Cash, Cash Equivalents, and Marketable Debt Securities

3 Months Ended

Mar. 31, 2020

Cash Cash Equivalents And Short Term Investments [Abstract]

Cash, Cash Equivalents, and Marketable Debt Securities

12. Cash, Cash Equivalents, and Marketable Debt Securities

The following table shows the Company’s cash and available-for-sale (AFS) debt securities by major asset category at March 31, 2020 and December 31, 2019 (in millions):

	March 31, 2020
	Adjusted Cost Basis		Unrealized Gain		Unrealized Loss			Fair Value		Cash and Cash Equivalents		Short-Term Marketable Debt Securities		Long-Term Marketable Debt Securities
Cash and cash equivalents	$	763.2	$	—	$	—		$	763.2	$	763.2	$	—	$	—
Level 1 (a):
Money market funds		0.3		—		—			0.3		0.3		—		—
U.S. Treasury securities		30.7		0.4		—			31.1		0.5		13.8		16.8
Subtotal		31.0		0.4		—			31.4		0.8		13.8		16.8
Level 2 (b):
Certificates of deposit		3.9		—		—			3.9		—		3.9		—
Commercial paper		1.8		—		—			1.8		—		1.8		—
U.S. government agency securities		5.6		—		—			5.6		—		3.0		2.6
Corporate debt securities		108.2		0.1		(0.8	)		107.5		—		69.8		37.7
Subtotal		119.5		0.1		(0.8	)		118.8		—		78.5		40.3
Total	$	913.7	$	0.5	$	(0.8	)	$	913.4	$	764.0	$	92.3	$	57.1

	December 31, 2019
	Adjusted Cost Basis		Unrealized Gain		Unrealized Loss		Fair Value (c)		Cash and Cash Equivalents		Short-Term Marketable Debt Securities		Long-Term Marketable Debt Securities
Cash and cash equivalents	$	675.6					$	675.6	$	675.6	$	—	$	—
Level 1 (a):
Money market funds		0.1		—		—		0.1		0.1		—		—
U.S. Treasury securities		27.1		—		—		27.1		3.1		11.5		12.5
Subtotal		27.2						27.2		3.2		11.5		12.5
Level 2 (b):
Certificates of deposit		3.9		—		—		3.9		—		3.9		—
Commercial paper		5.6		—		—		5.6		0.7		4.9		—
U.S. government agency securities		7.0		—		—		7.0		—		3.0		4.0
Corporate debt securities		106.2		—		—		106.2		—		64.6		41.6
Subtotal		122.7						122.7		0.7		76.4		45.6
Total	$	825.5	$	—	$	—	$	825.5	$	679.5	$	87.9	$	58.1

(a) Valuations based on quoted prices for identical assets or liabilities in active markets.

(b) Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

(c) Unrealized gains and losses were insignificant as of December 31, 2019. Therefore, the fair value approximates the adjusted cost basis for each major asset category.

For the three months ended March 31, 2020, net realized gains and losses on the sales and maturities of certain marketable debt securities were insignificant.  

The Company invests in highly rated securities, with the primary objective of minimizing the potential risk of principal loss. The Company’s investment policy requires securities to be investment grade and limits the amount of credit exposure to any one issuer. The maturities of the Company’s long-term marketable debt securities generally range from one to two years.

Fair values were determined for each individual marketable debt security in the investment portfolio. The Company evaluates each individual security to determine whether the security is impaired. An impairment exists when a security’s fair value is below its amortized cost basis. The Company reviews each impaired investment to determine if the decline in fair value below the amortized cost basis resulted from a credit loss or other factors. If the impairment of a marketable debt security (or a portion of the impairment) is due to credit factors of the issuer, the Company records an allowance for credit losses. Non-credit related impairments are recorded in Other Comprehensive Income (OCI). PCA reviews factors such as the duration and extent to which the fair value of the marketable debt security is less than its cost, the financial condition of the issuer and any changes thereto, the general market condition in which the issuer operates, and ability of the issuer to make all required payments of the marketable debt security. PCA utilizes various credit rating services to provide information on the impaired investment of a particular issuer.

As of March 31, 2020 and December 31, 2019, we do not consider any of our marketable debt securities to be other-than-temporarily impaired. Any impairment existing at March 31, 2020 or December 31, 2019 is not related to credit losses. Therefore, we have not recorded an allowance for credit losses related to our marketable debt securities. All unrealized gains and losses were recorded in OCI.

The following table provides information about the Company’s marketable debt securities that have been in a continuous loss position as of March 31, 2020 and December 31, 2019 (in millions, except number of marketable debt securities in a loss position):

	March 31. 2020							December 31, 2019
	Fair Value of Marketable Debt Securities		Number of Marketable Debt Securities in a Loss Position		Unrealized Losses			Fair Value of Marketable Debt Securities		Number of Marketable Debt Securities in a Loss Position		Unrealized Losses
Certificates of deposit	$	1.7	2		$	—		$	—		—	$	—
U.S. Treasury securities		—		—		—			14.0	9			—
U.S. government agency securities		1.1	1			—			0.8	1			—
Corporate debt securities		102.1	105			(0.8	)		63.3	61			—
	$	104.9	108		$	(0.8	)	$	78.1	71		$	—