Elena Charles - Vice President, Investor Relations Gary C. Butler - President, Chief Executive Officer,Director Christopher R. Reidy - Chief Financial Officer, VicePresident

Rod Bourgeois - Sanford C. Bernstein Kartik Mehta - FTN Midwest Research Jim Kissane - Bear Stearns Adam Frisch - UBS David Grossman - Thomas Weisel Partners Elizabeth Grausam - Goldman Sachs Charles Murphy - Morgan Stanley Gary Bisbee - Lehman Brothers Mark Marcon - Robert W. Baird & Co. Gregory Smith - Merrill Lynch Michael Baker - Raymond James Tien-tsin Huang - JP Morgan

Good morning. My name is Carol and I will be your conferenceoperator. At this time, I would like to welcome everyone to the Automatic DataProcessing Incorporate first quarter fiscal 2008 earnings conference call.(Operator Instructions) Thank you. I will now turn the call over to ElenaCharles, Vice President of Investor Relations. Ms. Charles, you may begin.

Thank you. Good morning. I’m Elena Charles. Here thismorning is Gary Butler, ADP's President and CEO; and Chris Reidy, ADP's ChiefFinancial Officer. A slide presentation accompanies today’s earnings call andwebcast and it is available for you to print from the investor relationshomepage of our website at adp.com. Just to remind you, the first quarter of fiscal 2008 plus a two-yearhistory of revenue and pretax earnings for our new reportable segment has beenposted to the IR section of our website as well. During today’s conferencecall, we will discuss some forward-looking statements that involve some risks,and these are discussed on page two of the slide presentation and in ourperiodic filings with the SEC. With that introduction, I will turn the call over to Garyfor his opening remarks. Gary C. Butler: Thank you, Elena. Good morning, everybody and welcome to thecall. I’ll begin today’s call with some opening remarks about our firstquarter. Then I’ll turn it over to Chris, who will take you through the moredetailed results and then I’ll return a little later in the call to provide youwith an update on our guidance for fiscal 2008. And you can see, in spite ofthe headwinds from lower interest rates, we are forecasting yet another strongyear for ADP. Also at the end, before we go to Q&A, I’ll discuss why Ibelieve that ADP has never been better positioned to take advantage of thegrowth opportunities in the large and growing markets that we server. First let me say I am very pleased with our results for thefirst quarter. We are off to an excellent start for fiscal ’08. Businessmomentum is strong and we are ahead of our expectations. We continue to executeagainst our growth strategies and you can see that we are achieving the desiredresults of double-digit revenue growth with pretax margin expansion. In this quarter, we also acquired three smaller distributorsto buy our dealer services Autoline product that support our strategy ofexpanding our direct presence in key rural markets in the dealer community.These acquisitions will add about $20 million in revenues to fiscal 2008. Revenue growth for the quarter was a strong 13.5%, and weachieved better-than-anticipated pretax margin expansion, excluding last year’snet one-time gain. Sales growth in employer services was double-digit and I ampleased with dealer strong sales growth. Client retention was excellent in bothemployer services and dealer services as well. Our cash balances are down from the $1.9 billion at fiscal’07 year-end, June 30th, to approximately $1.5 billion. This excludes theassets related to the reverse repurchase agreement discussed in the pressrelease. Year-to-date, we returned $560 million to our shareholders,buying back nearly $12 million shares of ADP stock. Again, off to a great startfor the year and with that, I’ll turn it over to Chris for a more detailedview. Christopher R. Reidy: Thanks, Gary, and good morning, everyone. As Gary saidearlier, our results for the quarter were terrific. Total revenues grew 13.5%to $2 billion and client fund interest revenues grew 15%, from balanced growthof 7.5% and a 30-basis point improvement in the average interest yield of 4.6%. I would like to remind you that we had a net one-time gainin last year’s first quarter, so we are showing here the first quarter fiscal2008 comparisons including and excluding last year’s net one-time gain. On an apples-to-apples basis, excluding last year’s one-timegain, pretax earnings grew 21% and the pretax margin expanded 110 basis points,and earnings per share from continuing operations increased 25% to $0.45 ashare. Turning to slide 5, we’ll talk about share repurchases andour cash balances at September 30th. As Garymentioned earlier, we repurchased nearly 12 million share fiscal year-to-datefor about $560 million. As we had indicated on our last earnings call, thislevel of share buy-backs is higher than historical buy-back levels but lowerthan last quarter’s $1.1 billion buy-back, which included investing thedividend from the Broadridge spin-off. The share buy-back to date are anticipated to be a littleover $0.01 accretive for the full fiscal year 2008. With nearly 11 million shares purchased in the quarter at acost of about $514 million, we have reduced our cash balances from June 30th to$1.5 billion at September 30th. This excludes the assets related to anoutstanding reverse repurchase agreement of about $345 million that matured onOctober 1st. The bottom line is that we continue to return excess cash toour shareholders. Now let’s turn to slide 6. Employer services had a terrific first quarter.Eleven-percent revenue growth, with 9% organic growth and 8% growth in ourtraditional payroll and tax filing business in the United States. Our BeyondPayroll revenues grew 18% in the U.S. Strong performance from Employease and VirtualEdgethat were both acquired last year, as well as comprehensive outsourcingservices in time and attendance contributed to the strong Beyond Payrollgrowth. I do want to point out that the PEO is a separate reportablesegment this year and is no longer included in ES Beyond Payroll metrics. ES' pretax margin of over 50 basis points was better thananticipated and results from increased operating efficiencies, and thisincluded a drag from last year’s acquisitions that closed after last year’sfirst quarter. Pays per control, a same-store sales metric, was up 1.6% inthe quarter, and average client fund balances were up 7.5%. Client retention was terrific in the quarter, improving 50basis points over last year to a new record level. New business sales growth,which includes both ES and PEO, was 11% and all market-facing segments achieveddouble-digit sales growth. Now let’s turn to slide 7. We are very pleased with the strong results for the PEO thisquarter. Revenues grew a strong 21% and you see the pretax margin increasedover 250 basis points. About half of the margin expansion is coming from growthin the business and the other half from an easy compare with last year’s firstquarter. This improvement felt good to us and we are raising our full-yearestimates for pretax margin expansion, as you’ll hear from Gary later on. The number of average worksite employees paid during thequarter increased 19% to 165,000. Moving on to dealer services, dealer also had a very solidfirst quarter. Total revenues grew 8%, organic revenue growth was 6% comparedwith 4% in last year’s first quarter, and we are on track to improve organicrevenue growth for the full year to 7% or 8%, which is over last year’s 6%. As Gary mentioned earlier, during the quarter we acquiredthree distributors of our dealer services Autoline product. There are terrificacquisitions that support our strategy of expanding our direct presence inAsia, Portugal and Mexico. In the first quarter, there was a drag on dealer’s pretaxmargin from these acquisitions, and despite the impact of these acquisitions,dealer services pretax margin expanded nearly 70 basis points from increasedbusiness momentum and expense control. New business sales were strong internationally with ourAutoline product and in North America with sales of products such as digital marketingand IP telephony. Now I will turn it back to Gary for an update on ourfull-year forecast. Gary C. Butler: Thank you, Chris. Just for everybody, we’re on slide 9 andat this point, I’ll update our fiscal 2008 revenue guidance. We are raising ourrevenue growth forecast to 12% to 13%. This is based primarily due to ourcurrent estimate of the benefit from foreign exchange rates, as well as theacquisition activity in dealer services that we spoke to earlier. As you know, we have lowered the anticipated growth inclient funds interest. We are, however, still forecasting an increase of about8%, which is about $30 million to $40 million lower than our previous forecastof 13% to 14% growth. This revision is based on fed funds futures contracts andforward yield curves which call for 75 basis points of reductions in the fedfunds rate over the remainder of the fiscal year, and this is in addition tothe 50 basis points reduction since our original forecast in July. Also, just to give you another data point, even had we hadthe entire 125 basis point reduction in fed funds rate, effectively loweringthe rate to 4%, if this rate had been in effect for the entire fiscal yearsince July 1st, our forecast for interest on client funds would have been lowerby an additional $10 million to $20 million. The average yield on the client funds portfolio isforecasted to be nearly 4.5% for the year. Now, this is different from ourprevious forecast by about 20 basis points, where we had forecast improvementto 4.7% over last year’s 5.5%. We are also anticipating 7% to 8% growth in client fundsbalances, which is slightly lower than our previous forecast of over 8%. We dothink we will see lower wage growth this year as a result of early indicationsthat year-end bonuses may not be quite as robust as last year, and this year’spay growth appears to be slightly lower than our internal plan, as we areforecasting about 1.5% growth in our pace per control metric, compared with 2%in our previous forecasts. I am now switching to slide 10 to review the EPS forecast.We do anticipate another strong year of earnings growth and as I statedearlier, I am particularly pleased to express confidence in our ability toattain the high-end of our earnings per share forecast from continuingoperations. Just to remind the audience, the 18% to 21% growth iscompared with $1.80 per share a year ago, which does include the impact of thenet one-time gain -- which does exclude the impact of the net one-time gainfrom last year’s first quarter. We continue to see positive momentum in thebusinesses, as evidenced by the strong business metrics we reported today. Andwe believe the strength of our first quarter results and the $0.01 or sobenefit from year-to-date share repurchases will counteract the 4% to 5% dragfrom the estimated reduction to earnings per share from our updated interestforecast on client funds. In our forecast, there are no further share buy-backscontemplated in the ’08 guidance, although it is our intent to continue to buyback shares at higher-than-historical levels, again depending upon marketconditions, but also not at the aggressive levels of last year’s fourthquarter, which included returning the dividend from the spin-off of thebrokerage business. I am now switching to slide 11 to talk about guidance bybusiness segment. On slide 11, you will see our updated guidance for thedifferent business segments. I thought this table would help you clearly depictthe current forecast for the year and also compare it to our previous forecast. So for employer services, and again, this excludes the PEOservices, we do anticipate for ES about 10.5% revenue growth, slightly downfrom our previous forecast of 11% revenue growth and this is due to theanticipated lower client funds balance growth, as I mentioned earlier. And to remind you, employer services is credited withrevenue at a constant 4.5% interest rate on client funds balances and istherefore not impacted by the changing interest rates. We do anticipate animprovement in pretax margin expansion of 70 to 120 basis points. This is upnotably from our previous estimate of 50 to 100 basis points improvement. As we switch to the PEO services segment, we are raising ourrevenue growth forecast to 19% to 20% from 18% to 19% previously forecasted,and we are estimating higher margin expansion of 50 to 90 basis points comparedto about 50 basis points previously forecasted. We have stayed the course with our forecast on new businesssales, so we are confirming that forecast for high sales growth -- for salesgrowth in the high single digits to low double digits. Dealer services -- we anticipate revenue growth of about 10%for dealer services. This is up from our previous forecast of 8% to 9% and itis due primarily to the first quarter acquisitions that both Chris and I spokeabout a little earlier. And as a result of the cost associated with theseacquisitions, we do anticipate pretax margin improvement of 70 to 90 basispoints, compared with our prior forecast of over 100 basis points. Now let’s turn to slide 12 as I try to summarize where weare. So to recap for the quarter, revenue growth was a strong 13.5%. Pretax andnet earnings increased 21%, and earnings per share increased 25%, againexcluding last year’s first quarter net one-time gain. Our expectations for the year are strong, despite theexpected lower interest rate environment. Anticipated revenue growth for theyear is once again double digit. Pretax margins are improving across the board,and we are confident we will attain the high end of our EPS growth forecasts. I would also like to take this opportunity while I have youall here to share some comments on the portfolio and the credit markets. First of all, ADP's investment guidelines are very prudent. Ourinvestment portfolios for both our client and corporate funds, as well as ourability to borrow in the commercial paper markets, have not in any way beenadversely affected by the recent turmoil in the credit markets. ADP only invests in highly liquid, investment grade fixedincome securities. Our overall investment portfolio quality is very high atAAA/AA, and ADP has zero exposure to sub-prime, asset-backed or mortgage-backedsecurities, or asset-backed commercial paper. And ADP has zero exposure to CDOsand CLOs, which are collateralized debt and collateralized loan obligations. Finally, I would like to express my views on why I believethat ADP is much better positioned today than it was some five or six years agowhen the economy softened at that time and why I believe the new ADP cansuccessfully execute our growth objectives over the long-term horizon. First, as we think about the new ADP, we have divested fourslow or no-growth businesses over the last 18 months. Second, I also believeADP is much better positioned today. We are keenly focused on two large,under-penetrated markets in employer services and dealer services, and theyboth have strong, underlying growth attributes and both businesses have 90%recurring revenues. Third, our product line today has never been more completeand we have excellent competitive positions across all of the markets we serve.In the international markets, our GlobalView product and Autoline product arewinning market share handily and our largest organic growth opportunity inHRBPO is yielding tremendous results. The PEO, as you can see, is growing veryrobustly. COS in the high-end of the market is doing great. In fact, it turnedprofitable this month, and we are very pleased with our new administrative servicesoffering, which is basically the PEO without co-employment for the middlemarket, is not starting to gain ground. We have an abundance of new offerings that we didn’t have anumber of years ago that are driving incremental market share gains. I couldn’tbe more pleased with our success in VirtualEdge, our Employease acquisition,which is gaining share for new payroll and benefits in the mid markets, ourworkers’ comp and healthcare initiatives are gaining traction, and in dealerservices, we are having great success with IP telephony and our acquisitionresults. Fourth, in addition to the inherent scale advantage that weget from volume that drives improved margins, we have a number of other effortsunderway to continue to augment these margins over time. And fifth, our commitment to return excess cash toshareholders through share repurchases and higher dividends remains verystrong. So in closing, I believe ADP is on a very clear path toincrease shareholder value by executing on the strategic initiatives discussedwith you both today and over the last year. I hope you can see why I remainvery excited about ADP's future growth opportunities. So with that, I will conclude and turn it over to theoperator to take your questions.

(Operator Instructions) Our first question will come fromthe line of Rod Bourgeois with Bernstein. Rod Bourgeois -Sanford C. Bernstein: Good morning. Gary, I wanted to inquire about what isenabling you to increase your margin targets for fiscal ’08? I guessspecifically what I wanted to ask about, is the increased margin outlook inreaction to the lower float outlook? Or is the new margin outlook something youwould have granted to us even if the float situation had not worsened? Gary C. Butler: Well, we definitely would have improved margins had floatnot gone the opposite way. I guess the good news is we are on track or ahead ofwhere we thought we would be on some of the margin expansion and that, coupledwith the accretion from the share buy-backs, has put us in a position to putout a pretty good forecast. Rod Bourgeois -Sanford C. Bernstein: All right, so just to be really precise here though, afteryou saw the yield curve drop during the quarter, did you get more aggressive withyour margin targets than you would have in sort of a normal course scenario onthe float side? Christopher R. Reidy: We didn’t do anything unnatural in terms of clamping down onexpense or kind of starving areas. This is really more just the momentum in thebusiness, as well as the fruition of some margin initiatives that we’ve beentalking about for a while -- things like the data center consolidation, [smartsharing], telesales -- all the things that we were planning on doing anyway. So it wasn’t that we just clamped on expenses completely tooffset the other. Rod Bourgeois -Sanford C. Bernstein: Okay, great. And the other obstacle that appeared to haveoccurred in the quarter is pays per control growth slowed some, and then alsoyour client funds balance growth. It looks like the outlook has come downthere. Can you talk specifically to what you are seeing in terms of the keyeconomic trends in your client base that’s causing you particularly to take theclient funds balance growth outlook down? You mentioned a lower outlook forbonus activity. Can you talk specifically to what you are seeing in therelevant economic trends? Gary C. Butler: We wouldn’t generally get to that level of detail, Rod. Wesee bonuses pending on fiscal year-ends and people getting prepared for thecalendar year-end, which is when most of the bonuses are paid. And obviouslythis has not been a banner year on Wall Street, which is also generally a placewhere we do benefit from higher bonuses. I think we are pretty good at forecasting our balances andour people and our money movement center are quite skilled at this, so theybasically, through educated experience, have come up with this forecast andfrankly, I think they are probably right. Rod Bourgeois -Sanford C. Bernstein: Okay, and one other quick question, Gary; given you are ableto keep your revenue targets intact, despite some of the headwinds that you areseeing with pays per control and the float situation, is there somethinghappening in your ancillary sales that are surprising on the upside? When youlook at your portfolio of newer products, is there anything that is shiningthrough there? Gary C. Butler: Well, you know, a couple of things are going on there, Rod.One is we finished June with a very strong sales finish, which obviously gaveus momentum from the revenue side. We also had a strong sales quarter in thefirst quarter, which gave us continued momentum. We have very strong momentumin our GlobalView sales, which we talked about for quite some time. We aredoing very well in our national accounts area with our COS product. And wecontinue to see great sales success in not just COS but our time and labormanagement products and I couldn’t be more delighted with the penetration weare getting with Employease and VirtualEdge across the enterprise. Dealer is doing great on the large dealer groups, as well assome of the new products that I mentioned in my opening comments. Christopher R. Reidy: Bear in mind, Rod, that the rule of thumb that we use onpays per control is if the 2% goes to 1%, that’s about a $20 million impact onrevenue, so it’s not all that substantial. And there were a number of otherfactors in the revenue. We had a pick-up a little bit of about $20 million orso from the dealer acquisitions, as well as the fact that the foreign exchangerates, as you saw, lifted the first quarter by about 1%, the dollar being veryweak. And if we just look out and forecast based on where the dollar is today,that accounts for the biggest portion of the increase of the total revenue from12% guidance to the 12% to 13% guidance. Gary C. Butler: Rod, also the statistic that we quote, the 1.6, is our autopay product, which is our historical mid-market product. And we did see alittle bit of a decline there in this quarter. As you may recall, we also hadin the first quarter of last year, it was 1.7% -- or the second quarter, Elenahas corrected me here. So this can be aberrations and even though we don’tdisclose the other statistics, we still saw pretty nice growth in the low-endof the market and the high-end of the market in terms of same-store growth fromsome of our other products that was at a higher level than the 1.6. We don’t go to that level of detail in our reporting but weare seeing some drag but nothing like falling off the cliff or anything. Rod Bourgeois -Sanford C. Bernstein: You can’t give a blended number for the pays per controlgrowth across your whole client base? Christopher R. Reidy: No. Rod Bourgeois -Sanford C. Bernstein: Okay. All right, thanks, guys.

Our next question comes from the line of Kartik Mehta withFTN Midwest Research. Kartik Mehta - FTNMidwest Research: Good morning, Gary. I wanted to ask you a little bit aboutthe ES side. How much of that was net client growth? It sounds like the topline, if you exclude what’s happening in the interest rate environment, isstill in line with your expectation, or maybe even a little bit better. I waswondering if you could break that down to maybe how of that is net new clientgrowth? Gary C. Butler: The best place to go look at that is a core growth in ourpayroll and tax filing revenue, which was up I think 8% for the quarter. Thatmetric is probably the one that most clearly reflects the net new business addfrom new clients. And you’ve got to be careful about clients because you maynot sell as many two-man payrolls but you may -- that generate smaller revenuenumbers but you may be having great success up market, which is driving newbusiness revenue from new clients, maybe not exactly just client count. So that’s why we look at that blended number and just likewe got last year in that 8% to 9% range, we’re seeing a continuation of net newbusiness in that revenue line, and again to remind you, that’s the single highestmargin contribution line in all of ADP. So we are delighted. Kartik Mehta - FTNMidwest Research: Chris, if you looked at your float portfolio and assumingthe interest rate decline that happened, that are being forecasted, will youchange how you manage the float portfolio in any way? Or will you keep the samementality right -- Christopher R. Reidy: On the contrary, this is why we have the strategy that wedo. In a rising interest rate environment, we don’t experience that immediatelybecause of the reinvestment portfolio, but in a declining interest rateenvironment, we are somewhat protected against that over time because we areonly exposed to the extent that we are reinvesting. So since we are investing alittle bit longer term, that lessens our exposure to the short-term rate. So the metric that we use, and this changes as the durationof the portfolio changes, but our current metric on the impact is that as theshort-term fed funds rate changes by 25 basis points, it has about a $5 millionimpact on us and across the whole yield curve, a 25 basis point decline is an $11 million impact. The reason whythat’s as little as it is is because we tend to invest a little bit longer termand not put everything into short-term rates. So we are very pleased with thatstrategy, particularly in this environment. Kartik Mehta - FTNMidwest Research: Are you looking to extend that duration at all or are you -- Christopher R. Reidy: It actually did extend a little bit since the beginning ofthe year to 2.4. That’s up from 2.3 but when you have the size of a portfoliowe have, it’s hard to move that dramatically, but we have a little bit. Where that shows up is that same rule of thumb at year-endwould have been a $7 million impact for 25 basis points change in the fed fundrate, so the change from 7 to 5 is really indicative of the fact that we lookeda little bit more long-term. Kartik Mehta - FTNMidwest Research: And Gary, a little bit of a bigger picture question; I knowat the beginning you had stated that you want to return capital back to theshareholders, but as you look at today and as the markets changed, how do youcompare acquisition opportunities to share buy-back? And by that I mean, arethe prices for acquisitions and returns improving so that you have anopportunity to make more acquisitions over the next couple of years, or atleast over this fiscal year, versus share buy-backs? Gary C. Butler: That’s about four questions rolled into one, but I’ll do mybest. First of all, historically we were chasing large acquisitions -- thethird leg, fourth leg, fifth leg, which we were totally off of that approachtoday. And we are looking more for smaller acquisitions, like a VirtualEdge oran Employease or a BZ Results, where we can leverage our large distributionchannel and sell back into our very large client base of over 500,000 clientsto drive organic revenue growth rather than acquired revenue growth. We are going to remain on that track. We have no intentionsto change. Probably the biggest challenge for us from an acquisition standpointis not the price, because we are willing to pay, and I haven’t seen any realdelta in pricing over the last year, but we are willing to pay for the rightkind of acquisitions. But I think the good news is that we have a pretty completeproduct line at this point and we have large, under-penetrated markets. Sowe’re just trying to drive the heck out of penetration and sale of thoseproducts, and if we find new acquisitions that make sense to where we canleverage the distribution, then so be it, we’ll do it. Kartik Mehta - FTNMidwest Research: Great. Thank you very much.

Our next question comes from the line of Jim Kissane withBear Stearns. Jim Kissane - BearStearns: Great job, guys. Could you break out the U.S. employerservices sales growth? I don’t think I caught it. Christopher R. Reidy: No, we haven’t done that and I think if you’ll recall on thelast earnings call, Jim, we talked about the fact that the lines are blurringwith the GlobalView product that we have, so it’s difficult to be that precise.So going forward, we will just do a worldwide metric. Jim Kissane - BearStearns: Can you give us a sense of the tone in the U.S. on the salesside? Christopher R. Reidy: Not materially different. Gary C. Butler: It’s positive, Jim. There’s nothing there -- there’s no needto roll over the rock. Jim Kissane - BearStearns: Okay, and just following up on the pays per control, anysense on intra-quarter trends? I know it bumps around a little bit, but you aretalking about 1.5% for the full year now. Gary C. Butler: I think we just think that’s prudent to do, based on thefirst quarter and based on what we are seeing in the market. So I think it’sthe right thing to do. Jim Kissane - BearStearns: Okay, excellent, and just an update on progress for GlobalViewimplementations? Gary C. Butler: Implementation as a general statement remains on track.There are a few bumps in the road, mostly caused by clients not being able tohandle some of the implementations, because when you are implementing in 10 or20 countries, it’s pretty much the burden on the client as well as a challengefor ADP. Our sales results for the fourth quarter and the first quarter in GlobalViewwere on track and considerably over last year, so pretty much business asusual. Jim Kissane - BearStearns: Thanks, Gary.

Our next question comes from the line of Adam Frisch withUBS. Adam Frisch - UBS: Great, thanks and good morning. Real nice job on thequarter, pretty strong across the board on execution. But some naysayers mightlook at the pays per control, I know other guys in Q&A have kind of touchedon this, some of the naysayers might look at the pays per control and aslightly slower client fund as early indications of your business slowing, so Ihave three questions on that front, and Gary, I’ll give them one at a time. One, are these leading indicators of your business, or arethere lots of other things that go into it? And if so, how far into the futurecould we see a possible slowdown in growth? Gary C. Butler: We’ve seen a slight degradation in pays per control and thebalances, which we have shared with you. I think if you were to be looking atthe national employment report or the DLS reports, I don’t think that’s a wholelot different than the economy in general. We just have a different slant or aweighted average across industry groups. I think our base is reflecting pretty much what’s happenedin the general economy, and again, even if it goes to 1% rather than 1.5%, youare talking about another $7 million or $8 million in revenue, so on an $8.5billion enterprise, if we can’t figure out a way to deal with that, then wehave other challenges. So I’m pretty comfortable. You never know what’s going tohappen but based on everything I know, I think we are in pretty good shape. Adam Frisch - UBS: Do you still feel that the street is always -- how do I wantto say this -- that the street always couples the macro stuff that is going onwith employment and wages and stuff like what we just talked about with some ofthe secular trends in payroll outsourcing, where some of the secular trends ofeither penetration is still relatively low, or you have growth of new productsand all that kind of stuff somewhat offsets some of the macro stuff that mightbe slowing a little bit? Is there still somewhat of a misunderstanding there doyou think that the street has? Gary C. Butler: Well, I think there’s a couple of things. I think theanalyst community as a general statement is more concerned about interest ratefluctuation than I am. Certainly it is always better to have the wind at yourback than the wind in your face, but ADP's been dealing with flowed income for20-something years, and with the exception of the time when we got all the wayto 1% fed funds rate and we had a collapse of the brokerage industry at thesame time and slower employment, we’ve been able to deal with the vagaries ofthe fed funds rate for a long period of time. Obviously if the fed funds goes to 1% again, it’s notsomething that I would particularly look forward to. But if we had normalcycles here, we’ll be perfectly fine. Adam Frisch - UBS: Okay, and then, last question on this topic and then I’llmove on; if your top line did slow, and I’m assuming that if it did, it wouldbe sometime in fiscal ’09, given the way you guys normally conservatively giveyour guidance, how much would margin suffer, if at all? Or are there some plansin place where if your top line slowed, your profitability and EPS would not beimpacted? Gary C. Butler: Well, first of all, let’s talk about the markets that weserve. The core payroll business is growing 6% to 8%, just the market itself.And Beyond Payroll is growing double-digits in terms of the market. So we get liftbecause of the businesses that we are in and we are seeing no change in that,plus the international car markets in terms of vehicle sales are goinggangbusters, which we are benefiting from. And I don’t expect China to stopgrowing in terms of new vehicle sales in the same way with Eastern Europe andsome of the other growth opportunities for us. I think we are in pretty good shape as it relates to thosekind of issues. We obviously don’t give ’09 forecast, top or bottom, but aswe’ve shared with your previously, we have a lot of margin initiatives underwaythat will improve margins over time. So obviously that’s better if revenuegrowth is faster than it is if it is slower, but it’s still not going to changethe impact that those margin initiatives are going to bear fruit in the future. So whether we are growing 12% organically or 9% or 10%, weare still going to get great margin contribution over the next couple, threeyears. Adam Frisch - UBS: Okay, that’s great. And that line of questioning was more soto look at the other side of the argument in terms of the bears, but I thinkwe’ve pretty much covered that. One last question -- pays per control, you said every 1%decline is about $20 million in revenues. Is it a disproportionately highernumber for margins, considering that incremental paycheck is a higher marginthan the original? Gary C. Butler: Sure. I mean, it would be -- that margin is our highestmargin across the enterprise, so it would certainly be more of a drag than anew GlobalView sale in revenue, to use that example. Adam Frisch - UBS: Right, but how much -- if it’s $20 million in revenues, whatis it to operating margins? Gary C. Butler: We don’t go there. Adam Frisch - UBS: Okay. Christopher R. Reidy: But I would just clarify that generally, that metric, it’s$15 million just purely based on a change of pays per control. We say $20million because generally, there are other implications of that --participation of 401K plans, clients taking Beyond Payroll services, time andlabor management. So the $20 million is kind of an [all-in] with the otherramifications, just to be clear on that. Adam Frisch - UBS: Got it. Okay, thanks, guys. Good job.

Our next question comes from the line of David Grossman withThomas Weisel Partners. David Grossman -Thomas Weisel Partners: Thanks. Not to beat this pays per control issue, Gary, butmaybe if you just go back in time to the ’01 time period and I think duringthat period, the pays per control actually went negative, yet the payrollbusiness actually grew, maybe it bottomed at about 2% growth. Can you help us just maybe understand the dynamic betweenpricing, new sales, and pays per control and retention? And what combination offactors could allow you to sustain this mid-single to high single digit growthin payroll, even if the economy does start slowing down here over the next 12months or so? Gary C. Butler: If you go back in time to the ’02 periods, we did see someslightly negative growth in the 1% to 2% kind of range. We had a period of timewhere we were flat. The other thing that’s really I think helpful here is thatthe continued improvement and retention is helping us a lot. When you thinkabout a 50 basis point improvement in retention on $7 billion or $8 billion in recurringrevenue, it’s real money. So I would be much more pleased about an increase inretention than I would be worried about a one point drop in pays per control. And the single busiest metric we have around our growth isnew sales, and we are on our third year of consecutive, double-digit salesgrowth and it’s paying off in terms of the organic business growth that we areseeing in both dealer and in ES. Christopher R. Reidy: Just as a reminder to that point, the metric that we’vegiven on retention is a 1% change in retention is worth about $50 million ofrevenue. David Grossman -Thomas Weisel Partners: So is there any quick -- I know you’ve given us some greatrules of thumb here in terms of the individual metrics, but in terms of acombination of metrics, if we do see continued degradation in pays per control,the new sales one obviously is a difficult one to factor in here. Is thereanything you can help us with? We can obviously offset the -- Gary C. Butler: Well, you know, we’ve talked about 1% is worth $15 millionto $20 million in terms of revenue. Our new sales, the annual value of our newsales is roughly $1.2 billion. So continuing to grow new business at $1.2billion plus is far more important than whether or not we lose $15 million to $20million in further degradation and pays for control. So -- I mean, I guess anything is possible. If you wentnegative 5% growth, it certainly wouldn’t be a whole lot of fun but again,that’s not something that keeps my up at night. David Grossman - ThomasWeisel Partners: Okay, got it. And just on the margin side, you talked aboutthe data center consolidation, you talked about telesales and the smartshorting. Where are we in that effort, if you will? Are we 50% through theeffort? Are we 75%? Or is there still -- is this going to continue well intofiscal ’09? Christopher R. Reidy: I’d say on the data center consolidation, probably aroundhalfway there. And it is harder to say that on smart sharing because it’salmost continuous. We’ve got a significant number of people in India on anoff-shoring basis. We’ve opened up centers in El Paso and El Paso is pretty faralong, but we are now looking and expanding in Augusta. That will ultimatelyget up to about the same size, 1,000 to 1,500 people. So I think that’s acontinuous effort as we look at the complexion of our employee base and as wegrow, to grow in areas like El Paso and Augusta, or India. David Grossman -Thomas Weisel Partners: And just one last thing, actually, for you Chris; if Iunderstood you correctly on the last call, you had some cash outside the U.S.that if you could successfully repatriate it, you would apply that toincremental share repurchases. Can you perhaps just give us an update on wherewe are on that? Christopher R. Reidy: The best reference would be back to our 10-K, where weactually do talk about freeing up the APB 23 ruling on that, which we basicallytook the income tax expense, we covered it with foreign tax losses so that itreally wasn’t very dramatic. But in effect, that freed up a significant portionof the international cash and so when you look at our cash balances, other thanbasic working capital needs and some slight restricted cash, that the rest ofthat is pretty much free cash. So we’ve made progress on that and it’s nowavailable. Now, some of that will actually be repatriated. The timingof the repatriation will occur by the end of this calendar year for about halfof that and the balance into the second half of our fiscal year. David Grossman -Thomas Weisel Partners: And can you aggregate or quantify that for us? Christopher R. Reidy: I don’t want to pin ourselves down to a number but if youlook at it from another angle, we are probably -- the amount of cash that youwould expect to see on the balance sheet on the near-term could be as low as $1billion from the 1.5 that it is today. David Grossman -Thomas Weisel Partners: Thanks very much.

Our next question comes from the line of Elizabeth Grausamwith Goldman Sachs. Elizabeth Grausam -Goldman Sachs: Thank you. I first wanted to touch on the employer salesgrowth for the quarter, at 11%. This is over probably your toughest comparablein the first quarter of ’07, where you posted 16% growth. When you look at yourforecast now, which obviously is baking in a much more difficult macroeconomicconditions, do you think your new employer sales, employer services sales couldcome in stronger, given the start you had to the year? And is there a reasonwhy you aren’t increasing that expectation at this point in time? Gary C. Butler: Well, the performance in the first quarter is prettyconsistent with our plan for the first quarter, for both dealer and ES. Andeven the metrics that we see across the enterprise pretty much have themforecasting to continue to finish at a plan kind of level. So we just didn’twant to be too optimistic and try to raise that forecast, when that’s reallywhat the business units are telling us. Elizabeth Grausam -Goldman Sachs: And then the PEO expectations were firmed up, both on therevenue and the margin expectations. Could you just discuss a little bitfurther what you are seeing in that market in particular that’s giving yougreater confidence right now? Gary C. Butler: Well, we had a very strong quarter, obviously in bothrevenue and margin. We had a good sales result for the first quarter, and wesaid double digits in all of our business units. And the number of worksiteemployees, which was in the press release, was also quite strong. So in a full fiscal year, generally if you have a good firstquarter, you are going to have a good fiscal year. If you have a bad firstquarter, it’s obviously tougher to make up that ground in the service business.So we are feeling great about the results in the PEO. Elizabeth Grausam -Goldman Sachs: Great, and just lastly on the cash allocation, you’veobviously been a material repurchaser of your stock. You do tend to raise yourdividend in mid-November. I know it’s a board decision but can you give us anycolor on the process of making that decision and looking at your dividendgrowth relative to your earnings growth rate at this point in time? Gary C. Butler: Again, as you pointed out, I can’t speak for the board, butI would be quite surprised if they didn’t raise the dividend at least at thelevel of our EPS forecast or higher. Elizabeth Grausam -Goldman Sachs: Great. Thank you.

Our next question comes from the line of Charles Murphy withMorgan Stanley. Charles Murphy -Morgan Stanley: Thanks. Gary and Chris, I was wondering if you could isolatefor us the one or two key factors that led you to raise the employer servicesmargin forecast for ’08? Gary C. Butler: I think the thing that was the most important is they hadgreat margin performance in the first quarter and just like my commentsearlier, typically if you’ve got good margin performance in the first quarter,it should stay with you, at least if not the whole year, at least over a goodpart of the year. So that would be the single biggest thing that would cause meto go there. Charles Murphy -Morgan Stanley: And Chris, could you tell us what the diluted sharesoutstanding were on September 30th. Christopher R. Reidy: Sure. Hold on one second.

The diluted I believe --- well, no, the average is in thepress release. The actual balance, I don’t have right here. Obviously it willbe in the 10-Q. Charles Murphy -Morgan Stanley: Okay. Gary C. Butler: We probably have that here, Charlie. Just let us find it andwe’ll move on and we’ll come back to that once we get it. Charles Murphy -Morgan Stanley: Thanks very much.

Our next question will come from the line of Gary Bisbeewith Lehman Brothers. Gary Bisbee - LehmanBrothers: Good morning, and add my congratulations on a great quarter.I guess the first question, the retention continues to get better and I guessI’m wondering why. Is this still a case of as you cross-sell more things, thechallenges the customer has to replace that if they leave is getting -- thebarrier to exit is getting higher? Gary C. Butler: It’s really three things, Gary. One is I think our servicelevels are good and in some cases, they are great. And so clients, if you do agood job for them, tend to stay around a longer period of time. Secondly, our sales bundles, as well as our sales back intothe base have never been better, so in national accounts when we sign up a newaccount, they sign up literally for two to three products and it usuallyincludes hosting. If you go to major accounts, it’s a couple of products andthe PEO is a whole host of products, so clearly if you were to look at a clientwho was a payroll only client in major accounts and take that same group ofclients that had payroll, 401K, and time and labor management, that retentionrate would move up three or four percentage points because of the fact thatthey had multiple products. On top of that, large clients stay with us longer than smallclients. Obviously if you’re IKEA and you’re converting to ADP's payroll, ourGlobalView product in 20 countries for 80,000 employees, it’s highly unusual,unless you have a major problem, for that client not to stay around for 10 to15 years. So we are having great success with COS, GlobalView and thenour high-end of the marketplace, so the blended average will automatically geta lift, to the extent that we are able to grow those businesses even fasterthan our traditional markets. Gary Bisbee - LehmanBrothers: So if we assume that we continue to have a somewhat weakeremployment market in the U.S.and historically, I think at the small customer end, that would lead to morecompanies going out of business and hurting retention. Do you think that youcan still have retention gains, or at least I guess in the worst case, keep itflat year over year, even if you have a little weaker environment at the lowend? Gary C. Butler: I don’t remember exactly, but I think even in 2001 and 2002and we went into 2003, we didn’t see any real declines in our retention. It isharder to improve it, to your earlier point, but we really didn’t see anymaterial degradation in retention. Gary Bisbee - LehmanBrothers: Okay, and then the second question, on the PEO margin,obviously really strong year over year. Were there any one-time gains there orissues around the workers’ comp? Or is that just continued -- Gary C. Butler: It has nothing to do with workers’ comp, but it wasprimarily just an easy compare to the prior first quarter. Gary Bisbee - LehmanBrothers: Okay, and then lastly, do you have on hand what cash flowfrom operations and CapEx were in the quarter? Gary C. Butler: I think CapEx was around $30 million, $35 million. We were alittle behind our internal plans, so I think we are still forecasting in the175 to 200 kind of range. Christopher R. Reidy: Cash flow from operations was a little over 275. Gary Bisbee - LehmanBrothers: Great. Thanks a lot. Christopher R. Reidy: Just to be clear on the question that Charlie had asked, wehad 526 million shares outstanding at 9/30, about 7 million of dilution, soit’s about 533 to 544 diluted shares at September 30th.

Our next question comes from the line of Mark Marcon withBaird. Mark Marcon - RobertW. Baird & Co.: Good morning and I would like to add my congratulations to astrong quarter. With regard to looking at employer services, you had internalgrowth in ES of 9%. And I’m wondering -- can you break that down in terms oflooking at beyond payroll relative to core? Can you remind us what that splitis between the two? Gary C. Butler: The revenue split I think is about 60-40. Mark Marcon - RobertW. Baird & Co.: Is that worldwide or U.S.? Gary C. Butler: That’s more I think U.S., if I were guessing.

It’s all U.S. It’s actually, since we pulled the PEO out ofthat mix now, the payroll, payroll tax actually is up. It’s closer to 68%, 65%,66%, 68%, with 32% about in the Beyond Payroll. That’s of the U.S. revenues. Mark Marcon - RobertW. Baird & Co.: Thank you. Gary C. Butler: And that grew 18% this quarter, Mark. Mark Marcon - RobertW. Baird & Co.: And how much of that was internal in terms of the Beyond? Gary C. Butler: We don’t actually publish that. It’s not something we trackas much. In the Beyond Payroll, almost by definition it’s all internal becauseif you didn’t have [TLN] before -- well, it’s internal growth in the sense thatit’s a new product to an existing client, so it is internal growth. Mark Marcon - RobertW. Baird & Co.: I meant if we were stripping out VirtualEdge and Employeaseand things of that nature, just to get a sense for how it’s -- what the organicgrowth rates are as opposed to how much is being contributed by acquisitions. Gary C. Butler: Well, those acquisitions are growing like gangbusters, Mark.I mean, Employease and VirtualEdge are literally almost double in a 12-monthperiod of time, so -- Mark Marcon - RobertW. Baird & Co.: And that’s because of the cross-selling, right? And that’sbecause of the cross-selling that you’ve got? Gary C. Butler: Yeah, but again, it’s organic. If you’ve got $20 million andwe double it to $40 million, that incremental 20 counts as organic growth. Mark Marcon - RobertW. Baird & Co.: Got it. That makes sense. And then, with regard to themargin improvement, I was just trying to get to this again. I mean, how much ofit is a price increase in terms of across the board, how much of it is theon-shoring, near-shoring, smart sourcing, and how much of it is just theimprovement in terms of areas like COS, GlobalView, where you’ve been makinginvestments? And the real reason for the question is ultimately, whatdoes this portend for future margin expansion as we look out over the next twoto three years? It seems to me like you are still at the relatively earlystages in terms of optimizing. Christopher R. Reidy: Yeah, a couple of things. You started with price increases.I don’t think that’s where you want to go because price increases are about thesame as they were last year, so that’s not contributing to the marginimprovement. And really, we don’t break out the improvements in margin bythe items that we said because it’s almost impossible to tell. You know, yousee it in your results and you know it’s being driven by these initiatives, butthe lines blur. We have in the past, when we made the investments we neededto make in our sales force and in some of our new businesses in COS, inGlobalView, we paid that price last year and the year before in terms of marginsuppression, as well as some of the acquisitions that we did. All of those things, as you’ve said, you’re beginning to getsome leverage out of those acquisitions. So it’s all of those things combinedthat yield the improvements in the margin. You can’t really point to any one ofthe items and it’s impossible to break them down any further. Mark Marcon - RobertW. Baird & Co.: How far along are we? We are obviously looking at this yearbut we are also looking beyond, and so I guess what I’m trying to ascertain isto what degree could we count on continued margin improvement in ES based oncontinued maturation of COS and GlobalView combined with all of thecost-savings initiatives that you’ve got in place. Gary C. Butler: I think the way to think about it, you have to parkacquisitions to the side, but assuming no acquisitions, and if we can maintainanywhere close to double-digit revenue growth, I would be very disappointed ifwe didn’t grow at last a half a point of margin a year. Mark Marcon - RobertW. Baird & Co.: Great. And then finally, where do you think the -- you gavesome great color with regard to your rate assumptions. Where does that take youin terms of where you think the effective yield would be at the very end of theyear and last quarter of the year? And where do you think, if rates don’tchange above and beyond what you’ve already described, the effective yieldwould be for next year? Gary C. Butler: We have not gone to that level of detail and I’m not sure ifwe did, we would feel comfortable sharing that at this point. I think there is so much up in the air around what the fed isgoing to do. We did try to give you some color by looking at a full year ofFY08, if everything was at 4% in terms of fed funds rate, that would also implymedium intermediate term rates around 4.5 or 4.6, which is kind of where theyield curve is today. So we did try to give you our best guess on what wouldhappen if that had been in effect for the entire year, and then I think youjust kind of have to make your own assumptions and go from there.

Mark, think about it when we talked about where we thoughtthe full year would be, a little bit under the 4.5%, and the first quarter wasabout 4.6%, so to average out to the little under 4.5%, the fourth quarterwould have to be then below the 4.5% -- not significantly below, but it wouldgo a bit below that. Christopher R. Reidy: One point to remember is that as our investments mature, theembedded rates are around 4.15 and the new purchase rates that we see arearound 4.4 as well. Mark Marcon - RobertW. Baird & Co.: Terrific. Thank you. Gary C. Butler: Not that dramatic exiting this year. Mark Marcon - RobertW. Baird & Co.: Thank you. Very helpful.

Our next question comes from the line of Greg Smith withMerrill Lynch. Gregory Smith -Merrill Lynch: What’s your tax rate expectation for the full year? It was alittle bit lower than we thought and I think international is driving that, ifI’m correct. Christopher R. Reidy: Well, some of it’s international, some of it’s the impact ofour data center consolidation efforts, so we get some state tax benefits aswell. I would probably go back and say that on a reported basis,2007 was 37.1. When you adjust for spin expenses and brokerage, or whatever,you’d really put that at a 36.8 level on an apples-to-apples basis. This yearis 36.6, but that’s something misleading as well because of FIN-48, you nowtake the interest expense on tax liabilities and charge that to the tax line,so adjusting for that on an apples-to-apples basis, our effective tax ratewould be 35.9. The difference between the 36.8 and the 35.9, or just about100 basis points, is really coming from the data center consolidation efforts,a decrease in some of the foreign income tax rates, Spain, Germany and U.K., aswell as the optimization of some foreign NOLs. So bottom line, moving in the right direction. Gregory Smith -Merrill Lynch: Okay, great. And then, just in dealer, the growth rate topick up a little bit as we move through the year -- I guess the question is howmuch -- do you -- how good is your visibility right now in dealer? And what isthe sensitivity just to overall U.S.auto sales at this point? Gary C. Butler: Two questions there; first of all, our visibility at dealeris pretty good because typically, the average time to install at dealer is fiveto six months. We are sitting here at the end of September and we have ourbacklog in place today, plus we have a pretty good view of our forecast forsales for the second quarter, so I think our confidence level in dealer interms of the full-year forecast is pretty high. And the second part of your question was? Gregory Smith -Merrill Lynch: Just the sensitivity to U.S.auto sales for that business overall. Gary C. Butler: In general, there is obviously some sensitivity but U.S.auto sales have been kind of at a low ebb now for going on the second year, andwe had a great sales year last year. We started off strong in the firstquarter. Obviously it’s a little easier if auto sales are up, but auto sales inEurope and in the far east are going gangbusters, so for what little drag wemight have in the U.S., which we’ve seen for two years, we’re more than makingup for it on the international scene. Gregory Smith -Merrill Lynch: Okay, great. Thanks a lot.

Our next question comes from the line of Michael Baker withRaymond James. Michael Baker -Raymond James: Thank you. As the company emerged out of the last downturn,Art Weinbach indicated that the most meaningful lesson was to actually investmore in the business and leverage the platform, and it seems like that’s a viewthat you share. I was wondering if you could update us on your sales headcountgrowth expectations, and also what kind of benefit you are seeing in terms ofnew sales from your channel strategy using CPAs, et cetera? Gary C. Butler: A couple of things; one is, I agree with Art’s assessment. Ithink the error that we made last time was thinking we could save ourselvesthrough a year to 18 month period of the downturn. Obviously the downturnlasted more like two to three years than throughout the 18 months, and so Ithink we had some hindsight there that said maybe we would have done things alittle bit differently. Today, based on where we are, I am continuing to invest andgrow in the business because I’m really managing ADP for the five-year view,not just for the next year view. And if you are not bringing new products tothe marketplace and growing your distribution, you ultimately will get introuble. This year, we are going to add about 4% or 5% in terms ofheadcount growth in our traditional sales force, and that would be true acrossthe board. We’re adding a good bit more headcount there and telesales I thinkwere up more like 40% or 50% in telesales headcount. But you know, you aretalking hundreds of people, not thousands of people. And we are also focusing on getting better productivity fromthe ones that we hired over the last couple, three years, where we were hiringmore in the 8% to 10% in terms of headcount. So pretty much business as usual. As you can see, in COS we are getting -- we’ve gone throughthe point where we are not profitable in our COS business. It’s approaching$140 million, $150 million run-rate business, and the same thing will happenwith GlobalView but it won’t happen until ’09, which will help us on the marginside as well. Michael Baker -Raymond James: I was just wondering if you could comment on the benefitthat you are seeing from the channel, like using CPAs as referrals, or banks? Gary C. Butler: We are continuing to see good improvement in CPA sales. Ithink we are pretty excited about a new product that we’ve launched that’sdirected at allowing CPAs to wholesale our products. The new Internet platformthat we have is built off of the Microsoft Small Business Accounting platformthat we have, but it basically allows a CPA to remarket or wholesale ADPservices directly to their client base and then we are the second line ofservice, as opposed to the first line of service. So we’ve gotten real good initial reception from thatproduct launch and we are optimistic that it will pay some good rewards in theyear ahead. Michael Baker -Raymond James: Thanks for the update.

We have time for one final question; that comes from theline of Tien-tsin Huang with JP Morgan. Tien-tsin Huang - JPMorgan: Good morning. Thanks for all the disclosure and taking aconservative view on rates in your forecast. I just have a couple of follow-up questions; first onemployer services, client fund balance growth, I think you’ve got it down abit. Are you seeing any impact from higher client penetration in addition tothe macro issues you talked about, like wage inflation and lower bonuses, etcetera? Gary C. Butler: I’m not sure I follow your question. Tien-tsin Huang - JPMorgan: Well, I’m thinking with direct deposit, 401K and sort of thepenetration rates creeping higher, I’m wondering if you are starting to seemore of a normalization of growth in client fund balance? Gary C. Butler: Most of the client fund balance is driven through directdeposits, new clients and tax money movement, and also the ADP check, where weget four to five days worth of float on that instrument. Roughly in the mid and small end of the markets, 85%, 90% ofour clients sign up for those kinds of services when we sell the payroll, andwe’re not seeing any material difference there. In up market, it’s more like50% of the clients use it because the clients are more float sensitive,although we do do a lot of standalone tax in that market. But again, I think from your viewpoint, nothing materiallydifferent than what you’ve seen for the last year or to. Tien-tsin Huang - JPMorgan: Okay. Maybe if I just ask it a different way -- what’s yourlong-term view, Gary, on client fund balance growth absent any major macrochanges? Gary C. Butler: High single digits, because we typically add 5% to 8% newpayroll tax revenue in terms of adding new clients, and typically clients give4% to 5% merit increases, somewhere between 3% and 5%. So you add the twotogether, along with some of the other additional float products that we sell,and you get pretty much to that high single digits. Tien-tsin Huang - JPMorgan: Got it, thanks. And then in dealer, any change in the U.S.DMS market? We covered DealerTrack and it seems like they’ve had some earlysuccess there since they bough Arkona. Do you see any changes from that end orfrom UCS? Gary C. Butler: Well, we are doing very well in the marketplace againstrentals and UCS. We don’t get to a lot of detail and sharing competitive hooksby different competitors, but we are doing very well there. Our loss rate toArkona today is no different than it’s been a year ago, so I think surelyDealer tried buying them gives them some more financial stability, but thecompany and the product and the service levels and the breadth of the productthat they have hasn’t materially changed. So I think all things else beingequal, the dealers are still quite happy to be an ADP client. Tien-tsin Huang - JPMorgan: Okay. Good to know. Thanks a lot. Gary C. Butler: I don’t think we have any other calls in the queue, so weappreciate you being with us today and we are very pleased with our quarter andcontinue to be optimistic for a very strong forecast for ’08. Thanks for beingwith us. Christopher R. Reidy: Thank you.

This concludes today’s Automatic Data ProcessingIncorporated first quarter fiscal 2008 earnings conference call. Thank you forparticipating. You may now disconnect.