EMPLOYEE BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2013

Description of New Accounting Pronouncements Recently Adopted

Schedule of funded status of the Plans

The funded status of the Plans and the net amount recognized in the statement of financial position are summarized as follows as of:

December 31,	2013			2012
(in thousands)
CHANGE IN ACCUMULATED BENEFIT OBLIGATION
Accumulated Benefit obligation at beginning of year	$	210,815		$	196,911
Service cost		112			100
Interest cost		8,551			9,622
Actuarial (gain) loss		(24,724	)		21,541
Benefits paid		(8,807	)		(17,359	)
Accumulated Benefit obligation at end of year		185,947			210,815
CHANGE IN PLAN ASSETS
Market value of plan assets at beginning of year		167,544			165,044
Actual return on plan assets		28,632			14,656
Employer contribution		5,000			5,203
Benefits paid		(8,807	)		(17,359	)
Fair value of plan assets at end of year		192,369			167,544
Funded status	$	6,422		$	(43,271	)

Schedule of amounts recognized in the statement of financial position

Amounts Recognized in the Statement of Financial Position consist of:
December 31,		2013		2012
(in thousands)
Noncurrent assets/(liabilities)	$	6,422	$	(43,271	)

Schedule of amounts recognized in accumulated other comprehensive income

Amounts Recognized in Accumulated Other Comprehensive Income consists of:
December 31,		2013		2012
(in thousands)
Net actuarial loss	$	56,742	$	102,419

Schedule of weighted-average assumptions used

The following weighted-average assumptions were used to determine the accumulated benefit obligation and net benefit cost:

December 31,	2013			2012			2011
ACCUMULATED BENEFIT OBLIGATION
Discount rate		5.20	%		4.17	%		5.01	%
Rate of compensation increase		N/A			N/A			N/A
NET BENEFIT COST
Discount rate		4.17	%		5.01	%		5.51	%
Expected return on plan assets		7.00	%		7.00	%		7.00	%
Rate of compensation increase		N/A			N/A			N/A

Schedule of net periodic benefit cost and other amounts recognized in other comprehensive income

The components of net periodic benefit cost are summarized as follows:

Years ended December 31,	2013			2012			2011
(in thousands)
Service cost	$	112		$	100		$	158
Interest cost		8,551			9,622			9,879
Expected return on plan assets		(11,589	)		(12,106	)		(12,080	)
Amortization of net loss		3,910			3,606			1,800
Net periodic loss/(benefit)	$	984		$	1,222		$	(243	)

The benefit obligations recognized in other comprehensive income for the years ended December 31, 2013, 2012 and 2011 are summarized as follows:

(in thousands)	2013			2012			2011
Pretax (income)/loss	$	(41,767	)	$	18,991		$	26,297
Amortization of net loss		(3,910	)		(3,606	)		(1,800	)
Total recognized in other comprehensive income		(45,677	)		15,385			24,497
Total recognized in net periodic benefit (income)/cost and other comprehensive income	$	(44,693	)	$	16,607		$	24,254

Schedule of weighted average asset allocation along with target allocation

The Plans’ weighted average asset allocation at December 31, 2013 and 2012 by asset category, along with the target allocation for 2014, are as follows:

	Target			Percentage of plan assets as of
	allocations for			December 31,
Asset category	2014			2013			2012
Cash and cash equivalents		0% - 5%			0.6	%		0.2	%
Equity securities - Rollins stock		0% - 30%			19.3	%		15.9	%
Domestic equity - all other		0% - 30%			21.5	%		13.0	%
Global equity		0.0	%		0.0	%		12.5	%
International equity		10% - 30%			25.3	%		13.6	%
Debt securities - core fixed income		15% - 50%			20.4	%		17.1	%
Tactical composite		0.0	%		0.0	%		12.5	%
Real estate		0% - 20%			6.7	%		7.7	%
Real return		0% - 20%			6.2	%		7.5	%
Other		0% - 20%			0.0	%		0.0	%
Total

Schedule of plan assets using the fair value hierarchy

The following table presents our plan assets using the fair value hierarchy as of December 31, 2013. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. See note 7 for a brief description of the three levels under the fair value hierarchy.

(in thousands)		Total		Level 1		Level 2		Level 3
(1)	Cash and Cash Equivalents	$	1,067	$	1,067	$	—	$	—
(2)	Fixed Income Securities		39,273		—		39,273		—
	Domestic Equity Securities
	Rollins, Inc. Stock		37,067		37,067		—		—
	Other Securities		41,357		41,357		—		—
(3)	International Equity Securities		48,780		—		48,780		—
(4)	Real Estate		12,831		—		—		12,831
(5)	Real Return		11,994		—		11,994		—
	Total	$	192,369	$	79,491	$	100,047	$	12,831

The following table presents our plan assets using the fair value hierarchy as of December 31, 2012. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value.

(in thousands)		Total		Level 1		Level 2		Level 3
(1)	Cash and Cash Equivalents	$	289	$	289	$	—	$	—
(2)	Fixed Income Securities		28,624		—		28,624		—
	Domestic Equity Securities				—		—		—
	Rollins, Inc. Stock		26,644		26,644		—		—
	Other Securities		21,779		21,779		—		—
	Global Equity Securities		20,990		20,990		—		—
(3)	International Equity Securities		22,758		10,805		11,953		—
(6)	Tactical Composite		21,026		—		21,026		—
(4)	Real Estate		12,890		—		—		12,890
(5)	Real Return		12,544		—		12,544		—
	Total	$	167,544	$	80,507	$	74,147	$	12,890

(1) Cash and cash equivalents, which are used to pay benefits and plan administrative expenses, are held in Rule 2a-7 money market funds.

(2) Fixed income securities are primarily valued using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades.

(3) Some International equity securities are valued using a market approach based on the quoted market prices of identical instruments in their respective markets.

(4) Real estate fund values are primarily reported by the fund manager and are based on valuation of the underlying investments, which include inputs such as cost, discounted future cash flows, independent appraisals and market based comparable data.

(5) Real Return funds invest in global equities, commodities and inflation protected core bonds that are valued primarily using a market approach based on the quoted market prices of identical instruments in their respective markets.

(6) Tactical Composite funds invest in stocks, bonds and cash, both domestic and international. These assets are valued primarily using a market approach based on the quoted market prices of identical instruments in their respective markets.

Schedule of reconciliation of level 3 assets

The following table presents a reconciliation of Level 3 assets held during the year ended December 31, 2013.

					Net			Net
	Balance at		Net Realized		Purchases,			Transfers		Balance at
	December 31,		and Unrealized		Issuances and			In to/(Out of)		December 31,
(in thousands)	2012		Gains/(Losses)		Settlements			Level 3		2013
Real Estate	$	12,890	$	1,061	$	(1,120	)	$	—	$	12,831
Total	$	12,890	$	1,061	$	(1,120	)	$	—	$	12,831

The following table presents a reconciliation of Level 3 assets held during the year ended December 31, 2012.

					Net		Net
	Balance at		Net Realized		Purchases,		Transfers		Balance at
	December 31,		and Unrealized		Issuances and		In to/(Out of)		December 31,
(in thousands)	2011		Gains/(Losses)		Settlements		Level 3		2012
Real Estate	$	7,092	$	997	$	4,801	$	—	$	12,890
Total	$	7,092	$	997	$	4,801	$	—	$	12,890

Schedule of estimated future benefit payments

The estimated future benefit payments over the next ten years are as follows:

(in thousands)
2014	$	9,877
2015		10,364
2016		10,794
2017		11,251
2018		11,724
Thereafter		63,089
Total	$	117,099

Schedule of estimated life insurance premium payments

The estimated life insurance premium payments over the next five years are as follows:

(in thousands)
2014	$	121
2015		467
2016		1,693
2017		1,500
2018		1,661
Total	$	5,442