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Fair Value Measurements (Tables)
 3 Months Ended
Mar. 31, 2021
Fair Value Disclosures [Abstract]  
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 March 31, 2021
(in thousands)Level 1Level 2Level 3Total
Assets      
Money market investments (1) 
$— $175,200 $— $175,200 
Marketable equity securities (2)
700,352 — — 700,352 
Other current investments (3)
10,121 5,107 — 15,228 
Total Financial Assets
$710,473 $180,307 $— $890,780 
Liabilities
  
  
  
Deferred compensation plan liabilities (4) 
$— $29,442 $— $29,442 
Contingent consideration liabilities (5)
— — 35,822 35,822 
Interest rate swap (6) 
— 1,720 — 1,720 
Mandatorily redeemable noncontrolling interest (7)
— — 10,272 10,272 
Total Financial Liabilities
$— $31,162 $46,094 $77,256 

As of December 31, 2020
(in thousands)Level 1Level 2Level 3Total
Assets
  
  

  
Money market investments (1) 
$— $268,841 $— $268,841 
Marketable equity securities (2)
573,102 — — 573,102 
Other current investments (3)
10,397 4,083 — 14,480 
Total Financial Assets
$583,499 $272,924 $— $856,423 
Liabilities
  
  

  
Deferred compensation plan liabilities (4) 
$— $31,178 $— $31,178 
Contingent consideration liabilities (5)
— — 37,174 37,174 
Interest rate swap (6) 
— 2,342 — 2,342 
Foreign exchange swap (8)
— 259 — 259 
Mandatorily redeemable noncontrolling interest (7)
— — 9,240 9,240 
Total Financial Liabilities
$— $33,779 $46,414 $80,193 
____________
(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 Accounts payable and accrued liabilities and Other Liabilities. The Company determined the fair value of the contingent consideration liabilities using a Monte Carlo simulation as of the acquisition dates, which included using estimated financial projections for the acquired businesses.
(6)
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.
(7)
The fair value of the mandatorily redeemable noncontrolling interest is based on the fair value of the underlying subsidiaries owned by GHC One, 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.
(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.
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation
The following table provides a reconciliation of changes in the Company’s financial liabilities measured at fair value on a recurring basis, using Level 3 inputs:
(in thousands)Contingent consideration liabilitiesMandatorily redeemable noncontrolling interest
As of December 31, 2020
$37,174 $9,240 
Changes in fair value$— $1,051 
Accretion of value included in net income$606 $— 
Settlements or distributions$(1,849)$(19)
Foreign currency exchange rate changes$(109)$— 
As of March 31, 2021
$35,822 $10,272