Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2012

Fair Value of Financial Instruments [Abstract]

Fair Value of Financial Instruments

Note 9—Fair Value of Financial Instruments

The following table summarizes the valuation of Hallwood Group’s financial instruments based upon the inputs used to measure fair value in the three levels of the fair value hierarchy as of September 30, 2012 and December 31, 2011.

• Level 1 – Quoted market prices in active markets for identical assets or liabilities

• Level 2 – Quoted prices for similar assets or liabilities in active markets or inputs that are observable

• Level 3 – Inputs that are unobservable

	September 30, 2012
	Level 1		Level 2		Level 3
Cash Equivalents
Money market funds	$	49	$	—	$	—
	December 31, 2011
	Level 1		Level 2		Level 3
Cash Equivalents
Money market funds	$	5,248	$	—	$	—

Money market funds are classified as Level 1 instruments as they are traded in active markets with sufficient volume and frequency of transactions.

The fair value of financial instruments that are short-term or reprice frequently and have a history of negligible credit losses are considered to approximate their carrying value. These include cash, short term receivables, accounts payable, the HFL Loan and other liabilities. In addition, because the interest rate on the revolving credit facility is variable, the fair value approximates its carrying value.