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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Wageworks Inc | NYSE:WAGE | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 51.34 | 0 | 01:00:00 |
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(Mark One)
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
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94-3351864
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(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification Number)
|
|
1100 Park Place, 4th Floor
San Mateo, California 94403
(Address of principal executive offices, including zip code)
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Large accelerated filer
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[X]
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Accelerated filer
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Non-accelerated filer
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(Do not check if a smaller reporting company)
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Smaller reporting company
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Emerging growth company
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Page No.
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June 30, 2018
|
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December 31, 2017
|
||||
|
(Unaudited)
|
|
Derived from
Audited Financial
Statements
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
|
|||
Cash and cash equivalents
|
$
|
712,194
|
|
|
$
|
779,345
|
|
Restricted cash
|
332
|
|
|
332
|
|
||
Short-term investments
|
257,095
|
|
|
195,534
|
|
||
Receivables, net
|
87,137
|
|
|
107,547
|
|
||
Prepaid expenses and other current assets
|
23,610
|
|
|
29,271
|
|
||
Total current assets
|
1,080,368
|
|
|
1,112,029
|
|
||
Property and equipment, net
|
78,486
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|
|
68,742
|
|
||
Goodwill
|
297,409
|
|
|
297,409
|
|
||
Acquired intangible assets, net
|
142,850
|
|
|
155,369
|
|
||
Deferred tax assets, net
|
8,008
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|
|
10,143
|
|
||
Other assets
|
28,839
|
|
|
8,291
|
|
||
Total assets
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$
|
1,635,960
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|
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$
|
1,651,983
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
89,047
|
|
|
$
|
89,977
|
|
Customer obligations
|
637,489
|
|
|
695,368
|
|
||
Other current liabilities
|
2,459
|
|
|
628
|
|
||
Total current liabilities
|
728,995
|
|
|
785,973
|
|
||
Long-term debt, net of financing costs
|
244,657
|
|
|
244,915
|
|
||
Other non-current liabilities
|
10,721
|
|
|
8,845
|
|
||
Total liabilities
|
984,373
|
|
|
1,039,733
|
|
||
Commitments and Contingencies (Note 14)
|
|
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|
||||
Stockholders' Equity:
|
|
|
|
||||
Common stock, par value $0.001 per share (authorized 1,000,000 shares; 40,333 shares issued and 39,853 shares outstanding at June 30, 2018 and 40,251 shares issued and 39,771 shares outstanding at December 31, 2017)
|
41
|
|
|
41
|
|
||
Additional paid-in capital
|
573,254
|
|
|
562,131
|
|
||
Treasury stock at cost (480 shares at June 30, 2018 and December 31, 2017)
|
(22,309
|
)
|
|
(22,309
|
)
|
||
Accumulated other comprehensive loss
|
(1,038
|
)
|
|
(354
|
)
|
||
Retained earnings
|
101,639
|
|
|
72,741
|
|
||
Total stockholders’ equity
|
651,587
|
|
|
612,250
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,635,960
|
|
|
$
|
1,651,983
|
|
|
Three Months Ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Healthcare
|
$
|
68,104
|
|
|
$
|
68,202
|
|
|
$
|
143,361
|
|
|
$
|
142,876
|
|
COBRA
|
26,200
|
|
|
27,018
|
|
|
55,035
|
|
|
55,568
|
|
||||
Commuter
|
18,847
|
|
|
17,836
|
|
|
37,725
|
|
|
36,379
|
|
||||
Other
|
3,357
|
|
|
4,076
|
|
|
7,028
|
|
|
8,346
|
|
||||
Total revenues
|
116,508
|
|
|
117,132
|
|
|
243,149
|
|
|
243,169
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of revenues (excluding amortization of internal use software)
|
36,143
|
|
|
43,319
|
|
|
81,386
|
|
|
91,407
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|
||||
Technology and development
|
13,392
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|
|
14,515
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|
26,425
|
|
|
29,786
|
|
||||
Sales and marketing
|
18,521
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|
|
14,728
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|
|
36,859
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|
|
30,807
|
|
||||
General and administrative
|
18,898
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|
|
18,459
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|
|
44,147
|
|
|
31,959
|
|
||||
Amortization
|
10,191
|
|
|
9,393
|
|
|
20,182
|
|
|
18,630
|
|
||||
Employee termination and other charges
|
2,853
|
|
|
917
|
|
|
2,853
|
|
|
1,648
|
|
||||
Total operating expenses
|
99,998
|
|
|
101,331
|
|
|
211,852
|
|
|
204,237
|
|
||||
Income from operations
|
16,510
|
|
|
15,801
|
|
|
31,297
|
|
|
38,932
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest income
|
1,432
|
|
|
95
|
|
|
2,703
|
|
|
162
|
|
||||
Interest expense
|
(2,420
|
)
|
|
(1,766
|
)
|
|
(4,602
|
)
|
|
(3,202
|
)
|
||||
Other income (expense), net
|
23
|
|
|
(9
|
)
|
|
18
|
|
|
(230
|
)
|
||||
Income before income taxes
|
15,545
|
|
|
14,121
|
|
|
29,416
|
|
|
35,662
|
|
||||
Income tax (provision) benefit
|
(4,621
|
)
|
|
6,157
|
|
|
(7,473
|
)
|
|
673
|
|
||||
Net income
|
$
|
10,924
|
|
|
$
|
20,278
|
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$
|
21,943
|
|
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$
|
36,335
|
|
Net income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.27
|
|
|
$
|
0.54
|
|
|
$
|
0.55
|
|
|
$
|
0.98
|
|
Diluted
|
$
|
0.27
|
|
|
$
|
0.53
|
|
|
$
|
0.54
|
|
|
$
|
0.94
|
|
Shares used in computing net income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
39,853
|
|
|
37,419
|
|
|
39,838
|
|
|
37,209
|
|
||||
Diluted
|
40,412
|
|
|
38,613
|
|
|
40,446
|
|
|
38,514
|
|
|
Three Months Ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income
|
$
|
10,924
|
|
|
$
|
20,278
|
|
|
$
|
21,943
|
|
|
$
|
36,335
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Net unrealized gain (loss) on short-term investments, net of tax
|
46
|
|
|
—
|
|
|
(686
|
)
|
|
—
|
|
||||
Other comprehensive income (loss), net of tax
|
46
|
|
|
—
|
|
|
(686
|
)
|
|
—
|
|
||||
Total comprehensive income
|
$
|
10,970
|
|
|
$
|
20,278
|
|
|
$
|
21,257
|
|
|
$
|
36,335
|
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
21,943
|
|
|
$
|
36,335
|
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation
|
6,651
|
|
|
5,221
|
|
||
Amortization
|
20,183
|
|
|
18,630
|
|
||
Amortization of debt issuance costs
|
242
|
|
|
125
|
|
||
Accrued interest on debt securities
|
(413
|
)
|
|
—
|
|
||
Amortization of commissions
|
(1,576
|
)
|
|
—
|
|
||
Stock-based compensation expense
|
8,881
|
|
|
10,812
|
|
||
Loss on disposal of fixed assets
|
34
|
|
|
91
|
|
||
(Recoveries from) provision for doubtful accounts
|
98
|
|
|
(141
|
)
|
||
Deferred taxes
|
—
|
|
|
593
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables
|
20,312
|
|
|
(56,269
|
)
|
||
Prepaid expenses and other current assets
|
10,116
|
|
|
(12,073
|
)
|
||
Other assets
|
(14,109
|
)
|
|
809
|
|
||
Accounts payable and accrued expenses
|
(1,772
|
)
|
|
27,792
|
|
||
Customer obligations
|
(57,879
|
)
|
|
(42,466
|
)
|
||
Other liabilities
|
848
|
|
|
2,242
|
|
||
Net cash provided by (used in) operating activities
|
13,559
|
|
|
(8,299
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Purchases of property and equipment
|
(19,834
|
)
|
|
(17,534
|
)
|
||
Purchases of investments
|
(122,823
|
)
|
|
—
|
|
||
Proceeds from sales of investments
|
4,096
|
|
|
—
|
|
||
Proceeds from maturities of investments
|
56,665
|
|
|
—
|
|
||
Purchases of intangible assets
|
(209
|
)
|
|
(397
|
)
|
||
Net cash used in investing activities
|
(82,105
|
)
|
|
(17,931
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from public stock offering, net of underwriting discounts, commissions and other costs
|
—
|
|
|
131,177
|
|
||
Proceeds from exercise of common stock options
|
1,396
|
|
|
10,002
|
|
||
Proceeds from issuance of common stock under Employee Stock Purchase Plan
|
869
|
|
|
1,511
|
|
||
Payments of debt issuance costs
|
(500
|
)
|
|
(1,852
|
)
|
||
Payments of debt principal
|
—
|
|
|
(2,500
|
)
|
||
Payment of shares withheld related to restricted stock units
|
(218
|
)
|
|
—
|
|
||
Payment of capital lease obligations
|
(152
|
)
|
|
(147
|
)
|
||
Taxes paid related to net share settlement of stock-based compensation arrangements
|
—
|
|
|
(8,437
|
)
|
||
Net cash provided by financing activities
|
1,395
|
|
|
129,754
|
|
||
Net (decrease) increase in cash and cash equivalents, unrestricted and restricted
|
(67,151
|
)
|
|
103,524
|
|
||
Cash and cash equivalents at beginning of period, unrestricted and restricted
|
779,677
|
|
|
672,941
|
|
||
Cash and cash equivalents, unrestricted and restricted, at end of period
|
$
|
712,526
|
|
|
$
|
776,465
|
|
Supplemental cash flow disclosure:
|
|
|
|
||||
Cash paid during the period for:
|
|
|
|
||||
Interest
|
$
|
4,139
|
|
|
$
|
2,808
|
|
Income taxes
|
$
|
1,979
|
|
|
$
|
2,743
|
|
Noncash financing and investing activities:
|
|
|
|
||||
Property and equipment, accrued but not paid
|
$
|
3,168
|
|
|
$
|
1,922
|
|
Public stock offering costs, accrued but not paid
|
$
|
—
|
|
|
$
|
402
|
|
Property and equipment financed under capital lease
|
$
|
142
|
|
|
$
|
263
|
|
•
|
Identification of the contract, or contracts, with the customer;
|
•
|
Identification of the performance obligations in the contract;
|
•
|
Determination of the transaction price;
|
•
|
Allocation of the transaction price to the performance obligations in the contract; and
|
•
|
Recognition of the revenue when, or as, the Company satisfies a performance obligation.
|
•
|
Healthcare and commuter programs include revenues generated from the monthly administration services based on employee participant levels and interchange and other commission revenues.
|
•
|
COBRA revenue is generated from the administration of continuation of coverage services for participants who are no longer eligible for the employer’s health benefits, such as medical, dental, vision and for the continued administration of employee participants’ Health Reimbursement Arrangements (“HRAs”), and certain healthcare Flexible Spending Accounts (“FSAs”).
|
•
|
Other revenue includes services related to enrollment and eligibility, non-healthcare, employee account administration (i.e., tuition and health club reimbursements).
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Cash and cash equivalents, unrestricted
|
|
$
|
712,194
|
|
|
$
|
779,345
|
|
Cash and cash equivalents, restricted
|
|
332
|
|
|
332
|
|
||
Total unrestricted and restricted cash and cash equivalents
|
|
$
|
712,526
|
|
|
$
|
779,677
|
|
•
|
Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.
|
•
|
Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.
|
•
|
Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date.
|
•
|
A significant adverse change in legal factors or in the business climate
|
•
|
An adverse action or assessment by a regulator
|
•
|
Unanticipated competition
|
•
|
A loss of key personnel
|
•
|
A more likely than not expectation that a reporting unit or a significant portion of a reporting unit will be sold or otherwise disposed of
|
•
|
The nature and history of current or cumulative financial reporting income or losses;
|
•
|
Sources of future taxable income;
|
•
|
The anticipated reversal or expiration dates of the deferred tax assets; and
|
•
|
Tax planning strategies.
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Numerator for basic net income per share:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
10,924
|
|
|
$
|
20,278
|
|
|
$
|
21,943
|
|
|
$
|
36,335
|
|
Denominator for basic net income per share:
|
|
|
|
|
|
|
|
||||||||
Weighted-average common shares outstanding
|
39,853
|
|
|
37,419
|
|
|
39,838
|
|
|
37,209
|
|
||||
Basic net income per share
|
$
|
0.27
|
|
|
$
|
0.54
|
|
|
$
|
0.55
|
|
|
$
|
0.98
|
|
|
|
|
|
|
|
|
|
||||||||
Numerator for diluted net income per share:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
10,924
|
|
|
$
|
20,278
|
|
|
$
|
21,943
|
|
|
$
|
36,335
|
|
Denominator for diluted net income per share:
|
|
|
|
|
|
|
|
||||||||
Weighted-average common shares outstanding
|
39,853
|
|
|
37,419
|
|
|
39,838
|
|
|
37,209
|
|
||||
Dilutive stock options, restricted stock and performance restricted stock units and employee stock purchase plan shares
|
559
|
|
|
1,194
|
|
|
608
|
|
|
1,305
|
|
||||
Diluted weighted-average common shares outstanding
|
40,412
|
|
|
38,613
|
|
|
40,446
|
|
|
38,514
|
|
||||
Diluted net income per share
|
$
|
0.27
|
|
|
$
|
0.53
|
|
|
$
|
0.54
|
|
|
$
|
0.94
|
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Benefit administration services and COBRA
|
|
$
|
96,258
|
|
|
$
|
99,338
|
|
|
$
|
200,699
|
|
|
$
|
205,923
|
|
Interchange
|
|
13,555
|
|
|
13,915
|
|
|
29,300
|
|
|
28,952
|
|
||||
Other revenue
|
|
6,695
|
|
|
3,879
|
|
|
13,150
|
|
|
8,294
|
|
||||
|
|
$
|
116,508
|
|
|
$
|
117,132
|
|
|
$
|
243,149
|
|
|
$
|
243,169
|
|
|
|
2018
|
|
2019
|
|
2020
|
|
2021 and thereafter
|
|
Total
|
|||||||
|
|
$
|
286
|
|
|
571
|
|
|
571
|
|
|
1,714
|
|
|
$
|
3,142
|
|
|
|
Three Months Ended June 30, 2018
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||||
|
|
As reported
|
|
Adjustments
|
|
Balance without adoption of ASC 606
|
|
As reported
|
|
Adjustments
|
|
Balance without adoption of ASC 606
|
||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Sales and marketing
|
|
$
|
18,521
|
|
|
$
|
245
|
|
|
$
|
18,766
|
|
|
$
|
36,859
|
|
|
$
|
294
|
|
|
$
|
37,153
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total operating expenses
|
|
99,998
|
|
|
245
|
|
|
100,243
|
|
|
211,852
|
|
|
294
|
|
|
212,146
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income from operations
|
|
16,510
|
|
|
(245
|
)
|
|
16,265
|
|
|
31,297
|
|
|
(294
|
)
|
|
31,003
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income before income taxes
|
|
15,545
|
|
|
(245
|
)
|
|
15,300
|
|
|
29,416
|
|
|
(294
|
)
|
|
29,122
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income tax provision
|
|
(4,621
|
)
|
|
73
|
|
|
(4,548
|
)
|
|
(7,473
|
)
|
|
75
|
|
|
(7,398
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
|
$
|
10,924
|
|
|
$
|
(172
|
)
|
|
$
|
10,752
|
|
|
$
|
21,943
|
|
|
$
|
(219
|
)
|
|
$
|
21,724
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
|
$
|
0.27
|
|
|
|
|
$
|
0.27
|
|
|
$
|
0.55
|
|
|
|
|
$
|
0.55
|
|
||||
Diluted
|
|
$
|
0.27
|
|
|
|
|
$
|
0.27
|
|
|
$
|
0.54
|
|
|
|
|
$
|
0.54
|
|
|
|
June 30, 2018
|
||||||||||
|
|
As reported
|
|
Adjustments
|
|
Balance without adoption of ASC 606
|
||||||
Assets
|
|
|
|
|
|
|
||||||
Other assets
|
|
$
|
28,839
|
|
|
$
|
(7,175
|
)
|
|
$
|
21,664
|
|
Total assets
|
|
1,635,960
|
|
|
(7,175
|
)
|
|
1,628,785
|
|
|||
|
|
|
|
|
|
|
||||||
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
||||||
Retained earnings
|
|
101,639
|
|
|
(7,175
|
)
|
|
94,464
|
|
|||
Total Stockholders' equity
|
|
$
|
651,587
|
|
|
(7,175
|
)
|
|
$
|
644,412
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net
|
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net
|
||||||||||||
Amortizable intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Client / broker contracts and relationships
|
$
|
237,431
|
|
|
$
|
(96,695
|
)
|
|
$
|
140,736
|
|
|
$
|
237,221
|
|
|
$
|
(84,581
|
)
|
|
$
|
152,640
|
|
Trade names
|
3,880
|
|
|
(3,540
|
)
|
|
340
|
|
|
3,880
|
|
|
(3,492
|
)
|
|
388
|
|
||||||
Technology
|
14,646
|
|
|
(13,528
|
)
|
|
1,118
|
|
|
14,646
|
|
|
(13,047
|
)
|
|
1,599
|
|
||||||
Noncompete agreements
|
2,232
|
|
|
(2,048
|
)
|
|
184
|
|
|
2,232
|
|
|
(2,013
|
)
|
|
219
|
|
||||||
Favorable lease arrangements
|
1,134
|
|
|
(662
|
)
|
|
472
|
|
|
1,134
|
|
|
(611
|
)
|
|
523
|
|
||||||
Total
|
$
|
259,323
|
|
|
$
|
(116,473
|
)
|
|
$
|
142,850
|
|
|
$
|
259,113
|
|
|
$
|
(103,744
|
)
|
|
$
|
155,369
|
|
|
As of
June 30, 2018 |
||
Remainder of 2018
|
$
|
12,737
|
|
2019
|
24,914
|
|
|
2020
|
22,749
|
|
|
2021
|
19,945
|
|
|
2022
|
17,509
|
|
|
Thereafter
|
44,996
|
|
|
Total
|
$
|
142,850
|
|
|
Carrying Amount
|
|
Gross Unrealized Gain
|
|
Gross Unrealized Loss
|
|
Fair Value
|
|
Level 1
|
|
Level 2
|
||||||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market funds
|
$
|
209
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
209
|
|
|
$
|
209
|
|
|
$
|
—
|
|
Commercial paper
|
20,793
|
|
|
1
|
|
|
(1
|
)
|
|
20,793
|
|
|
—
|
|
|
20,793
|
|
||||||
Total cash equivalents
|
$
|
21,002
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
21,002
|
|
|
$
|
209
|
|
|
$
|
20,793
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-Term Investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government securities
|
$
|
28,970
|
|
|
$
|
—
|
|
|
$
|
(141
|
)
|
|
$
|
28,829
|
|
|
$
|
28,829
|
|
|
$
|
—
|
|
U.S. government agency securities
|
14,325
|
|
|
—
|
|
|
(84
|
)
|
|
14,241
|
|
|
—
|
|
|
14,241
|
|
||||||
Municipal bonds
|
6,981
|
|
|
|
|
(11
|
)
|
|
6,970
|
|
|
—
|
|
|
6,970
|
|
|||||||
Foreign government securities
|
10,505
|
|
|
—
|
|
|
(27
|
)
|
|
10,478
|
|
|
—
|
|
|
10,478
|
|
||||||
Corporate debt securities
|
143,209
|
|
|
35
|
|
|
(910
|
)
|
|
142,334
|
|
|
—
|
|
|
142,334
|
|
||||||
Commercial paper
|
21,661
|
|
|
1
|
|
|
(3
|
)
|
|
21,659
|
|
|
—
|
|
|
21,659
|
|
||||||
Certificates of deposit
|
1,257
|
|
|
1
|
|
|
—
|
|
|
1,258
|
|
|
—
|
|
|
1,258
|
|
||||||
Asset-backed securities
|
31,559
|
|
|
—
|
|
|
(233
|
)
|
|
31,326
|
|
|
—
|
|
|
31,326
|
|
||||||
Total short-term investments
|
$
|
258,467
|
|
|
$
|
37
|
|
|
$
|
(1,409
|
)
|
|
$
|
257,095
|
|
|
$
|
28,829
|
|
|
$
|
228,266
|
|
Total cash equivalents and short-term investments
|
$
|
279,469
|
|
|
$
|
38
|
|
|
$
|
(1,410
|
)
|
|
$
|
278,097
|
|
|
$
|
29,038
|
|
|
$
|
249,059
|
|
|
Carrying Amount
|
|
Gross Unrealized Gain
|
|
Gross Unrealized Loss
|
|
Fair Value
|
|
Level 1
|
|
Level 2
|
||||||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market funds
|
$
|
58,953
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
58,953
|
|
|
$
|
58,953
|
|
|
$
|
—
|
|
Commercial paper
|
21,930
|
|
|
—
|
|
|
(3
|
)
|
|
21,927
|
|
|
—
|
|
|
21,927
|
|
||||||
Total cash equivalents
|
$
|
80,883
|
|
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
80,880
|
|
|
$
|
58,953
|
|
|
$
|
21,927
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-Term Investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government securities
|
$
|
17,472
|
|
|
$
|
—
|
|
|
$
|
(41
|
)
|
|
$
|
17,431
|
|
|
$
|
17,431
|
|
|
$
|
—
|
|
U.S. government agency securities
|
11,540
|
|
|
—
|
|
|
(30
|
)
|
|
11,510
|
|
|
—
|
|
|
11,510
|
|
||||||
Municipal bonds
|
6,974
|
|
|
2
|
|
|
(8
|
)
|
|
6,968
|
|
|
—
|
|
|
6,968
|
|
||||||
Foreign government securities
|
7,499
|
|
|
—
|
|
|
(27
|
)
|
|
7,472
|
|
|
—
|
|
|
7,472
|
|
||||||
Corporate debt securities
|
105,144
|
|
|
3
|
|
|
(273
|
)
|
|
104,874
|
|
|
—
|
|
|
104,874
|
|
||||||
Commercial paper
|
30,798
|
|
|
1
|
|
|
(9
|
)
|
|
30,790
|
|
|
—
|
|
|
30,790
|
|
||||||
Certificates of deposit
|
1,255
|
|
|
—
|
|
|
—
|
|
|
1,255
|
|
|
—
|
|
|
1,255
|
|
||||||
Asset-backed securities
|
15,310
|
|
|
—
|
|
|
(76
|
)
|
|
15,234
|
|
|
—
|
|
|
15,234
|
|
||||||
Total short-term investments
|
$
|
195,992
|
|
|
$
|
6
|
|
|
$
|
(464
|
)
|
|
$
|
195,534
|
|
|
17,431
|
|
|
$
|
178,103
|
|
|
Total cash equivalents and short-term investments
|
$
|
276,875
|
|
|
$
|
6
|
|
|
$
|
(467
|
)
|
|
$
|
276,414
|
|
|
$
|
76,384
|
|
|
$
|
200,030
|
|
|
|
Amortized Cost
|
|
Fair Value
|
||||||||
Due less than one year
|
|
$
|
141,212
|
|
|
$
|
140,904
|
|
||||
Due in one to five years
|
|
138,258
|
|
|
137,194
|
|
||||||
Total
|
|
$
|
279,470
|
|
|
$
|
278,098
|
|
|
|
Amortized Cost
|
|
Fair Value
|
||||||||
Due less than one year
|
|
$
|
157,651
|
|
|
$
|
157,573
|
|
||||
Due in one to five years
|
|
119,224
|
|
|
118,841
|
|
||||||
Total
|
|
$
|
276,875
|
|
|
$
|
276,414
|
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Trade receivables
|
$
|
52,974
|
|
|
$
|
58,067
|
|
Unpaid amounts for benefit services
|
36,835
|
|
|
52,054
|
|
||
Receivables, gross
|
89,809
|
|
|
110,121
|
|
||
Less: allowance for doubtful accounts
|
(2,672
|
)
|
|
(2,574
|
)
|
||
Receivables, net
|
$
|
87,137
|
|
|
$
|
107,547
|
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Computers and equipment
|
$
|
27,496
|
|
|
$
|
22,702
|
|
Software and software development costs
|
132,709
|
|
|
120,278
|
|
||
Furniture and fixtures
|
8,089
|
|
|
7,754
|
|
||
Leasehold improvements
|
28,836
|
|
|
25,097
|
|
||
|
$
|
197,130
|
|
|
$
|
175,831
|
|
Less: accumulated depreciation and amortization
|
(118,644
|
)
|
|
(107,089
|
)
|
||
Property and equipment, net
|
$
|
78,486
|
|
|
$
|
68,742
|
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Payable to benefit providers and transit agencies
|
25,533
|
|
|
32,469
|
|
||
Accounts payable and accrued liabilities
|
21,161
|
|
|
23,788
|
|
||
Accrued compensation and related benefits
|
26,172
|
|
|
25,921
|
|
||
Other accrued expenses
|
5,312
|
|
|
5,275
|
|
||
Deferred revenue
|
10,869
|
|
|
2,524
|
|
||
Accounts payable and accrued expenses
|
$
|
89,047
|
|
|
$
|
89,977
|
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Revolving credit facility used
|
$
|
249,830
|
|
|
$
|
249,830
|
|
Less: Outstanding letters of credit
|
(2,830
|
)
|
|
(2,830
|
)
|
||
Outstanding revolving credit facility
|
247,000
|
|
|
247,000
|
|
||
Unamortized loan origination fees
|
(2,343
|
)
|
|
(2,085
|
)
|
||
Long-term debt
|
$
|
244,657
|
|
|
$
|
244,915
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30, 2018
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cost of revenues
|
$
|
660
|
|
|
$
|
2,007
|
|
|
$
|
2,327
|
|
|
$
|
3,747
|
|
Technology and development
|
586
|
|
|
600
|
|
|
1,161
|
|
|
1,211
|
|
||||
Sales and marketing
|
772
|
|
|
624
|
|
|
1,750
|
|
|
1,410
|
|
||||
General and administrative
|
(430
|
)
|
|
3,802
|
|
|
3,643
|
|
|
4,444
|
|
||||
Total
|
$
|
1,588
|
|
|
$
|
7,033
|
|
|
$
|
8,881
|
|
|
$
|
10,812
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
2018
|
|
2017
|
||||||||
Stock options granted (in thousands)
|
—
|
|
|
27
|
|
—
|
|
|
545
|
|
||||
Weighted-average fair value at date of grant
|
$
|
—
|
|
|
$
|
26.20
|
|
$
|
—
|
|
|
$
|
26.72
|
|
|
Shares
|
|
Weighted-average
exercise price
|
|
Remaining
contractual term
(in years)
|
|
Aggregate
intrinsic value
(in thousands)
|
|||||
Outstanding at December 31, 2017
|
2,478
|
|
|
$
|
47.24
|
|
|
7.22
|
|
$
|
42,324
|
|
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(54
|
)
|
|
26.10
|
|
|
|
|
|
|||
Forfeited and cancelled
|
(28
|
)
|
|
53.94
|
|
|
|
|
|
|||
Outstanding as of June 30, 2018
|
2,396
|
|
|
$
|
47.63
|
|
|
5.43
|
|
$
|
20,948
|
|
Vested and expected to vest at June 30, 2018
|
2,327
|
|
|
$
|
47.27
|
|
|
5.40
|
|
$
|
20,835
|
|
Exercisable at June 30, 2018
|
1,591
|
|
|
$
|
41.35
|
|
|
4.98
|
|
$
|
19,580
|
|
|
(Shares in thousands)
|
Weighted-average grant date fair value
|
|||||||||||
|
Service-
based RSUs
|
|
Performance-
based RSUs
|
|
Service-
based RSUs
|
|
Performance-
based RSUs
|
||||||
Unvested at December 31, 2017
|
304
|
|
|
725
|
|
|
$
|
61.61
|
|
|
$
|
60.21
|
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Vested
|
(57
|
)
|
|
(140
|
)
|
|
62.06
|
|
|
61.10
|
|
||
Forfeited and cancelled
|
(10
|
)
|
|
(210
|
)
|
|
62.94
|
|
|
60.01
|
|
||
Unvested at June 30, 2018
|
237
|
|
|
375
|
|
|
$
|
61.45
|
|
|
$
|
60.00
|
|
|
As of
June 30, 2018 |
||
Remainder of 2018
|
$
|
4,594
|
|
2019
|
9,518
|
|
|
2020
|
9,720
|
|
|
2021
|
9,689
|
|
|
2022
|
6,536
|
|
|
Thereafter
|
7,970
|
|
|
Total future minimum lease payments
|
$
|
48,027
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
|
2018
|
|
2017
|
|
|
|
|
|
2018
|
|
2017
|
|
|
|
|
||||||||||||||
(Dollar in thousands)
|
Amount
|
|
Amount
|
|
$ Change
|
|
% Change
|
|
Amount
|
|
Amount
|
|
$ Change
|
|
% Change
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Healthcare
|
$
|
68,104
|
|
|
$
|
68,202
|
|
|
$
|
(98
|
)
|
|
—
|
%
|
|
$
|
143,361
|
|
|
$
|
142,876
|
|
|
$
|
485
|
|
|
—
|
%
|
COBRA
|
26,200
|
|
|
27,018
|
|
|
(818
|
)
|
|
(3
|
)%
|
|
55,035
|
|
|
55,568
|
|
|
(533
|
)
|
|
(1
|
)%
|
||||||
Commuter
|
18,847
|
|
|
17,836
|
|
|
1,011
|
|
|
6
|
%
|
|
37,725
|
|
|
36,379
|
|
|
1,346
|
|
|
4
|
%
|
||||||
Other
|
3,357
|
|
|
4,076
|
|
|
(719
|
)
|
|
(18
|
)%
|
|
7,028
|
|
|
8,346
|
|
|
(1,318
|
)
|
|
(16
|
)%
|
||||||
Total revenues
|
$
|
116,508
|
|
|
$
|
117,132
|
|
|
$
|
(624
|
)
|
|
(1
|
)%
|
|
$
|
243,149
|
|
|
$
|
243,169
|
|
|
$
|
(20
|
)
|
|
—
|
%
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Cost of revenues (excluding amortization of internal use software)
|
|
$
|
36,143
|
|
|
$
|
43,319
|
|
|
$
|
(7,176
|
)
|
|
(17
|
)%
|
|
$
|
81,386
|
|
|
$
|
91,407
|
|
|
$
|
(10,021
|
)
|
|
(11
|
)%
|
Percentage of revenue
|
|
31
|
%
|
|
37
|
%
|
|
|
|
|
|
33
|
%
|
|
38
|
%
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Technology and development
|
|
$
|
13,392
|
|
|
$
|
14,515
|
|
|
$
|
(1,123
|
)
|
|
(8
|
)%
|
|
$
|
26,425
|
|
|
$
|
29,786
|
|
|
$
|
(3,361
|
)
|
|
(11
|
)%
|
Percentage of revenue
|
|
11
|
%
|
|
12
|
%
|
|
|
|
|
|
11
|
%
|
|
12
|
%
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Sales and marketing
|
|
$
|
18,521
|
|
|
$
|
14,728
|
|
|
$
|
3,793
|
|
|
26
|
%
|
|
$
|
36,859
|
|
|
$
|
30,807
|
|
|
$
|
6,052
|
|
|
20
|
%
|
Percentage of revenue
|
|
16
|
%
|
|
13
|
%
|
|
|
|
|
|
15
|
%
|
|
13
|
%
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
General and administrative
|
|
$
|
18,898
|
|
|
$
|
18,459
|
|
|
$
|
439
|
|
|
2
|
%
|
|
$
|
44,147
|
|
|
$
|
31,959
|
|
|
$
|
12,188
|
|
|
38
|
%
|
Percentage of revenue
|
|
16
|
%
|
|
16
|
%
|
|
|
|
|
|
18
|
%
|
|
13
|
%
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Amortization
|
|
$
|
10,191
|
|
|
$
|
9,393
|
|
|
$
|
798
|
|
|
8
|
%
|
|
$
|
20,182
|
|
|
$
|
18,630
|
|
|
$
|
1,552
|
|
|
8
|
%
|
Percentage of revenue
|
|
9
|
%
|
|
8
|
%
|
|
|
|
|
|
8
|
%
|
|
8
|
%
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Employee termination and other charges
|
|
$
|
2,853
|
|
|
$
|
917
|
|
|
$
|
1,936
|
|
|
211
|
%
|
|
$
|
2,853
|
|
|
$
|
1,648
|
|
|
$
|
1,205
|
|
|
73
|
%
|
Percentage of revenue
|
|
2
|
%
|
|
1
|
%
|
|
|
|
|
|
1
|
%
|
|
1
|
%
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Interest income
|
|
$
|
1,432
|
|
|
$
|
95
|
|
|
$
|
1,337
|
|
|
1,407
|
%
|
|
$
|
2,703
|
|
|
$
|
162
|
|
|
$
|
2,541
|
|
|
1,569
|
%
|
Interest expense
|
|
$
|
(2,420
|
)
|
|
$
|
(1,766
|
)
|
|
$
|
654
|
|
|
37
|
%
|
|
$
|
(4,602
|
)
|
|
$
|
(3,202
|
)
|
|
$
|
1,400
|
|
|
44
|
%
|
Other income (expense), net
|
|
$
|
23
|
|
|
$
|
(9
|
)
|
|
$
|
32
|
|
|
356
|
%
|
|
$
|
18
|
|
|
$
|
(230
|
)
|
|
$
|
248
|
|
|
108
|
%
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
|
||||||||||||||||||
(Dollar in thousands)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Income before income taxes
|
|
$
|
15,545
|
|
|
$
|
14,121
|
|
|
|
|
|
|
$
|
29,416
|
|
|
$
|
35,662
|
|
|
|
|
|
||||||
Income tax (provision) benefit
|
|
$
|
(4,621
|
)
|
|
$
|
6,157
|
|
|
$
|
(10,778
|
)
|
|
(175
|
)%
|
|
$
|
(7,473
|
)
|
|
$
|
673
|
|
|
$
|
(8,146
|
)
|
|
(1,210
|
)%
|
Effective tax rate
|
|
29.7
|
%
|
|
(43.6
|
)%
|
|
|
|
|
|
25.4
|
%
|
|
(1.9
|
)%
|
|
|
|
|
|
Six Months Ended June 30,
|
|
||||||||
(in thousands)
|
2018
|
|
2017
|
$ Change
|
||||||
Net cash provided by (used in) operating activities
|
$
|
13,559
|
|
|
$
|
(8,299
|
)
|
$
|
21,858
|
|
Net cash used in investing activities
|
(82,105
|
)
|
|
(17,931
|
)
|
(64,174
|
)
|
|||
Net cash provided by financing activities
|
1,395
|
|
|
129,754
|
|
(128,359
|
)
|
|||
Net (decrease) increase in cash and cash equivalents, restricted and unrestricted
|
$
|
(67,151
|
)
|
|
$
|
103,524
|
|
$
|
(170,675
|
)
|
(in thousands)
|
Total
|
|
Less than
1 year
|
|
1-3
years
|
|
3-5
years
|
|
More than
5 years
|
||||||||||
Long-term debt obligations
(1)
|
$
|
247,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
247,000
|
|
|
$
|
—
|
|
Interest on long-term debt obligations
(2)
|
33,408
|
|
|
8,760
|
|
|
17,519
|
|
|
7,129
|
|
|
—
|
|
|||||
Operating lease obligations
(3)
|
48,027
|
|
|
9,285
|
|
|
19,470
|
|
|
13,028
|
|
|
6,244
|
|
|||||
Total
|
$
|
328,435
|
|
|
$
|
18,045
|
|
|
$
|
36,989
|
|
|
$
|
267,157
|
|
|
$
|
6,244
|
|
(1)
|
As of
June 30, 2018
, maximum borrowings under the revolving credit facility are
$400.0
million with a base rate determined in accordance with the credit agreement or, at our option, LIBOR plus a spread of 1.25% to 2.25% per annum, and a maturity date of April 4, 2022. As of
June 30, 2018
, our outstanding principal of
$247.0 million
is presented net of debt issuance costs on our condensed consolidated balance sheets. The debt issuance costs are not included in the table above.
|
(2)
|
Estimated interest payments assume the interest rate applicable as of
June 30, 2018
of
3.55%
per annum on a
$247.0 million
outstanding principal amount.
|
(3)
|
We lease facilities under non-cancelable operating leases expiring at various dates through 2028.
|
a)
|
the completion of the Audit Committee’s investigation and the substantial resources expended (including the use of external consultants and experts) to respond to the findings and the resulting restatement of certain of our previously issued financial statements; the Audit Committee engaged independent professionals to assist its investigation throughout the process and, the Audit Committee has concluded its investigation;
|
b)
|
our internal review that identified certain accounting errors and control deficiencies, leading to the restatement of certain of our previously issued financial statements for the quarterly periods ended June 30, 2016, September 30, 2016, financial year ended December 31, 2016, and the quarterly periods ended March 31, 2017, June 30, 2017 and September 30, 2017;
|
c)
|
based on the efforts in (a) and (b) above, we have updated, and in some cases corrected, our accounting policies and have applied these to our previously issued financial results and to our fiscal year 2016 and 2017 financial results; and
|
d)
|
certain remediation actions we have undertaken to address the identified material weaknesses, as discussed below.
|
•
|
We did not have processes and controls to ensure there were adequate mechanisms and oversight to ensure accountability for the performance of internal control over financial reporting responsibilities and to ensure corrective actions were appropriately prioritized and implemented in a timely manner.
|
•
|
We did not effectively execute a strategy to attract, develop and retain a sufficient complement of qualified resources with an appropriate level of knowledge, experience, and training in certain areas important to financial reporting.
|
•
|
There was not an adequate assessment of changes in risks by management that could significantly impact internal control over financial reporting or an adequate determination and prioritization of how those risks should be managed.
|
•
|
We did not have adequate management oversight of accounting and financial reporting activities in implementing certain accounting practices to conform to the Company’s policies and GAAP.
|
•
|
We did not have adequate management oversight around completeness and accuracy of data material to financial reporting.
|
•
|
There was a lack of robust, established and documented accounting policies and insufficiently detailed Company procedures to put these policies into effective action.
|
•
|
We were not focused on a commitment to competency as it relates to creating priorities, allocating adequate resources and establishing cross functional procedures around managing complex contracts and non-routine transactions as well as managing change and attracting, developing and retaining qualified resources.
|
A.
|
Accounting Close and Financial Reporting
|
B.
|
Contract to Cash Process
|
C.
|
Risk Assessment and Management of Change
|
D.
|
Review of New, Unusual or Significant Transactions and Contracts
|
E.
|
Manual Reconciliations of High-Volume Standard Transactions
|
•
|
The Company has undergone a leadership transition, and we have a new CEO, CFO and General Counsel. Clear lines of responsibilities have been drawn in new roles to ensure effective controls.
|
•
|
We are establishing regular working group meetings, with appropriate oversight by the Audit Committee and leadership of the Company, to strengthen accountability for performance of internal control over financial reporting responsibilities and prioritization of corrective actions
.
|
•
|
We will be enhancing our compensation practices to further incorporate risk and operational goals.
|
•
|
We will be assessing and enhancing adequacy and quality of resources in areas impacting financial reporting including, but not limited to conducting additional training programs for our employees to enhance their skill sets which will complement their work.
|
•
|
We are augmenting accounting staff with additional technical expertise in GAAP to assist with enhanced financial reporting procedures, controls and remediation efforts.
|
•
|
We are establishing senior level oversight and executive reporting around the accounting close and financial reporting process with an enhanced focus on improving process level controls to strengthen the existing control environment around formalizing and documenting accounting policies as well as implementing a robust accounting close process with enhanced review of financial statements.
|
•
|
In addition to enhancing processes and controls over adoption of new accounting standards, we will also be enhancing GAAP expertise within the accounting department.
|
•
|
We are establishing senior level oversight and executive reporting around the contract to cash process with an enhanced focus on improving process level controls to strengthen the existing control environment around the contract to cash process and revenue recognition. This includes but is not limited to enhancing the process for record retention of contracts and agreements, assessment of collectability from customers, analysis of complex contracts as well as automation of select billing processes.
|
•
|
We are developing a plan to implement a periodic risk assessment process, review of control procedures and documentation around impact of changes on accounting processes.
|
•
|
We are developing a plan to enhance documentation and review around accounting estimates, and interpretations with formal approval of the detailed review.
|
•
|
We are developing a plan to proactively design manual controls around implementation of new systems impacting financial reporting.
|
•
|
We have reallocated Company resources to improve the oversight over operational changes across the business and business trends.
|
•
|
We are designing and implementing enhanced internal controls surrounding identification, analysis and governance and monitoring of new, significant or unusual contracts or transactions to ensure that these contracts or transactions are recorded in accordance with Company’s policies and GAAP. This will entail enhanced documentation of analysis, as well as review and cross functional approval of company policies and interpretations.
|
•
|
We are providing leadership oversight to ensure prioritization of funding and resources for the remediation efforts.
|
•
|
We are strengthening the review controls and supporting documentation related to reconciliations of high-volume standard transactions. With an enhanced focus on supporting documentation review, we are implementing a comprehensive review methodology over data, inputs and reports used for the reconciliations.
|
|
|
Incorporated by Reference
|
||||
Exhibit No.
|
Exhibit Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
Filed Herewith
|
31.1
|
|
|
|
|
X
|
|
31.2
|
|
|
|
|
X
|
|
32.1
(1)
|
|
|
|
|
X
|
|
10.1
|
8-K
|
001-35232
|
10.1
|
4/21/2017
|
|
|
10.2
|
8-K
|
001-35232
|
10.2
|
4/21/2017
|
|
|
10.10H
|
10-Q
|
001-35232
|
10.10H
|
8/1/2017
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
|
|
|
101.SCH
|
XBRL Taxonomy Schema Linkbase Document
|
|
|
|
|
|
101.CAL
|
XBRL Taxonomy Calculation Linkbase Document
|
|
|
|
|
|
101.DEF
|
XBRL Taxonomy Definition Linkbase Document
|
|
|
|
|
|
101.LAB
|
XBRL Taxonomy Labels Linkbase Document
|
|
|
|
|
|
101.PRE
|
XBRL Taxonomy Presentation Linkbase Document
|
|
|
|
|
|
(1)
|
The certifications attached as Exhibit 32.1 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of WageWorks, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-Q, irrespective of any general incorporation language contained in such filing.
|
|
|
WAGEWORKS, INC.
|
|
|
|
Date: March 18, 2019
|
By:
|
/s/ ISMAIL DAWOOD
|
|
|
Ismail Dawood
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|
1 Year Wageworks Chart |
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