Fair Value Measurements

3 Months Ended

May 31, 2014

The Company accounts for financial assets and liabilities in accordance with accounting standards that define fair value and establish a framework for measuring fair value. The hierarchy prioritizes the inputs into three broad levels. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. A financial asset’s or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

Financial assets and liabilities measured at fair value as of May 31, 2014 and March 1, 2014, are summarized below:



(In thousands)	Quoted Prices in Active Markets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total Fair Value
May 31, 2014
Cash equivalents
Money market funds	$	8,242	$	—	$	—	$	8,242
Total cash equivalents	8,242		—		—		8,242
Available for sale securities
Municipal bonds	$	—	$	10,798	$	—	$	10,798
Total available for sale securities	—		10,798		—		10,798
Restricted investments
Money market funds	$	1,742	$	—	$	—	$	1,742
Total restricted investments	1,742		—		—		1,742
Mutual fund investments
Mutual funds	$	807	$	—	$	—	$	807
Total mutual fund investments	807		—		—		807
Total assets at fair value	$	10,791	$	10,798	$	—	$	21,589

March 1, 2014
Cash equivalents
Money market funds	$	12,788	$	—	$	—	$	12,788
Total cash equivalents	12,788		—		—		12,788
Available for sale securities
Municipal bonds	$	—	$	11,477	$	—	$	11,477
Total available for sale securities	—		11,477		—		11,477
Restricted investments
Money market funds	$	2,540	$	—	$	—	$	2,540
Total restricted investments	2,540		—		—		2,540
Mutual fund investments
Mutual funds	$	409	$	—	$	—	$	409
Total mutual fund investments	409		—		—		409
Foreign currency instruments
Foreign currency instruments	$	—	$	98	$	—	$	98
Total foreign currency instruments	$	—	$	98	$	—	$	98
Total assets at fair value	$	15,737	$	11,575	$	—	$	27,312

Cash equivalents

Cash equivalents include highly liquid investments with an original maturity of three months or less, and consist primarily of money market funds. The cash equivalents are held at fair value based on quoted market prices, which approximate stated cost.

Available for sale securities

The Company had short-term available-for-sale securities of $0.6 million and long-term available-for-sale securities of $10.2 million as of May 31, 2014, consisting of municipal bonds. All of the Company’s fixed maturity investments are classified as “available for sale,” and are carried at fair market value based on market prices from recent trades of similar securities.

Restricted investments

The Company had $1.7 million of long-term restricted investments, as of May 31, 2014, consisting of money market funds, which are short term in nature but are restricted for future investment in the Company's storefront and entrance business in Michigan, and are, therefore, classified as long term. The restricted investments are held at fair value based on quoted market prices, which approximate stated cost.

Mutual fund investments

The Company had $0.8 million of mutual fund investments as of May 31, 2014 as a long-term funding source for the deferred compensation plan. The mutual fund investments are recorded at estimated fair value, based on quoted market prices, and are included in other non-current assets in the consolidated balance sheet.

Foreign Currency Instruments

The Company had a foreign exchange forward contract in place to hedge against the effect of exchange rate fluctuations on certain forecasted purchases. The forward contract was measured at fair value using readily observable market inputs, such as quotations on forward foreign exchange points and foreign interest rates.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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