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Contractual Commitments, Contingencies, and Off-Balance Sheet Arrangements
 12 Months Ended
Jun. 30, 2020
Commitments and Contingencies Disclosure [Abstract]  
Contractual Commitments, Contingencies, and Off-Balance Sheet Arrangements CONTRACTUAL COMMITMENTS, CONTINGENCIES, AND OFF-BALANCE SHEET ARRANGEMENTS 
Data Center Agreements
In March 2010, the Company and IBM entered into an Information Technology Services Agreement (the “IT Services Agreement”), under which IBM provides certain aspects of the Company’s information technology infrastructure. Under the IT Services Agreement, IBM provides a broad range of technology services to the Company including supporting its mainframe, midrange, network and data center operations, as well as providing disaster recovery services. The migration of the data center processing to IBM was completed in August 2012. The IT Services Agreement would have expired on June 30, 2022, but a two-year extension was signed in March 2015, amending the expiration date to June 30, 2024. In December 2019, the Company and IBM amended and restated the IT Services Agreement (the “Amended IT Services Agreement”), which now expires on June 30, 2027. The Company has the option of incorporating additional services into the Amended IT Services Agreement over time. The Company may renew the term of the Amended IT Services Agreement for up to one additional 12-month period. Fixed minimum commitments remaining under the Amended IT Services Agreement at June 30, 2020 are $251.7 million through fiscal year 2027, the final year of the Amended IT Services Agreement.
In December 2019, the Company and IBM entered into an information technology agreement for private cloud services (the “IBM Private Cloud Agreement”) under which IBM will operate, manage and support the Company’s private cloud global distributed platforms and products, and operate and manage certain Company networks. The IBM Private Cloud Agreement has an initial term of approximately 10 years and three months, expiring on March 31, 2030. As a result of the IBM Private Cloud Agreement, the Company transferred certain of its employees in April 2020 to IBM and its affiliates, and such transferred employees are expected to continue providing services to the Company on behalf of IBM under the IBM Private Cloud Agreement. Pursuant to the IBM Private Cloud Agreement, the Company has agreed to transfer the ownership of certain Company-owned hardware (the “Hardware”) located at Company facilities worldwide along with the Company’s maintenance agreements (“Maintenance Contracts”) associated with the Hardware to IBM. The transfer of the Hardware and Maintenance Contracts to IBM is expected to close no later than September 30, 2020. The Company concluded that the Hardware qualifies as assets held for sale since the Company has committed to a plan of disposal expected to be completed within a year, and therefore, has recorded the Hardware at fair value less costs to dispose based on the expected selling price to IBM (a Level 3 fair value measurement as defined in Note 7, “Fair Value of Financial Instruments”). Accordingly, the Company has recorded a non-cash pre-tax charge of $30.4 million for the year ended June 30, 2020, equal to the difference between the Hardware’s carrying value and estimated fair value less costs to dispose, included as part of Cost of revenues on the Company’s Consolidated Statements of Earnings and is included in Other for purposes of the Company's segment reporting. As of June 30, 2020, the Hardware classified as assets held for sale has a carrying amount of $18.0 million and is included in the Company’s Other current assets line item on the Consolidated Balance Sheets. Fixed minimum commitments remaining under the IBM Private Cloud Agreement at June 30, 2020 are $236.7 million through March 31, 2030, the final year of the contract.
In March 2014, the Company and IBM United Kingdom Limited (“IBM UK”) entered into an Information Technology Services Agreement (the “EU IT Services Agreement”), under which IBM UK provides data center services supporting the Company’s technology outsourcing services for certain clients in Europe and Asia. The EU IT Services Agreement would have expired in October 2023. In December 2019, the Company amended the existing EU IT Services Agreement whereby the Company will migrate from the existing dedicated on-premise solution to a managed Broadridge private cloud environment provided by IBM, as well as extended the term of the EU IT Services Agreement to June 2029 (the “Amended EU IT Services Agreement”). The Company has the right to renew the term of the Amended EU IT Services Agreement for up to one additional 12-month term or one additional 24-month term. Fixed minimum commitments remaining under the Amended EU IT Services Agreement at June 30, 2020 are $23.9 million through fiscal year 2029, the final year of the contract.
The total annual expenses related to these IBM agreements was $118.7 million, $106.1 million, and $107.5 million for the fiscal years ended June 30, 2020, 2019 and 2018, respectively.
The following table summarizes the capitalized costs related to data center agreements as of June 30, 2020:
 Amended IT Services AgreementAmended EU IT Services AgreementTotal
 (in millions)
Capitalized costs, beginning balance$62.3  $5.0  $67.3  
Capitalized costs incurred0.3  1.6  1.8  
Impact of foreign currency exchange—  (0.2) (0.2) 
Total capitalized costs, ending balance62.6  6.3  68.9  
Total accumulated amortization(40.1) (4.3) (44.4) 
Net Deferred IBM Costs$22.5  $2.0  $24.5  
The following table summarizes the respective total annual amortization expense of capitalized costs related to data center agreements:
 Years ended June 30,
 202020192018
 (in millions)
Amended IT Services Agreement$4.2  $5.3  $5.3  
Amended EU IT Services Agreement1.8  0.5  0.5  
     Total expenses $6.1  $5.8  $5.8  
Investments
At June 30, 2020, the Company has a future commitment to fund $3.5 million to one of the Company’s investees.
Contractual Obligations
The Company has obligations under the Amended IT Services Agreement, the Amended EU IT Services Agreement, the IBM Private Cloud Agreement, software license agreements including hosted software arrangements, and software and hardware maintenance and support agreements.
The following table summarizes the total expenses related to these agreements:
 Years ended June 30,
 202020192018
 (in millions)
Data center expenses$118.7  $106.1  $107.5  
Software license agreements57.0  37.3  33.7  
Software/hardware maintenance agreements72.1  65.0  63.5  
     Total expenses $247.9  $208.4  $204.6  
The minimum commitments at June 30, 2020 for the aforementioned Amended IT Services Agreement, the Amended EU IT Services Agreement, the IBM Private Cloud Agreement, software license agreements including hosted software arrangements, and software and hardware maintenance and support agreements are as follows:
Years Ending June 30,(in millions)
2021$93.4  
202288.3  
202385.1  
202479.9  
202564.0  
Thereafter170.0  
     Total$580.8  
Other
In the normal course of business, the Company is subject to various claims and litigation. While the outcome of any claim or litigation is inherently unpredictable, the Company believes that the ultimate resolution of these matters will not, individually or in the aggregate, result in a material impact on its financial condition, results of operations or cash flows.
It is not the Company’s business practice to enter into off-balance sheet arrangements. However, the Company is exposed to market risk from changes in foreign currency exchange rates that could impact its financial position, results of operations, and cash flows. The Company manages its exposure to these market risks through its regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. The Company may use derivative financial instruments as risk management tools and not for trading purposes. The Company was not a party to any derivative financial instruments as of June 30, 2020 and 2019.
In the normal course of business, the Company also enters into contracts in which it makes representations and warranties that relate to the performance of the Company’s products and services. The Company does not expect any material losses related to such representations and warranties, or collateral arrangements.
The Company’s business process outsourcing and mutual fund processing services are performed by Broadridge Business Process Outsourcing, LLC (“BBPO”), an indirect wholly-owned subsidiary, which is a broker-dealer registered with the Securities and Exchange Commission and a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”). Although BBPO’s FINRA membership agreement allows it to engage in clearing and the retailing of corporate securities in addition to mutual fund retailing on a wire order basis, BBPO does not clear customer transactions, process any retail business or carry customer accounts. As a registered broker-dealer and member of FINRA, BBPO is subject to the Uniform Net Capital Rule 15c3-1 of the Securities Exchange Act of 1934, as amended, which requires BBPO to maintain a minimum net capital amount. At June 30, 2020, BBPO was in compliance with this capital requirement.
BBPO, as a “Managing Clearing Member” of the Options Clearing Corporation (the “OCC”), is also subject to OCC Rule 309(b) with respect to the business process outsourcing services that it provides to other OCC “Managed Clearing Member” broker-dealers. OCC Rule 309(b) requires BBPO to maintain a minimum net capital amount. At June 30, 2020, BBPO was in compliance with this capital requirement.
In addition, Matrix Trust Company (“Matrix Trust”), a subsidiary of the Company, is a Colorado State non-depository trust company and National Securities Clearing Corporation trust member, whose primary business is to provide cash agent, custodial and directed trustee services to institutional customers, and investment management services to collective investment trust funds. As a result, Matrix Trust is subject to various regulatory capital requirements administered by the Colorado Division of Banking and the Arizona Department of Financial Institutions, as well as the National Securities Clearing Corporation. Specific capital requirements that involve quantitative measures of assets, liabilities, and certain off-balance sheet items, when applicable, must be met. At June 30, 2020, Matrix Trust was in compliance with its capital requirements.