Document And Entity Information - shares	3 Months Ended
Document And Entity Information - shares	Sep. 30, 2018	Nov. 05, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2018
Entity Registrant Name	CDK Global, Inc.
Entity Central Index Key	0001609702
Current Fiscal Year End Date	--06-30
Entity Filer Category	Large Accelerated Filer
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Entity Common Stock, Shares Outstanding		128,773,455

Condensed Consolidated and Combined Statements of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Revenues	$ 554.5	$ 565.7
Expenses:
Cost of revenues	281.6	307.7
Selling, general and administrative expenses	98.3	113.7
Restructuring expenses	17.2	6.5
Total expenses	397.1	427.9
Operating earnings	157.4	137.8
Interest expense	(32.2)	(23.3)
Other income, net	2.6	5.3
Earnings before income taxes	127.8	119.8
Provision for income taxes	(35.5)	(36.7)
Net earnings	92.3	83.1
Less: net earnings attributable to noncontrolling interest	2.0	1.8
Net earnings attributable to CDK	$ 90.3	$ 81.3
Net earnings attributable to CDK per common share:
Basic (usd per share)	$ 0.70	$ 0.58
Diluted (usd per share)	$ 0.69	$ 0.57
Weighted-average common shares outstanding:
Basic (shares)	129.6	140.1
Diluted (shares)	130.4	141.4

Condensed Consolidated and Combined Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Net earnings	$ 92.3	$ 83.1
Other comprehensive income (loss):
Currency translation adjustments	(6.0)	14.2
Other comprehensive income (loss)	(6.0)	14.2
Comprehensive income	86.3	97.3
Less: comprehensive income attributable to noncontrolling interest	2.0	1.8
Comprehensive income attributable to CDK	$ 84.3	$ 95.5

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Sep. 30, 2018	Jun. 30, 2018
Current assets:
Cash and cash equivalents	$ 312.8	$ 804.4
Accounts receivable, net of allowances of $5.3 and $7.4, respectively	383.6	374.6
Other current assets	115.6	188.3
Total current assets	812.0	1,367.3
Property, plant and equipment, net	141.2	131.9
Other assets	285.5	165.5
Goodwill	1,592.4	1,217.2
Intangible assets, net	259.8	126.5
Total assets	3,090.9	3,008.4
Current liabilities:
Current maturities of long-term debt and capital lease obligations	17.9	45.2
Accounts payable	44.5	50.5
Accrued expenses and other current liabilities	253.0	198.0
Accrued payroll and payroll-related expenses	63.1	85.7
Short-term deferred revenues	122.1	169.0
Total current liabilities	500.6	548.4
Long-term debt and capital lease obligations	2,673.6	2,575.5
Long-term deferred revenues	68.6	110.4
Deferred income taxes	85.6	56.7
Other liabilities	62.1	64.7
Total liabilities	3,390.5	3,355.7
Stockholders' Deficit:
Preferred stock, $0.01 par value: Authorized, 50.0 shares; issued and outstanding, none	0.0	0.0
Common stock, $0.01 par value: Authorized, 650.0 shares; issued, 160.3 and 160.3 shares, respectively; outstanding, 128.8 and 130.1 shares, respectively	1.6	1.6
Additional paid-in-capital	654.6	679.8
Retained earnings	933.6	753.0
Treasury stock, at cost: 31.6 and 30.2 shares, respectively	(1,909.6)	(1,810.7)
Accumulated other comprehensive income	5.1	11.5
Total CDK stockholders' deficit	(314.7)	(364.8)
Noncontrolling interest	15.1	17.5
Total stockholder's deficit	(299.6)	(347.3)
Total liabilities and stockholders' deficit	$ 3,090.9	$ 3,008.4

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2018	Jun. 30, 2018
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 5.3	$ 7.4
Preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	50,000,000.0	50,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized	650,000,000.0	650,000,000
Common stock, shares issued	160,300,000	160,300,000
Common stock, shares outstanding	128,800,000	130,100,000
Treasury stock shares	31,600,000	30,200,000

Condensed Consolidated and Combined Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash Flows from Operating Activities:
Net earnings	$ 92.3	$ 83.1
Adjustments to reconcile net earnings to cash flows provided by operating activities:
Depreciation and amortization	19.7	19.5
Deferred income taxes	7.8	2.3
Stock-based compensation expense	3.3	8.1
Other	1.4	1.5
Changes in operating assets and liabilities, net of effect from acquisitions of businesses:
Decrease (increase) in accounts receivable	12.2	(1.8)
Decrease in other assets	13.0	19.8
Decrease in accounts payable	(9.5)	(3.8)
Decrease in accrued expenses and other liabilities	(0.2)	(0.9)
Net cash flows provided by operating activities	140.0	127.8
Cash Flows from Investing Activities:
Capital expenditures	(8.8)	(10.3)
Capitalized software	(10.1)	(9.6)
Acquisitions of businesses, net of cash acquired	(513.2)	0.0
Contributions to investments	10.0	0.0
Proceeds from investments	0.0	0.8
Net cash flows used in investing activities	(542.1)	(19.1)
Cash Flows from Financing Activities:
Proceeds from long-term debt	860.0	0.0
Repayments of long-term debt and capital lease obligations	(792.3)	(11.6)
Dividends paid to stockholders	(19.3)	(19.7)
Repurchases of common stock	(114.1)	(14.6)
Proceeds from exercises of stock options	1.0	2.6
Withholding tax payments for stock-based compensation awards	(14.9)	(8.5)
Dividend payments to noncontrolling owners	(4.4)	0.0
Payments of deferred financing costs	(4.4)	(0.4)
Acquisition-related payments	(1.1)	(0.9)
Net cash flows used in financing activities	(89.5)	(53.1)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	(3.5)	6.9
Net change in cash, cash equivalents, and restricted cash	(495.1)	62.5
Cash,cash equivalents, and restricted cash, beginning of period	817.1	734.0
Cash, cash equivalents, and restricted cash end of period	322.0	796.5
Total cash, cash equivalents, and restricted cash	817.1	734.0
Cash paid for:
Income taxes and foreign withholding taxes, net of refunds	11.8	8.7
Interest	$ 6.8	$ 6.5

Condensed Consolidated Statement of (Deficit) Equity - USD ($) shares in Millions, $ in Millions	Total	Common Stock	Additional Paid-in-Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive Income	Total CDK Stockholders' Deficit	Non-controlling Interest
Common Stock, Dividends, Per Share, Declared	$ 0.140
Stockholders' equity, beginning balance at Jun. 30, 2017	$ (56.8)	$ 1.6	$ 608.6	$ 452.7	$ (1,144.7)	$ 8.0	$ (73.8)	$ 17.0
Common stock, shares issued, beginning balance at Jun. 30, 2017		160.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	83.1			81.3			81.3	1.8
Foreign currency translation adjustments	14.2					14.2	14.2
Stock-based compensation expense and related dividend equivalents	6.8		6.9	(0.1)			6.8
Common stock issued for the exercise and vesting of stock-based compensation awards, net	(5.9)		(17.6)		11.7		(5.9)
Dividends paid to stockholders	(19.7)			(19.7)			(19.7)
Repurchases of common stock	(14.6)		66.9		(81.5)		(14.6)
Common stock, shares issued, end balance at Sep. 30, 2017		160.3
Stockholders' equity, ending balance at Sep. 30, 2017	$ 7.1	$ 1.6	664.8	514.2	(1,214.5)	22.2	(11.7)	18.8
Common Stock, Dividends, Per Share, Declared	$ 0.150
Stockholders' equity, beginning balance at Jun. 30, 2018	$ (347.3)	$ 1.6	679.8	753.0	(1,810.7)	11.5	(364.8)	17.5
Common stock, shares issued, beginning balance at Jun. 30, 2018	160.3	160.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	$ 92.3			90.3			90.3	2.0
Foreign currency translation adjustments	(6.0)					(6.0)	(6.0)
Stock-based compensation expense and related dividend equivalents	3.8		3.9	(0.1)			3.8
Common stock issued for the exercise and vesting of stock-based compensation awards, net	(13.9)		(29.1)		15.2		(13.9)
Dividends paid to stockholders	(19.3)			(19.3)			(19.3)
Repurchases of common stock	(114.1)				(114.1)		(114.1)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(4.4)							(4.4)
Cumulative Effect on Retained Earnings, Net of Tax	$ 109.3			109.7		(0.4)	109.3
Common stock, shares issued, end balance at Sep. 30, 2018	160.3	160.3
Stockholders' equity, ending balance at Sep. 30, 2018	$ (299.6)	$ 1.6	$ 654.6	$ 933.6	$ (1,909.6)	$ 5.1	$ (314.7)	$ 15.1

Basis of Presentation	3 Months Ended
Basis of Presentation	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation A. Description of Business CDK Global, Inc. (the "Company" or "CDK") enables end-to-end automotive commerce across the globe. For over 40 years, the Company has served automotive retailers and original equipment manufacturers ("OEMs") by providing innovative solutions that allow them to better connect, manage, analyze, and grow their businesses. The Company's solutions automate and integrate all parts of the buying process, including the advertising, acquisition, sale, financing, insuring, parts supply, repair, and maintenance of vehicles, in more than 100 countries around the world, for approximately 28,000 retail locations and most OEMs. The Company is organized into two main operating groups. The Company's first operating group is CDK North America which is comprised of two reportable segments, Retail Solutions North America ("RSNA") and Advertising North America ("ANA"). The second operating group, which is also a reportable segment, is CDK International ("CDKI"). In addition, the Company has an Other segment, the primary components of which are corporate allocations and other expenses not recorded in the segment results. Refer to Note 15 for further information. B. Basis of Preparation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect assets, liabilities, revenues, and expenses that are reported in the accompanying financial statements and footnotes thereto. Actual results may differ from those estimates and assumptions. The accompanying condensed consolidated financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of the results for the interim periods. Interim financial results are not necessarily indicative of financial results for a full year. The financial statements in this Quarterly Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2018. Certain prior year amounts have been reclassified to conform to current year presentation. See the discussion in Note 3, New Accounting Pronouncements for the impact of adopting Accounting Standards Update ("ASU") 2016-18 on the presentation of changes in restricted cash in the statement of cash flows.

Summary of Significant Accounting Policies	3 Months Ended
Summary of Significant Accounting Policies	Sep. 30, 2018
Accounting Policies [Abstract]
Summary of significant accounting policies	Summary of Significant Accounting Policies A. Revenue Recognition and Deferred Costs Effective July 1, 2018, the Company adopted the Financial Accounting Standard Board (“FASB”) Accounting Standards Update ("ASU") 2014-09, “Revenue from Contracts with Customers,” and related ASUs ("ASC 606") using the modified retrospective approach. The comparative information has not been restated and continues to be reported under the accounting standards in effect for the period presented. Refer to Note 5, Revenue for the required disclosures related to the impact of adopting ASC 606 and a discussion of the Company's updated policy related to revenue recognition and deferred costs. Refer to Note 2, Summary of Significant Accounting Policies in the Company's Annual Report on Form 10-K for the Company's revenue recognition and deferred costs policies prior to adoption of ASC 606. B. Funds Receivable and Funds Held for Clients and Client Fund Obligations Funds receivable and funds held for clients represent amounts received or expected to be received from clients in advance of performing titling and registration services on behalf of those clients. These amounts are classified within other current assets on the condensed consolidated balance sheets. The total amount due to remit for titling and registration obligations with the department of motor vehicles is recorded to client fund obligations which is classified as accrued expenses and other current liabilities on the condensed consolidated balance sheets. Funds receivable was $30.1 million and $33.1 million, and funds held for clients was $9.2 million and $12.7 million as of September 30, 2018 and June 30, 2018, respectively. Client fund obligation was $39.3 million and $45.8 million as of September 30, 2018 and June 30, 2018, respectively. C. Internal Use Software and Computer Software to be Sold, Leased, or Otherwise Marketed The Company’s policy provides for the capitalization of external direct costs of materials and services associated with developing or obtaining internal use computer software. In addition, the Company’s policy also provides for the capitalization of certain payroll and payroll-related costs for employees who are directly associated with the internal use computer software projects. The amount of capitalizable payroll costs with respect to these employees is limited to the time directly spent on such projects. Costs associated with preliminary project stage activities, training, maintenance, and all other post-implementation stage activities are expensed as incurred. The Company also expenses internal costs related to minor upgrades and enhancements, as it is impracticable to separate these costs from normal maintenance activities. The Company amortizes internal use software typically over a three to five year life. The Company's policy provides for the capitalization of certain costs of computer software to be sold, leased, or otherwise marketed. The Company's policy provides for the capitalization of all software production costs upon reaching technological feasibility for a specific product. Technological feasibility is attained when software products have a completed working model whose consistency with the overall product design has been confirmed by testing. Costs incurred prior to the establishment of technological feasibility are expensed as incurred. The establishment of technological feasibility requires judgment by management and in many instances is only attained a short time prior to the general release of the software. Maintenance-related costs are expensed as incurred. Pursuant to this policy, the Company recognized expenses of $19.9 million and $38.0 million for the three months ended September 30, 2018 and 2017, respectively. These expenses were classified within cost of revenues on the condensed consolidated statements of operations. Additionally, we had cash flows used for qualifying capitalized software development cost of $10.1 million and $9.6 million for the three months ended September 30, 2018 and 2017, respectively. D. Fair Value of Financial Instruments The Company determines the fair value of financial instruments in accordance with accounting standards pertaining to fair value measurements. Such standards define fair value and establish a framework for measuring fair value in accordance with GAAP. Cash and cash equivalents, accounts receivable, other current assets, accounts payable, and other current liabilities are reflected in the condensed consolidated balance sheets at cost, which approximates fair value due to the short-term nature of these instruments. The carrying value of the Company's term loan facilities (as described in Note 9), including accrued interest, approximates fair value based on the Company's current estimated incremental borrowing rate for similar types of arrangements.

New Accounting Pronouncements

3 Months Ended

Sep. 30, 2018

Accounting Changes and Error Corrections [Abstract]

New Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other.” ASU 2017-04 simplifies the accounting for goodwill impairment by eliminating Step 2 of the current goodwill impairment test, which required a hypothetical purchase price allocation. Goodwill impairment will now be the amount by which the reporting unit’s carrying value exceeds its fair value, limited to the carrying value of the goodwill. ASU 2017-04 is effective for financial statements issued for fiscal years, and interim periods beginning after December 15, 2019. The Company adopted this standard on July 1, 2018 with no impact on our condensed consolidated financial statements.

In November 2016, the FASB issued ASU 2016-18, “Restricted Cash.” ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. ASU 2016-18 is effective for financial statements issued for fiscal years, and interim periods beginning after December 15, 2017. The Company adopted ASU 2016-18 retrospectively during the first quarter of fiscal year 2019, and as a result included restricted cash with cash and cash equivalents when reconciling the beginning of the period and end of the period total amounts presented on the Condensed Consolidated Statements of Cash Flows. Accordingly, the Condensed Consolidated Statement of Cash Flows has been revised to include restricted cash associated with funds held for clients as a component of cash, cash equivalents, and restricted cash.

As a result of the adoption, the Company adjusted the Condensed Consolidated Statements of Cash Flows from previously reported amounts as follows:



	Three Months Ended September 30, 2017
	Originally Reported		Adjustments due to ASU 2016-18		As Adjusted
Cash, cash equivalents, and restricted cash, beginning of period	$	726.1	$	7.9	$	734.0
Net cash flows provided by operating activities	127.8		—		127.8
Cash, cash equivalents, and restricted cash end of period	788.6		7.9		796.5

In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (Topic 230).” ASU 2016-15 addresses eight specific cash flow issues where there is diversity in practice in how these certain cash receipts and cash payments are presented and classified in the statements of cash flows. ASU 2016-15 is effective for financial statements issued for fiscal years, and interim periods beginning after December 15, 2017. The adoption of ASU 2016-15 did not have a material impact on the Company's condensed consolidated statements of cash flows.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” Refer to Note 5, Revenue, for the required disclosures related to the impact of adopting ASC 606.

Recently Issued Accounting Pronouncements

In August 2018, the FASB issued ASU 2018-15, "Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract," which aligns the accounting for implementation cost incurred in a hosting arrangement that is a service contract with the accounting for implementation costs incurred to develop or obtain internal-use software under ASC 350-40, in order to determine which costs to capitalize and recognize as an asset. ASU 2018-15 is effective for fiscal years, and interim periods beginning after December 15, 2019, and can be applied either prospectively to implementation costs incurred after the date of adoption or retrospectively to all arrangements. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of ASU 2018-18 on its consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." ASU 2016-02 requires that lessees recognize right-of-use assets and lease liabilities for any lease classified as either a finance or operating lease that is not considered short-term. The accounting applied by lessors is largely consistent with the existing lease standard. ASU 2016-02 is effective for fiscal years, and interim reporting periods within those years, beginning after December 15, 2018. The Company has obligations under lease agreements for facilities and equipment, which are classified as operating leases under the existing lease standard. While the Company is still evaluating the impact that ASU 2016-02 will have on the consolidated results of operations, financial condition, or cash flows, the Company's financial statements will reflect an increase in both assets and liabilities due to the requirement to recognize right-of-use assets and lease liabilities on the consolidated balance sheets for its facility and equipment leases.The cumulative effects of the changes made to the consolidated July 1, 2018 balance sheet for the adoption of ASC 606 were as follows:



	Balance at June 30, 2018		Adjustments due to ASC 606			Balance at July 1, 2018
Assets
Accounts receivable	$	374.6	$	2.6		$	377.2
Other current assets	188.3		(61.8		)	126.5
Other assets	165.5		112.8			278.3
Liabilities
Accrued expenses and other current liabilities	198.0		0.4			198.4
Short-term deferred revenues	169.0		(38.4		)	130.6
Long-term deferred revenues	110.4		(41.0		)	69.4
Deferred income taxes	56.7		23.2			79.9
Other liabilities	64.7		0.1			64.8
Stockholders' Deficit
Retained earnings	753.0		109.7			862.7
Accumulated other comprehensive income	11.5		(0.4		)	11.1

Impact on Consolidated Financial Statements

Adoption of ASC 606 had no impact to net cash (used in) or provided by operating, financing, or investing activities on the Company’s condensed consolidated statements of cash flows. The following tables summarize the effects of ASC 606 on selected unaudited line items within our condensed consolidated statement of operations and balance sheet:



	Three Months Ended September 30, 2018
	As Reported ASC 606	Impact of ASC 606		ASC 605
Revenues	554.5	(11.4	)	565.9
Cost of revenues	281.6	(8.6	)	290.2
Selling, general and administrative expenses	98.3	(0.3	)	98.6
Total expenses	397.1	(8.9	)	406.0
Operating earnings	157.4	(2.5	)	159.9



Earnings before income taxes	127.8		(2.5	)	130.3
Provision for income taxes	(35.5	)	0.7		(36.2	)
Net earnings	92.3		(1.8	)	94.1
Net earnings attributable to CDK	90.3		(1.8	)	92.1
Net earnings attributable to CDK per common share:
Basic	0.70		(0.01	)	0.71
Diluted	0.69		(0.02	)	0.71



	September 30, 2018
	As Reported ASC 606	Impact of ASC 606		ASC 605
Assets
Accounts receivable	383.6	(3.0	)	380.6
Other current assets	115.6	55.7		171.3
Other assets	285.5	(116.7	)	168.8
Liabilities
Accrued expenses and other current liabilities	253.0	(3.7	)	249.3
Short-term deferred revenues	122.1	32.3		154.4
Long-term deferred revenues	68.6	34.5		103.1
Deferred income taxes	85.6	(20.0	)	65.6
Other liabilities	62.1	(0.2	)	61.9
Stockholders' Deficit
Retained earnings	933.6	(107.9	)	825.7
Accumulated other comprehensive income	5.1	1.0		6.1

Acquisitions

3 Months Ended

Sep. 30, 2017

Business Combinations [Abstract]

Acquisitions

Fiscal 2019 Acquisition

ELEAD1ONE

On September 14, 2018, the Company acquired the equity interests of ELEAD1ONE. ELEAD1ONE’s automotive customer relationship management ("CRM") software and call center solutions enable interaction between sales, service and marketing operations to provide dealers with an integrated customer acquisition and retention platform. The acquisition was made pursuant to an equity purchase agreement, which contains customary representations, warranties, covenants, and indemnities by the sellers and the Company. The Company acquired all of the outstanding stock of ELEAD1ONE for an initial cash purchase price of $513.2 million, net of cash acquired of $7.0 million.

The purchase price for this acquisition was provisionally allocated to the assets acquired and liabilities assumed based on their estimated fair values as follows:



Cash and cash equivalents	$	7.0
Accounts receivable	19.1
Other current assets	3.4
Property, plant and equipment	13.4
Intangible assets	130.3
Accrued expenses and other current liabilities	(18.7		)
Short-term deferred revenues	(6.5		)
Capital lease obligations	(6.1		)
Total identifiable net assets	141.9
Goodwill	378.3
Net assets acquired	$	520.2

The intangible assets acquired primarily relate to customer lists, software, and trademarks, which will be amortized over a weighted-average useful life of 12.3 years. The goodwill resulting from this acquisition reflects expected synergies resulting from adding ELEAD1ONE products and processes to the Company's products and processes. The acquired goodwill is allocated to the RSNA reportable segment. The acquired goodwill is deductible for tax purposes.

Given the timing of the acquisition, the fair value estimate of assets acquired and liabilities assumed are pending completion of multiple elements, including gathering further information about the identification and completeness of all assets acquired and liabilities assumed, the finalization of an independent appraisal and valuations of fair value of the assets acquired and liabilities assumed and final review by the Company's management. The fair values of assets acquired and liabilities assumed were based on a preliminary valuation analysis and are considered provisional. These estimates and assumptions are subject to change within the one-year measurement period if additional information, which existed as of the acquisition date, becomes known to the Company. Accordingly, there could be material adjustments to the consolidated financial statements, including changes in our depreciation and amortization expense related to the valuation of property, plant and equipment and intangible assets acquired and their respective useful lives among other adjustments.

In October 2018, CDK began exploring the possibility of selling the airplane acquired as part of the ELEAD1ONE acquisition. As a result of the activities, CDK concluded the airplane met the criteria for held for sale in the second quarter of fiscal year 2019, and a completed sale is expected before the end of fiscal year 2019. The purchase price allocation for the airplane will be adjusted to reflect the fair value of the airplane less estimated costs to sell.

The results of operations for ELEAD1ONE have been included in the condensed consolidated results of operations from the date of acquisition. The pro forma effects of this acquisition are not significant to the Company's reported results for any period presented. Accordingly, no pro forma financial statements have been presented herein.

In addition to the acquisition, the Company entered into a joint venture agreement with the sellers. Under the terms of the joint venture agreement, the Company contributed $10.0 million to the venture at the ELEAD1ONE acquisition closing and has an obligation to contribute an additional $10.0 million in the future based on defined milestones in the joint venture agreement

and will own 50% of the joint venture. The Company’s contributions are expected to fund the initial operations of the joint venture. The Company does not have an obligation to fund the operations of the joint venture beyond this initial commitment. Under ASC 810 "Consolidation," the joint venture was determined to be a variable interest entity ("VIE"); however, the Company is not the primary beneficiary. As such, the joint venture will be accounted for as an equity method investment. The initial $10.0 million contribution was recorded as an investment and is included on the condensed consolidated balance sheets within other assets. The Company has assessed the maximum exposure to loss related to the joint venture to be the $20.0 million contributed and committed to be contributed. The Company has assessed the risk of loss equal to its maximum exposure to be remote and, accordingly, the Company has not recognized a liability associated with any portion of the maximum exposure to loss.

For the three months ended September 30, 2018, the Company incurred $1.2 million of costs in connection with the ELEAD1ONE acquisition and integration-related activities that were included within selling, general and administrative expenses, respectively.

Fiscal 2018 Acquisitions

Progressus Media LLC

On April 3, 2018, the Company acquired the membership interests of Progressus Media LLC ("Progressus"), a specialty provider of mobile advertising solutions for dealerships, agencies, and automotive marketing companies. The acquisition was made pursuant to a membership interest purchase agreement, which contains customary representations, warranties, covenants, and indemnities by the sellers and the Company. The acquisition date fair value of the total consideration transferred was $22.2 million which consists primarily of an initial cash price of $16.2 million, net of cash acquired, the fair value of the holdback provision of $0.3 million and the fair value of contingent consideration of $5.7 million, which is payable upon achievement of certain milestones and metrics over a three year period ending on March 31, 2021. Prior to the acquisition, a CDK officer had an existing advisory relationship with Progressus which entitled the individual to a portion of the proceeds from a sale of Progressus under a unit appreciation rights agreement. At the time of closing, $0.5 million of the total consideration transferred by CDK was paid to the officer to settle Progressus’ obligation under the terms of the officer’s unit appreciation rights agreement.

The fair value of acquired intangibles assets and other net assets was $8.7 million and $2.2 million, respectively. The excess of the acquisition consideration over the estimated fair value of the acquired net assets of $11.3 million was allocated to goodwill. The acquired net assets and goodwill are included in the RSNA segment. The intangible assets will be amortized over a weighted-average useful life of approximately 9 years. The goodwill recognized from this acquisition reflects expected synergies resulting from direct ownership of the products and processes, allowing greater flexibility for future product development. The acquired goodwill is deductible for tax purposes. As of June 30, 2018, the Company recorded $1.6 million of accrued expenses and other current liabilities and $4.4 million of other liabilities for the holdback and contingent consideration. The contingent consideration payments will be classified as financing activities on the statement of cash flows as the payments will occur more than three months after the acquisition date.

Dashboard Dealership Enterprises

On October 20, 2017, the Company acquired the outstanding stock of Dashboard Dealership Enterprises ("DDE"), a provider of executive reporting solutions for auto dealers. The acquisition was made pursuant to a stock purchase agreement, which contains customary representations, warranties, covenants, and indemnities by the sellers and the Company. The acquisition date fair value of total consideration to be transferred was $21.3 million, which consists primarily of an initial cash price of $12.8 million, the fair value of the holdback provision of $1.9 million, and the fair value of contingent consideration of $6.6 million, which is payable upon achievement of certain milestones and metrics if achieved by December 31, 2018. As of June 30, 2018, the Company recorded $7.6 million of accrued expenses and other current liabilities and $0.9 million of other liabilities for the holdback and contingent consideration.

The fair value of acquired intangibles assets and liabilities assumed, including deferred tax liabilities, was $3.9 million and $1.6 million, respectively. The excess of the acquisition consideration over the estimated fair value of the acquired assets of $19.0 million was allocated to goodwill. The acquired assets and goodwill are included in the RSNA segment. The intangible assets will be amortized over a weighted-average useful life of approximately 8 years. The goodwill recognized from this acquisition reflects expected synergies resulting from direct ownership of the products and processes, allowing greater flexibility for future product development. The acquired goodwill is not deductible for tax purposes.

The result of operations for Progresses and DDE have been included in the condensed consolidated results of operation from the date of acquisition. The pro forma effects of these acquisitions are not significant to the Company's reported results for any period presented. Accordingly, no pro forma financial statements have been presented herein.

Revenue

3 Months Ended

Sep. 30, 2018

Revenue from Contract with Customer [Abstract]

Revenue

A. Adoption of ASC 606, "Revenue from Contracts with Customers"

On July 1, 2018, the Company adopted ASC 606 applying the modified retrospective method to all contracts that were not completed as of July 1, 2018. For contracts that were modified before the effective date, the Company reflected the aggregate effect of all modifications when identifying performance obligations and allocating transaction price in accordance with the available practical expedient, which did not have a material effect on the adjustment to accumulated deficit. Results for reporting periods beginning after July 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period.

Upon adoption, recognition of revenue and costs for on-site licenses and installation was changed from recognition ratably over the software license term to recognition upon installation of the software. Additionally, the Company began deferring costs to obtain and costs to fulfill the contract which for the Company consists primarily of direct sales commissions and implementation costs for service arrangements. The cumulative effects of the changes made to the consolidated July 1, 2018 balance sheet for the adoption of ASC 606 were as follows:



	Balance at June 30, 2018		Adjustments due to ASC 606			Balance at July 1, 2018
Assets
Accounts receivable	$	374.6	$	2.6		$	377.2
Other current assets	188.3		(61.8		)	126.5
Other assets	165.5		112.8			278.3
Liabilities
Accrued expenses and other current liabilities	198.0		0.4			198.4
Short-term deferred revenues	169.0		(38.4		)	130.6
Long-term deferred revenues	110.4		(41.0		)	69.4
Deferred income taxes	56.7		23.2			79.9
Other liabilities	64.7		0.1			64.8
Stockholders' Deficit
Retained earnings	753.0		109.7			862.7
Accumulated other comprehensive income	11.5		(0.4		)	11.1

Impact on Consolidated Financial Statements



	Three Months Ended September 30, 2018
	As Reported ASC 606	Impact of ASC 606		ASC 605
Revenues	554.5	(11.4	)	565.9
Cost of revenues	281.6	(8.6	)	290.2
Selling, general and administrative expenses	98.3	(0.3	)	98.6
Total expenses	397.1	(8.9	)	406.0
Operating earnings	157.4	(2.5	)	159.9



Earnings before income taxes	127.8		(2.5	)	130.3
Provision for income taxes	(35.5	)	0.7		(36.2	)
Net earnings	92.3		(1.8	)	94.1
Net earnings attributable to CDK	90.3		(1.8	)	92.1
Net earnings attributable to CDK per common share:
Basic	0.70		(0.01	)	0.71
Diluted	0.69		(0.02	)	0.71



	September 30, 2018
	As Reported ASC 606	Impact of ASC 606		ASC 605
Assets
Accounts receivable	383.6	(3.0	)	380.6
Other current assets	115.6	55.7		171.3
Other assets	285.5	(116.7	)	168.8
Liabilities
Accrued expenses and other current liabilities	253.0	(3.7	)	249.3
Short-term deferred revenues	122.1	32.3		154.4
Long-term deferred revenues	68.6	34.5		103.1
Deferred income taxes	85.6	(20.0	)	65.6
Other liabilities	62.1	(0.2	)	61.9
Stockholders' Deficit
Retained earnings	933.6	(107.9	)	825.7
Accumulated other comprehensive income	5.1	1.0		6.1

B. Revenue Recognition

The Company determines the amount of revenue to be recognized through the following steps:


•	Identification of the contract, or contracts, with a customer;


•	Identification of the performance obligations in the contract;


•	Determination of the transaction price;


•	Allocation of the transaction price to the performance obligations in the contract; and


•	Recognition of revenue when, or as, the Company satisfies the performance obligations.

The majority of the Company’s revenue is generated from contracts with multiple performance obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company is required to estimate the total consideration expected to be received from contracts with customers. In limited circumstances, the consideration expected to be received may be variable based on the specific terms of the contract.

The Company rarely licenses or sells products or services on a standalone basis. As such, the Company is required to develop its best estimate of standalone selling price of each distinct good or service as the basis for allocating the total transaction price. The primary method used to estimate standalone selling price is the adjusted market assessment approach, with some product categories using the expected cost plus a margin approach. When establishing standalone selling price, the Company considers various factors which may include geographic region, current market trends, customer class, its market share and position, its general pricing practices for bundled products and services, and recent contract sales data.

The Company applies significant judgment in order to identify and determine the number of performance obligations, estimate the total transaction price, determine the allocation of the transaction price to each identified performance obligation, and determine the appropriate method and timing of revenue recognition.

Taxes collected from customers and remitted to governmental authorities are presented on a net basis; that is, such taxes are excluded from revenues.

The Company generates revenues from the following five categories: subscription, on-site licenses and installation, digital advertising, transaction services, and other. The Company does not evaluate a contract for a significant financing component if payment is expected within one year or less from the transfer of the promised items to the customer.

Subscription. In the RSNA and CDKI segments, CDK provides software and technology solutions for automotive retailers and OEMs, which includes:


•	Dealer Management Systems (“DMSs”) and layered applications, where the software is hosted and provided on a software-as-a-service (“SaaS”) basis;


•	Interrelated services such as installation, initial training, and data updates;


•	Ongoing maintenance and support related to on-site software;


•	Websites, search marketing, and reputation management services (RSNA only); and


•	Hardware on a service basis, meaning no specific assets are identified or a substantive right of substitution exists, that provides the customer continuous access to hardware owned by the Company.

SaaS and other hosted service arrangements, which allow the customer continuous access to the software over the contract period without taking possession, are provided on a subscription basis. The Company has concluded that under its SaaS and hosted service arrangements, the customer obtains access to the Company’s software which resides and is maintained on its managed servers. The customer does not obtain the right to take possession of the software. As such, the Company has concluded that its SaaS and hosted services arrangements do not include a software license. Furthermore, the Company has concluded that while the support and maintenance and hosting services are capable of being distinct performance obligations, the obligations are not distinct within the context of the contract. In addition, as the support and maintenance and hosting services are provided over the same period and have the same pattern of transfer of control, the support and maintenance and hosting services are combined and recognized as a single performance obligation. The Company may provide new customers with interrelated setup activities such as installation, initial training and data updates that the Company must undertake to fulfill the contract. These are considered fulfillment activities that do not transfer the service to the customer. In addition to the core DMS software application, the customer may also contract for layered applications, which are each considered a distinct performance obligation.

Revenues for SaaS and other hosted service arrangements, are recognized ratably over the duration of the contract. The Company has determined its obligation under these arrangements is to stand ready to perform the underlying services as required by the customer. The customer receives the benefit of the services and the Company has the right to payment as the services are performed. A time-elapsed output method is used to measure progress as the Company transfers control evenly over the duration of the contract.

On-site licenses and installation. In the RSNA and CDKI segments, on-site software arrangements include a license of intellectual property as the customer has the contractual right to take possession of the software and the customer can either run the software on its own hardware or contract with another party unrelated to the Company to host the software. The customer receives the right to use the software license upon its installation for the term of the arrangement. As such, the Company has concluded that the software license is a distinct performance obligations and recognized the transaction price allocated to on-site software upon installation. The Company also provides maintenance and support of the software applications. Such maintenance and support services may include server and desktop support, bug fixes, and support resolving other issues a customer may encounter in utilizing the software. Revenue allocated to support and maintenance is generally recognized ratably over the contract period as customers simultaneously consume and receive benefits, given the support and maintenance comprise distinct performance obligations that are satisfied ratably over time. A time-elapsed output method is used to measure progress as the Company transfers control evenly over the duration of the contract.

Advertising services. In the ANA segment, the Company receives revenues from the placement of internet advertising for automotive retailers and OEMs. Advertising contracts generally have a one year term and contain a single performance obligation recognized over time as the services are performed. The Company reports advertising revenues on a gross basis, that is, the amounts billed to our customers are recorded as revenues and amounts paid to publishers are recorded as cost of revenues. The Company provides a single optimized advertising service to its customers and controls the advertising, fulfills the advertising services, and establishes pricing.

Transaction revenues. The Company receives fees per transaction for providing auto retailers interfaces with third parties to process credit reports, vehicle registrations, and automotive equity mining. Transaction revenues are variable based on the volume of transactions processed. For these transaction revenues, the Company has a right to payment as the transactions are performed in an amount that corresponds directly with the value to the customer. As such, the Company

recognizes transaction revenues as the services are rendered and in the amount to which it has the right to invoice. Transaction revenues for credit report processing and automotive equity mining are recorded in revenues gross of costs incurred when the Company is substantively and contractually responsible for providing the service, software, and/or connectivity to the customer, and controls the specified good or service before it is transferred to the customer. The Company recognizes vehicle registration revenues net of the state registration fee when it is acting as an agent and does not control the related goods and services before they are transferred to the customer.

Other. The Company provides consulting and professional services, including mobile advertising and marketing campaign solutions, and sells hardware such as laser printers, networking and telephony equipment, and related items. Consulting and professional services are either billed on a time and materials basis or on a fixed monthly, quarterly or semi-annual basis based on the amount of services contracted. Revenue from these services are recorded when the Company’s obligation is satisfied. Where the Company’s obligation is to provide continuous services throughout the contract period and the customer receives the benefit of those services as they are performed, the Company recognizes these services revenues over time using a time-elapsed output method as the Company believes the passage of time faithfully depicts the transfer of services to its customers. Where the professional service represents a single performance obligation, the customer receives the benefit of the services only upon their completion, and the Company does not have the right to payment as the services are performed, such services revenue are recognized upon completion.

The Company often sells hardware bundled with maintenance services and has concluded that these bundles include two distinct performance obligations. The first performance obligation is to transfer the hardware product and the second performance obligation is to provide maintenance on the hardware and its embedded software. As such, the transaction price allocated to the sold hardware is recognized upon delivery at which point the customer is able to direct the use of, and obtain substantially all of the remaining benefits of the hardware. Upon delivery of the hardware, the Company generally has the right to payment, the customer has legal title, physical possession of, and control of the hardware. The transaction price allocated to the maintenance of hardware and its embedded software is recognized ratably over the duration of the contract as the customer simultaneously consumes and receives the benefit of this maintenance. The Company has determined its obligation under these arrangements is to stand ready to perform the underlying services as required by the customer. A time-elapsed output method is used to measure progress as the Company transfers control evenly over the duration of the contract. Hardware maintenance is included in subscription revenues.

C. Disaggregation of Revenue

The following table presents segment revenues by revenue category:



	Three Months Ended September 30, 2018
	Retail Solutions North America		Advertising North America		CDK International		Total
Revenue:
Subscription	$	334.3	$	—	$	66.6	$	400.9
On-site license and installation	1.4		—		8.0		9.4
Transaction	41.0		—		—		41.0
Advertising	—		65.8		—		65.8
Other	33.4		—		4.0		37.4
Total revenue	$	410.1	$	65.8	$	78.6	$	554.5

D. Contract Balances

The Company receives payments from customers based upon contractual billing schedules. Payment terms can vary by contract but the period between invoicing and when payments are due is not significant. The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in unbilled receivables (included in accounts receivable), contract assets, or contract liabilities, (included in deferred revenue), on the Company’s condensed consolidated balance sheet. Unbilled receivables (included in accounts receivable) are recorded when the right to consideration becomes unconditional based only on the passage of time. Contract assets include amounts related to our contractual right to consideration for completed performance when the right to consideration is conditional. The Company records contract liabilities when cash payments are received or due in advance of performance.

The following table provides information about accounts receivables, contract assets, and contract liabilities from contracts with customers:



	September 30, 2018	July 1, 2018
Accounts receivable (including unbilled receivables)	383.6	377.2
Short-term contract assets (included in other current assets)	31.0	28.0
Long-term contract assets (included in other assets)	23.3	26.0
Short-term contract liabilities (included in short-term deferred revenues)	122.1	130.6
Long-term contract liabilities (included in long-term deferred revenues)	68.6	69.4

During the three months ended September 30, 2018, the Company recognized $122.4 million in revenue which was included in deferred revenue in the accompanying condensed consolidated balance sheet as of July 1, 2018. During the three months ended September 30, 2018, $113.3 million was invoiced and removed from contract assets in the accompanying condensed consolidated balance sheet as of July 1, 2018. The Company had no asset impairment charges related to contract assets in the period.

The Company may occasionally recognize an adjustment in revenue in the current period for performance obligations partially or fully satisfied in the previous periods resulting from changes in estimates for the transaction price, including any changes to our assessment of whether an estimate of variable consideration is constrained. For the three months ended September 30, 2018, the impact on revenue recognized in the current period, from performance obligations partially or fully satisfied in the previous period, was not significant.

E. Remaining Performance Obligations

As of September 30, 2018, the Company had $2.9 billion of remaining performance obligations which represent contracted revenue that has not yet been recognized, including contracted revenue where the contracts original expected duration is one year or less. We expect to recognize approximately $840 million of the remaining performance obligation as revenue during the remainder of fiscal 2019, $820 million for the fiscal year ended June 30, 2020, $580 million for the fiscal year ended June 30, 2021, and $370 million for the fiscal year ended June 30, 2022. We expect to recognize the remaining $290 million as revenue thereafter. The remaining performance obligations exclude future transaction revenue where revenue is recognized as the services are rendered and in the amount to which the Company has the right to invoice.

F. Costs to Obtain and Fulfill a Contract

In connection with the adoption of ASC 606, the Company capitalizes certain contract acquisition costs consisting primarily of commissions incurred when contracts are signed. The Company does not capitalize commissions related to contracts with a duration of less than one year; such commissions are expensed within selling, general and administrative expenses when incurred. Costs to fulfill contracts are capitalized when such costs are direct, incremental, and related to transition or installation activities for hosted software solutions. Capitalized costs to fulfill primarily include travel and employee compensation and benefit related costs for the Company's implementation and training teams. Capitalized costs to obtain a contract and most costs to fulfill a contract are amortized over a period of five years which represents the expected period of benefit of these costs. In instances where the contract term is significantly less than five years, costs to fulfill are amortized over the contract term which the Company believes best reflects the period of benefit of these costs.

As of July 1, 2018, the company capitalized $193.4 million in contract acquisition and fulfillment costs. Management expects that incremental commission fees incurred as a result of obtaining contracts and fulfillment costs are recoverable and, therefore, the Company recognized a deferred cost asset in the amount of $194.8 million as of September 30, 2018. During the three months ended September 30, 2018, $19.5 million of cost amortization was recognized and there were no significant impairment losses.

Restructuring

3 Months Ended

Sep. 30, 2018

Restructuring and Related Activities [Abstract]

Restructuring

During the fiscal year ended June 30, 2015 ("fiscal 2015"), the Company initiated a business transformation plan intended to increase operating efficiency and improve the Company's cost structure within its global operations through its completion in fiscal 2019. The Company estimated cost to execute the plan through fiscal 2019 to be approximately $100.0 million.

Restructuring expenses associated with the business transformation plan included employee-related costs, which represent severance and other termination-related benefits calculated based on long-standing benefit practices and local statutory requirements, and contract termination costs, which include costs to terminate facility leases. The Company recognized $17.2 million and $6.5 million of restructuring expenses for the three months ended September 30, 2018 and 2017, respectively. Since the inception of the business transformation plan in the fourth quarter of fiscal 2015, the Company has recognized cumulative restructuring expenses of $79.1 million. Restructuring expenses are presented separately on the condensed consolidated statements of operations. Restructuring expenses are recorded in the Other segment, as these initiatives are predominantly centrally directed and are not included in internal measures of segment operating performance.

Accruals for restructuring expenses were included within accrued expenses and other current liabilities on the condensed consolidated balance sheets as of September 30, 2018 and June 30, 2018. The following table summarizes the activity for the restructuring accrual for the three months ended September 30, 2018:



	Employee-Related Costs			Contract Termination Costs			Total Costs
Balance as of June 30, 2018	$	4.4		$	0.8		$	5.2
Charges	17.2			—			17.2
Cash payments	(11.9		)	(0.1		)	(12.0		)
Balance as of September 30, 2018	$	9.7		$	0.7		$	10.4

Earnings per Share

3 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Earnings per Share

The numerator for both basic and diluted earnings per share is net earnings attributable to CDK. The denominator for basic and diluted earnings per share is based upon the weighted-average number of shares of the Company's common stock outstanding during the reporting periods. Diluted earnings per share also reflects the dilutive effect of unexercised in-the-money stock options and unvested restricted stock.

Holders of certain stock-based compensation awards are eligible to receive dividends as described in Note 10. Net earnings allocated to participating securities were not significant for the three months ended September 30, 2018 and 2017.

The following table summarizes the components of basic and diluted earnings per share:



	Three Months Ended
	September 30,
	2018		2017
Net earnings attributable to CDK	$	90.3	$	81.3

Weighted-average shares outstanding:
Basic	129.6		140.1
Effect of employee stock options	0.3		0.4
Effect of employee restricted stock	0.5		0.9
Diluted	130.4		141.4

Basic earnings attributable to CDK per share	$	0.70	$	0.58
Diluted earnings attributable to CDK per share	$	0.69	$	0.57

The weighted-average number of shares outstanding used in the calculation of diluted earnings per share does not include the effect of the following anti-dilutive securities.



	Three Months Ended
	September 30,
	2018	2017
Stock-based awards	0.2	0.4

Goodwill and Intangible Assets, Net

3 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets, Net

In first the quarter fiscal 2019, the Company revised segment reporting to reclassify the assets and liabilities and operating results of the April 2018 acquisition of Progressus Media LLC to the RSNA segment. The results were previously reported in the ANA segment. Goodwill has been restated as of June 30, 2018 to reflect the reclassification of the assets and liabilities for this acquisition.

Changes in goodwill for the three months ended September 30, 2018 were as follows:



	Retail Solutions North America		Advertising North America		CDK International			Total
Balance as of June 30, 2018	$	634.6	$	214.3	$	368.3		$	1,217.2
Additions (Note 4)	378.3		—		—			378.3
Currency translation adjustments	0.4		—		(3.5		)	(3.1		)
Balance as of September 30, 2018	$	1,013.3	$	214.3	$	364.8		$	1,592.4

The Company performs its annual impairment testing for goodwill balances as of April 1 each year; however, the Company may test for impairment between annual tests if an event occurs or circumstances change that indicate that the fair value of the reporting unit may fall below its carrying amount. During fiscal 2018, the ANA segment and reporting unit was at risk of failing step one of the goodwill impairment test. The impairment test indicated that the fair value of the reporting unit exceeded the carrying value by less than 10%. Declines in advertising revenue from certain OEM contracts and changes in revenue mix were the primary drivers of the decline in fair value. In the first quarter of fiscal 2019, ANA updated its estimates regarding operating results and growth rate due to continued changes to the business primarily related to certain OEM contracts. Therefore, the Company determined that the carrying amount of goodwill should be evaluated for impairment at September 30, 2018. The impairment test indicated that the fair value of the ANA reporting unit exceeds its carrying value by approximately 7% which is lower than the fourth quarter of fiscal 2018. No goodwill impairment was recorded. The valuation of the reporting unit requires significant judgment and is highly sensitive to underlying assumptions including forecasted revenue growth and operating earnings and discount rates. Further declines in advertising revenue or changes in advertising revenue mix could negatively impact the estimated fair value and result in an impairment for the reporting unit which could be material to consolidated earnings. Details on the fair value computation are included in our Annual Report on Form 10-K in the Critical Accounting Policies section of Management's Discussion and Analysis of Financial Condition and Results of Operations.

Components of intangible assets, net were as follows:



	September 30, 2018							June 30, 2018
	Original Cost		Accumulated Amortization			Intangible Assets, net		Original Cost		Accumulated Amortization			Intangible Assets, net
Software	$	260.9	$	(129.6	)	$	131.3	$	208.6	$	(124.3	)	$	84.3
Customer lists	262.5		(144.2		)	118.3		181.3		(142.4		)	38.9
Trademarks	32.2		(24.7		)	7.5		25.0		(24.6		)	0.4
Other intangibles	6.3		(3.6		)	2.7		6.9		(4.0		)	2.9
	$	561.9	$	(302.1	)	$	259.8	$	421.8	$	(295.3	)	$	126.5

Other intangibles primarily consist of purchased rights, covenants, and patents (acquired directly or through acquisitions). All of the intangible assets have finite lives and, as such, are subject to amortization. The weighted-average remaining useful life of intangible assets is 8 years (5 years for software and software licenses, 12 years for customer lists, and 7 years for trademarks). Amortization of intangible assets was $7.1 million and $8.0 million for the three months ended September 30, 2018 and 2017, respectively.

Estimated amortization expenses of the Company's existing intangible assets as of September 30, 2018 were as follows:



	Amount
Nine months ending June 30, 2019	$	31.7
Twelve months ending June 30, 2020	46.0
Twelve months ending June 30, 2021	41.8
Twelve months ending June 30, 2022	34.0
Twelve months ending June 30, 2023	18.9
Twelve months ending June 30, 2024	15.1
Thereafter	72.3
	$	259.8

- 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

Debt

3 Months Ended

Sep. 30, 2018

Debt Disclosure [Abstract]

Debt

Debt was comprised of the following:



	September 30, 2018			June 30, 2018
Revolving credit facility	$	260.0		$	—
Three year term loan facility, due 2021	300.0			—
Five year term loan facility, due 2023	300.0			—
2019 term loan facility	—			203.1
2020 term loan facility	—			218.8
2021 term loan facility	—			370.0
3.30% senior notes, due 2019	250.0			250.0
4.50% senior notes, due 2024	500.0			500.0
5.875% senior notes, due 2026	500.0			500.0
4.875% senior notes, due 2027	600.0			600.0
Capital lease obligations	6.1			0.2
Unamortized debt financing costs	(24.6		)	(21.4		)
Total debt and capital lease obligations	2,691.5			2,620.7
Current maturities of long-term debt and capital lease obligations	17.9			45.2
Total long-term debt and capital lease obligations	$	2,673.6		$	2,575.5

Revolving Credit Facility

On August 17, 2018, the Company entered into a five-year senior unsecured revolving credit facility. The credit facility replaced the previous unsecured revolving credit facility agreement, which was undrawn as of June 30, 2018. The revolving credit facility provides up to $750.0 million of borrowing capacity and includes a sub-limit of up to $100.0 million for loans in Euro, Pound Sterling, and, if approved by the revolving lenders, other currencies. The Company drew $260.0 million of the $750.0 million as of September 30, 2018. In addition, the revolving credit facility contains an accordion feature that allows for an increase in the available borrowing capacity of up to $100.0 million, subject to the agreement of lenders under the revolving credit facility or other financial institutions that become lenders to extend commitments as part of the increased revolving credit facility. Borrowings under the revolving credit facility are available for general corporate purposes. The revolving credit facility will mature on August 17, 2023, subject to no more than two one-year extensions if lenders holding a majority of the revolving commitments approve such extensions.

The revolving credit facility is unsecured and loans thereunder bear interest, at the Company's option, at (a) the rate at which deposits in the applicable currency are offered in the London interbank market plus margins varying from 1.250% to 2.375% per annum based on the Company's senior, unsecured non-credit-enhanced, long-term debt ratings from Standard & Poor's Ratings Group, Moody's Investors Services Inc., and Fitch Ratings (the "Ratings") or (b) solely in the case of U.S. dollar loans, (i) the highest of (A) the prime rate of Bank of America, N.A., (B) a rate equal to the average of the overnight federal

funds rate with a maturity of one day plus a margin of 0.500% per annum and (C) the rate at which dollar deposits are offered in the London interbank market for a one-month interest period plus 1.000% plus (ii) margins varying from 0.250% to 1.375% per annum based on the Ratings. The unused portion of the revolving credit facility is subject to commitment fees ranging from 0.150% to 0.350% per annum based on the Ratings. The interest rate per annum on the revolving credit facility as of September 30, 2018 was 3.795%.

Term Loan Facilities

On August 17, 2018, the Company entered into a term loan agreement which provided the Company with an aggregate of $600.0 million of term loans comprised of a $300.0 million term loan that will mature on August 17, 2021 (the "three year term loan facility") and a $300.0 million term loan that will mature on August 17, 2023 (the "five year term loan facility"). The aggregate principal amount of the three year term loan facility will be repayable in full on the maturity date. The five year term loan facility is subject to amortization in equal quarterly installments of 1.25% of the aggregate principal amount made on the closing date, with any unpaid principal amount to be due and payable on the maturity date. The three year term loan facility and the five year term loan facility are together referred to as the "term loan facilities."

The three year term loan facility bears interest (i) at the rate at which deposits in the applicable currency are offered in the London interbank market plus margins varying from 1.125% to 2.250% per annum based on the Company’s ratings or (ii) the highest of (X) a rate equal to the average of the overnight federal funds rate with a maturity of one day plus a margin of 0.500% per annum, (Y) the prime rate of Bank of America, N.A. and (Z) the rate at which dollar deposits are offered in the London interbank market for a one-month interest period plus 1.000%, plus margins varying from 0.125% to 1.250% per annum based on the Ratings, and (b) with respect to the five year term loan facility (i) at the rate at which deposits in the applicable currency are offered in the London interbank market plus margins varying from 1.250% to 2.375% per annum based on the Company’s Ratings or (ii) the highest of (X) a rate equal to the average of the overnight federal funds rate with a maturity of one day plus a margin of 0.500% per annum, (Y) the prime rate of Bank of America, N.A. and (Z) the rate at which dollar deposits are offered in the London interbank market for a one-month interest period, plus 1.000%, plus margins varying from 0.250% to 1.375% per annum based on the ratings. The interest rate per annum on the three year term loan facility and five year term loan facility as of September 30, 2018 was 3.75% and 3.88%, respectively.

On August 17, 2018, the Company voluntarily paid off all of the outstanding principal, interest and related fees using the proceeds of the term loan facilities and cash on hand, with respect to each of the two $250.0 million senior unsecured term loan facilities that mature on September 16, 2019 (the "2019 term loan facility") and December 14, 2020 (the "2020 term loan facility"), and the $400.0 million senior unsecured term loan facility that matures on December 9, 2021 (the "2021 term loan facility"). The interest rate per annum on the 2019, 2020, and 2021 term loan facilities was 3.85% as of June 30, 2018.

Restrictive Covenants and Other Matters

The revolving credit facility and the term loan facilities are together referred to as the "credit facilities." The credit facilities contain various covenants and restrictive provisions that limit the Company's subsidiaries' ability to incur additional indebtedness; the Company's ability to consolidate or merge with other entities; and the Company's subsidiaries' ability to incur liens, enter into sale and leaseback transactions, and enter into agreements restricting the ability of the Company's subsidiaries to pay dividends. If the Company fails to perform the obligations under these and other covenants, the revolving credit facility could be terminated and any outstanding borrowings, together with accrued interest, under the credit facilities could be declared immediately due and payable. The credit facilities also have, in addition to customary events of default, an event of default triggered by the acceleration of the maturity of any other indebtedness the Company may have in an aggregate principal amount in excess of $75.0 million.

The credit facilities also contain financial covenants that will provide that (i) the ratio of total consolidated indebtedness to consolidated EBITDA shall not exceed 3.75 to 1.00 and (ii) the ratio of consolidated EBITDA to consolidated interest expense shall be a minimum of 3.00 to 1.00.

Senior Notes

On October 14, 2014, the Company completed an offering of 3.30% unsecured senior notes with a $250.0 million aggregate principal amount due in 2019 (the "2019 notes") and 4.50% senior notes with a $500.0 million aggregate principal amount due in 2024 (the "2024 notes"). The issuance price of the 2019 and 2024 notes was equal to the stated value. Interest is payable semi-annually on April 15 and October 15 of each year, and payment commenced on April 15, 2015. The interest rate payable on each applicable series of 2019 and 2024 notes is subject to adjustment from time to time if the credit ratings

assigned to any series of 2019 and 2024 notes by the rating agencies is downgraded (or subsequently upgraded). The 2019 notes will mature on October 15, 2019, and the 2024 notes will mature on October 15, 2024. The 2019 notes and 2024 notes are redeemable at the Company's option prior to September 15, 2019 for the 2019 notes and prior to July 15, 2024 for the 2024 notes at a redemption price equal to the greater of (i) 100% of the aggregate principal amount of the 2019 notes or 2024 notes to be redeemed, and (ii) the sum of the present value of the remaining scheduled payments (as defined in the agreement), plus in each case, accrued and unpaid interest thereon. Subsequent to September 15, 2019 and July 15, 2024, the redemption price for the 2019 notes and the 2024 notes, respectively, will equal 100% of the aggregate principal amount of the notes redeemed, plus accrued and unpaid interest thereon.

On June 18, 2018, the Company completed an offering of 5.875% unsecured senior notes with a $500.0 million aggregate principal amount due in 2026 (the "2026 notes"). The issuance price of the 2026 notes was equal to the stated value. Interest is payable semi-annually on June 15 and December 15 of each year, and payment will commence on December 15, 2018. The 2026 notes will mature on June 15, 2026. The 2026 notes are redeemable at the Company's option prior to June 15, 2021 in whole or in part at a redemption price equal to 100% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, plus the applicable "make-whole" premium. Subsequent to June 15, 2021, the Company may redeem the 2026 notes at a price equal to: (i) 102.938% of the aggregate principal amount of the 2026 notes redeemed prior to June 15, 2022; (ii) 101.958% of the aggregate principal amount of the notes redeemed on or after June 15, 2022 but prior to June 15, 2023; (iii) 100.979% of the aggregate principal amount of the 2026 notes redeemed on or after June 15, 2023 but prior to June 15, 2024; and (iv) 100.000% of the aggregate principal amount of the 2026 notes redeemed thereafter.

On May 15, 2017, the Company completed an offering of 4.875% unsecured senior notes with a $600.0 million aggregate principal amount due in 2027 (the "2027 notes," together with the 2024 notes, the 2019 notes, and the 2026 notes are the "senior notes"). The issuance price of the 2027 notes was equal to the stated value. Interest is payable semi-annually on June 1 and December 1 of each year, and payment will commence on December 1, 2017. The 2027 notes will mature on June 1, 2027. The 2027 notes are redeemable at the Company's option prior to June 1, 2022 in whole or in part at a redemption price equal to 100% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, plus the applicable "make-whole" premium. Subsequent to June 1, 2022, the Company may redeem the 2027 notes at a price equal to: (i) 102.438% of the aggregate principal amount of the 2027 notes redeemed prior to June 1, 2023; (ii) 101.625% of the aggregate principal amount of the notes redeemed on or after June 1, 2023 but prior to June 1, 2024; (iii) 100.813% of the aggregate principal amount of the 2027 notes redeemed on or after June 1, 2024 but prior to June 1, 2025; and (iv) 100.000% of the aggregate principal amount of the 2027 notes redeemed thereafter.

The senior notes are general unsecured obligations of the Company and are not guaranteed by any of the Company's subsidiaries. The senior notes rank equally in right of payment with the Company's existing and future unsecured unsubordinated obligations, including the credit facilities. The senior notes contain covenants restricting the Company's ability to incur additional indebtedness secured by liens, engage in sale/leaseback transactions, and merge, consolidate, or transfer all or substantially all of the Company's assets.

The senior notes are also subject to a change of control provision whereby each holder of the senior notes has the right to require the Company to purchase all or a portion of such holder's senior notes at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest upon the occurrence of both a change of control and a decline in the rating of the senior notes.

In November 2016, Moody's and S&P lowered their credit ratings on the senior notes to Ba1 (Stable Outlook) from Baa3 (Negative Outlook) and to BB+ (Stable Outlook) from BBB- (Negative Outlook), respectively. The downgrades triggered interest rate adjustments for the 2019 and 2024 notes. Interest rates for the 2019 and 2024 notes increased to 3.80% from 3.30%, and to 5.00% from 4.50%, respectively, effective October 15, 2016.

Capital Lease Obligations

The Company has lease agreements for equipment, which are classified as capital lease obligations. The Company recognized the capital lease obligations and related leased equipment assets based on the present value of the minimum lease payments at lease inception.

Unamortized Debt Financing Costs

As of September 30, 2018 and June 30, 2018, gross debt issuance costs related to debt instruments were $34.0 million and $29.6 million, respectively. Accumulated amortization was $9.4 million and $8.2 million as of September 30, 2018 and

June 30, 2018, respectively. Debt financing costs are amortized over the terms of the related debt instruments to interest expense on the condensed consolidated statements of operations.

The Company's aggregate scheduled maturities of the long-term debt and capital lease obligations as of September 30, 2018 were as follows:



	Amount
Twelve months ending September 30, 2019	$	17.9
Twelve months ending September 30, 2020	266.7
Twelve months ending September 30, 2021	316.5
Twelve months ending September 30, 2022	15.0
Twelve months ending September 30, 2023	500.0
Thereafter	1,600.0
Total debt and capital lease obligations	2,716.1
Unamortized debt financing costs	(24.6		)
Total debt and capital lease obligations, net of unamortized debt financing costs	$	2,691.5

Stock-Based Compensation

3 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Incentive Equity Awards Granted by the Company

The 2014 Omnibus Award Plan ("2014 Plan") provides for the granting of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards, and performance compensation awards to employees, directors, officers, consultants, and advisors, and those of the Company's affiliates. The 2014 Plan provides for an aggregate of 12.0 million shares of the Company's common stock to be reserved for issuance and is effective for a period of ten years. The Company reissues treasury stock to satisfy issuances of common stock upon option exercise, equity vesting, or grants of time-based restricted stock.

On October 1, 2014, Automatic Data Processing, Inc. (“ADP”) distributed 100% of the common stock of the Company to the holders of record of Automatic Data Processing, Inc. (“ADP”) common stock as of September 24, 2014 (the "spin-off"). Prior to the spin-off, all employee equity awards (stock options and restricted stock) were granted by ADP. All subsequent awards, including all incentive equity awards converted from ADP awards, were granted under the 2014 Plan.

The Company recognizes stock-based compensation expense associated with employee equity awards in net earnings based on the fair value of the awards on the date of grant. The Company accounts for forfeitures as they occur. Stock-based compensation primarily consisted of the following for the three months ended September 30, 2018 and 2017:

Stock Options. Stock options are granted to employees at exercise prices equal to the fair market value of the Company's common stock on the date of grant. Stock options are issued under a graded vesting schedule and generally have a term of ten years. Compensation expense is measured based on the fair value of the stock option on the grant date and recognized over the requisite service period for each separately vesting portion of the stock option award. Upon termination of employment, unvested stock options are evaluated for forfeiture or modification, subject to the terms of the awards and Company policies.

Time-Based Restricted Stock and Time-Based Restricted Stock Units. Time-based restricted stock and restricted stock units generally vest over a two to five-year period. Upon termination of employment, unvested stock options are evaluated for forfeiture or modification, subject to the terms of the awards and Company policies.

Time-based restricted stock cannot be transferred during the vesting period. Compensation expense related to the issuance of time-based restricted stock is measured based on the fair value of the award on the grant date and recognized on a straight-line basis over the vesting period. Employees are eligible to receive cash dividends on the CDK shares awarded under the time-based restricted stock program during the restricted period.

Time-based restricted stock units are primarily settled in cash, for non-U.S. recipients, and may be settled in stock or cash for U.S. recipients at the discretion of the Company. Compensation expense related to the issuance of time-based restricted

stock units is recorded over the vesting period and is initially based on the fair value of the award on the grant date. Cash-settled, time-based restricted stock units are subsequently remeasured at each reporting date during the vesting period to the current stock value. For grants made prior to September 6, 2018, no dividend equivalents are paid on units awarded during the restricted period. For grants made on or subsequent to September 6, 2018, U.S. recipients are credited with dividend equivalents on units awarded during the restricted period, and no dividend equivalents are paid or credited on units awarded to non-U.S. recipients during the restricted period.

Performance-Based Restricted Stock Units. Performance-based restricted stock units generally vest over a three-year performance period. Under these programs, the Company communicates "target awards" at the beginning of the performance period with possible payouts at the end of the performance period ranging from 0% to 260% of the "target awards" plus any dividend equivalents, as described below. Certain performance-based restricted stock units are further subject to adjustment (increase or decrease) based on a market condition defined as the total shareholder return of the Company's common stock compared to a peer group of companies.

Performance-based restricted stock units are settled in either cash or stock for employees whose home country is the U.S. at the discretion of the Company and are settled in cash for all other employees and cannot be transferred during the vesting period. Compensation expense related to the issuance of performance-based restricted stock units settled in cash is recorded over the vesting period, is initially based on the fair value of the award on the grant date, and is subsequently remeasured at each reporting date to the current stock value during the performance period, based upon the probability that the performance target will be met. Compensation expense related to the issuance of performance-based restricted stock units settled in stock is recorded over the vesting period based on the fair value of the award on the grant date. Prior to settlement, dividend equivalents are earned on "target awards" under the performance-based restricted stock unit program.

The following table represents stock-based compensation expense and the related income tax benefits for the three months ended September 30, 2018 and 2017, respectively:



	Three Months Ended
	September 30,
	2018		2017
Cost of revenues	$	0.5	$	1.1
Selling, general and administrative expenses	2.8		7.0
Total pre-tax stock-based compensation expense	$	3.3	$	8.1

Income tax benefit	$	0.8	$	2.8

Stock-based compensation expense for the three months ended September 30, 2018 consisted of $3.8 million of expense related to equity classified awards and $0.5 million of income related to liability classified awards. Stock-based compensation expense for the three months ended September 30, 2017 includes additional expense based on management's assessment that it was probable CDK's performance metrics for fiscal 2018 associated with performance-based restricted stock units would exceed target.

As of September 30, 2018, the total unrecognized compensation cost related to non-vested stock options, restricted stock units, and restricted stock awards was $1.4 million, $35.4 million, and $5 million, respectively, which will be amortized over the weighted-average remaining requisite service periods of 2.7 years, 2.1 years, and 1.3 years, respectively.

The activity related to the Company's incentive equity awards from June 30, 2018 to September 30, 2018 consisted of the following:

Stock Options



	Number of Options (in thousands)		Weighted Average Exercise Price (in dollars)
Options outstanding as of June 30, 2018	957		$	44.25
Options granted	—		—
Options exercised	(37	)	28.23
Options canceled	(2	)	43.54
Options outstanding as of September 30, 2018	918		$	44.89

Time-Based Restricted Stock and Time-Based Restricted Stock Units



	Number of Shares (in thousands)		Number of Units (in thousands)
Non-vested restricted units/shares as of June 30, 2018	379		142
Restricted shares/units granted	2		278
Restricted shares/units vested	(160	)	(42	)
Restricted shares/units forfeited	(33	)	(4	)
Non-vested restricted units/shares as of September 30, 2018	188		374

Performance-Based Restricted Stock Units



	Number of Units (in thousands)
Non-vested restricted units as of June 30, 2018	411
Restricted units granted	106
Dividend equivalents	—
Restricted units vested	(9	)
Restricted units forfeited	(19	)
Non-vested restricted units as of September 30, 2018	489

The Monte Carlo simulation model used to determine the grant date fair value of the three-year performance based restricted stock units granted in the three months ended September 30, 2018 used an expected volatility based on historical stock price volatility for the Company and the peer companies, the average of which was 20.40% and a risk-free interest rate of 2.68%. Because these awards earn dividend equivalents, the model did not assume an expected dividend yield.

Income Taxes	3 Months Ended
Income Taxes	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Tax Cuts and Jobs Act of 2017 On December 22, 2017, the Tax Cuts and Jobs Act ("Tax Reform Act") was enacted into law. The Tax Reform Act significantly revises the U.S. corporate income tax laws by, among other things, reducing the corporate income tax rate from 35.0% to 21.0% and implementing a modified territorial tax system that includes a one-time transition tax on accumulated undistributed foreign earnings. Other provisions included in the Tax Reform Act include the broadening of the executive compensation deduction limitation, a repeal of the domestic production activity deduction and several new international provisions. The modified territorial tax system includes a new anti-deferral provision, referred to as global intangible low taxed income (“GILTI”), which subjects certain foreign income to current U.S. tax. The ultimate impact of the Tax Reform Act may differ from the Company’s estimates due to the issuance of additional regulatory guidance, the interpretation of the Tax Reform Act evolving over time and actions taken by the Company as a result of the Tax Reform Act. Tax Matters Agreement The Company and ADP entered into a tax matters agreement as part of the spin-off that governs the rights and obligations of both parties after the spin-off with respect to taxes for both pre and post spin-off periods. In accordance with the tax matters agreement, the Company recognized a net gain of $0.8 million in the three months ended September 30, 2017 in other income, net in the condensed consolidated statements of operations associated with an indemnification receivable from ADP for pre spin-off tax periods. Valuation Allowance The Company had valuation allowances of $21.0 million and $21.6 million as of September 30, 2018 and June 30, 2018, respectively, because the Company has concluded it is more likely than not that it will be unable to utilize net operating and capital loss carryforwards of certain subsidiaries to offset future taxable earnings. As of each reporting date, the Company’s management considers new evidence, both positive and negative, which could impact management’s view with regard to future realization of deferred tax assets. During the three months ended September 30, 2018, the valuation allowance balance was decreased primarily due to the utilization of loss carryforwards and the adoption of ASC 606. Unrecognized Income Tax Benefits As of September 30, 2018 and June 30, 2018, the Company had unrecognized income tax benefits of $6.4 million and $6.2 million, respectively, of which $5.5 million and $5.3 million, respectively, would impact the effective tax rate if recognized. During the three months ended September 30, 2018, the Company increased its unrecognized income tax benefits related to current tax positions by $0.2 million based on information that indicates the extent to which certain tax positions are more likely than not of being sustained. Provision for Income Taxes The effective tax rate for the three months ended September 30, 2018 and 2017 was 27.8% and 30.6%, respectively. The effective tax rate for the three months ended September 30, 2018 was favorably impacted by a lower federal statutory tax rate, offset by a $3.4 million deferred tax charge associated with executive compensation limitations. The effective tax rate for the three months ended September 30, 2018 and 2017 were favorably impacted by $1.9 million and $3.4 million of excess tax benefits, respectively.

Commitments and Contingencies

3 Months Ended

Sep. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

The Company is subject to various claims and litigation in the normal course of business. When a loss is considered probable and reasonably estimable, the Company records a liability in the amount of its best estimate for the ultimate loss. There can be no assurance that these matters will be resolved in a manner that is not adverse to the Company.

In the normal course of business, the Company may enter into contracts in which it makes representations and warranties that relate to the performance of the Company’s services and products. The Company does not expect any material losses related to such representations and warranties.

Legal Proceedings

From time to time, the Company is involved in legal, regulatory, and arbitration proceedings concerning matters arising in connection with the conduct of its business activities. Such proceedings can be expensive and disruptive to normal business operations. When losses are considered probable and reasonably estimable, the Company records a liability in the amount of its best estimate for the ultimate loss. At this time, the Company is unable to reasonably estimate any reasonably possible loss or ranges of losses on the matters and proceedings described below for a variety of reasons, including, among others: (i) the proceedings being in the relatively early stages; (ii) uncertainty as to the outcome of pending or anticipated appeals, motions, counterclaims, or settlements; (iii) significant factual issues remain to be resolved; and (iv) the novel or uncertain nature of the legal issues presented.

Competition Matters

The Company is involved in multiple lawsuits that set forth allegations of anti-competitive agreements between the Company and The Reynolds and Reynolds Company ("Reynolds and Reynolds") relating to the manner in which the defendants control access to, and allow integration with, their respective DMSs. The Company has also received from the Federal Trade Commission ("FTC") a Civil Investigative Demand consisting of a request to produce documents relating to any agreement between the Company and Reynolds and Reynolds.

The following antitrust lawsuits have been transferred to, or filed as part of the U.S. District Court for the Northern District of Illinois for consolidated or coordinated for pretrial proceedings as part of a Multi-District Litigation proceeding (“MDL”). Currently, the parties to the MDL are engaged in preliminary proceedings and document discovery. Each of these lawsuits seeks, among other things, treble damages and injunctive relief.

•

Motor Vehicle Software Corporation (“MVSC”) brought a suit against the Company, Reynolds and Reynolds, and Computerized Vehicle Registration (“CVR”), a majority owned joint venture of the Company. MVSC’s suit was originally filed in the U.S. District Court for the Central District of California on February 3, 2017. Defendants’ motions to dismiss MVSC’s second amended complaint was denied.


•	Authenticom, Inc. brought a suit against CDK Global, LLC (the Company’s operating subsidiary), and Reynolds and Reynolds. Authenticom’s suit was originally filed in the U.S. District Court for the Western District of Wisconsin on May 1, 2017. Defendants’ motions to dismiss were granted in part, and dismissed in part.

•

Teterboro Automall, Inc. d/b/a Teterboro Chrysler Dodge Jeep Ram (“Teterboro”) brought a putative class-action suit against CDK Global, LLC and Reynolds and Reynolds. Teterboro’s suit was originally filed in the U.S. District Court for the District of New Jersey on October 19, 2017. Since that time, several more putative class actions have been filed in a variety of Federal District Courts, with substantively similar allegations; all of them have been consolidated with the MDL proceeding. On June 4, 2018, a Consolidated Class Action Complaint was filed on behalf of a putative class made up of all dealerships in the United States that directly or indirectly purchase DMS or data integration services from CDK or Reynolds and Reynolds. The Company has moved to dismiss the complaint, or in the alternative, compel arbitration of certain of the cases while staying the remainder pending the outcome of those arbitration proceedings. On October 23, 2018, the putative Dealership Class Plaintiffs and Reynolds and Reynolds filed a Motion for Preliminary Approval of Settlement and for Conditional Certification of the Proposed Settlement Class. Reynolds concurrently withdrew its previously filed motion to compel arbitration of the Dealership class action (or, in the alternative, to dismiss) as moot.


•	Cox Automotive, along with multiple subsidiaries (“Cox”), brought suit against CDK Global, LLC. Cox’s suit was originally filed in the U.S. District Court for the Western District of Wisconsin, on December 11, 2017. CDK Global, LLC has moved to dismiss Cox’s claims; that motion is currently under consideration by the court.

•

Loop LLC d/b/a Autoloop (“Autoloop”) brought suit against CDK Global, LLC in the U.S. District Court for the Northern District of Illinois on April 9, 2018, but reserved its rights with respect to remand to the U.S. District Court for the Western District of Wisconsin at the conclusion of the MDL proceedings. On June 5, 2018, Autoloop amended its complaint as a putative class action on behalf of itself and all other similarly situated vendors. CDK Global, LLC has moved to dismiss Autoloop's claims; that motion is currently under consideration by the court.

The Company believes that these cases are without merit and intends to continue to contest the claims in these cases vigorously. Legal and expert fees may be significant, and an adverse result in these suits could have a material adverse effect on the Company's business, results of operations, financial condition, or liquidity.

On June 22, 2017, the Company received from the FTC a Civil Investigative Demand consisting of interrogatories and a request to produce documents relating to any agreements between the Company and Reynolds and Reynolds. Subsequently, parallel requests have been received from certain states' Attorneys General. The Company is responding to the requests. The requests merely seek information, and no proceedings have been instituted. The Company believes there has not been any conduct by the Company or its current or former employees that would be actionable under the antitrust laws in connection with the agreements between ourselves and Reynolds and Reynolds or otherwise. At this time, the Company does not have sufficient information to predict the outcome of, or the cost of responding to or resolving these investigations.

Other Proceedings

The Company is otherwise involved from time to time in other proceedings not described above. Based on information available at this time, the Company believes that the resolution of these other matters currently pending will not individually or in the aggregate have a material adverse effect on our business, results of operations, financial condition, or liquidity. The Company's view of these matters may change as the proceedings and events related thereto unfold.

Other Contingencies

The Company has provided approximately $25.3 million of guarantees as of September 30, 2018 in the form of surety bonds issued to support certain licenses and contracts which require a surety bond as a guarantee of performance of contractual obligations. In general, the Company would only be liable for the amount of these guarantees in the event the Company defaulted in performing the obligations under each contract, of which, the probability is remote.

The Company had a total of $1.9 million in letters of credit outstanding as of September 30, 2018 primarily in connection with insurance programs and our foreign subsidiaries.

Accumulated Other Comprehensive Income ("AOCI")	3 Months Ended
Accumulated Other Comprehensive Income ("AOCI")	Sep. 30, 2018
Equity [Abstract]
Accumulated Other Comprehensive Income (AOCI)	Accumulated Other Comprehensive Income ("AOCI")Comprehensive income is a measure of income that includes both net earnings and other comprehensive income (loss). Other comprehensive income (loss) results from items deferred on the condensed consolidated balance sheets in CDK stockholders' (deficit) equity. The Company's other comprehensive income (loss) for the three months ended September 30, 2018 and 2017 and AOCI balances as of September 30, 2018 and June 30, 2018 were comprised solely of currency translation adjustments. Other comprehensive income (loss) was $(6.0) million and $14.2 million for the three months ended September 30, 2018 and 2017, respectively. The accumulated balances reported in AOCI on the condensed consolidated balance sheets for currency translation adjustments were $5.1 million and $11.5 million as of September 30, 2018 and June 30, 2018, respectively.

Share Repurchase Transactions	3 Months Ended
Share Repurchase Transactions	Sep. 30, 2018
Equity [Abstract]
Share Repurchase Transactions	Share Repurchases In January 2017, the Board of Directors authorized the Company to repurchase up to $2.0 billion of our common stock as part of a return of capital plan. Under the authorization, the Company may purchase its common stock in the open market or in privately negotiated transactions from time to time as permitted by federal securities laws and other legal requirements. The actual timing, number, and price of any shares to be repurchased is determined at management's discretion and depends on a number of factors, including the market price of the shares, general market and economic conditions, and other potential uses for free cash flow including, but not limited to, potential acquisitions. The Company made open market repurchases of approximately 1.8 million shares of the Company's common stock during the three months ended September 30, 2018 for a total cost of $114.1 million.

Interim Financial Data by Segment

3 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Interim Financial Data by Segment

Financial Data by Segment

The Company is organized into two main operating groups. The Company's first operating group is CDK North America which is comprised of two reportable segments, Retail Solutions North America and Advertising North America. The second operating group, which is also a reportable segment, is CDK International.

The primary components of the Other segment are corporate allocations and other expenses not recorded in the segment results, such as stock-based compensation expense, corporate costs, interest expense, costs attributable to the business transformation plan, results of our captive insurance company and certain unallocated expenses. Certain expenses are charged to the reportable segments at a standard rate for management reasons. Other costs are recorded based on management responsibility.

In the first quarter of fiscal 2019, the Company revised segment reporting to reclassify the assets and liabilities and operating results of the April 2018 acquisition of Progressus Media LLC to the RSNA segment. The results were previously reported in the ANA segment.

Revenue by segment was as follows:



	Revenues
	Three Months Ended
	September 30,
	2018		2017
CDK North America:
Retail Solutions North America	$	410.1	$