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Disposition of Business (Notes)
 3 Months Ended
Dec. 31, 2018
Discontinued Operations and Disposal Groups [Abstract]  
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
Disposition of Business
In connection with our ongoing strategic business and portfolio review, on November 7, 2018, our Board of Directors approved the divestiture of our Imaging business. On November 11, 2018, we entered into a sale agreement (the “Agreement”) with Project Leopard AcquireCo Limited, a private limited company incorporated under the laws of England and Wales (and an affiliate of Kofax, Inc.) (the “Buyer”), relating to the sale of our Imaging business for a total cash consideration of approximately $400 million, subject to certain working capital adjustments as set forth in the Agreement. Pursuant to the Agreement, we will sell and transfer, and Buyer will purchase and acquire, (a) the shares of certain subsidiaries through which we operate a portion of our Imaging business and (b) certain assets used in or related to the business; and the Buyer will assume certain liabilities related to such assets or the business, subject to certain exclusions and indemnities as set forth in the Agreement. On February 1, 2019, we completed the sale of the business and received approximately $390 million, after estimated transaction expenses, and subject to post-closing finalization of those adjustments as set forth in the Agreement. For all periods presented, Imaging 's results of operations have been included within discontinued operations and its assets and liabilities within held for sale on our condensed consolidated financial statements.

The following table summarizes the results of the discontinued operations (dollars in thousands):
 
Three Months Ended December 31,
 
2018
 
2017
 
(ASC 606)
 
(ASC 605)
Major line items constituting net income of Imaging:
 
 
 
Revenue (a)
$
51,995

 
$
54,421

Cost of revenue
12,004

 
12,956

Research and development
5,516

 
7,280

Sales and marketing (a)
18,190

 
21,400

General and administrative
1,231

 
1,119

Amortization of intangible assets
3,914

 
4,223

Acquisition-related costs, net
(386
)
 
—

Restructuring and other charges, net
8,460

 
1,232

Income from discontinued operations before income taxes (a)
3,066

 
6,211

Provision for income taxes
1,675

 
448

Net income from discontinued operations
$
1,391

 
$
5,763

 
 
 
 
Supplemental information:
 
 
 
Depreciation
$
294

 
$
417

Amortization
$
4,926

 
$
6,065

Stock compensation
$
2,102

 
$
1,761


Capital expenditures for the three-month periods ended December 31, 2018 and December 31, 2017 were de minimis.
(a) As more fully described in Note 2, as a result of the adoption of ASC 606 using the modified retrospective approach, revenue for the three months ended December 31, 2018 reflects an increase of $1.6 million due to the upfront recognition of term licenses and the re-allocation of contract consideration to performance obligations based upon standalone selling prices; sales and marketing expense for the three months ended December 31, 2018 reflects a decrease of $1.5 million due to the capitalization and amortization of commission expense; and the provision for income taxes for the three months ended December 31, 2018 reflects an increase in provision of $1.1 million related to the tax effect of the ASC 606 adjustments.





The following table summarizes the assets and liabilities included within discontinued operations (dollars in thousands):
 
December 31,
2018
 
September 30,
2018
 
(ASC 606)
 
(ASC 605)
Major classes of Imaging assets:
 
 
 
Accounts receivable, net
$
30,492

 
$
30,959

Prepaid expenses and other current assets(a)
4,979

 
3,443

Land, building and equipment, net
2,321

 
2,442

Goodwill
257,129

 
257,352

Intangible assets, net
94,356

 
99,507

Other (a)
5,989

 
196

   Total assets classified as held for sale
$
395,266

 
$
393,899

 
 
 
 
Major classes of Imaging liabilities:
 
 
 
Accounts payable
$
6,611

 
$
3,604

Accrued expenses and other current liabilities
13,795

 
12,305

Deferred revenue (a)
93,547

 
107,965

Other
3,025

 
2,657

   Total liabilities classified as held for sale
$
116,978

 
$
126,531

(a) As more fully described in Note 2, as a result of the adoption of ASC 606 using the modified retrospective approach, contract assets as of December 31, 2018 reflects an increase of $7.6 million due to capitalized commissions included within prepaid expense and other current assets, and other assets; and deferred revenue as of December 31, 2018 reflects a decrease of $11.7 million due to the upfront recognition of term licensing revenue.
Additionally, on November 19, 2018, we announced our intent to spin off our Automotive business into an independent publicly traded company through a pro rata distribution to our common stock holders. Completion of the proposed spin-off is subject to certain conditions, including final approval by our Board of Directors. We intend to complete the separation of the business by the end of fiscal year 2019.
Disposition of Business
In connection with our ongoing strategic business and portfolio review, on November 7, 2018, our Board of Directors approved the divestiture of our Imaging business. On November 11, 2018, we entered into a sale agreement (the “Agreement”) with Project Leopard AcquireCo Limited, a private limited company incorporated under the laws of England and Wales (and an affiliate of Kofax, Inc.) (the “Buyer”), relating to the sale of our Imaging business for a total cash consideration of approximately $400 million, subject to certain working capital adjustments as set forth in the Agreement. Pursuant to the Agreement, we will sell and transfer, and Buyer will purchase and acquire, (a) the shares of certain subsidiaries through which we operate a portion of our Imaging business and (b) certain assets used in or related to the business; and the Buyer will assume certain liabilities related to such assets or the business, subject to certain exclusions and indemnities as set forth in the Agreement. On February 1, 2019, we completed the sale of the business and received approximately $390 million, after estimated transaction expenses, and subject to post-closing finalization of those adjustments as set forth in the Agreement. For all periods presented, Imaging 's results of operations have been included within discontinued operations and its assets and liabilities within held for sale on our condensed consolidated financial statements.

The following table summarizes the results of the discontinued operations (dollars in thousands):