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Preneed Activities (Notes)
 3 Months Ended
Mar. 31, 2018
Preneed Activities [Abstract]  
Preneed Activities
3. Preneed Activities
Preneed receivables, net and trust investments
The components of Preneed receivables, net and trust investments in our unaudited Condensed Consolidated Balance Sheet at March 31, 2018 and December 31, 2017 are as follows:
 
March 31, 2018
 
December 31, 2017
 
(In thousands)
Preneed funeral receivables(1)
$
33,528

 
$
336,925

Preneed cemetery receivables(1)
824,719

 
1,118,146

Preneed receivables from customers(1)
858,247

 
1,455,071

Unearned finance charge
(45,541
)
 
(45,515
)
Allowance for cancellation (1)
(46,136
)
 
(107,749
)
Preneed receivables, net
$
766,570

 
$
1,301,807

 
 
 
 
Trust investments, at market
$
4,666,645

 
$
4,749,548

Assets associated with businesses held for sale
(144
)
 
(5,660
)
Insurance-backed fixed income securities and other
263,563

 
265,314

Trust investments
4,930,064

 
5,009,202

Less: Cemetery perpetual care trust investments
(1,497,220
)
 
(1,532,167
)
Preneed trust investments
$
3,432,844

 
$
3,477,035

 
 
 
 
Preneed receivables, net and trust investments
$
4,199,414

 
$
4,778,842


(1)
Upon adoption of "Revenue from Contracts with Customers" on January 1, 2018, we reclassified amounts due from customers for unfulfilled performance obligations on cancelable preneed contracts as a reduction in Deferred revenue, net. As a result of this reclassification, we eliminated the allowance for cancellation on these performance obligations.

The table below sets forth certain investment-related activities associated with our trusts:
 
 
Three Months Ended
 
 
March 31,
 
 
2018
 
2017
 
 
(In thousands)
Deposits
 
$
93,269

 
$
84,487

Withdrawals
 
$
106,769

 
$
93,082

Purchases of securities
 
$
599,651

 
$
517,031

Sales of securities
 
$
614,424

 
$
487,925

Realized gains (1)
 
$
58,306

 
$
52,433

Realized losses (1)
 
$
(12,296
)
 
$
(21,774
)

(1)
All realized gains and losses are recognized in Other income (expense), net for our trust investments and are offset by a corresponding reclassification in Other income (expense), net to Deferred receipts held in trust and Care trusts' corpus.
 



The costs and values associated with trust investments recorded at fair value at March 31, 2018 and December 31, 2017 are detailed below. Cost reflects the investment (net of redemptions) of control holders in the trusts. Fair value represents the value of the underlying securities held by the trusts.
 
March 31, 2018
 
Value Hierarchy Level
 
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Value
 
 
 
 
 
(In thousands)
 
 
Fixed income securities:
 
 
 
 
 
 
 
 
 
U.S. Treasury
2
 
$
47,338

 
$
12

 
$
(429
)
 
$
46,921

Canadian government
2
 
60,522

 
78

 
(1,379
)
 
59,221

Corporate
2
 
12,402

 
269

 
(260
)
 
12,411

Residential mortgage-backed
2
 
3,312

 
16

 
(61
)
 
3,267

Asset-backed
2
 
305

 
11

 
(11
)
 
305

Equity securities:
 
 
 
 
 
 
 
 
 
Preferred stock
2
 
7,120

 
363

 
(172
)
 
7,311

Common stock:
 
 
 
 
 
 
 
 
 
United States
1
 
1,208,816

 
241,804

 
(46,846
)
 
1,403,774

Canada
1
 
30,150

 
9,751

 
(1,503
)
 
38,398

Other international
1
 
63,594

 
12,741

 
(3,280
)
 
73,055

Mutual funds:
 
 
 
 
 
 
 
 
 
Equity
1
 
696,520

 
53,631

 
(9,364
)
 
740,787

Fixed income
1
 
1,139,940

 
4,227

 
(32,959
)
 
1,111,208

Other
3
 
5,441

 
3,107

 
(15
)
 
8,533

Trust investments, at fair value
 
 
3,275,460

 
326,010

 
(96,279
)
 
3,505,191

Commingled funds
 
 
 
 
 
 
 
 
 
Fixed income
 
 
417,729

 
41

 
(12,473
)
 
405,297

Equity
 
 
223,207

 
10,312

 
(647
)
 
232,872

Money market funds
 
 
294,039

 
—

 
—

 
294,039

Private equity
 
 
172,522

 
59,112

 
(2,388
)
 
229,246

Trust investments, at net asset value
 
 
1,107,497

 
69,465

 
(15,508
)
 
1,161,454

Trust investments, at market
 
 
$
4,382,957

 
$
395,475

 
$
(111,787
)
 
$
4,666,645

 
December 31, 2017
 
Value Hierarchy Level
 
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Value
 
 
 
 
 
(In thousands)
 
 
Fixed income securities:
 
 
 
 
 
 
 
 
 
U.S. Treasury
2
 
$
48,805

 
$
14

 
$
(117
)
 
$
48,702

Canadian government
2
 
81,500

 
160

 
(1,089
)
 
80,571

Corporate
2
 
13,540

 
327

 
(170
)
 
13,697

Residential mortgage-backed
2
 
3,279

 
16

 
(14
)
 
3,281

Asset-backed
2
 
320

 
15

 
(10
)
 
325

Equity securities:
 
 
 
 
 
 
 
 
 
Preferred stock
2
 
7,834

 
385

 
(139
)
 
8,080

Common stock:
 
 
 
 
 
 
 
 
 
United States
1
 
1,161,015

 
266,822

 
(24,739
)
 
1,403,098

Canada
1
 
30,762

 
12,545

 
(522
)
 
42,785

Other international
1
 
63,510

 
13,174

 
(2,834
)
 
73,850

Mutual funds:
 
 
 
 
 
 
 
 
 
Equity
1
 
613,934

 
59,100

 
(4,312
)
 
668,722

Fixed income
1
 
1,230,196

 
11,897

 
(23,943
)
 
1,218,150

Other
3
 
5,953

 
3,114

 
—

 
9,067

Trust investments, at fair value
 
 
3,260,648

 
367,569

 
(57,889
)
 
3,570,328

Commingled funds
 
 
 
 
 
 
 
 
 
Fixed income
 
 
454,242

 
235

 
(5,860
)
 
448,617

Equity
 
 
214,000

 
12,826

 
—

 
226,826

Money market funds
 
 
287,435

 
—

 
—

 
287,435

Private equity
 
 
166,860

 
51,631

 
(2,149
)
 
216,342

Trust investments, at net asset value
 
 
1,122,537

 
64,692

 
(8,009
)
 
1,179,220

Trust investments, at market
 
 
$
4,383,185

 
$
432,261

 
$
(65,898
)
 
$
4,749,548


As of March 31, 2018, our unfunded commitment for our private equity and other investments was $112.8 million which, if called, would be funded by the assets of the trusts.
The change in our market-based trust investments with significant unobservable inputs (Level 3) is as follows:
 
 
Three Months Ended
 
 
March 31,
 
 
2018
 
2017
 
 
(In thousands)
Fair value, beginning balance
 
$
9,067

 
$
8,667

Net unrealized (loss) gain included in Other income (expense), net(1)
 
(534
)
 
16

Distributions and other
 
—

 
(73
)
Fair value, ending balance
 
$
8,533

 
$
8,610


(1)
All net unrealized (losses) gains recognized in Other income (expense), net for our trust investments are offset by a corresponding reclassification in Other income (expense), net to Deferred receipts held in trust and Care trusts' corpus.
Maturity dates of our fixed income securities range from 2018 to 2040. Maturities of fixed income securities (excluding mutual funds) at March 31, 2018 are estimated as follows:
 
Fair Value
 
(In thousands)
Due in one year or less
$
54,629

Due in one to five years
57,445

Due in five to ten years
9,680

Thereafter
371

 
$
122,125

Recognized trust fund income (realized and unrealized) related to these trust investments was $44.9 million and $38.2 million for the three months ended March 31, 2018 and 2017, respectively.
We have determined that the unrealized losses in our fixed income investments are considered temporary in nature, as the unrealized losses were due to temporary fluctuations in interest rates. We believe that none of the securities are other-than-temporarily impaired based on our analysis of the investments. Our analysis included a review of the portfolio holdings and discussions with the individual money managers as to the credit ratings and the severity and duration of the unrealized losses. Our fixed income investment unrealized losses, their associated values, and the duration of unrealized losses as of March 31, 2018 and December 31, 2017, respectively, are shown in the following tables:
 
March 31, 2018
 
In Loss Position
Less Than 12 Months
 
In Loss Position
Greater Than 12 Months
 
Total
 
Value
 
Unrealized
Losses
 
Value
 
Unrealized
Losses
 
Value
 
Unrealized
Losses
 
 
 
 
 
(In thousands)
 
 
 
 
Fixed income securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury
$
27,045

 
$
(402
)
 
$
2,045

 
$
(27
)
 
$
29,090

 
$
(429
)
Canadian government
16,545

 
(684
)
 
9,999

 
(695
)
 
26,544

 
(1,379
)
Corporate
4,728

 
(80
)
 
4,165

 
(180
)
 
8,893

 
(260
)
Residential mortgage-backed
2,868

 
(59
)
 
150

 
(2
)
 
3,018

 
(61
)
 Asset-backed
5

 
(1
)
 
93

 
(10
)
 
98

 
(11
)
Total temporarily fixed income impaired securities
$
51,191

 
$
(1,226
)
 
$
16,452

 
$
(914
)
 
$
67,643

 
$
(2,140
)
 
December 31, 2017
 
In Loss Position
Less Than 12 Months
 
In Loss Position
Greater Than 12 Months
 
Total
 
Value
 
Unrealized
Losses
 
Value
 
Unrealized
Losses
 
Value
 
Unrealized
Losses
 
 
 
 
 
(In thousands)
 
 
 
 
Fixed income securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury
$
29,014

 
$
(115
)
 
$
106

 
$
(2
)
 
$
29,120

 
$
(117
)
Canadian government
20,947

 
(639
)
 
6,370

 
(450
)
 
27,317

 
(1,089
)
Corporate
2,423

 
(31
)
 
4,453

 
(139
)
 
6,876

 
(170
)
Residential mortgage-backed
2,880

 
(12
)
 
151

 
(2
)
 
3,031

 
(14
)
 Asset-backed
—

 
—

 
74

 
(10
)
 
74

 
(10
)
Total temporarily impaired fixed income securities
$
55,264

 
$
(797
)
 
$
11,154

 
$
(603
)
 
$
66,418

 
$
(1,400
)