CONSOLIDATED FINANCIAL STATEMENTS  




CONSOLIDATED BALANCE SHEETS (In thousands, except par value) JULY 31, 2003 JULY 31, 2004
ASSETS
Current assets:
    Cash and cash equivalents		     $ 170,043           $ 27,249      
    Short-term investments   1,036,758     991,971  
    Accounts receivable, net of allowance for doubtful
    accounts of $5,409 and $7,841, respectively		   88,156     92,265  
    Deferred income taxes   34,824     31,473  
    Prepaid expenses and other current assets   33,082     50,542  
        Current assets before funds held for payroll customers   1,362,863     1,193,500  
    Funds held for payroll customers   306,007     323,041  
        Total current assets   1,668,870     1,516,541  
Property and equipment, net   188,253     233,101  
Goodwill, net   591,091     670,030  
Purchased intangible assets, net   125,445     107,301  
Long-term deferred income taxes   183,061     135,711  
Loans to executive officers and other employees   19,690     15,809  
Other assets   13,857     17,685  
Total assets $ 2,790,267   $ 2,696,178  
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
    Accounts payable		 $ 56,786   $ 70,443  
    Accrued compensation and related liabilities   118,678     135,047  
    Deferred revenue   178,840     223,380  
    Income taxes payable   76,725     22,159  
    Other current liabilities   59,129     83,295  
        Current liabilities before payroll customer fund deposits   490,158     534,324  
    Payroll customer fund deposits   306,007     323,041  
        Total current liabilities   796,165     857,365  
Long-term obligations   29,265     16,394  
Commitments and contingencies
Stockholders' equity:
    Preferred stock, $0.01 par value
        Authorized—1,345 shares total; 145 shares designated Series A;
        250 shares designated Series B Junior Participating
        Issued and outstanding -- None		   -     -  
    Common stock, $0.01 par value
        Authorized—750,000 shares
        Issued and outstanding—199,472 and 190,091 shares, respectively		   1,995     1,901  
    Additional paid-in capital   1,919,559     1,947,325  
    Treasury stock, at cost   (672,326 )   (1,088,389 )
    Deferred compensation   (25,850 )   (19,434 )
    Accumulated other comprehensive loss   (789 )   (3,375 )
    Retained earnings   742,248     984,391  
        Total stockholders' equity   1,964,837     1,822,419  
Total liabilities and stockholders' equity $ 2,790,267   $ 2,696,178  

See accompanying notes.