Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2020

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows:


	As of June 30, 2020
(in thousands)	Level 1		Level 2		Level 3		Total
Assets
Money market investments ⁽¹⁾	$	—	$	178,536	$	—	$	178,536
Marketable equity securities ⁽²⁾	431,808		—		—		431,808
Other current investments ⁽³⁾	11,709		1,225		—		12,934
Total Financial Assets	$	443,517	$	179,761	$	—	$	623,278
Liabilities
Deferred compensation plan liabilities ⁽⁴⁾	$	—	$	26,907	$	—	$	26,907
Interest rate swap ⁽⁵⁾	—		2,782		—		2,782
Mandatorily redeemable noncontrolling interest ⁽⁶⁾	—		—		829		829
Total Financial Liabilities	$	—	$	29,689	$	829	$	30,518


	As of December 31, 2019
(in thousands)	Level 1		Level 2		Level 3		Total
Assets
Money market investments ⁽¹⁾	$	—	$	45,150	$	—	$	45,150

Marketable equity securities ⁽²⁾	585,080		—		—		585,080
Other current investments ⁽³⁾	8,843		6,044		—		14,887
Interest rate swap⁽⁷⁾	—		131		—		131
Total Financial Assets	$	593,923	$	51,325	$	—	$	645,248
Liabilities
Deferred compensation plan liabilities ⁽⁴⁾	$	—	$	34,674	$	—	$	34,674
Interest rate swap ⁽⁵⁾	—		1,119		—		1,119
Foreign exchange swap ⁽⁸⁾	—		273		—		273
Mandatorily redeemable noncontrolling interest ⁽⁶⁾	—		—		829		829
Total Financial Liabilities	$	—	$	36,066	$	829	$	36,895

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(1) The Company’s money market investments are included in cash and cash equivalents and the value considers the liquidity of the counterparty.

(2) The Company’s investments in marketable equity securities are held in common shares of U.S. and Canadian corporations that are actively traded on U.S. and Canadian stock exchanges. Price quotes for these shares are readily available.

(3) Includes U.S. Government Securities, corporate bonds, mutual funds and time deposits. These investments are valued using a market approach based on the quoted market prices of the security or inputs that include quoted market prices for similar instruments and are classified as either Level 1 or Level 2 in the fair value hierarchy.

(4) Includes Graham Holdings Company’s Deferred Compensation Plan and supplemental savings plan benefits under the Graham Holdings Company’s Supplemental Executive Retirement Plan, which are included in accrued compensation and related benefits. These plans measure the market value of a participant’s balance in a notional investment account that is comprised primarily of mutual funds, which are based on observable market prices. However, since the deferred compensation obligations are not exchanged in an active market, they are classified as Level 2 in the fair value hierarchy. Realized and unrealized gains (losses) on deferred compensation are included in operating income.

(5) Included in Other Liabilities. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates.

(6) The fair value of the mandatorily redeemable noncontrolling interest is based on the fair value of the underlying subsidiaries owned by GHC One (see Note 2), after taking into account any debt and other noncontrolling interests of its subsidiary investments. The fair value of the owned subsidiaries is determined by reference to either a discounted cash flow or EBITDA multiple, which approximates fair value.

(7) Included in Other current assets. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates.

(8) Included in Accounts payable and accrued liabilities, and valued based on a valuation model that calculates the differential between the contract price and the market-based forward rate.