Fair Value Measurements

3 Months Ended

Mar. 31, 2020

Fair Value Measurements

Fair Value Measurements

7. Fair Value Measurements

Fair value, as defined by the relevant accounting standards, represents the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. For additional information on how the

Company measures fair value, refer to the Company’s consolidated financial statements within the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

The following tables present the Company’s assets and liabilities which are measured at fair value on a recurring basis, by balance sheet line item (in millions):

	Fair Value Measurement Using				Total
March 31, 2020	Level 1		Level 2		Fair Value
Assets:
Settlement assets:
Measured at fair value through net income:
Money market funds	$	24.3	$	—	$	24.3
Measured at fair value through other comprehensive income (net of expected credit losses recorded through net income):
State and municipal debt securities		—		1,347.6		1,347.6
State and municipal variable-rate demand notes		—		207.5		207.5
United States government agency mortgage-backed securities		—		64.5		64.5
Corporate debt securities		—		34.2		34.2
Other assets:
Derivatives		—		401.2		401.2
Total assets	$	24.3	$	2,055.0	$	2,079.3
Liabilities:
Other liabilities:
Derivatives	$	—	$	323.5	$	323.5
Total liabilities	$	—	$	323.5	$	323.5

	Fair Value Measurement Using				Total
December 31, 2019	Level 1		Level 2		Fair Value
Assets:
Settlement assets:
Measured at fair value through net income:
Money market funds	$	24.6	$	—	$	24.6
Measured at fair value through other comprehensive income:
State and municipal debt securities		—		1,257.8		1,257.8
State and municipal variable-rate demand notes		—		276.1		276.1
United States government agency mortgage-backed securities		—		67.2		67.2
Corporate debt securities		—		52.4		52.4
Other United States government agency debt securities		—		34.9		34.9
United States Treasury securities		10.0		—		10.0
Other assets:
Derivatives		—		204.5		204.5
Total assets	$	34.6	$	1,892.9	$	1,927.5
Liabilities:
Other liabilities:
Derivatives	$	—	$	159.5	$	159.5
Total liabilities	$	—	$	159.5	$	159.5

No material non-recurring fair value adjustments or transfers between Level 1 and Level 2 measurements were recorded during the three months ended March 31, 2020 and 2019.

Other Fair Value Measurements

The carrying amounts for many of the Company’s financial instruments, including certain cash and cash equivalents, settlement cash and cash equivalents, and settlement receivables and obligations approximate fair value due to their short maturities. The Company’s borrowings are classified as Level 2 within the valuation hierarchy, and the aggregate fair value of these borrowings was based on quotes from multiple banks. Fixed-rate notes are carried in the Company’s Condensed Consolidated Balance Sheets at their original issuance values as adjusted over time to accrete that value to par. As of March 31, 2020, the carrying value and fair value of the Company’s borrowings were $3,070.1 million and $3,001.9 million, respectively (see Note 13). As of December 31, 2019, the carrying value and fair value of the Company’s borrowings were $3,229.3 million and $3,372.2 million, respectively.