Fair Value Measurement

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurement

6. FAIR VALUE MEASUREMENT

Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are classified in one of three categories described below.

· Level 1 — Quoted prices in active markets for identical assets or liabilities.

· Level 2 — Inputs, other than quoted market prices in active markets, that are observable either directly or indirectly. Quoted prices for similar instruments in active markets or model driven valuations in which all significant inputs and significant value drivers are observable in active markets.

· Level 3 — Valuations derived from valuations techniques in which one or more significant inputs or significant value drivers are unobservable.

There have been no transfers of assets or liabilities between the fair value measurement classifications during the year ended December 31, 2015.

The following tables set forth our assets and liabilities that are measured at fair value on a recurring basis as of December 31:

	As of December 31, 2015
(in thousands)	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	80,944	$	80,944	$	-	$	-
Derivative asset		615		-		615		-
Total assets	$	81,559	$	80,944	$	615	$	-
Temporary equity-
Redeemable non-controlling interests	$	99,000	$	-	$	-	$	99,000

	As of December 31, 2014
(in thousands)	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents	$	738,090	$	738,090	$	-	$	-
Derivative asset		86		-		86		-
Total assets	$	738,176	$	738,090	$	86	$	-
Temporary equity-
Redeemable non-controlling interests	$	96,251	$	-	$	-	$	96,251

Derivatives include free-standing foreign currency forward contracts, which are marked to market at each reporting period. We classify our foreign currency forward contracts as Level 2, as the valuation inputs are based on quoted prices and market observable data of similar instruments.

We determine the fair market value of the redeemable non-controlling interest using a combination of a discounted cash flow valuation model and a market approach that applies revenues and EBITDA estimates against the calculated multiples of comparable companies. Operating revenues and EBITDA are key assumptions utilized in both the discounted cash flow valuation model and the market approach. The selected discount rate of approximately 10.5 percent is also a key assumption in our discounted cash flow valuation model (See Note 16—Redeemable Non-controlling Interests and Non-controlling Interest). Subsequent to year end we agreed to pay the non-controlling interest owner $99.0 million to acquire the 35.0 percent outstanding share of our redeemable non-controlling interest in Travel Channel (see Note 24 – Subsequent Events).

The following table summarizes the activity for account balances whose fair value measurements are estimated utilizing level 3 inputs:

(in thousands)	As of December 31,
Redeemable Non-controlling Interests	2015			2014
Beginning period balance	$	96,251		$	133,000
Dividends paid to non-controlling interests		(12,985	)		(27,563	)
Net (loss) income		(2,760	)		9,679
Additions to non-controlling interests		700			-
Fair value adjustments		17,794			(18,865	)
Ending period balance	$	99,000		$	96,251

The net income amounts reflected in the table above are reported within net income attributable to non-controlling interests in our consolidated statements of operations.

Other Financial Instruments

The carrying values of our financial instruments do not materially differ from their estimated fair values as of December 31, 2015 and December 31, 2014 except for debt, which is disclosed in Note 13 – Debt.

Non-Recurring Measurements

The majority of the Company’s non-financial instruments, which include goodwill and other intangible assets and property and equipment, are not required to be carried at fair value on a recurring basis. However, if certain triggering events occur, or at least annually for goodwill, such that a non-financial instrument is required to be evaluated for impairment, a resulting asset impairment would require that the non-financial instrument be recorded at the lower of cost or fair value.