Discontinued Operations and Divestitures

6 Months Ended

Jun. 30, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations and Divestitures

13. Discontinued Operations and Divestitures

CBIZ has divested, through sale or closure, business operations that do not contribute to the Company’s long-term objectives for growth or that are not complementary to its target service offerings and markets. Divestitures are classified as discontinued operations provided they meet the criteria as provided in Financial Accounting Standards Board (“FASB”) Accounting Standard Update (“ASU”) No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of an Entity (Topic 360)” which was effective January 1, 2015. Discontinued operations through December 31, 2014 followed the criteria in FASB Accounting Standards Codification 205 “Presentation of Financial Statements – Discontinued Operations – Other Presentation Matters.”

Discontinued Operations

Revenue and results from operations of discontinued operations are separately reported as “Loss from operations of discontinued operations, net of tax” in the accompanying Consolidated Statements of Comprehensive Income. For the six months ended June 30, 2015, the loss on operations of discontinued operations represents the results from the operations of two small businesses under the Financial Services segment that were discontinued in December 2014, one of which was sold on June 1, 2015. For the six months ended June 30, 2014, the loss on operations of discontinued operations represents the results from operations of the two businesses mentioned above as well as the Company’s property tax business located in Leawood, Kansas that was discontinued in December 2013 and subsequently sold on June 1, 2014.

Revenue and results from operations of discontinued operations for the three and six months ended June 30, 2015 and 2014 were as follows (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Revenue	$	2,391		$	3,340		$	5,907		$	7,485
Loss from discontinued operations before income tax	$	(477	)	$	(701	)	$	(993	)	$	(1,237	)
Income tax benefit		(147	)		(389	)		(328	)		(662	)
Loss from discontinued operations, net of tax	$	(330	)	$	(312	)	$	(665	)	$	(575	)

Losses from the sale of discontinued operations are recorded as “(Loss) on disposal of discontinued operations, net of tax”, in the accompanying Consolidated Statements of Comprehensive Income. In addition, proceeds that are contingent upon a divested operation’s actual future performance are recorded as “(Loss) on disposal of discontinued operations, net of tax” in the period they are earned.

During the three and six months ended June 30, 2015, CBIZ sold a small business within the Financial Services segment that was discontinued in December 2014. During the six months ended June 30, 2014, CBIZ sold its property tax business located in Leawood, Kansas. In addition, a loss was recorded representing the finalization of the working capital adjustment related to the August 2013 sale of Medical Management Professionals.

For the three and six months ended June 30, 2015 and 2014, gain (loss) on the disposal of discontinued operations was as follows (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Gain (loss) on disposal of discontinued operations, before income tax	$	129		$	(11	)	$	129		$	(885	)
Income tax (benefit) expense		(161	)		16			(161	)		(384	)
Gain (loss) on disposal of discontinued operations, net of tax	$	290		$	(27	)	$	290		$	(501	)

At June 30, 2015 and December 31, 2014, the assets and liabilities of businesses classified as discontinued operations were reported separately in the accompanying consolidated financial statements and consisted of the following (in thousands):

	June 30,		December 31,
	2015		2014
Assets:
Accounts receivable, net	$	4,570	$	4,699
Other assets		327		530
Assets of discontinued operations	$	4,897	$	5,229
Liabilities:
Accounts payable	$	414	$	388
Accrued personnel		550		591
Accrued expenses		314		324
Liabilities of discontinued operations	$	1,278	$	1,303

Divestitures

Gains and losses from divested operations and assets that do not qualify for treatment as discontinued operations are recorded as “Gain on sale of operations, net” in the accompanying Consolidated Statements of Comprehensive Income.