Marketable Securities, Available-for-sale

3 Months Ended

Mar. 31, 2014

Marketable Securities, Available-for-sale

Marketable Securities, Available-for-sale

Note 8.  Marketable Securities, Available-for-sale

The Company’s investment portfolio includes U.S. Treasury securities; obligations of U.S. government agencies; municipal debt securities; corporate debt securities; asset-backed securities of U.S. government agencies and covered bonds; time deposits; and short-term pooled investments. These investments are primarily held in the custody of a single financial institution. As defined in ASC No. 320 (“ASC 320”), “Investments—Debt and Equity Securities,” the Company considers its investment portfolio to be available-for-sale. Accordingly, these investments are recorded at their fair values. The cost of securities sold is based on an average-cost basis. Unrealized gains and losses on these investments were included in “Accumulated other comprehensive loss” within the Consolidated Balance Sheets.

The Company periodically reviews its available-for-sale securities for other-than-temporary declines in fair values that are below their cost bases, as well as whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. At March 31, 2014 and December 31, 2013, the Company believed that the cost bases for its available-for-sale securities were recoverable in all material respects.

For the three-month periods ended March 31, 2014 and 2013, net realized earnings associated with the Company’s investment portfolio, which included interest, dividends and net realized gains on sales of marketable securities, totaled $404,000 and $705,000, respectively. These earnings were included in “Gain from marketable securities, net” within the Consolidated Statements of Earnings. Realized gains or losses on the sales of marketable securities were included as reclassification adjustments. (See Note 4, “Accumulated Other Comprehensive Loss.”)

The following table displays the fair values of marketable securities, available-for-sale, by type of security:

	MARCH 31, 2014
(in thousands)	AMORTIZED COST		GROSS UNREALIZED GAINS		GROSS UNREALIZED LOSSES			ESTIMATED FAIR VALUE
Type of security:
U.S. Treasury securities	$	70,542	$	198	$	-		$	70,740
Obligations of U.S. government agencies	16,288		1		(11		)	16,278
Municipal debt securities	28,249		655		(771		)	28,133
Corporate debt securities	119,178		99		(20		)	119,257
Asset-backed securities	17,785		73		(22		)	17,836
Total debt securities	252,042		1,026		(824		)	252,244
Time deposits	1,408		-		-			1,408
Short-term pooled investments	11,037		-		-			11,037
Total marketable securities, available-for-sale	$	264,487	$	1,026	$	(824	)	$	264,689
	DECEMBER 31, 2013
Type of security:
U.S. Treasury securities	$	76,355	$	149	$	-		$	76,504
Obligations of U.S. government agencies	17,074		2		(8		)	17,068
Municipal debt securities	33,492		492		(1,008		)	32,976
Corporate debt securities	157,798		102		(21		)	157,879
Asset-backed securities	20,433		76		(20		)	20,489
Total debt securities	305,152		821		(1,057		)	304,916
Time deposits	1,606		-		-			1,606
Short-term pooled investments	6,633		-		-			6,633
Total marketable securities, available-for-sale	$	313,391	$	821	$	(1,057	)	$	313,155

The primary objectives of the Company’s investment portfolio are safety of principal and liquidity. Investments are made with the purpose of achieving the highest rate of return consistent with these two objectives. The Company’s investment policy limits investments to debt rated investment grade or better, as well as to bank and money market instruments and to issues by the U.S. government, U.S. government agencies and municipal or other institutions primarily with investment-grade credit ratings. Policy restrictions are placed on maturities, as well as on concentration by type and issuer.

The following table displays the fair values of marketable securities, available-for-sale, by contractual maturity:

(in thousands)	MARCH 31, 2014		DECEMBER 31, 2013
Contractual maturity:
Maturing in one year or less	$	108,440	$	129,384
Maturing after one year through three years	122,236		154,169
Maturing after three years	21,568		21,363
Total debt securities	252,244		304,916
Time deposits and short-term pooled investments	12,445		8,239
Total marketable securities, available-for-sale	$	264,689	$	313,155