NOTE 2. REVENUE

Based upon similar operational and economic characteristics, the Company’s revenues are disaggregated by its three strategic pillars: HCM (“HCM”), HR Outsourcing (“HRO”), and Global Solutions with separate disaggregation for PEO zero-margin benefits pass-through revenues and client fund interest revenues. The Company believes these revenue categories depict how the nature, amount, timing, and uncertainty of its revenue and cash flows are affected by economic factors.

HCM provides a suite of product offerings that assist employers of all types and sizes in all stages of the employment cycle, from recruitment to retirement. Global is generally consistent with the types of services provided within HCM but represent geographies outside of the United States and includes our multinational offerings. HCM and Global revenues are primarily attributable to fees for providing solutions for payroll, benefits, talent, retirement services and HR processing and fees charged to implement the Company's solutions for clients.

HRO provides a comprehensive human resources outsourcing solution, including offering benefits, providing workers’ compensation insurance, and administering state unemployment insurance, among other human resources functions. This revenue is primarily driven by the Professional Employer Organization Services (“PEO”). The Company has further disaggregated HRO to separate out its PEO zero-margin benefits pass-through revenues.

The Company recognizes client fund interest revenues on collected but not yet remitted funds held for clients in revenues as earned, as the collection, holding and remittance of these funds are critical components of providing these services.

The following tables provide details of revenue by our strategic pillars with disaggregation for PEO zero-margin benefits pass-throughs and client fund interest, and includes a reconciliation to the Company’s reportable segments (in millions):



	Years Ended
	June 30,
Types of Revenues	2019		2018		2017
HCM	$	6,441.8	$	6,204.9	$	6,020.5
HRO, excluding PEO zero-margin benefits pass-throughs	2,444.4		2,261.9		2,068.8
PEO zero-margin benefits pass-throughs	2,712.5		2,463.1		2,173.9
Global	2,014.6		1,931.3		1,711.4
Interest on funds held for clients	561.9		466.5		397.4
Total Revenues	$	14,175.2	$	13,327.7	$	12,372.0

Reconciliation of disaggregated revenue to our reportable segments for the fiscal year ended June 30, 2019:



Types of Revenues	Employer Services		PEO		Other			Total
HCM	$	6,447.5	$	—	$	(5.7	)	$	6,441.8
HRO, excluding PEO zero-margin benefits pass-throughs	924.0		1,525.0		(4.6		)	2,444.4
PEO zero-margin benefits pass-throughs	—		2,712.5		—			2,712.5
Global	2,014.6		—		—			2,014.6
Interest on funds held for clients	556.7		5.2		—			561.9
Total Segment Revenues	$	9,942.8	$	4,242.7	$	(10.3	)	$	14,175.2

Reconciliation of disaggregated revenue to our reportable segments for the fiscal year ended June 30, 2018:



Types of Revenues	Employer Services		PEO		Other			Total
HCM	$	6,210.2	$	—	$	(5.3	)	$	6,204.9
HRO, excluding PEO zero-margin benefits pass-throughs	851.3		1,414.7		(4.1		)	2,261.9
PEO zero-margin benefits pass-throughs	—		2,463.1		—			2,463.1
Global	1,931.3		—		—			1,931.3
Interest on funds held for clients	462.0		4.5		—			466.5
Total Segment Revenues	$	9,454.8	$	3,882.3	$	(9.4	)	$	13,327.7

Reconciliation of disaggregated revenue to our reportable segments for the fiscal year ended June 30, 2017:



Types of Revenues	Employer Services		PEO		Other			Total
HCM	$	6,026.7	$	—	$	(6.2	)	$	6,020.5
HRO, excluding PEO zero-margin benefits pass-throughs	782.6		1,290.6		(4.4		)	2,068.8
PEO zero-margin benefits pass-throughs	—		2,173.9		—			2,173.9
Global	1,711.4		—		—			1,711.4
Interest on funds held for clients	393.5		3.9		—			397.4
Total Segment Revenues	$	8,914.2	$	3,468.4	$	(10.6	)	$	12,372.0

Contract Balances

The timing of revenue recognition for our HCM, HRO and Global Solutions is consistent with the invoicing of clients, as invoicing occurs in the period the services are provided. Therefore, the Company does not recognize a contract asset or liability resulting from the timing of revenue recognition and invoicing.

Changes in deferred revenue related to set up fees for the twelve months ended June 30, 2019 were as follows:



Contract Liability
Contract liability, July 1, 2018	$	607.5
Recognition of revenue included in beginning of year contract liability	(177.9		)
Contract liability, net of revenue recognized on contracts during the period	148.5
Currency adjustments	(14.7		)
Contract liability, June 30, 2019	$	563.4

Deferred costs

Deferred costs are periodically reviewed for impairment. There were no impairment losses incurred during the period.

The balance is as follows:



	June 30,
	2019
Deferred costs to obtain a contract	$	992.3
Deferred costs to fulfill a contract	1,436.2
Total deferred contract costs (1)	$	2,428.5

(1) The amount of total deferred costs amortized during the twelve months ended June 30, 2019, June 30, 2018, and June 30, 2017 were $874.0 million, $837.4 million, and $787.9 million, respectively.