Segment and Related Information

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

Segment and Related Information

(7) Segment and Related Information

We are a major provider of integrated information management solutions and services for the public sector, with a focus on local governments.

We provide our software systems and services and appraisal services through four business units, which focus on the following products:

• Financial management and education software solutions;

• Financial management, municipal courts, and land and vital records software solutions;

• Courts and justice software solutions; and

• Appraisal and tax software solutions and property appraisal services.

In accordance with ASC 280-10, Segment Reporting, the financial management and education software solutions unit, financial management, municipal courts and land and vital records software solutions unit and the courts and justice software solutions unit meet the criteria for aggregation and are presented in one segment, Enterprise Software Solutions (“ESS”). The ESS segment provides municipal and county governments and schools with software systems to meet their information technology and automation needs for mission-critical “back-office” functions such as financial management and courts and justice processes. The Appraisal and Tax Software Solutions and Services (“ATSS”) segment provides systems and software that automate the appraisal and assessment of real and personal property as well as property appraisal outsourcing services for local governments and taxing authorities. Property appraisal outsourcing services include: the physical inspection of commercial and residential properties; data collection and processing; computer analysis for property valuation; preparation of tax rolls; community education; and arbitration between taxpayers and the assessing jurisdiction.

We evaluate performance based on several factors, of which the primary financial measure is business segment operating income. We define segment operating income as income before noncash amortization of intangible assets associated with their acquisition, interest expense and income taxes. Segment operating income includes intercompany transactions. The majority of intercompany transactions relate to contracts involving more than one unit and are valued based on the contractual arrangement. Segment operating income for corporate primarily consists of compensation costs for the executive management team and certain accounting and administrative staff and share-based compensation expense for the entire company. Corporate segment operating income also includes revenues and expenses related to a company-wide user conference.

For the three months ended June 30, 2014

	Enterprise		Appraisal and Tax
	Software		Software Solutions
	Solutions		and Services		Corporate			Totals
Revenues
Software licenses and royalties	$	11,349	$	734	$	—		$	12,083
Subscriptions		20,124		810		—			20,934
Software services		27,420		2,708		—			30,128
Maintenance		47,765		4,186		—			51,951
Appraisal services		—		5,444		—			5,444
Hardware and other		1,361		—		2,470			3,831
Intercompany		532		—		(532	)		—
Total revenues	$	108,551	$	13,882	$	1,938		$	124,371
Segment operating income	$	27,747	$	2,934	$	(5,487	)	$	25,194

For the six months ended June 30, 2014

	Enterprise		Appraisal and Tax
	Software		Software Solutions
	Solutions		and Services		Corporate			Totals
Revenues
Software licenses and royalties	$	22,145	$	1,170	$	—		$	23,315
Subscriptions		39,846		1,595		—			41,441
Software services		49,607		4,828		—			54,435
Maintenance		93,858		8,333		—			102,191
Appraisal services		—		10,295		—			10,295
Hardware and other		2,850		—		2,470			5,320
Intercompany		1,005		—		(1,005	)		—
Total revenues	$	209,311	$	26,221	$	1,465		$	236,997
Segment operating income	$	53,175	$	4,766	$	(11,275	)	$	46,666

For the three months ended June 30, 2013

	Enterprise		Appraisal and Tax
	Software		Software Solutions
	Solutions		and Services		Corporate			Totals
Revenues
Software licenses and royalties	$	9,621	$	469	$	—		$	10,090
Subscriptions		13,089		774		—			13,863
Software services		21,952		2,133		—			24,085
Maintenance		42,566		4,073		—			46,639
Appraisal services		—		5,056		—			5,056
Hardware and other		1,566		—		1,789			3,355
Intercompany		748		—		(748	)		—
Total revenues	$	89,542	$	12,505	$	1,041		$	103,088
Segment operating income	$	20,327	$	2,304	$	(5,631	)	$	17,000

For the six months ended June 30, 2013

	Enterprise		Appraisal and Tax
	Software		Software Solutions
	Solutions		and Services		Corporate			Totals
Revenues
Software licenses and royalties	$	17,722	$	1,198	$	—		$	18,920
Subscriptions		25,990		1,346		—			27,336
Software services		40,693		3,853		—			44,546
Maintenance		84,448		8,241		—			92,689
Appraisal services		—		10,647		—			10,647
Hardware and other		2,960		—		1,789			4,749
Intercompany		1,336		—		(1,336	)		—
Total revenues	$	173,149	$	25,285	$	453		$	198,887
Segment operating income	$	38,155	$	4,630	$	(9,635	)	$	33,150

	Three months ended						Six months ended
Reconciliation of reportable segment operating	June 30,						June 30,
income to the Company’s consolidated totals:	2014			2013			2014			2013
Total segment operating income	$	25,194		$	17,000		$	46,666		$	33,150
Amortization of acquired software		(444	)		(523	)		(925	)		(1,072	)
Amortization of customer and trade name intangibles		(1,128	)		(1,128	)		(2,257	)		(2,259	)
Other expense, net		(216	)		(296	)		(475	)		(634	)
Income before income taxes	$	23,406		$	15,053		$	43,009		$	29,185