Fair Value Measurements

3 Months Ended

Apr. 01, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements

4. FAIR VALUE MEASUREMENTS

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following table summarizes, for assets or liabilities measured at fair value, the respective fair value and the classification by level of input within the fair value hierarchy:

			Fair Value Measurement at
			Reporting Date Using
Description	April 1, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In millions)
Other liabilities:
Forward contracts	$	0.6	$	—	$	0.6	$	—
Pension obligation	$	4.5	$	—	$	—	$	4.5

			Fair Value Measurement at
			Reporting Date Using
Description	December 31, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In millions)
Other liabilities:
Forward contracts	$	0.8	$	—	$	0.8	$	—
Pension obligation	$	4.0	$	—	$	—	$	4.0

The estimated fair value of foreign currency forward contracts is based upon quoted market prices obtained from independent pricing services for similar derivative contracts and these financial instruments are characterized as Level 2 assets in the fair value hierarchy.

The estimated fair value of the pension obligation is based on expected years of service and average compensation. The valuation model used to value the pension obligation utilizes mortality rate, inflation, interest rate risks and changes in the life expectancy for pensioners. These assumptions are routinely made in the appraisal process by the independent actuary thus resulted in a Level 3 classification.

There were no transfers from Level 1 or Level 2. Fair value adjustments were noncash, and therefore did not impact the Company’s liquidity or capital resources. Qualitative information about Level 3 fair value measurements is as follows:

	April 1,		Valuation	Unobservable
	2022		Techniques	Input	Range/Multiple
(Dollars in millions, except rate/multiple)
Pension obligation	$	4.5	Projected unit credit method	Discount rate	2.1% to 2.7%
				Rate on return	1.5% to 2.1%
				Salary increase rate	2.0% to 3.0%

Following is a summary of the Level 3 activity:

(In millions)	Pension obligation
As of December 31, 2021	$	4.0
Benefits, payments and other adjustments		0.5
As of April 1, 2022	$	4.5