10-Q/A

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q/A

(Amendment No. 1)

xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2011

OR

oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to              

Commission File Number 001-11919

TeleTech Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware	84-1291044
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

9197 South Peoria Street

Englewood, Colorado 80112

(Address of principal executive offices)

Registrant’s telephone number, including area code: (303) 397-8100

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x  No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x  No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer x
Non-accelerated filer o(Do not check if a smaller reporting company)	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o  No x

As of October 27, 2011, there were 56,173,894 shares of the registrant’s common stock outstanding.

Explanatory Note

TeleTech Holdings, Inc. (the “Company”) is filing this Amendment No. 1 to our Quarterly Report on Form 10-Q for the period ended September 30, 2011, which was filed with the Securities and Exchange Commission on November 2, 2011 (the “Form 10-Q”), solely to file a corrected Exhibit 101 to the Form 10-Q.  The original Interactive Data File in the Form 10-Q contains an error that does not add the last three zeros in data reported as “thousands”.

Pursuant to Rule 12b-15 of the Rules and Regulations under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company has included with this Amendment No. 1 currently-dated certifications by the Company’s principal executive officer and principal financial officer, as required by Exchange Act Rules 13a-14(a) and (b).

No other changes have been made to the Form 10-Q.  This Amendment No. 1 speaks as of the original filing date of the Form 10-Q and does not reflect any events that may have occurred subsequent to the original filing date.

1

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		TELETECH HOLDINGS, INC.
		(Registrant)
Date: July 10, 2012	By:	/s/ Kenneth D. Tuchman
		Kenneth D. Tuchman
		Chairman and Chief Executive Officer
Date: July 10, 2012	By:	/s/ Regina M. Paolillo
		Regina M. Paolillo
		Chief Financial Officer

2

EXHIBIT INDEX

Exhibit No.	Description
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
32.1	Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
32.2	Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document

* Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Notes to the Consolidated Financial Statements, (ii) Consolidated Balance Sheets as of September 30, 2011 (unaudited) and December 31, 2010, (iii) Consolidated Statements of Operations for the three and nine months ended September 30, 2011 and 2010 (unaudited), (iv) Consolidated Statements of Stockholders’ Equity as of and for the nine months ended September 30, 2011 (unaudited), and (v) Consolidated Statements of Cash Flows for the nine months ended September 30, 2011 and 2010 (unaudited). Users of this data are advised pursuant to Rule 406T of Regulation S-T that this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections

3

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Kenneth D. Tuchman, certify that:

1.I have reviewed this quarterly report on Form 10-Q/A of TeleTech Holdings, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 10, 2012

By:	/s/ KENNETH D. TUCHMAN
	Kenneth D. Tuchman
	Chairman and Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Regina M. Paolillo, certify that:

1.I have reviewed this quarterly report on Form 10-Q/A of TeleTech Holdings, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 10, 2012

By:	/s/ REGINA M. PAOLILLO
	Regina M. Paolillo
	Chief Financial Officer
	(Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, the Chief Executive Officer of TeleTech Holdings, Inc. (the “Company”), hereby certifies that, to his knowledge on the date hereof:

(a)the Form 10-Q/A of the Company for the quarter ended September 30, 2011 filed on the date hereof with the Securities and Exchange Commission (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities and Exchange Act of 1934; and

(b)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ KENNETH D. TUCHMAN
	Kenneth D. Tuchman
	Chairman and Chief Executive Officer

Date: July 10, 2012

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES—OXLEY ACT OF 2002

The undersigned, the Chief Financial Officer of TeleTech Holdings, Inc. (the “Company”), hereby certifies that, to her knowledge on the date hereof:

(a)the Form 10–Q/A of the Company for the quarter ended September 30, 2011 filed on the date hereof with the Securities and Exchange Commission (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities and Exchange Act of 1934; and

(b)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Regina M. Paolillo
	Regina M. Paolillo
	Chief Financial Officer

Date: July 10, 2012

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ACQUISITIONS

9 Months Ended

Sep. 30, 2011

ACQUISITIONS [Abstract]

ACQUISITIONS

(2)       ACQUISITIONS

eLoyalty

On May 28, 2011, the Company acquired certain assets and assumed certain liabilities of eLoyalty Corporation (“eLoyalty”), related to the Integrated Contract Solutions (“ICS”) business unit, and the eLoyalty trade name. The ICS business unit focuses on helping clients improve customer service business performance through the implementation of a variety of service centers. ICS generates revenue in three ways: 1) managed services that support and maintain clients' customer service center environment over the long-term; 2) consulting services that assist the customer in implementation and integration of a customer service center solution; and 3) product resale through the sale of third party software and hardware. eLoyalty operates out of an office in Austin, TX with an additional administrative location in Chicago, IL and has approximately 160 employees.

The up-front cash consideration was $40.9 million, subject to certain balance sheet adjustments of ($3.0) million as defined in the purchase and sale agreement, for a total purchase price of $37.9 million.

As of September 30, 2011, TeleTech had paid the total net purchase price of $37.9 million. The Company recognized $0.3 million of acquisition related expenses as part of the eLoyalty purchase. These costs were recorded in Selling, general and administrative expense in the accompanying Consolidated Statements of Operations during the nine months ended September 30, 2011.

The following summarizes the preliminary estimated fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date (in thousands). Theestimates of fair value of identifiable assets acquired and liabilities assumed, are preliminary, pending completion of the valuation, thus are subject to revisions which may result in adjustments to the values presented below:

		Preliminary Estimates of Acquisition Date Fair Value
Cash		$	14
Accounts Receivable			7,702
Prepaid assets - cost deferrals			14,726
Property, plant and equipment			897
Other assets			869
Deferred tax asset			3,253
Customer relationships			11,700
Software			1,200
Noncompete agreements			900
Trademark			600
Consulting services backlog			500
Goodwill			21,614
			63,975
Accounts payable			2,156
Accrued expenses			1,211
Deferred revenue			22,525
Other			192
			26,084
	Total purchase price	$	37,891

The customer relationship intangible asset is being amortized over 11 years. The goodwill recognized from the eLoyalty acquisition is attributable primarily to the assembled workforce of eLoyalty and significant opportunity for Company growth and marketing based on additional service offerings and capabilities. Since this acquisition is treated as an asset acquisition for tax purposes, the goodwill and associated intangible assets will be deductible for income tax purposes. The operating results of eLoyalty are reported within the North American BPO segment from the date of acquisition.

Peppers & Rogers Group

On November 30, 2010, the Company acquired an 80% interest in Peppers & Rogers Group. PRG is a leading global management consulting firm specializing in customer-centric strategies for Global 1000 companies and is recognized as a leading authority on customer-based strategies with a deep understanding of the most powerful levers that drive customer loyalty and business results. PRG currently operates offices on six continents across the globe, including headquarters in Stamford, Connecticut, and Istanbul, Turkey, along with regional offices in Belgium, Germany, United Arab Emirates, South Africa, Lebanon and Kuwait. PRG has approximately 150 employees.

The up-front cash consideration paid was $15.0 million plus a working capital adjustment of $7.9 million as defined in the purchase and sale agreement. The working capital adjustment due to PRG former owners was paid during the nine months ended September 30, 2011. An additional $5.0 million payment is due on March 1, 2012. This $5.0 million payment was recognized at fair value using a discounted cash flow approach with a discount rate of 18.4%. This measurement is based on significant inputs not observable in the market, which are deemed to be Level 3 inputs. The fair value on the date of acquisition was approximately $4.4 million and was included in Other long-term liabilities in the Consolidated Balance Sheets as of December 31, 2010. The fair value as of September 30, 2011 was $4.9 million and was included in Other current liabilities in the Consolidated Balance Sheets as of September 30, 2011. This value will be accreted up to the $5.0 million payment using the effective interest rate method.

The purchase and sale agreement includes a contingent consideration arrangement that requires additional consideration to be paid in 2013 if PRG achieves a specified fiscal year 2012 earnings before interest, taxes depreciation and amortization (“EBITDA”) target. The range of the undiscounted amounts the Company could pay under the contingent consideration agreement is between zero and $5.0 million. The fair value of the contingent consideration recognized on the acquisition date was zero and was estimated by applying the income approach. This measure is based on significant inputs not observable in the market (Level 3 inputs). Key assumptions include (i) a discount rate of 30.6% percent and (ii) probability adjusted level of EBITDA between $9.0 million and $12.6 million. As of September 30, 2011, the fair value of the contingent consideration remains zero.

The fair value of the 20% noncontrolling interest of $6.0 million in PRG was estimated by applying a market approach. This fair value measurement is based on significant inputs not observable in the market (Level 3 inputs). The fair value estimates are based on assumed financial multiples of companies deemed similar to PRG, and assumed adjustments because of the lack of control or lack of marketability that market participants would consider when estimating fair value of the noncontrolling interest in PRG.

The purchase and sale agreement also included an option for the Company to acquire the remaining 20% interest in PRG exercisable in 2015 for a period of one year, with a one year extension (the “Initial Exercise Period”). If the Company does not acquire the remaining 20% of PRG pursuant to its call option during the Initial Exercise Period, PRG has an option to purchase the Company's 80% interest in PRG. The exercise price is based on a multiple of EBITDA as defined in the purchase and sale agreement.

The following summarizes the preliminary estimated fair values of the identifiable assets acquired and liabilities assumed at the acquisition date (in thousands). The estimates of fair value of identifiable assets acquired and liabilities assumed are preliminary, pending completion of the valuation, thus are subject to revisions which may result in adjustments to the values presented below.

		Preliminary Estimates of Acquisition Date Fair Value
Cash		$	2,202
Accounts Receivable			16,475
Property, plant and equipment			322
Other assets			847
Customer relationships			9,300
Trade name			6,400
Goodwill			7,295
			42,841
Accounts payable			1,519
Accrued expenses			1,967
Deferred tax liability			3,690
Deferred revenue			660
Line of credit			570
Other			1,562
			9,968
Noncontrolling interest			6,000
	Total purchase price	$	26,873

The goodwill recognized from the PRG acquisition is attributable primarily to the assembled workforce of PRG, expected synergies, and other factors. None of the goodwill is deductible for income tax purposes. The operating results of PRG are reported within the International BPO segment from the date of acquisition.

The acquired businesses contributed revenues of $25.4 million and $50.4 million and income from operations of $1.5 millionand $3.7 millionto the Company for the three and nine months ended September 30, 2011, respectively.

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OVERVIEW AND BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2011

OVERVIEW AND BASIS OF PRESENTATION [Abstract]

OVERVIEW AND BASIS OF PRESENTATION

(1)       OVERVIEW AND BASIS OF PRESENTATION

Overview

TeleTech Holdings, Inc. and its subsidiaries (“TeleTech” or the “Company”) serve their clients through the primary businesses of Business Process Outsourcing (“BPO”), which provides outsourced business process, customer management, hosted technology, premise based technology, consulting and marketing services for a variety of industries via operations in the U.S., Argentina, Australia, Belgium, Brazil, Canada, China, Costa Rica, England, Germany, Ghana, Kuwait, Ireland, Lebanon, Mexico, New Zealand, Northern Ireland, the Philippines, Scotland, South Africa, Spain, Turkey and the United Arab Emirates.

Basis of Presentation

The Consolidated Financial Statements are comprised of the accounts of TeleTech, its wholly owned subsidiaries, its 55% equity owned subsidiary Percepta, LLC, and its 80% interest in Peppers & Rogers Group (“PRG”) which was acquired on November 30, 2010 (see Note 2 for additional information). All intercompany balances and transactions have been eliminated in consolidation.

The accompanying unaudited Consolidated Financial Statements do not include all of the disclosures required by accounting principles generally accepted in the U.S. (“GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited Consolidated Financial Statements reflect all adjustments which, in the opinion of management, are necessary to present fairly the consolidated financial position of the Company as of September 30, 2011, and the consolidated results of operations of the Company for the three and nine months ended September 30, 2011 and 2010, and the cash flows of the Company for the nine months ended September 30, 2011 and 2010. Operating results for the nine months ended September 30, 2010 included a $2.0 million reduction to revenue for disputed service delivery issues which occurred in 2009. Operating results for the nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011.

These unaudited Consolidated Financial Statements should be read in conjunction with the Company's audited Consolidated Financial Statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2010.

Use of Estimates

The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates including those related to derivatives and hedging activities, income taxes including the valuation allowance for deferred tax assets, self-insurance reserves, litigation reserves, restructuring reserves, allowance for doubtful accounts and valuation of goodwill, long-lived and intangible assets. In the three months ended September 30, 2011, the Company recorded a reduction of $2.8 million to its variable accrued incentive compensation liability. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions.

Recently Issued Accounting Pronouncements

Effective January 1, 2011, the Company adopted new revenue guidance that requires an entity to apply the relative selling price allocation method in order to estimate a selling price for all units of accounting, including delivered items when vendor-specific objective evidence or acceptable third-party evidence does not exist. The adoption of this standard did not have a material impact on the Company's results of operations, financial position, or cash flows.

In December 2010, the FASB issued new guidance related to goodwill impairment testing. The new guidance clarifies the requirements of when to perform step 2 of impairment testing for goodwill for reporting units with zero or negative carrying amounts. The Company adopted this guidance on January 1, 2011 and it did not have a material impact on the Company's results of operations, financial position, or cash flows because the Company has not historically had or is expected to have a reporting unit with goodwill and a zero or negative carrying amount.

In May 2011, the FASB amended its guidance, to converge fair value measurement and disclosure guidance in U.S. GAAP with International Financial Reporting Standards (“IFRS”). IFRS is a comprehensive series of accounting standards published by the International Accounting Standards Board. The amendment changes the wording used to describe the requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements.The FASB does not intend for the amendment to result in a change in the application of the requirements in the current authoritative guidance. The amendment becomes effective prospectively for the Company's interim period ending March 31, 2012. Early application is not permitted. The Company does not expect the amendment to have a material impact on its financial position, result of operations or cash flows.

In June 2011, the FASB amended its guidance on the presentation of comprehensive income. Under the amended guidance, an entity has the option to present comprehensive income in either one or two consecutive financial statements. A single statement must present the components of net income and total net income, the components of other comprehensive income and total other comprehensive income, and a total for comprehensive income. In a two-statement approach, an entity must present the components of net income and total net income in the first statement. That statement must be immediately followed by a financial statement that presents the components of other comprehensive income, a total for other comprehensive income, and a total for comprehensive income. The option under current guidance that permits the presentation of other comprehensive income in the statement of changes in stockholders' equity has been eliminated. The amendment becomes effective retrospectively for the Company's interim period ending March 31, 2012. Early adoption is permitted.

In September 2011, the FASB amended its guidance on the annual testing of goodwill for impairment. The amended guidance will allow companies to assess qualitative factors to determine if it is more-likely-than-not that goodwill might be impaired and whether it is necessary to perform the two-step goodwill impairment test required under the current accounting standards. This guidance will be effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. Early adoption of this amended guidance is permitted. The Company will early adopt this amended guidance and will apply a more qualitative assessment for its annual goodwill impairment test to be performed December 1, 2011.The Company does not expect this guidance to have a material impact on its financial position, result of operations or cash flows.

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 30, 2011	Dec. 31, 2010
Current assets
Cash and cash equivalents	$ 169,809	$ 119,385
Accounts receivable, net	265,598	233,706
Prepaids and other current assets	40,068	38,486
Deferred tax assets, net	20,180	8,770
Income tax receivable	28,839	23,869
Total current assets	524,494	424,216
Long-term assets
Property, plant and equipment, net	92,379	105,528
Goodwill	73,990	52,707
Contract acquisition costs, net	2,072	2,782
Deferred tax assets, net	33,729	37,944
Other long-term assets	56,465	37,446
Total long-term assets	258,635	236,407
Total assets	783,129	660,623
Current liabilities
Accounts payable	21,401	23,599
Accrued employee compensation and benefits	73,008	72,406
Other accrued expenses	27,755	40,682
Income taxes payable	8,416	23,175
Deferred tax liabilities, net	1,712	2,235
Deferred revenue	16,063	5,570
Other current liabilities	9,181	4,584
Total current liabilities	157,536	172,251
Long-term liabilities
Line of credit	130,300	0
Negative investment in deconsolidated subsidiary	76	76
Deferred tax liabilities, net	3,294	3,559
Deferred rent	7,243	10,363
Other long-term liabilities	29,949	19,556
Total long-term liabilities	170,862	33,554
Total liabilities	328,398	205,805
Commitments and contingencies (Note 10)	0	0
Stockholders' equity
Preferred stock - $0.01 par value: 10,000,000 shares authorized; zero shares outstanding as of September 30, 2011 and December 31, 2010	0	0
Common stock - $0.01 par value; 150,000,000 shares authorized; 56,336,610 and 57,875,269 shares outstanding as of September 30, 2011 and December 31, 2010, respectively	563	579
Additional paid-in capital	348,519	349,157
Treasury stock at cost: 25,715,643 and 24,179,176 shares as of September 30, 2011 and December 31, 2010, respectively	(360,815)	(322,946)
Accumulated other comprehensive income	888	20,334
Retained earnings	454,663	396,602
Noncontrolling interest	10,913	11,092
Total stockholders' equity	454,731	454,818
Total liabilities and stockholders' equity	$ 783,129	$ 660,623

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010
Cash flows from operating activities
Net income	$ 61,030	$ 48,154
Adjustment to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	34,828	38,122
Amortization of contract acquisition costs	1,448	4,806
Amortization of debt issuance costs and other	435	447
Accretion expense	649	60
Provision for doubtful accounts	301	642
Gain on disposal of assets	(351)	(482)
Impairment losses	230	1,006
Deferred income taxes	5,582	2,757
Excess tax benefit from equity-based awards	(756)	0
Equity-based compensation expense	11,563	9,976
Loss (gain) on foreign currency derivatives	966	(994)
Gain on Newgen legal settlement, net of tax	0	(3,542)
Changes in assets and liabilities, net of acquisition:
Accounts receivable	(26,332)	24,461
Prepaids and other assets	(13,459)	18,882
Accounts payable and accrued expenses	(28,302)	(11,129)
Deferred revenue and other liabilities	(8,330)	(13,210)
Net cash provided by operating activities	39,502	119,956
Cash flows from investing activities
Proceeds from sale of property, plant, and equipment	2,197	0
Purchases of property, plant and equipment	(21,166)	(17,391)
Payment of contract acquisition costs	(738)	0
Investment in deconsolidated subsidiary	0	(3,600)
Acquisitions, net of cash acquired of $14	(45,787)	0
Net cash used in investing activities	(65,494)	(20,991)
Cash flows from financing activities
Proceeds from line of credit	556,800	745,700
Payments on line of credit	(426,500)	(745,700)
Payments on capital lease obligations and equipment financing	(1,646)	(3,167)
Dividends distributed to noncontrolling interest	(2,783)	(3,015)
Proceeds from exercise of stock options	8,528	1,117
Excess tax benefit from equity-based awards	5,276	143
Purchase of treasury stock	(58,367)	(48,319)
Payments of debt issuance costs	(22)	0
Net cash provided by (used in) financing activities	81,286	(53,241)
Effect of exchange rate changes on cash and cash equivalents	(4,870)	4,003
Increase in cash and cash equivalents	50,424	49,727
Cash and cash equivalents, beginning of period	119,385	109,424
Cash and cash equivalents, end of period	169,809	159,151
Supplemental disclosures
Cash paid for interest	2,908	1,514
Cash paid for income taxes	16,710	11,916
Non-cash investing and financing activities
Acquisition of equipment through installment purchase agreements	$ 0	$ 186

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Consolidated Statements of Cash Flows (Parenthetical) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2011
Cash flows from investing activities
Acquisition of PRG and eLoyalty business unit, net of cash acquired of $14	$ 14

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Consolidated Balance Sheets (Parenthetical) (USD $)	Sep. 30, 2011	Dec. 31, 2010
Stockholders' equity
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares outstanding	56,336,610	57,875,269
Treasury stock, shares	25,715,643	24,179,176

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COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2011

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

(10)       COMMITMENTS AND CONTINGENCIES

Credit Facility

On October 1, 2010, the Company entered into a credit agreement (the “Credit Agreement”) with a syndicate of lenders led by KeyBank National Association, Wells Fargo Bank, National Association, Bank of America, N.A., BBVA Compass, and JPMorgan Chase Bank, N.A. The Credit Agreement amended and restated in its entirety the Company's prior credit facility entered into during 2006. The five-year, $350.0 million revolving credit facility with expanded foreign borrower and multi-currency flexibility also includes a $150.0 million accordion provision providing an option to increase the aggregate commitment to $500.0 million.

The Company primarily utilizes its Credit Agreement to fund working capital, general operations, stock repurchases and other strategic activities, such as the acquisitions described in Note 2. As of September 30, 2011 and December 31, 2010, the Company had borrowings of $130.3 million and zero, respectively, under its Credit Agreement, and its average nine-month intra-period utilization was $104.7million and $59.7 million for the nine months ended September 30, 2011 and 2010, respectively. After consideration for issued letters of credit under the Credit Agreement, totaling $4.5 million, the Company's remaining borrowing capacity was $218.8 million as of September 30, 2011. As of September 30, 2011, the Company was in compliance with all covenants and conditions under its Credit Agreement.

Letters of Credit

As of September 30, 2011, outstanding letters of credit under the Credit Agreement totaled $4.5 million and primarily guaranteed workers' compensation and other insurance related obligations. As of September 30, 2011, letters of credit and contract performance guarantees issued outside of the Credit Agreement totaled $1.3 million.

Guarantees

Indebtedness under the Credit Agreement is guaranteed by certain of the Company's present and future domestic subsidiaries.

Legal Proceedings

From time to time, the Company has been involved in claims and lawsuits, both as plaintiff and defendant, which arise in the ordinary course of business. Accruals for claims or lawsuits have been provided for to the extent that losses are deemed both probable and estimable. Although the ultimate outcome of these claims or lawsuits cannot be ascertained, on the basis of present information and advice received from counsel, the Company believes that the disposition or ultimate resolution of such claims or lawsuits will not have a material adverse effect on its financial position, cash flows or results of operations.

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Document and Entity Information (USD $)	9 Months Ended
	Sep. 30, 2011	Oct. 27, 2011	Jun. 30, 2011
Document and Entity Information [Abstract]
Entity Registrant Name	TELETECH HOLDINGS INC
Entity Central Index Key	0001013880
Document Type	10-Q
Document Period End Date	Sep. 30, 2011
Amendment Flag	true
Amendment Description	The Interactive Data File in the original filing contains an error that does not add the last three zeros in data reported as “thousands”.
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 528,201,476
Entity Common Stock, Shares Outstanding		56,173,894

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COMPREHENSIVE INCOME

9 Months Ended

Sep. 30, 2011

COMPREHENSIVE INCOME [Abstract]

COMPREHENSIVE INCOME

(11)       COMPREHENSIVE INCOME

The following table sets forth comprehensive income (loss) for the periods indicated (amounts in thousands):

			Three Months Ended September 30,				Nine Months Ended September 30,
			2011		2010		2011		2010
Net income			$	26,435	$	19,788	$	61,030	$	48,154
Foreign currency translation adjustment				(16,612)		12,705		(9,731)		6,373
Derivatives valuation, net of tax				(3,834)		3,294		(10,414)		2,257
Other				113		48		334		(151)
	Total comprehensive income			6,102		35,835		41,219		56,633
Comprehensive income attributable to
	noncontrolling interest			(697)		(1,357)		(2,604)		(2,867)
	Comprehensive income attributable to
		TeleTech	$	5,405	$	34,478	$	38,615	$	53,766

The following table reconciles equity attributable to noncontrolling interest (amounts in thousands):

		Nine Months Ended September 30,
		2011		2010
Noncontrolling interest, January 1		$	11,092	$	5,478
Net income attributable to noncontrolling interest			2,969		2,795
Dividends distributed to noncontrolling interest			(2,783)		(3,015)
Foreign currency translation adjustments			(365)		72
	Noncontrolling interest, September 30	$	10,913	$	5,330

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Consolidated Statements of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
Consolidated Statements of Operations [Abstract]
Revenue	$ 304,235	$ 271,005	$ 878,850	$ 814,458
Operating expenses
Cost of services (exclusive of depreciation and amortization presented separately below)	220,795	193,996	630,274	586,808
Selling, general and administrative	43,445	40,572	138,529	123,721
Depreciation and amortization	11,807	12,452	34,828	38,122
Restructuring charges, net	1,616	3,579	2,298	6,352
Impairment losses	0	327	230	1,006
Total operating expenses	277,663	250,926	806,159	756,009
Income from operations	26,572	20,079	72,691	58,449
Other income (expense)
Interest income	896	571	2,282	1,631
Interest expense	(1,143)	(696)	(3,814)	(2,212)
Other income (expense), net	(386)	7,420	(647)	7,997
Total other income (expense)	(633)	7,295	(2,179)	7,416
Income before income taxes	25,939	27,374	70,512	65,865
Benefit from (provision for) income taxes	496	(7,586)	(9,482)	(17,711)
Net income	26,435	19,788	61,030	48,154
Net income attributable to noncontrolling interest	(1,064)	(1,118)	(2,969)	(2,795)
Net income attributable to TeleTech shareholders	$ 25,371	$ 18,670	$ 58,061	$ 45,359
Weighted average shares outstanding
Basic	56,476	59,808	56,790	60,926
Diluted	57,748	61,028	58,173	62,258
Net income per share attributable to TeleTech shareholders
Basic	$ 0.45	$ 0.31	$ 1.02	$ 0.74
Diluted	$ 0.44	$ 0.31	$ 1.00	$ 0.73

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GOODWILL

9 Months Ended

Sep. 30, 2011

GOODWILL [Abstract]

GOODWILL

(5)       GOODWILL

Goodwill consisted of the following (amounts in thousands):

		December 31, 2010		Acquisitions		Impairments		Effect of Foreign Currency		September 30, 2011
North American BPO		$	35,885	$	21,614	$	-	$	-	$	57,499
International BPO			16,822		-		-		(331)		16,491
	Total	$	52,707	$	21,614	$	-	$	(331)	$	73,990

The Company performs a goodwill impairment test on at least an annual basis. The Company uses a qualitative and/or quantitative assessment when completing its annual goodwill impairment test. The qualitative assessment will include the review of macroeconomic conditions as well as market and industry considerations. Historical and forecasted financial performance by reporting unit will also be reviewed when completing this type of assessment. The quantitative assessment of goodwill includes comparing a reporting unit's fair value to its carrying value.The calculation of fair value requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for the businesses, the useful life over which cash flows will occur and determination of the Company's weighted average cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for each reporting unit. The Company conducts its annual goodwill impairment test in the fourth quarter each year, or more frequently if indicators of impairment exist. During the quarter ended September 30, 2011, the Company assessed whether any such indicators of impairment existed, and concludedthat there were none.

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SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS

9 Months Ended

Sep. 30, 2011

SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS [Abstract]

SIGNIFICANT CLIENTS AND OTHER CONCENTRATIONS

(4)       SIGNIFICANT CLIENTS and other concentrations

The Company did not have any clients that contributed in excess of 10% of total revenue for the three or nine months ended September 30, 2011 and 2010.

The loss of one or more of its significant clients could have a material adverse effect on the Company's business, operating results, or financial condition. The Company does not require collateral from its clients. To limit the Company's credit risk, management performs periodic credit evaluations of its clients and maintains allowances for uncollectible accounts and may require pre-payment for services. Although the Company is impacted by economic conditions in various industry segments, management does not believe significant credit risk exists as of September 30, 2011.

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NET INCOME PER SHARE

9 Months Ended

Sep. 30, 2011

NET INCOME PER SHARE [Abstract]

NET INCOME PER SHARE

(12)       NET INCOME PER SHARE

The following table sets forth the computation of basic and diluted shares for the periods indicated (amounts in thousands):

				Three Months Ended September 30,				Nine Months Ended September 30,
				2011		2010		2011		2010
Shares used in basic earnings per share calculation					56,476		59,808		56,790		60,926
	Effect of dilutive securities:
		Stock options			673		681		817		844
		Restricted stock units			599		539		566		488
			Total effects of dilutive securities		1,272		1,220		1,383		1,332
Shares used in dilutive earnings per share calculation					57,748		61,028		58,173		62,258

For the three months ended September 30, 2011 and 2010, options to purchase 0.1 million and 0.2 million shares of common stock, respectively, were outstanding, but not included in the computation of diluted net income per share because the exercise price exceeded the value of the shares and the effect would have been anti–dilutive. For the nine months ended September 30, 2011 and 2010, options to purchase 0.1 million and 0.2 million shares of common stock, respectively, were outstanding, but not included in the computation of diluted net income per share because the effect would have been anti–dilutive. For the three months ended September 30, 2011 and 2010, restricted stock units (“RSUs”) of 1.1 million and 1.3 million, respectively, and for the nine months ended September 30, 2011 and 2010, RSUs of 0.6 million and 1.2 million, respectively, were outstanding, but not included in the computation of diluted net income per share because the effect would have been anti-dilutive.

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INCOME TAXES

9 Months Ended

Sep. 30, 2011

INCOME TAXES [Abstract]

INCOME TAXES

(8)       INCOME TAXES

The Company accounts for income taxes in accordance with the accounting literature forincome taxes, which requires recognition of deferred tax assets and liabilities for the expected future income tax consequences of transactions that have been included in the Consolidated Financial Statements. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse. Quarterly, the Company assesses the likelihood that its net deferred tax assets will be recovered. Based on the weight of all available evidence, both positive and negative, the Company records a valuation allowance against deferred tax assets when it is more-likely-than-not that a future tax benefit will not be realized.

In 2005, the Company, through its Canadian subsidiary, recorded a Canadian income tax receivable related to a refund of tax it considered probable of collecting. The potential refund related to income subjected to double taxation by the United States and originally reported to and assessed by Canada in 2001 and 2002. The Company, through the Competent Authorities of the United States and Canada requested relief from the double taxation through the Mutual Agreement procedure found in Article IX of the U.S. — Canada Income Tax Convention (the “Treaty”). At December 31, 2010, the Company continued to believe that collection of the Canadian income tax receivable was more likely than not. On February 20, 2011, the Company received notice that the Canada Revenue Agency (“CRA”) would not consider the Company's request for relief (please refer to Note 12 to the Company's Consolidated Financial Statements included in the Company's 2010 Annual Report on Form 10-K.) As of March 31, 2011, the Company could no longer conclude that collection of the Canadian income tax receivable was more likely than not and therefore derecognized the Canadian income tax receivable of $9.1 million through a charge to income tax expense during the first quarter of 2011. The Company continues to believe in the merits of its claim and that the CRA abused its discretion in refusing TeleTech Canada's request for relief from double taxation. As such, the Company is exploring options and intends to vigorously pursue any available remedies in response to the CRA decision.

During the firstquarter of 2011, the Company recognized a U.S. tax refund claim (including interest) of $10.2 million and established a corresponding reserve for uncertain tax positions of $7.3 million. This refund claim relates to previously disallowed deductions included in the Company's amended 2002 U.S. Income Tax return. The net benefit of $2.9 million was a reduction to income tax expense during the first quarter of 2011. During the second quarter of 2011, the Company and the Appeals branch of the IRS reached a mediated settlement. Since the settlement involved a refund in excess of $2 million the agreement is subject to review and approval by the Joint Committee on Taxation. Nevertheless, the Company considered the uncertainty around the issue to be “effectively settled”, and during the second quarter recorded an incremental benefit of $5.8 million (adjusting the $10.2 million accrual and $7.3 million reserve for uncertain tax positions recorded in the first quarter) through tax expense. During the third quarter, the Company received additional information on the settlement from the IRS allowing it to increase its mediated settlement recorded during the second quarter. In doing so, it recorded an additional $3.1 million benefit through tax expense during the third quarter. This is in addition to the $2.9 million recorded during the first quarter and $5.8 million recorded during the second quarter, bringing the total refund settlement (including interest) to $11.8 million.This refund settlement is expected to be received during the next 12 months and is included in Income tax receivable in the accompanying Consolidated Balance Sheets as of September 30, 2011. No further adjustments to the estimated refund are expected except for the continued accrual of interest in future periods until the refund is paid.

As of September 30, 2011, the Company had $53.9 million of deferred tax assets (after a $22.9 million valuation allowance) and net deferred tax assets (after deferred tax liabilities) of $48.9 million related to the U.S. and international tax jurisdictions whose recoverability is dependent upon future profitability.

The effective tax rate for the three and nine months ended September 30, 2011 was (1.9)% and 13.4%, respectively. The effective tax rate was influenced by the mediated settlement with the IRS related to U.S. tax refund claims, a benefit related to adjusting the transfer pricing terms between Australia and the Philippines, earnings in international jurisdictions currently under an income tax holiday, and the distribution of income between the U.S. and international tax jurisdictions. The effective tax rate for the three and nine months ended September 30, 2010 was 27.7% and 26.9%, respectively.

The Company increased its reserve for uncertain tax positions during the third quarter by $1.5 million related to a change in the rate used for intercompany transactions between its Australian and Philippines operations in 2011.

The Company is currently under audit of income taxes and payroll related taxes in the Philippines for 2008. Although the outcome of examinations by taxing authorities are always uncertain, it is the opinion of management that the resolution of these audits will not have a material effect on the Company's Consolidated Financial Statements.

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DERIVATIVES

9 Months Ended

Sep. 30, 2011

DERIVATIVES [Abstract]

DERIVATIVES

(6)       DERIVATIVES

Cash Flow Hedges

The Company enters into foreign exchange and interest rate derivatives. Foreign exchange derivatives entered into consist of forward and option contracts to reduce the Company's exposure to currency exchange rate fluctuations that are associated with forecasted revenue earned in foreign locations. Interest rate derivatives consist of interest rate swaps to reduce the Company's exposure to rate fluctuations associated with its variable rate debt. Upon proper qualification, these contracts are designated as cash flow hedges. It is the Company's policy to only enter into derivative contracts with investment grade counterparty financial institutions, and correspondingly, the fair value of derivative assets consider, among other factors, the creditworthiness of these counterparties. Conversely, the fair value of derivative liabilities reflects the Company's creditworthiness. As of September 30, 2011, the Company has not experienced, nor does it anticipate any issues related to derivative counterparty defaults. The following table summarizes the aggregate unrealized net gain or loss in Accumulated other comprehensive income (loss) for thethree and nine months ended September 30, 2011 and 2010 (amounts in thousands and net of tax):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
Aggregate unrealized net gain (loss) at beginning of period	$	511	$	3,431	$	7,091	$	4,468
Add: Net gain/(loss) from change in fair value of cash flow hedges		(2,504)		4,814		(4,935)		6,337
Less: Net (gain)/loss reclassified to earnings from effective hedges		(1,330)		(1,520)		(5,479)		(4,080)
Aggregate unrealized net gain (loss) at end of period	$	(3,323)	$	6,725	$	(3,323)	$	6,725

The Company's foreign exchange cash flow hedging instruments as of September 30, 2011 and December 31, 2010 are summarized as follows (amounts in thousands). All hedging instruments are forward contracts unless noted otherwise.

As of September 30, 2011	Local Currency Notional Amount	U.S. Dollar Notional Amount			% Maturing in the Next 12 Months			Contracts Maturing Through
Canadian Dollar	25,300	$	24,705			72.3	%	August 2013
Costa Rican Colons	2,750,000		5,340			100.0	%	August 2012
Philippine Peso	12,571,000		282,201	(1)		54.8	%	December 2014
Mexican Peso	771,000		60,814			62.6	%	April 2014
Mexican Peso Collars	140,298		12,000	(3)		75.0	%	December 2012
British Pound Sterling	9,267		14,673	(2)		54.8	%	June 2014
		$	399,733

As of December 31, 2010	Local Currency Notional Amount	U.S. Dollar Notional Amount
Canadian Dollar	10,200	$	8,493
Philippine Peso	7,731,000		169,364	(1)
Mexican Peso	311,500		22,383
British Pound Sterling	4,647		7,231	(2)
		$	207,471

(1)Includes contracts to purchase Philippine pesos in exchange for New Zealand dollars and Australian dollars, which are translated into equivalent U.S. dollars on September 30, 2011.

(2)Includes contracts to purchase British pound sterling in exchange for Euros, which are translated into equivalent U.S. dollars on September 30, 2011.

(3)The Mexican Peso Collars include call options with a floor total of MXN 140,298 and put options with a cap total of MXN 157,038.

The Company's interest rate swap arrangements as of September 30, 2011were as follows:

	Notional Amount		Variable Rate Received	Fixed Rate Paid			Contract Commencement Date	Contract Maturity Date
As of September 30, 2011	$	25 million	1 - month LIBOR		2.55	%	April 2012	April 2016
		15 million	1 - month LIBOR		3.14	%	May 2012	May 2017
	$	40 million

The Company did not have any interest rate swap arrangements as of December 31, 2010.

Fair Value Hedges

The Company enters into foreign exchange forward contracts to hedge against foreign currency exchange gains and losses on certain receivables and payables of the Company's foreign operations. Changes in the fair value of derivative instruments designated as fair value hedges, as well as the offsetting gain or loss on the hedged asset or liability, are recognized in earnings in Other income (expense), net. As of September 30, 2011 and December 31, 2010, the total notional amount of the Company's forward contracts used as fair value hedges were $51.1 million and $93.3 million, respectively.

Embedded Derivatives

In addition to hedging activities, the Company's foreign subsidiary in Argentina is party to U.S. dollar denominated lease contracts that the Company has determined contain embedded derivatives. As such, the Company bifurcates the embedded derivative features of the lease contracts and values these features as foreign currency derivatives.

Derivative Valuation and Settlements

The fair value of the Company's derivatives as of September 30, 2011 and December 31, 2010 were as follows (amounts in thousands):

		September 30, 2011
		Designated as Hedging Instruments				Not Designated as Hedging Instruments
Derivative contracts:		Foreign Exchange		Interest Rate		Foreign Exchange		Leases
Derivative classification:		Cash Flow		Cash Flow		Fair Value		Embedded Derivative
Fair value and location of derivative in the
	Consolidated Balance Sheet:
Prepaids and other current assets		$	4,342	$	-	$	-	$	-
Other long-term assets			2,117		-		-		-
Other current liabilities			(7,062)		-		(171)		(7)
Other long-term liabilities			(3,129)		(1,950)		-		-
	Total fair value of derivatives, net	$	(3,732)	$	(1,950)	$	(171)	$	(7)
		December 31, 2010
		Designated as Hedging Instruments				Not Designated as Hedging Instruments
Derivative contracts:		Foreign Exchange		Interest Rate		Foreign Exchange		Leases
Derivative classification:		Cash Flow		Cash Flow		Fair Value		Embedded Derivative
Fair value and location of derivative in
	the Consolidated Balance Sheet:
Prepaids and other current assets		$	10,602	$	-	$	783	$	-
Other long-term assets			2,081		-		-		-
Other current liabilities			(677)		-		(58)		(105)
Other long-term liabilities			(104)		-		-		(34)
	Total fair value of derivatives, net	$	11,902	$	-	$	725	$	(139)

The effect of derivative instruments on the Consolidated Statements of Operations for the three months ended September 30, 2011 and 2010 were as follows (amounts in thousands):

		Three Months Ended September 30,
		2011				2010
		Designated as Hedging Instruments				Designated as Hedging Instruments
Derivative contracts:		Foreign Exchange			Interest Rate	Foreign Exchange			Interest Rate
Derivative classification:		Cash Flow			Cash Flow	Cash Flow			Cash Flow
Amount of gain or (loss) recognized in other comprehensive
	income - effective portion, net of tax	$	(1,662)	$	(843)	$	4,814	$	-
Amount and location of net gain or (loss) reclassified from
	accumulated OCI to income - effective portion:
Revenue		$	2,216	$	-	$	2,491	$	-
Amount and location of net gain or (loss) reclassified from
	accumulated OCI to income - ineffective portion and
	amount excluded from effectiveness testing:
Other income (expense), net		$	-	$	-	$	-	$	-

		Three Months Ended September 30,
		2011						2010
		Not Designated as Hedging Instruments						Not Designated as Hedging Instruments
Derivative contracts:		Foreign Exchange				Leases		Foreign Exchange				Leases
Derivative classification:		Option and Forward Contracts		Fair Value		Embedded Derivative		Option and Forward Contracts		Fair Value		Embedded Derivative
Amount and location of net gain or (loss) recognized
	in the Consolidated Statement of Operations:
Costs of services		$	-	$	-	$	10	$	-	$	-	$	96
Other income (expense), net		$	-	$	(1,189)	$	-	$	-	$	3,256	$	-

The effect of derivative instruments on the Consolidated Statements of Operations for the nine months ended September 30, 2011 and 2010 were as follows (amounts in thousands):

		Nine Months Ended September 30,
		2011				2010
		Designated as Hedging Instruments				Designated as Hedging Instruments
Derivative contracts:		Foreign Exchange			Interest Rate	Foreign Exchange			Interest Rate
Derivative classification:		Cash Flow			Cash Flow	Cash Flow			Cash Flow
Amount of gain or (loss) recognized in other comprehensive
	income - effective portion, net of tax	$	(3,765)	$	(1,170)	$	6,337	$	-
Amount and location of net gain or (loss) reclassified from
	accumulated OCI to income - effective portion:
Revenue		$	9,131	$	-	$	6,688	$	-
Amount and location of net gain or (loss) reclassified from
	accumulated OCI to income - ineffective portion and
	amount excluded from effectiveness testing:
Other income (expense), net		$	-	$	-	$	-	$	-

		Nine Months Ended September 30,
		2011						2010
		Not Designated as Hedging Instruments						Not Designated as Hedging Instruments
Derivative contracts:		Foreign Exchange				Leases		Foreign Exchange				Leases
Derivative classification:		Option and Forward Contracts		Fair Value		Embedded Derivative		Option and Forward Contracts		Fair Value		Embedded Derivative
Amount and location of net gain or (loss) recognized
	in the Consolidated Statement of Operations:
Costs of services		$	-	$	-	$	132	$	-	$	-	$	172
Other income (expense), net		$	-	$	(686)	$	-	$	(42)	$	3,222	$	-

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FAIR VALUE

9 Months Ended

Sep. 30, 2011

FAIR VALUE [Abstract]

FAIR VALUE

(7)       FAIR VALUE

The authoritative guidance for fair value measurements establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires that the Company maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

Level 1 — Quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, similar assets and liabilities in markets that are not active or can be corroborated by observable market data.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The following presents information as of September 30, 2011 and December 31, 2010of the Company's assets and liabilities required to be measured at fair value on a recurring basis, as well as the fair value hierarchy used to determine their fair value.

Accounts Receivable and Payable- The amounts recorded in the accompanying balance sheets approximate fair value because of their short-term nature.

Debt - The Company's debt consists primarily of the Company's Credit Agreement, which permits floating-rate borrowings based upon the current Prime Rate or LIBOR plus a credit spread as determined by the Company's leverage ratio calculation (as defined in the Credit Agreement). As of September 30, 2011, the Company had $130.3 million of borrowings outstanding under the Credit Agreement. During the three and nine months ended September 30, 2011 outstanding borrowings accrued interest at an average rate of 1.6% and 1.7% per annum, respectively, excluding unused commitment fees. The amounts recorded in the accompanying balance sheets approximate fair value due to the variable nature of the debt.

Derivatives -Net derivative assets (liabilities) are measured at fair value on a recurring basis.The portfolio is valued using models based on market observable inputs, including both forward and spot foreign exchange rates, interest rates, implied volatility, and counterparty credit risk, including the ability of each party to execute its obligations under the contract. As of September 30, 2011, credit risk did not materially change the fair value of the Company's derivative contracts.

The following is a summary of the Company's fair value measurements for its net derivative assets (liabilities) as of September 30, 2011 and December 31, 2010 (amounts in thousands):

As of September 30, 2011
		Fair Value Measurements Using
		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
		(Level 1)		(Level 2)		(Level 3)		At Fair Value
Cash flow hedges		$	-	$	(3,732)	$	-	$	(3,732)
Interest rate swaps			-		(1,950)		-		(1,950)
Fair value hedges			-		(171)		-		(171)
Embedded derivatives			-		(7)		-		(7)
	Total net derivative asset (liability)	$	-	$	(5,860)	$	-	$	(5,860)
As of December 31, 2010
		Fair Value Measurements Using
		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
		(Level 1)		(Level 2)		(Level 3)		At Fair Value
Cash flow hedges		$	-	$	11,902	$	-	$	11,902
Fair value hedges			-		725		-		725
Embedded derivatives			-		(139)		-		(139)
	Total net derivative asset (liability)	$	-	$	12,488	$	-	$	12,488

The following is a summary of the Company's fair value measurements as of September 30, 2011 and December 31, 2010 (amounts in thousands):

As of September 30, 2011
			Fair Value Measurements Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
			(Level 1)		(Level 2)		(Level 3)
Assets
	Money market investments		$	-	$	15,907	$	-
	Derivative instruments, net			-		-		-
		Total assets	$	-	$	15,907	$	-
Liabilities
	Derivative instruments, net		$	-	$	(5,860)	$	-
	Deferred compensation plan liability			-		(3,706)		-
	Purchase price payable			-		-		(4,926)
		Total liabilities	$	-	$	(9,566)	$	(4,926)
As of December 31, 2010
			Fair Value Measurements Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
			(Level 1)		(Level 2)		(Level 3)
Assets
	Money market investments		$	-	$	19,668	$	-
	Derivative instruments, net			-		12,488		-
		Total assets	$	-	$	32,156	$	-
Liabilities
	Deferred compensation plan liability			-		(3,781)		-
	Purchase price payable			-		-		(4,506)
		Total liabilities	$	-	$	(3,781)	$	(4,506)

Money Market Investments — The Company invests in various well-diversified money market funds which are managed by financial institutions. These money market funds are not publicly traded, but have historically been highly liquid. The value of the money market funds is determined by the banks based upon the funds' net asset values (“NAV”). All of the money market funds currently permit daily investments and redemptions at a $1.00 NAV.

Deferred Compensation Plan — The Company maintains a non-qualified deferred compensation plan structured as a Rabbi trust for certain eligible employees. Participants in the deferred compensation plan select from a menu of phantom investment options for their deferral dollars offered by the Company each year, which are based upon changes in value of complementary, defined market investments. The deferred compensation liability represents the combined values of market investments against which participant accounts are tracked.

Purchase Price Payable —The Company has a future payable related to the purchase of PRG discussed in Note 2. As part of the PRG acquisition, the Company will pay $5.0 million on March 1, 2012. This payment was recognized at fair value using a discounted cash flow approach and a discount rate of 18.4%. This measurement is based on significant inputs not observable in the market. The Company will record accretion expense each period using the effective interest rate method until the payable reaches $5.0 million on March 1, 2012.

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RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES

9 Months Ended

Sep. 30, 2011

RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES [Abstract]

RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES

(9)       RESTRUCTURING CHARGES AND IMPAIRMENT LOSSES

Restructuring Charges

During the three and nine months ended September 30, 2011,the Company undertook a number of restructuring activities primarily associated with reductions in the Company's capacity and workforce in both the North American BPO and International BPO segments to better align the capacity and workforce with current business needs.

A summary of the expenses recorded in Restructuring, net in the accompanying Consolidated Statements of Operations for the three and nine months ended September 30, 2011 and 2010, respectively, is as follows (amounts in thousands):

			Three Months Ended September 30,				Nine Months Ended September 30,
			2011		2010		2011		2010
North American BPO
	Reduction in force		$	1,407	$	2,850	$	2,007	$	4,906
	Facility exit charges			65		-		72		-
	Revision of prior estimates			(35)		(139)		(379)		(144)
		Total	$	1,437	$	2,711	$	1,700	$	4,762
			Three Months Ended September 30,				Nine Months Ended September 30,
			2011		2010		2011		2010
International BPO
	Reduction in force		$	317	$	779	$	573	$	1,509
	Facility exit charges			-		89		-		89
	Revision of prior estimates			(138)		-		25		(8)
		Total	$	179	$	868	$	598	$	1,590

A roll-forward of the activity in the Company's restructuring accruals is as follows (amounts in thousands):

		Closure of Delivery Centers		Reduction in Force		Total
Balance as of December 31, 2010		$	695	$	8,267	$	8,962
	Expense		72		2,580		2,652
	Payments		(230)		(9,462)		(9,692)
	Revision of prior estimates		-		(354)		(354)
Balance as of September 30, 2011		$	537	$	1,031	$	1,568

The remaining reduction in force accrual is expected to be paid during 2011, with the remaining accrual for the closure of delivery centers to be paid or extinguished no later than 2012.

Impairment Losses

During each of the periods presented, the Company evaluated the recoverability of its leasehold improvement assets at certain delivery centers. An asset is considered to be impaired when the anticipated undiscounted future cash flows of an asset group are estimated to be less than the asset group's carrying value. The amount of impairment recognized is the difference between the carrying value of the asset group and its fair value. To determine fair value, the Company used Level 3 inputs in its discounted cash flows analysis. Assumptions included the amount and timing of estimated future cash flows and assumed discount rates. During the three months ended September 30, 2011, the Company did not recognize any impairment losses. During the nine months ended September 30, 2011, the Company recognized impairment losses related to leasehold improvement assets of $0.2 million in its International BPO segment.For the three months ended September 30, 2010, the Companyrecognized impairment losses related to leasehold improvement assetsof $0.3 million in its International BPO segment.

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DECONSOLIDATION OF A SUBSIDIARY

9 Months Ended

Sep. 30, 2011

DECONSOLIDATION OF A SUBSIDIARY [Abstract]

DECONSOLIDATION OF A SUBSIDIARY

(14)       DECONSOLIDATION OF A SUBSIDIARY

On December 22, 2008, Newgen Results Corporation (“Newgen”), a wholly-owned subsidiary of the Company, filed a voluntary petition for liquidation under Chapter 7 in the United States Bankruptcy Court for the District of Delaware. The consolidation of a majority-owned subsidiary is precluded where control does not rest with the majority owners and under legal reorganization or bankruptcy control rests with the Bankruptcy Court. Accordingly, the Company deconsolidated Newgen as of December 22, 2008.

On September 9, 2010, Newgen settled a legal claim for $3.6 million that was paid for by the Company on behalf of Newgen. As a result of the legal settlement, the Company recognized a $5.9 million gain in Other income (expense), net and a $2.3 million expense in Provision for income taxes during the year 2010.

As of September 30, 2011, the Company's negative investment in Newgen was $0.1 million as presented in the accompanying Consolidated Balance Sheets.

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Consolidated Statement of Stockholders' Equity (USD $) In Thousands, except Share data	Total	Equity of the Company Preferred Stock [Member]	Equity of the Company Common Stock [Member]	Equity of the Company Treasury Stock [Member]	Equity of the Company Additional Paid-in Capital [Member]	Equity of the Company Accumulated Other Comprehensive Income (Loss) [Member]	Equity of the Company Retained Earnings [Member]	Noncontrolling Interest [Member]
Beginning balance,value at Dec. 31, 2010	$ 454,818	$ 0	$ 579	$ (322,946)	$ 349,157	$ 20,334	$ 396,602	$ 11,092
Preferred stock beginning balance, share at Dec. 31, 2010	0	0
Common stock beginning balance, share at Dec. 31, 2010	57,875,269		57,875,000
Net income	61,030						58,061	2,969
Dividends distributed to noncontrolling interest	(2,783)							(2,783)
Foreign currency translation adjustments	(9,731)					(9,366)		(365)
Derivatives valuation, net of tax	(10,414)					(10,414)
Vesting of restricted stock units issued out of treasury, share			452,000
Vesting of restricted stock units issued out of treasury, value	(4,767)		4	6,187	(10,958)
Exercise of stock options, share			1,036,000
Exercise of stock options, value	8,528		10	14,281	(5,763)
Excess tax benefit from equity-based awards	4,520				4,520
Equity-based compensation expense	11,563				11,563
Purchases of common stock, share			(3,026,000)
Purchases of common stock, value	(58,367)		(30)	(58,337)
Other	334					334
Ending balance,value at Sep. 30, 2011	$ 454,731	$ 0	$ 563	$ (360,815)	$ 348,519	$ 888	$ 454,663	$ 10,913
Preferred stock ending balance, share at Sep. 30, 2011	0	0
Common stock ending balance, share at Sep. 30, 2011	56,336,610		56,337,000

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SEGMENT INFORMATION

9 Months Ended

Sep. 30, 2011

SEGMENT INFORMATION [Abstract]

SEGMENT INFORMATION

(3)       SEGMENT INFORMATION

The Company's BPO business provides outsourced business process, consulting, technology services and customer management services for a variety of industries through global delivery centers and represents 100% of total annual revenue. The Company's North American BPO segment is comprised of sales to clients based in North America (encompassing the U.S. and Canada), while the Company's International BPO segment is comprised of sales to clients based in countries outside of North America.

The Company allocates to each segment its portion of corporate operating expenses. All inter–company transactions between the reported segments for the periods presented have been eliminated.

The following tables present certain financial data by segment (amounts in thousands):

			Three Months Ended September 30,				Nine Months Ended September 30,
			2011		2010		2011		2010
Revenue
	North American BPO		$	219,891	$	204,978	$	612,825	$	625,426
	International BPO			84,344		66,027		266,025		189,032
		Total	$	304,235	$	271,005	$	878,850	$	814,458
Income (loss) from operations
	North American BPO		$	22,936	$	22,099	$	59,823	$	66,984
	International BPO			3,636		(2,020)		12,868		(8,535)
		Total	$	26,572	$	20,079	$	72,691	$	58,449

The following table presents revenue based upon the geographic location where the services are provided (amounts in thousands):

			Three Months Ended September 30,				Nine Months Ended September 30,
			2011		2010		2011		2010
Revenue
	United States		$	110,122	$	102,476	$	288,935	$	314,843
	Philippines			86,957		73,096		255,983		210,470
	Latin America			51,188		51,666		159,852		148,848
	Europe / Middle East / Africa			39,031		27,573		122,802		86,398
	Canada			12,829		11,708		38,674		40,105
	Asia Pacific			4,108		4,486		12,604		13,794
		Total	$	304,235	$	271,005	$	878,850	$	814,458

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EQUITY-BASED COMPENSATION PLANS

9 Months Ended

Sep. 30, 2011

EQUITY-BASED COMPENSATION PLANS [Abstract]

EQUITY-BASED COMPENSATION PLANS

(13)       EQUITY-BASED COMPENSATION PLANS

All equity–based payments to employees are recognized in the Consolidated Statements of Operations at the fair value of the award on the grant date.

Stock Options

As of September 30, 2011, there was approximately $3,000 of total unrecognized compensation cost (including the impact of expected forfeitures) related to unvested option arrangements granted under the Company's equity plans. The Company recognizes compensation expense straight–line over the vesting term of the option grant. The Company recognized compensation expense related to stock options of $2,600 and $29,000 for the three months ended September 30, 2011 and 2010, respectively. The Company recognized compensation expense related to stock options of $21,000 and $212,000 for the nine months ended September 30, 2011 and 2010, respectively.

Restricted Stock Unit Grants

During the nine months ended September 30, 2011 and 2010, the Company granted 611,580and 1,067,816 RSUs, respectively, to new and existing employees, which vest in equal installments over four years. The Company recognized compensation expense related to RSUs of $3.8 million and $11.5 million for the three and nine months ended September 30, 2011, respectively, and $3.4 million and $9.8 million for the three and nine months ended September 30, 2010, respectively. As of September 30, 2011, there was approximately $34.4 million of total unrecognized compensation cost (including the impact of expected forfeitures) related to RSUs granted under the Company's equity plans.

During the nine months ended September 30, 2011, the Company granted 43,500 performance-based RSUs to eLoyalty employees, which vest in equal installments over four years based on eLoyalty achieving specified revenue and operating income performance targets. As of September 30, 2011 and 2010, there were 93,500 and 100,000 performance-based RSUs outstanding. As of September 30, 2011 and 2010, the Company determined that it was not probable that any performance targets would be met related to all outstanding performance-based RSUs; therefore no expense was recognized for the nine months ended September 30, 2011 or 2010. The Company did not achieve the operating income performance targets in 2010, thus the 2010 performance RSUs were cancelled.