Additional Balance Sheet and Cash Flow Information

6 Months Ended

Jun. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Additional Balance Sheet and Cash Flow Information

Investments in Marketable Securities

The Company’s marketable securities consisted of the following (in thousands):



	June 30, 2019		December 31, 2018		July 1, 2018
Debt securities	$	—	$	10,007	$	—
Mutual funds	51,543		44,243		49,537
Total marketable securities	$	51,543	$	54,250	$	49,537

Debt securities, which were included in Marketable securities on the consolidated balance sheets, were carried at fair value with unrealized gains or losses reported in other comprehensive income. Mutual fund investments, which are included in Other long-term assets on the consolidated balance sheets, are carried at fair value with gains and losses recorded in net income. The mutual fund investments are held to support certain deferred compensation obligations.

Inventories

Substantially all inventories located in the United States are valued using the last-in, first-out (LIFO) method. Other inventories are valued at the lower of cost or net realizable value using the first-in, first-out (FIFO) method. Inventories consisted of the following (in thousands):



	June 30, 2019			December 31, 2018			July 1, 2018
Raw materials and work in process	$	161,828		$	177,110		$	154,921
Motorcycle finished goods	218,069			301,630			222,711
Parts & accessories and general merchandise	149,352			136,027			140,096
Inventory at lower of FIFO cost or net realizable value	529,249			614,767			517,728
Excess of FIFO over LIFO cost	(58,639		)	(58,639		)	(52,355		)
Total inventories, net	$	470,610		$	556,128		$	465,373

Operating Cash Flow

The reconciliation of net income to net cash provided by operating activities is as follows (in thousands):



	Six months ended
	June 30, 2019			July 1, 2018
Cash flows from operating activities:
Net income	$	323,576		$	417,101
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of intangibles	125,386			130,061
Amortization of deferred loan origination costs	38,036			39,396
Amortization of financing origination fees	4,522			4,133
Provision for long-term employee benefits	6,936			18,954
Employee benefit plan contributions and payments	(3,637		)	(6,422		)
Stock compensation expense	17,285			19,081
Net change in wholesale finance receivables related to sales	(167,594		)	(171,195		)
Provision for credit losses	60,874			48,932
Deferred income taxes	5,368			1,515
Other, net	(10,477		)	20,894
Changes in current assets and liabilities:
Accounts receivable, net	(17,592		)	(14,882		)
Finance receivables - accrued interest and other	(4,963		)	4,228
Inventories	88,146			63,957
Accounts payable and accrued liabilities	34,370			161,101
Derivative instruments	4,352			(136		)
Other	(8,356		)	(859		)
Total adjustments	172,656			318,758
Net cash provided by operating activities	$	496,232		$	735,859