ADP 2015 Annual Report Download - page 57

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The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than
12 months as of June 30, 2015 are as follows:
June 30, 2015
Securities in unrealized loss
position less than
12 months
Securities in unrealized loss
position greater than 12 months
Total
Unrealized
losses
Fair market
value
Unrealized
losses
Fair market
value
Gross
unrealized
losses
Fair
market value
Corporate bonds $ (27.3)
$ 2,403.5
$ (2.3)
$ 228.1
$ (29.6)
$ 2,631.6
U.S. government agency securities (6.9)
836.5
(2.6)
374.0
(9.5)
1,210.5
Asset-backed securities (3.2)
606.8
(2.9)
443.6
(6.1)
1,050.4
Canadian government securities and
Canadian government agency securities (0.2)
85.8
—
—
(0.2)
85.8
Canadian provincial bonds (0.8)
101.5
—
10.0
(0.8)
111.5
U.S. Treasury securities (0.3)
28.6
—
—
(0.3)
28.6
Municipal bonds (1.2)
143.6
(0.2)
6.0
(1.4)
149.6
Other securities (0.4)
36.6
(0.3)
13.7
(0.7)
50.3
$ (40.3)
$ 4,242.9
$ (8.3)
$ 1,075.4
$ (48.6)
$ 5,318.3
At June 30, 2016 , Corporate bonds include investment-grade debt securities, which include a wide variety of issuers, industries, and sectors, primarily
carry credit ratings of A and above, and have maturities ranging from July 2016 to April 2024 .
At June 30, 2016 , U.S. government agency securities primarily include debt directly issued by Federal Home Loan Banks and Federal Farm Credit Banks
with fair values of $3,220.0 million and $976.2 million , respectively. U.S. government agency securities represent senior, unsecured, non-callable debt that
primarily carry ratings of Aaa by Moody's and AA+ by Standard & Poor's with maturities ranging from July 2016 through May 2024 .
At June 30, 2016 , asset-backed securities include AAA rated senior tranches of securities with predominately prime collateral of fixed-rate credit card,
auto loan, equipment lease and rate reduction receivables with fair values of $2,172.3 million , $1,054.8 million , $338.2 million , and $255.2 million
respectively. These securities are collateralized by the cash flows of the underlying pools of receivables. The primary risk associated with these securities is the
collection risk of the underlying receivables. All collateral on such asset-backed securities has performed as expected through June 30, 2016 .
At June 30, 2016 , other securities and their fair value primarily represent: AAA and AA rated supranational bonds of $189.8 million , AAA and AA rated
sovereign bonds of $188.9 million , and AA rated mortgage-backed securities of $99.0 million that are guaranteed primarily by Federal National Mortgage
Association ("Fannie Mae"). The Company's mortgage-backed securities represent an undivided beneficial ownership interest in a group or pool of one or more
residential mortgages. These securities are collateralized by the cash flows of 15 -year and 30 -year residential mortgages and are guaranteed by Fannie Mae as to
the timely payment of principal and interest.
Classification of corporate investments on the Consolidated Balance Sheets is as follows:
June 30,
2016
2015
Corporate investments:
Cash and cash equivalents
$ 3,191.1
$ 1,639.3
Short-term marketable securities
23.5
26.6
Long-term marketable securities
7.8
28.9
Total corporate investments
$ 3,222.4
$ 1,694.8
Funds held for clients represent assets that, based upon the Company's intent, are restricted for use solely for the purposes of satisfying the obligations to
remit funds relating to the Company’s payroll and payroll tax filing services, which are classified as client funds obligations on our Consolidated Balance Sheets.
55