Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Financial Statements

	Report of Independent Registered Public Accounting Firm	25
	Management's Annual Report on Internal Control over Financial Reporting (Revised)	26
	Report of Independent Registered Public Accounting Firm	27
	Financial Statements
	Consolidated Statements of Income,
	Years Ended June 30, 2014 (Restated), 2013 (Restated), and 2012 (Restated)	29
	Consolidated Balance Sheets,
	June 30, 2014 (Restated) and 2013 (Restated)	30
	Consolidated Statements of Changes in Stockholders' Equity,
	Years Ended June 30, 2014 (Restated), 2013 (Restated), and 2012 (Restated)	31
	Consolidated Statements of Cash Flows,
	Years Ended June 30, 2014 (Restated), 2013 (Restated), and 2012 (Restated)	32
	Notes to Consolidated Financial Statements	34

Financial Statement Schedules

There are no schedules included because they are not applicable or the required information is shown in the consolidated financial statements or notes thereto.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Jack Henry & Associates, Inc.

Monett, Missouri

We have audited the accompanying consolidated balance sheets of Jack Henry & Associates, Inc. and subsidiaries (the “Company”) as of June 30, 2014 and 2013, and the related consolidated statements of income, changes in stockholders’ equity, and cash flows for each of the three years in the period ended June 30, 2014. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Jack Henry & Associates, Inc. and subsidiaries as of June 30, 2014 and 2013, and the results of their operations and their cash flows for each of the three years in the period ended June 30, 2014, in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 15 to the consolidated financial statements, the accompanying 2014, 2013 and 2012 consolidated financial statements have been restated to correct an error.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company’s internal control over financial reporting as of June 30, 2014, based on the criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated August 26, 2014 (June 25, 2015 as to the effects of the material weakness described in Management’s Annual Report on Internal Control over Financial Reporting (Revised)) expressed an adverse opinion on the Company’s internal control over financial reporting because of a material weakness.

/s/ DELOITTE & TOUCHE LLP

Kansas City, Missouri

August 26, 2014 (June 25, 2015 as to the effects of the restatement discussed in Note 15)

MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING (Revised)

The management of Jack Henry & Associates, Inc. is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s consolidated financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America.

The Company’s internal control over financial reporting includes policies and procedures pertaining to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets; provide reasonable assurance transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and receipts and expenditures are being made only in accordance with authorizations of management and the directors of the Company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the Company’s consolidated financial statements. All internal controls, no matter how well designed, have inherent limitations. Therefore, even where internal control over financial reporting is determined to be effective, it can provide only reasonable assurance. Projections of any evaluation of effectiveness to future periods are subject to the risk controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

In connection with the Original Filing on August 27, 2014, management conducted an assessment of the effectiveness of the Company's internal control over financial reporting based on the framework established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the "COSO Framework"). Based on this assessment, management had determined the Company's internal control over financial reporting as of June 30, 2014 was effective.

In connection with the restatement discussed elsewhere in this 2014 Amended Annual Report on Form 10-K/A, management reevaluated the effectiveness of the Company's internal control over financial reporting as of June 30, 2014. As a result of the reevaluation and based on the criteria in the COSO Framework, management concluded, based upon the identification of a material weakness (the description of which is set forth below), that the Company did not maintain effective internal control over financial reporting as of June 30, 2014.

There are a number of deficiencies in the design and operating effectiveness of internal control over financial reporting that, in the aggregate, constitute a material weakness. The identified deficiencies noted below stem from a failure in the Company’s risk assessment process wherein the risk assessment process did not identify or evaluate the inherent risks and complexities associated with accounting for revenue arrangements with software elements.

•	The lack of training and continuing education related to multiple element software arrangements led to a lack of knowledge of the individuals tasked with understanding various technical accounting matters associated with the Company's multiple element arrangement revenue recognition policies.

•	Appropriate accounting and reporting policies and procedures related to bundled multiple element arrangements were not designed and implemented.

•	Appropriate internal controls over financial reporting for bundled multiple element arrangements were not designed and implemented.

•	Monitoring, including use of internal audit, was not appropriately designed to identify errors in accounting for revenue recognition for multiple element software arrangements.

These deficiencies in internal controls over financial reporting resulted in accounting errors in revenue recognition and delayed regulatory filings. See Note 15 - Restatement of Consolidated Financial Statements which is included in "Financial Statements and Supplementary Data" in Item 8 of this 2014 Amended Annual Report on Form 10-K/A for additional information.

The Company’s internal control over financial reporting as of June 30, 2014 has been audited by the Company’s independent registered public accounting firm, as stated in their report appearing on the next page.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Jack Henry & Associates, Inc.

Monett, Missouri

We have audited the internal control over financial reporting of Jack Henry & Associates Inc. and subsidiaries (the “Company”) as of June 30, 2014, based on criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting (Revised). Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our report dated August 26, 2014, we expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. As described in the following paragraph, a material weakness was subsequently identified as a result of the restatement of the previously issued financial statements. Accordingly, management has revised its assessment about the effectiveness of the Company’s internal control over financial reporting and our present opinion on the effectiveness of the Company’s internal control over financial reporting as of June 30, 2014, as expressed herein, is different from that expressed in our previous report.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management's assessment:

There are a number of deficiencies in the design and operating effectiveness of internal control over financial reporting that, in aggregate, constitute a material weakness. The identified deficiencies stem from a failure in the Company’s risk assessment process wherein the risk assessment process did not identify or evaluate the inherent risks and complexities associated with accounting for revenue arrangements with software elements. As a result of this failure, the following deficiencies were identified:

•	The lack of training and continuing education related to multiple element software arrangements led to a lack of competence with individuals tasked with understanding various technical accounting matters associated with the Company's multiple element arrangement revenue recognition policies.

•	Appropriate accounting and reporting policies and procedures related to bundled multiple element arrangements were not designed and implemented.

•	Appropriate internal control over financial reporting for bundled multiple element arrangements was not designed and implemented.

•	Monitoring, including use of internal audit, was not appropriately designed to identify errors in accounting for revenue recognition for multiple element software arrangements.

These deficiencies in internal control over financial reporting resulted in accounting errors in revenue recognition and delayed regulatory filings.

This material weakness was considered in determining the nature, timing, and extent of audit tests applied in our audit of the consolidated financial statements as of and for the year ended June 30, 2014, of the Company and this report does not affect our report on such financial statements.

In our opinion, because of the effect of the material weakness identified above on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of June 30, 2014, based on the criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements as of and for the year ended June 30, 2014 of the Company, and our report dated August 26, 2014 (June 25, 2015 as to the effects of the restatement discussed in Note 15 to the consolidated financial statements) expressed an unqualified opinion on those financial statements and included an explanatory paragraph regarding the restatement of the consolidated financial statements.

/s/ DELOITTE & TOUCHE LLP

Kansas City, Missouri

August 26, 2014 (June 25, 2015 as to the effects of the material weakness described in Management’s Annual Report on Internal Control over Financial Reporting (Revised))

JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Share Data)
	Year Ended
	June 30,
	2014 As Restated, See Note 15				2013 As Restated, See Note 15				2012 As Restated, See Note 15
REVENUE
License	$	2,184			$	5,366			$	5,652
Support and service	1,112,331				1,042,801				948,893
Hardware	58,658				59,357				63,122
Total revenue	1,173,173				1,107,524				1,017,667
COST OF SALES
Cost of license	908				860				2,291
Cost of support and service	634,756				601,620				550,570
Cost of hardware	43,708				43,650				45,983
Total cost of sales	679,372				646,130				598,844
GROSS PROFIT	493,801				461,394				418,823
OPERATING EXPENSES
Selling and marketing	85,443				80,811				76,236
Research and development	66,748				63,202				60,876
General and administrative	53,312				66,624				50,119
Total operating expenses	205,503				210,637				187,231
OPERATING INCOME	288,298				250,757				231,592
INTEREST INCOME (EXPENSE)
Interest income	377				640				1,176
Interest expense	(1,105		)		(6,337		)		(5,743		)
Total interest income (expense)	(728		)		(5,697		)		(4,567		)
INCOME BEFORE INCOME TAXES	287,570				245,060				227,025
PROVISION FOR INCOME TAXES	100,855				77,450				74,985
NET INCOME	$	186,715			$	167,610			$	152,040
Diluted earnings per share	$	2.19			$	1.94			$	1.74
Diluted weighted average shares outstanding	85,396				86,619				87,287
Basic earnings per share	$	2.20			$	1.95			$	1.76
Basic weighted average shares outstanding	84,866				86,040				86,599

See notes to consolidated financial statements

JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share and Per Share Data)
	2014 As Restated, See Note 15				2013 As Restated, See Note 15
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	70,377			$	127,905
Receivables, net	224,041				231,263
Income tax receivable	7,937				6,107
Prepaid expenses and other	61,074				60,843
Deferred costs	27,077				30,001
Total current assets	390,506				456,119
PROPERTY AND EQUIPMENT, net	291,675				300,511
OTHER ASSETS:
Non-current deferred costs	78,458				57,836
Computer software, net of amortization	160,391				132,612
Other non-current assets	44,657				35,470
Customer relationships, net of amortization	136,602				147,167
Other intangible assets, net of amortization	25,653				9,380
Goodwill	552,761				533,291
Total other assets	998,522				915,756
Total assets	$	1,680,703			$	1,672,386
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	10,516			$	11,701
Accrued expenses	63,299				68,528
Deferred income tax liability	30,094				22,366
Notes payable and current maturities of long term debt	5,407				7,929
Deferred revenues	337,493				323,678
Total current liabilities	446,809				434,202
LONG TERM LIABILITIES:
Non-current deferred revenues	155,375				115,918
Non-current deferred income tax liability	97,720				93,498
Debt, net of current maturities	3,729				7,366
Other long-term liabilities	9,683				5,586
Total long term liabilities	266,507				222,368
Total liabilities	713,316				656,570
STOCKHOLDERS' EQUITY
Preferred stock - $1 par value; 500,000 shares authorized, none issued	—				—
Common stock - $0.01 par value; 250,000,000 shares authorized; 102,429,926 shares issued at June 30, 2014; 101,993,808 shares issued at June 30, 2013	1,024				1,020
Additional paid-in capital	412,512				400,710
Retained earnings	1,131,632				1,016,168
Less treasury stock at cost 19,794,559 shares at June 30, 2014; 16,753,889 shares at June 30, 2013	(577,781		)		(402,082		)
Total stockholders' equity	967,387				1,015,816
Total liabilities and equity	$	1,680,703			$	1,672,386

See notes to consolidated financial statements

JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(In Thousands, Except Share and Per Share Data)
	Year Ended June 30,
	2014 As Restated, See Note 15				2013 As Restated, See Note 15				2012 As Restated, See Note 15
PREFERRED SHARES:	—				—				—
COMMON SHARES:
Shares, beginning of year	101,993,808				101,482,461				100,766,173
Shares issued for equity-based payment arrangements	344,372				405,270				594,428
Shares issued for Employee Stock Purchase Plan	91,746				106,077				121,860
Shares, end of year	102,429,926				101,993,808				101,482,461
COMMON STOCK - PAR VALUE $0.01 PER SHARE:
Balance, beginning of year	$	1,020			$	1,015			$	1,008
Shares issued for equity-based payment arrangements	3				4				6
Shares issued for Employee Stock Purchase Plan	1				1				1
Balance, end of year	$	1,024			$	1,020			$	1,015
ADDITIONAL PAID-IN CAPITAL:
Balance, beginning of year	$	400,710			$	381,919			$	361,131
Shares issued upon exercise of stock options	606				6,771				10,998
Tax withholding related to share based compensation	(6,598		)		(3,926		)		(4,112		)
Shares issued for Employee Stock Purchase Plan	4,283				3,699				3,321
Tax benefits from share-based compensation	3,420				3,632				3,631
Stock-based compensation expense	10,091				8,615				6,950
Balance, end of year	$	412,512			$	400,710			$	381,919
RETAINED EARNINGS:
Balance, beginning of year	$	1,016,168			$	896,760			$	782,848
Net income	186,715				167,610				152,040
Dividends	(71,251		)		(48,202		)		(38,128		)
Balance, end of year	$	1,131,632			$	1,016,168			$	896,760
TREASURY STOCK:
Balance, beginning of year	$	(402,082	)		$	(343,956	)		$	(309,585	)
Purchase of treasury shares	(175,699		)		(58,126		)		(34,371		)
Balance, end of year	$	(577,781	)		$	(402,082	)		$	(343,956	)
TOTAL STOCKHOLDERS' EQUITY	$	967,387			$	1,015,816			$	935,738

See notes to consolidated financial statements.

JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
	Year Ended
	June 30,
	2014 As Restated, See Note 15				2013 As Restated, See Note 15				2012 As Restated, See Note 15
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	186,715			$	167,610			$	152,040
Adjustments to reconcile net income from operations to net cash from operating activities:
Depreciation	52,935				51,967				45,322
Amortization	54,836				48,374				49,297
Change in deferred income taxes	12,752				18,336				20,911
Excess tax benefits from stock-based compensation	(3,406		)		(3,621		)		(3,465		)
Expense for stock-based compensation	10,091				8,615				6,950
(Gain)/loss on disposal of assets	(784		)		3,908				1,198
Changes in operating assets and liabilities:
Change in receivables	7,498				(12,739		)		(10,795		)
Change in prepaid expenses, deferred costs and other	(28,565		)		(11,502		)		(27,761		)
Change in accounts payable	(1,252		)		(4,582		)		3,488
Change in accrued expenses	(6,364		)		7,774				7,770
Change in income taxes	5,251				4,575				9,257
Change in deferred revenues	51,952				30,459				10,338
Net cash from operating activities	341,659				309,174				264,550
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for acquisitions, net of cash acquired	(27,894		)		—				—
Capital expenditures	(33,185		)		(46,256		)		(41,441		)
Proceeds from sale of assets	7,781				530				2,772
Customer contracts acquired	—				(186		)		(720		)
Internal use software	(16,288		)		—				—
Computer software developed	(62,194		)		(51,332		)		(37,873		)
Proceeds from investments	—				—				3,000
Purchase of investments	—				—				(2,000		)
Net cash from investing activities	(131,780		)		(97,244		)		(76,262		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facilities	25,000				—				—
Repayments on credit facilities	(47,158		)		(145,180		)		(35,280		)
Purchase of treasury stock	(175,699		)		(58,126		)		(34,371		)
Dividends paid	(71,251		)		(48,202		)		(38,128		)
Excess tax benefits from stock-based compensation	3,406				3,621				3,465
Proceeds from issuance of common stock upon exercise of stock options	609				6,775				11,004
Minimum tax withholding payments related to share based compensation	(6,598		)		(3,926		)		(4,112		)
Proceeds from sale of common stock, net	4,284				3,700				3,322
Net cash from financing activities	(267,407		)		(241,338		)		(94,100		)
NET CHANGE IN CASH AND CASH EQUIVALENTS	$	(57,528	)		$	(29,408	)		$	94,188
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	$	127,905			$	157,313			$	63,125
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	70,377			$	127,905			$	157,313

See notes to consolidated financial statements

JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, Except Per Share Amounts)

NOTE 1.	NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Restated)

DESCRIPTION OF THE COMPANY

Jack Henry & Associates, Inc. and subsidiaries (“JHA” or the “Company”) is a provider of integrated computer systems and services that has developed and acquired a number of banking and credit union software systems. The Company's revenues are predominately earned by marketing those systems to financial institutions nationwide together with computer equipment (hardware), by providing the conversion and software implementation services for financial institutions to utilize JHA software systems, and by providing other related services. JHA also provides continuing support and services to customers using in-house or outsourced systems.

CONSOLIDATION

The consolidated financial statements include the accounts of JHA and all of its subsidiaries, which are wholly-owned, and all intercompany accounts and transactions have been eliminated.

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

REVENUE RECOGNITION

The Company derives revenue from the following sources: license arrangements, support and service fees (non-software) and hardware sales. There are no rights of return, condition of acceptance or price protection in the Company’s sales contracts.

License Arrangements: For software license agreements, the Company recognizes revenue when persuasive evidence of an arrangement exists, delivery of the product or service has occurred, the fee is fixed and determinable and collection is probable. For arrangements where the fee is not fixed or determinable, revenue is deferred until payments become due. The Company’s software license agreements generally include multiple products and services or “elements.” Generally, none of these elements are deemed to be essential to the functionality of the other elements.

For multiple element arrangements, which contain software elements and non-software elements, we allocate revenue to the software deliverables and the non-software deliverables as a group based on the relative selling prices of all of the deliverables in the arrangement. For our non-software deliverables, we allocate the arrangement consideration based on the relative selling price of the deliverables using estimated selling price ("ESP"). For our software elements, we use VSOE for this allocation when it can be established and ESP when VSOE cannot be established.

The selling price for each element is based upon the following selling price hierarchy: VSOE if available, third party evidence ("TPE") if VSOE is not available, or ESP if neither VSOE or TPE are available. Generally, we are not able to determine TPE because our go-to-market strategy differs from that of our peers and our offerings contain a significant level of differentiation such that the comparable pricing of products with similar functionality cannot be obtained. ESP is determined after considering both market conditions (such as the sale of similar products in the market place) and entity-specific factors (such as pricing practices and the specifics of each transaction).

For our non-software deliverables, a delivered item is accounted for as a separate unit of accounting if the delivered item has standalone value and if the customer has a general right of return relative to the delivered item, delivery or performance of the undelivered item is probable and substantially within the vendor’s control.

For our software licenses and related services, including the software elements of multiple-element software and non-software arrangements, U.S. GAAP generally require revenue earned on software arrangements involving multiple elements to be allocated to each element based on vendor-specific objective evidence (“VSOE”) of fair value. VSOE of fair value is determined for implementation services based on a rate per hour for stand-alone professional services and the estimated hours for the bundled implementation, if the hours can be reasonably estimated. VSOE of fair value is determined for post-contract support ("PCS") based upon the price charged when sold separately. For a majority of the elements within our software arrangements, we have determined that VSOE cannot be established; therefore, revenue on our software arrangements is generally deferred until the only remaining element is post-contract support ("PCS"). At that point, the entire arrangement fee is recognized ratably over the remaining PCS period, assuming that

all other criteria for revenue recognition have been met. The amounts deferred are included in the balance sheet as deferred revenue and recognized to Bundled Products & Services revenue within Support & Service revenue in the income statement.

For arrangements that include specified upgrades, such upgrades are accounted for as a separate element of the arrangement. For those specified upgrades for which VSOE of fair value cannot be determined, revenue related to the software elements within the arrangement is deferred until such specified upgrades have been delivered.

Total revenue recognized ratably related to our Bundled Products & Services was $60,685, $64,275 and $73,942 for the years ended June 30, 2014, 2013, and 2012, respectively.

Support and Service Fee Revenue (Non-software): Maintenance support revenue contracted for outside of a license arrangement is recognized pro-rata over the contract period, typically one year.

Outsourced data processing and ATM, debit card, and other transaction processing services revenue is recognized in the month the transactions are processed or the services are rendered.

Hardware Revenue: Hardware revenue is recognized upon delivery to the customer, when title and risk of loss are transferred. In most cases, we do not stock in inventory the hardware products we sell, but arrange for third-party suppliers to drop-ship the products to our customers on our behalf. The Company also remarkets maintenance contracts on hardware to our customers. Hardware maintenance revenue is recognized ratably over the agreement period.

Revenue-based taxes collected from customers and remitted to governmental authorities are presented on a net basis (i.e. excluded from revenues).

DEFERRED COSTS

Costs for certain software and hardware maintenance contracts with third parties, which are prepaid, are recognized ratably over the life of the maintenance contract, generally one to five years, with the related revenue amortized from deferred revenues.

Direct and incremental costs associated with arrangements subject to Accounting Standards Codification ("ASC") 985-605 (for which VSOE of fair value cannot be established) are deferred until the only remaining element in the revenue arrangement is PCS at which point the costs are recognized ratably over the remaining PCS period with the related revenue. Direct and incremental costs associated with arrangements not subject to ASC 985-605 consist primarily of certain up-front costs incurred in connection with our software hosting arrangements and are recognized ratably over the contract period which typically ranges from 5-7 years. These costs include commissions, costs of third-party licenses and the direct costs of our implementation services, consisting of payroll and other fringe benefits.

DEFERRED REVENUES

Deferred revenues consist primarily of prepaid annual software support fees, deferred bundled software arrangements revenue, and prepaid hardware maintenance fees. Deferred bundled software arrangements revenue and hardware maintenance contracts may be recognized over multiple years; therefore, the related deferred revenue and maintenance are classified in accordance with the terms of the contract. Software and hardware deposits received are also reflected as deferred revenues.

The vast majority of our maintenance (PCS) renews annually and runs from July 1 to June 30. Renewal billings are submitted to customers each June and the Company has the right to bill at that date; therefore we include those billings as gross in deferred revenue and as a receivable on our balance sheet at the end of each fiscal year.

COMPUTER SOFTWARE DEVELOPMENT

The Company capitalizes new product development costs incurred from the point at which technological feasibility has been established through the point at which the product is ready for general availability. Software development costs that are capitalized are evaluated on a product-by-product basis annually and are assigned an estimated economic life based on the type of product, market characteristics, and maturity of the market for that particular product. These costs are amortized based on current and estimated future revenue from the product or on a straight-line basis, whichever yields greater amortization expense. All of this amortization expense is included within Cost of support and service.

CASH EQUIVALENTS

The Company considers all highly liquid investments with maturities of three months or less at the time of acquisition to be cash equivalents.

PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS

Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets.

Intangible assets consist of goodwill, customer relationships, computer software, and trade names acquired in business acquisitions in addition to internally developed computer software. The amounts are amortized, with the exception of those with an indefinite life (such as goodwill), over an estimated economic benefit period, generally five to twenty years.

The Company reviews its long-lived assets and identifiable intangible assets with finite lives for impairment whenever events or changes in circumstances have indicated that the carrying amount of its assets might not be recoverable. The Company evaluates goodwill and other indefinite-lived intangible assets for impairment of value on an annual basis as of January 1 and between annual tests if events or changes in circumstances indicate that the asset might be impaired.

COMPREHENSIVE INCOME

Comprehensive income for each of the years ended June 30, 2014, 2013, and 2012 equals the Company’s net income.

REPORTABLE SEGMENT INFORMATION

In accordance with U.S. GAAP, the Company's operations are classified as two reportable segments: bank systems and services and credit union systems and services (see Note 13). Revenue by type of product and service is presented on the face of the consolidated statements of income. Substantially all the Company’s revenues are derived from operations and assets located within the United States of America.

COMMON STOCK

The Board of Directors has authorized the Company to repurchase shares of its common stock. Under this authorization, the Company may finance its share repurchases with available cash reserves or short-term borrowings on its existing credit facilities. The share repurchase program does not include specific price targets or timetables and may be suspended at any time. At June 30, 2014, there were 19,795 shares in treasury stock and the Company had the remaining authority to repurchase up to 5,196 additional shares. The total cost of treasury shares at June 30, 2014 is $577,781. During fiscal 2014, the Company repurchased 3,041 treasury shares for $175,699. At June 30, 2013, there were 16,754 shares in treasury stock and the Company had authority to repurchase up to 8,237 additional shares.

Dividends declared per share were $0.84, $0.56, and $0.44 for the years ended June 30, 2014, 2013, and 2012, respectively.

EARNINGS PER SHARE

Per share information is based on the weighted average number of common shares outstanding during the year. Stock options have been included in the calculation of income per diluted share to the extent they are dilutive. The difference between basic and diluted weighted average shares outstanding is the dilutive effect of outstanding stock options (see Note 10).

INCOME TAXES

Deferred tax liabilities and assets are recognized for the tax effects of differences between the financial statement and tax bases of assets and liabilities. A valuation allowance would be established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized.

The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based upon the technical merits of the position. The tax benefits recognized in the financial statements from such a position is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Also, interest and penalties expense are recognized on the full amount of deferred benefits for uncertain tax positions. Our policy is to include interest and penalties related to unrecognized tax benefits in income tax expense.

RECENT ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers in May 2014. The new standard will supersede much of the existing authoritative literature for revenue recognition. The standard and related amendments will be effective for the Company for its annual reporting period beginning July 1, 2017, including interim periods within that reporting period. Early application is not permitted. Entities are allowed to transition to the new standard by either recasting prior periods or

recognizing the cumulative effect. The Company is currently evaluating the newly issued guidance, including which transition approach will be applied and the estimated impact it will have on our consolidated financial statements.

NOTE 2. FAIR VALUE OF FINANCIAL INSTRUMENTS

For cash equivalents, amounts receivable or payable and short-term borrowings, fair values approximate carrying value, based on the short-term nature of the assets and liabilities. The fair value of long term debt also approximates carrying value as estimated using discounted cash flows based on the Company’s current incremental borrowing rates or quoted prices in active markets.

The Company's estimates of the fair value for financial assets and financial liabilities are based on the framework established in the fair value accounting guidance. The framework is based on the inputs used in valuation, gives the highest priority to quoted prices in active markets, and requires that observable inputs be used in the valuations when available. The three levels of the hierarchy are as follows:

Level 1: inputs to the valuation are quoted prices in an active market for identical assets

Level 2: inputs to the valuation include quoted prices for similar assets in active markets that are observable either directly or indirectly

Level 3: valuation is based on significant inputs that are unobservable in the market and the Company's own estimates of assumptions that we believe market participants would use in pricing the asset

Fair value of financial assets, included in cash and cash equivalents, is as follows:

		Estimated Fair Value Measurements												Total Fair
		Level 1				Level 2				Level 3				Value
June 30, 2014
Financial Assets:
Money market funds		$	28,877			$	—			$	—			$	28,877
June 30, 2013
Financial Assets:
Money market funds		$	101,576			$	—			$	—			$	101,576

NOTE 3. PROPERTY AND EQUIPMENT

The classification of property and equipment, together with their estimated useful lives is as follows:

	June 30,
	2014				2013				Estimated Useful Life
Land	$	24,987			$	25,003
Land improvements	25,411				25,385				5 - 20 years
Buildings	143,733				142,350				20 - 30 years
Leasehold improvements	28,962				24,037				5 - 20 years	(1)
Equipment and furniture	316,064				293,044				3 - 10 years
Aircraft and equipment	27,246				45,179				5 - 15 years
Construction in progress	12,199				18,099
	578,602				573,097
Less accumulated depreciation	286,927				272,586
Property and equipment, net	$	291,675			$	300,511

(1) Lesser of lease term or estimated useful life

Property and equipment included $523 and $2,179 that was in accrued liabilities at June 30, 2014 and 2013, respectively. Also, the Company acquired $16,119 and $29,131 of computer equipment through capital leases for the years ended June 30, 2014 and 2013, respectively. These amounts were excluded from capital expenditures on the statement of cash flows.

NOTE 4. OTHER ASSETS

Goodwill

The carrying amount of goodwill for the years ended June 30, 2014 and 2013, by reportable segments, is as follows:

	June 30,
Banking	2014				2013
Beginning balance	$	403,720			$	403,949
Goodwill, acquired during the year	19,470				—
Goodwill, written off related to sale	—				(229		)
Ending balance	$	423,190			$	403,720
Credit Union
Beginning balance	$	129,571			$	129,571
Goodwill, acquired during the year	—				—
Ending balance	$	129,571			$	129,571

Other Intangible Assets

Information regarding other identifiable intangible assets is as follows:

	June 30,
	2014				2013
Customer relationships	$	276,337			$	272,391
Less accumulated amortization	(139,735		)		(125,224		)
Customer relationships, net	$	136,602			$	147,167
Other intangible assets	$	29,660			$	10,735
Less accumulated amortization	(4,007		)		(1,355		)
Other intangible assets, net	$	25,653			$	9,380
Computer software	$	345,248			$	288,095
Less accumulated amortization	(184,857		)		(155,483		)
Computer software, net	$	160,391			$	132,612

Customer relationships have lives ranging from 5 to 20 years. Our other intangible assets have useful lives ranging from 3 to 20 years.

Computer software includes the unamortized cost of commercial software products developed or acquired by the Company, which are capitalized and amortized over useful lives ranging from 5 to 10 years. Amortization expense for computer software totaled $37,720, $33,145, and $32,807 for the fiscal years ended June 30, 2014, 2013, and 2012, respectively. There were no material impairments in any of the fiscal years presented.

Amortization expense for all intangible assets was $54,836, $48,374, and $49,297 for the fiscal years ended June 30, 2014, 2013, and 2012, respectively. The estimated aggregate future amortization expense for each of the next five years for all intangible assets remaining as of June 30, 2014, is as follows:

Years Ending June 30,	Computer Software				Customer Relationships				Other Intangible Assets				Total
2015	$	39,051			$	14,398			$	4,493			$	57,942
2016	31,820				13,814				4,267				49,901
2017	23,006				13,585				2,761				39,352
2018	15,496				13,050				894				29,440
2019	7,151				12,829				697				20,677

NOTE 5. DEBT

The Company’s outstanding long and short term debt is as follows:

	June 30,				June 30,
	2014				2013
LONG TERM DEBT
Capital leases	$	7,757			$	14,161
Other borrowings	—				120
	7,757				14,281
Less current maturities	4,028				6,915
Debt, net of current maturities	$	3,729			$	7,366

SHORT TERM DEBT
Capital leases	$	1,379			$	1,014
Current maturities of long-term debt	4,028				6,915
Notes payable and current maturities of long term debt	$	5,407			$	7,929

The following table summarizes the annual principal payments required as of June 30, 2014:

Years ended June 30,
2015	$	5,407
2016	3,729
2017	—
2018	—
2019	—
Thereafter	—
	$	9,136

Capital leases

The Company has entered into various capital lease obligations for the use of certain computer equipment. Long term capital lease obligations were entered into of which $7,757 remains outstanding at June 30, 2014 and $4,028 will be maturing within the next twelve months. The Company also has short term capital lease obligations totaling $1,379 at June 30, 2014. Included in property and equipment are assets under capital leases totaling $37,316, which have accumulated depreciation totaling $7,994.

Other lines of credit

The long term revolving credit facility allows for borrowings of up to $150,000, which may be increased by the Company at any time until maturity to $250,000. The credit facility bears interest at a variable rate equal to (a) a rate based on LIBOR or (b) an alternate base rate (the greater of (a) the Federal Funds Rate plus 0.5%, (b) the Prime Rate or (c) LIBOR plus 1.0%), plus an applicable percentage in each case determined by the Company's leverage ratio. The credit facility is secured by pledges of capital stock of certain subsidiaries of the Company and also guaranteed by certain subsidiaries of the Company. The credit facility is subject to various financial covenants that require the Company to maintain certain financial ratios as defined in the agreement. As of June 30, 2014, the Company was in compliance with all such covenants. The revolving loan terminates June 4, 2015 and at June 30, 2014, there was no outstanding revolving loan balance.

The Company renewed an unsecured bank credit line on March 3, 2014 which provides for funding of up to $5,000 and bears interest at the prime rate less 1%. The credit line was renewed through April 30, 2017. At June 30, 2014, no amount was outstanding.

Interest

The Company paid interest of $620, $3,549, and $3,899 in 2014, 2013, and 2012 respectively.

NOTE 6. COMMITMENTS AND CONTINGENCIES

Litigation

We are subject to various routine legal proceedings and claims, including the following:

In May 2013 a patent infringement lawsuit entitled DataTreasury Corporation v. Jack Henry & Associates, Inc. et. al. was filed against the Company, several subsidiaries and a number of customer financial institutions in the US District Court for the Eastern District of Texas. The complaint seeks damages, interest, injunctive relief, and attorneys' fees for the alleged infringement of two patents, as well as trebling of damage awards for alleged willful infringement. We believe we have strong defenses and intend to defend the lawsuit vigorously. At this stage, we cannot make a reasonable estimate of possible loss or range of loss, if any, arising from this lawsuit.

Property and Equipment

The Company had $14,293 of material commitments at June 30, 2014 to purchase property and equipment related mainly to the purchase of aircraft. There were $18,779 material commitments at June 30, 2013.

Leases

The Company leases certain property under operating leases which expire over the next 7 years, but certain of the leases contain options to extend the lease term. All lease payments are based on the lapse of time but include, in some cases, payments for operating expenses and property taxes. There are no purchase options on real estate leases at this time. Certain leases on real estate are subject to annual escalations for increases in operating expenses and property taxes.

As of June 30, 2014, net future minimum lease payments are as follows:

Years Ending June 30,	Lease Payments
2015	$	7,851
2016	7,587
2017	6,437
2018	5,016
2019	2,453
Thereafter	1,803
Total	$	31,147

Rent expense was $8,609, $8,124, and $8,410 in 2014, 2013, and 2012 respectively.

NOTE 7. INCOME TAXES

The provision for income taxes from continuing operations consists of the following:

	Year Ended June 30,
	2014				2013				2012
Current:
Federal	$	77,937			$	54,574			$	48,053
State	10,166				4,540				6,021
Deferred:
Federal	10,636				14,689				19,063
State	2,116				3,647				1,848
	$	100,855			$	77,450			$	74,985

The tax effects of temporary differences related to deferred taxes shown on the balance sheets were:

	June 30,
	2014				2013
Deferred tax assets:
Deferred revenue	$	71,383			$	57,867
Expense reserves (bad debts, insurance, franchise tax and vacation)	14,776				12,515
Net operating loss carryforwards	4,218				6,363
Other, net	1,122				1,383
	91,499				78,128
Deferred tax liabilities:
Accelerated tax depreciation	(29,247		)		(35,046		)
Accelerated tax amortization	(125,054		)		(106,147		)
Prepaid expenses	(50,955		)		(42,385		)
Other, net	(13,357		)		(9,714		)
	(218,613		)		(193,292		)
Net deferred tax liability before valuation allowance	(127,114		)		(115,164		)
Valuation allowance	(700		)		(700		)
Net deferred tax liability	$	(127,814	)		$	(115,864	)

The deferred taxes are classified on the balance sheets as follows:

	2014				2013
Deferred income taxes (current)	$	(30,094	)		$	(22,366	)
Deferred income taxes (long-term)	(97,720		)		(93,498		)
	$	(127,814	)		$	(115,864	)

The following analysis reconciles the statutory federal income tax rate to the effective income tax rates reflected above:

	Year Ended June 30,
	2014			2013			2012
Computed "expected" tax expense	35.0	%		35.0	%		35.0	%
Increase (reduction) in taxes resulting from:
State income taxes, net of federal income tax benefits	2.8	%		2.2	%		2.2	%
Research and development credit	(0.8	)%		(3.5	)%		(1.8	)%
Domestic production activities deduction	(2.2	)%		(2.3	)%		(2.2	)%
Other (net)	0.3	%		0.2	%		(0.2	)%
	35.1	%		31.6	%		33.0	%

As of June 30, 2014, we have $8,761 of net operating loss (“NOL”) carryforwards pertaining to the acquisition of Goldleaf Financial Solutions, Inc., which are expected to be utilized after the application of IRC Section 382. Separately, as of June 30, 2014, we had state NOL carryforwards of $1,705. The federal and state losses have varying expiration dates, ranging from 2014 to 2034. Based on state tax rules which restrict our utilization of these losses, we believe it is more likely than not that $700 of these losses will expire unutilized. Accordingly, a valuation allowance of $700 and $700 has been recorded against these assets as of June 30, 2014 and 2013, respectively.

The Company paid income taxes of $83,014, $54,815, and $44,962 in 2014, 2013, and 2012 respectively.

At June 30, 2013, the Company had $4,890 of unrecognized tax benefits. At June 30, 2014, the Company had $7,834 of gross unrecognized tax benefits, $5,366 of which, if recognized, would affect our effective tax rate. We had accrued interest and penalties of $1,315 and $597 related to uncertain tax positions at June 30, 2014 and 2013, respectively.

A reconciliation of the unrecognized tax benefits for the years ended June 30, 2014 and 2013 follows:

	Unrecognized Tax Benefits
Balance at July 1, 2012	$	6,202
Additions for current year tax positions	1,087
Reductions for current year tax positions	—
Additions for prior year tax positions	510
Reductions for prior year tax positions	(2,720		)
Settlements	—
Reductions related to expirations of statute of limitations	(189		)
Balance at June 30, 2013	4,890
Additions for current year tax positions	1,380
Reductions for current year tax positions	—
Additions for prior year tax positions	1,662
Reductions for prior year tax positions	(1		)
Settlements	—
Reductions related to expirations of statute of limitations	(97		)
Balance at June 30, 2014	$	7,834

The U.S. federal and state income tax returns for June 30, 2011 and all subsequent years remain subject to examination as of June 30, 2014 under statute of limitations rules. We anticipate potential changes could reduce the unrecognized tax benefits balance by $1,700 - $2,300 within twelve months of June 30, 2014.

NOTE 8. INDUSTRY AND SUPPLIER CONCENTRATIONS

The Company sells its products to banks, credit unions, and financial institutions throughout the United States and generally does not require collateral. All billings to customers are due 30 days from date of billing. Reserves (which are insignificant at June 30, 2014, 2013, and 2012) are maintained for potential credit losses.

In addition, the Company purchases most of its computer hardware and related maintenance for resale in relation to installation of JHA software systems from two suppliers. There are a limited number of hardware suppliers for these required items. If these relationships were terminated, it could have a negative impact on the operations of the Company.

NOTE 9. STOCK-BASED COMPENSATION

Our pre-tax operating income for the years ended June 30, 2014, 2013 and 2012 includes $10,091, $8,615 and $6,950 of equity-based compensation costs, respectively, of which $9,335, $7,962 and $6,364 relates to the restricted stock plan, respectively.

2005 NSOP and 1996 SOP

The Company previously issued options to employees under the 1996 Stock Option Plan (“1996 SOP”) and to outside directors under the 2005 Non-Qualified Stock Option Plan (“2005 NSOP”).

The 1996 SOP was adopted by the Company on October 29, 1996, for its employees. Terms and vesting periods of the options were determined by the Compensation Committee of the Board of Directors when granted and for options outstanding include vesting periods up to four years. Shares of common stock were reserved for issuance under this plan at the time of each grant, which must be at or above fair market value of the stock at the grant date. The options terminate 30 days after termination of employment, 3 months after retirement, one year after death or 10 years after the date of grant. The plan terminated by its terms on October 29, 2006, although options previously granted under the 1996 SOP are still outstanding and vested.

The 2005 NSOP was adopted by the Company on September 23, 2005, for its outside directors. Generally, options are exercisable beginning 6 months after grant at an exercise price equal to the fair market value of the stock at the grant date. For individuals who have served less than 4 continuous years, 25% of all options will vest after one year of service, 50% shall vest after two years, and 75% shall vest after three years of service on the Board. The options terminate upon surrender of the option, upon the expiration of 1 year following notification of a deceased optionee, or 10 years after grant. 700 shares of common stock have been reserved for issuance under this plan with a maximum of 100 for each director.

A summary of option plan activity under the plan is as follows:

	Number of Shares			Weighted Average Exercise Price				Aggregate Intrinsic Value
Outstanding July 1, 2011	990			$	15.65
Granted	—			—
Forfeited	—			—
Exercised	(526	)		15.17
Outstanding July 1, 2012	464			16.19
Granted	—			—
Forfeited	—			—
Exercised	(320	)		13.68
Outstanding July 1, 2013	144			21.79
Granted	—			—
Forfeited	—			—
Exercised	(19	)		18.42
Outstanding June 30, 2014	125			$	22.29			$	4,633
Vested June 30, 2014	125			$	22.29			$	4,633
Exercisable June 30, 2014	125			$	22.29			$	4,633

There were no options granted during any period presented. As of June 30, 2014, there was no unrecognized compensation costs related to stock options since all options have now vested. The weighted average remaining contractual term on options currently exercisable as of June 30, 2014 was 3.49 years.

The income tax benefits from stock option exercises totaled $3,420, $3,632 and $3,631 for the years ended June 30, 2014, 2013, and 2012, respectively.

The total intrinsic value of options exercised was $704, $8,254 and $9,654 for the fiscal years ended June 30, 2014, 2013, and 2012, respectively.

Restricted Stock Plan

The Restricted Stock Plan was adopted by the Company on November 1, 2005, for its employees. Up to 3,000 shares of common stock are available for issuance under the plan. Upon issuance, shares of restricted stock are subject to forfeiture and to restrictions which limit the sale or transfer of the shares during the restriction period. The restrictions will be lifted over periods ranging from 3 years to 7 years years from grant date. On certain awards, the restrictions may be lifted sooner if certain targets for shareholder return are met.

The following table summarizes non-vested share awards activity:

Share awards	Shares			Weighted Average Grant Date Fair Value
Outstanding July 1, 2011	416			$	22.34
Granted	42			31.50
Vested	(106	)		22.92
Forfeited	(20	)		25.49
Outstanding July 1, 2012	332			23.13
Granted	53			36.78
Vested	(125	)		23.17
Forfeited	(8	)		23.11
Outstanding July 1, 2013	252			25.92
Granted	30			54.13
Vested	(143	)		24.41
Forfeited	(1	)		22.17
Outstanding June 30, 2014	138			$	33.56

The non-vested share awards will not participate in dividends during the restriction period. As a result, the weighted-average fair value of the non-vested share awards is based on the fair market value of the Company’s equity shares on the grant date, less the present value of the expected future dividends to be declared during the restriction period.

At June 30, 2014, there was $1,492 of compensation expense that has yet to be recognized related to non-vested restricted stock share awards, which will be recognized over a weighted-average period of 0.92 years.

An amendment to the Restricted Stock Plan was adopted by the Company on August 20, 2010, for its executive officers. Unit awards will be made to employees remaining in continuous employment throughout the performance period and vary based on the Company’s percentile ranking in Total Shareholder Return (“TSR”) over the performance period compared to a peer group of companies. TSR is defined as the change in the stock price through the performance period plus dividends per share paid during the performance period, all divided by the stock price at the beginning of the performance period. It is the intention of the Company to settle the unit awards in shares of the Company’s stock.

The following table summarizes non-vested unit awards as of June 30, 2014, as well as activity for the year then ended:

Unit awards	Shares			Weighted Average Grant Date Fair Value
Outstanding July 1, 2011	293			$	15.77
Granted	391			19.69
Vested	—			—
Forfeited	(12	)		15.77
Outstanding July 1, 2012	672			18.05
Granted	174			42.39
Vested	—			—
Forfeited	(32	)		22.45
Outstanding July 1, 2013	814			23.08
Granted	164			48.21
Vested	(168	)		15.77
Forfeited	(101	)		15.77
Outstanding June 30, 2014	709			$	31.66

The weighted average assumptions used in this model to estimate fair value at the measurement date and resulting values are as follows:

	Year Ended June 30,
	2014			2013			2012
Volatility	21.6	%		23.3	%		34.2	%
Risk free interest rate	0.91	%		0.33	%		0.31	%
Dividend yield	1.6	%		1.2	%		1.5	%
Stock Beta	0.837			0.864			0.903

At June 30, 2014, there was $8,193 of compensation expense that has yet to be recognized related to non-vested restricted stock unit awards, which will be recognized over a weighted-average period of 0.91 years.

NOTE 10. EARNINGS PER SHARE

The following table reflects the reconciliation between basic and diluted earnings per share, as well as cash dividends paid per share:

	Year Ended June 30,
	2014				2013				2012
Net Income	$	186,715			$	167,610			$	152,040
Common share information:
Weighted average shares outstanding for basic earnings per share	84,866				86,040				86,599
Dilutive effect of stock options and restricted stock	530				579				688
Weighted average shares outstanding for diluted earnings per share	85,396				86,619				87,287
Basic earnings per share	$	2.20			$	1.95			$	1.76
Diluted earnings per share	$	2.19			$	1.94			$	1.74

Per share information is based on the weighted average number of common shares outstanding for each of the fiscal years. Stock options and restricted stock have been included in the calculation of earnings per share to the extent they are dilutive. There were 24 anti-dilutive stock options and restricted stock excluded from the computation of diluted earnings per share for fiscal 2014, with no shares excluded for fiscal 2013 and no shares excluded for fiscal 2012.

NOTE 11. EMPLOYEE BENEFIT PLANS

The Company established an employee stock purchase plan in 2006. The plan allows the majority of employees the opportunity to directly purchase shares of the Company at a 15% discount. The plan does not meet the criteria as a non-compensatory plan. As a result, the Company records the total dollar value of the stock discount given to employees under the plan as expense. Total expense recorded by the Company under the plan for the year ended June 30, 2014, 2013 and 2012 was $756, $653 and $586, respectively.

The Company has a defined contribution plan for its employees: the 401(k) Retirement Savings Plan (the “Plan”). The Plan is subject to the Employee Retirement Income Security Act of 1975 (“ERISA”) as amended. Under the Plan, the Company matches 100% of full time employee contributions up to 5% of compensation subject to a maximum of $5 per year. In order to receive matching contributions, employees must be 18 years of age and be employed for at least six months. The Company has the option of making a discretionary contribution; however, none has been made for any of the three most recent fiscal years. The total matching contributions for the Plan were $13,617, $12,426, and $11,376 for fiscal 2014, 2013 and 2012, respectively.

NOTE 12. BUSINESS ACQUISITION

Banno, LLC

Effective March 1, 2014, the Company acquired all of the equity interests of Banno, an Iowa-based company that provides Web and transaction marketing services with a focus on the mobile medium, for $27,910 paid in cash. This acquisition was funded using existing operating cash. The acquisition of Banno expanded the Company’s presence in online and mobile technologies within the industry.

Management has completed a preliminary purchase price allocation of Banno and its assessment of the fair value of acquired assets and liabilities assumed. The recognized amounts of identifiable assets acquired and liabilities assumed, based upon their preliminary fair values as of March 1, 2014 are set forth below:

Current assets	$	610
Long-term assets	87
Identifiable intangible assets	9,255
Total liabilities assumed	(1,512		)
Total identifiable net assets	8,440
Goodwill	19,470
Net assets acquired	27,910

The amounts shown above may change in the near term as management continues to assess the fair value of acquired assets and liabilities and evaluate the income tax implications of this business combination.

The goodwill of $19,470 arising from this acquisition consists largely of the growth potential, synergies and economies of scale expected from combining the operations of the Company with those of Banno, together with the value of Banno’s assembled workforce. Goodwill from this acquisition has been allocated to our Banking Systems and Services segment. Approximately 95% of the goodwill is expected to be deductible for income tax purposes.

Identifiable intangible assets from this acquisition consists of customer relationships of $3,946, $3,546 of computer software and other intangible assets of $1,763. The weighted average amortization period for acquired customer relationships, acquired computer software, and other intangible assets is 15 years, 8 years, and 20 years, respectively.

Current assets is inclusive of cash acquired of $16. The fair value of current assets acquired included accounts receivable of $476. The gross amount receivable is $501, of which $25 is expected to be uncollectible.

During fiscal year 2014, the Company incurred $30 in costs related to the acquisition of Banno. These costs included fees for legal, valuation and other fees. These costs were included within general and administrative expenses.

The results of Banno’s operations included in the Company’s consolidated statement of operations from the acquisition date to June 30, 2014 included revenue of $848 and after-tax net loss of $1,121.

The accompanying consolidated statements of income for the three and twelve month periods ended June 30, 2014 do not include any revenues and expenses related to this acquisition prior to the acquisition date. The impact of this acquisition was considered immaterial to our both the current and prior periods of our consolidated financial statements and pro forma financial information has not been provided.

NOTE 13. REPORTABLE SEGMENT INFORMATION

The Company is a provider of integrated computer systems that perform data processing (available for in-house installations or outsourced services) for banks and credit unions. The Company’s operations are classified into two reportable segments: bank systems and services (“Bank”) and credit union systems and services (“Credit Union”). The Company evaluates the performance of its segments and allocates resources to them based on various factors, including prospects for growth, return on investment, and return on revenue.

	Year Ended
	June 30, 2014
	Bank				Credit Union				Total
REVENUE
License	$	1,514			$	670			$	2,184
Support and service	853,500				258,831				1,112,331
Hardware	42,657				16,001				58,658
Total revenue	897,671				275,502				1,173,173
COST OF SALES
Cost of license	555				353				908
Cost of support and service	492,777				141,979				634,756
Cost of hardware	31,866				11,842				43,708
Total cost of sales	525,198				154,174				679,372
GROSS PROFIT	$	372,473			$	121,328			493,801
OPERATING EXPENSES									205,503
INTEREST INCOME (EXPENSE)									(728		)
INCOME BEFORE INCOME TAXES									$	287,570

	Year Ended
	June 30, 2013
	Bank				Credit Union				Total
REVENUE
License	$	4,895			$	471			$	5,366
Support and service	794,433				248,368				1,042,801
Hardware	41,052				18,305				59,357
Total revenue	840,380				267,144				1,107,524
COST OF SALES
Cost of license	765				95				860
Cost of support and service	461,370				140,250				601,620
Cost of hardware	29,936				13,714				43,650
Total cost of sales	492,071				154,059				646,130
GROSS PROFIT	$	348,309			$	113,085			461,394
OPERATING EXPENSES									210,637
INTEREST INCOME (EXPENSE)									(5,697		)
INCOME BEFORE INCOME TAXES									$	245,060

	Year Ended
	June 30, 2012
	Bank				Credit Union				Total
REVENUE
License	$	4,984			$	668			$	5,652
Support and service	729,779				219,114				948,893
Hardware	45,051				18,071				63,122
Total revenue	779,814				237,853				1,017,667
COST OF SALES
Cost of license	1,938				353				2,291
Cost of support and service	422,672				127,898				550,570
Cost of hardware	32,123				13,860				45,983
Total cost of sales	456,733				142,111				598,844
GROSS PROFIT	$	323,081			$	95,742			418,823
OPERATING EXPENSES									187,231
INTEREST INCOME (EXPENSE)									(4,567		)
INCOME BEFORE INCOME TAXES									$	227,025

	Year Ended June 30,
	2014				2013				2012
Depreciation expense, net
Bank systems and services	$	48,382			$	47,789			$	41,053
Credit Unions systems and services	4,553				4,178				4,269
Total	$	52,935			$	51,967			$	45,322
Amortization expense, net
Bank systems and services	$	39,152			$	32,959			$	35,492
Credit Unions systems and services	15,684				15,415				13,805
Total	$	54,836			$	48,374			$	49,297
Capital expenditures
Bank systems and services	$	32,736			$	44,976			$	34,963
Credit Unions systems and services	449				1,280				6,478
Total	$	33,185			$	46,256			$	41,441

	June 30,				June 30,
	2014				2013
Property and equipment, net
Bank systems and services	$	258,437			$	265,595
Credit Union systems and services	33,238				34,916
Total	$	291,675			$	300,511
Intangible assets, net
Bank systems and services	$	643,972			$	589,891
Credit Union systems and services	231,435				232,559
Total	$	875,407			$	822,450

The Company has not disclosed any additional asset information by segment, as the information is not produced internally and its preparation is impracticable.

NOTE 14. SUBSEQUENT EVENTS

On August 22, 2014, the Company's Board of Directors declared a cash dividend of $0.22 per share on its common stock, payable on September 26, 2014 to shareholders of record on September 5, 2014.

NOTE 15. RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS

Correction of Accounting Errors

Subsequent to the filing of the Annual Report on Form 10-K for the fiscal year ended June 30, 2014 on August 27, 2014, management identified historical accounting errors relating to its accounting for certain software license, maintenance and service agreements. The prior period errors primarily relate to the Company's accounting for its bundled software multi-element arrangements.

More specifically, the Company concluded it had improperly accounted for contracts containing multiple software products delivered at different points in time as separate arrangements within a contract versus as a single arrangement with multiple elements, resulting in revenue being recognized on these contracts before all licenses, for which no VSOE exists, had been delivered. Furthermore, the Company concluded that its mechanisms for tracking and estimating implementation hours was not capable of producing reliable estimates in support of its assertion of VSOE for its implementation services and that its pricing for stand-alone sales of post-contract support ("PCS") was not consistent enough to support its assertion of VSOE for PCS during the current and prior periods.

Our previous accounting resulted in revenue being recognized earlier than would be appropriate for bundled software multi-element arrangements where VSOE does not exist for any of the software elements. Our current conclusions result in the deferral of revenue on such arrangements until the only undelivered element is PCS. The total arrangement revenue is then recognized ratably over the remaining initial bundled PCS period provided all other revenue recognition criteria have been met. Direct and incremental costs, including direct labor and sales commissions, related to obtaining

and implementing these contracts have also been deferred until the only undelivered element is PCS and are recognized ratably over the remaining initial bundled PCS period.

Due to the above errors, including the related tax impact, net income for the fiscal years ended June 30, 2014, 2013 and 2012 was overstated by $14,421, $9,035, and $2,944 respectively. On the balance sheet, total assets as of June 30, 2014 and 2013 increased $56,411 and $43,231, respectively; total liabilities increased $127,185 and $99,584 respectively; and stockholders' equity decreased $70,774 and $56,353 respectively.

The adjustments related to the years prior to 2012 are reflected in the beginning retained earnings for 2012. The cumulative impact of these adjusting entries decreased retained earnings by $44,373, net of tax, at the beginning of 2012.

The following tables present the effects of the restatement on each line of the Company's previously issued consolidated financial statements as of June 30, 2014 and 2013 and for the fiscal years ended June 30, 2014, 2013 and 2012.

Consolidated Statements of Income:
(In Thousands, Except Per Share Data)
	Year Ended
	June 30, 2014
	As Previously Reported				Effect of Restatement				As Restated
REVENUE
License	$	53,009			$	(50,825	)		$	2,184
Support and service	1,098,386				13,945				1,112,331
Hardware	58,658				—				58,658
Total revenue	1,210,053				(36,880		)		1,173,173
COST OF SALES
Cost of license	4,273				(3,365		)		908
Cost of support and service	643,443				(8,687		)		634,756
Cost of hardware	43,708				—				43,708
Total cost of sales	691,424				(12,052		)		679,372
GROSS PROFIT	518,629				(24,828		)		493,801
OPERATING EXPENSES
Selling and marketing	86,570				(1,127		)		85,443
Research and development	66,748				—				66,748
General and administrative	53,312				—				53,312
Total operating expenses	206,630				(1,127		)		205,503
OPERATING INCOME	311,999				(23,701		)		288,298
INTEREST INCOME (EXPENSE)
Interest income	377				—				377
Interest expense	(1,105		)		—				(1,105		)
Total interest income (expense)	(728		)		—				(728		)
INCOME BEFORE INCOME TAXES	311,271				(23,701		)		287,570
PROVISION FOR INCOME TAXES	110,135				(9,280		)		100,855
NET INCOME	$	201,136			$	(14,421	)		$	186,715
Diluted earnings per share	$	2.36			$	(0.17	)		$	2.19
Diluted weighted average shares outstanding	85,396				85,396				85,396
Basic earnings per share	$	2.37			$	(0.17	)		$	2.20
Basic weighted average shares outstanding	84,866				84,866				84,866

	Year Ended
	June 30, 2013
	As Previously Reported				Effect of Restatement				As Restated
REVENUE
License	$	54,818			$	(49,452	)		$	5,366
Support and service	1,015,211				27,590				1,042,801
Hardware	59,357				—				59,357
Total revenue	1,129,386				(21,862		)		1,107,524
COST OF SALES
Cost of license	4,824				(3,964		)		860
Cost of support and service	603,920				(2,300		)		601,620
Cost of hardware	43,650				—				43,650
Total cost of sales	652,394				(6,264		)		646,130
GROSS PROFIT	476,992				(15,598		)		461,394
OPERATING EXPENSES
Selling and marketing	81,619				(808		)		80,811
Research and development	63,202				—				63,202
General and administrative	66,624				—				66,624
Total operating expenses	211,445				(808		)		210,637
OPERATING INCOME	265,547				(14,790		)		250,757
INTEREST INCOME (EXPENSE)
Interest income	640				—				640
Interest expense	(6,337		)		—				(6,337		)
Total interest income (expense)	(5,697		)		—				(5,697		)
INCOME BEFORE INCOME TAXES	259,850				(14,790		)		245,060
PROVISION FOR INCOME TAXES	83,205				(5,755		)		77,450
NET INCOME	$	176,645			$	(9,035	)		$	167,610
Diluted earnings per share	$	2.04			$	(0.10	)		$	1.94
Diluted weighted average shares outstanding	86,619				86,619				86,619
Basic earnings per share	$	2.05			$	(0.11	)		$	1.95
Basic weighted average shares outstanding	86,040				86,040				86,040

	Year Ended
	June 30, 2012
	As Previously Reported				Effect of Restatement				As Restated
REVENUE
License	$	54,811			$	(49,159	)		$	5,652
Support and service	909,176				39,717				948,893
Hardware	63,122				—				63,122
Total revenue	1,027,109				(9,442		)		1,017,667
COST OF SALES
Cost of license	6,111				(3,820		)		2,291
Cost of support and service	551,285				(715		)		550,570
Cost of hardware	45,983				—				45,983
Total cost of sales	603,379				(4,535		)		598,844
GROSS PROFIT	423,730				(4,907		)		418,823
OPERATING EXPENSES
Selling and marketing	76,500				(264		)		76,236
Research and development	60,876				—				60,876
General and administrative	50,119				—				50,119
Total operating expenses	187,495				(264		)		187,231
OPERATING INCOME	236,235				(4,643		)		231,592
INTEREST INCOME (EXPENSE)
Interest income	1,176				—				1,176
Interest expense	(5,743		)		—				(5,743		)
Total interest income (expense)	(4,567		)		—				(4,567		)
INCOME BEFORE INCOME TAXES	231,668				(4,643		)		227,025
PROVISION FOR INCOME TAXES	76,684				(1,699		)		74,985
NET INCOME	$	154,984			$	(2,944	)		$	152,040
Diluted earnings per share	$	1.78			$	(0.03	)		$	1.74
Diluted weighted average shares outstanding	87,287				87,287				87,287
Basic earnings per share	$	1.79			$	(0.03	)		$	1.76
Basic weighted average shares outstanding	86,599				86,599				86,599

Consolidated Balance Sheets:
(In Thousands, Except Share and Per Share Data)
	June 30, 2014
	As Previously Reported				Effect of Restatement				As Restated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	70,377			$	—			$	70,377
Receivables, net	224,041				—				224,041
Income tax receivable	7,937				—				7,937
Prepaid expenses and other	59,824				1,250				61,074
Deferred costs	22,202				4,875				27,077
Total current assets	384,381				6,125				390,506
PROPERTY AND EQUIPMENT, net	291,675				—				291,675
OTHER ASSETS:
Non-current deferred costs	34,708				43,750				78,458
Computer software, net of amortization	160,391				—				160,391
Other non-current assets	38,121				6,536				44,657
Customer relationships, net of amortization	136,602				—				136,602
Other intangible assets, net of amortization	25,653				—				25,653
Goodwill	552,761				—				552,761
Total other assets	948,236				50,286				998,522
Total assets	$	1,624,292			$	56,411			$	1,680,703
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	10,516			$	—			$	10,516
Accrued expenses	63,299				—				63,299
Deferred income tax liability	37,592				(7,498		)		30,094
Notes payable and current maturities of long term debt	5,407				—				5,407
Deferred revenues	312,002				25,491				337,493
Total current liabilities	428,816				17,993				446,809
LONG TERM LIABILITIES:
Non-current deferred revenues	8,985				146,390				155,375
Non-current deferred income tax liability	134,918				(37,198		)		97,720
Debt, net of current maturities	3,729				—				3,729
Other long-term liabilities	9,683				—				9,683
Total long term liabilities	157,315				109,192				266,507
Total liabilities	586,131				127,185				713,316
STOCKHOLDERS' EQUITY
Preferred stock - $1 par value; 500,000 shares authorized, none issued	—				—				—
Common stock - $0.01 par value; 250,000,000 shares authorized; 102,429,926 shares issued at June 30, 2014	1,024				—				1,024
Additional paid-in capital	412,512				—				412,512
Retained earnings	1,202,406				(70,774		)		1,131,632
Less treasury stock at cost 19,794,559 shares at June 30, 2014	(577,781		)		—				(577,781		)
Total stockholders' equity	1,038,161				(70,774		)		967,387
Total liabilities and equity	$	1,624,292			$	56,411			$	1,680,703

Consolidated Balance Sheets:
(In Thousands, Except Share and Per Share Data)
	June 30, 2013
	As Previously Reported				Effect of Restatement				As Restated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	127,905			$	—			$	127,905
Receivables, net	231,263				—				231,263
Income tax receivable	6,107				—				6,107
Prepaid expenses and other	59,244				1,599				60,843
Deferred costs	23,366				6,635				30,001
Total current assets	447,885				8,234				456,119
PROPERTY AND EQUIPMENT, net	300,511				—				300,511
OTHER ASSETS:
Non-current deferred costs	27,898				29,938				57,836
Computer software, net of amortization	132,612				—				132,612
Other non-current assets	30,411				5,059				35,470
Customer relationships, net of amortization	147,167				—				147,167
Other intangible assets, net of amortization	9,380				—				9,380
Goodwill	533,291				—				533,291
Total other assets	880,759				34,997				915,756
Total assets	$	1,629,155			$	43,231			$	1,672,386
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	11,701			$	—			$	11,701
Accrued expenses	68,528				—				68,528
Deferred income tax liability	30,845				(8,479		)		22,366
Notes payable and current maturities of long term debt	7,929				—				7,929
Deferred revenues	293,255				30,423				323,678
Total current liabilities	412,258				21,944				434,202
LONG TERM LIABILITIES:
Non-current deferred revenues	11,342				104,576				115,918
Non-current deferred income tax liability	120,434				(26,936		)		93,498
Debt, net of current maturities	7,366				—				7,366
Other long-term liabilities	5,586				—				5,586
Total long term liabilities	144,728				77,640				222,368
Total liabilities	556,986				99,584				656,570
STOCKHOLDERS' EQUITY
Preferred stock - $1 par value; 500,000 shares authorized, none issued	—				—				—
Common stock - $0.01 par value; 250,000,000 shares authorized; 101,993,808 shares issued at June 30, 2013	1,020				—				1,020
Additional paid-in capital	400,710				—				400,710
Retained earnings	1,072,521				(56,353		)		1,016,168
Less treasury stock at cost 16,753,889 shares at June 30, 2013	(402,082		)		—				(402,082		)
Total stockholders' equity	1,072,169				(56,353		)		1,015,816
Total liabilities and equity	$	1,629,155			$	43,231			$	1,672,386

Consolidated Statements of Cash Flows:
(In Thousands)
	Year Ended
	June 30, 2014
	As Previously Reported				Effect of Restatement				As Restated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	201,136			$	(14,421	)		$	186,715
Adjustments to reconcile net income from operations to net cash from operating activities:
Depreciation	52,935				—				52,935
Amortization	54,836				—				54,836
Change in deferred income taxes	22,032				(9,280		)		12,752
Excess tax benefits from stock-based compensation	(3,406		)		—				(3,406		)
Expense for stock-based compensation	10,091				—				10,091
(Gain)/loss on disposal of assets	(784		)		—				(784		)
Changes in operating assets and liabilities:
Change in receivables	7,498				—				7,498
Change in prepaid expenses, deferred costs and other	(15,386		)		(13,179		)		(28,565		)
Change in accounts payable	(1,252		)		—				(1,252		)
Change in accrued expenses	(6,364		)		—				(6,364		)
Change in income taxes	5,251				—				5,251
Change in deferred revenues	15,072				36,880				51,952
Net cash from operating activities	341,659				—				341,659
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for acquisitions, net of cash acquired	(27,894		)		—				(27,894		)
Capital expenditures	(33,185		)		—				(33,185		)
Proceeds from sale of assets	7,781				—				7,781
Customer contracts acquired	—				—				—
Internal use software	(16,288		)		—				(16,288		)
Computer software developed	(62,194		)		—				(62,194		)
Proceeds from investments	—				—				—
Purchase of investments	—				—				—
Net cash from investing activities	(131,780		)		—				(131,780		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facilities	25,000				—				25,000
Repayments on credit facilities	(47,158		)		—				(47,158		)
Purchase of treasury stock	(175,699		)		—				(175,699		)
Dividends paid	(71,251		)		—				(71,251		)
Excess tax benefits from stock-based compensation	3,406				—				3,406
Proceeds from issuance of common stock upon exercise of stock options	609				—				609
Minimum tax withholding payments related to share based compensation	(6,598		)		—				(6,598		)
Proceeds from sale of common stock, net	4,284				—				4,284
Net cash from financing activities	(267,407		)		—				(267,407		)
NET CHANGE IN CASH AND CASH EQUIVALENTS	$	(57,528	)		$	—			$	(57,528	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	$	127,905			$	—			$	127,905
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	70,377			$	—			$	70,377

Consolidated Statements of Cash Flows:
(In Thousands)
	Year Ended
	June 30, 2013
	As Previously Reported				Effect of Restatement				As Restated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	176,645			$	(9,035	)		$	167,610
Adjustments to reconcile net income from operations to net cash from operating activities:
Depreciation	51,967				—				51,967
Amortization	48,374				—				48,374
Change in deferred income taxes	24,091				(5,755		)		18,336
Excess tax benefits from stock-based compensation	(3,621		)		—				(3,621		)
Expense for stock-based compensation	8,615				—				8,615
(Gain)/loss on disposal of assets	3,908				—				3,908
Changes in operating assets and liabilities:
Change in receivables	(12,739		)		—				(12,739		)
Change in prepaid expenses, deferred costs and other	(4,430		)		(7,072		)		(11,502		)
Change in accounts payable	(4,582		)		—				(4,582		)
Change in accrued expenses	7,774				—				7,774
Change in income taxes	4,575				—				4,575
Change in deferred revenues	8,597				21,862				30,459
Net cash from operating activities	309,174				—				309,174
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for acquisitions, net of cash acquired	—				—				—
Capital expenditures	(46,256		)		—				(46,256		)
Proceeds from sale of assets	530				—				530
Customer contracts acquired	(186		)		—				(186		)
Internal use software	—				—				—
Computer software developed	(51,332		)		—				(51,332		)
Proceeds from investments	—				—				—
Purchase of investments	—				—				—
Net cash from investing activities	(97,244		)		—				(97,244		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facilities	—				—				—
Repayments on credit facilities	(145,180		)		—				(145,180		)
Purchase of treasury stock	(58,126		)		—				(58,126		)
Dividends paid	(48,202		)		—				(48,202		)
Excess tax benefits from stock-based compensation	3,621				—				3,621
Proceeds from issuance of common stock upon exercise of stock options	6,775				—				6,775
Minimum tax withholding payments related to share based compensation	(3,926		)		—				(3,926		)
Proceeds from sale of common stock, net	3,700				—				3,700
Net cash from financing activities	(241,338		)		—				(241,338		)
NET CHANGE IN CASH AND CASH EQUIVALENTS	$	(29,408	)		$	—			$	(29,408	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	$	157,313			$	—			$	157,313
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	127,905			$	—			$	127,905

Consolidated Statements of Cash Flows:
(In Thousands)
	Year Ended
	June 30, 2012
	As Previously Reported				Effect of Restatement				As Restated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	154,984			$	(2,944	)		$	152,040
Adjustments to reconcile net income from operations to net cash from operating activities:
Depreciation	45,322				—				45,322
Amortization	49,297				—				49,297
Change in deferred income taxes	22,610				(1,699		)		20,911
Excess tax benefits from stock-based compensation	(3,465		)		—				(3,465		)
Expense for stock-based compensation	6,950				—				6,950
(Gain)/loss on disposal of assets	1,198				—				1,198
Changes in operating assets and liabilities:
Change in receivables	(10,795		)		—				(10,795		)
Change in prepaid expenses, deferred costs and other	(22,962		)		(4,799		)		(27,761		)
Change in accounts payable	3,488				—				3,488
Change in accrued expenses	7,770				—				7,770
Change in income taxes	9,257				—				9,257
Change in deferred revenues	896				9,442				10,338
Net cash from operating activities	264,550				—				264,550
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for acquisitions, net of cash acquired	—				—				—
Capital expenditures	(41,441		)		—				(41,441		)
Proceeds from sale of assets	2,772				—				2,772
Customer contracts acquired	(720		)		—				(720		)
Internal use software	—				—				—
Computer software developed	(37,873		)		—				(37,873		)
Proceeds from investments	3,000				—				3,000
Purchase of investments	(2,000		)		—				(2,000		)
Net cash from investing activities	(76,262		)		—				(76,262		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facilities	—				—				—
Repayments on credit facilities	(35,280		)		—				(35,280		)
Purchase of treasury stock	(34,371		)		—				(34,371		)
Dividends paid	(38,128		)		—				(38,128		)
Excess tax benefits from stock-based compensation	3,465				—				3,465
Proceeds from issuance of common stock upon exercise of stock options	11,004				—				11,004
Minimum tax withholding payments related to share based compensation	(4,112		)		—				(4,112		)
Proceeds from sale of common stock, net	3,322				—				3,322
Net cash from financing activities	(94,100		)		—				(94,100		)
NET CHANGE IN CASH AND CASH EQUIVALENTS	$	94,188			$	—			$	94,188
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	$	63,125			$	—			$	63,125
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	157,313			$	—			$	157,313

Prior Period Reclassification

Certain amounts included within the consolidated statements of cash flows for the years ended June 30, 2013 and 2012 have been restated to correct an error related to the presentation of excess tax benefits from stock based compensation within cash flows from operating activities. Such correction adjusted the cash flow statement for 2013 and 2012 by presenting excess tax benefits from stock based compensation as a separate line item and increasing the change in income taxes by $3,621 and $3,465 for the respective periods. There was no change in total cash flows from operating, investing or financing activities.

QUARTERLY FINANCIAL INFORMATION

(unaudited)

The Company has restated the following quarterly financial information for the interim periods during the fiscal years ended June 30, 2014 and 2013 for the effects of the restatement more fully described in Note 15 - Restatement of Consolidated Financial Statements, as set forth below (in thousands, except for per share data):

	For the Year Ended June 30, 2014
	Quarter 1				Quarter 2				Quarter 3				Quarter 4				Total
As Previously Reported
REVENUE
License	$	11,779			$	12,893			$	15,267			$	13,070			$	53,009
Support and service	269,544				274,276				270,931				283,635				1,098,386
Hardware	14,338				15,356				14,731				14,233				58,658
Total revenue	295,661				302,525				300,929				310,938				1,210,053
COST OF SALES
Cost of license	1,412				947				1,167				747				4,273
Cost of support and service	154,583				157,893				164,223				166,744				643,443
Cost of hardware	10,941				10,867				11,008				10,892				43,708
Total cost of sales	166,936				169,707				176,398				178,383				691,424
GROSS PROFIT	128,725				132,818				124,531				132,555				518,629
OPERATING EXPENSES
Selling and marketing	21,458				21,071				22,034				22,007				86,570
Research and development	15,673				16,142				17,486				17,447				66,748
General and administrative	14,250				12,132				13,629				13,301				53,312
Total operating expenses	51,381				49,345				53,149				52,755				206,630
OPERATING INCOME	77,344				83,473				71,382				79,800				311,999
INTEREST INCOME (EXPENSE)
Interest income	131				129				84				33				377
Interest expense	(280		)		(267		)		(262		)		(296		)		(1,105		)
Total interest income (expense)	(149		)		(138		)		(178		)		(263		)		(728		)
INCOME BEFORE INCOME TAXES	77,195				83,335				71,204				79,537				311,271
PROVISION FOR INCOME TAXES	27,407				29,353				24,447				28,928				110,135
NET INCOME	$	49,788			$	53,982			$	46,757			$	50,609			$	201,136
Diluted earnings per share	$	0.58			$	0.63			$	0.55			$	0.60			$	2.36
Diluted weighted average shares outstanding	85,854				85,986				85,467				84,276				85,396
Basic earnings per share	$	0.58			$	0.63			$	0.55			$	0.60			$	2.37
Basic weighted average shares outstanding	85,294				85,450				84,981				83,740				84,866

	For the Year Ended June 30, 2014
	Quarter 1				Quarter 2				Quarter 3				Quarter 4				Total
Effects of Restatement
REVENUE
License	$	(11,017	)		$	(12,648	)		$	(14,664	)		$	(12,496	)		$	(50,825	)
Support and service	(6,914		)		(1,034		)		5,169				16,724				13,945
Hardware	—				—				—				—				—
Total revenue	(17,931		)		(13,682		)		(9,495		)		4,228				(36,880		)
COST OF SALES
Cost of license	(1,067		)		(759		)		(940		)		(599		)		(3,365		)
Cost of support and service	(5,427		)		(3,124		)		(1,399		)		1,263				(8,687		)
Cost of hardware	—				—				—				—				—
Total cost of sales	(6,494		)		(3,883		)		(2,339		)		664				(12,052		)
GROSS PROFIT	(11,437		)		(9,799		)		(7,156		)		3,564				(24,828		)
OPERATING EXPENSES
Selling and marketing	(720		)		(568		)		(315		)		476				(1,127		)
Research and development	—				—				—				—				—
General and administrative	—				—				—				—				—
Total operating expenses	(720		)		(568		)		(315		)		476				(1,127		)
OPERATING INCOME	(10,717		)		(9,231		)		(6,841		)		3,088				(23,701		)
INTEREST INCOME (EXPENSE)
Interest income	—				—				—				—				—
Interest expense	—				—				—				—				—
Total interest income (expense)	—				—				—				—				—
INCOME BEFORE INCOME TAXES	(10,717		)		(9,231		)		(6,841		)		3,088				(23,701		)
PROVISION FOR INCOME TAXES	(4,149		)		(3,609		)		(2,690		)		1,168				(9,280		)
NET INCOME	$	(6,568	)		$	(5,622	)		$	(4,151	)		$	1,920			$	(14,421	)
Diluted earnings per share	$	(0.08	)		$	(0.07	)		$	(0.05	)		$	0.02			$	(0.17	)
Diluted weighted average shares outstanding	85,854				85,986				85,467				84,276				85,396
Basic earnings per share	$	(0.08	)		$	(0.07	)		$	(0.05	)		$	0.02			$	(0.17	)
Basic weighted average shares outstanding	85,294				85,450				84,981				83,740				84,866

	For the Year Ended June 30, 2014
	Quarter 1 (As Restated)				Quarter 2 (As Restated)				Quarter 3 (As Restated)				Quarter 4 (As Restated)				Total (As Restated)
As Restated
REVENUE
License	$	762			$	245			$	603			$	574			$	2,184
Support and service	262,630				273,242				276,100				300,359				1,112,331
Hardware	14,338				15,356				14,731				14,233				58,658
Total revenue	277,730				288,843				291,434				315,166				1,173,173
COST OF SALES
Cost of license	345				188				227				148				908
Cost of support and service	149,156				154,769				162,824				168,007				634,756
Cost of hardware	10,941				10,867				11,008				10,892				43,708
Total cost of sales	160,442				165,824				174,059				179,047				679,372
GROSS PROFIT	117,288				123,019				117,375				136,119				493,801
OPERATING EXPENSES
Selling and marketing	20,738				20,503				21,719				22,483				85,443
Research and development	15,673				16,142				17,486				17,447				66,748
General and administrative	14,250				12,132				13,629				13,301				53,312
Total operating expenses	50,661				48,777				52,834				53,231				205,503
OPERATING INCOME	66,627				74,242				64,541				82,888				288,298
INTEREST INCOME (EXPENSE)
Interest income	131				129				84				33				377
Interest expense	(280		)		(267		)		(262		)		(296		)		(1,105		)
Total interest income (expense)	(149		)		(138		)		(178		)		(263		)		(728		)
INCOME BEFORE INCOME TAXES	66,478				74,104				64,363				82,625				287,570
PROVISION FOR INCOME TAXES	23,258				25,744				21,757				30,096				100,855
NET INCOME	$	43,220			$	48,360			$	42,606			$	52,529			$	186,715
Diluted earnings per share	$	0.50			$	0.56			$	0.50			$	0.62			$	2.19
Diluted weighted average shares outstanding	85,854				85,986				85,467				84,276				85,396
Basic earnings per share	$	0.51			$	0.57			$	0.50			$	0.63			$	2.20
Basic weighted average shares outstanding	85,294				85,450				84,981				83,740				84,866

	For the Year Ended June 30, 2013
	Quarter 1				Quarter 2				Quarter 3				Quarter 4				Total
As Previously Reported
REVENUE
License	$	12,864			$	13,210			$	16,681			$	12,063			$	54,818
Support and service	244,585				250,310				250,415				269,901				1,015,211
Hardware	13,552				15,174				14,447				16,184				59,357
Total revenue	271,001				278,694				281,543				298,148				1,129,386
COST OF SALES
Cost of license	1,077				1,251				1,360				1,136				4,824
Cost of support and service	143,418				144,683				155,012				160,807				603,920
Cost of hardware	10,578				10,523				10,581				11,968				43,650
Total cost of sales	155,073				156,457				166,953				173,911				652,394
GROSS PROFIT	115,928				122,237				114,590				124,237				476,992
OPERATING EXPENSES
Selling and marketing	20,189				19,937				20,935				20,558				81,619
Research and development	14,645				15,691				15,996				16,870				63,202
General and administrative	13,578				27,181				11,950				13,915				66,624
Total operating expenses	48,412				62,809				48,881				51,343				211,445
OPERATING INCOME	67,516				59,428				65,709				72,894				265,547
INTEREST INCOME (EXPENSE)
Interest income	187				190				133				130				640
Interest expense	(1,341		)		(1,261		)		(1,034		)		(2,701		)		(6,337		)
Total interest income (expense)	(1,154		)		(1,071		)		(901		)		(2,571		)		(5,697		)
INCOME BEFORE INCOME TAXES	66,362				58,357				64,808				70,323				259,850
PROVISION FOR INCOME TAXES	23,887				17,852				18,812				22,654				83,205
NET INCOME	$	42,475			$	40,505			$	45,996			$	47,669			$	176,645
Diluted net income per share	$	0.49			$	0.47			$	0.53			$	0.55			$	2.04
Diluted weighted average shares outstanding	86,605				86,639				86,705				86,525				86,619
Basic net income per share	$	0.49			$	0.47			$	0.53			$	0.56			$	2.05
Basic weighted average shares outstanding	86,109				86,084				86,120				85,845				86,040

	For the Year Ended June 30, 2013
	Quarter 1				Quarter 2				Quarter 3				Quarter 4				Total
Effects of Restatement
REVENUE
License	$	(11,498	)		$	(12,231	)		$	(15,150	)		$	(10,573	)		$	(49,452	)
Support and service	(4,470		)		785				7,524				23,751				27,590
Hardware	—				—				—				—				—
Total revenue	(15,968		)		(11,446		)		(7,626		)		13,178				(21,862		)
COST OF SALES
Cost of license	(1,004		)		(1,025		)		(1,132		)		(803		)		(3,964		)
Cost of support and service	(3,756		)		(2,330		)		(350		)		4,136				(2,300		)
Cost of hardware	—				—				—				—				—
Total cost of sales	(4,760		)		(3,355		)		(1,482		)		3,333				(6,264		)
GROSS PROFIT	(11,208		)		(8,091		)		(6,144		)		9,845				(15,598		)
OPERATING EXPENSES
Selling and marketing	(697		)		(532		)		(469		)		890				(808		)
Research and development	—				—				—				—				—
General and administrative	—				—				—				—				—
Total operating expenses	(697		)		(532		)		(469		)		890				(808		)
OPERATING INCOME	(10,511		)		(7,559		)		(5,675		)		8,955				(14,790		)
INTEREST INCOME (EXPENSE)
Interest income	—				—				—				—				—
Interest expense	—				—				—				—				—
Total interest income (expense)	—				—				—				—				—
INCOME BEFORE INCOME TAXES	(10,511		)		(7,559		)		(5,675		)		8,955				(14,790		)
PROVISION FOR INCOME TAXES	(3,996		)		(2,956		)		(2,179		)		3,376				(5,755		)
NET INCOME	$	(6,515	)		$	(4,603	)		$	(3,496	)		$	5,579			$	(9,035	)
Diluted net income per share	$	(0.08	)		$	(0.05	)		$	(0.04	)		$	0.06			$	(0.10	)
Diluted weighted average shares outstanding	86,605				86,639				86,705				86,525				86,619
Basic net income per share	$	(0.08	)		$	(0.05	)		$	(0.04	)		$	0.06			$	(0.11	)
Basic weighted average shares outstanding	86,109				86,084				86,120				85,845				86,040

	For the Year Ended June 30, 2013
	Quarter 1 (As Restated)				Quarter 2 (As Restated)				Quarter 3 (As Restated)				Quarter 4 (As Restated)				Total (As Restated)
As Restated
REVENUE
License	$	1,366			$	979			$	1,531			$	1,490			$	5,366
Support and service	240,115				251,095				257,939				293,652				1,042,801
Hardware	13,552				15,174				14,447				16,184				59,357
Total revenue	255,033				267,248				273,917				311,326				1,107,524
COST OF SALES
Cost of license	73				226				228				333				860
Cost of support and service	139,662				142,353				154,662				164,943				601,620
Cost of hardware	10,578				10,523				10,581				11,968				43,650
Total cost of sales	150,313				153,102				165,471				177,244				646,130
GROSS PROFIT	104,720				114,146				108,446				134,082				461,394
OPERATING EXPENSES
Selling and marketing	19,492				19,405				20,466				21,448				80,811
Research and development	14,645				15,691				15,996				16,870				63,202
General and administrative	13,578				27,181				11,950				13,915				66,624
Total operating expenses	47,715				62,277				48,412				52,233				210,637
OPERATING INCOME	57,005				51,869				60,034				81,849				250,757
INTEREST INCOME (EXPENSE)
Interest income	187				190				133				130				640
Interest expense	(1,341		)		(1,261		)		(1,034		)		(2,701		)		(6,337		)
Total interest income (expense)	(1,154		)		(1,071		)		(901		)		(2,571		)		(5,697		)
INCOME BEFORE INCOME TAXES	55,851				50,798				59,133				79,278				245,060
PROVISION FOR INCOME TAXES	19,891				14,896				16,633				26,030				77,450
NET INCOME	$	35,960			$	35,902			$	42,500			$	53,248			$	167,610
Diluted net income per share	$	0.42			$	0.41			$	0.49			$	0.62			$	1.94
Diluted weighted average shares outstanding	86,605				86,639				86,705				86,525				86,619
Basic net income per share	$	0.42			$	0.42			$	0.49			$	0.62			$	1.95
Basic weighted average shares outstanding	86,109				86,084				86,120				85,845				86,040