DEFERRED REVENUES AND COSTS

6 Months Ended

Jun. 30, 2022

Revenue from Contract with Customer [Abstract]

DEFERRED REVENUES AND COSTS

10.DEFERRED REVENUES AND COSTS

The Company defers revenues and all direct costs associated with the sale of pre-need cemetery merchandise and services until the merchandise is delivered or the services are performed. The Company recognizes deferred merchandise and service revenues as customer contract liabilities within long-term liabilities on its consolidated balance sheets. The Company recognizes deferred direct costs associated with pre-need cemetery merchandise and service revenues as deferred selling and obtaining costs within long-term assets on its consolidated balance sheets. The Company also defers the costs to obtain new pre-need cemetery and new prearranged funeral business as well as the investment earnings on the prearranged services and merchandise trusts. Such costs are recognized when the associated performance obligation is fulfilled based upon the net change in the customer contract liabilities. All other selling costs are expensed as incurred. Additionally, the Company has elected the practical expedient of not recognizing incremental costs to obtain a contract as incurred, as the associated amortization period is typically one year or less.

Deferred revenues and related costs consisted of the following (in thousands):

	June 30, 2022		December 31, 2021
Deferred contract revenues	$	915,822	$	880,290
Deferred merchandise trust revenue		163,735		150,368
Deferred merchandise trust unrealized gains (losses)		38,651		25,602
Deferred revenues	$	1,118,208	$	1,056,260
Deferred selling and obtaining costs	$	127,927	$	124,023

For the six months ended June 30, 2022 and 2021, the Company recognized $42.8 million and $42.9 million, respectively, of the customer contract liabilities balance that existed at December 31, 2021 and 2020, respectively, as revenue.

The components of the customer contract liabilities, net in the Company’s consolidated balance sheets at June 30, 2022 and December 31, 2021 were as follows (in thousands):

	June 30, 2022			December 31, 2021
Customer contract liabilities, gross	$	1,145,408		$	1,082,970
Amounts due from customers for unfulfilled performance obligations on cancellable    pre-need contracts		(27,200	)		(26,710	)
Customer contract liabilities, net	$	1,118,208		$	1,056,260

The Company expects to service approximately 55% of its deferred revenue in the first 4-5 years and approximately 80% of its deferred revenue within 18 years. The Company cannot estimate the period when it expects its remaining performance obligations will be recognized, because certain performance obligations will only be satisfied at the time of death.