Automatic Data Processing, Inc. (ADP) - Payroll Services  -  Category Directory

973-974-5000

1 ADP Boulevard

Roseland, New Jersey 07068

www.adp.com

Sales

$7.1 billion

Business Description

Automatic Data Processing, Inc., is one of the largest providers of payroll services,

computerized transaction processing, data communication and
information services in the world. The following summary describes ADP's activities.

Employer Services

Employer Services offers a comprehensive range of payroll services
human resource ("HR") and benefits administration products and services,
including traditional and Web-based outsourcing solutions that help over 460,000
employers in North America, Europe, South America (primarily Brazil), Australia
and Asia staff, manage, pay and retain their employees. Employer Services
markets these products and services through its direct marketing sales force
and, on a limited basis, through indirect sales channels, such as marketing
relationships with banks, accountants and online companies. In fiscal 2003, 90%
of Employer Services' revenues were from North America, 9% were from Europe and
1% was from South America (primarily Brazil), Australia and Asia.

Employer Services' approach to the market is to match a client's needs
with the product that will best meet expectations. To facilitate this approach,
in North America, Employer Services is comprised of the following groups: Small
Business Services (which was previously known as Emerging Business Services)
("SBS") (primarily companies with fewer than 50 employees); Major Accounts
(primarily companies with between 50 and 999 employees); and National Accounts
Services (primarily companies with 1,000 or more employees).

SBS provides payroll services for smaller companies and provides them with
leading solutions, including a range of value-added services that are
specifically designed for small business clients. Major Accounts and National
Accounts Services offer a full suite of best-of-breed employer services
solutions, including full database and other functional integration between
payroll and HR for clients ranging from mid-sized through many of the world's
largest corporations. In fiscal 2003, ADP expanded its presence in its National
Accounts Services market through its acquisition of ProBusiness Services, Inc.,
a provider of comprehensive payroll, tax filing and HR processing services to
large companies in the United States.

In some cases, ADP provides system solutions for its clients' entire
human resource, payroll and benefits needs. Through ADP Connection(R), ADP can
enable its largest clients to interface their major enterprise resource planning
applications with ADP's outsourced payroll services. For those companies that
choose to process these applications in-house, ADP delivers stand-alone services
such as payroll tax filing, check printing and distribution and year-end tax
statements (i.e., W-2s). Other large clients rely on ADP to design and deliver
customized human resource information systems and benefits outsourcing
solutions.

In North America, ADP provides payroll services that include the
preparation of client employee paychecks and electronic direct deposits, along
with supporting journals, summaries and management reports. ADP also supplies
the quarterly and annual social security, medicare and federal, state and local
income tax withholding reports required to be filed by employers and employees.
In Europe, South America (primarily Brazil), Australia and Asia, Employer
Services provides full departmental outsourcing of payroll services.

The ADP Financial and Compliance Services business (which was
previously known as ADP Tax and Financial Services) processes and collects
federal, state and local payroll taxes on behalf of, and from, ADP clients and
remits such taxes to the appropriate taxing authorities. The ADP Financial and
Compliance Services business is also responsible for the efficient movement of
funds and information from clients to third parties through service offerings
such as new hire reporting, ADP's TotalPay(TM) payroll check (ADPCheck(TM)),
full service direct deposit (FSDD) and, in conjunction with major bank partners,
stored value payroll card (TotalPay Card) products and the collection and
payment of wage garnishments. The ADP Financial and Compliance Services business
supports large, mid-sized and small clients. It provides an electronic interface
between approximately 364,000 ADP clients in the United States and Canada and
about 2,000 federal, state, provincial and local tax agencies, from the Internal
Revenue Service to local town governments. In fiscal 2003, the ADP Financial and
Compliance Services business printed and delivered approximately 38 million
year-end tax statements in North America and moved over $620 billion in client
funds to taxing authorities and its clients' employees via electronic transfer,
direct deposit and ADPCheck.

ADP's HR services, by interfacing with a client's payroll database,
provide comprehensive HR recordkeeping services, including benefits
administration and outsourcing, applicant tracking, employee history and
position control. ADP's Benefits Services provides benefits administration
across all market segments, including management of the open enrollment of
benefits, COBRA and flexible spending account administration, Section 529
College Savings Plan administrative services and 401(k) recordkeeping. In fiscal
2003, ADP greatly expanded its retirement services business through its
acquisition of the retirement services recordkeeping operations of Scudder
Investments, making ADP the 4th largest recordkeeper of retirement plans in the
United States (based on number of plans).

ADP TotalSource, ADP's professional employer organization ("PEO")
business, provides clients with comprehensive employment administration
outsourcing solutions, including payroll, tax filing, employee background
checks, HR guidance, 401(k) plan administration, benefits administration,
regulatory compliance services, workers' compensation insurance and supplemental
benefits for employees. ADP TotalSource, the second largest PEO in the U.S.
(based on the number of worksite employees), has 29 offices located in fifteen
states and serves over 3,800 PEO clients and over 85,000 work-site employees in
all 50 states.

ADP complements its payroll and HR services with additional employer
services that include products such as time and labor management, pre-employment
screening and selection services and unemployment compensation management. In
fiscal 2003, ADP expanded its service offerings by acquiring the assets of the
SMS companies, leading providers of job tax credit services that assist
employers in the identification of, and filing for, special tax credits based
on geography, demographics and other criteria.

During fiscal 2003, ADP continued the process of Web-enabling existing
product offerings, while at the same time creating new products expressly
designed for the Internet. ADP's Internet offerings now include its
EasyPayNet(sm) Web-based payroll solution for SBS clients, Pay eXpert(R)
Web-based payroll solution for Major Accounts clients and its PayForce(sm)
Web-based payroll solution and

Enterprise HRMS integrated HR, payroll and benefits solution for National
Accounts Services clients, all of which feature Web-based employer self-service
capabilities. Further, during fiscal 2003, ADP continued its rollout of its new
TotalChoice(sm) Solutions Web-based payroll solution, a fully-integrated,
Web-native human resource and payroll management solution hosted by ADP that was
originally launched in fiscal 2002. For benefits administration, ADP offers
Benefits eXpert(sm), a Web-based benefits administration and employee
self-service solution that allows mid-sized companies in Major Accounts to
manage more efficiently their employees' health and welfare benefits. For large
clients, ADP Benefit Services offers a Web-based COBRA administrative solution,
as well as employee self-service applications for open-enrollment, flexible
spending account administration and other employee-administered benefit options.

The continued increase in the number of multi-national companies makes
payroll and human resource management services a global opportunity. In fiscal
2003, ADP increased payroll sales to multi-national employers throughout Europe
by nearly 36% over the previous fiscal year.

Brokerage Services

Brokerage Services provides transaction processing systems, desktop
productivity applications and investor communications services to the financial
services industry worldwide. ADP's products and services include: (i) global
order entry, trade processing and settlement systems that enable firms to trade
virtually any financial instrument, in any market, at any time; (ii)
full-service investor communications services including: electronic delivery and
Web solutions; workflow services; financial, offset, and on-demand printing;
proxy distribution and vote processing; householding; regulatory mailings;
fulfillment; and customized communications; (iii) real-time order entry and
processing services for Web-based brokerage firms; (iv) automated, browser-based
desktop productivity tools for financial consultants and back office personnel;
and (v) integrated delivery of multiple products and services through ADP's
Global Processing Solution.

Brokerage Services serves a large client base in the financial services
industry, including: retail and institutional brokerage firms; global banks;
mutual funds; annuity companies; institutional investors; specialty trading
firms; clearing firms; hedge funds; and publicly owned corporations. Brokerage
Services provides securities transaction processing, printing and electronic
distribution of shareholder communications and other services to clients in more
than 25 countries in North America, Europe, Asia, South America and Australia.
Brokerage Services also provides computerized proxy vote tabulation and
shareholder communication, distribution and fulfillment services, including
Web-enabled products and services. ADP served approximately 14,000 publicly
traded companies and 450 mutual funds and annuity companies with proxy services
on behalf of more than 800 brokerage firms and banks in fiscal 2003. In fiscal
2003, Brokerage Services received ISO 9001:2000 certification, an international
standard for the highest quality, for its vote processing, production
operations, print operations and client services systems.

In fiscal 2003, Brokerage Services acquired the assets of Vantra Group,
Inc., a leading provider of specialized Web-based solutions to brokerage
clients; all of the capital stock of Power Securities Systems, Inc., a leading
back-office software provider for niche market firms; and all of the capital
stock of Dataphile Software, Ltd., a leading provider of real-time,
straight-through-processing solutions for brokerage firms and mutual fund
securities dealers in Canada.

Dealer Services

Dealer Services provides integrated dealer management computer systems
(such a system is also known in the industry as a "DMS") and other business
performance solutions to automotive retailers and their manufacturers throughout
North America and Europe. More than 16,000 automobile and truck dealers and more
than 30 manufacturers use ADP's DMS, networking solutions, data integration,
consulting and/or marketing services.

Dealer Services offers its dealership clients a service solution that
includes computer hardware, hardware maintenance services, licensed software,
software support, system design and network consulting services. Dealer Services
also offers its clients "front-end" dealership sales process and business
development training services, consulting services, software products and
customer relationship management solutions. Clients use an ADP DMS to manage
business activities such as accounting, inventory, factory communications,
scheduling, vehicle financing, insurance, sales and service. Dealer Services
also designs, establishes and maintains communications networks for its
dealership clients that allow interactive communications among multiple site
locations (for larger dealers), as well as links between franchised dealers and
their vehicle manufacturer franchisors. These networks are used for activities
such as new vehicle ordering and status inquiry, warranty submission and
validation, parts and vehicle locating, dealership customer credit application
submission and decisioning, vehicle repair estimating and obtaining vehicle
registration and lien holder information. Dealer Services also offers an
Application Service Provider Managed Services solution to its dealership clients
pursuant to which such clients outsource all information technology management,
computing and network infrastructure, technology decisions and system support to
Dealer Services.

Claims Services

Claims Services offers integrated business solutions for clients in the
property and casualty insurance, auto collision repair and auto recycling
industries. These products help clients manage costs and improve efficiency and
accelerate the claims review and settlement process. These products and services
include (i) claims management applications such as automated repair estimating,
total loss vehicle valuation, first notice of loss, dispatch and assignment,
claims audit, parts exchange and workflow applications that streamline the
end-to-end claims process, (ii) body shop and auto recycler management systems
and (iii) other applications, databases and services that enhance and optimize
the claims process.

Ticker

ADP
 

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