Fair Value

9 Months Ended

Jul. 02, 2022

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

Fair value is defined as the price 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. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate fair value. The definition of the fair value hierarchy is as follows:

Level 1 – Quoted prices in active markets for identical assets and liabilities.

Level 2 – Observable inputs other than quoted prices in active markets for similar assets and liabilities.

Level 3 – Inputs for which significant valuation assumptions are unobservable in a market and therefore value is based on the best available data, some of which is internally developed and considers risk premiums that a market participant would require.

Our derivatives are valued using various pricing models or discounted cash flow analyses that incorporate observable market data, such as interest rate yield curves and currency rates, and are classified as Level 2 within the valuation hierarchy.

The following table presents the fair values and classification of our financial assets and liabilities measured on a recurring basis, all of which are classified as Level 2, except for the acquisition contingent consideration, which is classified as Level 3:

	Balance Sheets location	July 2, 2022		October 2, 2021
Foreign currency contracts	Other current assets	$	593	$	551
Foreign currency contracts	Other assets	227		104
	Total assets	$	820	$	655
Foreign currency contracts	Accrued liabilities and other	$	3,743	$	1,715
Foreign currency contracts	Other long-term liabilities	598		537
Acquisition contingent consideration	Accrued liabilities and other	1,018		—
Acquisition contingent consideration	Other long-term liabilities	2,160		—
	Total liabilities	$	7,519	$	2,252

The changes in financial liabilities classified as Level 3 within the fair value hierarchy are as follows:

	Three Months Ended				Nine Months Ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Balance at beginning of period	$	3,084	$	—	$	—	$	—
Additions from acquisitions	—		—		3,053		—
Increase in discounted future cash flows recorded as interest expense	94		—		125		—
Balance at end of period	$	3,178	$	—	$	3,178	$	—

Our only financial instrument for which the carrying value differs from its fair value is long-term debt. At July 2, 2022, the fair value of long-term debt was $793,705 compared to its carrying value of $862,058. The fair value of long-term debt is classified as Level 2 within the fair value hierarchy and was estimated based on quoted market prices.

Property, plant and equipment, inventories and receivables have been measured at fair values on a nonrecurring basis using future discounted cash flows and other observable inputs (Level 3) and are not included in the fair value tables above. Impairment losses for the three and nine months ended July 2, 2022 of $894 and $17,835, respectively, are recorded as a result of these measurements and are described in Note 4 - Receivables, Note 5 - Inventories and Note 6 - Property, Plant and Equipment.