Service Alignment Initiative Service Alignment Initiative

3 Months Ended

Sep. 30, 2016

Restructuring and Related Activities [Abstract]

On July 28, 2016, the Company announced a Service Alignment Initiative that is intended to simplify the Company's service organization to align the Company's service operations to its strategic platforms. In addition to improving the client service experience, this initiative is expected to augment the Company's service capabilities by building aligned service capabilities within strategic locations. In fiscal 2016, the Company entered into leases in Norfolk, Virginia and Maitland, Florida, and in October 2016, the Company entered into a lease at a third location, in the Western part of the U.S., as part of this effort. The Company began incurring charges for this initiative in the three months ended September 30, 2016 and expects to continue to incur charges throughout the year ended June 30, 2017 ("fiscal 2017") and the year ended June 30, 2018 ("fiscal 2018") as the initiative is executed. The charges primarily relate to employee separation benefits recognized under Accounting Standards Codification ("ASC") 712, and also include charges for the relocation of certain current Company employees and accelerated depreciation of fixed assets. As the initiative further develops in fiscal 2017 and fiscal 2018, the Company also expects to incur charges related to lease termination costs. The Company expects to recognize pre-tax restructuring charges in the range of $100 million to $125 million through fiscal 2018, consisting primarily of cash expenditures for employee separation benefits in the range of $75 million to $85 million and other one-time costs in the range of $25 million to $40 million.

The table below summarizes the Company's Service Alignment Initiative activity for fiscal 2017:



	Employee separation benefits (a)		Other one time costs (b)			Total
Balance at June 30, 2016	$	—	$	—		$	—
Charged to expense (c)	37.3		2.6			39.9
Cash payments	—		(0.6		)	(0.6		)
Non-cash utilization	—		(1.4		)	(1.4		)
Balance at September 30, 2016	$	37.3	$	0.6		$	37.9

(a) - Charges are recorded in selling, general and administrative expenses on the Statements of Consolidated Earnings.

(b) - Other one time costs include costs to relocate certain current Company employees to new locations (included within selling, general and administrative expenses on the Statements of Consolidated Earnings) and accelerated depreciation on fixed assets (included within depreciation and amortization on the Statements of Consolidated Earnings).