of the interest rate swap on our accompanying Consolidated Statements of Comprehensive Income for the years ended December 31, 2022 and 2021 (in thousands): Gain recognized in Gain (loss) reclassified from Twelve Months Ended December 31, Twelve Months Ended December 31, Location 2022 2021 2022 2021 Interest rate swaps $ 6,255 $ 929 $ 357 $ (1,152) Interest expense |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS FASB ASC Topic 820, Fair Value Measurements and Disclosures, establishes a fair value hierarchy that requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value is defined as the price that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The inputs used to measure fair value are classified into the following hierarchy: • Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities • Level 2 — Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability • Level 3 — Unobservable inputs for the asset or liability We endeavor to utilize the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As circumstances change, we will reassess the level in which the inputs are included in the fair value hierarchy. For the years ended December 31, 2022 and 2021, there were no transfers between the valuation hierarchy Levels 1, 2 and 3. The following table summarizes our assets and (liabilities) at December 31, 2022 and 2021 that are measured at fair value on a recurring basis subsequent to initial recognition and indicates the fair value hierarchy of the valuation techniques utilized by us to determine such fair value (in thousands): Level December 31, 2022 December 31, 2021 Deferred compensation plan assets 1 118,862 136,321 Available-for-sale debt securities 1 43,485 38,670 Other depository assets 1 868 1,144 Deferred compensation plan liabilities 1 (118,862) (136,321) Interest rate swaps, net 2 7,809 (211) Contingent purchase price liabilities 3 (132,010) (79,139) Contingent Purchase Price Liabilities - During the years ended December 31, 2022 and 2021, we recorded expense of $2.4 million and expense of $2.4 million, respectively, due to accretion, adjusting for expected results of acquired businesses and the revaluation of stock related to contingent payments. These changes are included in Other (expense) income, net in the accompanying Consolidated Statements of Comprehensive Income. Refer to Note 18, Business Combinations, for further discussion of our acquisitions and contingent purchase price liabilities. The following table summarizes the change in fair value of our contingent purchase price liabilities identified as Level 3 for the years ended December 31, 2022 and 2021 (pre-tax basis, in thousands): Contingent Beginning balance — January 1, 2021 $ (54,391) Additions from business acquisitions (39,666) Settlement of contingent purchase price payable 17,285 Change in fair value of contingency (554) Change in net present value of contingency (1,813) Balance — December 31, 2021 $ (79,139) Additions from business acquisitions (74,199) Settlement of contingent purchase price payable 23,763 Change in fair value of contingency 662 Change in net present value of contingency (3,097) Balance — December 31, 2022 $ (132,010) |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES For financial reporting purposes, income from continuing operations before income taxes includes the following components (in thousands): 2022 2021 2020 United States $ 141,306 $ 92,847 $ 103,306 Foreign (Canada) 187 193 182 Total $ 141,493 $ 93,040 $ 103,488 Income tax expense included in the accompanying Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020 was as follows (in thousands): 2022 2021 2020 Continuing operations: Current: Federal $ 20,910 $ 12,369 $ 21,926 Foreign 50 52 78 State and local 7,299 3,397 5,584 Total 28,259 15,818 27,588 Deferred: Federal 5,667 5,029 (1,968) State and local 2,195 1,282 (479) Total 7,862 6,311 (2,447) Total income tax expense from continuing operations 36,121 22,129 25,141 Discontinued operations: Operations of discontinued operations: Current (7) (5) (11) Total income tax benefit from discontinued (7) (5) (11) Total income tax expense $ 36,114 $ 22,124 $ 25,130 The provision for income taxes attributable to income from continuing operations differed from the amount obtained by applying the federal statutory income tax rate to income from continuing operations before income taxes, as follows (in thousands, except percentages): 2022 2021 2020 Tax at U.S. federal statutory rates $ 29,714 $ 19,538 $ 21,733 State taxes (net of federal benefit) 9,019 4,498 5,354 Reserves for uncertain tax positions 337 (104) (1,290) Share-based compensation (6,832) (4,187) (2,394) Non-deductible officers' compensation 2,507 1,267 538 Other, net 1,376 1,117 1,200 Provision for income taxes from continuing operations $ 36,121 $ 22,129 $ 25,141 Effective income tax rate 25.5 % 23.8 % 24.3 % The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2022 and 2021, were as follows (in thousands): 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 1,473 $ 1,202 Allowance for doubtful accounts 4,682 3,613 Employee benefits and compensation 37,075 33,549 Lease costs 6,871 5,726 Deferral of employer FICA taxes — 1,961 Other deferred tax assets 574 778 Total gross deferred tax assets 50,675 46,829 Less: valuation allowance (3,156) (2,046) Total deferred tax assets, net 47,519 44,783 Deferred tax liabilities: Goodwill and other intangibles 68,306 57,990 Property and equipment 1,185 1,488 Other deferred tax liabilities 2,791 745 Total gross deferred tax liabilities 72,282 60,223 Deferred income taxes, net $ (24,763) $ (15,440) We have established valuation allowances for deferred tax assets related to certain employee benefits and compensation and state net operating loss (“NOL”) carryforwards at December 31, 2022 and December 31, 2021. The net increase in the valuation allowance of $1.2 million for the year ended December 31, 2022 related to changes in the valuation allowance for NOLs and certain employee benefits and compensation. In assessing the realization of deferred tax assets, management considers all available positive and negative evidence, including projected future taxable income, scheduled reversal of deferred tax liabilities, historical financial operations and tax planning strategies. Based upon review of these items, management believes it is more-likely-than-not that the Company will realize the benefits of these deferred tax assets, net of the existing valuation allowances. We file income tax returns in the United States, Canada, and most state jurisdictions. CBIZ's federal income tax returns for years ending prior to January 1, 2019 are no longer subject to examination. With limited exceptions, our state and local income tax returns and non-U.S. income tax returns are no longer subject to tax authority examinations for years ending prior to January 1, 2018 and January 1, 2017, respectively. The availability of NOLs and state tax credits are reported as deferred tax assets, net of applicable valuation allowances, in the accompanying Consolidated Balance Sheets. At December 31, 2022, we had state net operating loss carryforwards of $48.0 million and a state tax credit carryforward of $0.2 million. The state net operating loss carryforwards expire on various dates between 2023 and 2042 and the state tax credit carryforward expires in 2027. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): 2022 2021 2020 Balance at January 1 $ 1,594 $ 1,536 $ 2,536 Additions for tax positions of the current year 175 161 150 Additions for positions of prior years 486 400 — Settlements of prior year positions — (374) — Lapse of statutes of limitation (144) (129) (1,150) Balance at December 31 $ 2,111 $ 1,594 $ 1,536 Included in the balance of unrecognized tax benefits at December 31, 2022 are $1.4 million of unrecognized tax benefits that, if recognized, would affect the effective tax rate. We believe it is reasonably possible that certain of these unrecognized tax benefits could change in the next twelve months. We expect reductions in the liability for unrecognized tax benefits of approximately $0.1 million within the next twelve months due to expiration of statutes of limitation. Given the number of years that are currently subject to examination, we are unable to estimate the range of potential adjustments to the remaining balance of unrecognized tax benefits at this time. We recognize interest expense and penalties related to unrecognized tax benefits as a component of income tax expense. During 2022, we recorded an immaterial increase in accrued interest, and, as of December 31, 2022, we had recognized a liability for interest expense and penalties of $0.3 million and $0.2 million, respectively, relating to unrecognized tax benefits. During 2021, we recorded an immaterial decrease in accrued interest, and, as of December 31, 2021, we had recognized a liability for interest expense and penalties of $0.2 million and $0.2 million, respectively, relating to unrecognized tax benefits. |
Debt and Financing Arrangements
Debt and Financing Arrangements | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt and Financing Arrangements | DEBT AND FINANCING ARRANGEMENTS 2022 credit facility On May 4, 2022, we entered into the 2022 credit facility, which amends the 2018 credit facility. The 2022 credit facility increased our borrowing capacity from $400 million to $600 million, which provides us with the capital necessary to meet our working capital needs as well as the flexibility to continue with our strategic initiatives, including business acquisitions and share repurchases. Other important key terms of the 2022 credit facility include: (i) an accordion feature that permits lenders to extend an additional $200 million at later date; (ii) no change in pricing from the 2018 credit facility; (iii) upsizing of baskets and various sublimits to reflect the increased size of the Company's business; (iv) a swing line facility increase from $25 million to $50 million, which provides for same-day funds to cover daily liquidity needs; and (v) base interest rate amended from LIBOR to term SOFR. In connection with our 2022 credit facility, we incurred approximately $2.1 million of financing costs during the second quarter of 2022. The financing costs are deferred and reported as a reduction of debt on the accompanying Consolidated Balance Sheets, are included as a component of cash flow from financing activities on the accompanying Consolidated Statements of Cash Flows, and are being amortized as interest expense over the term of the 2022 credit facility. In addition, we wrote-off approximately $41 thousand of unamortized deferred cost associated with the 2018 credit facility as additional interest expense in the second quarter of 2022. The 2022 credit facility matures on May 4, 2027. The balance outstanding under the 2022 credit facility was $265.7 million at December 31, 2022. The balance outstanding under the 2018 credit facility was $155.3 million at December 31, 2021. The combined effective interest rates under the 2018 and 2022 credit facilities, including the impact of interest rate swaps associated with those credit facilities, were as follows: 2022 2021 Weighted average rates 2.67% 1.88% Range of effective rates 1.08% - 5.44% 1.06% - 3.64% We had approximately $319.9 million of available funds under the 2022 credit facility at December 31, 2022, based on the terms of the commitment. Available funds under the credit facility are based on a multiple of earnings before interest, taxes, depreciation and amortization as defined in the credit facility, and are reduced by letters of credit, other indebtedness and outstanding borrowings under the credit facility. Under the 2022 credit facility, loans are charged an interest rate consisting of a base rate or term SOFR rate plus an applicable margin, letters of credit are charged based on the same applicable margin, and a commitment fee is charged on the unused portion of the credit facility. The 2022 credit facility contains certain restrictive covenants customary for facilities of this type, including restrictions on indebtedness, liens or other encumbrances, making certain payments, investments, or to sell or otherwise dispose of a substantial portion of assets, or to merge or consolidate with an unaffiliated entity. The 2022 credit facility also limits our ability to make dividend payments. Historically, we have not paid cash dividends on our common stock. Our Board of Directors has discretion over the payment and level of dividends on common stock, subject to the limitations of the credit facility and applicable law. The credit facility contains a provision that, in the event of a defined change in control, the credit facility may be terminated. In addition, the 2022 credit facility contains financial covenants that require us to meet certain requirements with respect to (i) a total leverage ratio and (ii) minimum interest charge coverage ratio which may limit our ability to borrow up to the total commitment amount. As of December 31, 2022, we are in compliance with all covenants. Other line of credit We have an unsecured $20.0 million line of credit by and among CBIZ Benefits and Insurance, Inc., our wholly owned subsidiary, and the Huntington Bank. We utilize this line of credit to support our short-term funding requirements of payroll client fund obligations due to the investment of client funds, rather than liquidating client funds that have already been invested in available-for-sale securities. Refer to Note 6, Financial Instruments, for further discussion regarding these investments. The line of credit, which was renewed on August 1, 2022 and will terminate on August 3, 2023, did not have a balance outstanding at December 31, 2022 and 2021. Borrowings under the line of credit bear interest at the prime rate. Interest expense Interest expense, including amortization of deferred financing costs, commitment fees, line of credit fees, and other applicable bank charges, was as follows (in thousands): 2022 2021 2020 Credit facilities $ 8,033 $ 3,843 $ 4,919 Other line of credit 6 — 1 Other — 25 63 $ 8,039 $ 3,868 $ 4,983 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The components of accumulated other comprehensive income (loss) at December 31, 2022 and 2021 were as follows (in thousands): 2022 2021 Net unrealized loss on available-for-sale securities, net of income tax benefit of $571 and $51, respectively $ (1,518) $ (127) Net unrealized income (loss) on interest rate swap, net of income tax expense (benefit) of $1,924 and $(41), respectively 5,885 (101) Foreign currency translation (763) (739) Accumulated other comprehensive income (loss) $ 3,604 $ (967) |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Acquisitions - The purchase price that we normally pay for businesses and client lists consists of two components: an up-front non-contingent portion, and a portion which is contingent upon the acquired businesses or client lists’ future performance. The fair value of the contingent purchase price consideration is recorded at the date of acquisition and re-measured each reporting period until the liability is settled. Shares of our common stock that are issued in connection with acquisitions may be contractually restricted from sale for periods up to one year. Acquisitions are further disclosed in Note 18, Business Combinations. Indemnifications - We have various agreements in which we may be obligated to indemnify the other party with respect to certain matters. Generally, these indemnification clauses are included in contracts arising in the normal course of business under which the Company customarily agrees to hold the other party harmless against losses arising from a breach of representations, warranties, covenants or agreements, related to matters such as title to assets sold and certain tax matters. Payment by us under such indemnification clauses are generally conditioned upon the other party making a claim. Such claims are typically subject to challenge by us and to dispute resolution procedures specified in the particular contract. Further, our obligations under these agreements may be limited in terms of time and/or amount and, in some instances, we may have recourse against third parties for certain payments made by us. It is not possible to predict the maximum potential amount of future payments under these indemnification agreements due to the conditional nature of our obligations and the unique facts of each particular agreement. Historically, we have not made any payments under these agreements that have been material individually or in the aggregate. As of December 31, 2022, we were not aware of any obligations arising under indemnification agreements that would require material payments, and therefore have not recorded a liability. Employment Agreements - We maintain severance and employment agreements with certain of our executive officers, whereby such officers may be entitled to payment in the event of termination of their employment. We also have arrangements with certain non-executive employees which may include severance and other employment provisions. We accrue for amounts payable under these contracts and arrangements as triggering events occur and obligations become known. During the years ended December 31, 2022, 2021 and 2020, payments under such contracts and arrangements were not material. Letters of Credit and Guarantees - We provide letters of credit to landlords (lessors) of our leased premises in lieu of cash security deposits, which totaled $5.0 million and $3.4 million at December 31, 2022 and 2021, respectively. In addition, we provide license bonds to various state agencies to meet certain licensing requirements. The amount of license bonds outstanding was $2.3 million and $2.3 million at December 31, 2022 and 2021, respectively. Legal Proceedings - On December 19, 2016, CBIZ Operations was named as a defendant in a lawsuit filed by Zotec Partners, LLC ("Zotec") in the Marion County Indiana Superior Court. After various amendments, the lawsuit asserts claims under Indiana law for securities, statutory and common law fraud or deception, unjust enrichment, breach of contract, and vicarious liability against CBIZ Operations and a former employee of CBIZ MMP in connection with the sale of the CBIZ MMP medical billing practice to Zotec. The plaintiff claims that CBIZ Operations had a duty to disclose the fact, unknown to employees of CBIZ Operations at the time of the transaction, that the former employee had a financial arrangement with a Zotec vendor at the time CBIZ Operations sold CBIZ MMP to Zotec. The plaintiff is seeking damages of up to $177.0 million out of the $200.0 million transaction price. Trial was held in October 2021. The jury found in favor of CBIZ on all fraud, contract and other claims before it. On November 14, 2022, the trial court ruled in favor of CBIZ and against Zotec’s claim for statutory securities fraud. The court also ruled in favor of CBIZ on its counterclaim for indemnification under contract. The trial court is expected to set further proceedings to determine the amount of damages owed by Zotec to CBIZ. In addition to the item disclosed above, the Company is, from time to time, subject to claims and lawsuits arising in the ordinary course of business. We cannot predict the outcome of all such matters or estimate the possible loss, if any. Although the proceedings are subject to uncertainties in the litigation process and the ultimate disposition of these proceedings is not presently determinable, we intend to vigorously defend these matters. |
Employee Benefits
Employee Benefits | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Employee Benefits | EMPLOYEE BENEFITS Employee Savings Plan - We sponsor a qualified 401(k) defined contribution plan that covers substantially all of our employees. Participating employees may elect to contribute, on a tax-deferred basis, up to 80% of their pre-tax annual compensation (subject to a maximum permissible contribution under Section 401(k) of the Internal Revenue Code). Matching contributions by us are 50% of the first 6% of base compensation that the participant contributes, and additional amounts may be contributed at the discretion of the Board of Directors. Participants may elect to invest their contributions in various funds including: equity, fixed income, stable value, and balanced-lifecycle funds. Employer contributions (net of forfeitures) made to the plan during the years ended December 31, 2022, 2021 and 2020 were approximately $16.1 million, $13.2 million and $12.2 million, respectively. Non-qualified Deferred Compensation Plan - We sponsor a non-qualified deferred compensation plan, under which certain members of management and other highly compensated employees may elect to defer receipt of a portion of their annual compensation, subject to maximum and minimum percentage limitations. The amount of compensation deferred under the plan is credited to each participant’s deferral account and a non-qualified deferred compensation plan obligation is established by us. An amount equal to each participant’s compensation deferral is transferred into a rabbi trust and invested in various debt and equity securities as directed by the participants. The assets of the rabbi trust are held by us and recorded as “Assets of deferred compensation plan” in the accompanying Consolidated Balance Sheets. Assets of the non-qualified deferred compensation plan consist primarily of investments in mutual funds, money market funds and equity securities. The values of these investments are based on published market prices at the end of the period. Adjustments to the fair value of these investments are recorded in “Other income, net,” offset by the same adjustments to compensation expense (recorded as “Operating expenses” or “G&A expenses” in the accompanying Consolidated Statements of Comprehensive Income). We recorded a loss of $19.6 million related to those investments for the year ended December 31, 2022. In 2021 and 2020, respectively, we recorded income of $19.5 million and $15.4 million related to these investments. These investments are specifically designated as available to us solely for the purpose of paying benefits under the non-qualified deferred compensation plan. However, the investments in the rabbi trusts would be available to all unsecured general creditors in the event that we become insolvent. Deferred compensation plan obligations represent amounts due to plan participants and consist of accumulated participant deferrals and changes in fair value of investments thereon since the inception of the plan, net of withdrawals. This liability is an unsecured general obligation of ours and is recorded as “Deferred compensation plan obligations” in the accompanying Consolidated Balance Sheets. The assets and liabilities related to the non-qualified deferred compensation plan at December 31, 2022 and 2021 were $118.9 million and $136.3 million, respectively. |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Common Stock | COMMON STOCK Share Repurchase Program - Our Board of Directors approved various share repurchase programs that were effective during the years ended December 31, 2022 and 2021. Under these programs, shares may be purchased in the open market or in privately negotiated transactions according to SEC rules. The Share Repurchase Program does not obligate us to acquire any specific number of shares and may be suspended at any time. Repurchased shares are held in treasury and may be reserved for future use in connection with acquisitions, employee share plans and other general purposes. Under the 2022 credit facility, described in Note 9, Debt and Financing Arrangements, share repurchases are unlimited when total leverage is less than 3.0. When leverage is greater than 3.0, the annual share repurchase is limited to $35.0 million. Under the Share Repurchase Program, we repurchased 2.8 million and 3.0 million shares on the open market at a cost (including fees and commissions) of $122.8 million and $96.4 million during the years ended December 31, 2022 and 2021, respectively. Shares repurchased to settle statutory employee withholding related to vesting of stock awards were 0.2 million shares at a cost of $7.3 million during the year ended December 31, 2022 and 0.1 million shares at a cost of $3.0 million during the year ended December 31, 2021. |
Employee Stock Plans
Employee Stock Plans | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Employee Stock Plans | EMPLOYEE STOCK PLANS Employee Stock Purchase Plan - The 2007 Employee Stock Purchase Plan (“ESPP”), which has a termination date of June 30, 2024, allows qualified employees to purchase shares of common stock through payroll deductions up to a limit of $25,000 of stock per calendar year. The price an employee pays for shares is 85% of the fair market value of our common stock on the last day of the purchase period. Purchase periods begin on the sixteenth day of the month and end on the fifteenth day of the subsequent month. Other than a one-year holding period from the date of purchase, there are no vesting or other restrictions on the stock purchased by employees under the ESPP. The total number of shares of common stock that can be purchased under the ESPP shall not exceed 2.0 million shares. Stock Awards - Effective May 9, 2019, the CBIZ shareholders approved CBIZ, Inc. 2019 Stock Omnibus Incentive Plan (“2019 Plan”), which amended and restated the CBIZ, Inc. 2014 Stock Incentive Plan (“2014 Plan”), of which we have granted various stock-based awards through the year ended December 31, 2022. Effective January 1, 2020, the 2019 Plan replaced and superseded the 2014 Plan. The operating terms of the 2019 Plan are substantially similar to those of the 2014 Plan. Under the 2019 Plan, which expires in 2029, a maximum of 3.1 million stock options, restricted stock or other stock based compensation awards may be granted. Shares subject to award under the 2019 Plan may be either authorized but unissued shares of our common stock or treasury shares. The terms and vesting schedules for the share-based awards vary by type and date of grant. At December 31, 2022, approximately 1.8 million shares were available for future grant under the 2019 Plan. During the years ended December 31, 2022, 2021 and 2020, we recognized compensation expense (before income tax expense) for these awards as follows (in thousands): 2022 2021 2020 Stock options $ 248 $ 1,291 $ 1,878 Restricted stock units and awards 5,204 5,603 4,960 Performance share units 9,237 4,513 2,031 Total share-based compensation expense $ 14,689 $ 11,407 $ 8,869 Stock Options - Certain employees and non-employee directors were granted stock options. Stock options awarded to non-employee directors have generally been granted with immediate vesting. Stock options awarded to employees are generally subject to a 25% incremental vesting schedule over a four-year period commencing from the date of grant. At the discretion of the Compensation Committee of the Board of Directors, options awarded under the 2019 Plan may vest in a time period shorter than four years. Stock options expire six years from the date of grant and are awarded with an exercise price equal to the market value of our common stock on the date of grant. Stock options may be granted alone or in addition to other awards and may be of two types: incentive stock options and non-qualified stock options. During the year ended December 31, 2021 and 2020, we granted 50 thousand and 50 thousand stock options to non-employee directors, respectively. We did not grant any stock options during the year ended December 31, 2022. Stock option activity during the year ended December 31, 2022 was as follows (number of options in thousands): Number of Weighted Weighted Aggregate Outstanding at December 31, 2021 1,223 $ 17.71 Exercised (670) $ 14.98 Outstanding at December 31, 2022 553 $ 21.03 1.83 years $ 14.3 Vested and exercisable at December 31, 2022 553 $ 21.03 1.83 years $ 14.3 • The weighted-average grant-date fair value of stock options granted during the years ended December 31, 2021 and 2020 was $0.4 million and $0.3 million, respectively. • The aggregate intrinsic value of stock options exercised during each of the years ended December 31, 2022, 2021 and 2020 was $19.1 million, $13.6 million and $8.9 million, respectively. The intrinsic value is calculated as the difference between our stock price on the exercise date and the exercise price of each option exercised. • At December 31, 2022, we didn't have any unrecognized compensation cost for stock options. We utilized the Black-Scholes-Merton option-pricing model to determine the fair value of stock options on the date of grant. The fair value of stock options granted during the years ended December 31, 2021 and 2020 were $8.10 and $5.79, respectively. The following weighted average assumptions were utilized: 2021 2020 Expected volatility (1) 27.49 % 27.27 % Expected option life (years) (2) 4.71 4.67 Risk-free interest rate (3) 0.74 % 0.19 % Expected dividend yield (4) — % — % (1) The expected volatility assumption was determined based upon the historical volatility of our stock price, using daily price intervals. (2) The expected option life was determined based upon our historical data using a midpoint scenario, which assumes all options are exercised halfway between the expiration date and the weighted average time it takes the option to vest. (3) The risk-free interest rate assumption was upon zero-coupon U.S. Treasury bonds with a term approximating the expected life of the respective options. (4) The expected dividend yield assumption was determined in view of our historical and estimated dividend payouts. Restricted Stock Units and Awards - Under the 2019 Plan, certain employees and non-employee directors were granted restricted stock units and awards. Restricted stock units and awards are independent of option grants and vest at no cost to the recipients. Restricted stock units and awards are subject to forfeiture if employment terminates prior to the release of restrictions, generally one . Restricted stock units and awards activity during the year ended December 31, 2022 was as follows (in thousands, except per share data): Number of Weighted Average Grant-Date Fair Value (1) Non-vested at December 31, 2021 389 $ 25.07 Granted 130 $ 38.53 Vested (238) $ 23.47 Forfeited (4) $ 34.04 Non-vested at December 31, 2022 277 $ 32.62 (1) Represents weighted average market value of the shares as the awards are granted at no cost to the recipients. • At December 31, 2022, we had unrecognized compensation cost for restricted stock units and awards of $5.2 million to be recognized over a weighted average period of approximately 0.73 years. • The total fair value of shares vested during the years ended December 31, 2022, 2021 and 2020 was approximately $5.6 million, $4.9 million and $4.6 million, respectively. • The market value of shares awarded during the years ended December 31, 2022, 2021 and 2020 was $5.0 million, $5.0 million and $4.3 million, respectively. This market value was recorded as unearned compensation and is recognized as expense ratably over the periods which the restrictions lapse. • Awards outstanding at December 31, 2022 will be released from restrictions at dates ranging from February, 2023 through February, 2025. Performance Share Units (“PSUs”) - PSUs are earned based on our financial performance over a contractual term of three years and the associated expense is recognized over that period based on the fair value of the award. A three-year cliff vesting schedule of the PSUs is dependent upon the Company’s performance relative to pre-established goals based on earnings per share target (weighted 70%) and total growth in revenue (weighted 30%). The fair value of PSUs is calculated using the market value of our common stock on the date of grant. For performance achieved above specified levels, the recipient may earn additional shares of stock, not to exceed 200% of the number of PSUs initially granted. The following table presents our PSUs award activity during the twelve months ended December 31, 2022 (in thousands, except per share data): Performance Share Units Weighted Average Grant-Date Fair Value Per Unit (1) Outstanding at December 31, 2021 473 $ 23.64 Granted 103 $ 38.15 Vested (211) $ 19.82 Adjustments for performance results (2) 122 $ 25.75 Forfeited (5) $ 33.21 Outstanding at December 31, 2022 482 $ 28.84 ( 1) Represents weighted average market value of the shares; awards are granted at no cost to the recipients. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE The following table sets forth the reconciliation of the numerator and the denominator of basic earnings per share and diluted earnings per share from continuing operations for the years ended December 31, 2022, 2021 and 2020 (in thousands, except per share data): Year Ended December 31, 2022 2021 2020 Numerator: Income from continuing operations $ 105,372 $ 70,911 $ 78,347 Denominator: Basic Weighted average common shares outstanding 51,502 52,637 54,288 Diluted Stock options (1) 487 683 802 Restricted stock awards 141 192 195 Contingent shares (2) 14 — 74 Performance share units (3) 244 211 — Diluted weighted average common shares outstanding 52,388 53,723 55,359 Earnings Per Share: Basic earnings per share from continuing operations $ 2.05 $ 1.35 $ 1.44 Diluted earnings per share from continuing operations $ 2.01 $ 1.32 $ 1.42 (1) For the years ended December 31, 2022, 2021 and 2020, a total of 68 thousand, 23 thousand and 253 thousand stock based awards, respectively, were excluded from the calculation of diluted earnings per share as their exercise prices would render them anti-dilutive. (2) Contingent shares represent additional shares to be issued for purchase price earned by former owners of businesses acquired by us once future conditions have been met. For further details, refer to Note 18, Business Combinations . (3) The denominator used in calculating diluted earnings per share did not include 0.2 million and 0.3 million performance share units for the twelve months ended December 31, 2022 and 2021, respectively. The performance conditions associated with these performance share units were not met and consequently none of these performance share units were considered as issuable for the years ended December 31, 2022 and 2021. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | LEASES We determine if a contract is a lease at inception. We have leases for office space and facilities, automobiles and certain information technology equipment. All of our leases are classified as operating leases and the majority of which are for office space and facilities. Supplemental balance sheet information related to the Company’s operating leases as of December 31, 2022 and 2021 was as follows (in thousands): December 31, 2022 December 31, 2021 Weighted-average remaining lease term 6.3 years 6.4 years Weighted-average discount rate 4.14 % 3.54 % The components of lease cost and other lease information as of and during the year ended December 31, 2022 and 2021 are as follows (in thousands): December 31, 2022 December 31, 2021 Operating lease cost $ 43,716 $ 35,584 Cash paid for amounts included in measurement of lease liabilities Operating cash flows for operating leases $ 45,378 $ 38,042 Our leases have remaining lease terms ranging from 1 to 10 years. These leases generally contain renewal options for periods ranging from two Maturities of operating lease liabilities at December 31, 2022 and minimum cash commitments under operating leases at December 31, 2021 were as follows (in thousands): December 31, 2022 2023 $ 44,595 2024 40,516 2025 38,978 2026 35,205 2027 31,230 Thereafter 51,756 Total undiscounted lease payments 242,280 Less: imputed interest (31,468) Total lease liabilities $ 210,812 December 31, 2021 2022 $ 36,202 2023 33,490 2024 29,153 2025 27,779 2026 23,213 Thereafter 50,311 Total undiscounted lease payments 200,148 Less: imputed interest (23,754) Total lease liabilities $ 176,394 |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Parties | RELATED PARTIES The following is a summary of certain agreements and transactions between or among us and certain related parties. Management reviews these transactions as they occur and monitors them for compliance with our Code of Conduct, internal procedures and applicable legal requirements. The Audit Committee reviews and ratifies such transactions annually, or as they are more frequently brought to the attention of the Audit Committee by our Director of Internal Audit, General Counsel or other members of Management. A number of the businesses acquired by us are located in properties owned indirectly by and leased from persons employed by us, none of whom are members of our senior management. In the aggregate, we paid approximately $1.9 million, $2.3 million and $2.2 million during the years ended December 31, 2022, 2021 and 2020, respectively, under such leases. Jerome Grisko, President and CEO of CBIZ, is a board member of Global Prairie PBC, Inc. ("Global Prairie"). Global Prairie performed consulting work for us during the year ended December 31, 2022 for which we paid approximately $0.2 million. We maintain joint-referral relationships and ASAs with independent licensed CPA firms under which we provide administrative services in exchange for a fee. These firms are owned by licensed CPAs who are employed by our subsidiaries and provide audit and attest services to clients including our clients. The CPA firms with which we maintain ASAs operate as limited liability companies, limited liability partnerships or professional corporations. The firms are separate legal entities with separate governing bodies and officers. We have no ownership interest in any of these CPA firms, and neither the existence of the ASAs nor the providing of services thereunder is intended to constitute control of the CPA firms by us. CBIZ and the CPA firms maintain their own respective liability and risk of loss in connection with performance of each of its respective services, and we do not believe that our arrangements with these CPA firms result in additional risk of loss. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | BUSINESS COMBINATIONS Our acquisition strategy focuses on businesses with a leadership team that is committed to best in class culture, extraordinary client service and cross-serving potential. CBIZ has a long history of acquiring businesses that share common cultural values with us and provide value-added services to the small and midsize business market. The valuation of any business is a subjective process and includes industry, geography, profit margins, expected cash flows, client retention, nature of recurring or non-recurring project-based work, growth rate assumptions and competitive market conditions. During the year ended December 31, 2022, we completed the following acquisitions: ◦ Effective January 1, 2022, we acquired all of the non-attest assets of Marks Paneth LLP ("Marks Paneth"). Marks Paneth, based in New York City, is a provider of a full range of accounting, tax and consulting services to a wide range of industries. Marks Paneth is included as a component of our Financial Services practice group. Operating results are reported in the Financial Services practice group. ◦ Effective July 1, 2022, we acquired substantially all the assets of Stinnett & Associates, LLC ("Stinnett"). Stinnett, located in Tulsa, Oklahoma, is a professional advisory firm and certified Women's Business Enterprise providing internal audit, Sarbanes-Oxley compliance, cybersecurity reviews, business continuity and disaster recovery, and fraud investigations to businesses of all sizes including Fortune 1000 organizations in a variety of industries. Operating results are reported in the Financial Services practice group. During the year ended December 31, 2021, we completed the following acquisitions: ◦ Effective January 1, 2021, we acquired substantially all the assets of Middle Market Advisory Group (“MMA”). MMA, based in Englewood, Colorado, is a provider of tax compliance and consulting services to middle market companies and family groups in the real estate, automotive, technology and SAAS, construction, and manufacturing industries. Operating results are reported in the Financial Services practice group. ◦ Effective April 1, 2021, we acquired substantially all the assets of Wright Retirement Services, LLC ("Wright"). Wright, located in Valdosta, Georgia, specializes in third party administration services for retirement plan sponsors. Operating results are reported in the Benefits and Insurance practice group. ◦ Effective May 1, 2021, we acquired substantially all of the non-attest assets of Berntson Porter & Company, PLLC ("BP"). BP, based in Bellevue, Washington, is a provider of comprehensive accounting and financial consulting services including tax, forensic, economic and valuation services and transaction services to a wide range of industries with specialties including construction, real estate, hospitality, manufacturing and technology. Operating results are reported in the Financial Services practice group. ◦ Effective June 1, 2021, we acquired all of the issued and outstanding membership interests of Schramm Health Partners, LLC dba Optumas ("Optumas"). Optumas, based in Scottsdale, Arizona, is a provider of actuarial services to state government health care agencies to assist in the administration of Medicaid programs. Operating results are reported in the Financial Services practice group. ◦ Effective September 1, 2021, we acquired all of the non-attest assets of Shea Labagh Dobberstein ("SLD"). SLD, based in San Francisco, California, is a provider of professional accounting, tax and advisory services to privately held businesses, individuals and nonprofit organizations. Operating results are reported in the Financial Services practice group. ◦ Effective December 1, 2021, we acquired substantially all the assets of Kenneth Weiss & Company, P.C. dba Weiss & Company (“Weiss”). Weiss, based in San Diego, California, is a provider of tax compliance and consulting services to family groups and individuals. Operating results are reported in the Financial Services practice group. The acquisitions of Marks Paneth and Stinnett added approximately $148.1 million in incremental revenue in 2022. During the year ended December 31, 2022, we recorded approximately $10.5 million in non-recurring transaction, retention and integration related costs associated with the Marks Paneth acquisition. Pro forma results of operations for these acquisitions have not been presented because the effects of these acquisitions were not material, either individually or in aggregate, to our total revenue, income from continuing operations, and net income for year ended December 31, 2022 and 2021, respectively. The following table summarizes the aggregated consideration and purchase price allocation for the acquisitions completed during the year ended December 31, 2022 and 2021, respectively (in thousands): 2022 2021 Common stock issued (number) 42 207 Common stock value $ 1,668 $ 6,940 Cash paid 79,141 66,651 Recorded contingent consideration 74,199 39,665 Total recorded purchase price $ 155,008 $ 113,256 Accounts receivable acquired, net $ 20,429 $ 9,838 Fixed assets acquired 1,933 1,473 Identifiable intangible assets acquired 53,400 42,422 Operating lease right-of-use asset acquired, net 49,291 19,153 Other assets acquired, net 1,693 848 Operating lease liability acquired - current (5,860) (3,020) Other current liabilities acquired (1,594) (1,771) Operating lease liability acquired - noncurrent (43,431) (16,133) Goodwill 79,147 60,446 Total net assets acquired $ 155,008 $ 113,256 Maximum potential contingent consideration $ 77,075 $ 41,720 The following table summarizes the aggregated goodwill and intangible asset amounts resulting from those acquisitions for the twelve months ended December 31, 2022 and 2021, respectively (in thousands): Twelve Months Ended December 31, 2022 2021 Financial Services Benefits & Insurance Financial Services Benefits & Insurance Goodwill $ 79,147 $ — $ 58,646 $ 1,800 Client list 53,400 — 40,950 1,290 Other intangibles — — 136 46 Total $ 132,547 $ — $ 99,732 $ 3,136 Goodwill is calculated as the difference between the aggregated purchase price and the fair value of the net assets acquired. Goodwill represents the value of expected future earnings and cash flows, as well as the synergies created by the integration of the new businesses within our organization, including cross-selling opportunities expected with our Financial Services practice group and the Benefits and Insurance Services practice group, to help strengthen our existing service offerings and expand our market position. Client lists generally have an expected life of 10 years, and other intangibles, primarily non-compete agreements, have an expected life of 3 years. Client lists and non-compete agreements are valued using a discounted cash flow technique based on management estimates of future cash flows from such assets. The following table summarizes the changes in contingent purchase price consideration for previous acquisitions and contingent payments made for previous business acquisitions during the year ended December 31, 2022 and 2021, respectively (in thousands): 2022 2021 Net expense 2,435 2,367 Cash settlement paid 21,113 13,785 Shares issued (number) 65 109 Divestitures and Sale of Assets In 2022, we sold one small book of business for $2.5 million in the Benefits and Insurance Services practice group and recorded a gain of $2.4 million. This gain is recorded as "Other (expense) income, net" in the accompanying Condensed Consolidated Statements of Comprehensive Income. Gain on book of business sales in 2021 was immaterial. Divested operations and assets that do not qualify for treatment as discontinued operations are recorded as “Gain (loss) on sale of operations, net” in the accompanying Consolidated Statements of Comprehensive Income. In 2021, we sold one business for $9.7 million in the Benefit and Insurance practice group and recorded a gain of $6.3 million. |
Segment Disclosures
Segment Disclosures | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Disclosures | SEGMENT DISCLOSURES Our business units have been aggregated into three practice groups: (i) Financial Services, (ii) Benefits and Insurance Services and (iii) National Practices, based on the following factors: similarity of the products and services provided to clients, similarity of the regulatory environment in which they operate; and similarity of economic conditions affecting long-term performance. The business units are managed along these segment lines. A general description of services provided by practice group is provided in the table below. Financial Services Benefits and Insurance Services National Practices Accounting and Tax Employee Benefits Consulting Information Technology Managed Networking and Hardware Services Financial Advisory Payroll / Human Capital Management Healthcare Consulting Valuation Property and Casualty Insurance Risk and Advisory Services Retirement and Investment Services Government Healthcare Consulting Corporate and Other - Included in Corporate and Other are operating expenses that are not directly allocated to the individual business units. These expenses primarily consist of certain healthcare costs, gains or losses attributable to assets held in our non-qualified deferred compensation plan, stock-based compensation, consolidation and integration charges, certain professional fees, certain advertising costs and other various expenses. Upon consolidation, intercompany accounts and transactions are eliminated, thus inter-segment revenue is not included in the measure of profit or loss for the practice groups. Performance of the practice groups is evaluated on income (loss) from continuing operations before income tax expense (benefit) excluding those costs listed above, which are reported in the “Corporate and Other”. We operate in the United States and Canada and revenue generated from such operations during the years ended December 31, 2022, 2021 and 2020 was as follows (in thousands): Year Ended December 31, 2022 2021 2020 United States $ 1,410,255 $ 1,103,183 $ 962,272 Canada 1,724 1,742 1,625 Total revenue $ 1,411,979 $ 1,104,925 $ 963,897 There is no one customer that represents a significant portion of our revenue. Segment information for the years ended December 31, 2022, 2021 and 2020 is presented below (in thousands). We do not manage our assets on a segment basis, therefore segment assets are not presented below. For the Year Ended December 31, 2022 Financial Benefits and National Corporate Total Revenue $ 1,010,068 $ 358,007 $ 43,904 $ — $ 1,411,979 Operating expenses 850,038 290,387 39,201 8,986 1,188,612 Gross margin 160,030 67,620 4,703 (8,986) 223,367 Corporate general and administrative expenses — — — 55,023 55,023 Operating income (loss) 160,030 67,620 4,703 (64,009) 168,344 Other income (expense): Interest expense — (6) — (8,033) (8,039) Gain on sale of operations, net 413 — — — 413 Other income (expense), net 269 2,392 10 (21,896) (19,225) Total other income (expense) 682 2,386 10 (29,929) (26,851) Income (loss) from continuing operations before income tax expense $ 160,712 $ 70,006 $ 4,713 $ (93,938) $ 141,493 For the Year Ended December 31, 2021 Financial Benefits and National Corporate Total Revenue $ 734,026 $ 332,323 $ 38,576 $ — $ 1,104,925 Operating expenses 608,238 271,650 34,494 31,253 945,635 Gross margin 125,788 60,673 4,082 (31,253) 159,290 Corporate general and administrative expenses — — — 56,150 56,150 Legal settlement, net — — — 30,468 30,468 Operating income (loss) 125,788 60,673 4,082 (117,871) 72,672 Other income (expense): Interest expense — — — (3,868) (3,868) (Loss) gain on sale of operations, net (289) 6,284 — — 5,995 Other income, net 263 827 3 17,148 18,241 Total other (expense) income (26) 7,111 3 13,280 20,368 Income (loss) from continuing operations before income tax expense $ 125,762 $ 67,784 $ 4,085 $ (104,591) $ 93,040 For the Year Ended December 31, 2020 Financial Benefits and National Corporate Total Revenue $ 629,778 $ 297,758 $ 36,361 $ — $ 963,897 Operating expenses 525,209 248,357 32,637 19,148 825,351 Gross margin 104,569 49,401 3,724 (19,148) 138,546 Corporate general and administrative expenses — — — 46,066 46,066 Operating income (loss) 104,569 49,401 3,724 (65,214) 92,480 Other income (expense): Interest expense — (34) — (4,949) (4,983) (Loss) gain on sale of operations, net (612) 103 — — (509) Other income, net 262 196 1 16,041 16,500 Total other (expense) income (350) 265 1 11,092 11,008 Income (loss) from continuing operations before income tax expense $ 104,219 $ 49,666 $ 3,725 $ (54,122) $ 103,488 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Share Repurchase Program Subsequent to December 31, 2022 and up to February 22, 2023, we repurchased approximately 0.1 million shares of our common stock on the open market at a total cost of approximately $4.5 million. On February 7, 2023, our Board of Directors authorized the continuation of the Share Repurchase Program, which has been renewed annually for the past nineteen years. It is effective beginning March 31, 2023, to which the amount of shares to be purchased will be reset to 5.0 million, and expires one year from the respective effective date. This authorization allows us to purchase shares of our common stock (i) in the open market, (ii) in privately negotiated transactions, or (iii) under Rule 10b5-1trading plans. Somerset Acquisition |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization - CBIZ, Inc. is a leading provider of financial, insurance and advisory services to businesses throughout the United States and parts of Canada. Acting through its subsidiaries, it has been serving small and medium-sized businesses, as well as individuals, governmental entities, and not-for-profit enterprises. CBIZ, Inc. manages and reports its operations along three practice groups: Financial Services, Benefits and Insurance Services and National Practices. A further description of products and services offered by each of the practice groups is provided in Note 19, Segment Disclosures, to the accompanying consolidated financial statements. |
Basis of Presentation | Basis of Presentation - The accompanying consolidated financial statements reflect the operations of CBIZ, Inc. and all of its wholly-owned subsidiaries (“CBIZ,” the “Company,” “we,” “us” or “our”), after elimination of all intercompany accounts and transactions. We have prepared the accompanying consolidated financial statements in accordance with GAAP and pursuant to the rules and regulations of the SEC. We have determined that our relationship with certain CPA firms with whom we maintain ASAs qualify as variable interest entities. The accompanying consolidated financial statements do not reflect the operations or accounts of variable interest entities as the impact is not material to our consolidated financial condition, results of operations or cash flows. |
Use of Estimates | Use of Estimates - The preparation of consolidated financial statements in conformity with GAAP and pursuant to the rules and regulations of the SEC requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Management’s estimates and assumptions are derived from and are continually evaluated based upon available information, judgment and experience. Actual results may differ materially from these estimates. |
Revenue Recognition | Revenue Recognition - We account for revenue in accordance with Topic 606, Revenue from Contracts with Customers. We recognize revenue based on the five-step model; (i) identify the contract with the customer; (ii) identify the performance obligation in the contract; (iii) determine the contract price; (iv) allocate the transaction price; and (v) recognize revenue as each performance obligation is satisfied. If we determine that a contract with enforceable rights and obligations does not exist, revenues are deferred until all criteria for an enforceable contract are met. |
Operating Expenses | Operating Expenses - Operating expenses represent costs of service and other costs incurred to operate our business units and are primarily comprised of personnel costs and occupancy related expenses. Personnel costs include (i) salaries and benefits; (ii) commissions paid to producers; (iii) incentive compensation; and (iv) share-based compensation. Incentive compensation costs and share-based compensation are estimated and accrued. The final determination of incentive compensation is made after year-end results are finalized. The largest components of occupancy costs are rent expense and utilities. Base rent expense is recognized over respective lease terms, while utilities and common area maintenance charges are recognized as incurred. |
Share-Based Compensation | Share-Based Compensation - The measurement of all share-based compensation arrangements is based on their respective grant date fair value. The grant date fair value of stock options is based on the Black-Scholes-Merton pricing model, which incorporates assumptions regarding the expected volatility, the expected option life, the risk-free interest rate and the expected dividend yield. The grant date fair value of restricted stock awards and restricted stock units is based on the closing price of the underlying stock on the date of issuance. The grant date fair value of the performance share units is based on the closing price of the underlying stock on the date of issuance and recorded based on achievement of target performance metrics. The expense related to stock options, restricted stock awards, and restricted stock units is recognized over the requisite service period which is generally three |
Operating Leases | Operating Leases - We determine if a contract is a lease at inception. We have leases for office space and facilities, automobiles, and certain information technology equipment. Certain of these leases include options to extend the lease and some include options to terminate the lease early. Effective January 1, 2019, we adopted the New Lease Standard using the modified retrospective method of applying the new standard at the adoption date. As an accounting policy election, we elected not to apply the recognition requirements under the New Lease Standards to short term leases (a lease at commencement date that has a lease term of 12 months or less and does not contain a purchase option that we are reasonably certain to exercise). The ROU assets and lease liabilities are recognized as of the commencement date based on the present value of the lease payments over the lease term. The discount rate utilized for the measurement purpose is based on our secured fixed rate to borrow over a comparable term for the lease because the rate implicit in the lease is not determinable. The lease term may include the options to extend or terminate the lease when it is reasonably certain that we will exercise the applicable option. Related rent expense under such leases is recognized evenly throughout the term of the lease when the total lease commitment is a known amount, and recorded on an as incurred basis when future rent payment increases under the obligation are unknown due to rent escalations being tied to factors that are not currently measurable (such as increases in the consumer price index). Differences between rent expense recognized and the cash payments required under these leases are recorded as a component of “Operating lease liability” in the Non-current liabilities section of the accompanying Consolidated Balance Sheets. We may receive incentives to lease office facilities in certain areas. Such incentives are recorded as a change in lease payments and may require us to remeasure the lease liability to reflect the change in lease payments. |
Cash and Cash Equivalents | Cash and Cash Equivalents - Cash and cash equivalents consist of cash on hand and investments with an original maturity of three months or less when purchased. |
Restricted Cash | Restricted Cash - Restricted cash consists of funds held by us in relation to our capital and investment advisory services as those funds are restricted in accordance with applicable Financial Industry Regulatory Authority regulations. Restricted cash also consists of funds on deposit from clients in connection with the pass-through of insurance premiums to the carrier with the related liability for these funds recorded in “Accounts payable” in the accompanying Consolidated Balance Sheets. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts - Accounts receivable, less allowances for doubtful accounts, reflects the net realizable value of receivables and approximates fair value. Unbilled revenues are recorded at estimated net realizable value. Assessing the collectability of receivables (billed and unbilled) requires management judgment based on a combination of factors. When evaluating the adequacy of the allowance for doubtful accounts and the overall probability of collecting on receivables, we analyze historical experience, client credit-worthiness, the age of the trade receivable balances, current economic conditions that may affect a client’s ability to pay and current and projected economic trends and conditions at the balance sheet date. |
Funds Held for Clients and Client Fund Obligations | Funds Held for Clients and Client Fund Obligations - Services provided by our payroll operations include the preparation of payroll checks, federal, state, and local payroll tax returns, and flexible spending account administration. In relation to these services, as well as other similar service offerings, we collect funds from our clients’ accounts in advance of paying client obligations. These funds, collected before they are due, are segregated and invested in accordance with our investment policy, which requires all investments carry an investment grade rating at the time of initial investment. These investments, primarily consisting of corporate and municipal bonds and U.S. treasury bills, are classified as available-for-sale and are included in the “Funds held for clients” line item on the accompanying Consolidated Balance Sheets. The underlying obligation is recorded as “Client fund obligations” on the Consolidated Balance Sheets. The balances in these accounts fluctuate with the timing of cash receipts and the related cash payments and may vary significantly during the year based on the timing of client’s payroll periods. Other than certain federal and state regulations pertaining to flexible spending account administration, there are no regulatory or other contractual restrictions placed on these funds. |
Property and Equipment | Property and Equipment - Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are provided on a straight-line basis over the following estimated useful lives: Buildings 25 to 40 years Furniture and fixtures 5 to 10 years Capitalized software 3 to 5 years Equipment 3 to 7 years |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets - Goodwill represents the excess of the purchase price of the acquired businesses and the related fair value of the net assets acquired. At December 31, 2022, the carrying value of goodwill totaled $819.9 million, compared to total assets of $1.9 billion and total shareholders’ equity of $713.5 million. Intangible assets consist of identifiable intangibles other than goodwill. Identifiable intangible assets other than goodwill include client lists and non-compete agreements which require significant judgments in determining the fair value. We carry client lists and non-compete agreements at cost, less accumulated amortization, in the accompanying Consolidated Balance Sheets. Goodwill is reviewed for impairment annually during the fourth quarter or more frequently in the event of an impairment indicator. We are required to consider whether it is more likely than not (defined as a likelihood of more than 50%) that the fair value of each reporting unit has fallen below its carrying value, thus requiring us to perform an interim goodwill impairment test. Intangible assets with definite lives, such as client lists and non-compete agreements, are amortized using the straight-line method over their estimated useful lives (generally ranging from three The goodwill impairment test is performed at a reporting unit level. A reporting unit is an operating segment of a business or one level below an operating segment. At December 31, 2022, we had five reporting units. We may use either a qualitative or quantitative approach when testing a reporting unit’s goodwill for impairment. Under the qualitative assessment, we are not required to calculate the fair value of a reporting unit unless we determine that it is more likely than not that its fair value is less than its carrying amount. If under the quantitative assessment the fair value of a reporting unit is less than its carrying amount, then the amount of the impairment loss, if any, must be measured. Any such impairment charge would reduce earnings and could be material. |
Income Taxes | Income Taxes - Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently payable and deferred taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and operating losses and tax credit carryforwards. State income tax credits are accounted for using the flow-through method. A valuation allowance is provided when it is more-likely-than-not that all or some portion of a deferred tax asset will not be realized. We determine valuation allowances based on all available evidence. Such evidence includes historical results, the reversal of deferred tax liabilities, expectations of future consolidated and/or separate company profitability and the feasibility of tax-planning strategies. Determining valuation allowances includes significant judgment by management, and different judgments could yield different results. Accounting for uncertain tax positions requires a more-likely-than-not threshold for recognition in the consolidated financial statements. We recognize a tax benefit based on whether it is more-likely-than-not that a tax position will be sustained. We record a liability to the extent that a tax position taken or expected to be taken on a tax return exceeds the amount recognized in the consolidated financial statements. |
Business Combinations | Business Combinations - We recognize and measure identifiable tangible and intangible assets acquired and liabilities assumed as of the acquisition date at fair value. Fair value measurements require extensive use of estimates and assumptions, including estimates of future cash flows to be generated by the acquired assets. The operating results of acquired businesses are included in our consolidated financial statements beginning on the date of acquisition. The purchase price is equivalent to the fair value of consideration transferred. Goodwill is recognized for the excess of purchase price over the net fair value of assets acquired and liabilities assumed. |
Contingent Purchase Price Liabilities | Contingent Purchase Price Liabilities - Contingent purchase price liabilities consisting of cash payments and common stock issuances result from our business acquisitions and are recorded at fair value at the time of acquisition as “Contingent purchase price liability - current” and “Contingent purchase price liability - non-current” in the accompanying Consolidated Balance Sheets. We estimate the fair value of our contingent purchase price liabilities using a probability-weighted discounted cash flow model. We probability weight risk-adjusted estimates of future performance of acquired businesses, then calculate the contingent purchase price based on the estimates and discount them to present value representing management’s best estimate of fair value. The fair value of the contingent purchase price liabilities, which is considered a Level 3 unobservable input, is reassessed on a quarterly basis based on assumptions provided by practice group leaders and business unit controllers together with our corporate finance department. Any change in the fair value estimate, including the revaluation of common stock, is recorded in the earnings of that period. |
Interest Rate Derivative Instruments | Interest Rate Derivative Instruments - We maintain interest rate swaps that are designated as cash flow hedges to manage the market risk from changes in interest rates on our floating-rate debt under our $600.0 million unsecured credit facility, by and among CBIZ Operations, Inc., CBIZ, Inc. and Bank of America, N.A., as administrative agent and bank, and other participating banks. The designation of a derivative instrument as a hedge and its ability to meet the hedge accounting criteria determine how we reflect the change in fair value of the derivative instrument. A derivative qualifies for hedge accounting treatment if, at inception, it meets defined correlation and effectiveness criteria. These criteria require that the anticipated cash flows and/or changes in fair value of the hedging instrument substantially offset those of the position being hedged. |
Recent Accounting Pronouncements and Accounting Standards Adopted in 2022 | Recent Accounting Pronouncements - The FASB ASC is the sole source of authoritative GAAP other than the SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an ASU to communicate changes to the FASB codification. We assess and review the impact of all ASUs. ASUs not listed below were reviewed and determined to be either not applicable or are not expected to have a material impact on the consolidated financial statements. Accounting Standards Adopted in 2022 Reference Rate Reform: In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU are effective for all entities through December 31, 2022. Subsequently, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope, which provides optional temporary guidance for entities transitioning away from the LIBOR and other interbank offered rates to new reference rates so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions within Topic 848. This ASU clarifies that the derivative instruments affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions provided in Topic 848. ASU 2021-01 is effective immediately for all entities. Entities may elect to apply the amendments on a full retrospective basis as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or on a prospective basis to new modifications from any date within an interim period that includes or is subsequent to the date of the issuance of a final update, up to the date that financial statements are available to be issued. The amendments provided in this ASU do not apply to contract modifications made, as well as new hedging relationships entered into, after December 31, 2022, and to existing hedging relationships evaluated for effectiveness for periods after December 31, 2022, except for certain hedging relationships existing as of December 31, 2022, that apply certain optional expedients in which the accounting effects are recorded through the end of the hedging relationship. |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Estimated Useful Lives Property and Equipment | Depreciation and amortization are provided on a straight-line basis over the following estimated useful lives: Buildings 25 to 40 years Furniture and fixtures 5 to 10 years Capitalized software 3 to 5 years Equipment 3 to 7 years |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue by Source | The following tables disaggregate our revenue by source (in thousands): For the Year Ended December 31, 2022 Financial Benefits and National Consolidated Accounting, tax, advisory and consulting $ 1,010,068 $ — $ — $ 1,010,068 Core Benefits and Insurance Services — 342,063 — 342,063 Non-core Benefits and Insurance Services — 15,944 — 15,944 Managed networking, hardware services — — 33,503 33,503 National Practices consulting — — 10,401 10,401 Total revenue $ 1,010,068 $ 358,007 $ 43,904 $ 1,411,979 For the Year Ended December 31, 2021 Financial Benefits and National Consolidated Accounting, tax, advisory and consulting $ 734,026 $ — $ — $ 734,026 Core Benefits and Insurance Services — 319,684 — 319,684 Non-core Benefits and Insurance Services — 12,639 — 12,639 Managed networking, hardware services — — 28,456 28,456 National Practices consulting — — 10,120 10,120 Total revenue $ 734,026 $ 332,323 $ 38,576 $ 1,104,925 For the Year Ended December 31, 2020 Financial Benefits and National Consolidated Accounting, tax, advisory and consulting $ 629,778 $ — $ — $ 629,778 Core Benefits and Insurance Services — 286,361 — 286,361 Non-core Benefits and Insurance Services — 11,397 — 11,397 Managed networking, hardware services — — 26,458 26,458 National Practices consulting — — 9,903 9,903 Total revenue $ 629,778 $ 297,758 $ 36,361 $ 963,897 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable, net balances at December 31, 2022 and 2021 were as follows (in thousands): 2022 2021 Trade accounts receivable $ 267,409 $ 190,710 Unbilled revenue, at net realizable value 87,890 67,616 Total accounts receivable 355,299 258,326 Allowance for doubtful accounts (20,801) (16,158) Accounts receivable, net $ 334,498 $ 242,168 |
Schedule of Changes in the Allowance for Doubtful Accounts on Accounts Receivable | Changes in the allowance for doubtful accounts on accounts receivable are as follows (in thousands): 2022 2021 2020 Balance at beginning of period $ (16,158) $ (14,894) $ (14,379) Provision (13,545) (9,422) (9,323) Charge-offs, net of recoveries 8,902 8,158 8,808 Balance at end of period $ (20,801) $ (16,158) $ (14,894) |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment, Net | Property and equipment, net at December 31, 2022 and 2021 consisted of the following (in thousands): 2022 2021 Buildings and leasehold improvements $ 47,300 $ 41,894 Furniture and fixtures 30,369 29,588 Capitalized software 34,735 34,474 Equipment 32,927 27,206 Total property and equipment 145,331 133,162 Accumulated depreciation (100,147) (89,739) Property and equipment, net $ 45,184 $ 43,423 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill by Operating Segment | A summary of changes in the carrying amount of goodwill by operating segment for the years ended December 31, 2022 and 2021 were as follows (in thousands): Financial Benefits and National Total Gross $ 412,086 $ 321,111 $ 33,873 $ 767,070 Accumulated impairment $ (44,047) $ (7,733) $ (32,207) $ (83,987) Net at December 31, 2020 $ 368,039 $ 313,378 $ 1,666 $ 683,083 Additions 58,646 1,800 — 60,446 Divestitures — (2,786) — (2,786) Gross 470,732 320,125 33,873 824,730 Accumulated impairment (44,047) (7,733) (32,207) (83,987) Net at December 31, 2021 $ 426,685 $ 312,392 $ 1,666 $ 740,743 Additions 79,147 — — 79,147 Other adjustment 27 — — 27 Gross 549,906 320,125 33,873 903,904 Accumulated impairment (44,047) (7,733) (32,207) (83,987) Net at December 31,2022 $ 505,859 $ 312,392 $ 1,666 $ 819,917 |
Components of Goodwill and Other Intangible Assets, Net | The components of goodwill and other intangible assets, net at December 31, 2022 and 2021 were as follows (in thousands): 2022 2021 Goodwill $ 819,917 $ 740,743 Intangibles : Client lists 302,822 249,422 Other intangibles 11,463 11,454 Total intangibles 314,285 260,876 Total goodwill and other intangibles assets 1,134,202 1,001,619 Accumulated amortization: Client lists (173,286) (152,326) Other intangibles (9,214) (8,510) Total accumulated amortization (182,500) (160,836) Goodwill and other intangible assets, net $ 951,702 $ 840,783 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
Summary of Bond Activity | The following table summarizes our bond activity for the years ended December 31, 2022 and 2021 (in thousands): 2022 2021 Fair value at January 1 $ 38,670 $ 25,708 Purchases 19,771 26,980 Redemptions (5,630) (6,530) Maturities (6,770) (8,347) Change in bond premium (645) 1,517 Fair market value adjustment (1,911) (658) Fair value at December 31 $ 43,485 $ 38,670 |
Summary of Outstanding Interest Rate Swaps | The following table summarizes our outstanding interest rate swaps and their classification in the accompanying Consolidated Balance Sheets at December 31, 2022 and 2021 (in thousands). Refer to Note 7, Fair Value Measurements, to the accompanying consolidated financial statements for additional disclosures regarding fair value measurements. December 31, 2022 Notional Fixed Rate Expiration Fair Balance Sheet Location Interest rate swap $ 15,000 2.571 % 6/1/2023 $ 133 Other current asset Interest rate swap $ 50,000 0.834 % 4/14/2025 $ 3,726 Other non-current asset Interest rate swap $ 30,000 1.186 % 12/14/2026 $ 2,871 Other non-current asset Interest rate swap $ 20,000 2.450 % 8/14/2027 $ 1,079 Other non-current asset December 31, 2021 Notional Fixed Rate Expiration Fair Balance Sheet Location Interest rate swap $ 20,000 1.770 % 5/14/2022 $ (120) Other current liability Interest rate swap $ 15,000 2.640 % 6/1/2023 $ (432) Other non-current liability Interest rate swap $ 50,000 0.885 % 4/14/2025 $ 405 Other non-current asset Interest rate swap $ 30,000 1.249 % 12/14/2026 $ (64) Other non-current liability |
Summary of Effects of Interest Rate Swap | The following table summarizes the effects of the interest rate swap on our accompanying Consolidated Statements of Comprehensive Income for the years ended December 31, 2022 and 2021 (in thousands): Gain recognized in Gain (loss) reclassified from Twelve Months Ended December 31, Twelve Months Ended December 31, Location 2022 2021 2022 2021 Interest rate swaps $ 6,255 $ 929 $ 357 $ (1,152) Interest expense |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table summarizes our assets and (liabilities) at December 31, 2022 and 2021 that are measured at fair value on a recurring basis subsequent to initial recognition and indicates the fair value hierarchy of the valuation techniques utilized by us to determine such fair value (in thousands): Level December 31, 2022 December 31, 2021 Deferred compensation plan assets 1 118,862 136,321 Available-for-sale debt securities 1 43,485 38,670 Other depository assets 1 868 1,144 Deferred compensation plan liabilities 1 (118,862) (136,321) Interest rate swaps, net 2 7,809 (211) Contingent purchase price liabilities 3 (132,010) (79,139) |
Change in Level 3 Fair Values of Contingent Purchase Price Liabilities | The following table summarizes the change in fair value of our contingent purchase price liabilities identified as Level 3 for the years ended December 31, 2022 and 2021 (pre-tax basis, in thousands): Contingent Beginning balance — January 1, 2021 $ (54,391) Additions from business acquisitions (39,666) Settlement of contingent purchase price payable 17,285 Change in fair value of contingency (554) Change in net present value of contingency (1,813) Balance — December 31, 2021 $ (79,139) Additions from business acquisitions (74,199) Settlement of contingent purchase price payable 23,763 Change in fair value of contingency 662 Change in net present value of contingency (3,097) Balance — December 31, 2022 $ (132,010) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income from Continuing Operations Before Income Taxes | For financial reporting purposes, income from continuing operations before income taxes includes the following components (in thousands): 2022 2021 2020 United States $ 141,306 $ 92,847 $ 103,306 Foreign (Canada) 187 193 182 Total $ 141,493 $ 93,040 $ 103,488 |
Income Tax Expense Included in Consolidated Statements of Comprehensive Income | Income tax expense included in the accompanying Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020 was as follows (in thousands): 2022 2021 2020 Continuing operations: Current: Federal $ 20,910 $ 12,369 $ 21,926 Foreign 50 52 78 State and local 7,299 3,397 5,584 Total 28,259 15,818 27,588 Deferred: Federal 5,667 5,029 (1,968) State and local 2,195 1,282 (479) Total 7,862 6,311 (2,447) Total income tax expense from continuing operations 36,121 22,129 25,141 Discontinued operations: Operations of discontinued operations: Current (7) (5) (11) Total income tax benefit from discontinued (7) (5) (11) Total income tax expense $ 36,114 $ 22,124 $ 25,130 |
Provision for Income Taxes Attributable to Income from Continuing Operations | The provision for income taxes attributable to income from continuing operations differed from the amount obtained by applying the federal statutory income tax rate to income from continuing operations before income taxes, as follows (in thousands, except percentages): 2022 2021 2020 Tax at U.S. federal statutory rates $ 29,714 $ 19,538 $ 21,733 State taxes (net of federal benefit) 9,019 4,498 5,354 Reserves for uncertain tax positions 337 (104) (1,290) Share-based compensation (6,832) (4,187) (2,394) Non-deductible officers' compensation 2,507 1,267 538 Other, net 1,376 1,117 1,200 Provision for income taxes from continuing operations $ 36,121 $ 22,129 $ 25,141 Effective income tax rate 25.5 % 23.8 % 24.3 % |
Tax Effects of Temporary Differences That Rises to Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2022 and 2021, were as follows (in thousands): 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 1,473 $ 1,202 Allowance for doubtful accounts 4,682 3,613 Employee benefits and compensation 37,075 33,549 Lease costs 6,871 5,726 Deferral of employer FICA taxes — 1,961 Other deferred tax assets 574 778 Total gross deferred tax assets 50,675 46,829 Less: valuation allowance (3,156) (2,046) Total deferred tax assets, net 47,519 44,783 Deferred tax liabilities: Goodwill and other intangibles 68,306 57,990 Property and equipment 1,185 1,488 Other deferred tax liabilities 2,791 745 Total gross deferred tax liabilities 72,282 60,223 Deferred income taxes, net $ (24,763) $ (15,440) |
Summary of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): 2022 2021 2020 Balance at January 1 $ 1,594 $ 1,536 $ 2,536 Additions for tax positions of the current year 175 161 150 Additions for positions of prior years 486 400 — Settlements of prior year positions — (374) — Lapse of statutes of limitation (144) (129) (1,150) Balance at December 31 $ 2,111 $ 1,594 $ 1,536 |
Debt and Financing Arrangemen_2
Debt and Financing Arrangements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Unsecured Credit Facility | The combined effective interest rates under the 2018 and 2022 credit facilities, including the impact of interest rate swaps associated with those credit facilities, were as follows: 2022 2021 Weighted average rates 2.67% 1.88% Range of effective rates 1.08% - 5.44% 1.06% - 3.64% |
Summary of Recognized Interest Expense | Interest expense, including amortization of deferred financing costs, commitment fees, line of credit fees, and other applicable bank charges, was as follows (in thousands): 2022 2021 2020 Credit facilities $ 8,033 $ 3,843 $ 4,919 Other line of credit 6 — 1 Other — 25 63 $ 8,039 $ 3,868 $ 4,983 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | The components of accumulated other comprehensive income (loss) at December 31, 2022 and 2021 were as follows (in thousands): 2022 2021 Net unrealized loss on available-for-sale securities, net of income tax benefit of $571 and $51, respectively $ (1,518) $ (127) Net unrealized income (loss) on interest rate swap, net of income tax expense (benefit) of $1,924 and $(41), respectively 5,885 (101) Foreign currency translation (763) (739) Accumulated other comprehensive income (loss) $ 3,604 $ (967) |
Employee Share Plans (Tables)
Employee Share Plans (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-Based Compensation Awards (Before Income Tax Expense) | During the years ended December 31, 2022, 2021 and 2020, we recognized compensation expense (before income tax expense) for these awards as follows (in thousands): 2022 2021 2020 Stock options $ 248 $ 1,291 $ 1,878 Restricted stock units and awards 5,204 5,603 4,960 Performance share units 9,237 4,513 2,031 Total share-based compensation expense $ 14,689 $ 11,407 $ 8,869 |
Stock Award Activity | Stock option activity during the year ended December 31, 2022 was as follows (number of options in thousands): Number of Weighted Weighted Aggregate Outstanding at December 31, 2021 1,223 $ 17.71 Exercised (670) $ 14.98 Outstanding at December 31, 2022 553 $ 21.03 1.83 years $ 14.3 Vested and exercisable at December 31, 2022 553 $ 21.03 1.83 years $ 14.3 |
Schedule of Fair Value Option Award Weighted Average Assumptions Used | The following weighted average assumptions were utilized: 2021 2020 Expected volatility (1) 27.49 % 27.27 % Expected option life (years) (2) 4.71 4.67 Risk-free interest rate (3) 0.74 % 0.19 % Expected dividend yield (4) — % — % (1) The expected volatility assumption was determined based upon the historical volatility of our stock price, using daily price intervals. (2) The expected option life was determined based upon our historical data using a midpoint scenario, which assumes all options are exercised halfway between the expiration date and the weighted average time it takes the option to vest. (3) The risk-free interest rate assumption was upon zero-coupon U.S. Treasury bonds with a term approximating the expected life of the respective options. |
Schedule of Restricted Stock Award Activity | Restricted stock units and awards activity during the year ended December 31, 2022 was as follows (in thousands, except per share data): Number of Weighted Average Grant-Date Fair Value (1) Non-vested at December 31, 2021 389 $ 25.07 Granted 130 $ 38.53 Vested (238) $ 23.47 Forfeited (4) $ 34.04 Non-vested at December 31, 2022 277 $ 32.62 (1) Represents weighted average market value of the shares as the awards are granted at no cost to the recipients. |
Schedule of PSU Award Activity | The following table presents our PSUs award activity during the twelve months ended December 31, 2022 (in thousands, except per share data): Performance Share Units Weighted Average Grant-Date Fair Value Per Unit (1) Outstanding at December 31, 2021 473 $ 23.64 Granted 103 $ 38.15 Vested (211) $ 19.82 Adjustments for performance results (2) 122 $ 25.75 Forfeited (5) $ 33.21 Outstanding at December 31, 2022 482 $ 28.84 ( 1) Represents weighted average market value of the shares; awards are granted at no cost to the recipients. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share from Continuing Operations | The following table sets forth the reconciliation of the numerator and the denominator of basic earnings per share and diluted earnings per share from continuing operations for the years ended December 31, 2022, 2021 and 2020 (in thousands, except per share data): Year Ended December 31, 2022 2021 2020 Numerator: Income from continuing operations $ 105,372 $ 70,911 $ 78,347 Denominator: Basic Weighted average common shares outstanding 51,502 52,637 54,288 Diluted Stock options (1) 487 683 802 Restricted stock awards 141 192 195 Contingent shares (2) 14 — 74 Performance share units (3) 244 211 — Diluted weighted average common shares outstanding 52,388 53,723 55,359 Earnings Per Share: Basic earnings per share from continuing operations $ 2.05 $ 1.35 $ 1.44 Diluted earnings per share from continuing operations $ 2.01 $ 1.32 $ 1.42 (1) For the years ended December 31, 2022, 2021 and 2020, a total of 68 thousand, 23 thousand and 253 thousand stock based awards, respectively, were excluded from the calculation of diluted earnings per share as their exercise prices would render them anti-dilutive. (2) Contingent shares represent additional shares to be issued for purchase price earned by former owners of businesses acquired by us once future conditions have been met. For further details, refer to Note 18, Business Combinations . (3) The denominator used in calculating diluted earnings per share did not include 0.2 million and 0.3 million performance share units for the twelve months ended December 31, 2022 and 2021, respectively. The performance conditions associated with these performance share units were not met and consequently none of these performance share units were considered as issuable for the years ended December 31, 2022 and 2021. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Balance Sheet Information Related to Leases | Supplemental balance sheet information related to the Company’s operating leases as of December 31, 2022 and 2021 was as follows (in thousands): December 31, 2022 December 31, 2021 Weighted-average remaining lease term 6.3 years 6.4 years Weighted-average discount rate 4.14 % 3.54 % |
Schedule of Lease Cost and Other Lease Information | The components of lease cost and other lease information as of and during the year ended December 31, 2022 and 2021 are as follows (in thousands): December 31, 2022 December 31, 2021 Operating lease cost $ 43,716 $ 35,584 Cash paid for amounts included in measurement of lease liabilities Operating cash flows for operating leases $ 45,378 $ 38,042 |
Schedule of Maturity of Operating Lease Liabilities | Maturities of operating lease liabilities at December 31, 2022 and minimum cash commitments under operating leases at December 31, 2021 were as follows (in thousands): December 31, 2022 2023 $ 44,595 2024 40,516 2025 38,978 2026 35,205 2027 31,230 Thereafter 51,756 Total undiscounted lease payments 242,280 Less: imputed interest (31,468) Total lease liabilities $ 210,812 December 31, 2021 2022 $ 36,202 2023 33,490 2024 29,153 2025 27,779 2026 23,213 Thereafter 50,311 Total undiscounted lease payments 200,148 Less: imputed interest (23,754) Total lease liabilities $ 176,394 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Aggregated Consideration And Preliminary Purchase Price Allocation | The following table summarizes the aggregated consideration and purchase price allocation for the acquisitions completed during the year ended December 31, 2022 and 2021, respectively (in thousands): 2022 2021 Common stock issued (number) 42 207 Common stock value $ 1,668 $ 6,940 Cash paid 79,141 66,651 Recorded contingent consideration 74,199 39,665 Total recorded purchase price $ 155,008 $ 113,256 Accounts receivable acquired, net $ 20,429 $ 9,838 Fixed assets acquired 1,933 1,473 Identifiable intangible assets acquired 53,400 42,422 Operating lease right-of-use asset acquired, net 49,291 19,153 Other assets acquired, net 1,693 848 Operating lease liability acquired - current (5,860) (3,020) Other current liabilities acquired (1,594) (1,771) Operating lease liability acquired - noncurrent (43,431) (16,133) Goodwill 79,147 60,446 Total net assets acquired $ 155,008 $ 113,256 Maximum potential contingent consideration $ 77,075 $ 41,720 |
Segment Allocation | The following table summarizes the aggregated goodwill and intangible asset amounts resulting from those acquisitions for the twelve months ended December 31, 2022 and 2021, respectively (in thousands): Twelve Months Ended December 31, 2022 2021 Financial Services Benefits & Insurance Financial Services Benefits & Insurance Goodwill $ 79,147 $ — $ 58,646 $ 1,800 Client list 53,400 — 40,950 1,290 Other intangibles — — 136 46 Total $ 132,547 $ — $ 99,732 $ 3,136 |
Contingent Consideration | The following table summarizes the changes in contingent purchase price consideration for previous acquisitions and contingent payments made for previous business acquisitions during the year ended December 31, 2022 and 2021, respectively (in thousands): 2022 2021 Net expense 2,435 2,367 Cash settlement paid 21,113 13,785 Shares issued (number) 65 109 |
Segment Disclosures (Tables)
Segment Disclosures (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers | We operate in the United States and Canada and revenue generated from such operations during the years ended December 31, 2022, 2021 and 2020 was as follows (in thousands): Year Ended December 31, 2022 2021 2020 United States $ 1,410,255 $ 1,103,183 $ 962,272 Canada 1,724 1,742 1,625 Total revenue $ 1,411,979 $ 1,104,925 $ 963,897 |
Summary of Segment Information | Segment information for the years ended December 31, 2022, 2021 and 2020 is presented below (in thousands). We do not manage our assets on a segment basis, therefore segment assets are not presented below. For the Year Ended December 31, 2022 Financial Benefits and National Corporate Total Revenue $ 1,010,068 $ 358,007 $ 43,904 $ — $ 1,411,979 Operating expenses 850,038 290,387 39,201 8,986 1,188,612 Gross margin 160,030 67,620 4,703 (8,986) 223,367 Corporate general and administrative expenses — — — 55,023 55,023 Operating income (loss) 160,030 67,620 4,703 (64,009) 168,344 Other income (expense): Interest expense — (6) — (8,033) (8,039) Gain on sale of operations, net 413 — — — 413 Other income (expense), net 269 2,392 10 (21,896) (19,225) Total other income (expense) 682 2,386 10 (29,929) (26,851) Income (loss) from continuing operations before income tax expense $ 160,712 $ 70,006 $ 4,713 $ (93,938) $ 141,493 For the Year Ended December 31, 2021 Financial Benefits and National Corporate Total Revenue $ 734,026 $ 332,323 $ 38,576 $ — $ 1,104,925 Operating expenses 608,238 271,650 34,494 31,253 945,635 Gross margin 125,788 60,673 4,082 (31,253) 159,290 Corporate general and administrative expenses — — — 56,150 56,150 Legal settlement, net — — — 30,468 30,468 Operating income (loss) 125,788 60,673 4,082 (117,871) 72,672 Other income (expense): Interest expense — — — (3,868) (3,868) (Loss) gain on sale of operations, net (289) 6,284 — — 5,995 Other income, net 263 827 3 17,148 18,241 Total other (expense) income (26) 7,111 3 13,280 20,368 Income (loss) from continuing operations before income tax expense $ 125,762 $ 67,784 $ 4,085 $ (104,591) $ 93,040 For the Year Ended December 31, 2020 Financial Benefits and National Corporate Total Revenue $ 629,778 $ 297,758 $ 36,361 $ — $ 963,897 Operating expenses 525,209 248,357 32,637 19,148 825,351 Gross margin 104,569 49,401 3,724 (19,148) 138,546 Corporate general and administrative expenses — — — 46,066 46,066 Operating income (loss) 104,569 49,401 3,724 (65,214) 92,480 Other income (expense): Interest expense — (34) — (4,949) (4,983) (Loss) gain on sale of operations, net (612) 103 — — (509) Other income, net 262 196 1 16,041 16,500 Total other (expense) income (350) 265 1 11,092 11,008 Income (loss) from continuing operations before income tax expense $ 104,219 $ 49,666 $ 3,725 $ (54,122) $ 103,488 |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies - Additional Information (Details) $ in Thousands | 12 Months Ended | ||||
Nov. 01, 2022 reporting_unit | Dec. 31, 2022 USD ($) reporting_unit practice_group | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2019 USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Number of practice groups | practice_group | 3 | ||||
Revenue | $ 1,411,979 | $ 1,104,925 | $ 963,897 | ||
Maximum maturity period of investments | 3 months | ||||
Allowance for doubtful accounts | $ 20,801 | 16,158 | 14,894 | $ 14,379 | |
Goodwill | 819,917 | 740,743 | 683,083 | ||
Assets | 1,879,124 | 1,627,934 | |||
Total stockholders' equity | $ 713,452 | 704,548 | 702,620 | $ 659,238 | |
Intangible assets amortization period | 7 years 7 months 6 days | ||||
Number of reporting units | reporting_unit | 5 | 5 | |||
Increase (decrease) in the fair value of contingent consideration, net | $ 2,435 | 2,367 | (629) | ||
Unsecured credit facility | 600,000 | ||||
Other income (expense), net | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Increase (decrease) in the fair value of contingent consideration, net | $ (2,400) | (2,400) | 600 | ||
Performance share units | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shares vesting term | 3 years | ||||
Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shares vesting term | 3 years | ||||
Intangible assets amortization period | 3 years | ||||
Minimum | Capitalized software | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property and equipment useful life | 3 years | ||||
Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shares vesting term | 4 years | ||||
Intangible assets amortization period | 15 years | ||||
Maximum | Capitalized software | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property and equipment useful life | 5 years | ||||
Financial service | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Revenue | $ 235,400 | $ 174,800 | $ 159,400 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies - Summary of Estimated Useful Lives Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Buildings | Minimum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 25 years |
Buildings | Maximum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 40 years |
Furniture and fixtures | Minimum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 5 years |
Furniture and fixtures | Maximum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 10 years |
Capitalized software | Minimum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 3 years |
Capitalized software | Maximum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 5 years |
Equipment | Minimum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 3 years |
Equipment | Maximum | |
Summary Of Significant Accounting Policies [Line Items] | |
Property and equipment useful life | 7 years |
Revenue - Summary of Disaggrega
Revenue - Summary of Disaggregation of Revenue by Source (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 1,411,979 | $ 1,104,925 | $ 963,897 |
Financial Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 1,010,068 | 734,026 | 629,778 |
Benefits and Insurance Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 358,007 | 332,323 | 297,758 |
National Practices | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 43,904 | 38,576 | 36,361 |
Accounting, tax, advisory and consulting | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 1,010,068 | 734,026 | 629,778 |
Accounting, tax, advisory and consulting | Financial Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 1,010,068 | 734,026 | 629,778 |
Core Benefits and Insurance Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 342,063 | 319,684 | 286,361 |
Core Benefits and Insurance Services | Benefits and Insurance Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 342,063 | 319,684 | 286,361 |
Non-core Benefits and Insurance Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 15,944 | 12,639 | 11,397 |
Non-core Benefits and Insurance Services | Benefits and Insurance Services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 15,944 | 12,639 | 11,397 |
Managed networking, hardware services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 33,503 | 28,456 | 26,458 |
Managed networking, hardware services | National Practices | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 33,503 | 28,456 | 26,458 |
National Practices consulting | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 10,401 | 10,120 | 9,903 |
National Practices consulting | National Practices | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 10,401 | $ 10,120 | $ 9,903 |
Accounts Receivable, Net - Sche
Accounts Receivable, Net - Schedule of Accounts Receivables Net (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Receivables [Abstract] | ||||
Trade accounts receivable | $ 267,409 | $ 190,710 | ||
Unbilled revenue, at net realizable value | 87,890 | 67,616 | ||
Total accounts receivable | 355,299 | 258,326 | ||
Allowance for doubtful accounts | (20,801) | (16,158) | $ (14,894) | $ (14,379) |
Accounts receivable, net | $ 334,498 | $ 242,168 |
Accounts Receivable, Net - Sc_2
Accounts Receivable, Net - Schedule of Changes in the Allowance for Doubtful Accounts on Accounts Receivable (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Balance at beginning of period | $ (16,158) | $ (14,894) | $ (14,379) |
Provision | (13,545) | (9,422) | (9,323) |
Charge-offs, net of recoveries | 8,902 | 8,158 | 8,808 |
Balance at end of period | $ (20,801) | $ (16,158) | $ (14,894) |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 145,331 | $ 133,162 |
Accumulated depreciation | (100,147) | (89,739) |
Property and equipment, net | 45,184 | 43,423 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 47,300 | 41,894 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 30,369 | 29,588 |
Capitalized software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 34,735 | 34,474 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 32,927 | $ 27,206 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense for property and equipment | $ 11.2 | $ 10.8 | $ 9.6 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, Net - Changes in Carrying Amount of Goodwill by Operating Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross | $ 903,904 | $ 824,730 | $ 767,070 |
Accumulated impairment | (83,987) | (83,987) | (83,987) |
Goodwill [Roll Forward] | |||
Beginning balance, Goodwill | 740,743 | 683,083 | |
Additions | 79,147 | 60,446 | |
Divestitures | (2,786) | ||
Other adjustment | 27 | ||
Ending balance, Goodwill | 819,917 | 740,743 | |
Financial Services | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 549,906 | 470,732 | 412,086 |
Accumulated impairment | (44,047) | (44,047) | (44,047) |
Goodwill [Roll Forward] | |||
Beginning balance, Goodwill | 426,685 | 368,039 | |
Additions | 79,147 | 58,646 | |
Divestitures | 0 | ||
Other adjustment | 27 | ||
Ending balance, Goodwill | 505,859 | 426,685 | |
Benefits and Insurance Services | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 320,125 | 320,125 | 321,111 |
Accumulated impairment | (7,733) | (7,733) | (7,733) |
Goodwill [Roll Forward] | |||
Beginning balance, Goodwill | 312,392 | 313,378 | |
Additions | 0 | 1,800 | |
Divestitures | (2,786) | ||
Other adjustment | 0 | ||
Ending balance, Goodwill | 312,392 | 312,392 | |
National Practices | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 33,873 | 33,873 | 33,873 |
Accumulated impairment | (32,207) | (32,207) | $ (32,207) |
Goodwill [Roll Forward] | |||
Beginning balance, Goodwill | 1,666 | 1,666 | |
Additions | 0 | 0 | |
Divestitures | 0 | ||
Other adjustment | 0 | ||
Ending balance, Goodwill | $ 1,666 | $ 1,666 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, Net - Additional Information (Details) | 12 Months Ended | |||
Nov. 01, 2022 USD ($) reporting_unit | Dec. 31, 2022 USD ($) reporting_unit | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||
Number of reporting units | reporting_unit | 5 | 5 | ||
Goodwill impairment | $ 0 | |||
Intangible assets amortization period | 7 years 7 months 6 days | |||
2023 | $ 20,700,000 | |||
2024 | 19,200,000 | |||
2025 | 17,800,000 | |||
2026 | 15,800,000 | |||
2027 | 14,700,000 | |||
Thereafter | $ 43,500,000 | |||
Minimum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization period | 3 years | |||
Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization period | 15 years | |||
Client Lists and Other Intangible Assets | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 21,700,000 | $ 16,300,000 | $ 13,600,000 | |
Client lists | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization period | 7 years 8 months 12 days | |||
Other intangibles | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization period | 5 years 3 months 18 days | |||
Other intangibles | Minimum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization period | 3 years | |||
Other intangibles | Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization period | 15 years |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets, Net - Components of Goodwill and Other Intangible Assets, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 819,917 | $ 740,743 | $ 683,083 |
Intangibles : | |||
Total intangibles | 314,285 | 260,876 | |
Total goodwill and other intangibles assets | 1,134,202 | 1,001,619 | |
Accumulated amortization: | |||
Total accumulated amortization | (182,500) | (160,836) | |
Goodwill and other intangible assets, net | 951,702 | 840,783 | |
Client lists | |||
Intangibles : | |||
Total intangibles | 302,822 | 249,422 | |
Accumulated amortization: | |||
Total accumulated amortization | (173,286) | (152,326) | |
Other intangibles | |||
Intangibles : | |||
Total intangibles | 11,463 | 11,454 | |
Accumulated amortization: | |||
Total accumulated amortization | $ (9,214) | $ (8,510) |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) | 3 Months Ended | |||
Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) swap | Jun. 30, 2022 USD ($) swap | Dec. 31, 2021 USD ($) | |
Debt Securities, Available-for-sale [Line Items] | ||||
Net par value of available-for-sale debt securities | $ 44,400,000 | $ 37,000,000 | ||
Funds held for clients | $ 171,313,000 | $ 157,909,000 | ||
Interest rate swaps | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Number of interest rate swaps held | swap | 4 | |||
Interest rate swap, August 2027 expiration | Other non-current asset | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Interest rate swap, term of contract | 5 years | |||
Notional amount | $ 20,000,000 | |||
Interest rate swap, fixed interest rate | 2.45% | 2.45% | ||
Interest rate swap, May 2022 expiration | Other current liability | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Notional amount | $ 20,000,000 | |||
Interest rate swap, fixed interest rate | 1.77% | 1.77% | ||
Number of interest rate swaps held | swap | 1 | |||
Certified deposits and other depository assets | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Funds held for clients | $ 900,000 | $ 1,100,000 |
Financial Instruments - Summary
Financial Instruments - Summary of Bond Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Securities, Available for Sale [Roll Forward] | ||
Fair value at beginning of period | $ 38,670 | $ 25,708 |
Purchases | 19,771 | 26,980 |
Redemptions | (5,630) | (6,530) |
Maturities | (6,770) | (8,347) |
Change in bond premium | (645) | 1,517 |
Fair market value adjustment | (1,911) | (658) |
Fair value at end of period | $ 43,485 | $ 38,670 |
Financial Instruments - Summa_2
Financial Instruments - Summary of Outstanding Interest Rate Swaps (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Interest rate swap, June 2023 expiration | Other current asset | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, asset | $ 15,000 | |||
Interest rate swap, fixed interest rate | 2.571% | |||
Fair value, asset | $ 133 | |||
Interest rate swap, June 2023 expiration | Other non-current liability | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, liability | $ 15,000 | |||
Interest rate swap, fixed interest rate | 2.64% | |||
Fair value, liability | $ (432) | |||
Interest rate swap, May 2022 expiration | Other current liability | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, liability | $ 20,000 | |||
Interest rate swap, fixed interest rate | 1.77% | 1.77% | ||
Fair value, liability | $ (120) | |||
Interest rate swap, April 2025 expiration | Other non-current asset | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, asset | $ 50,000 | $ 50,000 | ||
Interest rate swap, fixed interest rate | 0.834% | 0.885% | ||
Fair value, asset | $ 3,726 | $ 405 | ||
Interest rate swap, December 2026 expiration | Other non-current asset | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, asset | $ 30,000 | |||
Interest rate swap, fixed interest rate | 1.186% | |||
Fair value, asset | $ 2,871 | |||
Interest rate swap, December 2026 expiration | Other non-current liability | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, liability | $ 30,000 | |||
Interest rate swap, fixed interest rate | 1.249% | |||
Fair value, liability | $ (64) | |||
Interest rate swap, August 2027 expiration | Other non-current asset | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional amount, asset | $ 20,000 | |||
Interest rate swap, fixed interest rate | 2.45% | 2.45% | ||
Fair value, asset | $ 1,079 |
Financial Instruments - Summa_3
Financial Instruments - Summary of Effects of Interest Rate Swaps (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Derivatives, Fair Value [Line Items] | |||
Gain recognized in AOCL, net of tax | $ 5,986 | $ 1,799 | $ (1,525) |
Interest rate swaps | |||
Derivatives, Fair Value [Line Items] | |||
Gain recognized in AOCL, net of tax | 6,255 | 929 | |
Interest rate swaps | Interest expense | |||
Derivatives, Fair Value [Line Items] | |||
Gain (loss) reclassified from AOCL into expense | $ 357 | $ (1,152) |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Deferred compensation plan assets | $ 118,862 | $ 136,321 | |
Available-for-sale debt securities | 43,485 | 38,670 | $ 25,708 |
Deferred compensation plan liabilities | (118,862) | (136,321) | |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Deferred compensation plan assets | 118,862 | 136,321 | |
Available-for-sale debt securities | 43,485 | 38,670 | |
Other depository assets | 868 | 1,144 | |
Deferred compensation plan liabilities | (118,862) | (136,321) | |
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swaps, net | 7,809 | (211) | |
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent purchase price liabilities | $ (132,010) | $ (79,139) |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Fair value measurements, inter-transfers between levels | $ 0 | $ 0 | |
Increase (decrease) in the fair value of contingent consideration, net | 2,435,000 | 2,367,000 | $ (629,000) |
Other income (expense), net | |||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Increase (decrease) in the fair value of contingent consideration, net | $ (2,400,000) | $ (2,400,000) | $ 600,000 |
Fair Value Measurements - Chang
Fair Value Measurements - Change in Level 3 Fair Values of Contingent Purchase Price Liabilities (Details) - Contingent Purchase Price Liabilities - Level 3 - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ (79,139) | $ (54,391) |
Additions from business acquisitions | (74,199) | (39,666) |
Settlement of contingent purchase price payable | 23,763 | 17,285 |
Change in fair value of contingency | 662 | (554) |
Change in net present value of contingency | (3,097) | (1,813) |
Ending balance | $ (132,010) | $ (79,139) |
Income Taxes - Income from Cont
Income Taxes - Income from Continuing Operations Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 141,306 | $ 92,847 | $ 103,306 |
Foreign (Canada) | 187 | 193 | 182 |
Income from continuing operations before income tax expense | $ 141,493 | $ 93,040 | $ 103,488 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense Included in Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ 20,910 | $ 12,369 | $ 21,926 |
Foreign | 50 | 52 | 78 |
State and local | 7,299 | 3,397 | 5,584 |
Total | 28,259 | 15,818 | 27,588 |
Deferred: | |||
Federal | 5,667 | 5,029 | (1,968) |
State and local | 2,195 | 1,282 | (479) |
Total | 7,862 | 6,311 | (2,447) |
Total income tax expense from continuing operations | 36,121 | 22,129 | 25,141 |
Operations of discontinued operations: | |||
Current | (7) | (5) | (11) |
Total income tax benefit from discontinued operations | (7) | (5) | (11) |
Total income tax expense | $ 36,114 | $ 22,124 | $ 25,130 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes Attributable to Income from Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Tax at U.S. federal statutory rates | $ 29,714 | $ 19,538 | $ 21,733 |
State taxes (net of federal benefit) | 9,019 | 4,498 | 5,354 |
Reserves for uncertain tax positions | 337 | (104) | (1,290) |
Share-based compensation | (6,832) | (4,187) | (2,394) |
Non-deductible officers' compensation | 2,507 | 1,267 | 538 |
Other, net | 1,376 | 1,117 | 1,200 |
Total income tax expense from continuing operations | $ 36,121 | $ 22,129 | $ 25,141 |
Effective income tax rate | 25.50% | 23.80% | 24.30% |
Income Taxes - Tax Effects of T
Income Taxes - Tax Effects of Temporary Differences That Rises to Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 1,473 | $ 1,202 |
Allowance for doubtful accounts | 4,682 | 3,613 |
Employee benefits and compensation | 37,075 | 33,549 |
Lease costs | 6,871 | 5,726 |
Deferral of employer FICA taxes | 0 | 1,961 |
Other deferred tax assets | 574 | 778 |
Total gross deferred tax assets | 50,675 | 46,829 |
Less: valuation allowance | (3,156) | (2,046) |
Total deferred tax assets, net | 47,519 | 44,783 |
Deferred tax liabilities: | ||
Goodwill and other intangibles | 68,306 | 57,990 |
Property and equipment | 1,185 | 1,488 |
Other deferred tax liabilities | 2,791 | 745 |
Total gross deferred tax liabilities | 72,282 | 60,223 |
Deferred income taxes, net | $ (24,763) | $ (15,440) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Net increase in valuation allowance | $ 1.2 | |
State net operating loss carryforwards | 48 | |
State tax credit carryforwards | 0.2 | |
Unrecognized tax benefits that would impact effective tax rate | 1.4 | |
Reductions in the liability for unrecognized tax benefits due to expiration of statues of limitation | 0.1 | |
Accrued interest expense | $ 0 | |
Liability for interest expense | 0.3 | 0.2 |
Liability for penalties | $ 0.2 | $ 0.2 |
Income Taxes - Summary of Recon
Income Taxes - Summary of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning Balance | $ 1,594 | $ 1,536 | $ 2,536 |
Additions for tax positions of the current year | 175 | 161 | 150 |
Additions for positions of prior years | 486 | 400 | 0 |
Settlements of prior year positions | 0 | (374) | 0 |
Lapse of statutes of limitation | (144) | (129) | (1,150) |
Ending Balance | $ 2,111 | $ 1,594 | $ 1,536 |
Debt and Financing Arrangemen_3
Debt and Financing Arrangements - Additional Information (Details) - USD ($) | 3 Months Ended | ||||
Jun. 30, 2022 | Dec. 31, 2022 | May 04, 2022 | May 03, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||
Outstanding balance under applicable credit facility | $ 265,700,000 | $ 155,300,000 | |||
Other line of credit | |||||
Debt Instrument [Line Items] | |||||
Revolving loan commitment | 20,000,000 | ||||
Outstanding line of credit | 0 | 0 | |||
Credit facilities | |||||
Debt Instrument [Line Items] | |||||
Revolving loan commitment | $ 600,000,000 | $ 400,000,000 | |||
Revolving loan, accordion feature | 200,000,000 | ||||
Debt issuance costs | $ 2,100,000 | ||||
Outstanding balance under applicable credit facility | 265,700,000 | $ 155,300,000 | |||
Available funds under credit facility | $ 319,900,000 | ||||
Credit facilities | Swing Line Facility | |||||
Debt Instrument [Line Items] | |||||
Revolving loan commitment | $ 50,000,000 | $ 25,000,000 | |||
2018 credit facility | |||||
Debt Instrument [Line Items] | |||||
Write-off of deferred debt issuance cost | $ 41,000 |
Debt and Financing Arrangemen_4
Debt and Financing Arrangements - Summary of Unsecured Credit Facility (Details) - Credit facilities | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Weighted average rates | 2.67% | 1.88% |
Minimum | ||
Debt Instrument [Line Items] | ||
Range of effective rates | 1.08% | 1.06% |
Maximum | ||
Debt Instrument [Line Items] | ||
Range of effective rates | 5.44% | 3.64% |
Debt and Financing Arrangemen_5
Debt and Financing Arrangements - Summary of Recognized Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||
Total | $ 8,039 | $ 3,868 | $ 4,983 |
Credit facilities | |||
Debt Instrument [Line Items] | |||
Total | 8,033 | 3,843 | 4,919 |
Other line of credit | |||
Debt Instrument [Line Items] | |||
Total | 6 | 0 | 1 |
Other | |||
Debt Instrument [Line Items] | |||
Total | $ 0 | $ 25 | $ 63 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Components of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Equity [Abstract] | ||||
Unrealized (loss) gain on available for sale securities, income tax (benefit) expense | $ (571) | $ (51) | ||
Unrealized loss on interest rate swaps, income tax benefit | 1,924 | (41) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total stockholders' equity | 713,452 | 704,548 | $ 702,620 | $ 659,238 |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total stockholders' equity | 3,604 | (967) | $ (2,269) | $ (680) |
Net unrealized loss on available-for-sale securities, net of income tax benefit of $571 and $51, respectively | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total stockholders' equity | (1,518) | (127) | ||
Net unrealized income (loss) on interest rate swap, net of income tax expense (benefit) of $1,924 and $(41), respectively | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total stockholders' equity | 5,885 | (101) | ||
Foreign currency translation | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total stockholders' equity | $ (763) | $ (739) |
Commitments and Contingencies -
Commitments and Contingencies - Acquisitions (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Period of time shares are contractually restricted from sale (up to) | 1 year |
Commitments and Contingencies_2
Commitments and Contingencies - Letters of Credit and Guarantees (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Letters of credit outstanding | $ 5 | $ 3.4 |
License bonds outstanding amount | $ 2.3 | $ 2.3 |
Commitments and Contingencies_3
Commitments and Contingencies - Legal Proceedings (Details) - CBIZ Operations and former employee of CBIZ MMP $ in Millions | Dec. 19, 2016 USD ($) |
Commitments And Contingencies [Line Items] | |
Total transaction price | $ 200 |
Maximum | |
Commitments And Contingencies [Line Items] | |
Amount of damages sought (up to) | $ 177 |
Employee Benefits (Details)
Employee Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Maximum percentage of a participant's eligible compensation that a participating may elect to contribute, on a tax-deferred annually to the plan (as a percent) | 80% | ||
Percentage of matching contribution made by company, of first 6.0% of participating employees contributions (as a percent) | 50% | ||
Percentage of participating employees contribution, matched 100% (as a percent) | 6% | ||
Employer contribution | $ 16,100 | $ 13,200 | $ 12,200 |
Non-qualified deferred income (loss) on investment | (19,600) | 19,500 | $ 15,400 |
Non-qualified deferred compensation plan assets | 118,862 | 136,321 | |
Non-qualified deferred compensation plan liabilities | $ 118,862 | $ 136,321 |
Common Stock (Details)
Common Stock (Details) shares in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) | |
Schedule Of Common Stock [Line Items] | |||
Senior leverage ratio | 3 | ||
Cost of shares repurchased to settle statutory employee withholding related to vesting of stock awards | $ 122,773,000 | $ 96,382,000 | $ 57,564,000 |
Share Repurchase Program | |||
Schedule Of Common Stock [Line Items] | |||
Stock repurchase program authorized to be repurchased (in shares) | shares | 2.8 | 3 | |
Payment for acquisition of treasury stock | $ 122,800,000 | $ 96,400,000 | |
Shares repurchased to settle statutory employee withholding related to vesting of stock awards (in shares) | shares | 0.2 | 0.1 | |
Cost of shares repurchased to settle statutory employee withholding related to vesting of stock awards | $ 7,300,000 | $ 3,000,000 | |
Maximum | |||
Schedule Of Common Stock [Line Items] | |||
Annual share repurchase limit | $ 35,000,000 |
Employee Stock Plans - Addition
Employee Stock Plans - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | May 09, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Price an employee pays for shares as percentage of fair market value | 85% | |||
Holding period of stock | 1 year | |||
Stock options granted (in shares) | 0 | 50,000 | 50,000 | |
Fair value of stock options granted (in dollars per share) | $ 8.10 | $ 5.79 | ||
Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of incremental vesting schedule | 25% | |||
Incremental vesting schedule period | 4 years | |||
Options awarded under the plans vesting period | 4 years | |||
Stock options expiry date | 6 years | |||
Weighted-average grant-date fair value of stock options granted | $ 400,000 | $ 300,000 | ||
Aggregate intrinsic value of stock options exercised | $ 19,100,000 | 13,600,000 | 8,900,000 | |
Restricted stock units and awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost for restricted stock awards | $ 5,200,000 | |||
Compensation cost for non-vested stock options weighted average period | 8 months 23 days | |||
Total fair value of shares vested during period | $ 5,600,000 | 4,900,000 | 4,600,000 | |
Market value of shares awarded during period | $ 5,000,000 | $ 5,000,000 | $ 4,300,000 | |
Performance share units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options awarded under the plans vesting period | 3 years | |||
Share-based compensation arrangement by share-based payment award, remaining contractual terms | 3 years | |||
Achievement of an earnings per share target | 70% | |||
Achievement of total growth in revenue | 30% | |||
2019 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share available for future grant (in shares) | 3,100,000 | |||
2014 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share available for future grant (in shares) | 1,800,000 | |||
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options awarded under the plans vesting period | 3 years | |||
Minimum | Restricted stock units and awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options awarded under the plans vesting period | 1 year | |||
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
ESPP allows qualified employees to purchase shares of common stock | $ 25,000 | |||
Shares purchased under ESPP | 2,000,000 | |||
Options awarded under the plans vesting period | 4 years | |||
Maximum | Restricted stock units and awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options awarded under the plans vesting period | 4 years | |||
Maximum | Performance share units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of initial grant | 200% |
Employee Stock Plans - Schedule
Employee Stock Plans - Schedule of Share-Based Compensation Awards (Before Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
Stock options | $ 248 | $ 1,291 | $ 1,878 |
Restricted stock units and awards | 5,204 | 5,603 | 4,960 |
Performance share units | 9,237 | 4,513 | 2,031 |
Total share-based compensation expense | $ 14,689 | $ 11,407 | $ 8,869 |
Employee Stock Plans - Schedu_2
Employee Stock Plans - Schedule of Stock Award Activity (Details) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Stock Option Activity | |
Outstanding beginning balance (in shares) | shares | 1,223 |
Exercised (in shares) | shares | (670) |
Outstanding ending balance (in shares) | shares | 553 |
Stock Option Weighted Average Exercise Price Per Share | |
Outstanding begging balance (in dollars per share) | $ / shares | $ 17.71 |
Exercised (in dollars per share) | $ / shares | 14.98 |
Outstanding ending balance (in dollars per share) | $ / shares | $ 21.03 |
Stock Option Activity, Additional Disclosures | |
Options outstanding, Weighted average remaining contractual term | 1 year 9 months 29 days |
Options outstanding, Aggregate intrinsic value (in dollars) | $ | $ 14.3 |
Options vested and exercisable, Number of Options (in shares) | shares | 553 |
Options vested and exercisable, Weighted average exercise price per share (in dollars per share) | $ / shares | $ 21.03 |
Options vested and exercisable, Weighted average remaining contractual term | 1 year 9 months 29 days |
Options exercisable, Aggregate intrinsic value (in dollars) | $ | $ 14.3 |
Employee Stock Plans - Schedu_3
Employee Stock Plans - Schedule of Fair Value Option Award Weighted Average Assumptions Used (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | ||
Expected volatility | 27.49% | 27.27% |
Expected option life ( in years) | 4 years 8 months 15 days | 4 years 8 months 1 day |
Risk-free interest rate | 0.74% | 0.19% |
Expected dividend yield | 0% | 0% |
Employee Share Plans - Schedule
Employee Share Plans - Schedule of Restricted Stock Award Activity (Details) - Restricted stock units and awards shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Number of Shares | |
Non-vested beginning balance (in shares) | shares | 389 |
Granted (in shares) | shares | 130 |
Vested (in shares) | shares | (238) |
Forfeited (in shares) | shares | (4) |
Non-vested ending balance (in shares) | shares | 277 |
Weighted Average Grant Date Fair Value | |
Non-vested beginning balance (in dollars per share) | $ / shares | $ 25.07 |
Granted (in dollars per share) | $ / shares | 38.53 |
Vested (in dollars per share) | $ / shares | 23.47 |
Forfeited (in dollars per share) | $ / shares | 34.04 |
Non-vested ending balance (in dollars per share) | $ / shares | $ 32.62 |
Employee Stock Plans - Schedu_4
Employee Stock Plans - Schedule of Performance Share Units Award Activity (Details) - Performance share units shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Performance Share Units | |
Non-vested beginning balance (in shares) | shares | 473 |
Granted (in shares) | shares | 103 |
Vested (in shares) | shares | (211) |
Adjustments for performance results (in shares) | shares | 122 |
Forfeited (in shares) | shares | (5) |
Non-vested ending balance (in shares) | shares | 482 |
Weighted Average Grant Date Fair Value Per Unit | |
Non-vested beginning balance (in dollars per share) | $ / shares | $ 23.64 |
Granted (in dollars per share) | $ / shares | 38.15 |
Vested (in dollars per share) | $ / shares | 19.82 |
Adjustments for performance results (in dollars per share) | $ / shares | 25.75 |
Forfeited (in dollars per share) | $ / shares | 33.21 |
Non-vested ending balance (in dollars per share) | $ / shares | $ 28.84 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | |||
Income (loss) from continuing operations | $ 105,372 | $ 70,911 | $ 78,347 |
Basic | |||
Weighted average common shares outstanding | 51,502 | 52,637 | 54,288 |
Diluted | |||
Stock options (in shares) | 487 | 683 | 802 |
Restricted stock awards (in shares) | 141 | 192 | 195 |
Contingent shares (in shares) | 14 | 0 | 74 |
Performance share units (in shares) | 244 | 211 | 0 |
Diluted weighted average common shares outstanding (in shares) | 52,388 | 53,723 | 55,359 |
Basic earnings per share from continuing operations (in dollars per share) | $ 2.05 | $ 1.35 | $ 1.44 |
Diluted earnings per share from continuing operations (in dollars per share) | $ 2.01 | $ 1.32 | $ 1.42 |
Share-based Payment Arrangement | |||
Dilutive Securities Included And Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Share based awards excluded from the calculation of diluted earnings per share (in shares) | 68 | 23 | 253 |
Performance share units | |||
Dilutive Securities Included And Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Share based awards excluded from the calculation of diluted earnings per share (in shares) | 200 | 300 |
Leases - Schedule of Balance Sh
Leases - Schedule of Balance Sheet Information Related to Leases (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Weighted-average remaining lease term | 6 years 3 months 18 days | 6 years 4 months 24 days |
Weighted-average discount rate | 4.14% | 3.54% |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost and Other Lease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating lease cost | $ 43,716 | $ 35,584 |
Cash paid for amounts included in measurement of lease liabilities | ||
Operating cash flows for operating leases | $ 45,378 | $ 38,042 |
Leases - Additional Information
Leases - Additional Information (Details) | Dec. 31, 2022 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating lease, remaining lease term | 1 year |
Operating lease, renewal term | 2 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating lease, remaining lease term | 10 years |
Operating lease, renewal term | 5 years |
Leases - Schedule of Maturity o
Leases - Schedule of Maturity of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Year one | $ 44,595 | $ 36,202 |
Year two | 40,516 | 33,490 |
Year three | 38,978 | 29,153 |
Year four | 35,205 | 27,779 |
Year five | 31,230 | 23,213 |
Thereafter | 51,756 | 50,311 |
Total undiscounted lease payments | 242,280 | 200,148 |
Less: imputed interest | (31,468) | (23,754) |
Total lease liabilities | $ 210,812 | $ 176,394 |
Related Parties (Details)
Related Parties (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||
Operating lease payments to related parties | $ 1.9 | $ 2.3 | $ 2.2 |
Global Prairie | |||
Related Party Transaction [Line Items] | |||
Related Party Costs | $ 0.2 |
Business Combinations - Additio
Business Combinations - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) business | Dec. 31, 2021 USD ($) business | Dec. 31, 2020 USD ($) | |
Business Acquisition, Contingent Consideration [Line Items] | |||
Annual aggregate revenue | $ 148,100 | ||
Transaction and integration related costs | 10,500 | ||
Proceeds from sales of assets and divested operations | $ 3,022 | $ 9,710 | $ 711 |
Benefits and Insurance Services | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Number of businesses sold | business | 1 | 1 | |
Proceeds from sales of assets and divested operations | $ 2,500 | $ 9,700 | |
Gain (loss) on disposition of business | $ 2,400 | $ 6,300 | |
Client lists | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Acquired finite-lived intangible assets, useful life | 10 years | ||
Other intangibles | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Acquired finite-lived intangible assets, useful life | 3 years |
Business Combinations - Aggrega
Business Combinations - Aggregated Consideration And Preliminary Purchase Price Allocation (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||
Goodwill | $ 819,917 | $ 740,743 | $ 683,083 |
Series of Individually Immaterial Business Acquisitions | |||
Business Acquisition [Line Items] | |||
Common stock issued (in shares) | 42 | 207 | |
Common stock value | $ 1,668 | $ 6,940 | |
Cash paid | 79,141 | 66,651 | |
Recorded contingent consideration | 74,199 | 39,665 | |
Total recorded purchase price | 155,008 | 113,256 | |
Accounts receivable acquired, net | 20,429 | 9,838 | |
Fixed assets acquired | 1,933 | 1,473 | |
Identifiable intangible assets acquired | 53,400 | 42,422 | |
Operating lease right-of-use asset acquired, net | 49,291 | 19,153 | |
Other assets acquired, net | 1,693 | 848 | |
Operating lease liability acquired - current | (5,860) | (3,020) | |
Other current liabilities acquired | (1,594) | (1,771) | |
Operating lease liability acquired - noncurrent | (43,431) | (16,133) | |
Goodwill | 79,147 | 60,446 | |
Total net assets acquired | 155,008 | 113,256 | |
Maximum potential contingent consideration | $ 77,075 | $ 41,720 |
Business Combinations - Segment
Business Combinations - Segment Allocation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Business Combination Segment Allocation [Line Items] | ||
Additions | $ 79,147 | $ 60,446 |
Financial Services | ||
Business Combination Segment Allocation [Line Items] | ||
Additions | 79,147 | 58,646 |
Total | 132,547 | 99,732 |
Financial Services | Client lists | ||
Business Combination Segment Allocation [Line Items] | ||
Intangibles | 53,400 | 40,950 |
Financial Services | Other intangibles | ||
Business Combination Segment Allocation [Line Items] | ||
Intangibles | 0 | 136 |
Benefits and Insurance Services | ||
Business Combination Segment Allocation [Line Items] | ||
Additions | 0 | 1,800 |
Total | 0 | 3,136 |
Benefits and Insurance Services | Client lists | ||
Business Combination Segment Allocation [Line Items] | ||
Intangibles | 0 | 1,290 |
Benefits and Insurance Services | Other intangibles | ||
Business Combination Segment Allocation [Line Items] | ||
Intangibles | $ 0 | $ 46 |
Business Combinations - Changes
Business Combinations - Changes in Contingent Purchase Price Consideration (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | ||
Net expense | $ 2,435 | $ 2,367 |
Cash settlement paid | $ 21,113 | $ 13,785 |
Shares issued (number) (in shares) | 65 | 109 |
Segment Disclosures - Additiona
Segment Disclosures - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
Segment Reporting [Abstract] | |
Number of business units of the company | 3 |
Segment Disclosures - Schedule
Segment Disclosures - Schedule of Revenue from External Customers (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 1,411,979 | $ 1,104,925 | $ 963,897 |
United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | 1,410,255 | 1,103,183 | 962,272 |
Canada | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | $ 1,724 | $ 1,742 | $ 1,625 |
Segment Disclosures - Summary o
Segment Disclosures - Summary of Segment Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | |||
Revenue | $ 1,411,979 | $ 1,104,925 | $ 963,897 |
Operating expenses | 1,188,612 | 945,635 | 825,351 |
Gross margin | 223,367 | 159,290 | 138,546 |
Corporate general and administrative expenses | 55,023 | 56,150 | 46,066 |
Legal settlement, net | 0 | 30,468 | 0 |
Operating income (loss) | 168,344 | 72,672 | 92,480 |
Other (expense) income: | |||
Interest expense | (8,039) | (3,868) | (4,983) |
(Loss) gain on sale of operations, net | 413 | 5,995 | (509) |
Other income (expense), net | (19,225) | 18,241 | 16,500 |
Total other (expense) income, net | (26,851) | 20,368 | 11,008 |
Income from continuing operations before income tax expense | 141,493 | 93,040 | 103,488 |
Financial Services | |||
Segment Reporting Information [Line Items] | |||
Revenue | 1,010,068 | 734,026 | 629,778 |
Benefits and Insurance Services | |||
Segment Reporting Information [Line Items] | |||
Revenue | 358,007 | 332,323 | 297,758 |
National Practices | |||
Segment Reporting Information [Line Items] | |||
Revenue | 43,904 | 38,576 | 36,361 |
Operating Segments | Financial Services | |||
Segment Reporting Information [Line Items] | |||
Revenue | 1,010,068 | 734,026 | 629,778 |
Operating expenses | 850,038 | 608,238 | 525,209 |
Gross margin | 160,030 | 125,788 | 104,569 |
Corporate general and administrative expenses | 0 | 0 | 0 |
Legal settlement, net | 0 | ||
Operating income (loss) | 160,030 | 125,788 | 104,569 |
Other (expense) income: | |||
Interest expense | 0 | 0 | 0 |
(Loss) gain on sale of operations, net | 413 | (289) | (612) |
Other income (expense), net | 269 | 263 | 262 |
Total other (expense) income, net | 682 | (26) | (350) |
Income from continuing operations before income tax expense | 160,712 | 125,762 | 104,219 |
Operating Segments | Benefits and Insurance Services | |||
Segment Reporting Information [Line Items] | |||
Revenue | 358,007 | 332,323 | 297,758 |
Operating expenses | 290,387 | 271,650 | 248,357 |
Gross margin | 67,620 | 60,673 | 49,401 |
Corporate general and administrative expenses | 0 | 0 | 0 |
Legal settlement, net | 0 | ||
Operating income (loss) | 67,620 | 60,673 | 49,401 |
Other (expense) income: | |||
Interest expense | (6) | 0 | (34) |
(Loss) gain on sale of operations, net | 0 | 6,284 | 103 |
Other income (expense), net | 2,392 | 827 | 196 |
Total other (expense) income, net | 2,386 | 7,111 | 265 |
Income from continuing operations before income tax expense | 70,006 | 67,784 | 49,666 |
Operating Segments | National Practices | |||
Segment Reporting Information [Line Items] | |||
Revenue | 43,904 | 38,576 | 36,361 |
Operating expenses | 39,201 | 34,494 | 32,637 |
Gross margin | 4,703 | 4,082 | 3,724 |
Corporate general and administrative expenses | 0 | 0 | 0 |
Legal settlement, net | 0 | ||
Operating income (loss) | 4,703 | 4,082 | 3,724 |
Other (expense) income: | |||
Interest expense | 0 | 0 | 0 |
(Loss) gain on sale of operations, net | 0 | 0 | 0 |
Other income (expense), net | 10 | 3 | 1 |
Total other (expense) income, net | 10 | 3 | 1 |
Income from continuing operations before income tax expense | 4,713 | 4,085 | 3,725 |
Corporate and Other | |||
Segment Reporting Information [Line Items] | |||
Revenue | 0 | 0 | 0 |
Operating expenses | 8,986 | 31,253 | 19,148 |
Gross margin | (8,986) | (31,253) | (19,148) |
Corporate general and administrative expenses | 55,023 | 56,150 | 46,066 |
Legal settlement, net | 30,468 | ||
Operating income (loss) | (64,009) | (117,871) | (65,214) |
Other (expense) income: | |||
Interest expense | (8,033) | (3,868) | (4,949) |
(Loss) gain on sale of operations, net | 0 | 0 | 0 |
Other income (expense), net | (21,896) | 17,148 | 16,041 |
Total other (expense) income, net | (29,929) | 13,280 | 11,092 |
Income from continuing operations before income tax expense | $ (93,938) | $ (104,591) | $ (54,122) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 2 Months Ended | 12 Months Ended | |||||
Mar. 31, 2023 | Feb. 07, 2023 | Feb. 01, 2023 | Feb. 22, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Subsequent Event [Line Items] | |||||||
Share repurchases, value | $ 122,773 | $ 96,382 | $ 57,564 | ||||
Business acquisition, annualized revenue | $ 148,100 | ||||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Share repurchases (in shares) | 100,000 | ||||||
Share repurchases, value | $ 4,500 | ||||||
Stock repurchase program duration | 19 years | ||||||
Subsequent Event | Somerset Acquisition | |||||||
Subsequent Event [Line Items] | |||||||
Business acquisition, annualized revenue | $ 55,000 | ||||||
Subsequent Event | Forecast | |||||||
Subsequent Event [Line Items] | |||||||
Stock repurchase program authorized to be repurchased (in shares) | 5,000,000 | ||||||
Renewal period of share repurchase | 1 year |