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Supplemental balance sheet information
 9 Months Ended
Sep. 30, 2018
Balance Sheet Related Disclosures [Abstract]  
Supplemental balance sheet information Supplemental balance sheet information

Allowance for uncollectible accounts – Changes in the allowance for uncollectible accounts for the nine months ended September 30, 2018 and 2017 was as follows:
 
 
Nine Months Ended
September 30,
(in thousands)
 
2018
 
2017
Balance, beginning of year
 
$
2,884

 
$
2,828

Bad debt expense
 
2,275

 
2,384

Write-offs, net of recoveries
 
(2,036
)
 
(2,404
)
Balance, end of period
 
$
3,123

 
$
2,808



Inventories and supplies – Inventories and supplies were comprised of the following:
(in thousands)
 
September 30,
2018
 
December 31,
2017
Raw materials
 
$
7,508

 
$
7,357

Semi-finished goods
 
7,942

 
7,635

Finished goods
 
25,343

 
24,146

Supplies
 
4,325

 
3,111

Inventories and supplies
 
$
45,118

 
$
42,249



Available-for-sale debt securities – Available-for-sale debt securities included within funds held for customers were comprised of the following:
 
 
September 30, 2018
(in thousands)
 
Cost
 
Gross unrealized gains
 
Gross unrealized losses
 
Fair value
Funds held for customers:(1)
 
 
 
 
 
 
 
 
Domestic money market fund
 
$
11,000

 
$
—

 
$
—

 
$
11,000

Canadian and provincial government securities
 
8,938

 
—

 
(541
)
 
8,397

Canadian guaranteed investment certificates
 
7,747

 
—

 
—

 
7,747

Available-for-sale debt securities
 
$
27,685

 
$
—

 
$
(541
)
 
$
27,144


(1) Funds held for customers, as reported on the consolidated balance sheet as of September 30, 2018, also included cash of $57,263.

 
 
December 31, 2017
(in thousands)
 
Cost
 
Gross unrealized gains
 
Gross unrealized losses
 
Fair value
Funds held for customers:(1)
 
 
 
 
 
 
 
 
Domestic money market fund
 
$
17,300

 
$
—

 
$
—

 
$
17,300

Canadian and provincial government securities
 
9,051

 
—

 
(393
)
 
8,658

Canadian guaranteed investment certificates
 
7,955

 
—

 
—

 
7,955

Available-for-sale debt securities
 
$
34,306

 
$
—

 
$
(393
)
 
$
33,913

 
(1) Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2017, also included cash of $52,279.
 
Expected maturities of available-for-sale debt securities as of September 30, 2018 were as follows:
(in thousands)
 
Fair value
Due in one year or less
 
$
20,863

Due in two to five years
 
4,308

Due in six to ten years
 
1,973

Available-for-sale debt securities
 
$
27,144



Further information regarding the fair value of available-for-sale debt securities can be found in Note 7.

Assets held for sale – Assets held for sale as of September 30, 2018 included a small business distributor and 3 small business customer lists. Assets held for sale as of December 31, 2017 included 2 providers of printed and promotional products, both of which were sold during 2018, and 2 small business distributors, 1 of which was sold during the first quarter of 2018. Also during the nine months ended September 30, 2018, we sold several small business customer lists that previously did not meet the requirements to be reported as assets held for sale in the consolidated balance sheets. We determined that the assets sold would be better positioned for long-term growth if they were managed by independent distributors. Subsequent to the sales, the businesses and customer lists are owned by distributors that are part of our Safeguard® distributor network. As such, our revenue is not impacted by these sales, and the impact to our costs is not significant. We entered into aggregate notes receivable of $28,028 in conjunction with these sales (non-cash investing activity), and we recognized aggregate net gains within SG&A expense of $1,765 during the quarter ended September 30, 2018 and $12,855 during the nine months ended September 30, 2018. During the quarter ended September 30, 2017, we sold the assets of 2 small business distributors and assets associated with certain custom printing activities. During the nine months ended September 30, 2017, we also sold a provider of printed and promotional products and an additional small business distributor. These sales resulted in aggregate net gains within SG&A expense of of $1,924 for the quarter ended September 30, 2017 and $8,703 for the nine months ended September 30, 2017.

During the first quarter of 2017, we recorded a pre-tax asset impairment charge of $5,296 related to a small business distributor that was sold during the second quarter of 2017. This impairment charge reduced the carrying value of the business to its estimated fair value less costs to sell, as we negotiated the sale of the business. During the second quarter of 2017, we recorded an additional pre-tax asset impairment charge of $2,954 as we finalized the sale of this business, resulting in a total pre-tax asset impairment charge of $8,250 for the nine months ended September 30, 2017.

The businesses sold during 2018, as well as those held for sale as of September 30, 2018, were included in our Small Business Services segment, and their net assets consisted primarily of intangible assets. We are actively marketing the remaining assets held for sale, and we expect the selling prices will equal or exceed their current carrying values. Net assets held for sale consisted of the following:
(in thousands)
 
September 30,
2018
 
December 31,
2017
 
Balance sheet caption
Current assets
 
$
—

 
$
4

 
Other current assets
Intangibles
 
3,250

 
8,459

 
Assets held for sale
Goodwill
 
—

 
3,566

 
Assets held for sale
Other non-current assets
 
—

 
207

 
Assets held for sale
Net assets held for sale
 
$
3,250

 
$
12,236

 
 

Intangibles – Intangibles were comprised of the following:
 
 
September 30, 2018
 
December 31, 2017
(in thousands)
 
Gross carrying amount
 
Accumulated amortization
 
Net carrying amount
 
Gross carrying amount
 
Accumulated amortization
 
Net carrying amount
Indefinite-lived intangibles:
 
 
 
 
 
 
 
 
 
 
 
 
Trade name(1)
 
$
—

 
$
—

 
$
—

 
$
19,100

 
$
—

 
$
19,100

Amortizable intangibles:
 
 

 
 

 
 

 
 

 
 

 
 

Internal-use software
 
391,747

 
(312,268
)
 
79,479

 
359,079

 
(284,074
)
 
75,005

Customer lists/relationships(2)
 
401,821

 
(159,667
)
 
242,154

 
343,589

 
(121,729
)
 
221,860

Trade names
 
49,872

 
(24,405
)
 
25,467

 
36,931

 
(19,936
)
 
16,995

Technology-based intangibles
 
39,000

 
(12,030
)
 
26,970

 
31,800

 
(6,400
)
 
25,400

Software to be sold
 
36,900

 
(14,374
)
 
22,526

 
36,900

 
(11,204
)
 
25,696

Other
 
1,800

 
(1,755
)
 
45

 
1,800

 
(1,590
)
 
210

Amortizable intangibles
 
921,140

 
(524,499
)

396,641


810,099


(444,933
)

365,166

Intangibles
 
$
921,140

 
$
(524,499
)

$
396,641


$
829,199


$
(444,933
)

$
384,266



(1) During the third quarter of 2018, we recorded a pre-tax asset impairment charge of $19,100 for our indefinite-lived trade name. Further information can be found in Note 7.

(2) During the first nine months of 2018, we recorded pre-tax asset impairment charges of $4,031 related to amortizable customer lists. Further information can be found in Note 7.

Amortization of intangibles was $28,505 for the quarter ended September 30, 2018, $27,456 for the quarter ended September 30, 2017, $84,199 for the nine months ended September 30, 2018 and $79,284 for the nine months ended September 30, 2017. Based on the intangibles in service as of September 30, 2018, estimated future amortization expense is as follows:
(in thousands)
 
Estimated
amortization
expense
Remainder of 2018
 
$
23,632

2019
 
94,468

2020
 
74,306

2021
 
57,593

2022
 
41,964



During the nine months ended September 30, 2018, we acquired internal-use software in the normal course of business. We also acquired intangible assets in conjunction with acquisitions (Note 6). The following intangible assets were acquired during the nine months ended September 30, 2018:
(in thousands)
 
Amount
 
Weighted-average amortization period
(in years)
Customer lists/relationships(1)
 
$
75,775

 
8
Internal-use software
 
33,223

 
3
Trade names
 
13,700

 
7
Technology-based intangibles
 
7,200

 
5
Acquired intangibles
 
$
129,898

 
6


(1) Includes customer list purchases of $1,188 that did not qualify as business combinations.

Information regarding acquired intangibles does not include measurement-period adjustments recorded during the nine months ended September 30, 2018 for changes in the estimated fair values of intangibles acquired during 2017 through acquisitions. Information regarding these adjustments can be found in Note 6.

Goodwill – Changes in goodwill during the nine months ended September 30, 2018 were as follows:
(in thousands)
 
Small
Business
Services
 
Financial
Services
 
Direct
Checks
 
Total
Balance, December 31, 2017:
 
 
 
 
 
 
 
 
Goodwill, gross
 
$
706,568

 
$
324,239

 
$
148,506

 
$
1,179,313

Accumulated impairment charges
 
(48,379
)
 
—

 
—

 
(48,379
)
Goodwill, net of accumulated impairment charges
 
658,189

 
324,239


148,506


1,130,934

Impairment charge (Note 7)
 
(78,188
)
 
—

 
—

 
(78,188
)
Goodwill resulting from acquisitions
 
41,216

 
29,304

 
—

 
70,520

Measurement-period adjustments for prior year acquisitions (Note 6)
 
1,420

 
2,764

 
—

 
4,184

Adjustment of assets held for sale
 
635

 
—

 
—

 
635

Currency translation adjustment
 
(2,131
)
 
—

 
—

 
(2,131
)
Balance, September 30, 2018:
 
 

 
 

 
 

 
 

Goodwill, gross
 
747,708

 
356,307

 
148,506

 
1,252,521

Accumulated impairment charges
 
(126,567
)
 
—

 
—

 
(126,567
)
Goodwill, net of accumulated impairment charges
 
$
621,141

 
$
356,307


$
148,506


$
1,125,954


Other non-current assets – Other non-current assets were comprised of the following:
(in thousands)
 
September 30,
2018
 
December 31,
2017
Loans and notes receivable from Safeguard distributors
 
$
71,728

 
$
44,276

Prepaid product discounts(1)
 
58,539

 
63,895

Postretirement benefit plan asset
 
45,435

 
39,849

Deferred sales commissions(2)
 
7,037

 
—

Deferred advertising costs
 
5,089

 
6,135

Other
 
7,719

 
5,601

Other non-current assets
 
$
195,547

 
$
159,756



(1) In our prior year financial statements, we referred to this asset as contract acquisition costs.

(2) Net of amortization of $2,033 for the nine months ended September 30, 2018.

Changes in prepaid product discounts during the nine months ended September 30, 2018 and 2017 were as follows:
 
 
Nine Months Ended
September 30,
(in thousands)
 
2018
 
2017
Balance, beginning of year
 
$
63,895

 
$
65,792

Additions(1)
 
11,695

 
15,651

Amortization
 
(16,976
)
 
(14,685
)
Other
 
(75
)
 
(127
)
Balance, end of period
 
$
58,539

 
$
66,631

 
(1) Prepaid product discounts are generally accrued upon contract execution. Cash payments made for prepaid product discounts were $19,125 for the nine months ended September 30, 2018 and $20,003 for the nine months ended September 30, 2017.

Accrued liabilities – Accrued liabilities were comprised of the following:
(in thousands)
 
September 30,
2018
 
December 31,
2017
Funds held for customers
 
$
83,370

 
$
85,091

Deferred revenue
 
39,939

 
47,021

Employee profit sharing/cash bonus
 
25,868

 
31,312

Prepaid product discounts due within one year(1)
 
10,596

 
11,670

Customer rebates
 
9,887

 
11,508

Acquisition-related liabilities(2)
 
6,734

 
23,878

Restructuring due within one year (Note 8)
 
4,719

 
4,380

Income tax
 
2,146

 
17,827

Other
 
51,270

 
44,566

Accrued liabilities
 
$
234,529

 
$
277,253



(1) In our prior year financial statements, we referred to this liability as contract acquisition costs due within one year.

(2) Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 7.

Other non-current liabilities – Other non-current liabilities were comprised of the following:
(in thousands)
 
September 30,
2018
 
December 31,
2017
Prepaid product discounts(1)
 
$
15,229

 
$
21,658

Other
 
27,101

 
30,583

Other non-current liabilities
 
$
42,330

 
$
52,241


(1) In our prior year financial statements, we referred to this liability as contract acquisition costs.