Automatic Data Processing Inc. (ADP)

Common-Size Income Statement

Difficulty: Beginner

Automatic Data Processing Inc., common-size consolidated income statement

	12 months ended	Jun 30, 2019		Jun 30, 2018		Jun 30, 2017		Jun 30, 2016		Jun 30, 2015		Jun 30, 2014
	Revenues, other than interest on funds held for clients and PEO revenues
	Interest on funds held for clients
	Professional Employer Organization (PEO) revenues
	Revenues
	Operating expenses
	Systems development and programming costs
	Depreciation and amortization
	Costs of revenues
	Gross profit
	Selling, general, and administrative expenses
	Separation costs
	Operating income
	Interest expense
	Interest income on corporate funds
	Realized gains on available-for-sale securities
	Realized losses on available-for-sale securities
	Impairment of intangible assets
	Gain on sale of assets
	Gain on sale of investment
	Gain on sale of business
	Gain on sale of notes receivable
	Non-service components of pension expense, net
	Other, net
	Other income (expense), net
	Earnings from continuing operations before income taxes
	Provision for income taxes
	Net earnings from continuing operations
	Net earnings (loss) from discontinued operations
	Net earnings

Income statement item	Description	The company
Operating income	The net result for the period of deducting operating expenses from operating revenues.	Automatic Data Processing Inc.’s operating income as a percentage of revenues increased from 2017 to 2018 and from 2018 to 2019.
Earnings from continuing operations before income taxes	Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.	Automatic Data Processing Inc.’s earnings from continuing operations before income taxes as a percentage of revenues declined from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.
Net earnings	The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.	Automatic Data Processing Inc.’s net earnings as a percentage of revenues declined from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.

	Automatic Data Processing Inc.	Other companies (not purchased previously)
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Relative Valuation
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Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis
Financial Reporting Quality