<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
----------------------
Date of Report (Date of earliest event reported) December 28, 1999
-----------------
CENTURY BUSINESS SERVICES, INC.
-------------------------------
(Exact name of registrant as specified in its charter)
Delaware 22-2769024
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
0-25890
-------
(Commission File Number)
6480 Rockside Woods Blvd., South, Suite 330
Cleveland, Ohio 44131
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code (216) 447-9000.
---------------
<PAGE> 2
Century Business Services, Inc. (the "Company") is filing this Current
Report on Form 8-K/A to amend its Current Report on Form 8-K dated December 28,
1999 and filed December 30, 1999 to clarify its rationale regarding its recent
decision to shorten its period of goodwill amortization from 40 years to a more
conservative 15 years, effective October 1, 1999.
ITEM 5. OTHER EVENTS.
On December 28, 1999, the Company announced, among other things, that
it had decided to shorten its period of goodwill amortization from 40 years to a
more conservative 15 years, beginning October 1, 1999. The Company's decision
was based on its requirement under APB Opinion No. 17, Intangible Assets, to
continually evaluate its goodwill amortization period to determine whether later
events and circumstances warrant a revision to estimates previously used.
Factors used by the Company in its re-evaluation included, among other things,
regulatory provisions that may limit the maximum useful life of goodwill, the
effects and actions of competitors, its current consolidation and national
branding efforts, and other general economic factors.
The Financial Accounting Standards Board recently issued an exposure
draft that includes a provision to reduce the period of amortization of goodwill
from a maximum of 40 years to 20 years or less. Also, the competitive landscape
of the outsourced business services industry has changed dramatically over the
past several months, including an increased number of competitors in the
industry, recent publicity about larger competitors concerning the potential
spin-off of their consulting practices (i.e., Big Five), and the continued
emphasis on consolidation and strategic alliances across industry lines in this
marketplace. Finally, the Company's recently announced consolidation and ongoing
branding efforts may impact its workforce and existing client relationships
As a result of the factors discussed above, the Company has decided to
shorten its goodwill amortization period to a more conservative 15 years from 40
years, beginning October 1, 1999. Although the Company's decision will reduce
earnings per share in future periods due to the accelerated amortization
schedule, it will not affect earnings before interest, taxes, depreciation, and
amortization (EBITDA), cash flow, or other solid business fundamentals. The
non-cash impact of this amortization change on the Company's net income for the
three months ended December 31, 1999 and the year ended December 31, 2000 will
be approximately $4.3 million ($0.043 per diluted share) and $16 million ($0.16
per diluted share), respectively. Had the Company adopted the change on January
1, 1999, the non-cash impact of this amortization change on the Company's net
income for the nine months ended September 30, 1999 would have been
approximately $9.7 million ($0.11 per diluted share).
ITEM 7. EXHIBITS -- NONE.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CENTURY BUSINESS SERVICES, INC.
Date: January 27, 2000 /s/ Charles D. Hamm, Jr.
--------------------------------
Charles D. Hamm, Jr.
Chief Financial Officer
