Discontinued Operations

3 Months Ended

Sep. 30, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

NOTE 3. DISCONTINUED OPERATIONS

During the first quarter of fiscal 2016, management approved a plan to dispose of the Company’s digital education business. As a result of the plan and the discontinuation of further significant business activities in the Digital Education segment, the assets and liabilities of this segment were classified as held for sale and the results of operations have been classified as discontinued operations for all periods presented in accordance with ASC 205-20, “Discontinued Operations”.

In the first quarter of fiscal 2016, the Company recognized a pre-tax non-cash impairment charge of $76 million reflecting a write down of the digital education business to its fair value less costs to sell. The impairment charge is included within Loss before income tax benefit in the table below. In addition, the Company recognized a tax benefit of $151 million upon reclassification of the Digital Education segment to discontinued operations. On September 30, 2015, the Company sold the Amplify Insight and Amplify Learning businesses for no material gain or loss.

The following table summarizes the results of operations from the discontinued segment:

	For the three months ended September 30,
	2015			2014
	(in millions)
Revenues	$	26		$	42
Loss before income tax benefit		(122	)		(31	)
Income tax benefit		168			10
Income (loss) from discontinued operations, net of tax	$	46		$	(21	)

The following table summarizes the cash flows from discontinued operations:

	For the three months ended September 30,
	2015			2014
	(in millions)
Net cash used in operating activities	$	(35	)	$	(37	)
Net cash used in investing activities		—			(20	)
Net cash used in financing activities		—			—
Net decrease in cash and cash equivalents	$	(35	)	$	(57	)

Assets and liabilities held for sale related to discontinued operations as of September 30, 2015 and June 30, 2015 are included in Other current assets in the Balance Sheets as follows:

	As of September 30, 2015		As of June 30, 2015
	(in millions)
Current assets	$	61	$	54
Non-current assets		17		100
Total assets	$	78	$	154
Current Liabilities		60		46
Non-current liabilities		13		16
Total liabilities	$	73	$	62
Net assets held for sale	$	5	$	92