Fair Value Measurements

12 Months Ended

Dec. 31, 2013

Fair Value Measurements

Fair Value Measurements

Note 9—Fair Value Measurements

        Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value may be measured using three levels of inputs:

• Level 1—quoted prices in active markets for identical assets and liabilities.

  Level 2—observable inputs other than quoted prices in active markets for identical assets and liabilities.

  Level 3—unobservable inputs in which there is little or no market data available, which requires the reporting entity to develop its own assumptions.

Recurring Measurements

        The fair value of the Company's financial assets and liabilities measured at fair value on a recurring basis were as follows:

In millions	Balance at December 31, 2013		Quoted Prices In Active Markets for Identical Assets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3
Cash and cash equivalents	$	754.5	$	754.5	$	—	$	—
Short-term investments		1.4		1.4		—		—
Foreign currency forward contracts		0.2		—		0.2		—
Total assets measured at fair value	$	756.1	$	755.9	$	0.2	$	—

        Cash and cash equivalents include $3.6 million of money market accounts for the Company's Deferred Compensation Plan. Short-term investments of $1.4 million at December 31, 2013 consist of investments held in mutual funds for the Company's Deferred Compensation Plan and are classified in the consolidated balance sheet at December 31, 2013 in Prepaid expenses and other current assets.

        Foreign exchange forward contracts at December 31, 2013 relate to contracts held for purposes of mitigating the Company's exposure to fluctuations in foreign exchange rates, resulting from assets or liabilities that are held by certain of its operating subsidiaries in currencies other than the subsidiary's functional currency. Such forward contracts are valued at fair value using observable market inputs such as forward prices and spot prices of the underlying exchange rate pair. Based on these inputs, the derivative assets and liabilities are classified within Level 2 of the valuation hierarchy. The Company has not designated these forward contracts as cash flow hedges and, accordingly, recognizes associated changes in fair value of the forwards through Other income (expense). The fair value of these contracts is recorded within Other current assets in the consolidated balance sheet as of December 31, 2013 as none of the contract terms exceed one year from the balance sheet date.

In millions	Balance at December 31, 2012		Quoted Prices In Active Markets for Identical Assets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3
Cash and cash equivalents	$	112.5	$	112.5	$	—	$	—
Short-term investments		0.6		0.6		—		—
Commodity swap agreements		0.1		—		0.1		—
Foreign currency forward contracts		0.3		—		0.3		—
Total assets measured at fair value	$	113.5	$	113.1	$	0.4	$	—
Contingent consideration		9.9		—		—		9.9
Total liabilities measured at fair value	$	9.9	$	—	$	—	$	9.9

        Cash and cash equivalents at December 31, 2012 include $1.6 million in money market accounts for the Company's Deferred Compensation Plan. Short-term investments of $0.6 million at December 31, 2012 consist of investments held in mutual funds for the Company's deferred compensation program and are classified in the condensed consolidated balance sheet at December 31, 2012 in Prepaid expenses and other current assets.

        Commodity swap agreements at December 31, 2012 relate to swap agreements held for purposes of mitigating the Company's exposure to fluctuations in the prices of silver and copper, which are key raw materials within the Interconnect Technologies segment. Such swaps are valued using third-party valuation models that measure fair value using observable market inputs such as forward prices and spot prices of the underlying commodities. Based on these inputs, the derivative assets and liabilities are classified within Level 2 of the valuation hierarchy. The Company has not designated these swaps as cash flow hedges and, accordingly, recognizes associated changes in fair value of the swaps through Other income (expense). The fair value of these swaps is recorded within Prepaid expenses and other current assets in the consolidated balance sheet as of December 31, 2012 as none of the swap terms exceed one year from the balance sheet date. The swaps expired on December 31, 2013.

        Contingent consideration represents fair value of the earn-out associated with the purchase of PDT and was estimated using a discounted cash flow model based on financial projections of the acquired company. During the fourth quarter of 2013 the earn-out was settled for or €7.0 million, or $9.5 million, upon agreement by both parties. See Note 3 for further information regarding the PDT acquisition.

        See Note 14 regarding the fair value of the Company's Borrowings and Note 15 regarding fair value measurements related to the Company's Retirement Plans.

• Non-Recurring Measurements

        During the second quarter of 2013, the Company recognized a goodwill impairment charge of $100.0 million, reducing the carrying value of goodwill associated with the former Transportation Products reporting unit to $0. The estimated fair value of goodwill was determined using the residual value method as required by ASC 350, Goodwill and Other Intangible Assets. This estimate was based on fair value determinations using Level 3 inputs. See Note 12 for information regarding this impairment.

        During the year ended December 31, 2012, the FoodService Products segment measured long-lived assets on a non-recurring basis at certain facilities resulting in an impairment charge of $3.5 million, which was included in Other expense (income). These measurements were based on fair value determination of certain long-lived assets within the FoodService Products segment using Level 3 inputs. See Note 5 for information regarding asset impairment within the FoodService Products segment.

        During the year ended December 31, 2011 there were no non-recurring fair value measurements subsequent to initial recognition. See Note 3 for information regarding assets acquired and liabilities assumed in the Thermax/Raydex, Hertalan, Tri-Star, PDT and Hawk acquisitions measured at fair value during the initial measurement period.