Note 8. Fair Value (Tables)

6 Months Ended

Dec. 31, 2016

Fair Value Measurements, Recurring, Valuation Techniques

The following methods and assumptions were used to measure fair value:



Financial Instrument	Level	Valuation Technique/Inputs Used
Cash Equivalents: Money market funds	1	Market - Quoted market prices
Cash Equivalents: Commercial paper	2	Market - Based on market data which use evaluated pricing models and incorporate available trade, bid, and other market information.
Available-for-sale securities: Secondary market certificates of deposit	2	Market - Based on market data which use evaluated pricing models and incorporate available trade, bid, and other market information.
Available-for-sale securities: Municipal bonds	2	Market - Based on market data which use evaluated pricing models and incorporate available trade, bid, and other market information.
Trading securities: Mutual funds held in nonqualified SERP	1	Market - Quoted market prices
Derivative Assets: Stock warrants	3	Market - Stock warrants are analyzed for reasonableness on a quarterly basis. The privately-held company is currently in an early stage of start-up. The pricing of recent purchases or sales of the investment are considered, as well as positive and negative qualitative evidence, in the assessment of fair value.

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

As of December 31, 2016 and June 30, 2016, the fair values of financial assets that are measured at fair value on a recurring basis using the market approach were as follows:



(Amounts in Thousands)	December 31, 2016
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents: Money market funds	$	37,970	$	—	$	—	$	37,970
Cash equivalents: Commercial paper	—		11,026		—		11,026
Available-for-sale securities: Secondary market certificates of deposit	—		9,397		—		9,397
Available-for-sale securities: Municipal bonds	—		9,408		—		9,408
Trading Securities: Mutual funds in nonqualified SERP	10,548		—		—		10,548
Derivatives: Stock warrants	—		—		750		750
Total assets at fair value	$	48,518	$	29,831	$	750	$	79,099

(Amounts in Thousands)	June 30, 2016
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents: Money market funds	$	45,880	$	—	$	—	$	45,880
Trading Securities: Mutual funds in nonqualified SERP	10,001		—		—		10,001
Total assets at fair value	$	55,881	$	—	$	—	$	55,881

Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques

Financial instruments that are not reflected in the Condensed Consolidated Balance Sheets at fair value that have carrying amounts which approximate fair value include the following:



Financial Instrument	Level	Valuation Technique/Inputs Used
Notes receivable	2	Market - Price approximated based on the assumed collection of receivables in the normal course of business, taking into account the customer’s non-performance risk
Non-marketable equity securities (cost-method investments, which carry shares at cost except in the event of impairment)	3	Cost Method, with Impairment Recognized Using a Market-Based Valuation Technique - See the explanation below the table regarding the method used to periodically estimate the fair value of cost-method investments.
Long-term debt (carried at amortized cost)	3	Income - Price estimated using a discounted cash flow analysis based on quoted long-term debt market rates, taking into account Kimball’s non-performance risk