INSPERITY, INC. 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are primarily exposed to market risks from fluctuations in interest rates and the effects of those fluctuations on the market values of our cash equivalent short-term investments and our available-for-sale marketable securities. In addition, borrowings under our Facility bear interest at a variable market rate. As of December 31, 2023, we had outstanding letters of credit and borrowings totaling $370.4 million under the Facility. Please read Note 6 to the Consolidated Financial Statements, “Long-Term Debt,” for additional information. Our cash equivalent short-term investments consist primarily of overnight investments, which are not significantly exposed to interest rate risk, except to the extent that changes in interest rates will ultimately affect the amount of interest income earned on these investments. Our available-for-sale marketable securities are subject to interest rate risk because these securities generally include a fixed interest rate. As a result, the market values of these securities are affected by changes in prevailing interest rates. We attempt to limit our exposure to interest rate risk primarily through diversification and low investment turnover. Our investment policy is designed to maximize after-tax interest income while preserving our principal investment. As a result, our marketable securities consist of tax-exempt short and intermediate-term debt securities, which are primarily U.S. Treasury bills, as well as pre-refunded municipal bonds that are secured by escrow funds containing U.S. Government Securities. Item 8. Financial Statements and Supplementary Data. The information required by this Item 8 is contained in a separate section of this Annual Report. See “ Index to Consolidated Financial Statements .” 58 2023 Form 10-K DISCLOSURE CONTROLS AND PROCEDURES Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.