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Additional Balance Sheet and Cash Flow Information | 12 Months Ended
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Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Additional Balance Sheet and Cash Flow Information | Additional Balance Sheet and Cash Flow Information Investments in marketable securities consisted of the following at December 31, (in thousands):
| 2020 |  | 2019
Mutual funds | $ | 52,061 |  |  | $ | 52,575 |
Mutual funds, included in Other long-term assets on the Consolidated balance sheets, are carried at fair value with gains and losses recorded in income. Mutual funds are held to support certain deferred compensation obligations. Inventories, net consisted of the following as of December 31, (in thousands):
| 2020 |  | 2019
Raw materials and work in process | $ | 211,979 |  |  | $ | 235,433 |
Motorcycle finished goods | 281,132 |  |  | 280,306 |
Parts & Accessories and General Merchandise | 84,469 |  |  | 144,258 |
Inventory at lower of FIFO cost or net realizable value | 577,580 |  |  | 659,997 |
Excess of FIFO over LIFO cost | (54,083) |  |  | (56,426) |
| $ | 523,497 |  |  | $ | 603,571 |
Inventory obsolescence reserves deducted from FIFO cost were $72.0 million and $49.3 million as of December 31, 2020 and 2019, respectively. Property, plant and equipment, net consisted of the following as of December 31, (in thousands):
| 2020 |  | 2019
Land and related improvements | $ | 69,518 |  |  | $ | 75,798 |
Buildings and related improvements | 428,171 |  |  | 507,178 |
Machinery and equipment | 1,577,337 |  |  | 1,609,582 |
Software | 759,675 |  |  | 750,978 |
Construction in progress | 188,823 |  |  | 148,805 |
| 3,023,524 |  |  | 3,092,341 |
Accumulated depreciation | (2,279,740) |  |  | (2,244,959) |
| $ | 743,784 |  |  | $ | 847,382 |
Software, net of accumulated amortization, included in Property, plant and equipment, net, was $100.7 million and $138.9 million as of December 31, 2020 and 2019, respectively. Accrued liabilities consisted of the following as of December 31, (in thousands):
| 2020 |  | 2019
Payroll, employee benefits and related expenses | $ | 107,511 |  |  | $ | 113,621 |
Sales incentive programs | 52,820 |  |  | 73,354 |
Warranty and recalls | 44,415 |  |  | 57,068 |
Accrued interest | 65,590 |  |  | 49,213 |
Tax-related accruals | 24,238 |  |  | 29,871 |
Leases | 17,081 |  |  | 19,013 |
Fair value of derivative financial instruments | 25,521 |  |  | 13,934 |
Restructuring | 23,920 |  |  | 867 |
Other | 196,118 |  |  | 225,347 |
| $ | 557,214 |  |  | $ | 582,288 |
Deposits – During 2020, HDFS began offering brokered certificates of deposit to customers indirectly through contractual arrangements with third-party banks and/or securities brokerage firms through its bank subsidiary. At December 31, 2020, the Company had $80.0 million, net of fees, of short-term interest-bearing brokered certificates of deposit outstanding. Each separate brokered certificate of deposit is issued under a master certificate and, as such, all outstanding brokered certificates of deposit are considered below the Federal Deposit Insurance Corporation insurance coverage limits. Operating Cash Flow – The reconciliation of Net income to Net cash provided by operating activities for the years ended December 31, was as follows (in thousands):
| 2020 |  | 2019 |  | 2018
Cash flows from operating activities: |  |  |  |  |
Net income | $ | 1,298 |  |  | $ | 423,635 |  |  | $ | 531,451 |
Adjustments to reconcile Net income to Net cash provided by operating activities: |  |  |  |  |
Depreciation and amortization | 185,715 |  |  | 232,537 |  |  | 264,863 |
Amortization of deferred loan origination costs | 71,142 |  |  | 76,326 |  |  | 81,315 |
Amortization of financing origination fees | 14,435 |  |  | 9,823 |  |  | 8,367 |
Provision for long-term employee benefits | 40,833 |  |  | 13,344 |  |  | 36,481 |
Employee benefit plan contributions and payments | (20,722) |  |  | (13,256) |  |  | (10,544) |
Stock compensation expense | 23,494 |  |  | 33,733 |  |  | 35,539 |
Net change in wholesale finance receivables related to sales | 531,701 |  |  | (5,822) |  |  | (56,538) |
Provision for credit losses | 181,870 |  |  | 134,536 |  |  | 106,870 |
Deferred income taxes | (44,079) |  |  | 21,547 |  |  | (33,981) |
Other, net | 13,826 |  |  | 298 |  |  | 37,554 |
Changes in current assets and liabilities: |  |  |  |  |
Accounts receivable, net | 127,657 |  |  | 44,902 |  |  | 9,143 |
Finance receivables – accrued interest and other | 7,418 |  |  | (11,119) |  |  | 773 |
Inventories, net | 80,858 |  |  | (47,576) |  |  | (31,059) |
Accounts payable and accrued liabilities | (43,087) |  |  | (18,462) |  |  | 196,192 |
Derivative financial instruments | (3,481) |  |  | 1,936 |  |  | 473 |
Other | 9,012 |  |  | (28,110) |  |  | 29,022 |
| 1,176,592 |  |  | 444,637 |  |  | 674,470 |
Net cash provided by operating activities | $ | 1,177,890 |  |  | $ | 868,272 |  |  | $ | 1,205,921 |
Cash paid during the years ended December 31, for interest and income taxes was as follows (in thousands):
| 2020 |  | 2019 |  | 2018
Interest | $ | 245,961 |  |  | $ | 229,678 |  |  | $ | 207,484 |
Income taxes | $ | 30,675 |  |  | $ | 149,828 |  |  | $ | 149,436 |
Interest paid represents interest payments of HDFS and interest payments of the Company, included in Financial Services interest expense and Interest expense on the Consolidated statements of operations.

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