Welcome to the CBIZ third quarter 2010 results conference call. My name is Monica and I will be your operator for today’s call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session. Please note that this conference is being recorded. I will now turn the call over to Mr. Steven Gerard. Mr. Gerard, you may begin.

Thank you, Monica and good morning everyone and thank you for calling into CBIZ’s third quarter 2010 conference call. Before I begin with my comments, I’d like to remind you of a few things. As with all of our conference calls, this call is intended to answer the questions of our shareholders and analysts. If there are media representatives on the call, you’re welcome to listen in; however, I ask that if you have questions you hold them until after the call and we’ll be happy to address them at that time. The call is also being webcast and you can access the call over our website. You should have all received a copy of the press release which we issued this morning. If you did not, you can access that on our website or call our corporate office for a copy. Finally please remember, that during the course of the call, we may make forward-looking statements. These statements represent management’s intentions, hopes, beliefs, expectations, and predictions of the future. Actual results can and sometimes do differ materially from those projected in forward-looking statements. Additional information concerning the factors which could cause actual results to differ materially from those in forward-looking statements is contained in our SEC filings, Form 10-K and press releases. Joining me on the call this morning is Jerry Grisko, our President and Chief Operating Officer and Ware Grove, our Chief Financial Officer. Prior to the opening this morning, we were pleased to release our third quarter results. The third quarter which is typically a slow quarter for us was a very strong quarter in 2010 with relatively flat revenue earnings per share actually from operations were $0.11 versus $0.09 after you discount the $0.02 charge from the early retirement of debt. We saw a strong operating performance from our financial services and employee services group and good cost control measures implemented in our MMP group. The third quarter also saw a significant number of other activities including the replacement of $130 million of convertible notes to eliminate any refinancing risk for next year when our old notes retire, and in the third quarter we resolve the possible all the issue overhang issue which has been frequently mentioned to us resulting from the shares owned by our founder Mike DeGroote with the purchase of half of these shares and option for the balance. A combination of the share purchases Mr. DeGroote and the shares purchased in connection with the convert will be highly accretive to our shareholders next year. At this point, I would like to turn it to Ware to go through the details and then I will come back with more comments on what’s going on in the market.

Thank you, Steve and good morning everyone. We had a lot of significant events that occurred in the third quarter and I want to run through the highlights of these items with you. Let me start by reminding everyone that 2009 results are restated for the impact of discounted operations that occurred in the fourth quarter of 2009. Now beyond the refinancing and share repurchase transactions that we announced in September, I believe it is most important to note the continued good performance of both our financial services and employee services business groups. We continue to operate in an uncertain economic environment. But as you look at our results, you will see that thanks to the hard work of the many people within our business units located across the United States both of these groups have increased their pre-tax income contributions and have improved our gross margins for the third quarter and for the nine months ended September 30, 2010. Total revenue in the third quarter grew from a $175.8 million a year ago to $176.5 million in the third quarter of this year. Same unit revenue for CBIZ in the third quarter declined by 2.2% or by $3.8 million compared with the third quarter a year ago. A majority of this decline could be attributed to the medical management professionals group. We are seeing unit revenue declined by 8.1% or by $3.3 million in the third quarter. Same year the revenue in our financial services group was essentially flat or declined by four tens of 1% and in our employee services group same unit revenue again was essentially or decline by six tenth of a percent in the third quarter compared with a year ago. Now for the nine months ended September 2010 same unit revenue for CBIZ declined…

Thank you, Ware. We covered a lot of information in a relatively short period of time. I would like to open it up for questions. I want to reiterate that the acquisition pipeline remains very strong we are confident that we will complete the normal three to six transactions we do each year and any of those that might come obviously would come between now and year end. With respect to the transaction with the group interest that was an issue which has been our radar for quite sometime and opportunity came up to resolve an issue that we knew would result someday and I believe a very fair transaction has been entered into for both the company and for the DeGroote interests. And I would remind our listeners that Mr. DeGroote today remains the largest single shareholder with almost 15% of our shares. With that let me stop and take questions of our shareholders and analyst and then return at the end.

Thank you. We will now begin the question-and-answer session. (Operator Instructions). Our first question comes from Josh Vogel of Sidoti & Company. Please go ahead. Josh Vogel - Sidoti & Company: Just a couple of questions here. I guess at first in financial services I know that historically especially through recession you see project based work start to fill the channel in the year that obviously was into around in late ’08 and ’09 but I was wondering if you are starting to see project based demands start to fill up today?

I think in the second quarter I commented that we were seeing glimmers of light on the horizon but it was too early to victory I don’t think its dramatically changed from that, we are seeing higher levels of interest in RRFPs more activity in terms of preliminary stage but nothing that I could at this point say yes, we have returned to the good old days of stronger project work in the third and fourth quarter? Josh Vogel - Sidoti & Company: Okay. And also I am not sure if you have seen or not but we are seeing some nice demand pick up from staffing companies that place financial services professionals on a temp basis. I am curious here, are you possibly losing and some opportunities or are you seeing some of your clients looking to go the way of the temp or is it just different work that they do all together?

I am not aware of that we are seeing any significant loss of business due to people being placed by temp agencies. The temp agencies are a good barometer I think of what small business owners are thinking about they are not ready to hire but they may be adding some more people on a temporary basis. But those people are not typically people that would do that work we do anyway. When you are talking about tax work and financial planning work and stuff, may be temps to part of it. But they typically look to their account for that. So I don’t think at that point that’s having a negative impact on us and anywhere. Josh Vogel - Sidoti & Company: Now in MMP I know you took some cost cutting maneuvers, I was wondering if may be you could explain what may be some expenses you are actually called out here and also margins were still a lot stronger there than what I expected and I was curious may be some radiology work pick back up or not. I was curious if you can give us some thoughts there?

The primary problem in MMP has been the revenue decline which has been driven by lower level of procedures and then within the procedures that were done on a much lower level of the high modality, the high payment procedures. The reaction was an aggressive program to make sure we have right sized each of our units. We were off-shoring as much as we could where there was a pick up in margin. We have implemented new processing systems in certain locations which should make us more efficient. So it’s really a combination of all of the actions because MMP has over 70 locations, some of which are quite small and some are large processing centers, the action plan in each one by definition just has to be different. In addition, we have four different specialties and while radiology has been the primary issue with respect to volume and price, actually the number of procedures and emergency is actually up a little bit. So it’s not something where I can just give you a one answer with one call. I think the cost cutting and the right sizing and the all of the activities that can contribute to a better performance or as the performance that they have today. We are still not back to the margins we saw historically and our game plan is to get the organization at least back to where they were and then hopefully on an upward swing. Josh Vogel - Sidoti & Company: And lastly if you remind me, I know I notice Employee Services was down a little bit sequentially, is that just seasonality.

Hi, Josh. This is Ware. There is a little bit of seasonality build into this business related to some of the carrier payments that we get that are typically received and recorded in the first half versus the second half that’s essentially most of the other business are pretty steady state throughout the balance of the year.

Your next question comes from Jim Macdonald of First Analysis. Please go ahead.

I just want to clarify see your $0.52 guidance does that count this quarter as $0.11 or $0.09?

Well, the $0.52 guidance just to be clear does exclude the two items that we talked about the debt retirement cost and the restructuring cost on the acquisition?

So it counts this quarter as an $0.11?

Well if you take the $0.02 on the debt retirement cost you can get from nine to 11, yes.

So that sort of implies not much profit next quarter, is that accurate?

No, here is the dilemma and the dilemma is that we have been saying in a range of 52. Initially that range has some downside to it and perhaps some upside, its looking like we are in a range of 52 with more optimism on the upside than the downside, but its too early to give anything more specific than that, a lots going to depend what we do in the next 30 to 40 days. So what we basically did was we reiterated prior guidance with a tilt on the upside rather than the original (inaudible) which could have been on the downside.

Okay and the legal recovery in the quarter how much was that and that’s subtracted out of G&A or something.

Yes, Jim that was about a $1 million and the asset was subtracted out G&A for the quarter and of course for the nine months. For the nine months it’s more of a normal run rate I think that’s the way to look at it.

Yes and I think that’s an important point. When we announced the first quarter, we said look right G&A is higher because of unusual legal expenses that we thought was more of a timing issue, and I don’t know how many people really believe but we were confident in it and that’s all this has been. We spend some money, we got the money back. So the way to look at our expense is really is much more to year-to-date basis.

Okay and those I just want to be clear of those I think we included those and left those in kind of an ongoing numbers and presumably you will leave this benefit in for the $0.l1, just thinking about it?

That is correct. The only exceptions are the two I imagined.

So your same store sales are still sort of negative and of course a big part of MMP but when can you see I mean do you expect to go same store negative next year?

We are just now in the beginnings of our budget process for next year. Its too early to call, I am expecting that the markets that we are in are going to be stable next year as opposed to digging out of the markets for the last 18 months. So but we will give guidance at the next call when we give our year end numbers, we will have our plans done by then. But I am certainly hopeful that we will see growth in our business is next year.

If you don’t mind come back in later. Financial services was it basically was sort of negative I would say in terms of your commentary but the number was stronger than I was looking for. Any positive reasons for the relative strength in financial services this quarter?

Well, first of all I don’t mean my comments to be negative the question that was asked was are we seeing any significant pick up in the project related work which affects the third and fourth quarter and my comment was there seems to be more activity but it hasn’t turned yet into business. I think of the primary reason for the improvement in financial services on revenue line was the acquisition that we made in the beginning of the year of the Goldstein Lewin firm in Florida and that accounts from most of the revenue pick up on a year-to-date basis.

Yes, though I mean it went from minus 5.5% same store last year to minus 0.4% this quarter. So, I know its still down.

Jim, we are clearly heading in the right direction and we are heading in the right direction, actually in all three of our businesses, given the somewhat lumpiness that comes in third quarter and fourth quarter financial services. Again, I think its too early to call victory I just think that each of our businesses are performing well given the environment they are in and we are in fact heading in the right direction. If you look at the MMP numbers sequentially quarter-over-quarter the negative drag on the procedure is getting better each quarter, and the actual negative procedure account on the same store basis in MMP for example is 1.5% from 1.2%. So each business is heading correctly and I think we had a better view of next year as we get to the end of this year.

(Operator Instructions). Our next question comes from Robert Kirkpatrick of Cardinal Capital Partners.

Can you talk a little bit about kind of the M&A market and whether there is a rush for the gates to beat anything on a tax basis by the end of the year?

Our M&A pipeline is very strong as I said before we will do the usual number of transactions that we do and I don’t believe there is a rush to the door because people are worried about capital gains. From time-to-time it’s mentioned but we are not seeing any more than we normally see. We just have a very full pipeline of deals we can do. Typically when these issues comes up and couple of years ago also there is always the thought that people will be rushing but it never actually happened and it hasn’t happened yet this year.

And Steve could you comment generally on what you are seeing in the economy. I mean given that CBIZ pushes so much in terms of small and medium businesses, I would curious as to your comments on that?

We are seeing stability but a continued deal of uncertainty as to the possible impact of healthcare and the possible impact of tax changes and the possible impact of an energy build and uncertainty as to what’s going to happen next week in the elections. So I think our clients are stable, I think they are looking more positive, they are looking up instead of down which is good news for us and good news for the economy. But again I think it’s too early to say that they are pulling the trigger, we are not seeing in the employment numbers, you are seeing in any kind of capital spending numbers or information that we get with respect to what our clients are thinking of. So they are stable, they are looking more positive, they are waiting for some degree of clarity as to what next year is going to look to them from external things, they can’t control such as taxes. So, slightly better but I wouldn’t call it in the good column yet.

Okay. And each of the last couple of quarters you commented on how healthcare reform could affect CBIZ’s business, any further comments on CBIZ?

Nothing with respect to the MMP business. I think the one thing that has come up last week was the discussion by the insurance commissioners of the United States to recommend to help in human services, they package which defined what was in, what they call the medical loss ratio, the MLR and included in that was the exclusion of broker commissions from the calculation, you may remember that the government has set certain medical loss ratio hurdles of the amount of money that they have to pay out on claims and whether you are a large group or small group and the exclusion of broker commissions in the calculation has raised the question as to what carriers are going to do with broker commission. The best read we have now is and I think I commented on this in the past as we believe we expected the rules to come out the way they appear to be coming out. We believe that the carriers will look hard at protecting and encouraging and enticing their major brokers of which we are with most of our carriers and we will probably change the commission structure for brokers that are not as important to them, are not primary brokers but all of that still has to be played out. So, nothing new with respect to reimbursements at this point on the MMT side, but a few other issues and that popped up on the group health side.

Okay and then a couple for Ware. Ware bad debt expense in the quarter was about a $1 million again?

We are accruing in the quarter about 75 basis points against revenue. Year-to-date its between 60 and 65 basis points which is historically where we are at on a collected basis foresee this.

And then the non-cash interest expense on the new debt should be in dollar terms about equal to that or the old debts lower rates but a higher principal amount is that assessment?

Yes, without getting in all that math, it will be the difference between the [four and seven] in the 7.5% rate. We can kind of the math and come up with a pretty close approximation.

(Operator Instructions). Our next question comes from Ted Hillenmeyer of Northstar Partners.

Ware can you give us with the share count you expect to have in Q4, because I don’t think the benefit of some of those buybacks affected for the entire quarter in Q3?

Yes, you are right Ted. There wasn’t much impact in the third quarter and year to date. In the fourth quarter I think that the share count is going to be close to 50 million shares and then for the full year, that will make the weighted average share count about 58.5 million shares for this year.

And it will remain at that 50 million basically for 2011 unless you take out the other two shares?

Yes that’s our projection right now. We expect appropriately 50 million shares in 2011.

And then I missed Steve I think you mentioned MMPs did you say it was a same store rate that was down 1.5% to 2% in the estimate?

Yes, Ted that was the procedure account for the what we call the mature clients which tend to be the clients that lap year-over-year. So what we are seeing is a still a decline in procedures but the declining rates appear to be less, we have also seen in the last couple of months a slight up tick in the higher modality procedures but again we are still running negative certainly this year or the last year.

So the difference between 1.5% to 2% in the same store sales rate down 8% is the pricing of those procedures or also loss of customers?

It’s a combination. The revenue was a combination of lower pricing and the net between lost and new accounts. But that’s right. I reported in the last two calls that 2009 was the first year in MMP’s history where the dollar amount of new business did not exceed the dollar amount of loss business and that was because we lost most of the business due to the doctor group withstanding or losing their contracts or other things happening with them. And because of the uncertainty around the federal governments healthcare people weren’t making changes. So we are carrying through 2010 the negative delta between the new business and lost business from last year.

And when you go to Q4 in 2011 do you know what the expectation is just for the number of customers year-over-year?

I am sorry 2010 or 2011?

Q4 2010 and into 2011. Is there a point where you lap the lost of these customers?

Well, sure and as Ware pointed out earlier this year the number of new customers, the dollar revenue from new customers exceed the dollar revenue from lost customers. So we do expect as we go into next year to lap last year’s problem.

And then I think lastly can you just give me an update expected payments for earns out?

Earns out, this year running roughly $20 million were essentially through those. For next year we scheduled and this is assuming full payment on all earn outs. Approximately $28 million in 2012 its approximately $22 million later drops off after that in 2013 of approximately $4 million.

(Operator Instructions). We have a follow-up from Jim MacDonald of First Analysis.

Yes, just a follow-up on the MMP questions. What are you looking at for the pricing environment for procedures for next year any other changes to downside or?

We continue this is an industry that will continue to have competitive pricing pressure. Again, we are too soon and our budget process to have a view on next year. So that’s the internal view. There has been no serious announcements by anybody on reimbursement rates for next year and I think that’s probably the direction of your question. We haven’t seen anything official from the committee that advices Medicare, Medicaid we haven’t seen and they haven’t come out with anything and we don’t have any feedback from carriers at this point that there are dramatic changes. That information tends to roll out when it comes. That information tends to roll out between now and year-end and in some years it actually comes out after year-end on a retroactive basis. And again, part of this is going to depend on what congress is prepared to do with recommendations as they’re handed off. So, there has been no news and no change on that.

In terms of the pricing issue, how much would you say is reduced reimbursement rates from the government versus competition, versus a mix to lower cost procedures?

I think I would be guessing off the top and I think we have more of that information. If it’s odd with you, why don’t we do a little bit better look at it and provide that to you. I’ve got rough numbers, but I don’t want to mislead you in it.

Just a couple other cleanup items, the receivables looked a bit high this quarter, any thoughts there?

Yes, we are watching them carefully as we always do. Our DSOs have slipped backwards a little bit, this year. We are looking at our collection activities. We are looking at our bad debt accruals as we had talked about earlier. We think we are fine, but we are continuing to manage it carefully. Steve I review it, all of the key outstanding balances with each practice group. The important thing is, our cash flow continues to be good, and while you can say that there is some slippage on the receipt side because of the DSO increase, we are managing the cost side very carefully too. So, we are kind of where we thought we would be in terms of net operating cash flow at this point this year.

And could you give me any update or tell us when we might get an update on MHM lawsuit?

There has been no significant change from the information we reported in the Q that came out this summer. There’s the usual legal wrangling and motions filed and things going in and out, but no material change in the status of that suit.

And do you expect anything to happen in the near term?

I am hopeful that we will prevail as we move forward, but I have learned the hard way that these things take much, much longer than they should. So I don’t have a view as to when we will have more clarity. These things are just agonizingly slow.

(Operator Instruction). We have no further questions in queue. Would you like to make any closing remarks?

Yes. Thank you. I would like to thank everyone who called in. I specifically and particularly like to thank all of our associates who listen into these calls. These have been difficult quarters. The results we posted today are strong, and they are strong because of the hard work and the dedication and the commitment that all of you have. So I really want to again thank you for your contributions to these results and for everyone else. We look forward to speaking to you when we release full year numbers after the end of the year. Thank you all very much.

Thank you ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may now disconnect.