0001558370-17-006561 | 10-K | XBRL Viewer

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Jun. 30, 2017	Aug. 04, 2017	Dec. 31, 2016
Document and Entity Information
Entity Registrant Name	Paylocity Holding Corp
Entity Central Index Key	0001591698
Document Type	10-K
Document Period End Date	Jun. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 774.8
Entity Common Stock, Shares Outstanding		51,750,086
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016
Current assets:
Cash and cash equivalents	$ 103,468	$ 86,496
Accounts receivable, net	2,040	1,681
Prepaid expenses and other	14,879	7,409
Total current assets before funds held for clients	120,387	95,586
Funds held for clients	942,459	1,239,622
Total current assets	1,062,846	1,335,208
Long-term prepaid expenses	1,535	845
Capitalized internal-use software, net	17,394	11,427
Property and equipment, net	40,756	26,787
Intangible assets, net	8,907	10,419
Goodwill	6,003	6,003
Total assets	1,137,441	1,390,689
Current liabilities:
Accounts payable	2,046	1,621
Accrued expenses	30,301	24,979
Total current liabilities before client fund obligations	32,347	26,600
Client fund obligations	942,459	1,239,622
Total current liabilities	974,806	1,266,222
Deferred rent	14,621	4,646
Deferred income tax liabilities, net	401	249
Total liabilities	989,828	1,271,117
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000 authorized, no shares issued and outstanding at June 30, 2016 and 2017
Common stock, $0.001 par value, 155,000 shares authorized at June 30, 2016 and 2017; 51,132 shares issued and outstanding at June 30, 2016 and 51,738 shares issued and outstanding at June 30, 2017	52	51
Additional paid-in capital	192,837	171,515
Accumulated deficit	(45,276)	(51,994)
Total stockholders' equity	147,613	119,572
Total liabilities and stockholders' equity	$ 1,137,441	$ 1,390,689

Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Jun. 30, 2017	Jun. 30, 2016
Unaudited 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	51,738	51,132
Common Stock, shares outstanding	51,738	51,132

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Revenues:
Recurring fees	$ 284,817	$ 217,416	$ 142,168
Interest income on funds held for clients	3,631	2,688	1,901
Total recurring revenues	288,448	220,104	144,069
Implementation services and other	11,562	10,597	8,629
Total revenues	300,010	230,701	152,698
Cost of revenues:
Recurring revenues	85,399	66,131	46,366
Implementation services and other	38,588	31,954	24,530
Total cost of revenues	123,987	98,085	70,896
Gross profit	176,023	132,616	81,802
Operating expenses:
Sales and marketing	77,506	61,832	43,035
Research and development	29,098	26,736	19,864
General and administrative	62,123	47,598	32,824
Total operating expenses	168,727	136,166	95,723
Operating income (loss)	7,296	(3,550)	(13,921)
Other income (expense)	73	(124)	54
Income (loss) before income taxes	7,369	(3,674)	(13,867)
Income tax expense	651	177	105
Net income (loss)	$ 6,718	$ (3,851)	$ (13,972)
Net income (loss) per share:
Basic (in dollars per share)	$ 0.13	$ (0.08)	$ (0.28)
Diluted (in dollars per share)	$ 0.12	$ (0.08)	$ (0.28)
Weighted-average shares used in computing net income (loss) per share:
Basic (in shares)	51,415	50,913	50,127
Diluted (in shares)	54,057	50,913	50,127

Consolidated Statement of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balance at Jun. 30, 2014	$ 50	$ 125,255	$ (34,171)	$ 91,134
Balance (in shares) at Jun. 30, 2014	49,564
Increase (Decrease) in Stockholders' Equity
Follow-on offering, net of issuance costs	$ 1	18,366		18,367
Follow-on offering, net of issuance costs (in shares)	750
Stock-based compensation expense		13,824		13,824
Stock options exercised		4,335		4,335
Stock options exercised (in shares)	452
Issuance of common stock upon vesting of restricted stock units (in shares)	120
Issuance of common stock under employee stock purchase plan		1,773		1,773
Issuance of common stock under employee stock purchase plan (in shares)	83
Net settlement for taxes and/or exercise price related to equity awards		(7,881)		(7,881)
Net settlement for taxes and/or exercise price related to equity awards (in shares)	(266)
Net income (loss)			(13,972)	(13,972)
Balance at Jun. 30, 2015	$ 51	155,672	(48,143)	107,580
Balance (in shares) at Jun. 30, 2015	50,703
Increase (Decrease) in Stockholders' Equity
Stock-based compensation expense		18,641		18,641
Stock options exercised		6,197		6,197
Stock options exercised (in shares)	536
Issuance of common stock upon vesting of restricted stock units (in shares)	120
Issuance of common stock under employee stock purchase plan		2,991		2,991
Issuance of common stock under employee stock purchase plan (in shares)	102
Net settlement for taxes and/or exercise price related to equity awards		(11,986)		(11,986)
Net settlement for taxes and/or exercise price related to equity awards (in shares)	(329)
Net income (loss)			(3,851)	(3,851)
Balance at Jun. 30, 2016	$ 51	171,515	(51,994)	$ 119,572
Balance (in shares) at Jun. 30, 2016	51,132			51,132
Increase (Decrease) in Stockholders' Equity
Stock-based compensation expense		28,507		$ 28,507
Stock options exercised	$ 1	8,550		8,551
Stock options exercised (in shares)	691
Issuance of common stock upon vesting of restricted stock units (in shares)	255
Issuance of common stock under employee stock purchase plan		3,677		3,677
Issuance of common stock under employee stock purchase plan (in shares)	127
Net settlement for taxes and/or exercise price related to equity awards		(19,859)		(19,859)
Net settlement for taxes and/or exercise price related to equity awards (in shares)	(467)
Excess tax benefits from stock-based compensation		447		447
Net income (loss)			6,718	6,718
Balance at Jun. 30, 2017	$ 52	$ 192,837	$ (45,276)	$ 147,613
Balance (in shares) at Jun. 30, 2017	51,738			51,738

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net income (loss)	$ 6,718	$ (3,851)	$ (13,972)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Stock-based compensation expense	26,734	17,563	13,169
Depreciation and amortization expense	21,027	13,873	8,609
Deferred income tax expense	152	150	91
Provision for doubtful accounts	113	159	90
Loss on disposal of equipment	253	712	256
Changes in operating assets and liabilities:
Accounts receivable	(472)	(725)	(449)
Prepaid expenses and other	(2,074)	(3,270)	(1,754)
Accounts payable	219	72	(186)
Accrued expenses	6,465	8,310	5,251
Tenant improvement allowance	2,845
Net cash provided by operating activities	61,980	32,993	11,105
Cash flows from investing activities:
Capitalized internal-use software costs	(13,641)	(8,391)	(4,215)
Purchases of property and equipment	(21,338)	(16,083)	(9,020)
Lease allowances used for tenant improvements	(2,845)
Payments for acquisitions		(483)	(11,979)
Net change in funds held for clients	297,163	(648,403)	(173,958)
Net cash provided by (used in) investing activities	259,339	(673,360)	(199,172)
Cash flows from financing activities:
Net change in client funds obligation	(297,163)	648,403	173,958
Proceeds from follow-on offering, net of issuance costs			18,367
Payments on initial public offering costs			(75)
Proceeds from exercise of stock options	34	137	247
Proceeds from employee stock purchase plan	3,677	2,991	1,773
Taxes paid related to net share settlement of equity awards	(11,342)	(5,926)	(3,793)
Excess tax benefits from stock-based compensation	447
Net cash provided by (used in) financing activities	(304,347)	645,605	190,477
Net change in Cash and Cash Equivalents	16,972	5,238	2,410
Cash and Cash Equivalents-Beginning of Year	86,496	81,258	78,848
Cash and Cash Equivalents-End of Year	103,468	86,496	81,258
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Build-out allowances received from landlords		1,888
Purchase of property and equipment and internal-use software, accrued but not paid	667	607	210
Supplemental Disclosure of Cash Flow Information
Cash paid for income taxes, net of refunds	$ 28	$ 3	$ 162

Organization and Description of Business	12 Months Ended
Organization and Description of Business	Jun. 30, 2017
Organization and Description of Business
Organization and Description of Business	(1) Organization and Description of Business Paylocity Holding Corporation (the “Company”), through its wholly owned subsidiary, Paylocity Corporation, is a cloud-based provider of payroll and human capital management software solutions for medium-sized organizations. Services are provided in a Software-as-a-Service (“SaaS”) delivery model utilizing the Company’s cloud-based platform. Payroll services include collection, remittance and reporting of payroll liabilities to the appropriate federal, state and local authorities.

Summary of Significant Accounting Policies

12 Months Ended

Jun. 30, 2017

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. Significant items subject to such estimates and assumptions include the allowance for doubtful accounts, internal-use software, valuation and useful lives of long-lived assets, definite-lived intangibles, goodwill, incurred but not reported medical and dental claims, stock-based compensation, valuation of net deferred income tax assets and the best estimate of selling price for revenue recognition purposes. 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 reflect the financial position and operating results of Paylocity Holding Corporation and include its wholly owned subsidiary Paylocity Corporation. Intercompany accounts and transactions have been eliminated in consolidation.

(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, 100% 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) 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 statements of cash flows. The Company maintains an allowance for doubtful accounts reflecting estimated potential 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 doubtful accounts 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 doubtful accounts was as follows:


	For the Years Ended June 30,
	2015		2016		2017
Balance at the beginning of the year	$	126	$	149	$	193
Charged to expense		90		159		113
Write-offs		(67)		(115)		(40)
Balance at the end of the year	$	149	$	193	$	266

(e) Prepaid Expenses and Other Assets

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

(f) Capitalized Internal-Use Software

The Company applies Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 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 application 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-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.

(g) 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.

(h) Intangible Assets, Net of Accumulated Amortization

Intangible assets are comprised primarily of client list acquisitions and are reported net of accumulated amortization on the consolidated balance sheets. Client relationships use the straight-line method of amortization over a nine-year time frame from the date of acquisition, while non-solicitation agreements use the straight-line method of amortization over the lives 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.

(i) 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. As described in Note 5, the Company has recorded goodwill in connection with the acquisitions of certain assets of BFKMS, Inc. and Synergy Payroll, LLC. Goodwill is not amortized, but instead is tested for impairment at least annually in the fourth quarter. ASU 2011-08, Testing Goodwill for Impairment provides an entity the option to perform a qualitative assessment to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount prior to performing the two-step impairment test. If the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount, the two-step goodwill impairment test is required. Otherwise, no further analysis is required.

If the two-step goodwill impairment test is required, the fair value of the reporting unit is compared with its carrying amount, including goodwill. If the fair value of the reporting unit is less than its carrying amount, an indication of goodwill impairment exists for the reporting unit. In the second step, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of the goodwill. The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation and the residual fair value after this allocation is the implied fair value of the reporting unit goodwill. Fair value of the reporting unit is determined using a discounted cash flow analysis. In the event the fair value of the reporting unit exceeds its carrying amount, step two is not performed.

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 2015, 2016 or 2017 as a result of the Company’s qualitative assessments over its single reporting segment.

(j) Deferred Rent

The Company has operating lease agreements for its office space, which contain provisions for future rent increases, periods of rent abatement and build-out allowances. The Company records monthly rent expense for each lease equal to the total payments due over the lease term, divided by the number of months of the lease term. Build-out allowances are recorded as part of leasehold improvements and the incentive is amortized over the lease term against depreciation. The difference between recorded rent expense and the amount paid is included in “Accrued expenses” and as “Deferred rent” in the accompanying consolidated balance sheets.

(k) 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.

Valuation allowances are provided when necessary to reduce deferred tax assets to the amount more likely than not to be realized. Significant 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 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. The Company records interest and penalties as an element of income tax expense.

Refer to Note 11 for additional information on income taxes.

(l) Revenue Recognition

The Company recognizes revenue in accordance with ASC 605-25, Revenue Recognition—Multiple Element Arrangements, Accounting Standards Update No. 2009-13, Multiple-Deliverable Revenue Arrangements (“ASU 2009‑13”), and Staff Accounting Bulletin 104, Revenue Recognition. Revenue is recognized when there is persuasive evidence that an arrangement exists, delivery has occurred, the fee is fixed or determinable and collection of the revenue is probable.

The Company derives its revenue predominantly from recurring fees and non-recurring service fees. Recurring fees are collected under agreements for payroll, timekeeping, HR-related cloud-based computing services and monthly time clock rentals, all of which are generally cancellable by the client on 60 days’ notice or less. Non-recurring service fees consist mainly of implementation and custom reporting services. Such fees are billed to clients and revenue is recorded upon completion of the service. The Company’s agreements do not include general rights of return and do not provide clients with the right to take possession of the software supporting the services being provided. As such, the agreements are accounted for as service contracts.

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

Most multiple-element arrangements include a short implementation services phase, which involves establishing the client within and loading data into the Company’s cloud-based applications. Major recurring fees included in multiple-element arrangements include:

Payroll processing and related services, including payroll reporting and tax filing services 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, delivered on a monthly basis, and

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

For each agreement, the Company evaluates whether the individual deliverables qualify as separate units of accounting. If one or more of the deliverables does not have standalone value upon delivery, the deliverables that do not have standalone value are generally combined and treated as a single unit of accounting by frequency of occurrence for the product category involved such as biweekly payroll or monthly timekeeping services. Revenues for arrangements treated as a single unit of accounting are generally recognized within the same month that the services are rendered given that the agreements are cancellable with 60 days’ or less notice.

In determining whether implementation services can be accounted for separately from recurring revenues, the Company considers the nature of the implementation services and the availability of the implementation services from other vendors. The Company was able to establish standalone value for implementation activities based on the historical activity of third-party vendors that performed these services and as such, accounts for such implementation services separate from the recurring revenues.

If the recurring services have standalone value upon delivery, the Company accounts for each separately and revenues are recognized as services are delivered with allocation of consideration based on the relative selling price method as established in ASU 2009-13. That method requires the selling price of each element in a multiple-deliverable arrangement to be based on, in descending order: (i) vendor specific objective evidence of fair value (“VSOE”), (ii) third-party evidence of fair value (“TPE”) or (iii) management’s best estimate of the selling price (“BESP”).

The Company is not able to establish VSOE because the deliverables are sold across an insufficiently narrow range of prices on a stand-alone basis and is also not able to establish TPE because no third-party offerings are reasonably comparable to the Company’s offerings. The Company thus established its BESP by service offering, requiring the use of significant estimates and judgment. The Company considers numerous factors, including the nature of the deliverables themselves; the geography of the sale; and pricing and discounting practices utilized by the Company’s sales force. Arrangement consideration is allocated to each deliverable based on the established BESP and subject to the limitation that because the arrangements are cancellable with 60 days’ or less notice, recurring revenue is not allocated to any deliverable until the consideration has been earned, typically with each payroll cycle or monthly, depending on the service.

Revenues generated from sales through partners or utilizing partner services are recognized in accordance with the appropriate accounting guidance of ASC 605-45, Principal Agent Considerations. The Company reports revenue generated through partners or utilizing partner services at the gross amount billed to clients when (i) the Company is the primary obligor, (ii) the Company has latitude to establish the price charged and (iii) the Company bears the credit risk in the transaction.

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.

(m) Cost of Revenues

Cost of revenues consists primarily of the cost of recurring revenues and implementation services, which are expensed when incurred. Cost of revenues for recurring revenues consists primarily of costs to provide recurring services and support to the Company’s clients, and includes amortization of capitalized internal-use software. Cost of revenues for implementation services and other consists primarily of costs to provide implementation and other services.

(n) Advertising

Advertising costs are expensed as incurred. Advertising costs amounted to $187, $219 and $199 for the years ended June 30, 2015, 2016 and 2017, respectively.

(o) 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. The Company estimates grant date fair value using the Black-Scholes option-pricing model and periodically updates the assumed forfeiture rates for actual experience over their vesting term or the term of the ESPP purchase period.

(p) 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.

(q) 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 cloud-based software solution reporting segment.

(r) Recently Issued Accounting Standards

In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 supersedes a majority of existing revenue recognition guidance under US GAAP, and requires companies to recognize revenue when it transfers goods or services to a customer in an amount that reflects the consideration to which a company expects to be entitled. Companies may need to apply more judgment and estimation techniques or methods while recognizing revenue, which could result in additional disclosures to the financial statements. In addition, in March 2016, April 2016, May 2016 and December 2016 the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (“ASU 2016-08”), ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing (“ASU 2016-10”), ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (“ASU 2016-12”) and ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers (“ASU 2016-20”), respectively, to amend certain guidance in ASU 2014-09. Topic 606 allows for either a retrospective or cumulative effect transition method. ASU 2014-09 was originally effective for fiscal years beginning after December 15, 2016. In July 2015, the FASB approved a one-year deferral of ASU 2014-09 and all amendments to it, with a new effective date for fiscal years beginning after December 15, 2017 with early adoption permitted as of the original effective date.

The Company currently expects to adopt the new standard in its fiscal year beginning July 1, 2018 and is evaluating adoption methods. While the impact the new revenue recognition standard will have on its consolidated financial statements and disclosures has not yet been fully assessed, the Company currently expects that there will be a material impact in the manner in which it treats certain costs of obtaining new contracts (i.e., selling and commission costs). The new standard will require the Company to defer these costs and amortize them versus expensing these costs as incurred. The Company is continuing to evaluate all potential impacts as well as the changes required for systems, processes and internal controls to meet the new standard’s reporting and disclosure requirements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”) which amends various aspects of existing guidance for leases. ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease with terms greater than twelve months, along with additional qualitative and quantitative disclosures. ASU 2016-02 also requires the use of the modified retrospective method, which will require adjustment to all comparative periods presented. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is currently assessing the potential effects of these changes to its consolidated financial statements and is evaluating the timing of adoption.

In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718) (“ASU 2016-09”) which modifies accounting for excess tax benefits and tax deficiencies, forfeitures, and employer tax withholding requirements. ASU 2016-09 also clarifies certain classifications on the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, with early adoption permitted. The Company adopted this standard effective July 1, 2017. Due to the Company’s tax valuation allowance, it does not expect the portions of the updated standard that relate to excess tax benefits and deficiencies to have a material impact on the Consolidated Financial Statements and disclosures. Additionally, the Company will continue to estimate forfeitures at each reporting period, rather than electing an accounting policy change to record the impact of such forfeitures as they occur.

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.

Funds Held for Clients and Client Fund Obligations 10K	12 Months Ended
Funds Held for Clients and Client Fund Obligations 10K	Jun. 30, 2017
Funds Held for Clients and Client Fund Obligations
Funds Held for Clients and Client Fund Obligations	(3) Funds Held for Clients 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. Funds held for clients are held in demand deposit and money market accounts at major financial institutions. 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. 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.

Fair Value Measurements

12 Months Ended

Jun. 30, 2017

Fair Value Measurement

Fair Value Measurement

(4) Fair Value Measurements

The Company applies the fair value measurement and disclosure provisions of ASC 820, Fair Value Measurements and Disclosures, and ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. 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.

Substantially all of the Company’s assets that are measured at fair value on a recurring basis are measured using Level 1 inputs. The Company considers the recorded value of its financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, funds held for clients, accounts payable and client fund obligations to approximate the fair value of the respective assets and liabilities at June 30, 2016 and 2017 based upon the short-term nature of these assets and liabilities.

- 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, 2017

Business Combinations

Business Combinations

(5) Business Combinations

The Company had agreements with two resellers. The Company, under the revenue sharing provisions of the terminated reseller agreements, paid $2,495 to BFKMS Inc. during fiscal year 2014, and $2,081 and $2,361 to Synergy Payroll, LLC during fiscal years 2014 and 2015, respectively. The reseller agreements provided that the Company was required to acquire the assets of the resellers upon termination of the agreements. The following acquisitions were accounted for as a business combination in accordance with ASC 805, Business Combinations. The Company recorded the acquisitions using the acquisition method of accounting and recognized assets at their fair value as of the date of acquisition.

In May 2014, the Company acquired certain assets sufficient to sell the Company’s products in the Southern California marketplace upon the termination of its reseller agreement with BFKMS Inc. The total consideration paid for the acquisition was $9,435, of which $6,450 and $2,985 was paid during the years ended June 30, 2014 and 2015, respectively. The following table summarizes the fair value of the assets acquired at the date of acquisition:


	At May 23, 2014
Intangible assets	$	6,400
Goodwill		3,035
Total purchase price	$	9,435

The $6,400 of amortizable intangible assets consists of $6,180 in client relationships and $220 in a non-solicitation agreement. Goodwill will be amortized over a period of 15 years for income tax purposes.

In April 2015, the Company acquired certain assets sufficient to sell the Company’s products in the State of New Jersey marketplace upon the termination of its reseller agreement with Synergy Payroll, LLC, as part of the Company’s strategy of simplifying its sales channels. The total consideration for the acquisition was $9,508, of which $8,994 was paid at closing. The Company paid $483 during fiscal year 2016, which was net of adjustments in accordance with the asset purchase agreement. The following table summarizes the fair value of the assets acquired at the date of acquisition:


	At April 16, 2015
Intangible assets	$	6,540
Goodwill		2,968
Total purchase price	$	9,508

The $6,540 of amortizable intangible assets consists of $6,400 in client relationships and $140 in non-solicitation agreements. Goodwill will be amortized over a period of 15 years for income tax purposes.

The balance of the acquired intangibles, net of amortization, is stated separately on the consolidated balance sheet. Direct costs related to the acquisition were recorded as general and administrative expense as incurred.

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Capitalized Internal-Use Software

12 Months Ended

Jun. 30, 2017

Capitalized Internal-Use Software.

Capitalized Internal-Use Software

(6) Capitalized Internal-Use Software

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


	Year ended June 30,
	2016		2017
Capitalized internal-use software	$	34,249	$	49,663
Accumulated amortization		(22,822)		(32,269)
Capitalized internal-use software, net	$	11,427	$	17,394

Amortization of capitalized internal-use software amounted to $2,606, $5,446 and $9,447 for the years ended June 30, 2015, 2016 and 2017, respectively and is included in Cost of Revenues—Recurring Revenues.

- Definition

The entire disclosure for research, development, and computer software activities, including contracts and arrangements to be performed for others and with federal government. Includes costs incurred (1) in a planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service, a new process or technique, or in bringing about a significant improvement to an existing product or process; or (2) to translate research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or the entity's use, during the reporting period charged to research and development projects, including the costs of developing computer software up to the point in time of achieving technological feasibility and in-process research and development acquired in a business combination consummated during the period.

+ References + Details

Property and Equipment

12 Months Ended

Jun. 30, 2017

Property and Equipment

Property and Equipment

(7) Property and Equipment

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


	Year ended June 30,
	2016		2017
Office equipment	$	2,528	$	3,591
Computer equipment		18,139		24,411
Furniture and fixtures		4,308		7,547
Software		5,059		4,954
Leasehold improvements		11,164		21,426
Time clocks rented by clients		4,046		4,240
Total		45,244		66,169
Accumulated depreciation		(18,457)		(25,413)
Property and equipment, net	$	26,787	$	40,756

Depreciation expense amounted to $5,084, $6,905 and $10,068 for the years ended June 30, 2015, 2016 and 2017, respectively.

Goodwill and Intangible Assets

12 Months Ended

Jun. 30, 2017

Goodwill and Intangible Assets

Goodwill and Intangible Assets

(8) Goodwill and Intangible Assets

Goodwill represents the excess of cost over the net tangible and identifiable intangible assets of acquired businesses. Goodwill amounts are not amortized, but rather tested for impairment at least annually in the fourth quarter. Identifiable intangible assets acquired in business combinations are recorded based on fair value at the date of acquisition and amortized over their estimated useful lives. See Note 5 for further information regarding the acquisitions completed in 2014 and 2015.

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



					Weighted
					Average
	Year ended June 30,				Useful
	2016		2017		Life
Client relationships	$	12,580	$	12,580	9 years
Non-solicitation agreements		360		360	2 - 3 years
Total		12,940		12,940
Accumulated amortization		(2,521)		(4,033)
Intangible assets, net	$	10,419	$	8,907

Amortization expense for acquired intangible assets was $919, $1,522 and $1,512 for the years ended June 30, 2015, 2016 and 2017, respectively. Future amortization expense for acquired intangible is as follows, as of June 30, 2017:


Year ending June 30,
2018	$	1,427
2019		1,398
2020		1,398
2021		1,398
2022		1,398
Thereafter		1,888
Total	$	8,907

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

Accrued Expenses

12 Months Ended

Jun. 30, 2017

Accrued Expenses

Accrued Expenses

(9) Accrued Expenses

The components of accrued expenses are as follows:


	Year ended June 30,
	2016		2017
Accrued payroll and personnel costs	$	21,658	$	25,131
Other		3,321		5,170
Total accrued expenses	$	24,979	$	30,301

Leases

12 Months Ended

Jun. 30, 2017

Leases

Leases

(10) Leases

The Company primarily leases office space in Illinois, California, Florida, Idaho, New Jersey, New Hampshire and New York under non-cancellable operating leases expiring on various dates from June 2018 through October 2032. The leases provide for increasing annual base rents and oblige the Company to fund 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 April 2018 through December 2021.

In June 2016, the Company entered into a lease for approximately 310 rentable square feet of office space located in Schaumburg, Illinois. The Company intends to use the leased premises as its headquarters upon the expiration of the lease of its current headquarters. The lease provides for phased delivery and commencement dates, with commencement expected to occur on the following approximate dates: Phase I (June 1, 2017), Phase II (November 1, 2017), Phase III (July 1, 2018), and Phase IV (July 1, 2019). The actual commencement dates are subject to timely delivery of the premises by the landlord. Under the terms of the lease, the Company will receive a tenant improvement allowance equal to $65.00 per rentable square foot and a 12-month rent abatement period for each lease phase. The lease also provides for a term beginning on the Phase I commencement date and ending 180 full calendar months after the landlord delivers the Phase II premises to the Company, which is expected to be on or about November 1, 2017, with two subsequent five-year renewal options.

In February 2017, the Company entered into a lease for approximately 62 rentable square feet of office space located in Meridian, Idaho. The Company intends to use the leased premises to accommodate the continued expansion of its employee base in the western region of the United States. The lease provides for phased delivery and commencement dates with commencement expected to occur on the following approximate dates: Phase I (July 1, 2018) and Phase II (February 1, 2020). The actual commencement dates are subject to timely delivery of the premises by the landlord. Under the terms of the lease, the Company will receive a tenant improvement allowance equal to $50.00 per rentable square foot and a 3-month rent abatement period for each lease phase. The lease also provides for a term beginning on the Phase I commencement date and ending after 120 full calendar months with four subsequent five-year renewal options.

Minimum rent payments under operating leases are recognized on a straight-line basis over the term of the lease including any periods of free rent and future rent increases. Rental expense for operating leases, including amortization of leasehold improvements, was $4,238, $5,596 and $8,571 for the years ended June 30, 2015, 2016 and 2017, respectively.

Future minimum lease payments under non-cancellable operating leases (with initial or remaining lease terms in excess of one year) as of June 30, 2017 are:


Year ending June 30,
2018	$	7,025
2019		8,354
2020		8,573
2021		9,677
2022		8,548
Later years, through 2033		75,161
Total minimum lease payments	$	117,338

Income Taxes

12 Months Ended

Jun. 30, 2017

Income Taxes

Income Taxes

(11) Income Taxes

(a) Income Taxes

Income tax expense for the years ended June 30, 2015, 2016 and 2017 consists of the following:


	Year ended June 30,
	2015		2016		2017
Current taxes
U.S. federal	$	—	$	—	$	—
State and local		14		27		500
Deferred taxes:
U.S. federal		83		136		137
State and local		8		14		14
Total income tax expense	$	105	$	177	$	651

(b) Tax Rate Reconciliation

Income tax expense differed from the amounts computed by applying the U.S. federal income tax rate of 34% to pretax income (loss) as a result of the following:


	Year ended June 30,
	2015		2016		2017
Income tax expense (benefit) at statutory federal rate	$	(4,716)	$	(1,249)	$	2,503
Increase (reduction) in income taxes resulting from:
Research and development credit, net of federal income tax benefit		(276)		(504)		(1,025)
Non-deductible expenses		418		557		685
Change in valuation allowance		4,570		2,590		(1,349)
State and local income taxes, net of federal income tax benefit		(562)		(432)		(196)
Other		671		(785)		33
	$	105	$	177	$	651

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at June 30, 2016 and 2017 are presented below.


	Year ended June 30,
	2016		2017
Deferred tax assets:
Deferred rent	$	694	$	1,090
Allowance for doubtful accounts		73		100
Accrued expenses		1,812		2,290
Stock-based compensation		7,367		11,034
Net operating loss carryforwards		4,498		253
Research and development and other credits		3,236		4,984
AMT Credits		11		29
Intangible assets		413		657
Total deferred tax assets		18,104		20,437
Valuation allowance		(10,038)		(8,689)
Net deferred tax assets		8,066		11,748
Deferred tax liabilities:
Research and development costs		(3,681)		(5,649)
Prepaid expenses		(91)		—
Depreciation		(4,543)		(6,500)
Total deferred liabilities		(8,315)		(12,149)
Net deferred tax liability	$	(249)	$	(401)

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized through the generation of future taxable income. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income and tax-planning strategies in making this assessment. Taxable loss for the years ended June 30, 2015, 2016 and 2017 was approximately $12,424, $8,330 and $3,294, respectively, prior to utilization or establishment of net operating loss carryforwards. Based upon the same three-year period pre-tax book income, the Company is in a three-year cumulative loss position. As a result of this and other assessments in the year ended June 30, 2017, management concluded that a full valuation allowance is required for all deferred tax assets except for those associated with indefinite-lived intangible assets.

At June 30, 2017, the Company has gross excess tax benefits from stock option exercises of approximately $30,264 for federal and state income tax purposes. At June 30, 2017, the Company has net operating loss carryforwards for federal income tax purposes of approximately $484 and state income tax purposes of approximately $1,777, both excluding the excess tax benefits from stock option exercises noted above. The net tax impact of $10,290 and $644 for federal and state income tax purposes, respectively, related to the excess tax benefits from stock option exercises will be credited to additional paid-in capital when realized. The federal NOL carryforwards expire from 2030 to 2037.The state NOL carryforwards expire from 2020 to 2037. The Company also has gross federal and state research and development tax credit and other state credit carryforwards of approximately $4,984, which expire between 2018 and 2037. In addition, the Company has alternative minimum tax credit carryforwards of approximately $11, which are available to reduce future federal regular income taxes, if any, over an indefinite period.

The Company had no unrecognized tax benefits as of June 30, 2015, 2016 and 2017, respectively.

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 subsidiary, files a consolidated federal income tax return. For years before 2013 (fiscal year ended June 30, 2014), 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 2013 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.

Stockholders' Equity	12 Months Ended
Stockholders' Equity	Jun. 30, 2017
Stockholders' Equity
Stockholders' Equity	(12) 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.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 30
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644

Reference 16: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644

+ Details

Benefit Plans

12 Months Ended

Jun. 30, 2017

Benefit Plans

Benefit Plans

(13) 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 options to purchase common stock and other equity incentives at the discretion of the compensation committee of the Company’s board of directors. 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 will increase automatically each calendar year, continuing through and including January 1, 2024 (“Evergreen provision”). The number of shares added each year will 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 determined that, effective January 1, 2017, it would increase the number of common shares in reserve for issuance under the 2014 Plan by 2,314 shares.

As of June 30, 2017, the Company had 12,433 shares allocated to the plans, of which 4,206 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 changes during the year ended June 30, 2017 in the number of shares available for grant under the Company’s equity incentive plans:


		Number of Shares
Available for grant at July 1, 2016		6,244
January 1, 2017 Evergreen provision increase		2,314
RSUs granted		(774)
Shares withheld in settlement of taxes and/or exercise price		467
Forfeitures		89
Shares removed		(113)
Available for grant at June 30, 2017		8,227

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”), and the Employee Stock Purchase Plan (as described below) is included in the following line items in the accompanying audited consolidated statements of operations:


	Year ended June 30,
	2015		2016		2017
Cost of revenue – recurring	$	1,532	$	1,648	$	2,162
Cost of revenue – non-recurring		1,222		1,127		1,357
Sales and marketing		3,247		4,441		6,287
Research and development		2,533		2,789		3,086
General and administrative		4,635		7,558		13,842
Total stock-based compensation expense	$	13,169	$	17,563	$	26,734

In addition, the Company capitalized $655, $1,078 and $1,773 of stock-based compensation costs in its internal-use software in the years ended June 30, 2015, 2016 and 2017, respectively.

In June 2017, Peter McGrail ceased to serve as the Company’s Chief Financial Officer, but continued to serve as an employee of the Company. In connection with Mr. McGrail’s modified employment arrangement, the compensation committee of the Board of Directors approved modifications to terms of the unvested equity awards granted to Mr. McGrail. Any awards held by Mr. McGrail that are subject to time-based vesting will become fully-vested upon his death or disability. Additionally, any performance-based restricted stock unit (“PSU”) awards held by Mr. McGrail will continue to vest and settle based upon actual achievement of previously-established performance metrics, with Mr. McGrail receiving a pro-rata share of the PSU awards based on the number of days Mr. McGrail is employed over the vesting period. As a result of these award modifications, the Company recognized $2,925 in additional stock-based compensation expense for the fiscal year ended June 30, 2017, which was included in general and administrative expense in the Company’s consolidated statements of operations.

Under the 2008 and 2014 Plans, the exercise price of each option cannot be less than the fair value of a share of common stock on the grant date. The options typically vest ratably over a three or four year period and expire 10 years from the grant date. Stock-based compensation expense for the fair value of the options at their grant date is recognized ratably over the vesting schedule for each separately vesting portion of the award.

The Company values stock options using the Black-Scholes option-pricing model, which requires the input of subjective assumptions, including the risk-free interest rate, expected life, expected stock price volatility and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for U.S. Treasury securities consistent with the expected term of the Company’s employee stock options. The expected life represents the period of time the stock options are expected to be outstanding and is based on the simplified method. Under the simplified method, the expected life of an option is presumed to be the mid-point between the vesting date and the end of the contractual term. As the Company has a limited history of trading as a public company, the Company utilizes the simplified method due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected life of the stock options. Therefore, the expected volatility is based on historical volatilities for publicly traded stock of comparable companies over the estimated expected life of the stock options. The Company assumed no dividend yield because it does not expect to pay dividends in the near future, which is consistent with the Company’s history of not paying dividends.

There were no stock options granted during the year ended June 30, 2017. The following table summarizes the assumptions used for estimating the fair value of stock options granted for the years ended June 30:


	Year ended June 30,
	2015	2016
Valuation assumptions:
Expected dividend yield	0%	0%
Expected volatility	43.9%	34.0%
Expected term (years)	6.25	6.25
Risk-free interest rate	1.91%	1.83%

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, 2016	3,464	$	11.75	6.70	$	108,944
Options forfeited	(22)	$	18.88
Options exercised	(691)	$	12.37
Balance at June 30, 2017	2,751	$	11.54	5.69	$	92,556
Options exercisable at June 30, 2017	2,395	$	9.80	5.47	$	84,757
Options vested and expected to vest at June 30, 2017	2,742	$	11.47	5.68	$	92,414

There were no stock options granted during the year ended June 30, 2017. The weighted average grant date fair value of options granted during the years ended June 30, 2015 and 2016 was $11.14 and $12.92, respectively. The total intrinsic value of options exercised during the years ended June 30, 2015, 2016 and 2017 was $8,802, $13,362 and $20,802, respectively. At June 30, 2017, there was $625 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options granted. That cost is expected to be recognized over a weighted average period of 1.36 years.

The following table summarizes information about stock options outstanding and stock options exercisable at June 30, 2017:


	Options Outstanding				Options Exercisable
Price Range	Number of shares	Weighted average remaining contractual term	Weighted average exercise price		Number of shares	Weighted average exercise price
$1.31 to $3.58	463	3.15	$	1.49	463	$	1.49
$3.59 to $5.96	854	5.14	$	4.88	854	$	4.88
$5.97 to $12.02	224	6.03	$	7.04	128	$	7.04
$12.03 to $20.90	796	6.72	$	17.00	796	$	17.00
$20.91 to $35.28	414	7.48	$	28.46	154	$	27.16
Total	2,751	5.69	$	11.54	2,395	$	9.80

The Company may also grant RSUs under the 2014 Plan with terms determined at the discretion of the compensation committee of the Company’s board of directors. 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 metrics in future fiscal years. The following table represents restricted stock unit activity during the year ended June 30, 2017:


	Units	Weighted average grant date fair value
RSU balance at July 1, 2016	1,003	$	32.74
RSUs granted	774	$	45.66
RSUs vested	(255)	$	32.97
RSUs forfeited	(67)	$	38.09
RSU balance at June 30, 2017	1,455	$	39.96
RSUs expected to vest at June 30, 2017	1,269	$	39.59

At June 30, 2017, there was $20,599 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 1.89 years.

The total excess income tax benefits for stock-based compensation arrangements was $5,562, $8,228 and $15,130 for the years ended June 30, 2015, 2016 and 2017, respectively. As described in Note 2, the Company will adopt ASU 2016-09 as of July 1, 2017. As a result, in the future, the Company will recognize these tax benefits through income tax expense instead of additional paid-in capital as required under current GAAP.

(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, 2017, a total of 824 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 will increase automatically each calendar year, continuing through and including January 1, 2024. The number of shares added each year will 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. For fiscal year 2017, the Company’s board of directors determined that it would not increase the number of common shares reserved for issuance under the ESPP.

The Company issued a total of 127 shares upon the completion of its six-month offering periods ending November 15, 2016 and May 15, 2017. The Company recorded compensation expense attributable to the ESPP of $656, $1,069 and $1,263 for the years ended June 30, 2015, 2016 and 2017, 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,
	2015	2016	2017
Valuation assumptions:
Expected dividend yield	0%	0%	0%
Expected volatility	35.5 - 48.4%	44.1 - 53.4%	38.9 - 53.4%
Expected term (years)	0.3 - 0.5	0.5	0.5
Risk‑free interest rate	0.04 - 0.11%	0.11 - 0.31%	0.28 - 1.02%

The Company maintains a 401(k) plan with a safe harbor matching provision that covers all eligible employees. Up to December 31, 2015, the Company matched 50% of the employees’ contributions up to 6% of their gross pay. Effective January 1, 2016, the Company increased its match to 50% of employees’ contributions up to 8% of their gross pay. Contributions were $1,656, $2,717 and $3,667 for the years ended June 30, 2015, 2016 and 2017, respectively.

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Jun. 30, 2017
Commitments and Contingencies
Commitments and Contingencies	(14) Commitments and Contingencies (a) Employment Agreements The Company has employment agreements with certain of its key officers. The agreements allow for minimum 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 From time to time, the Company is subject to litigation arising in the ordinary course of business. Many of these proceedings 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.

Earnings Per Share

12 Months Ended

Jun. 30, 2017

Net Loss Per Share

Net Income Per Share

(15) Earnings Per Share

Basic net income (loss) per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net income (loss) 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 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 (loss) per share:


	Year ended June 30,
	2015		2016		2017
Numerator:
Net income (loss)	$	(13,972)	$	(3,851)	$	6,718

Denominator:
Weighted-average shares used in computing net income (loss) per share:
Basic		50,127		50,913		51,415
Weighted-average effect of potentially dilutive shares:
Employee stock options and restricted stock units		—		—		2,642
Diluted		50,127		50,913		54,057

Net income (loss) per share:
Basic	$	(0.28)	$	(0.08)	$	0.13
Diluted	$	(0.28)	$	(0.08)	$	0.12

The following table summarizes the outstanding employee stock options, restricted stock units and employee stock purchase plan shares 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,
	2015	2016	2017

Employee stock options	3,956	3,464	145
Restricted stock units	386	1,003	627
Employee stock purchase plan shares	13	15	14
Total	4,355	4,482	786

Selected Quarterly Financial Data (unaudited)

12 Months Ended

Jun. 30, 2017

Selected Quarterly Financial Data (unaudited)

Selected Quarterly Financial Data (unaudited)

(16) Selected Quarterly Financial Data (unaudited)

The following tables set forth selected unaudited quarterly statements of operations data for each of the eight quarters in the years ended June 30, 2016 and 2017.


	Quarter Ended
	September 30,		December 31,
	2015		2015		March 31, 2016		June 30, 2016
Consolidated Statements of Operations Data
Revenues	$	45,108	$	55,184	$	70,570	$	59,839
Gross profit	$	24,913	$	31,084	$	43,361	$	33,258
Operating income (loss)	$	(3,417)	$	(1,294)	$	6,201	$	(5,040)
Net income (loss)	$	(3,435)	$	(1,165)	$	6,161	$	(5,412)
Net income (loss) per share:
Basic	$	(0.07)	$	(0.02)	$	0.12	$	(0.11)
Diluted	$	(0.07)	$	(0.02)	$	0.12	$	(0.11)
Weighted-average shares used in computing net income (loss) per share:
Basic		50,744		50,890		50,962		51,058
Diluted		50,744		50,890		53,424		51,058


	Quarter Ended
	September 30,		December 31,
	2016		2016		March 31, 2017		June 30, 2017
Consolidated Statements of Operations Data
Revenues	$	65,022	$	68,654	$	90,273	$	76,061
Gross profit	$	36,663	$	38,271	$	58,191	$	42,898
Operating income (loss)	$	(2,507)	$	(1,643)	$	14,880	$	(3,434)
Net income (loss)	$	(2,568)	$	(1,671)	$	14,801	$	(3,844)
Net income (loss) per share:
Basic	$	(0.05)	$	(0.03)	$	0.29	$	(0.07)
Diluted	$	(0.05)	$	(0.03)	$	0.27	$	(0.07)
Weighted-average shares used in computing net income (loss) per share:
Basic		51,231		51,384		51,447		51,602
Diluted		51,231		51,384		54,002		51,602

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Jun. 30, 2017

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”).

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.

Accounts Receivable

(d) Accounts Receivable

Activity in the allowance for doubtful accounts was as follows:


	For the Years Ended June 30,
	2015		2016		2017
Balance at the beginning of the year	$	126	$	149	$	193
Charged to expense		90		159		113
Write-offs		(67)		(115)		(40)
Balance at the end of the year	$	149	$	193	$	266

Prepaid Expenses and Other Assets

(e) Prepaid Expenses and Other Assets

Capitalized Internal-Use Software

(f) Capitalized Internal-Use Software

Property and Equipment and Long-Lived Assets

(g) Property and Equipment and Long-Lived Assets

Intangible Assets, Net of Accumulated Amortization

(h) Intangible Assets, Net of Accumulated Amortization

Goodwill

(i) Goodwill

Deferred Rent

(j) Deferred Rent

Income Taxes

(k) Income Taxes

Refer to Note 11 for additional information on income taxes.

Revenue Recognition

(l) Revenue Recognition

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

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

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.

Cost of Revenues

(m) Cost of Revenues

Advertising

(n) Advertising

Advertising costs are expensed as incurred. Advertising costs amounted to $187, $219 and $199 for the years ended June 30, 2015, 2016 and 2017, respectively.

Stock-Based Compensation

(o) Stock-Based Compensation

Commitments and Contingencies

(p) Commitments and Contingencies

Segment Information

(q) Segment Information

Recently Issued Accounting Standards

(r) Recently Issued Accounting Standards

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Jun. 30, 2017

Summary of Significant Accounting Policies

Schedule of activity in allowance for doubtful accounts


	For the Years Ended June 30,
	2015		2016		2017
Balance at the beginning of the year	$	126	$	149	$	193
Charged to expense		90		159		113
Write-offs		(67)		(115)		(40)
Balance at the end of the year	$	149	$	193	$	266

Business Combinations (Tables)

12 Months Ended

Jun. 30, 2017

BFKMS Inc

Summary of fair value of the assets acquired at the date of acquisition


	At May 23, 2014
Intangible assets	$	6,400
Goodwill		3,035
Total purchase price	$	9,435

Synergy Payroll LLC

Summary of fair value of the assets acquired at the date of acquisition


	At April 16, 2015
Intangible assets	$	6,540
Goodwill		2,968
Total purchase price	$	9,508

Capitalized Internal-Use Software (Tables)

12 Months Ended

Jun. 30, 2017

Capitalized Internal-Use Software.

Schedule of capitalized internal-use software and accumulated amortization


	Year ended June 30,
	2016		2017
Capitalized internal-use software	$	34,249	$	49,663
Accumulated amortization		(22,822)		(32,269)
Capitalized internal-use software, net	$	11,427	$	17,394

Property and Equipment (Tables)

12 Months Ended

Jun. 30, 2017

Property and Equipment

Schedule of property and equipment


	Year ended June 30,
	2016		2017
Office equipment	$	2,528	$	3,591
Computer equipment		18,139		24,411
Furniture and fixtures		4,308		7,547
Software		5,059		4,954
Leasehold improvements		11,164		21,426
Time clocks rented by clients		4,046		4,240
Total		45,244		66,169
Accumulated depreciation		(18,457)		(25,413)
Property and equipment, net	$	26,787	$	40,756

Goodwill and Intangible Assets (Tables)

12 Months Ended

Jun. 30, 2017

Goodwill and Intangible Assets

Schedule of amortizable intangible assets before amortization expense



					Weighted
					Average
	Year ended June 30,				Useful
	2016		2017		Life
Client relationships	$	12,580	$	12,580	9 years
Non-solicitation agreements		360		360	2 - 3 years
Total		12,940		12,940
Accumulated amortization		(2,521)		(4,033)
Intangible assets, net	$	10,419	$	8,907

Schedule of future amortization expense for acquired intangible assets


Year ending June 30,
2018	$	1,427
2019		1,398
2020		1,398
2021		1,398
2022		1,398
Thereafter		1,888
Total	$	8,907

Accrued Expenses (Tables)

12 Months Ended

Jun. 30, 2017

Accrued Expenses

Schedule of components of accrued expenses


	Year ended June 30,
	2016		2017
Accrued payroll and personnel costs	$	21,658	$	25,131
Other		3,321		5,170
Total accrued expenses	$	24,979	$	30,301

Leases (Tables)

12 Months Ended

Jun. 30, 2017

Leases

Schedule of future minimum lease payments under non-cancellable operating leases


Year ending June 30,
2018	$	7,025
2019		8,354
2020		8,573
2021		9,677
2022		8,548
Later years, through 2033		75,161
Total minimum lease payments	$	117,338

Income Taxes (Tables)

12 Months Ended

Jun. 30, 2017

Income Taxes

Schedule of income tax expense


	Year ended June 30,
	2015		2016		2017
Current taxes
U.S. federal	$	—	$	—	$	—
State and local		14		27		500
Deferred taxes:
U.S. federal		83		136		137
State and local		8		14		14
Total income tax expense	$	105	$	177	$	651

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


	Year ended June 30,
	2015		2016		2017
Income tax expense (benefit) at statutory federal rate	$	(4,716)	$	(1,249)	$	2,503
Increase (reduction) in income taxes resulting from:
Research and development credit, net of federal income tax benefit		(276)		(504)		(1,025)
Non-deductible expenses		418		557		685
Change in valuation allowance		4,570		2,590		(1,349)
State and local income taxes, net of federal income tax benefit		(562)		(432)		(196)
Other		671		(785)		33
	$	105	$	177	$	651

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,
	2016		2017
Deferred tax assets:
Deferred rent	$	694	$	1,090
Allowance for doubtful accounts		73		100
Accrued expenses		1,812		2,290
Stock-based compensation		7,367		11,034
Net operating loss carryforwards		4,498		253
Research and development and other credits		3,236		4,984
AMT Credits		11		29
Intangible assets		413		657
Total deferred tax assets		18,104		20,437
Valuation allowance		(10,038)		(8,689)
Net deferred tax assets		8,066		11,748
Deferred tax liabilities:
Research and development costs		(3,681)		(5,649)
Prepaid expenses		(91)		—
Depreciation		(4,543)		(6,500)
Total deferred liabilities		(8,315)		(12,149)
Net deferred tax liability	$	(249)	$	(401)

Benefit Plans (Tables)

12 Months Ended

Jun. 30, 2017

Benefit Plans

Summary of shares available for grant under our equity incentive plans


		Number of Shares
Available for grant at July 1, 2016		6,244
January 1, 2017 Evergreen provision increase		2,314
RSUs granted		(774)
Shares withheld in settlement of taxes and/or exercise price		467
Forfeitures		89
Shares removed		(113)
Available for grant at June 30, 2017		8,227

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


	Year ended June 30,
	2015		2016		2017
Cost of revenue – recurring	$	1,532	$	1,648	$	2,162
Cost of revenue – non-recurring		1,222		1,127		1,357
Sales and marketing		3,247		4,441		6,287
Research and development		2,533		2,789		3,086
General and administrative		4,635		7,558		13,842
Total stock-based compensation expense	$	13,169	$	17,563	$	26,734

Summary of the assumptions used for estimating the fair value of stock options granted


	Year ended June 30,
	2015	2016
Valuation assumptions:
Expected dividend yield	0%	0%
Expected volatility	43.9%	34.0%
Expected term (years)	6.25	6.25
Risk-free interest rate	1.91%	1.83%

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, 2016	3,464	$	11.75	6.70	$	108,944
Options forfeited	(22)	$	18.88
Options exercised	(691)	$	12.37
Balance at June 30, 2017	2,751	$	11.54	5.69	$	92,556
Options exercisable at June 30, 2017	2,395	$	9.80	5.47	$	84,757
Options vested and expected to vest at June 30, 2017	2,742	$	11.47	5.68	$	92,414

Schedule of stock options outstanding and stock options exercisable


	Options Outstanding				Options Exercisable
Price Range	Number of shares	Weighted average remaining contractual term	Weighted average exercise price		Number of shares	Weighted average exercise price
$1.31 to $3.58	463	3.15	$	1.49	463	$	1.49
$3.59 to $5.96	854	5.14	$	4.88	854	$	4.88
$5.97 to $12.02	224	6.03	$	7.04	128	$	7.04
$12.03 to $20.90	796	6.72	$	17.00	796	$	17.00
$20.91 to $35.28	414	7.48	$	28.46	154	$	27.16
Total	2,751	5.69	$	11.54	2,395	$	9.80

Schedule of restricted stock unit activity


	Units	Weighted average grant date fair value
RSU balance at July 1, 2016	1,003	$	32.74
RSUs granted	774	$	45.66
RSUs vested	(255)	$	32.97
RSUs forfeited	(67)	$	38.09
RSU balance at June 30, 2017	1,455	$	39.96
RSUs expected to vest at June 30, 2017	1,269	$	39.59

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


	Year ended June 30,
	2015	2016	2017
Valuation assumptions:
Expected dividend yield	0%	0%	0%
Expected volatility	35.5 - 48.4%	44.1 - 53.4%	38.9 - 53.4%
Expected term (years)	0.3 - 0.5	0.5	0.5
Risk‑free interest rate	0.04 - 0.11%	0.11 - 0.31%	0.28 - 1.02%

Earnings Per Share (Tables)

12 Months Ended

Jun. 30, 2017

Net Loss Per Share

Schedule of calculation of basic net income (loss) per share


	Year ended June 30,
	2015		2016		2017
Numerator:
Net income (loss)	$	(13,972)	$	(3,851)	$	6,718

Denominator:
Weighted-average shares used in computing net income (loss) per share:
Basic		50,127		50,913		51,415
Weighted-average effect of potentially dilutive shares:
Employee stock options and restricted stock units		—		—		2,642
Diluted		50,127		50,913		54,057

Net income (loss) per share:
Basic	$	(0.28)	$	(0.08)	$	0.13
Diluted	$	(0.28)	$	(0.08)	$	0.12

Summary of anti-dilutive securities


	Year ended June 30,
	2015	2016	2017

Employee stock options	3,956	3,464	145
Restricted stock units	386	1,003	627
Employee stock purchase plan shares	13	15	14
Total	4,355	4,482	786

Selected Quarterly Financial Data (unaudited) (Tables)

12 Months Ended

Jun. 30, 2017

Selected Quarterly Financial Data (unaudited)

Schedule of selected unaudited quarterly statements of operations data


	Quarter Ended
	September 30,		December 31,
	2015		2015		March 31, 2016		June 30, 2016
Consolidated Statements of Operations Data
Revenues	$	45,108	$	55,184	$	70,570	$	59,839
Gross profit	$	24,913	$	31,084	$	43,361	$	33,258
Operating income (loss)	$	(3,417)	$	(1,294)	$	6,201	$	(5,040)
Net income (loss)	$	(3,435)	$	(1,165)	$	6,161	$	(5,412)
Net income (loss) per share:
Basic	$	(0.07)	$	(0.02)	$	0.12	$	(0.11)
Diluted	$	(0.07)	$	(0.02)	$	0.12	$	(0.11)
Weighted-average shares used in computing net income (loss) per share:
Basic		50,744		50,890		50,962		51,058
Diluted		50,744		50,890		53,424		51,058


	Quarter Ended
	September 30,		December 31,
	2016		2016		March 31, 2017		June 30, 2017
Consolidated Statements of Operations Data
Revenues	$	65,022	$	68,654	$	90,273	$	76,061
Gross profit	$	36,663	$	38,271	$	58,191	$	42,898
Operating income (loss)	$	(2,507)	$	(1,643)	$	14,880	$	(3,434)
Net income (loss)	$	(2,568)	$	(1,671)	$	14,801	$	(3,844)
Net income (loss) per share:
Basic	$	(0.05)	$	(0.03)	$	0.29	$	(0.07)
Diluted	$	(0.05)	$	(0.03)	$	0.27	$	(0.07)
Weighted-average shares used in computing net income (loss) per share:
Basic		51,231		51,384		51,447		51,602
Diluted		51,231		51,384		54,002		51,602

Summary of Significant Accounting Policies - Concentration of Risk, Accounts Receivable (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Accounts Receivable
Number of days past due before a balance will be reviewed for collectability	60 days
Activity in allowance for doubtful accounts
Balance at beginning of period	$ 193	$ 149	$ 126
Charged to expense	113	159	90
Write-offs	(40)	(115)	(67)
Balance at end of period	$ 266	$ 193	$ 149
Total Revenue \| Customer Concentration Risk \| Major Customer With Ten Percent Or More Of Benchmark [Member]
Concentrations of Risk
Percentage of total revenues	0.00%
Total Revenue \| Geographic Concentration Risk [Member] \| UNITED STATES
Concentrations of Risk
Percentage of total revenues	100.00%

Summary of Significant Accounting Policies - PP&E (Details)	12 Months Ended
	Jun. 30, 2017
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 10K (Details) $ in Thousands	12 Months Ended
	Jun. 30, 2017 USD ($) segment	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)
Goodwill and other intangible assets, net of accumulated amortization
Goodwill, Impairment Loss	$ 0	$ 0	$ 0
Revenue Recognition
Period of notice days given for cancellation of agreement	60 days
Advertising
Advertising costs	$ 199	$ 219	$ 187
Segment Information
Number of reporting segments \| segment	1
Capitalized Internal-Use Software
Goodwill and other intangible assets, net of accumulated amortization
Estimated useful lives	24 months
Client relationships
Goodwill and other intangible assets, net of accumulated amortization
Estimated useful lives	9 years

Funds Held for Clients and Client Fund Obligations (Details)	12 Months Ended
	Jun. 30, 2017
Funds Held for Clients and Client Fund Obligations
Period of repayment of client fund obligation liabilities	1 year

Business Combinations (Details) $ in Thousands			1 Months Ended		12 Months Ended
Business Combinations (Details) $ in Thousands	Apr. 16, 2015 USD ($)	May 23, 2014 USD ($)	Apr. 30, 2015 USD ($)	May 31, 2014 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)	Jun. 30, 2014 USD ($)	Jun. 30, 2017 USD ($)
Business Combinations
Number of reseller agreements prior to the termination of said agreements				2
Payments for acquisition					$ 483	$ 11,979
Goodwill					6,003			$ 6,003
BFKMS Inc
Business Combinations
Amount paid to reseller per terms of a reseller agreement							$ 2,495
Total consideration				$ 9,435
Payments for acquisition						2,985	6,450
Intangible assets		$ 6,400
Goodwill		3,035
Total purchase price		$ 9,435
Goodwill amortization period for income tax purposes		15 years
BFKMS Inc \| Client relationships
Business Combinations
Intangible assets		$ 6,180
BFKMS Inc \| Non Solicitation Agreement
Business Combinations
Intangible assets		$ 220
Synergy Payroll LLC
Business Combinations
Amount paid to reseller per terms of a reseller agreement						$ 2,361	$ 2,081
Total consideration			$ 9,508
Payments for acquisition	$ 8,994				$ 483
Intangible assets	6,540
Goodwill	2,968
Total purchase price	$ 9,508
Goodwill amortization period for income tax purposes	15 years
Synergy Payroll LLC \| Client relationships
Business Combinations
Intangible assets	$ 6,400
Synergy Payroll LLC \| Non Solicitation Agreement
Business Combinations
Intangible assets	$ 140

Capitalized Internal-Use Software (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Capitalized internal-use software and accumulated amortization
Capitalized internal-use software	$ 49,663	$ 34,249
Accumulated amortization	(32,269)	(22,822)
Capitalized internal-use software, net	17,394	11,427
Cost of revenue - recurring
Capitalized internal-use software and accumulated amortization
Amortization of capitalized internal-use software	$ 9,447	$ 5,446	$ 2,606

Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Property and equipment
Property and equipment, gross	$ 66,169	$ 45,244
Accumulated depreciation	(25,413)	(18,457)
Property and equipment, net	40,756	26,787
Depreciation expense	10,068	6,905	$ 5,084
Office equipment
Property and equipment
Property and equipment, gross	3,591	2,528
Computer equipment
Property and equipment
Property and equipment, gross	24,411	18,139
Furniture and fixtures
Property and equipment
Property and equipment, gross	7,547	4,308
Software
Property and equipment
Property and equipment, gross	4,954	5,059
Leasehold improvements
Property and equipment
Property and equipment, gross	21,426	11,164
Time clocks rented by clients
Property and equipment
Property and equipment, gross	$ 4,240	$ 4,046

Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Intangible Assets
Intangible assets	$ 12,940	$ 12,940
Accumulated amortization	(4,033)	(2,521)
Intangible assets, net	8,907	10,419
Amortization expense for acquired intangible assets	1,512	1,522	$ 919
Future amortization expense for acquired intangible assets
2018	1,427
2019	1,398
2020	1,398
2021	1,398
2022	1,398
Thereafter	1,888
Intangible assets, net	8,907	10,419
Client relationships
Intangible Assets
Intangible assets	$ 12,580	12,580
Useful life	9 years
Non-solicitation agreements
Intangible Assets
Intangible assets	$ 360	$ 360
Non-solicitation agreements \| Minimum
Intangible Assets
Useful life	2 years
Non-solicitation agreements \| Maximum
Intangible Assets
Useful life	3 years

Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016
Components of accrued expenses
Accrued payroll and personnel costs	$ 25,131	$ 21,658
Other	5,170	3,321
Total accrued expenses	$ 30,301	$ 24,979

Leases (Details) ft² in Thousands, $ in Thousands	1 Months Ended		12 Months Ended
Leases (Details) ft² in Thousands, $ in Thousands	Feb. 28, 2017 ft² Option $ / ft²	Jun. 30, 2016 ft² item $ / ft²	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($) ft² item	Jun. 30, 2015 USD ($)
Rental expense for operating leases			$ 8,571	$ 5,596	$ 4,238
Future minimum lease payments under non-cancellable operating leases
2018			7,025
2019			8,354
2020			8,573
2021			9,677
2022			8,548
Later years, through 2033			75,161
Total minimum lease payments			$ 117,338
Leased office space \| Schaumburg Lease
Area of lease \| ft²		310		310
Lease term		180 months
Tenant improvement allowance per rentable square foot \| $ / ft²		65.00
Rent abatement period per lease phase		12 months
Number of renewal options \| item		2		2
Renewal period		5 years
Leased office space \| Meridian Lease
Area of lease \| ft²	62
Lease term	120 months
Tenant improvement allowance per rentable square foot \| $ / ft²	50.00
Rent abatement period per lease phase	3 months
Number of renewal options \| Option	4
Renewal period	5 years

Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Current taxes
U.S. federal
State and local	500	27	14
Deferred taxes:
U.S. federal	137	136	83
State and local	14	14	8
Total income tax expense	$ 651	177	105
Tax Rate Reconciliation
U.S. federal income tax rate (as a percent)	34.00%
Income tax expense (benefit) at statutory federal rate	$ 2,503	(1,249)	(4,716)
Increase (reduction) in income taxes resulting from:
Research and development credit, net of federal income tax benefit	(1,025)	(504)	(276)
Non-deductible expenses	685	557	418
Change in valuation allowance	(1,349)	2,590	4,570
State and local income taxes, net of federal income tax benefit	(196)	(432)	(562)
Other	33	(785)	671
Total income tax expense	651	177	105
Deferred tax assets:
Deferred rent	1,090	694
Allowance for doubtful accounts	100	73
Accrued expenses	2,290	1,812
Stock-based compensation	11,034	7,367
Net operating loss carryforwards	253	4,498
Research and development and other credits	4,984	3,236
AMT Credits	29	11
Intangible assets	657	413
Total deferred tax assets	20,437	18,104
Valuation allowance	(8,689)	(10,038)
Net deferred tax assets	11,748	8,066
Deferred tax liabilities:
Research and development costs	(5,649)	(3,681)
Prepaid expenses		(91)
Depreciation	(6,500)	(4,543)
Total deferred liabilities	(12,149)	(8,315)
Net deferred tax liability	(401)	(249)
Taxable loss	$ (3,294)	$ (8,330)	$ (12,424)
Period of cumulative loss position	3 years

Income Taxes - Carryforwards (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Operating Loss Carryforwards
Excess tax benefits from exercise of stock options	$ 30,264
Unrecognized Tax Benefits
Unrecognized tax benefits	0	$ 0	$ 0
Federal
Operating Loss Carryforwards
Excess tax benefits from exercise of stock options	10,290
Net operating loss carryforwards	$ 484
Federal \| Minimum
Operating Loss Carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2030
Federal \| Maximum
Operating Loss Carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2037
State
Operating Loss Carryforwards
Excess tax benefits from exercise of stock options	$ 644
Net operating loss carryforwards	$ 1,777
State \| Minimum
Operating Loss Carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2020
Statute of limitations on filings	3 years
State \| Maximum
Operating Loss Carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2037
Statute of limitations on filings	4 years
Research and development tax credit carryforwards
Operating Loss Carryforwards
Tax credit carryforwards	$ 4,984
Research and development tax credit carryforwards \| Minimum
Operating Loss Carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2018
Research and development tax credit carryforwards \| Maximum
Operating Loss Carryforwards
Expiration date for tax credit carryforwards	Jun. 30, 2037
Alternative minimum tax credit carryforwards
Operating Loss Carryforwards
Tax credit carryforwards	$ 11

Stockholders' Equity (Details)	12 Months Ended
Stockholders' Equity (Details)	Jun. 30, 2017 item
Common Stock
Stockholders' Equity
Number of common stock vote per share	1

Benefit Plans - General Information (Details) shares in Thousands	12 Months Ended
	Jun. 30, 2017 shares
Equity Incentive Plans
Equity Incentive Plans
Number of shares of common stock reserved for issuance	12,433
Number of shares allocated but not yet issued that are subject to outstanding options or awards	4,206
2008 Plan
Equity Incentive Plans
Awards issued (in shares)	0
Awards issuable (in shares)	0
2014 Plan
Equity Incentive Plans
Potential additional shares available for grant (as a percent)	4.50%

Benefit Plans - Incentive Plans Activity (Details) - Equity Incentive Plans shares in Thousands	12 Months Ended
	Jun. 30, 2017 shares
Shares Available for Grant
Balance at the beginning of the period (in shares)	6,244
January 1, 2017 Evergreen provision increase	2,314
RSUs granted (in shares)	(774)
Shares withheld in settlement of taxes and/or exercise price (in shares)	467
Forfeitures (in shares)	89
Shares removed (in shares)	(113)
Balance at the end of the period (in shares)	8,227

Benefit Plans - Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Benefit Plans
Total stock-based compensation expense	$ 26,734	$ 17,563	$ 13,169
Stock-based compensation expense capitalized	1,773	1,078	655
Cost of revenue - recurring
Benefit Plans
Total stock-based compensation expense	2,162	1,648	1,532
Cost of revenue - non-recurring
Benefit Plans
Total stock-based compensation expense	1,357	1,127	1,222
Sales and marketing
Benefit Plans
Total stock-based compensation expense	6,287	4,441	3,247
Research and development
Benefit Plans
Total stock-based compensation expense	3,086	2,789	2,533
General and administrative
Benefit Plans
Total stock-based compensation expense	13,842	$ 7,558	$ 4,635
Modified award agreement \| General and administrative
Benefit Plans
Total stock-based compensation expense	$ 2,925

Benefit Plans - Valuation Assumptions (Details)	12 Months Ended
Benefit Plans - Valuation Assumptions (Details)	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Valuation assumptions:
Expected dividend yield (as a percent)		0.00%	0.00%
Expected volatility (as a percent)		34.00%	43.90%
Expected term (years)		6 years 3 months	6 years 3 months
Risk-free interest rate (as a percent)		1.83%	1.91%
Stock options
Vesting period
Expiration period	10 years
Stock options \| Minimum
Vesting period
Vesting period	3 years
Stock options \| Maximum
Vesting period
Vesting period	4 years

Benefit Plans - Stock Option Activity (Details) - Stock options - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Options Outstanding, Number of Shares
Balance at the beginning of the period	3,464
Options granted	0
Options forfeited	(22)
Options exercised	(691)
Balance at the end of the period	2,751	3,464
Options Outstanding, Weighted average exercise price
Balance at the beginning of the period (in dollars per share)	$ 11.75
Options granted (in dollars per share)		$ 12.92	$ 11.14
Options forfeited (in dollars per share)	18.88
Options exercised (in dollars per share)	12.37
Balance at the end of the period (in dollars per share)	$ 11.54	$ 11.75
Options Additional Disclosures
Weighted average remaining contractual term	5 years 8 months 9 days	6 years 8 months 12 days
Aggregate intrinsic value, at the beginning of the period	$ 108,944
Weighted average remaining contractual term of options exercisable at the end of the period (years)	5 years 5 months 19 days
Aggregate intrinsic value, at the end of the period	$ 92,556	$ 108,944
Options exercisable at the end of the period (in shares)	2,395
Options exercisable at the end of the period, weighted average exercise price (in dollars per share)	$ 9.80
Options exercisable intrinsic value	$ 84,757
Total intrinsic value of options exercised	$ 20,802	$ 13,362	$ 8,802
Options vested and expected to vest
Number of shares	2,742
Weighted average exercise price	$ 11.47
Weighted average remaining contractual term	5 years 8 months 5 days
Aggregate intrinsic value	$ 92,414
Unrecognized Compensation Costs Not yet Recognized
Total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options	$ 625
Weighted average period to recognize unrecognized compensation cost	1 year 4 months 10 days

Benefit Plans - Stock Options Outstanding and Stock Options Exercisable 10K (Details) shares in Thousands	12 Months Ended
	Jun. 30, 2017 $ / shares shares
Stock options
Schedule of stock options outstanding and stock options exercisable
Number Outstanding at end of the period \| shares	2,751
Weighted-Average Remaining Contractual Term	5 years 8 months 9 days
Weighted-Average Exercise Price (in dollars per share)	$ 11.54
Number Exercisable at the end of the period \| shares	2,395
Weighted Average Exercise Price (in dollars per share)	$ 9.80
$1.31 to $3.58
Schedule of stock options outstanding and stock options exercisable
Exercise price range, lower limit (in dollars per share)	1.31
Exercise price range, upper limit (in dollars per share)	$ 3.58
$1.31 to $3.58 \| Stock options
Schedule of stock options outstanding and stock options exercisable
Number Outstanding at end of the period \| shares	463
Weighted-Average Remaining Contractual Term	3 years 1 month 24 days
Weighted-Average Exercise Price (in dollars per share)	$ 1.49
Number Exercisable at the end of the period \| shares	463
Weighted Average Exercise Price (in dollars per share)	$ 1.49
$3.59 to $5.96
Schedule of stock options outstanding and stock options exercisable
Exercise price range, lower limit (in dollars per share)	3.59
Exercise price range, upper limit (in dollars per share)	$ 5.96
$3.59 to $5.96 \| Stock options
Schedule of stock options outstanding and stock options exercisable
Number Outstanding at end of the period \| shares	854
Weighted-Average Remaining Contractual Term	5 years 1 month 21 days
Weighted-Average Exercise Price (in dollars per share)	$ 4.88
Number Exercisable at the end of the period \| shares	854
Weighted Average Exercise Price (in dollars per share)	$ 4.88
$5.97 to $12.02
Schedule of stock options outstanding and stock options exercisable
Exercise price range, lower limit (in dollars per share)	5.97
Exercise price range, upper limit (in dollars per share)	$ 12.02
$5.97 to $12.02 \| Stock options
Schedule of stock options outstanding and stock options exercisable
Number Outstanding at end of the period \| shares	224
Weighted-Average Remaining Contractual Term	6 years 11 days
Weighted-Average Exercise Price (in dollars per share)	$ 7.04
Number Exercisable at the end of the period \| shares	128
Weighted Average Exercise Price (in dollars per share)	$ 7.04
$12.03 to $20.90
Schedule of stock options outstanding and stock options exercisable
Exercise price range, lower limit (in dollars per share)	12.03
Exercise price range, upper limit (in dollars per share)	$ 20.90
$12.03 to $20.90 \| Stock options
Schedule of stock options outstanding and stock options exercisable
Number Outstanding at end of the period \| shares	796
Weighted-Average Remaining Contractual Term	6 years 8 months 19 days
Weighted-Average Exercise Price (in dollars per share)	$ 17.00
Number Exercisable at the end of the period \| shares	796
Weighted Average Exercise Price (in dollars per share)	$ 17.00
$20.91 to $35.28
Schedule of stock options outstanding and stock options exercisable
Exercise price range, lower limit (in dollars per share)	20.91
Exercise price range, upper limit (in dollars per share)	$ 35.28
$20.91 to $35.28 \| Stock options
Schedule of stock options outstanding and stock options exercisable
Number Outstanding at end of the period \| shares	414
Weighted-Average Remaining Contractual Term	7 years 5 months 23 days
Weighted-Average Exercise Price (in dollars per share)	$ 28.46
Number Exercisable at the end of the period \| shares	154
Weighted Average Exercise Price (in dollars per share)	$ 27.16

Benefit Plans - RSU activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Vesting period
Unrecognized excess income tax benefits for stock-based compensation arrangements	$ 15,130	$ 8,228	$ 5,562
Restricted stock units
Vesting period
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options	$ 20,599
Weighted average period to recognize unrecognized compensation cost	1 year 10 months 21 days
RSUs Outstanding Rollforward, Units
RSU Balance at the beginning of the period (in shares)	1,003
RSUs granted (in shares)	774
RSUs vested (in shares)	(255)
RSUs forfeited (in shares)	(67)
RSU Balance at the end of the period (in shares)	1,455	1,003
RSUs expected to vest at the end of the period (in shares)	1,269
RSUs Outstanding, Weighted average grant date fair value
RSU Balance at the beginning of the period (in dollars per share)	$ 32.74
RSUs granted (in dollars per share)	45.66
RSUs vested (in dollars per share)	32.97
RSUs cancelled/forfeited (in dollars per share)	38.09
RSU Balance at the end of the period (in dollars per share)	39.96	$ 32.74
RSUs expected to vest at the end of the period (in dollars per share)	$ 39.59
Restricted stock units \| Minimum
Vesting period
Vesting period	3 years
Restricted stock units \| Maximum
Vesting period
Vesting period	4 years

Benefit Plans - ESPP Information (Details) - USD ($) shares in Thousands, $ in Thousands	6 Months Ended		12 Months Ended
	May 15, 2017	Nov. 15, 2016	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Equity Incentive Plans
Compensation expense (in dollars)			$ 26,734	$ 17,563	$ 13,169
Valuation assumptions:
Expected dividend yield				0.00%	0.00%
Expected volatility				34.00%	43.90%
Expected term (years)				6 years 3 months	6 years 3 months
Risk-free interest rate				1.83%	1.91%
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%
Value of purchase per employee, maximum (in dollars)			$ 25
Number of shares per employee, maximum			2
Period during which shares can be purchased (in years)			1 year
Number of shares of common stock reserved for issuance			824
Additional shares authorized, net (in shares)			0
Potential number of additional shares reserved for issuance each year			400
Potential percentage of additional number of shares reserved for issuance each year			0.75%
Number of shares issued	127	127
Compensation expense (in dollars)			$ 1,263	$ 1,069	$ 656
Valuation assumptions:
Expected dividend yield			0.00%	0.00%	0.00%
Employee stock purchase plan shares \| Minimum
Valuation assumptions:
Expected volatility			38.90%	44.10%	35.50%
Expected term (years)				6 months	3 months 18 days
Risk-free interest rate			0.28%	0.11%	0.04%
Employee stock purchase plan shares \| Maximum
Equity Incentive Plans
Offering period			27 months
Valuation assumptions:
Expected volatility			53.40%	53.40%	48.40%
Expected term (years)			6 months		6 months
Risk-free interest rate			1.02%	0.31%	0.11%

Benefit Plans - 401(k) Plan (Details) - USD ($) $ in Thousands			12 Months Ended
	Jan. 01, 2016	Dec. 31, 2015	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Benefit Plans
401(k) Plan Matching contributions by the Company as percentage of employees' contributions	50.00%	50.00%
401(k) Plan Maximum contributions by the Company as percentage of employees' gross pay	8.00%	6.00%
401(k) Plan contributions			$ 3,667	$ 2,717	$ 1,656

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Anti-dilutive securities excluded from diluted per share calculation
Anti-dilutive securities excluded (in shares)									786	4,482	4,355
Numerator:
Net income (loss)	$ (3,844)	$ 14,801	$ (1,671)	$ (2,568)	$ (5,412)	$ 6,161	$ (1,165)	$ (3,435)	$ 6,718	$ (3,851)	$ (13,972)
Weighted-average shares used in computing net loss per share:
Basic (in shares)	51,602	51,447	51,384	51,231	51,058	50,962	50,890	50,744	51,415	50,913	50,127
Weighted-average effect of potentially dilutive shares:
Employee stock options and restricted stock units									2,642
Diluted (in shares)	51,602	54,002	51,384	51,231	51,058	53,424	50,890	50,744	54,057	50,913	50,127
Net income (loss) per share:
Basic (in dollars per share)	$ (0.07)	$ 0.29	$ (0.03)	$ (0.05)	$ (0.11)	$ 0.12	$ (0.02)	$ (0.07)	$ 0.13	$ (0.08)	$ (0.28)
Diluted (in dollars per share)	$ (0.07)	$ 0.27	$ (0.03)	$ (0.05)	$ (0.11)	$ 0.12	$ (0.02)	$ (0.07)	$ 0.12	$ (0.08)	$ (0.28)
Employee stock options
Anti-dilutive securities excluded from diluted per share calculation
Anti-dilutive securities excluded (in shares)									145	3,464	3,956
Restricted stock units
Anti-dilutive securities excluded from diluted per share calculation
Anti-dilutive securities excluded (in shares)									627	1,003	386
Employee stock purchase plan shares
Anti-dilutive securities excluded from diluted per share calculation
Anti-dilutive securities excluded (in shares)									14	15	13

Selected Quarterly Financial Data (unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Consolidated Statements of Operations Data
Revenues	$ 76,061	$ 90,273	$ 68,654	$ 65,022	$ 59,839	$ 70,570	$ 55,184	$ 45,108	$ 300,010	$ 230,701	$ 152,698
Gross profit	42,898	58,191	38,271	36,663	33,258	43,361	31,084	24,913	176,023	132,616	81,802
Operating income (loss)	(3,434)	14,880	(1,643)	(2,507)	(5,040)	6,201	(1,294)	(3,417)	7,296	(3,550)	(13,921)
Net income (loss)	$ (3,844)	$ 14,801	$ (1,671)	$ (2,568)	$ (5,412)	$ 6,161	$ (1,165)	$ (3,435)	$ 6,718	$ (3,851)	$ (13,972)
Net income (loss) per share:
Basic (in dollars per share)	$ (0.07)	$ 0.29	$ (0.03)	$ (0.05)	$ (0.11)	$ 0.12	$ (0.02)	$ (0.07)	$ 0.13	$ (0.08)	$ (0.28)
Diluted (in dollars per share)	$ (0.07)	$ 0.27	$ (0.03)	$ (0.05)	$ (0.11)	$ 0.12	$ (0.02)	$ (0.07)	$ 0.12	$ (0.08)	$ (0.28)
Weighted-average shares used in computing net income (loss) per share:
Basic (in shares)	51,602	51,447	51,384	51,231	51,058	50,962	50,890	50,744	51,415	50,913	50,127
Diluted (in shares)	51,602	54,002	51,384	51,231	51,058	53,424	50,890	50,744	54,057	50,913	50,127