0001558370-21-010711 | 10-K | XBRL Viewer

Document and Entity Information - USD ($) $ in Billions	12 Months Ended
Document and Entity Information - USD ($) $ in Billions	Jun. 30, 2021	Jul. 30, 2021	Dec. 31, 2020
Document and Entity Information
Document Type	10-K
Document Annual Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Entity File Number	001-36348
Entity Registrant Name	PAYLOCITY HOLDING CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-4066644
Entity Address, Address Line One	1400 American Lane
Entity Address, City or Town	Schaumburg
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60173
City Area Code	847
Local Phone Number	463-3200
Title of 12(b) Security	Common Stock, par value $0.001 per share
ICFR Auditor Attestation Flag	true
Trading Symbol	PCTY
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 7.8
Entity Common Stock, Shares Outstanding		54,601,434
Entity Central Index Key	0001591698
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	FY
Amendment Flag	false

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020
Current assets:
Cash and cash equivalents	$ 202,287	$ 250,851
Corporate investments	4,456	34,556
Accounts receivable, net	6,267	4,923
Deferred contract costs	44,230	32,332
Prepaid expenses and other	15,966	13,188
Total current assets before funds held for clients	273,206	335,850
Funds held for clients	1,759,677	1,327,304
Total current assets	2,032,883	1,663,154
Capitalized internal-use software, net	45,018	36,501
Property and equipment, net	59,835	66,737
Operating lease right-of-use assets	43,984	48,658
Intangible assets, net	13,027	13,360
Goodwill	33,650	21,655
Long-term deferred contract costs	170,663	125,711
Long-term prepaid expenses and other	4,223	4,917
Deferred income tax assets	11,602	4,955
Total assets	2,414,885	1,985,648
Current liabilities:
Accounts payable	4,230	1,755
Accrued expenses	103,109	79,881
Total current liabilities before client fund obligations	107,339	81,636
Client fund obligations	1,759,677	1,327,304
Total current liabilities	1,867,016	1,408,940
Long-term debt		100,000
Long-term operating lease liabilities	67,201	73,299
Other long-term liabilities	1,958	1,747
Deferred income tax liabilities	1,780	8,754
Total liabilities	1,937,955	1,592,740
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000 authorized, no shares issued and outstanding at June 30, 2020 and June 30, 2021
Common stock, $0.001 par value, 155,000 shares authorized at June 30, 2020 and June 30, 2021; 53,792 shares issued and outstanding at June 30, 2020 and 54,594 shares issued and outstanding at June 30, 2021	55	54
Additional paid-in capital	241,718	227,907
Retained earnings	235,091	164,272
Accumulated other comprehensive income	66	675
Total stockholders' equity	476,930	392,908
Total liabilities and stockholders' equity	$ 2,414,885	$ 1,985,648

Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Jun. 30, 2021	Jun. 30, 2020
Consolidated Balance Sheets
Preferred Stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred Stock, shares authorized	5,000	5,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Common Stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common Stock, shares authorized	155,000	155,000
Common Stock, shares issued	54,594	53,792
Common Stock, shares outstanding	54,594	53,792

Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Revenues:
Recurring and other revenue	$ 631,725	$ 546,212	$ 447,752
Interest income on funds held for clients	3,902	15,117	19,881
Total revenues	635,627	561,329	467,633
Cost of revenues	219,298	182,010	153,851
Gross profit	416,329	379,319	313,782
Operating expenses:
Sales and marketing	161,808	145,134	112,599
Research and development	76,707	62,766	50,329
General and administrative	119,771	105,248	94,630
Total operating expenses	358,286	313,148	257,558
Operating income	58,043	66,171	56,224
Other income (expense)	(939)	947	1,822
Income before income taxes	57,104	67,118	58,046
Income tax expense (benefit)	(13,715)	2,663	4,223
Net income	70,819	64,455	53,823
Other comprehensive income (loss), net of tax	(609)	563	251
Comprehensive income	$ 70,210	$ 65,018	$ 54,074
Net income per share:
Basic (in dollars per share)	$ 1.30	$ 1.20	$ 1.02
Diluted (in dollars per share)	$ 1.26	$ 1.15	$ 0.97
Weighted-average shares used in computing net income per share:
Basic (in shares)	54,318	53,547	52,914
Diluted (in shares)	56,305	55,807	55,414

Consolidated Statement of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-in Capital	Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjustment [Member]	Retained Earnings (Accumulated Deficit)	Accumulated Other Comprehensive Income (Loss)	Cumulative Effect, Period of Adoption, Adjustment [Member]	Total
Balance at Jun. 30, 2018	$ 53	$ 219,588		$ (6,678)	$ (139)		$ 212,824
Balance (in shares) at Jun. 30, 2018	52,758
Increase (Decrease) in Stockholders' Equity
Stock-based compensation		41,525					41,525
Stock options exercised		4,882					4,882
Stock options exercised (in shares)	378
Issuance of common stock upon vesting of restricted stock units (in shares)	660
Issuance of common stock under employee stock purchase plan		5,982					5,982
Issuance of common stock under employee stock purchase plan (in shares)	116
Net settlement for taxes and/or exercise price related to equity awards		(29,004)					(29,004)
Net settlement for taxes and/or exercise price related to equity awards (in shares)	(395)
Repurchases of common shares		(34,991)					(34,991)
Repurchases of common shares (in shares)	(442)
Unrealized gains (losses) on securities, net of tax					251		251
Net income				53,823			53,823
Balance at Jun. 30, 2019	$ 53	207,982	$ 52,672	99,817	112	$ 52,672	307,964
Balance (in shares) at Jun. 30, 2019	53,075
Increase (Decrease) in Stockholders' Equity
Stock-based compensation		49,890					49,890
Stock options exercised		3,079					3,079
Stock options exercised (in shares)	270
Issuance of common stock upon vesting of restricted stock units	$ 1	(1)
Issuance of common stock upon vesting of restricted stock units (in shares)	735
Issuance of common stock under employee stock purchase plan		8,901					8,901
Issuance of common stock under employee stock purchase plan (in shares)	97
Net settlement for taxes and/or exercise price related to equity awards		(41,944)					(41,944)
Net settlement for taxes and/or exercise price related to equity awards (in shares)	(385)
Unrealized gains (losses) on securities, net of tax					563		563
Net income				64,455			64,455
Balance at Jun. 30, 2020	$ 54	227,907		164,272	675		$ 392,908
Balance (in shares) at Jun. 30, 2020	53,792						53,792
Increase (Decrease) in Stockholders' Equity
Stock-based compensation		65,662					$ 65,662
Stock options exercised		3,313					3,313
Stock options exercised (in shares)	490
Issuance of common stock upon vesting of restricted stock units	$ 1	(1)
Issuance of common stock upon vesting of restricted stock units (in shares)	644
Issuance of common stock under employee stock purchase plan		12,214					12,214
Issuance of common stock under employee stock purchase plan (in shares)	104
Net settlement for taxes and/or exercise price related to equity awards		(67,377)					(67,377)
Net settlement for taxes and/or exercise price related to equity awards (in shares)	(436)
Unrealized gains (losses) on securities, net of tax					(609)		(609)
Net income				70,819			70,819
Balance at Jun. 30, 2021	$ 55	$ 241,718		$ 235,091	$ 66		$ 476,930
Balance (in shares) at Jun. 30, 2021	54,594						54,594

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Cash flows from operating activities:
Net income	$ 70,819	$ 64,455	$ 53,823
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation expense	63,052	47,493	38,765
Depreciation and amortization expense	42,972	37,913	34,564
Deferred income tax expense (benefit)	(13,642)	2,754	4,134
Provision for credit losses	316	309	283
Net accretion of discounts and amortization of premiums on available-for-sale securities	347	(1,836)	(2,230)
Amortization of debt issuance costs	171	154
Other	632	395	454
Changes in operating assets and liabilities:
Accounts receivable	(1,654)	(732)	(1,188)
Deferred contract costs	(56,850)	(54,944)	(34,992)
Prepaid expenses and other	(4,004)	(196)	389
Accounts payable	2,394	(806)	(75)
Accrued expenses and other	20,297	17,696	13,625
Tenant improvement allowance			7,480
Net cash provided by operating activities	124,850	112,655	115,032
Cash flows from investing activities:
Purchases of available-for-sale securities and other		(400,343)	(250,685)
Proceeds from sales and maturities of available-for-sale securities	101,467	410,593	246,243
Capitalized internal-use software costs	(28,594)	(25,715)	(20,142)
Purchases of property and equipment	(9,461)	(16,578)	(11,280)
Lease allowances used for tenant improvements			(7,480)
Acquisition of business, net of cash acquired	(14,992)	(16,714)
Net cash provided by (used in) investing activities	48,420	(48,757)	(43,344)
Cash flows from financing activities:
Net change in client fund obligations	432,373	(67,165)	168,855
Borrowings under credit facility		100,000
Repayment of credit facility	(100,000)
Payment of contingent consideration			(1,000)
Repurchases of common shares			(34,991)
Proceeds from exercise of stock options	146		85
Proceeds from employee stock purchase plan	12,214	8,901	5,982
Taxes paid related to net share settlement of equity awards	(64,191)	(38,943)	(24,207)
Payment of debt issuance costs	(64)	(701)
Net cash provided by financing activities	280,478	2,092	114,724
Net change in cash, cash equivalents and funds held for clients' cash and cash equivalents	453,748	65,990	186,412
Cash, cash equivalents and funds held for clients' cash and cash equivalents-beginning of year	1,492,133	1,426,143	1,239,731
Cash, cash equivalents and funds held for clients' cash and cash equivalents-end of year	1,945,881	1,492,133	1,426,143
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Build-out allowances received from landlords			1,264
Purchases of property and equipment and internal-use software, accrued but not paid	581	164	4,260
Liabilities assumed for acquisition	281	674
Supplemental Disclosure of Cash Flow Information
Cash paid for interest	870	438
Cash paid (refunds received) for income taxes	(136)	84	412
Reconciliation of cash, cash equivalents and funds held for clients' cash and cash equivalents to the Consolidated Balance Sheets
Cash and cash equivalents	202,287	250,851	132,476
Funds held for clients' cash and cash equivalents	1,743,594	1,241,282	1,293,667
Total cash, cash equivalents and funds held for clients' cash and cash equivalents	$ 1,945,881	$ 1,492,133	$ 1,426,143

Organization and Description of Business

12 Months Ended

Jun. 30, 2021

Organization and Description of Business

Organization and Description of Business

(1) Organization and Description of Business

Paylocity Holding Corporation (the “Company”) is a cloud-based provider of payroll and human capital management software solutions. Services are provided in a Software-as-a-Service (“SaaS”) delivery model utilizing the Company’s cloud-based platform. The Company’s comprehensive product suite, comprised of payroll, human capital management, workforce management, talent management, benefits, modern workforce solutions and analytics & insights, delivers a unified platform that allows clients to make strategic decisions while promoting a modern workplace and improving employee engagement.

Summary of Significant Accounting Policies

12 Months Ended

Jun. 30, 2021

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

(2) Summary of Significant Accounting Policies

(a) Basis of Presentation, Consolidation, and Use of Estimates

The accompanying consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”).

The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Future events and their effects cannot be predicted with certainty; accordingly, accounting estimates require the exercise of judgment. Accounting estimates used in the preparation of these consolidated financial statements change as new events occur, as more experience is acquired, as additional information is obtained and as the operating environment changes.

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Beginning in fiscal 2020, the Company simplified the presentation of revenue and cost of revenues on its Consolidated Statements of Operations and Comprehensive Income. The line items “Recurring fees” and “Implementation services and other” have been combined into one revenue line: “Recurring and other revenue”. Likewise, the line items “Cost of revenues - recurring revenues” and “Cost of revenues - implementation services and other” have been combined into one line: “Cost of revenues”. The Company changed the presentation of revenue and cost of revenues as Implementation services and other has become a smaller component of its overall revenue mix due to the human capital management (“HCM”) suite becoming a larger part of the portfolio. Previously reported results for the year ended June 30, 2019 have been reclassified to conform to the current presentation.

(b) Concentrations of Risk

The Company regularly maintains cash balances that exceed Federal Depository Insurance Corporation limits. No individual client represents 10% or more of total revenues. For all periods presented, substantially all of total revenues were generated by clients in the United States.

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

(d) Funds Held For Clients, Corporate Investments and Client Fund Obligations

The Company obtains funds from clients in advance of performing payroll and payroll tax filing services on behalf of those clients. Funds held for clients represent assets that are used solely for the purposes of satisfying the obligations to remit funds relating to payroll and payroll tax filing services. The Company has classified Funds held for

clients as a current asset since these funds are held solely for the purposes of satisfying the client fund obligations. Funds held for clients is primarily comprised of cash and cash equivalents invested in demand deposit accounts. The Company also invests a portion of its funds held for clients and corporate funds in marketable securities.

Marketable securities classified as available-for-sale are recorded at fair value on the Consolidated Balance Sheets. Unrealized gains and losses, net of applicable income taxes, are reported as Other comprehensive income (loss) in the Consolidated Statements of Operations and Comprehensive Income. Interest on marketable securities included in Funds held for clients is reported as Interest income on funds held for clients and interest on Corporate investments is reported as Other income on the Consolidated Statements of Operations and Comprehensive income, respectively.

The Company evaluates whether a decline in an individual security’s fair value as compared to its amortized cost basis resulted from credit loss or other factors by comparing the present value of cash flows expected to be collected from the impaired security with its amortized cost basis. If the security’s amortized cost basis exceeds the present value of expected cash flows, the Company records credit impairment loss through an allowance for credit loss. The Company did not recognize any credit impairment losses during the years ended June 30, 2019, 2020 or 2021.

Client fund obligations represent the Company’s contractual obligations to remit funds to satisfy clients’ payroll and tax payment obligations and are recorded in the accompanying balance sheets at the time that the Company obtains funds from clients. The client fund obligations represent liabilities that will be repaid within one year of the balance sheet date.

(e) Accounts Receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest. Amounts collected on trade accounts receivable are included in Net cash provided by operating activities in the Consolidated Statements of Cash Flows. The Company maintains an allowance for credit losses reflecting expected credit losses in its accounts receivable portfolio. In establishing the required allowance, management considers historical losses adjusted to take into account current market conditions and the Company’s clients’ financial conditions, the amount of receivables in dispute, the current receivables aging and current payment patterns. The Company reviews its allowance for credit losses quarterly. Past due balances over 60 days and over a specified amount are reviewed individually for collectability. All other balances are reviewed on a pooled basis. Account balances are charged off against the allowance after all commercially reasonable means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its clients.

Activity in the allowance for credit losses related to accounts receivable was as follows:


	For the Years Ended June 30,
	2019		2020		2021
Balance at the beginning of the year	$	375	$	473	$	617
Charged to expense		283		309		316
Write-offs		(185)		(165)		(133)
Balance at the end of the year	$	473	$	617	$	800

(f) Deferred Contract Costs

The Company defers certain selling and commission costs that meet the capitalization criteria under ASC 340-40. The Company also capitalizes certain costs to fulfill a contract related to its proprietary products if they are identifiable, generate or enhance resources used to satisfy future performance obligations and are expected to be recovered under ASC 340-40. Implementation fees are treated as nonrefundable upfront fees and the related implementation costs are required to be capitalized and amortized over the expected period of benefit, which is the period in which the Company expects to recover the costs and enhance its ability to satisfy future performance obligations.

The Company utilizes the portfolio approach to account for both the cost of obtaining a contract and the cost of fulfilling a contract. These capitalized costs are amortized over the expected period of benefit, which has been determined to be over 7 years based on the Company’s average client life and other qualitative factors, including rate of technological changes. The Company does not incur any additional costs to obtain or fulfill contracts upon renewal. The

Company recognizes additional selling and commission costs and fulfillment costs when an existing client purchases additional services. These additional costs only relate to the additional services purchased and do not relate to the renewal of previous services.

(g) Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist primarily of prepaid licensing fees, prepaid insurance premiums, deposits with vendors and time clocks available for sale or lease.

(h) Capitalized Internal-Use Software

The Company applies Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 350-40, Intangibles—Goodwill and Other—Internal-Use Software, to the accounting for costs of internal-use software. Internal-use software costs are capitalized when module development begins, it is probable that the project will be completed, and the software will be used as intended. Costs associated with preliminary project stage activities, training, maintenance and all other post implementation stage activities are expensed as incurred. The Company also capitalizes certain costs related to specific upgrades and enhancements when it is probable the expenditures will result in significant additional functionality. The capitalization policy provides for the capitalization of certain payroll costs for employees who are directly associated with developing internal-use software as well as certain external direct costs, such as consulting fees. Capitalized employee costs are limited to the time directly spent on such projects.

Capitalized internal-use software costs are amortized on a straight-line basis over the estimated useful lives, generally over a 24 or 36-month period. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets.

(i) Property and Equipment and Long-Lived Assets

Property and equipment are stated at cost. Depreciation on property and equipment is calculated on the straight-line method over the estimated useful lives of the assets, generally three to seven years for most classes of assets, or over the term of the related lease for leasehold improvements.

Long-lived assets, such as property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company first compares the undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary.

(j) Intangible Assets, Net of Accumulated Amortization

Intangible assets are comprised primarily of acquired client relationships, proprietary technology, trade name and non-solicitation agreements and are reported net of accumulated amortization on the Consolidated Balance Sheets. Client relationships use the straight-line method of amortization over a five to nine-year time frame from the date of acquisition, while proprietary technology and trade name use the straight-line method of amortization over a five-year period from the date of acquisition. Non-solicitation agreements use the straight-line method of amortization over the term of the related agreements. The Company tests intangible assets for potential impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable.

(k) Goodwill

Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Goodwill is not amortized, but instead is tested for impairment at the reporting unit level. If the fair value of the reporting unit is less than its carrying amount, the Company would record an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, but the loss recognized should not exceed the amount of goodwill allocated to the reporting unit.

The Company performs its annual impairment review of goodwill in its fiscal fourth quarter or when a triggering event occurs between annual impairment tests. No impairment was recorded in fiscal 2019, 2020 or 2021 as a result of the Company’s qualitative assessments over its single reporting segment.

(l) Leases

The Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) (“Topic 842”), effective July 1, 2019. The Company determines if an arrangement is a lease at agreement inception. Operating leases are included in Operating lease right-of-use assets, Accrued expenses, and Long-term operating lease liabilities in the Consolidated Balance Sheets. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date. The operating lease right-of-use assets also include any lease payments made at or before the commencement date and are reduced by any lease incentives received. The Company’s lease terms may include options to renew or extend a lease. The Company recognizes amounts in Operating lease right-of-use assets and Operating lease liabilities when it is reasonably certain it will exercise such options. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense is recognized on a straight-line basis over the expected lease term.

The Company’s most significant leases are real estate leases of office space. The remaining operating leases are primarily comprised of leases of printers and other equipment. For all leases, the Company has elected the practical expedient permitted under Topic 842 to combine lease and non-lease components. As a result, non-lease components, such as common area or equipment maintenance charges, are accounted for as a single lease element. The Company does not have any material finance leases.

Fixed lease expense payments are recognized on a straight-line basis over the lease term. Variable lease payments vary because of changes in facts or circumstances occurring after the commencement date, other than the passage of time, and are often due to changes in an external market rate or the value of an index (e.g. Consumer Price Index). Certain of the Company’s operating lease agreements include variable payments that are passed through by the landlord, such as insurance, taxes, and common area maintenance, payments based on the usage of the asset, and rental payments adjusted periodically for inflation. Variable payments are expensed as incurred and included within variable rent expense.

The Company’s lease agreements do not contain material residual value guarantees, restrictions, or covenants.

(m) Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Deferred tax assets may be reduced by a valuation allowance to the extent we determine it is more likely than not that some portion or all of the deferred tax assets will not be realized. Management judgment is required in determining the period in which the reversal of a valuation allowance should occur. The Company is required to consider all available evidence, both positive and negative, such as historical levels of income and future forecasts of taxable income among other items, in determining whether a full or partial release of its valuation allowance is required. The Company is also required to schedule future taxable income in accordance with accounting standards that address income taxes to assess the appropriateness of a valuation allowance, which further requires the exercise of significant management judgment. The Company’s accounting for deferred tax consequences represents the best estimate of those future events.

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. When applicable, the Company records interest and penalties as an element of income tax expense.

Refer to Note 13 for additional information on income taxes.

(n) Revenue Recognition

The Company applies Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“Topic 606”). Topic 606 requires revenue to be recognized when an entity transfers control of goods or services to a customer in an amount that reflects the consideration to which a company also expects to be entitled to for those goods or services. To achieve this core principle, the Company recognizes revenue from contracts with customers based on the following five steps:

Identify the contract with a customer;

Identify the performance obligations in the contract;

Determine the transaction price;

Allocate the transaction price to performance obligations in the contract; and

Recognize revenue when or as the Company satisfies a performance obligation.

The Company derives its revenue from contracts predominantly from recurring and non-recurring service fees. While the majority of its agreements are generally cancellable by the client on 60 days’ notice or less, the Company offers term agreements to its clients, which are generally two years in length. Recurring fees are derived from payroll, timekeeping, and HR-related cloud-based computing services as follows:

●

Payroll processing and related services, including payroll reporting and tax filing services are delivered on a weekly, biweekly, semi-monthly, or monthly basis depending upon the payroll frequency of the client and on an annual basis if a client selects W-2 preparation and processing services,

●

Time and attendance reporting services, including time clock rentals, are delivered on a monthly basis, and

●

Cloud-based HR software solutions, including employee administration and benefits enrollment and administration, are delivered on a monthly basis.

The majority of the Company’s recurring fees are satisfied over time as services are provided. The performance obligations related to payroll services are satisfied upon the processing of the client’s payroll with the fee charged and collected based on a per employee per payroll frequency fee. The performance obligations related to time and attendance services and HR related services are satisfied over time each month with the fee charged and collected based on a per employee per month fee. For subscription-based fees which can include payroll, time and attendance, and HR related services, the Company recognizes the applicable recurring fees over time each month with the fee charged and collected based on a per employee per month fee.

The Company has certain optional performance obligations that are satisfied at a point in time including the sales of time clocks and W-2 services.

Non-recurring service fees consist mainly of nonrefundable implementation fees, which involve setting the client up in, and loading data into, the Company’s cloud-based modules. These implementation activities are considered set-up activities. The Company has determined that the nonrefundable upfront fees provide certain clients with a material right to renew the contract. Implementation fees are deferred and amortized generally over a period up to 24 months.

Sales taxes collected from clients and remitted to governmental authorities where applicable are accounted for on a net basis and therefore are excluded from revenues in the Statements of Operations and Comprehensive Income.

Interest income earned on funds held for clients is recognized in Interest income on funds held for clients when earned as the collection, holding and remittance of these funds are components of providing services to clients.

(o) Cost of Revenues

Cost of revenues consists primarily of costs to provide payroll and HCM solutions relating to the provision of ongoing client support and implementation activities and also includes amortization of capitalized internal-use software. The Company generally expenses these costs when incurred except for costs related to the implementation of the Company’s proprietary products. These costs are capitalized and amortized over a period of 7 years.

(p) Advertising

Advertising costs are expensed as incurred. Advertising costs amounted to $283, $1,023 and $3,189 for the June 30, 2019, 2020 and 2021, respectively.

(q) Stock-Based Compensation

The Company recognizes all employee stock-based compensation as a cost in the financial statements. Equity-classified awards, including those under the 2014 Employee Stock Purchase Plan (“ESPP”), are measured at the grant date fair value of the award and expense is recognized, net of assumed forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. For market share units, the Company estimates grant date fair value using a discrete model based on multiple stock price-paths developed through the use of Monte Carlo simulation. For estimated shares purchasable under the ESPP, the Company estimates grant date fair value using the Black-Scholes option-pricing model. The Company periodically updates the assumed forfeiture rates for actual experience over award vesting term.

(r) Commitments and Contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred.

(s) Segment Information

The Company’s chief operating decision maker reviews the financial results of the Company in total when evaluating financial performance and for purposes of allocating resources. The Company has thus determined that it operates in a single reporting segment.

(t) Recently Adopted Accounting Standards

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use (“ROU”) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement.

The Company adopted the new standard on July 1, 2019 using the modified retrospective method and the transition relief guidance provided by the FASB in ASU 2018-11, Leases (Topic 842): Targeted Improvements. Consequently, the Company did not update financial information or provide disclosures required under the new standard for dates and periods prior to July 1, 2019. The Company elected the package of practical expedients and did not reassess prior conclusions on whether contracts are or contain a lease, lease classification, and initial direct costs. In addition, the Company adopted the lessee practical expedient to combine lease and non-lease components for all asset classes and elected to not recognize ROU assets and lease liabilities for leases with a term of 12 months or less.

Adoption of the new standard resulted in the Company recording operating lease ROU assets and operating lease liabilities of $52,083 and $83,852, respectively, as of July 1, 2019. The ROU assets were recorded net of $31,769 in deferred rent adjustments that were previously recorded in Accrued expenses and Deferred rent on the Consolidated Balance Sheets as of June 30, 2019. The adoption of this standard did not result in any cumulative-effect adjustments to Retained earnings. Additionally, there was no impact on the Company’s Consolidated Statements of Operations and Comprehensive Income or the Consolidated Statements of Cash Flows as a result of the adoption of

Topic 842 for the year ended June 30, 2019. Refer to Note 2(l) and Note 12 for additional disclosures over the Company’s leases.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial instruments held at amortized cost, including trade receivables. Under ASU 2016-13, the Company assesses its allowance for credit losses on accounts receivable by taking into consideration current economic conditions, reasonable and supportable forecasts, as well as past experience including historical write-off trends and client-specific circumstances. The new standard also eliminated the concept of other-than-temporary impairment and requires expected credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. The Company adopted this standard effective July 1, 2020, using a modified retrospective approach, and the adoption did not have a material impact on the Company’s financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which amends the requirements for fair value measurement disclosures. ASU 2018-13 removes, modifies or adds certain disclosure requirements under GAAP. The Company adopted this standard on July 1, 2020, and removed or modified disclosure requirements retrospectively to all periods presented, whereas any new requirements are being applied prospectively from the adoption date. The adoption of this standard did not have a material impact on the Company’s financial statements.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”) which provides guidance to reduce complexity in certain areas of accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and simplifies various aspects of the current guidance to promote consistent application of the standard among reporting entities. The Company adopted ASU 2019-12 on July 1, 2020, and the adoption of this standard did not have a material impact on the Company’s financial statements.

(u) Recently Issued Accounting Standards

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of other recently issued standards that are not yet effective will not have a material impact on the Company’s consolidated financial statements upon adoption.

Revenue

12 Months Ended

Jun. 30, 2021

Revenue

Revenue

(3) Revenue

The following table disaggregates revenue by Recurring fees and Implementation services and other, which the Company believes depicts the nature, amount and timing of its revenue:


	Year Ended
	June 30,
	2019		2020		2021
Recurring fees	$	436,955	$	526,267	$	609,658
Implementation services and other		10,797		19,945		22,067
Total revenues from contracts	$	447,752	$	546,212	$	631,725

Deferred revenue

The timing of revenue recognition for recurring revenue is consistent with the timing of invoicing as they occur simultaneously upon the client payroll-processing period or by month. As such, the Company does not recognize contract assets or liabilities related to recurring revenue.

The nonrefundable upfront fees related to implementation services are invoiced with the client’s first payroll period. The Company defers and amortizes these nonrefundable upfront fees generally over a period up to 24 months based on the type of contract. The following table summarizes the changes in deferred revenue (i.e. contract liability) related to these nonrefundable upfront fees as follows:


	Year Ended
	June 30,
	2020		2021
Balance at beginning of the year	$	6,289	$	8,434
Deferral of revenue		15,998		16,106
Revenue recognized		(13,853)		(15,806)
Balance at end of the year	$	8,434	$	8,734

Deferred revenue related to these nonrefundable upfront fees are recorded within accrued expenses and other long-term liabilities on the consolidated balance sheets. The Company expects to recognize these deferred revenue balances of $7,068 in fiscal 2022, $1,600 in fiscal 2023, and $66 thereafter.

Deferred contract costs

The following tables present the deferred contract costs balances and the related amortization expense for these deferred contract costs:


	Year Ended June 30, 2020
	Beginning		Capitalized				Ending
	Balance		Costs		Amortization		Balance
Costs to obtain a new contract	$	82,103	$	53,529	$	(22,057)	$	113,575
Costs to fulfill a contract		20,996		28,893		(5,421)		44,468
Total	$	103,099	$	82,422	$	(27,478)	$	158,043


	Year Ended June 30, 2021
	Beginning		Capitalized				Ending
	Balance		Costs		Amortization		Balance
Costs to obtain a new contract	$	113,575	$	60,833	$	(28,690)	$	145,718
Costs to fulfill a contract		44,468		34,574		(9,867)		69,175
Total	$	158,043	$	95,407	$	(38,557)	$	214,893

Deferred contract costs are recorded within Deferred contract costs and Long-term deferred contract costs on the Consolidated Balance Sheets. Amortization of deferred contract costs is recorded in Cost of revenues, Sales and marketing, and General and administrative in the Consolidated Statements of Operations and Comprehensive Income. The Company did not record any impairment losses associated with its deferred contract costs during the years ended June 30, 2019, 2020 or 2021.

Remaining Performance Obligations

The Company has applied the practical expedients as allowed under Topic 606 and elects not to disclose the value of unsatisfied performance obligations for contracts that have an original expected duration of one year or less and contracts for which the variable consideration is allocated entirely to wholly unsatisfied performance obligations. The Company’s remaining performance obligations related to minimum monthly fees on its term-based contracts was approximately $47,854 as of June 30, 2021, which will be generally recognized over the next 24 months.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

Corporate Investments and Funds Held for Clients

12 Months Ended

Jun. 30, 2021

Corporate Investments and Funds Held for Clients

Corporate Investments and Funds Held for Clients

(4) Corporate Investments and Funds Held for Clients

Corporate investments and funds held for clients consist of the following:


	June 30, 2020
			Gross		Gross
	Amortized		unrealized		unrealized
Type of Issue	cost		gains		losses		Fair value
Cash and cash equivalents	$	250,851	$	—	$	—	$	250,851
Funds held for clients' cash and cash equivalents		1,241,282		—		—		1,241,282
Available-for-sale securities:
Commercial paper		6,643		6		—		6,649
Corporate bonds		44,343		414		—		44,757
Asset-backed securities		49,978		424		—		50,402
U.S. treasury securities		21,302		67		—		21,369
Total available-for-sale securities (1)		122,266		911		—		123,177
Total investments	$	1,614,399	$	911	$	—	$	1,615,310

(1)

Included within the fair value of total available-for-sale securities above is $37,155 of Corporate investments and $86,022 of Funds held for clients.


	June 30, 2021
			Gross		Gross
	Amortized		unrealized		unrealized
Type of Issue	cost		gains		losses		Fair value
Cash and cash equivalents	$	202,287	$	—	$	—	$	202,287
Funds held for clients' cash and cash equivalents		1,743,594		—		—		1,743,594
Available-for-sale securities:
Corporate bonds		13,390		70		—		13,460
Asset-backed securities		7,062		17		—		7,079
Total available-for-sale securities (2)		20,452		87		—		20,539
Total investments	$	1,966,333	$	87	$	—	$	1,966,420

(2)

Included within the fair value of total available-for-sale securities above is $4,456 of Corporate investments and $16,083 of Funds held for clients.

Cash and cash equivalents and funds held for clients’ cash and cash equivalents included demand deposit accounts and money market funds as of June 30, 2020 and 2021. All of the Company’s available-for-sale securities had expected maturities of one year or less at June 30, 2021.

Classification of investments on the consolidated balance sheets is as follows:


	June 30,		June 30,
	2020		2021
Cash and cash equivalents	$	250,851	$	202,287
Corporate investments		34,556		4,456
Funds held for clients		1,327,304		1,759,677
Long-term prepaid expenses and other		2,599		—
Total investments	$	1,615,310	$	1,966,420

There were no available-for sale securities in an unrealized loss position as of June 30, 2020 or 2021. The Company regularly reviews the composition of its portfolio to determine the existence of credit impairment. The Company did not recognize any credit impairment losses during the years ended June 30, 2019, 2020 or 2021. All securities in the Company's portfolio held an A- rating or better as of June 30, 2021.

The Company did not make any material reclassification adjustments out of Accumulated other comprehensive income for realized gains and losses on the sale of available-for-sale securities during the years ended June 30, 2019,

2020 or 2021. Gross realized gains and losses on the sale of available-for-sale securities were immaterial for the years ended June 30, 2019, 2020 and 2021.

Fair Value Measurement

12 Months Ended

Jun. 30, 2021

Fair Value Measurement

Fair Value Measurement

(5) Fair Value Measurement

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

●

Level 1—Quoted prices in active markets for identical assets and liabilities.

●

Level 2—Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

●

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The Company measures any cash and cash equivalents, accounts receivable, accounts payable and client fund obligations at fair value on a recurring basis using Level 1 inputs. The Company considers the recorded value of these financial assets and liabilities to approximate the fair value of the respective assets and liabilities at June 30, 2020 and 2021 based upon the short-term nature of these assets and liabilities.

Marketable securities, consisting of securities classified as available-for-sale as well as certain cash equivalents, are recorded at fair value on a recurring basis using Level 2 inputs obtained from an independent pricing service. Available-for-sale securities include commercial paper, corporate bonds, asset-backed securities and U.S. treasury securities. The independent pricing service utilizes a variety of inputs including benchmark yields, broker/dealer quoted prices, reported trades, issuer spreads as well as other available market data. The Company, on a sample basis, validates the pricing from the independent pricing service against another third-party pricing source for reasonableness. The Company has not adjusted any prices obtained by the independent pricing service, as it believes they are appropriately valued. There were no available-for-sale securities classified in Level 3 of the fair value hierarchy at June 30, 2020 or 2021.

The fair value level for the Company’s cash and cash equivalents and available-for-sale securities is as follows:


	June 30, 2020
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	250,851	$	250,851	$	—	$	—
Funds held for clients' cash and cash equivalents		1,241,282		1,241,282		—		—
Available-for-sale securities:
Commercial paper		6,649		—		6,649		—
Corporate bonds		44,757		—		44,757		—
Asset-backed securities		50,402		—		50,402		—
U.S. treasury securities		21,369		—		21,369		—
Total available-for-sale securities		123,177		—		123,177		—
Total investments	$	1,615,310	$	1,492,133	$	123,177	$	—


	June 30, 2021
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	202,287	$	202,287	$	—	$	—
Funds held for clients' cash and cash equivalents		1,743,594		1,743,594		—		—
Available-for-sale securities:
Corporate bonds		13,460		—		13,460		—
Asset-backed securities		7,079		—		7,079		—
Total available-for-sale securities		20,539		—		20,539		—
Total investments	$	1,966,420	$	1,945,881	$	20,539	$	—

The Company determined that the carrying value of long-term debt under its revolving credit facility approximated fair value, which was classified as Level 2 as of June 30, 2020, because interest rates associated with the borrowings reflected market rates.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Business Combinations

12 Months Ended

Jun. 30, 2021

Business Combinations

Business Combinations

(6) Business Combinations

The Company accounts for business combinations in accordance with ASC 805, Business Combinations. The Company recorded the acquisitions disclosed below using the acquisition method of accounting and recognized assets and liabilities at their fair values as of the date of acquisitions, with the excess recorded to goodwill.

In April 2020, the Company acquired all of the shares outstanding of VidGrid, Inc. (“VidGrid”) through a merger for purchase price consideration of $17,256, which was paid in cash upon closing. VidGrid, Inc. is a leading video platform provider that enables peer-to-peer video learning courses, transforming video into two-way communication. This transaction expands the Company’s product functionality around workplace video communication and reaffirms its commitment to stronger employee collaboration, engagement and retention while helping clients prepare for the workplaces of the future. The allocation of the purchase price for VidGrid is approximately $12,065 of goodwill, $2,962 of proprietary technology and other immaterial assets and liabilities.

In November 2020, the Company acquired all of the shares outstanding of Samepage Labs Inc. (“Samepage”) through a merger for purchase price consideration of $15,018, which was paid in cash upon closing. Samepage offers digital collaboration tools including task management, file sharing, real-time collaboration and more. This transaction expands the Company’s product functionality in these areas and demonstrates its commitment to building a modern workforce suite of solutions that meet the needs of HR teams and employees. The allocation of the purchase price for Samepage is approximately $11,995 of goodwill, $3,167 of proprietary technology and other immaterial assets and liabilities.

The results from these acquisitions have been included in the Company’s consolidated financial statements since the closing of the acquisitions. Pro forma information was not presented because the effect of the acquisitions was not material to the Company’s consolidated financial statements. The goodwill associated with these acquisitions is not deductible for income tax purposes. Direct costs related to the acquisition were recorded as General and administrative expenses as incurred.

Capitalized Internal-Use Software

12 Months Ended

Jun. 30, 2021

Capitalized Internal-Use Software.

Capitalized Internal-Use Software

(7) Capitalized Internal-Use Software

Capitalized internal-use software and accumulated amortization were as follows:


	Year ended June 30,
	2020		2021
Capitalized internal-use software	$	119,178	$	150,922
Accumulated amortization		(82,677)		(105,904)
Capitalized internal-use software, net	$	36,501	$	45,018

Amortization of capitalized internal-use software amounted to $16,921, $19,261 and $23,227 for the June 30, 2019, 2020 and 2021, respectively and is included in Cost of revenues.

Property and Equipment

12 Months Ended

Jun. 30, 2021

Property and Equipment.

Property and Equipment

(8) Property and Equipment

The major classes of property and equipment are as follows as of June 30:


	Year ended June 30,
	2020		2021
Office equipment	$	4,619	$	5,211
Computer equipment		42,936		45,420
Furniture and fixtures		12,723		13,104
Software		6,609		6,641
Leasehold improvements		46,192		46,814
Time clocks rented by clients		4,967		5,399
Total		118,046		122,589
Accumulated depreciation		(51,309)		(62,754)
Property and equipment, net	$	66,737	$	59,835

Depreciation expense amounted to $15,392, $16,129 and $15,905 for the June 30, 2019, 2020 and 2021, respectively.

Goodwill and Intangible Assets

12 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets

Goodwill and Intangible Assets

(9) Goodwill and Intangible Assets

The following table summarizes changes in goodwill during the years presented below:


	Year ended June 30,
	2020		2021
Balance at beginning of year	$	9,590	$	21,655
Additions attributable to acquisitions		12,065		11,995
Balance at end of year	$	21,655	$	33,650

Refer to Note 6 for further details on the acquisitions during the years ended June 30, 2020 and 2021.

The Company’s amortizable intangible assets and estimated useful lives are as follows:


					Weighted
					average
	Year ended June 30,				useful
	2020		2021		life (years)
Client relationships	$	19,200	$	19,200	8.2
Proprietary technology		2,962		6,129	5.0
Non-solicitation agreements		1,350		1,600	3.1
Trade name		350		440	5.0
Total		23,862		27,369
Accumulated amortization		(10,502)		(14,342)
Intangible assets, net	$	13,360	$	13,027

Amortization expense for acquired intangible assets was $2,251, $2,523 and $3,840 for the June 30, 2019, 2020 and 2021, respectively. Future amortization expense for acquired intangible assets is as follows, as of June 30, 2021:


Fiscal 2022	$	4,093
Fiscal 2023		3,919
Fiscal 2024		2,914
Fiscal 2025		1,860
Fiscal 2026		241
Total	$	13,027

Accrued Expenses

12 Months Ended

Jun. 30, 2021

Accrued Expenses

Accrued Expenses

(10) Accrued Expenses

The components of accrued expenses are as follows:


	Year ended June 30,
	2020		2021
Accrued payroll and personnel costs	$	53,284	$	73,969
Operating lease liabilities		8,083		7,549
Deferred revenue		8,777		9,442
Other		9,737		12,149
Total accrued expenses	$	79,881	$	103,109

Debt

12 Months Ended

Jun. 30, 2021

Debt

Debt

(11) Debt

In July 2019, the Company entered into a five-year revolving credit agreement with PNC Bank, National Association, and other lenders, which is secured by substantially all of the Company’s assets, subject to certain restrictions. The revolving credit agreement provides for a senior secured revolving credit facility (the “credit facility”) under which the Company may borrow up to $250,000, which may be increased to up to $375,000, subject to obtaining additional lender commitments and certain approvals and satisfying other requirements. The credit facility is scheduled to expire in July 2024, and any borrowings outstanding will mature and be payable upon such expiration. In April 2020, the Company borrowed $100,000 under the credit facility, which the Company repaid during the third quarter of fiscal 2021. The Company incurred interest expense related to this borrowing at an average interest rate of 1.04%.

The proceeds of any borrowings are to be used to fund working capital, capital expenditures and general corporate purposes, including permitted acquisitions, permitted investments, permitted distributions and share repurchases. The Company may generally borrow, prepay and reborrow under the credit facility and terminate or reduce the lenders’ commitments at any time prior to revolving credit facility expiration without a premium or a penalty, other than customary “breakage” costs with respect to London Interbank Offered Rate (“LIBOR”) revolving loans.

Any borrowings under the credit facility generally bear interest, at the Company’s option, at a rate per annum determined by reference to either the LIBOR (or a replacement index for the LIBOR rate) or an adjusted base rate, in each case plus an applicable margin ranging from 0.875% to 1.375% and 0.0% to 0.375%, respectively, based on the then-applicable net senior secured leverage ratio. Additionally, the Company is required to pay certain commitment, letter of credit fronting and letter of credit participation fees on available and/or undrawn portions of the credit facility.

Under the credit facility, the Company is required to comply with certain customary affirmative and negative covenants, including a requirement to maintain a maximum net total leverage ratio of not greater than 4.00 to 1.00, a maximum net senior secured leverage ratio of not greater than 3.50 to 1.00 and a minimum interest coverage ratio of not less than 3.00 to 1.00. As of June 30, 2021, the Company was in compliance with all of the aforementioned covenants.

Leases

12 Months Ended

Jun. 30, 2021

Leases

Leases

(12) Leases

The Company primarily leases office space under non-cancellable operating leases expiring on various dates from July 2021 through October 2032. The leases provide for increasing annual base rents and oblige the Company to fund its proportionate share of operating expenses and, in certain cases, real estate taxes. The Company also leases various types of office and production related equipment under non-cancellable operating leases expiring on various dates from November 2021 through July 2024.

The components of operating lease expense were as follows:


	Year ended June 30,
	2020		2021
Operating lease cost	$	9,686	$	9,139
Short-term lease cost		40		75
Variable lease cost		3,167		4,796
Total lease costs	$	12,893	$	14,010

The classification of the Company’s operating lease right-of-use assets, operating lease liabilities and other supplemental information related to the Company’s operating leases are as follows:


	Year ended June 30,
	2020			2021
Operating lease right-of-use assets	$	48,658		$	43,984
Accrued expenses	$	8,083		$	7,549
Long-term operating lease liabilities	$	73,299		$	67,201
Weighted-average remaining lease term (years)		10.3			9.6
Weighted-average discount rate		3.83	%		3.83	%

The following table summarizes supplemental cash flow information related to the Company’s operating leases:


	Year ended June 30,
	2020		2021
Cash paid for amounts included in the measurement of operating lease liabilities	$	10,374	$	11,093
Operating lease assets obtained in exchange for new liabilities	$	3,123	$	1,682

The undiscounted cash flows for future maturities of the Company’s operating lease liabilities and the reconciliation to the balance of operating lease liabilities reflected on the Company’s balance sheet are as follows as of June 30, 2021:


Fiscal 2022	$	10,192
Fiscal 2023		9,798
Fiscal 2024		9,594
Fiscal 2025		9,392
Fiscal 2026		9,067
Thereafter		41,965
Total undiscounted cash flows		90,008
Less: Present value discount		(15,258)
Total operating lease liabilities	$	74,750

As of June 30, 2021, the Company had not entered into any leases that had not yet commenced.

Income Taxes

12 Months Ended

Jun. 30, 2021

Income Taxes

Income Taxes

(13) Income Taxes

(a) Income Taxes

Income tax expense (benefit) for the June 30, 2019, 2020 and 2021 consists of the following:


	Year ended June 30,
	2019		2020		2021
Current taxes
U.S. federal	$	—	$	—	$	—
State and local		90		(92)		(75)
Deferred taxes:
U.S. federal		5,449		403		(10,476)
State and local		(1,316)		2,352		(3,164)
Total income tax expense (benefit)	$	4,223	$	2,663	$	(13,715)

(b) Tax Rate Reconciliation

Income tax expense (benefit) differed from the amounts computed by applying the U.S. federal income tax rate of 21% for the years ended June 30, 2019, 2020 and 2021 to pretax income as a result of the following:


	Year ended June 30,
	2019			2020			2021
Income tax expense (benefit) at statutory federal rate		21.0	%		21.0	%		21.0	%
Increase (reduction) in income taxes resulting from:
Research and development credit and other credits		(3.0)			(3.2)			(7.1)
Non-deductible expenses		1.3			1.6			1.4
Change in valuation allowance		0.3			5.2			2.8
Stock-based compensation expense		(10.4)			(18.3)			(35.0)
State and local income taxes, net of federal income tax benefit		(2.0)			(1.8)			(6.7)
Other		0.1			(0.5)			(0.4)
		7.3	%		4.0	%		(24.0)	%

The effective tax rate for the years ended June 30, 2019, 2020 and 2021 was 7.3%, 4.0% and (24.0)%, respectively, on pre-tax income of $58,046, $67,118 and $57,104, respectively. The decrease in the effective tax rate is primarily due to increased deductions related to stock compensation and research and development credits, partially offset by an increase to the valuation allowance.

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at June 30, 2020 and 2021 are presented below.


	Year ended June 30,
	2020		2021
Deferred tax assets:
Operating lease liabilities	$	21,041	$	19,415
Accrued expenses		9,915		13,559
Stock-based compensation		13,351		15,835
Net operating loss carryforwards		13,596		32,812
Federal and state tax credits		16,714		23,105
Other		—		179
Total deferred tax assets		74,617		104,905
Valuation allowance		(3,967)		(5,584)
Net deferred tax assets		70,650		99,321
Deferred tax liabilities:
Deferred contract costs		(41,229)		(56,618)
Operating lease right-of-use assets		(12,607)		(11,460)
Research and development costs		(8,563)		(10,664)
Intangible assets		(781)		(994)
Depreciation		(11,269)		(9,763)
Total deferred tax liabilities		(74,449)		(89,499)
Net deferred tax asset (liability)	$	(3,799)	$	9,822

On March 11, 2021, the President signed the American Rescue Plan Act, 2021 into law. The bill complements the provisions set forth in the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and the Consolidated Appropriations Act, 2021, which were signed into law on March 27, 2020, and December 27, 2020, respectively. The provisions of the legislation do not have a significant impact on the Company’s income taxes.

As of June 30, 2021, the Company maintains a valuation allowance of $5,584 for certain state tax benefits which may not be realized. Such assessment may change in the future as further evidence becomes available.

At June 30, 2021, the Company has gross net operating loss carryforwards for federal income tax purposes of approximately $129,406, of which $37,525 expire between 2034 to 2038. The Company has gross net operating loss carryforwards for state income tax purposes of approximately $98,721, of which $73,751 expire from 2021 to 2040. The remaining $116,851 federal and state net operating loss carryforwards have an indefinite utilization period. The Company also has gross federal and state research and development tax credits and other state credit carryforwards of approximately $23,639, which expire between 2022 and 2041.

As of June 30, 2021, the Company’s liabilities for unrecognized tax benefits, which would impact the Company’s effective tax rate if recognized, are presented below. The Company will include applicable penalties and interest when the benefit is recognized:


		Year ended June 30,
	2021
Unrecognized tax benefits at beginning of the year	$	—
Additions for tax positions		84
Additions for tax positions of prior periods		450
Unrecognized tax benefit at end of year	$	534

The Company files income tax returns with the United States federal government and various state jurisdictions. Certain tax years remain open for federal and state tax reporting jurisdictions in which the Company does business due to net operating loss carryforwards and tax credits unutilized from such years or utilized in a period remaining open for audit under normal statute of limitations relating to income tax liabilities. The Company, including its domestic subsidiaries, files a consolidated federal income tax return. For years before fiscal year ended June 30, 2018, the Company is no longer subject to U.S. federal examination; however, the Internal Revenue Service (IRS) has the ability to review years prior to fiscal year 2018 to the extent the Company utilized tax attributes carried forward from those prior years. The statute of limitations on state filings is generally three to four years.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

Stockholders' Equity

12 Months Ended

Jun. 30, 2021

Stockholders' Equity

Stockholders' Equity

(14) Stockholders’ Equity

Common Stock

Holders of common stock are entitled to one vote per share and to receive dividends, when declared. The holders have no preemptive or other subscription rights and there are no redemption or sinking fund provisions with respect to such shares.

Benefit Plans

12 Months Ended

Jun. 30, 2021

Benefit Plans

Benefit Plans

(15) Benefit Plans

(a) Equity Incentive Plans

The Company maintains a 2008 Equity Incentive Plan (the “2008 Plan”) and a 2014 Equity Incentive Plan (the “2014 Plan”) pursuant to which the Company has reserved shares of its common stock for issuance to its employees, directors and non-employee third parties. The 2014 Plan serves as the successor to the 2008 Plan and permits the granting of restricted stock units and other equity incentives at the discretion of the compensation committee of the Company’s board of directors (“the Committee”). No new awards have been or will be issued under the 2008 Plan since the effective date of the 2014 Plan. Outstanding awards under the 2008 Plan continue to be subject to the terms and conditions of the 2008 Plan. The number of shares of common stock reserved for issuance under the 2014 Plan may increase each calendar year, continuing through and including January 1, 2024. The number of shares added each year may be equal to the lesser of (a) four and five tenths percent (4.5%) of the number of shares of common stock of the Company issued and outstanding on the immediately preceding December 31, or (b) an amount determined by the Company’s board of directors. The Company’s board of directors approved the increase in the number of common shares in reserve for issuance under the 2014 Plan by 1,000 shares, effective January 1, 2021.

As of June 30, 2021, the Company had 12,523 shares allocated to the plans, of which 2,211 shares were subject to outstanding options or awards. Generally, the Company issues previously unissued shares for the exercise of stock options or vesting of awards; however, shares previously subject to 2014 Plan grants or awards that are forfeited or net settled at exercise or release may be reissued to satisfy future issuances.

The following table summarizes the changes in the number of shares available for grant under the Company’s equity incentive plans during the year ended June 30, 2021:


		Number of Shares
Available for grant at July 1, 2020		9,519
January 1, 2021 Evergreen provision increase		1,000
RSUs granted		(494)
MSUs granted		(58)
Shares withheld in settlement of taxes and/or exercise price		436
Forfeitures		88
Shares removed		(179)
Available for grant at June 30, 2021		10,312

Shares removed represents forfeitures of shares and shares withheld in settlement of taxes and/or payment of exercise price related to grants made under the 2008 Plan. As noted above, no new awards will be issued under the 2008 Plan.

Stock-based compensation expense related to stock options, restricted stock units (“RSUs”), market share units (“MSUs”) and the Employee Stock Purchase Plan (as described below) is included in the following line items in the accompanying Consolidated Statements of Operations and Comprehensive Income:


	Year ended June 30,
	2019		2020		2021
Cost of revenues	$	5,027	$	5,637	$	7,687
Sales and marketing		7,631		13,960		15,658
Research and development		5,325		7,182		10,192
General and administrative		20,782		20,714		29,515
Total stock-based compensation expense	$	38,765	$	47,493	$	63,052

In addition, the Company capitalized $2,760, $2,397 and $2,610 of stock-based compensation expense in its capitalized internal-use software costs in the years ended June 30, 2019, 2020 and 2021, respectively.

In August 2020, the Company’s board of directors approved the Company’s fiscal 2021 annual operating plan to reflect the operating and financial impacts of the COVID-19 pandemic. In connection and alignment with the board’s approval of the updated operating plan, the Committee approved the modification of the performance targets for vesting of the performance-based restricted stock units granted in fiscal 2020 to certain executives. The Company recorded $6,423 during the year ended June 30, 2021 related to these modified performance-based restricted stock units.

Stock option activity during the periods indicated is as follows:


	Outstanding Options
				Weighted
		Weighted		average
		average		remaining	Aggregate
	Number of	exercise		contractual	intrinsic
	shares	price		term (years)	value
Balance at July 1, 2020	1,255	$	12.43	3.0	$	167,406
Options exercised	(490)	$	6.76
Balance at June 30, 2021	765	$	16.06	2.4	$	133,550
Options vested and exercisable at June 30, 2021	765	$	16.06	2.4	$	133,550

There were no stock options granted during the years ended June 30, 2019, 2020 or 2021. The total intrinsic value of options exercised during the years ended June 30, 2019, 2020 and 2021 was $24,920, $29,791 and $84,072, respectively.

The Company may also grant RSUs under the 2014 Plan with terms determined at the discretion of the Committee. RSUs generally vest over three or four years following the grant date. Certain RSU awards have time-based

vesting conditions while other RSUs vest based on the achievement of certain revenue and Adjusted EBITDA targets in current and future fiscal years. For these performance-based RSUs, the Company recognizes stock-based compensation expense based upon the probable achievement of these aforementioned performance metrics. The following table represents restricted stock unit activity during the year ended June 30, 2021:


	Units	Weighted average grant date fair value
RSU balance at July 1, 2020	1,626	$	73.96
RSUs granted	494	$	135.17
RSUs vested	(644)	$	65.46
RSUs forfeited	(88)	$	91.46
RSU balance at June 30, 2021	1,388	$	100.33
RSUs expected to vest at June 30, 2021	1,314	$	99.53

At June 30, 2021, there was $55,289 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested restricted stock units granted. That cost is expected to be recognized over a weighted average period of 1.8 years.

The Company also grants MSUs under the 2014 Plan with terms determined at the discretion of the Committee. In August 2020, the Company granted approximately 58 MSUs with a grant date fair value of $178.04. The actual number of MSUs that will be eligible to vest is based on the achievement of a relative total shareholder return (“TSR”) target as compared to the TSR realized by each of the companies comprising the Russell 3000 Index over an approximately three-year period. The MSUs cliff-vest at the end of the TSR measurement period, and up to 200% of the target number of shares subject to each MSU are eligible to be earned.

The Company estimated the grant date fair value of the MSUs using a Monte Carlo simulation model that included the following assumptions:


Expected dividend yield	0	%
Expected volatility	52.0	%
Expected term (years)	3.04
Risk‑free interest rate	0.18	%

At June 30, 2021, there was $6,608 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested MSUs. That cost is expected to be recognized over a period of 2.2 years.

The total of excess income tax benefits for stock-based compensation arrangements was $41,195, $67,816 and $128,229 for the years ended June 30, 2019, 2020 and 2021, respectively, and were recognized through Income tax expense (benefit).

(b) Employee Stock Purchase Plan

Under the Company’s Employee Stock Purchase Plan (“ESPP”), the Company can grant stock purchase rights to all eligible employees during specific offering periods not to exceed twenty-seven months. Each offering period will begin on the trading day closest to May 16 and November 16 of each year. Shares are purchased through employees’ payroll deductions, up to a maximum of 10% of employees’ compensation for each purchase period, at a purchase price equal to 85% of the lesser of the fair market value of the Company’s common stock at the first trading day of the applicable offering period or the purchase date. Participants may purchase up to $25 worth of common stock or 2 shares of common stock in any one year. The ESPP is considered compensatory and results in compensation expense.

As of June 30, 2021, a total of 1,194 shares of common stock were reserved for future issuances under the ESPP. The number of shares of common stock reserved for issuance under the ESPP may increase each calendar year, continuing through and including January 1, 2024. The number of shares added each year may be equal to the lesser of (a) 400, (b) seventy-five one hundredths percent (0.75%) of the number of shares of common stock of the Company issued and outstanding on the immediately preceding December 31, or (c) an amount determined by the Company’s

board of directors. The Company’s board of directors approved the increase in the number of common shares in reserve for issuance under the ESPP by 400 shares, effective January 1, 2021.

The Company issued a total of 104 shares upon the completion of its six-month offering periods ending November 13, 2020 and May 14, 2021. The Company recorded compensation expense attributable to the ESPP of $1,949, $3,235 and $4,570 for the years ended June 30, 2019, 2020 and 2021, respectively, which is included in the summary of stock-based compensation expense above. The grant date fair value of the ESPP offering periods was estimated using the following weighted average assumptions:



	Year ended June 30,
	2019		2020		2021
Valuation assumptions:
Expected dividend yield	0	%	0	%	0	%
Expected volatility	33.5 - 38.6	%	38.6 - 72.2	%	42.2 - 72.2	%
Expected term (years)	0.5		0.5		0.5
Risk‑free interest rate	2.10 - 2.48	%	0.15 - 2.44	%	0.04 - 0.15	%

The Company maintains a 401(k) plan with a matching provision that covers all eligible employees. The Company matches 50% of employees’ contributions up to 8% of their gross pay. Contributions were $5,693, $7,914 and $2,658 for the years ended June 30, 2019, 2020 and 2021, respectively. In response to the uncertainties presented by the COVID-19 pandemic, the Company temporarily suspended 401(k) plan matching contributions during the first three quarters of fiscal 2021. The Company reinstated contributions during the fourth quarter of fiscal 2021.

Commitments and Contingencies

12 Months Ended

Jun. 30, 2021

Commitments And Contingencies

Commitments and Contingencies

(16) Commitments and Contingencies

(a) Employment Agreements

The Company has employment agreements with certain of its key officers. The agreements allow for annual compensation increases, participation in equity incentive plans and bonuses for annual performance as well as certain change of control events as defined in the agreements.

(b) Litigation

On July 12, 2019, a former employee filed a class and collective action complaint under federal and state law alleging that certain employees of the Company were misclassified as salaried exempt employees. The complaint sought unpaid overtime and other damages. The Company reached an agreement, without admitting any liability or wrongdoing, to settle this matter. The settlement of this claim did not have a material impact to the Company’s financial position, results of operations, or liquidity.

On November 16, 2020, a potential class action complaint was filed against the Company with the Circuit Court of Cook County alleging that the Company violated the Illinois Biometric Information Privacy Act. The complaint seeks statutory damages, attorney’s fees and other costs. This claim is still in its earliest stages and the Company is unable to estimate any reasonably possible loss, or range of loss, with respect to this matter. The Company intends to vigorously defend against this lawsuit.

From time to time, the Company is subject to litigation arising in the ordinary course of business. Many of these matters are covered in whole or in part by insurance. In the opinion of the Company’s management, the ultimate disposition of any matters currently outstanding or threatened will not have a material adverse effect on the Company’s financial position, results of operations, or liquidity. However, these matters are subject to inherent uncertainties and could materially impact the Company’s financial position, results of operations, or liquidity based on the final disposition of these matters.

Net Income Per Share

12 Months Ended

Jun. 30, 2021

Net Income Per Share

Net Income Per Share

(17) Net Income Per Share

Basic net income per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted-average number of common shares outstanding during the period and, if dilutive, potential common shares outstanding during the period. The Company’s potential common shares consist of the incremental common shares issuable upon the exercise of stock options, the release of restricted stock units and market share units and the shares purchasable via the employee stock purchase plan as of the balance sheet date.

The following table presents the calculation of basic and diluted net income per share:


	Year ended June 30,
	2019		2020		2021
Numerator:
Net income	$	53,823	$	64,455	$	70,819

Denominator:
Weighted-average shares used in computing net income per share:
Basic		52,914		53,547		54,318
Weighted-average effect of potentially dilutive shares:
Employee stock options, restricted stock units, market share units and employee stock purchase plan shares		2,500		2,260		1,987
Diluted		55,414		55,807		56,305

Net income per share:
Basic	$	1.02	$	1.20	$	1.30
Diluted	$	0.97	$	1.15	$	1.26

The following table summarizes the outstanding restricted stock units, market share units and employee stock purchase plan shares as of the balance sheet date that were excluded from the diluted per share calculation for the periods presented because to include them would have been anti-dilutive:


	Year ended June 30,
	2019	2020	2021
Market share units	—	—	38
Restricted stock units	69	23	6
Employee stock purchase plan shares	13	—	—
Total	82	23	44

In August 2018, the Company announced that its board of directors approved a program to repurchase up to $35,000 of the Company’s common stock, with authorization through August 14, 2019. During the first quarter of fiscal 2019, the Company completed the repurchase program and repurchased 442 shares for $34,991. All shares of common stock repurchased were retired.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Jun. 30, 2021

Summary of Significant Accounting Policies

Basis of Presentation, Consolidation, and Use of Estimates

(a) Basis of Presentation, Consolidation, and Use of Estimates

The accompanying consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”).

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Concentrations of Risk

(b) Concentrations of Risk

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Funds Held For Clients, Corporate Investments and Client Fund Obligations

(d) Funds Held For Clients, Corporate Investments and Client Fund Obligations

Accounts Receivable

(e) Accounts Receivable

Activity in the allowance for credit losses related to accounts receivable was as follows:


	For the Years Ended June 30,
	2019		2020		2021
Balance at the beginning of the year	$	375	$	473	$	617
Charged to expense		283		309		316
Write-offs		(185)		(165)		(133)
Balance at the end of the year	$	473	$	617	$	800

Deferred Contract Costs

(f) Deferred Contract Costs

Prepaid Expenses and Other Assets

(g) Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist primarily of prepaid licensing fees, prepaid insurance premiums, deposits with vendors and time clocks available for sale or lease.

Capitalized Internal-Use Software

(h) Capitalized Internal-Use Software

Property and Equipment and Long-Lived Assets

(i) Property and Equipment and Long-Lived Assets

Intangible Assets, Net of Accumulated Amortization

(j) Intangible Assets, Net of Accumulated Amortization

Goodwill

(k) Goodwill

Leases

(l) Leases

The Company’s lease agreements do not contain material residual value guarantees, restrictions, or covenants.

Income Taxes

(m) Income Taxes

Refer to Note 13 for additional information on income taxes.

Revenue Recognition

(n) Revenue Recognition

Identify the contract with a customer;

Identify the performance obligations in the contract;

Determine the transaction price;

Allocate the transaction price to performance obligations in the contract; and

Recognize revenue when or as the Company satisfies a performance obligation.

●

Time and attendance reporting services, including time clock rentals, are delivered on a monthly basis, and

●

Cloud-based HR software solutions, including employee administration and benefits enrollment and administration, are delivered on a monthly basis.

The Company has certain optional performance obligations that are satisfied at a point in time including the sales of time clocks and W-2 services.

Cost of Revenues

(o) Cost of Revenues

Advertising

(p) Advertising

Advertising costs are expensed as incurred. Advertising costs amounted to $283, $1,023 and $3,189 for the June 30, 2019, 2020 and 2021, respectively.

Stock-Based Compensation

(q) Stock-Based Compensation

Commitments and Contingencies

(r) Commitments and Contingencies

Segment Information

(s) Segment Information

Recently Adopted Accounting Standards

(t) Recently Adopted Accounting Standards

Topic 842 for the year ended June 30, 2019. Refer to Note 2(l) and Note 12 for additional disclosures over the Company’s leases.

Recently Issued Accounting Standards

(u) Recently Issued Accounting Standards

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Jun. 30, 2021

Summary of Significant Accounting Policies

Schedule of activity in the allowance for credit losses related to accounts receivable


	For the Years Ended June 30,
	2019		2020		2021
Balance at the beginning of the year	$	375	$	473	$	617
Charged to expense		283		309		316
Write-offs		(185)		(165)		(133)
Balance at the end of the year	$	473	$	617	$	800

Revenue (Tables)

12 Months Ended

Jun. 30, 2021

Revenue

Schedule of disaggregation of revenue


	Year Ended
	June 30,
	2019		2020		2021
Recurring fees	$	436,955	$	526,267	$	609,658
Implementation services and other		10,797		19,945		22,067
Total revenues from contracts	$	447,752	$	546,212	$	631,725

Schedule of changes in deferred revenue related to nonrefundable upfront fees


	Year Ended
	June 30,
	2020		2021
Balance at beginning of the year	$	6,289	$	8,434
Deferral of revenue		15,998		16,106
Revenue recognized		(13,853)		(15,806)
Balance at end of the year	$	8,434	$	8,734

Schedule of deferred contract costs and the related amortization expense


	Year Ended June 30, 2020
	Beginning		Capitalized				Ending
	Balance		Costs		Amortization		Balance
Costs to obtain a new contract	$	82,103	$	53,529	$	(22,057)	$	113,575
Costs to fulfill a contract		20,996		28,893		(5,421)		44,468
Total	$	103,099	$	82,422	$	(27,478)	$	158,043


	Year Ended June 30, 2021
	Beginning		Capitalized				Ending
	Balance		Costs		Amortization		Balance
Costs to obtain a new contract	$	113,575	$	60,833	$	(28,690)	$	145,718
Costs to fulfill a contract		44,468		34,574		(9,867)		69,175
Total	$	158,043	$	95,407	$	(38,557)	$	214,893

Corporate Investments and Funds Held For Clients (Tables)

12 Months Ended

Jun. 30, 2021

Corporate Investments and Funds Held for Clients

Schedule of corporate investments and funds held for clients


	June 30, 2020
			Gross		Gross
	Amortized		unrealized		unrealized
Type of Issue	cost		gains		losses		Fair value
Cash and cash equivalents	$	250,851	$	—	$	—	$	250,851
Funds held for clients' cash and cash equivalents		1,241,282		—		—		1,241,282
Available-for-sale securities:
Commercial paper		6,643		6		—		6,649
Corporate bonds		44,343		414		—		44,757
Asset-backed securities		49,978		424		—		50,402
U.S. treasury securities		21,302		67		—		21,369
Total available-for-sale securities (1)		122,266		911		—		123,177
Total investments	$	1,614,399	$	911	$	—	$	1,615,310

(1)

Included within the fair value of total available-for-sale securities above is $37,155 of Corporate investments and $86,022 of Funds held for clients.


	June 30, 2021
			Gross		Gross
	Amortized		unrealized		unrealized
Type of Issue	cost		gains		losses		Fair value
Cash and cash equivalents	$	202,287	$	—	$	—	$	202,287
Funds held for clients' cash and cash equivalents		1,743,594		—		—		1,743,594
Available-for-sale securities:
Corporate bonds		13,390		70		—		13,460
Asset-backed securities		7,062		17		—		7,079
Total available-for-sale securities (2)		20,452		87		—		20,539
Total investments	$	1,966,333	$	87	$	—	$	1,966,420

(2)

Included within the fair value of total available-for-sale securities above is $4,456 of Corporate investments and $16,083 of Funds held for clients.

Schedule of the classification of investments


	June 30,		June 30,
	2020		2021
Cash and cash equivalents	$	250,851	$	202,287
Corporate investments		34,556		4,456
Funds held for clients		1,327,304		1,759,677
Long-term prepaid expenses and other		2,599		—
Total investments	$	1,615,310	$	1,966,420

Fair Value Measurement (Tables)

12 Months Ended

Jun. 30, 2021

Fair Value Measurement

Schedule of fair value level for cash and cash equivalents and available-for-sale securities measured on a recurring basis


	June 30, 2020
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	250,851	$	250,851	$	—	$	—
Funds held for clients' cash and cash equivalents		1,241,282		1,241,282		—		—
Available-for-sale securities:
Commercial paper		6,649		—		6,649		—
Corporate bonds		44,757		—		44,757		—
Asset-backed securities		50,402		—		50,402		—
U.S. treasury securities		21,369		—		21,369		—
Total available-for-sale securities		123,177		—		123,177		—
Total investments	$	1,615,310	$	1,492,133	$	123,177	$	—


	June 30, 2021
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	202,287	$	202,287	$	—	$	—
Funds held for clients' cash and cash equivalents		1,743,594		1,743,594		—		—
Available-for-sale securities:
Corporate bonds		13,460		—		13,460		—
Asset-backed securities		7,079		—		7,079		—
Total available-for-sale securities		20,539		—		20,539		—
Total investments	$	1,966,420	$	1,945,881	$	20,539	$	—

Capitalized Internal-Use Software (Tables)

12 Months Ended

Jun. 30, 2021

Capitalized Internal-Use Software.

Schedule of capitalized internal-use software and accumulated amortization


	Year ended June 30,
	2020		2021
Capitalized internal-use software	$	119,178	$	150,922
Accumulated amortization		(82,677)		(105,904)
Capitalized internal-use software, net	$	36,501	$	45,018

Property and Equipment (Tables)

12 Months Ended

Jun. 30, 2021

Property and Equipment.

Schedule of property and equipment, net


	Year ended June 30,
	2020		2021
Office equipment	$	4,619	$	5,211
Computer equipment		42,936		45,420
Furniture and fixtures		12,723		13,104
Software		6,609		6,641
Leasehold improvements		46,192		46,814
Time clocks rented by clients		4,967		5,399
Total		118,046		122,589
Accumulated depreciation		(51,309)		(62,754)
Property and equipment, net	$	66,737	$	59,835

Goodwill and Intangible Assets (Tables)

12 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets

Schedule of changes in goodwill


	Year ended June 30,
	2020		2021
Balance at beginning of year	$	9,590	$	21,655
Additions attributable to acquisitions		12,065		11,995
Balance at end of year	$	21,655	$	33,650

Schedule of amortizable intangible assets and estimated useful lives


					Weighted
					average
	Year ended June 30,				useful
	2020		2021		life (years)
Client relationships	$	19,200	$	19,200	8.2
Proprietary technology		2,962		6,129	5.0
Non-solicitation agreements		1,350		1,600	3.1
Trade name		350		440	5.0
Total		23,862		27,369
Accumulated amortization		(10,502)		(14,342)
Intangible assets, net	$	13,360	$	13,027

Schedule of future amortization expense for acquired intangible assets


Fiscal 2022	$	4,093
Fiscal 2023		3,919
Fiscal 2024		2,914
Fiscal 2025		1,860
Fiscal 2026		241
Total	$	13,027

Accrued Expenses (Tables)

12 Months Ended

Jun. 30, 2021

Accrued Expenses

Schedule of components of accrued expenses


	Year ended June 30,
	2020		2021
Accrued payroll and personnel costs	$	53,284	$	73,969
Operating lease liabilities		8,083		7,549
Deferred revenue		8,777		9,442
Other		9,737		12,149
Total accrued expenses	$	79,881	$	103,109

Leases (Tables)

12 Months Ended

Jun. 30, 2021

Leases

Schedule of components of operating lease expense


	Year ended June 30,
	2020		2021
Operating lease cost	$	9,686	$	9,139
Short-term lease cost		40		75
Variable lease cost		3,167		4,796
Total lease costs	$	12,893	$	14,010

Schedule of the classification of operating lease right-of-use assets and operating lease liabilities and other supplemental information related to operating leases


	Year ended June 30,
	2020			2021
Operating lease right-of-use assets	$	48,658		$	43,984
Accrued expenses	$	8,083		$	7,549
Long-term operating lease liabilities	$	73,299		$	67,201
Weighted-average remaining lease term (years)		10.3			9.6
Weighted-average discount rate		3.83	%		3.83	%

Schedule of supplemental cash flow information related to operating leases


	Year ended June 30,
	2020		2021
Cash paid for amounts included in the measurement of operating lease liabilities	$	10,374	$	11,093
Operating lease assets obtained in exchange for new liabilities	$	3,123	$	1,682

Schedule of undiscounted cash flows for future maturities of operating lease liabilities and the reconciliation to the balance of operating lease liabilities


Fiscal 2022	$	10,192
Fiscal 2023		9,798
Fiscal 2024		9,594
Fiscal 2025		9,392
Fiscal 2026		9,067
Thereafter		41,965
Total undiscounted cash flows		90,008
Less: Present value discount		(15,258)
Total operating lease liabilities	$	74,750

Income Taxes (Tables)

12 Months Ended

Jun. 30, 2021

Income Taxes

Schedule of income tax expense (benefit)


	Year ended June 30,
	2019		2020		2021
Current taxes
U.S. federal	$	—	$	—	$	—
State and local		90		(92)		(75)
Deferred taxes:
U.S. federal		5,449		403		(10,476)
State and local		(1,316)		2,352		(3,164)
Total income tax expense (benefit)	$	4,223	$	2,663	$	(13,715)

Schedule of tax rate reconciliation by applying the U.S. federal income tax rate to pretax income


	Year ended June 30,
	2019			2020			2021
Income tax expense (benefit) at statutory federal rate		21.0	%		21.0	%		21.0	%
Increase (reduction) in income taxes resulting from:
Research and development credit and other credits		(3.0)			(3.2)			(7.1)
Non-deductible expenses		1.3			1.6			1.4
Change in valuation allowance		0.3			5.2			2.8
Stock-based compensation expense		(10.4)			(18.3)			(35.0)
State and local income taxes, net of federal income tax benefit		(2.0)			(1.8)			(6.7)
Other		0.1			(0.5)			(0.4)
		7.3	%		4.0	%		(24.0)	%

Schedule of tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities


	Year ended June 30,
	2020		2021
Deferred tax assets:
Operating lease liabilities	$	21,041	$	19,415
Accrued expenses		9,915		13,559
Stock-based compensation		13,351		15,835
Net operating loss carryforwards		13,596		32,812
Federal and state tax credits		16,714		23,105
Other		—		179
Total deferred tax assets		74,617		104,905
Valuation allowance		(3,967)		(5,584)
Net deferred tax assets		70,650		99,321
Deferred tax liabilities:
Deferred contract costs		(41,229)		(56,618)
Operating lease right-of-use assets		(12,607)		(11,460)
Research and development costs		(8,563)		(10,664)
Intangible assets		(781)		(994)
Depreciation		(11,269)		(9,763)
Total deferred tax liabilities		(74,449)		(89,499)
Net deferred tax asset (liability)	$	(3,799)	$	9,822

Schedule of unrecognized tax benefits


		Year ended June 30,
	2021
Unrecognized tax benefits at beginning of the year	$	—
Additions for tax positions		84
Additions for tax positions of prior periods		450
Unrecognized tax benefit at end of year	$	534

Benefit Plans (Tables)

12 Months Ended

Jun. 30, 2021

Benefit Plans

Schedule of changes in the number of shares available for grant under equity incentive plans


		Number of Shares
Available for grant at July 1, 2020		9,519
January 1, 2021 Evergreen provision increase		1,000
RSUs granted		(494)
MSUs granted		(58)
Shares withheld in settlement of taxes and/or exercise price		436
Forfeitures		88
Shares removed		(179)
Available for grant at June 30, 2021		10,312

Schedule of stock-based compensation expense related to stock options, restricted stock units, market share units and the Employee Stock Purchase Plan


	Year ended June 30,
	2019		2020		2021
Cost of revenues	$	5,027	$	5,637	$	7,687
Sales and marketing		7,631		13,960		15,658
Research and development		5,325		7,182		10,192
General and administrative		20,782		20,714		29,515
Total stock-based compensation expense	$	38,765	$	47,493	$	63,052

Schedule of stock option activity


	Outstanding Options
				Weighted
		Weighted		average
		average		remaining	Aggregate
	Number of	exercise		contractual	intrinsic
	shares	price		term (years)	value
Balance at July 1, 2020	1,255	$	12.43	3.0	$	167,406
Options exercised	(490)	$	6.76
Balance at June 30, 2021	765	$	16.06	2.4	$	133,550
Options vested and exercisable at June 30, 2021	765	$	16.06	2.4	$	133,550

Summary of the assumptions used for estimating the grant date fair value of MSUs


Expected dividend yield	0	%
Expected volatility	52.0	%
Expected term (years)	3.04
Risk‑free interest rate	0.18	%

Schedule of restricted stock unit activity


	Units	Weighted average grant date fair value
RSU balance at July 1, 2020	1,626	$	73.96
RSUs granted	494	$	135.17
RSUs vested	(644)	$	65.46
RSUs forfeited	(88)	$	91.46
RSU balance at June 30, 2021	1,388	$	100.33
RSUs expected to vest at June 30, 2021	1,314	$	99.53

Schedule of weighted average assumptions used for estimating grant date fair value of the ESPP



	Year ended June 30,
	2019		2020		2021
Valuation assumptions:
Expected dividend yield	0	%	0	%	0	%
Expected volatility	33.5 - 38.6	%	38.6 - 72.2	%	42.2 - 72.2	%
Expected term (years)	0.5		0.5		0.5
Risk‑free interest rate	2.10 - 2.48	%	0.15 - 2.44	%	0.04 - 0.15	%

Net Income Per Share (Tables)

12 Months Ended

Jun. 30, 2021

Net Income Per Share

Schedule of calculation of basic and diluted net income per share


	Year ended June 30,
	2019		2020		2021
Numerator:
Net income	$	53,823	$	64,455	$	70,819

Denominator:
Weighted-average shares used in computing net income per share:
Basic		52,914		53,547		54,318
Weighted-average effect of potentially dilutive shares:
Employee stock options, restricted stock units, market share units and employee stock purchase plan shares		2,500		2,260		1,987
Diluted		55,414		55,807		56,305

Net income per share:
Basic	$	1.02	$	1.20	$	1.30
Diluted	$	0.97	$	1.15	$	1.26

Summary of anti-dilutive securities


	Year ended June 30,
	2019	2020	2021
Market share units	—	—	38
Restricted stock units	69	23	6
Employee stock purchase plan shares	13	—	—
Total	82	23	44

Summary of Significant Accounting Policies - Current Presentation, Concentration of Risk, Accounts Receivable (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Funds Held For Clients, Corporate Investments and Client Fund Obligations
Credit Impairment Loss	$ 0	$ 0	$ 0
Period of repayment of client fund obligations	1 year
Accounts Receivable
Number of days past due before a balance will be reviewed for collectability	60 days
Activity in the allowance for credit losses
Balance at the beginning of the year	$ 617	473	375
Charged to expense	316	309	283
Write-offs	(133)	(165)	(185)
Balance at the end of the year	$ 800	$ 617	$ 473

Summary of Significant Accounting Policies - Deferred Contract Costs (Details)	Jun. 30, 2021
Deferred contract costs
Amortization period of capitalized contract costs	7 years

Summary of Significant Accounting Policies - Capitalized Internal-Use Software (Details) - Internal-Use Software	12 Months Ended
	Jun. 30, 2021
Minimum
Capitalized internal-use software
Estimated useful lives	24 months
Maximum
Capitalized internal-use software
Estimated useful lives	36 months

Summary of Significant Accounting Policies - PP&E (Details)	12 Months Ended
	Jun. 30, 2021
Minimum
Property and Equipment and Long-Lived Assets
Estimated useful lives of the assets	3 years
Maximum
Property and Equipment and Long-Lived Assets
Estimated useful lives of the assets	7 years

Summary of Significant Accounting Policies - Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Goodwill
Impairment loss	$ 0	$ 0	$ 0
Proprietary technology
Intangible assets, net of accumulated amortization
Estimated useful lives	5 years
Trade name
Intangible assets, net of accumulated amortization
Estimated useful lives	5 years
Minimum \| Client relationships
Intangible assets, net of accumulated amortization
Estimated useful lives	5 years
Maximum \| Client relationships
Intangible assets, net of accumulated amortization
Estimated useful lives	9 years

Summary of Significant Accounting Policies - Leases (Details)	12 Months Ended
	Jun. 30, 2021
Summary of Significant Accounting Policies
Lessee, Operating Lease, Existence of Option to Extend [true false]	true

Summary of Significant Accounting Policies - Revenue (Details)	12 Months Ended
	Jun. 30, 2021
Revenue from contracts terms
Period of term arrangements	2 years
Cost of revenues
Amortization period of cost of revenues for proprietary products	7 years
Maximum
Revenue from contracts terms
Notice period to cancel agreement	60 days
Deferred and amortized period of implementation fees	24 months

Summary of Significant Accounting Policies - Advertising, Segment Information (Details) $ in Thousands	12 Months Ended
	Jun. 30, 2021 USD ($) segment	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)
Advertising
Advertising costs \| $	$ 3,189	$ 1,023	$ 283
Segment Information
Number of reporting segments \| segment	1

Summary of Significant Accounting Policies - Adjustments for Adoption (Details) - USD ($) $ in Thousands	Jul. 01, 2019	Jun. 30, 2021	Jun. 30, 2020
Recently adopted accounting standards
Operating lease right-of-use assets		$ 43,984	$ 48,658
Operating lease liabilities		$ 74,750
Topic 842
Recently adopted accounting standards
Change in Accounting Principle, Accounting Standards Update, Adopted [true false]	true
Transition option elected	us_gaap:AccountingStandardsUpdate201602RetrospectiveMember
Practical expedients package adopted	true
Practical expedient single lease component adopted	true
Operating lease right-of-use assets	$ 52,083
Operating lease liabilities	83,852
Deferred rent adjustments included in net ROU assets	31,769
Impact of adoption on unaudited consolidated statements of operations and comprehensive income or the unaudited statement of cash flows	$ 0

Revenue - Disaggregation (Details) - USD ($) $ in Thousands	12 Months Ended
Revenue - Disaggregation (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Disaggregation of revenue
Recurring and other revenue	$ 631,725	$ 546,212	$ 447,752
Recurring fees
Disaggregation of revenue
Recurring and other revenue	609,658	526,267	436,955
Implementation services and other
Disaggregation of revenue
Recurring and other revenue	$ 22,067	$ 19,945	$ 10,797

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Revenue - Deferred Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Changes in deferred revenue related to nonrefundable upfront fees
Balance at beginning of the year	$ 8,434	$ 6,289
Deferral of revenue	16,106	15,998
Revenue recognized	(15,806)	(13,853)
Balance at end of the year	$ 8,734	$ 8,434
Maximum
Revenue
Recognition period of nonrefundable upfront implementation fees	24 months
Implementation services and other
Changes in deferred revenue related to nonrefundable upfront fees
Deferred revenue from nonrefundable upfront fees expected to be recognized in fiscal 2022	$ 7,068
Deferred revenue from nonrefundable upfront fees expected to be recognized in fiscal 2023	1,600
Deferred revenue from nonrefundable upfront fees expected to be recognized thereafter	$ 66

Revenue - Deferred contract costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Deferred contract costs
Beginning Balance	$ 158,043	$ 103,099
Capitalized Costs	95,407	82,422
Amortization	(38,557)	(27,478)
Ending Balance	214,893	158,043	$ 103,099
Impairment losses	0	0	0
Costs to obtain a new contract
Deferred contract costs
Beginning Balance	113,575	82,103
Capitalized Costs	60,833	53,529
Amortization	(28,690)	(22,057)
Ending Balance	145,718	113,575	82,103
Costs to fulfill a contract
Deferred contract costs
Beginning Balance	44,468	20,996
Capitalized Costs	34,574	28,893
Amortization	(9,867)	(5,421)
Ending Balance	$ 69,175	$ 44,468	$ 20,996

Revenue - Performance Obligations (Details) $ in Thousands	Jun. 30, 2021 USD ($)
Remaining Performance Obligations
Minimum value of unsatisfied performance obligations on term-based contracts	$ 47,854
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01
Remaining Performance Obligations
Remaining performance obligation period	24 months

Corporate Investments and Funds Held For Clients - Reconciliation (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Corporate Investments and Funds Held for Clients
Amortized cost of cash and cash equivalents	$ 202,287	$ 250,851
Fair value of cash and cash equivalents	202,287	250,851	$ 132,476
Amortized cost of funds held for clients' cash and cash equivalents	1,743,594	1,241,282
Fair value of funds held for clients' cash and cash equivalents	1,743,594	1,241,282	$ 1,293,667
Available-for-sale securities
Amortized cost	20,452	122,266
Gross unrealized gains	87	911
Fair value	20,539	123,177
Total investments at amortized cost	1,966,333	1,614,399
Total investments gross unrealized gains	87	911
Total investments at fair value	1,966,420	1,615,310
Commercial paper
Available-for-sale securities
Amortized cost		6,643
Gross unrealized gains		6
Fair value		6,649
Corporate bonds
Available-for-sale securities
Amortized cost	13,390	44,343
Gross unrealized gains	70	414
Fair value	13,460	44,757
Asset-backed securities
Available-for-sale securities
Amortized cost	7,062	49,978
Gross unrealized gains	17	424
Fair value	7,079	50,402
U.S. treasury securities
Available-for-sale securities
Amortized cost		21,302
Gross unrealized gains		67
Fair value		21,369
Corporate investments
Available-for-sale securities
Fair value	4,456	37,155
Funds held for clients
Available-for-sale securities
Fair value	$ 16,083	$ 86,022

Corporate Investments and Funds Held For Clients - Classification (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Corporate Investments and Funds Held for Clients
Cash and cash equivalents	$ 202,287	$ 250,851	$ 132,476
Corporate investments	4,456	34,556
Funds held for clients	1,759,677	1,327,304
Long-term prepaid expenses and other		2,599
Total investments at fair value	1,966,420	1,615,310
Available-for-sale securities
Available-for-sale securities in an unrealized loss position	0	0
Gross realized gains and losses on the sale of available-for-sale securities	0	0	0
Credit impairment losses	0	0	0
Reclassification out of Accumulated Other Comprehensive Income
Available-for-sale securities
Gross realized gains and losses on the sale of available-for-sale securities	$ 0	$ 0	$ 0

Fair Value Measurement (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Fair value measurement
Cash and cash equivalents	$ 202,287	$ 250,851	$ 132,476
Funds held for clients' cash and cash equivalents	1,743,594	1,241,282	$ 1,293,667
Total investments at fair value	1,966,420	1,615,310
Available-for-sale securities:
Total available-for-sale securities	20,539	123,177
Level 1
Fair value measurement
Cash and cash equivalents	202,287	250,851
Funds held for clients' cash and cash equivalents	1,743,594	1,241,282
Total investments at fair value	1,945,881	1,492,133
Level 2
Fair value measurement
Total investments at fair value	20,539	123,177
Available-for-sale securities:
Total available-for-sale securities	20,539	123,177
Level 3
Available-for-sale securities:
Total available-for-sale securities	0	0
Commercial paper
Available-for-sale securities:
Total available-for-sale securities		6,649
Commercial paper \| Level 2
Available-for-sale securities:
Total available-for-sale securities		6,649
Corporate bonds
Available-for-sale securities:
Total available-for-sale securities	13,460	44,757
Corporate bonds \| Level 2
Available-for-sale securities:
Total available-for-sale securities	13,460	44,757
Asset-backed securities
Available-for-sale securities:
Total available-for-sale securities	7,079	50,402
Asset-backed securities \| Level 2
Available-for-sale securities:
Total available-for-sale securities	$ 7,079	50,402
U.S. treasury securities
Available-for-sale securities:
Total available-for-sale securities		21,369
U.S. treasury securities \| Level 2
Available-for-sale securities:
Total available-for-sale securities		$ 21,369

Business Combinations (Details) - USD ($) $ in Thousands	1 Months Ended
Business Combinations (Details) - USD ($) $ in Thousands	Nov. 30, 2020	Apr. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Business Combinations
Goodwill			$ 33,650	$ 21,655	$ 9,590
Intangible assets			27,369	23,862
Proprietary technology
Business Combinations
Intangible assets			$ 6,129	$ 2,962
VidGrid, Inc.
Business Combinations
Purchase price consideration		$ 17,256
Goodwill		12,065
VidGrid, Inc. \| Proprietary technology
Business Combinations
Intangible assets		$ 2,962
Samepage Labs Inc
Business Combinations
Purchase price consideration	$ 15,018
Goodwill	11,995
Samepage Labs Inc \| Proprietary technology
Business Combinations
Intangible assets	$ 3,167

Capitalized Internal-Use Software (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Capitalized internal-use software and accumulated amortization
Capitalized internal-use software	$ 150,922	$ 119,178
Accumulated amortization	(105,904)	(82,677)
Capitalized internal-use software, net	45,018	36,501
Cost of revenue - recurring
Capitalized internal-use software and accumulated amortization
Amortization of capitalized internal-use software	$ 23,227	$ 19,261	$ 16,921

Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Property and equipment
Property and equipment, gross	$ 122,589	$ 118,046
Accumulated depreciation	(62,754)	(51,309)
Property and equipment, net	59,835	66,737
Depreciation expense	15,905	16,129	$ 15,392
Office equipment
Property and equipment
Property and equipment, gross	5,211	4,619
Computer equipment
Property and equipment
Property and equipment, gross	45,420	42,936
Furniture and fixtures
Property and equipment
Property and equipment, gross	13,104	12,723
Software
Property and equipment
Property and equipment, gross	6,641	6,609
Leasehold improvements
Property and equipment
Property and equipment, gross	46,814	46,192
Time clocks rented by clients
Property and equipment
Property and equipment, gross	$ 5,399	$ 4,967

Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Changes in goodwill
Balance at the beginning of year	$ 21,655	$ 9,590
Additions attributable to acquisitions	11,995	12,065
Balance at end of year	33,650	21,655	$ 9,590
Amortizable intangible assets
Intangible assets	27,369	23,862
Accumulated amortization	(14,342)	(10,502)
Intangible assets, net	13,027	13,360
Amortization expense for acquired intangible assets	3,840	2,523	$ 2,251
Future amortization expense for acquired intangible assets
Fiscal 2022	4,093
Fiscal 2023	3,919
Fiscal 2024	2,914
Fiscal 2025	1,860
Fiscal 2026	241
Intangible assets, net	13,027	13,360
Client relationships
Amortizable intangible assets
Intangible assets	$ 19,200	19,200
Useful life	8 years 2 months 12 days
Proprietary technology
Amortizable intangible assets
Intangible assets	$ 6,129	2,962
Useful life	5 years
Non-solicitation agreements
Amortizable intangible assets
Intangible assets	$ 1,600	1,350
Useful life	3 years 1 month 6 days
Trade name
Amortizable intangible assets
Intangible assets	$ 440	$ 350
Useful life	5 years

Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020
Components of accrued expenses
Accrued payroll and personnel costs	$ 73,969	$ 53,284
Operating lease liabilities	$ 7,549	$ 8,083
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Total accrued expenses	Total accrued expenses
Deferred revenue	$ 9,442	$ 8,777
Other	12,149	9,737
Total accrued expenses	$ 103,109	$ 79,881

Debt (Details) - USD ($) $ in Thousands	1 Months Ended		12 Months Ended
Debt (Details) - USD ($) $ in Thousands	Apr. 30, 2020	Jul. 31, 2019	Jun. 30, 2021	Jun. 30, 2020
Debt
Outstanding borrowings				$ 100,000
Repayment of credit facility			$ 100,000
Five-year revolving credit agreement \| Senior secured debt
Debt
Term of credit agreement		5 years
Maximum borrowing capacity		$ 250,000
Maximum borrowing capacity, subject to additional lender commitments and satisfaction of other requirements		$ 375,000
Outstanding borrowings	$ 100,000
Average interest rate			1.04%
Five-year revolving credit agreement \| Senior secured debt \| Minimum
Debt
Interest coverage ratio		3.00
Five-year revolving credit agreement \| Senior secured debt \| Maximum
Debt
Net total leverage ratio		4.00
Senior secured leverage ratio		3.50
Five-year revolving credit agreement \| Senior secured debt \| LIBOR \| Minimum
Debt
Margin on base rate		0.875%
Five-year revolving credit agreement \| Senior secured debt \| LIBOR \| Maximum
Debt
Margin on base rate		1.375%
Five-year revolving credit agreement \| Senior secured debt \| Adjusted base rate \| Minimum
Debt
Margin on base rate		0.00%
Five-year revolving credit agreement \| Senior secured debt \| Adjusted base rate \| Maximum
Debt
Margin on base rate		0.375%

Leases - Operating lease components (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Components of operating lease expense:
Operating lease cost	$ 9,139	$ 9,686
Short-term lease cost	75	40
Variable lease cost	4,796	3,167
Total lease costs	$ 14,010	$ 12,893

Leases - Operating lease ROU assets, operating lease liabilities and other supplemental information (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020
Operating leases:
Operating lease right-of-use assets	$ 43,984	$ 48,658
Accrued expenses	7,549	8,083
Long-term operating lease liabilities	$ 67,201	$ 73,299
Weighted-average remaining lease term (years)	9 years 7 months 6 days	10 years 3 months 18 days
Weighted-average discount rate	3.83%	0.0383%

Leases - Supplemental cash flow information (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Operating leases:
Cash paid for amounts included in the measurement of operating lease liabilities	$ 11,093	$ 10,374
Operating lease assets obtained in exchange for new liabilities	$ 1,682	$ 3,123

Leases - Future maturities and leases that had not yet commenced (Details) $ in Thousands	Jun. 30, 2021 USD ($)
Undiscounted cash flows for future maturities of operating lease liabilities and the reconciliation to the balance of operating lease liabilities
Fiscal 2022	$ 10,192
Fiscal 2023	9,798
Fiscal 2024	9,594
Fiscal 2025	9,392
Fiscal 2026	9,067
Thereafter	41,965
Total undiscounted cash flows	90,008
Less: Present value discount	(15,258)
Total operating lease liabilities	$ 74,750

Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Current taxes
State and local	$ (75)	$ (92)	$ 90
Deferred taxes:
U.S. federal	(10,476)	403	5,449
State and local	(3,164)	2,352	(1,316)
Total income tax expense (benefit)	(13,715)	2,663	4,223
Tax Rate Reconciliation
Pre-tax income	$ 57,104	$ 67,118	$ 58,046
Income tax expense (benefit) at statutory federal rate	21.00%	21.00%	21.00%
Increase (reduction) in income taxes resulting from:
Research and development credit and other credits	(7.10%)	(3.20%)	(3.00%)
Non-deductible expenses	1.40%	1.60%	1.30%
Change in valuation allowance	2.80%	5.20%	0.30%
Stock-based compensation expense	(35.00%)	(18.30%)	(10.40%)
State and local income taxes, net of federal income tax benefit	(6.70%)	(1.80%)	(2.00%)
Other	(0.40%)	(0.50%)	0.10%
Total effective income tax rate	(24.00%)	4.00%	7.30%
Deferred tax assets:
Operating lease liabilities	$ 19,415	$ 21,041
Accrued expenses	13,559	9,915
Stock-based compensation	15,835	13,351
Net operating loss carryforwards	32,812	13,596
Federal and state tax credits	23,105	16,714
Other	179
Total deferred tax assets	104,905	74,617
Valuation allowance	(5,584)	(3,967)
Net deferred tax assets	99,321	70,650
Deferred tax liabilities:
Deferred contract costs	(56,618)	(41,229)
Operating lease right-of-use assets	(11,460)	(12,607)
Research and development costs	(10,664)	(8,563)
Intangible assets	(994)	(781)
Depreciation	(9,763)	(11,269)
Total deferred tax liabilities	(89,499)	(74,449)
Net deferred tax liability		$ (3,799)
Net deferred tax asset	9,822
State
Deferred tax assets:
Valuation allowance	$ (5,584)

Income Taxes - Carryforwards (Details) $ in Thousands	12 Months Ended
Income Taxes - Carryforwards (Details) $ in Thousands	Jun. 30, 2021 USD ($)
Unrecognized Tax Benefits
Additions for tax positions	$ 84
Additions for tax positions of prior periods	450
Unrecognized tax benefit at end of year	534
Federal And State
Operating loss carryforwards
Net operating loss carryforwards with indefinite utilization periods	116,851
Federal
Operating loss carryforwards
Net operating loss carryforwards	129,406
Net operating loss carryforwards that will expire	$ 37,525
Federal \| Minimum
Operating loss carryforwards
Expiration date for net operating losses	Jun. 30, 2034
Federal \| Maximum
Operating loss carryforwards
Expiration date for net operating losses	Jun. 30, 2038
State
Operating loss carryforwards
Net operating loss carryforwards	$ 98,721
Net operating loss carryforwards that will expire	$ 73,751
State \| Minimum
Operating loss carryforwards
Expiration date for net operating losses	Jun. 30, 2021
Unrecognized Tax Benefits
Statute of limitations on filings	3 years
State \| Maximum
Operating loss carryforwards
Expiration date for net operating losses	Jun. 30, 2040
Unrecognized Tax Benefits
Statute of limitations on filings	4 years
Research and development and other \| Federal And State
Tax credit carryforwards
Tax credit carryforwards	$ 23,639
Research and development and other \| Federal And State \| Minimum
Tax credit carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2022
Research and development and other \| Federal And State \| Maximum
Tax credit carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2041

Stockholders' Equity (Details)	12 Months Ended
Stockholders' Equity (Details)	Jun. 30, 2021 item
Common Stock
Stockholders' Equity
Number of common stock vote per share	1

Benefit Plans - General Information (Details) - shares shares in Thousands		12 Months Ended
	Jan. 01, 2021	Jun. 30, 2021
Equity Incentive Plans
Equity Incentive Plans
Actual increase in number of shares available for issuance		1,000
Number of shares of common stock reserved for issuance		12,523
Number of shares allocated but not yet issued that are subject to outstanding options or awards		2,211
2008 Plan
Equity Incentive Plans
Awards issued (in shares)		0
Awards issuable (in shares)		0
2014 Plan
Equity Incentive Plans
Potential number of additional shares available for grant each year (as a percent)		4.50%
Actual increase in number of shares available for issuance	1,000

Benefit Plans - Incentive Plans Activity (Details) - shares shares in Thousands		12 Months Ended
	Jan. 01, 2021	Jun. 30, 2021
Equity Incentive Plans
Shares Available for Grant
Balance at the beginning of the year		9,519
January 1, 2021 Evergreen provision increase		1,000
RSUs granted		(494)
MSUs granted		(58)
Shares withheld in settlement of taxes and/or exercise price		436
Forfeitures		88
Shares removed		(179)
Balance at the end of the year		10,312
2014 Plan
Shares Available for Grant
January 1, 2021 Evergreen provision increase	1,000

Benefit Plans - Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Benefit Plans
Total stock-based compensation expense	$ 63,052	$ 47,493	$ 38,765
Stock-based compensation expense capitalized in internal-use software costs	2,610	2,397	2,760
Cost of revenues
Benefit Plans
Total stock-based compensation expense	7,687	5,637	5,027
Sales and marketing
Benefit Plans
Total stock-based compensation expense	15,658	13,960	7,631
Research and development
Benefit Plans
Total stock-based compensation expense	10,192	7,182	5,325
General and administrative
Benefit Plans
Total stock-based compensation expense	29,515	$ 20,714	$ 20,782
Modified performance-based restricted stock unit awards
Benefit Plans
Total stock-based compensation expense	$ 6,423

Benefit Plans - Stock Option Activity (Details) - Stock options - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Options Outstanding, Number of Shares
Balance at the beginning of the year	1,255
Options granted	0	0	0
Options exercised	(490)
Balance at the end of the year	765	1,255
Options Outstanding, Weighted average exercise price
Balance at the beginning of the year (in dollars per share)	$ 12.43
Options exercised (in dollars per share)	6.76
Balance at the end of the year (in dollars per share)	$ 16.06	$ 12.43
Options Additional Disclosures
Weighted average remaining contractual term	2 years 4 months 24 days	3 years
Aggregate intrinsic value at the beginning of the year	$ 167,406
Weighted average remaining contractual term of options vested and exercisable at the end of the year (years)	2 years 4 months 24 days
Aggregate intrinsic value at the end of the year	$ 133,550	$ 167,406
Options vested and exercisable at the end of the year (in shares)	765
Options vested and exercisable at the end of the year, weighted average exercise price (in dollars per share)	$ 16.06
Options vested and exercisable intrinsic value	$ 133,550
Total intrinsic value of options exercised	$ 84,072	$ 29,791	$ 24,920

Benefit Plans - RSU activity (Details) - Restricted stock units - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Unrecognized Compensation Costs Not yet Recognized, Net of Estimated Forfeitures
Total unrecognized compensation cost, net of estimated forfeitures related to unvested RSUs	$ 55,289
Weighted average period to recognize unrecognized compensation cost	1 year 9 months 18 days
Excess income tax benefits
Excess income tax benefits for stock-based compensation arrangements recognized through income tax expense (benefit)	$ 128,229	$ 67,816	$ 41,195
RSUs Outstanding Rollforward, Units
RSU balance at the beginning of the year	1,626
RSUs granted	494
RSUs vested	(644)
RSUs forfeited	(88)
RSU balance at the end of the year	1,388	1,626
RSUs expected to vest at the end of the year	1,314
RSUs Outstanding, Weighted average grant date fair value
RSU balance at the beginning of the year	$ 73.96
RSUs granted	135.17
RSUs vested	65.46
RSUs forfeited	91.46
RSU balance at the end of the year	100.33	$ 73.96
RSUs expected to vest at the end of the year	$ 99.53
Minimum
Equity Incentive Plans
Vesting period	3 years
Maximum
Equity Incentive Plans
Vesting period	4 years

Benefit Plans - MSU (Details) - Market share units $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2021 USD ($) $ / shares shares
Equity Incentive Plans
Grant date fair value \| $ / shares	$ 178.04
Vesting period	3 years
Valuation assumptions:
Expected dividend yield	0.00%
Expected volatility	52.00%
Expected term (years)	3 years 14 days
Risk-free interest rate	0.18%
Unrecognized Compensation Costs Not yet Recognized, Net of Estimated Forfeitures
Total unrecognized compensation cost, net of estimated forfeitures related to unvested MSUs \| $	$ 6,608
Weighted average period to recognize unrecognized compensation cost	2 years 2 months 12 days
Maximum
Equity Incentive Plans
Percentage of award shares eligible to vest, maximum	200.00%
2014 Plan
Equity Incentive Plans
Number of awards granted \| shares	58

Benefit Plans- ESPP Information (Details) - USD ($) shares in Thousands, $ in Thousands		12 Months Ended
	Jan. 01, 2021	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Equity Incentive Plans
Stock-based compensation expense		$ 63,052	$ 47,493	$ 38,765
Equity Incentive Plans
Equity Incentive Plans
Number of shares of common stock reserved for issuance		12,523
Employee stock purchase plan shares
Equity Incentive Plans
Offering period		6 months
Percentage of employee compensation, maximum		10.00%
Percentage of fair market value as a purchase price		85.00%
Maximum value of purchase per employee		$ 25
Number of shares per employee, maximum		2
Period during which shares can be purchased		1 year
Potential number of additional shares reserved for issuance each year		400
Potential number of additional shares reserved for issuance each year (as percent)		0.75%
Number of shares of common stock reserved for issuance		1,194
Number of shares issued		104
Increase in the number of shares of common stock reserved for issuance	400
Stock-based compensation expense		$ 4,570	$ 3,235	$ 1,949
Valuation assumptions:
Expected dividend yield		0.00%	0.00%	0.00%
Expected term (years)		6 months	6 months	6 months
Employee stock purchase plan shares \| Minimum
Valuation assumptions:
Expected volatility		42.20%	38.60%	33.50%
Risk-free interest rate		0.04%	0.15%	2.10%
Employee stock purchase plan shares \| Maximum
Equity Incentive Plans
Offering period		27 months
Valuation assumptions:
Expected volatility		72.20%	72.20%	38.60%
Risk-free interest rate		0.15%	2.44%	2.48%
Market share units
Valuation assumptions:
Expected dividend yield		0.00%
Expected volatility		52.00%
Expected term (years)		3 years 14 days
Risk-free interest rate		0.18%

Benefit Plans - 401(k) Plan (Details) - USD ($) $ in Thousands		12 Months Ended
	Jan. 01, 2016	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019
Benefit Plans
401(k) Plan Matching contributions by the Company as percentage of employees' contributions	50.00%
401(k) Plan Maximum contributions by the Company as percentage of employees' gross pay	8.00%
401(k) Plan contributions		$ 2,658	$ 7,914	$ 5,693

Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended	12 Months Ended
	Sep. 30, 2019	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019	Aug. 31, 2018
Anti-dilutive securities excluded from diluted per share calculations
Anti-dilutive securities excluded		44	23	82
Numerator:
Net income		$ 70,819	$ 64,455	$ 53,823
Weighted-average shares used in computing net income per share:
Basic (in shares)		54,318	53,547	52,914
Weighted-average effect of potentially dilutive shares:
Employee stock options, restricted stock units, market share units and employee stock purchase plan shares		1,987	2,260	2,500
Diluted (in shares)		56,305	55,807	55,414
Net income per share:
Basic (in dollars per share)		$ 1.30	$ 1.20	$ 1.02
Diluted (in dollars per share)		$ 1.26	$ 1.15	$ 0.97
Stock Repurchase Program
Repurchases of common shares	$ 34,991			$ 34,991
Maximum
Stock Repurchase Program
Maximum value of issued and outstanding common stock eligible for repurchase under the stock repurchase program					$ 35,000
Market share units
Anti-dilutive securities excluded from diluted per share calculations
Anti-dilutive securities excluded		38
Restricted stock units
Anti-dilutive securities excluded from diluted per share calculations
Anti-dilutive securities excluded		6	23	69
Employee stock purchase plan shares
Anti-dilutive securities excluded from diluted per share calculations
Anti-dilutive securities excluded				13
Common Stock
Stock Repurchase Program
Repurchases of common shares (in shares)	442			442