Marketable Debt Securities

8 Months Ended

May 06, 2023

Marketable Debt Securities

Marketable Debt Securities

Note D – Marketable Debt Securities

Marketable debt securities are carried at fair value, with unrealized gains and losses, net of income taxes, recorded in Accumulated other comprehensive loss until realized, and any credit risk related losses are recognized in net income in the period incurred. The Company’s basis for determining the cost of a security sold is the “Specific Identification Model.”

The Company’s available-for-sale marketable debt securities consisted of the following:

	May 6, 2023
	Amortized		Gross		Gross
	Cost		Unrealized		Unrealized		Fair
(in thousands)	Basis		Gains		Losses		Value
Corporate debt securities	$	32,516	$	73	$	(197)	$	32,392
Government bonds		64,087		116		(1,334)		62,869
Mortgage-backed securities		3,689		—		(215)		3,474
Asset-backed securities and other		25,936		22		(229)		25,729
	$	126,228	$	211	$	(1,975)	$	124,464

	August 27, 2022
	Amortized		Gross		Gross
	Cost		Unrealized		Unrealized		Fair
(in thousands)	Basis		Gains		Losses		Value
Corporate debt securities	$	15,293	$	1	$	(298)	$	14,996
Government bonds		88,903		—		(1,963)		86,940
Mortgage-backed securities		4,600		—		(243)		4,357
Asset-backed securities and other		6,531		—		(279)		6,252
	$	115,327	$	1	$	(2,783)	$	112,545

The marketable debt securities held at May 6, 2023, had effective maturities ranging from less than one year to approximately three years. Securities maturing in less than one year totaled $42.6 million and $49.7 million at May 6, 2023 and August 27, 2022, respectively. Securities maturing between one and three years totaled $81.9 million and $62.8 million at May 6, 2023 and August 27, 2022, respectively. At May 6, 2023, the Company held 60 securities that are in an unrealized loss position of approximately $2.0 million. In evaluating whether a credit loss exists for the securities, the Company considers factors such as the severity of the loss position, the credit worthiness of the investee, the term to maturity and the intent and ability to hold the investments until maturity or until recovery of fair value. An allowance for credit losses was deemed unnecessary given consideration of the factors above.

Included above in total available-for-sale marketable debt securities are $105.1 million of marketable debt securities transferred by the Company’s insurance captive to a trust account to secure its obligations to an insurance company related to future workers’ compensation and casualty losses.