Our unaudited condensed consolidated financial statements include the accounts of Service Corporation International and all subsidiaries in which we hold a controlling financial interest. Intercompany balances and transactions have been eliminated in consolidation.

Our unaudited condensed consolidated financial statements also include the accounts of the merchandise and service trusts and cemetery perpetual care trusts in which we have a variable interest and are the primary beneficiary. We have retained the specialized industry accounting principles when consolidating the trusts. Although we consolidate the trusts, it does not change the legal relationships among the trusts, us, or our customers. The customers are the legal beneficiaries of these trusts; therefore, their interests in these trusts represent a liability to us.

Our interim condensed consolidated financial statements are unaudited but include all adjustments, consisting of normal recurring accruals and any other adjustments, which management considers necessary for a fair statement of our results for these periods. Our unaudited condensed consolidated financial statements have been prepared in a manner consistent with the accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2022, unless otherwise disclosed herein, and should be read in conjunction therewith. The accompanying year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year period.

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. As a result, actual results could differ from these estimates.

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. The carrying amounts of our cash and cash equivalents approximate fair value due to the short-term nature of these instruments.


	June 30, 2023		December 31, 2022
	(In thousands)
Cash and cash equivalents	$	172,516	$	191,938
Restricted cash (1)
Included in Other current assets	2,076		10,379
Included in Deferred charges and other assets, net	2,209		2,207
Total restricted cash	4,285		12,586
Total cash, cash equivalents, and restricted cash	$	176,801	$	204,524

(1) Restricted cash in both periods primarily consists of proceeds from divestitures deposited into escrow accounts under IRS code section 1031 and collateralized obligations under certain insurance policies.


	June 30, 2023
	Atneed Funeral		Atneed Cemetery		Miscellaneous		Current Portion of Notes		Total
	(In thousands)
Receivables	$	29,220	$	21,224	$	37,821	$	170	$	88,435
Reserve for credit losses	(1,884)		(1,988)		(413)		(138)		(4,423)
Receivables, net	$	27,336	$	19,236	$	37,408	$	32	$	84,012


	December 31, 2022
	Atneed Funeral		Atneed Cemetery		Miscellaneous		Current Portion of Notes		Total
	(In thousands)
Receivables	$	44,417	$	19,781	$	38,483	$	186	$	102,867
Reserve for credit losses	(3,627)		(2,076)		(344)		(139)		(6,186)
Receivables, net	$	40,790	$	17,705	$	38,139	$	47	$	96,681


	June 30, 2023		December 31, 2022
	(In thousands)
Notes receivable	$	9,691	$	9,367
Reserve for credit losses	(1,265)		(2,546)
Notes receivable, net	$	8,426	$	6,821

Long-term miscellaneous receivables	$	7,884	$	7,993
Reserve for credit losses	(724)		(1,056)
Long-term miscellaneous receivables, net	$	7,160	$	6,937

The following table summarizes the activity in our reserve for credit losses by portfolio segment, excluding preneed receivables which are presented in Note 3, for the six months ended June 30, 2023:


	December 31, 2022		(Provision) benefit for Expected Credit Losses		Acquisitions (Divestitures), net		Write Offs		Recoveries		Effect of Foreign Currency and Other		June 30, 2023
	(In thousands)
Trade receivables:
Funeral	$	(3,627)	$	(674)	$	(55)	$	3,306	$	(870)	$	36	$	(1,884)
Cemetery	(2,076)		(310)		—		554		(154)		(2)		(1,988)
Total reserve for credit losses on trade receivables	$	(5,703)	$	(984)	$	(55)	$	3,860	$	(1,024)	$	34	$	(3,872)

Miscellaneous receivables:
Current	$	(344)	$	(69)	$	—	$	—	$	—	$	—	$	(413)
Long-term	(1,056)		332		—		—		—		—		(724)
Total reserve for credit losses on miscellaneous receivables	$	(1,400)	$	263	$	—	$	—	$	—	$	—	$	(1,137)

Notes receivable	$	(2,685)	$	2	$	—	$	1,280	$	—	$	—	$	(1,403)


	2023		2022		2021		2020		2019		Prior		Revolving Line of Credit		Total
	(In thousands)
Miscellaneous receivables:
Current	$	34,130	$	2,709	$	541	$	277	$	157	$	7	$	—	$	37,821
Long-term	1,905		2,824		1,840		614		672		29		—		7,884
Total miscellaneous receivables	$	36,035	$	5,533	$	2,381	$	891	$	829	$	36	$	—	$	45,705

Notes receivable	$	—	$	—	$	—	$	10	$	—	$	4,730	$	5,121	$	9,861


	Past Due
	<30 Days		30-90 Days		90-180 Days		>180 Days		Total		Current		Total
	(In thousands)
Miscellaneous receivables:
Current	$	—	$	—	$	316	$	1,103	$	1,419	$	36,402	$	37,821
Long-term	—		—		—		—		—		7,884		7,884
Total miscellaneous receivables	$	—	$	—	$	316	$	1,103	$	1,419	$	44,286	$	45,705

Notes receivable	$	—	$	11	$	—	$	1,116	$	1,127	$	8,734	$	9,861

In March 2022, the Financial Accounting Standards Board (FASB) amended guidance to require public companies to disclose the vintage year of receivable write-offs during the reporting period. We adopted the amended guidance in 2023 with no impact on our consolidated results of operations, consolidated financial position, and cash flows. As receivable write-offs in the six months ended June 30, 2023 were immaterial, we have not included the vintage year disclosure in this filing. We will add the vintage year disclosure in future filings for periods in which receivable write-offs are material, if any.

In March 2023, the FASB amended guidance for equity investments made primarily for the purpose of receiving income tax credits and other income tax benefits. The amended guidance expands the option to use the proportional amortization method from investments in low-income-housing tax credit structures to all tax credit structures that meet certain requirements. The proportional amortization method results in the cost of the investment being amortized in proportion to the income tax credits and other income tax benefits received, with the investment amortization and the income tax credits presented net in the statement of operations as a component of income tax expense. The new guidance is effective as of January 1, 2024 with early adoption permitted. We are still evaluating the impact of the guidance on our consolidated results of operations, consolidated financial position, and cash flows.

In March 2023, the FASB amended guidance on determining the useful life of leasehold improvements associated with a lease between related parties under common control. The amended guidance requires that the leasehold improvements be amortized over the useful life of the improvements to the common control group as a whole. The new guidance is effective for us on January 1, 2024 and is not expected to have any impact on our consolidated results of operations, consolidated financial position, and cash flows.