Quarterly report pursuant to Section 13 or 15(d)

FAIR VALUE OF FINANCIAL INSTRUMENTS

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FAIR VALUE OF FINANCIAL INSTRUMENTS
 6 Months Ended
Jun. 30, 2021
Fair Value Disclosures [Abstract]  
FAIR VALUE OF FINANCIAL INSTRUMENTS

 

NOTE 7. FAIR VALUE OF FINANCIAL INSTRUMENTS

 

The Company’s financial instruments consist of cash and cash equivalents, trade receivables, notes receivable, accounts payable, other short-term liabilities, and debt. The carrying amounts of these financial instruments approximate their respective fair values. The Company also has derivative instruments as further discussed in Note 15. Derivative Instruments and Hedging Activities.

 

During the quarter ending June 30, 2021, the Company invested $10.6 million of unrestricted cash in international bonds, a level 2 asset under the fair value hierarchy. The investment is recorded in other current assets. The fair market values of the bonds approximates their amortized cost.

 

As of June 30, 2021 and 2020, the Company had $27.1 million and $47.1 million of acquisition holdback and earnout liabilities with the former owners of acquired companies. The earnout liabilities were discounted to reflect the expected probability of payout, and both earnout and holdback liabilities were discounted to their net present value on the Company’s books and are considered level 3 liabilities. The table below presents a summary of the changes in fair value for these liabilities.

 

    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
(in thousands)   2021     2020     2021     2020  
Beginning   $ 32,976     $ 51,328     $ 35,744     $ 49,131  
New acquisitions and revaluations     1,906       1,054       3,973       5,543  
Payouts     (7,947 )     (5,822 )     (12,873 )     (7,862 )
Interest on outstanding contingencies     258       565       537       1,148  
Charge offset, forfeit and other     (136 )     (40 )     (324 )     (875 )
Ending Balance   $ 27,057     $ 47,085     $ 27,057     $ 47,085