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Fair Value Measurements
12 Months Ended
Dec. 31, 2015
Fair Value Measurements [Abstract]  
Fair Value Measurements

9. FAIR VALUE MEASUREMENTS

 

Recurring Fair Value Measurements

 

GAAP provides for a fair value hierarchy that prioritizes the inputs to the valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs are inputs other than quoted market prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. See Note 3 –Summary of Significant Accounting Policies for additional detail regarding Crocs’ fair value measurement determinations.

 

As of December 31, 2015 and 2014, Crocs’ assets and liabilities subject to fair value measurements consisted of cash equivalents of $7.5 million and $23.3 million, respectively, which are Level 1 assets, and foreign currency derivative liabilities of $0.1 million and $0.0 million, respectively, which are Level 2 assets. The Company’s Level 1 assets are classified in the consolidated balance sheets as ‘Cash and cash equivalents’ and ‘Prepaid expenses and other assets’ and the Level 2 assets are classified in the consolidated balance sheets as ‘Accrued expenses and other liabilities’.

 

Non-Recurring Fair Value Measurements

 

The majority of the Company’s non-financial instruments, which include inventories, property and equipment, and intangible assets, are not required to be carried at fair value on a recurring basis. However, if certain triggering events occur such that a non-financial instrument is required to be evaluated for impairment and the carrying value is not recoverable, the carrying value would be adjusted to the lower of its cost or fair value and an impairment charge would be recorded. See Note 5 – Property and Equipment and Note 6 – Goodwill & Intangible Assets for discussions on impairment charges recorded during the periods presented.