Fair Value Of Financial Assets And Liabilities

12 Months Ended

Mar. 31, 2013

Fair Value Disclosures [Abstract]

Fair Value Of Financial Assets And Liabilities

FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

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. Assets and liabilities recorded at fair value are classified based upon the level of judgment associated with the inputs used to measure their fair value. The hierarchical levels related to the subjectivity of the valuation inputs are defined as follows:

• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities at the measurement date.

• Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable, directly or indirectly through corroboration with observable market data at the measurement date.

• Level 3 inputs are unobservable inputs that reflect management’s best estimate of the assumptions (including assumptions about risk) that market participants would use in pricing the asset or liability at the measurement date.

The carrying value of cash, trade receivables, other current receivables, trade payables and other current liabilities (e.g., deposit liabilities, cash overdrafts, etc.) approximates fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis at March 31, 2013 and 2012 are categorized in the tables below based on the lowest level of significant input to the valuation. During the periods presented, there were no transfers between fair value hierarchical levels.

	Balance at		Quoted prices in active markets Level 1		Significant other observable inputs Level 2		Significant unobservable inputs Level 3
(In thousands)	March 31, 2013
Assets:
Deferred compensation plan assets	$	13,631	$	13,631	$	—	$	—
Derivative assets - variable interest rate swap agreements	2,490		—		2,490		—
Total assets measured at fair value on a recurring basis	$	16,121	$	13,631	$	2,490	$	—
Liabilities:
Deferred compensation plan liabilities	$	13,631	$	13,631	$	—	$	—
Contingent consideration liabilities	3,632		—		—		3,632
Total liabilities measured at fair value on a recurring basis	$	17,263	$	13,631	$	—	$	3,632

	Balance at		Quoted prices in active markets Level 1		Significant other observable inputs Level 2		Significant unobservable inputs Level 3
(In thousands)	March 31, 2012
Assets:
Deferred compensation plan assets	$	11,126	$	11,126	$	—	$	—
Derivative assets - variable interest rate swap agreements	6,734		—		6,734		—
Total assets measured at fair value on a recurring basis	$	17,860	$	11,126	$	6,734	$	—
Liabilities:
Deferred compensation plan liabilities	$	11,126	$	11,126	$	—	$	—
Contingent consideration liabilities	2,512		—		—		2,512
Total liabilities measured at fair value on a recurring basis	$	13,638	$	11,126	$	—	$	2,512

The following is a general description of the valuation methodologies used for financial assets and liabilities measured at fair value:

Deferred compensation plan assets and corresponding liabilities — The Company’s deferred compensation plan assets consist of open-ended mutual funds (Level 1) and are included within other non-current assets on the Consolidated Balance Sheets. The Company’s deferred compensation plan liabilities are equal to the plan’s assets and are included within other non-current liabilities on the Consolidated Balance Sheets. Gains or losses on the deferred compensation plan assets are recognized as other income, net, while gains or losses on the deferred compensation plan liabilities are recognized as compensation expense in the Consolidated Statements of Earnings.

Derivative assets — interest rate swap agreements — The Company’s variable interest rate swap agreements are with highly rated counterparties, are designated as fair value hedges and effectively convert the Company’s fixed rate 2013 Notes to variable rate debt. The swap agreements are valued using an income approach that relies on observable market inputs such as interest rate yield curves and treasury spreads (Level 2). Expected future cash flows are converted to a present value amount based upon market expectations of the changes in these interest rate yield curves. The fair values of the Company’s interest rate swap agreements are included in prepaid expenses and other current assets as of March 31, 2013 and in other non-current assets as of March 31, 2012 on the Consolidated Balance Sheets. See Note 10 for additional derivatives disclosures.

Contingent consideration liabilities — As part of the consideration for an acquisition, the Company has arrangements in place whereby future consideration in the form of cash may be transferred to the sellers contingent upon the achievement of certain earnings targets. The fair values of the contingent consideration arrangements were estimated using the income approach with inputs that are not observable in the market. Key assumptions for each arrangement, as applicable, include a discount rate commensurate with the level of risk of achievement, time horizon and other risk factors, and probability adjusted earnings growth, all of which the Company believes are appropriate and representative of market participant assumptions. Of the total liability for the contingent consideration arrangements at March 31, 2013, $1.3 million is included within other non-current liabilities while the remainder is included within accrued expenses and other current liabilities on the Consolidated Balance Sheets. The impact on the Company’s earnings as a result of the contingent consideration arrangements for the years ended March 31, 2013 and 2012 was immaterial.

Changes in the fair value of recurring fair value measurements using significant unobservable inputs (Level 3) for the years endedMarch 31, 2013 and 2012 were as follows (in thousands):

Balance at March 31, 2011	$	—
Contingent consideration liabilities recorded	2,450
Settlements made during the period	—
Adjustments to fair value measurement	62
Balance at March 31, 2012	$	2,512
Contingent consideration liabilities recorded	1,750
Settlements made during the period	(669		)
Adjustments to fair value measurement	39
Balance at March 31, 2013	$	3,632

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain assets and liabilities are measured at fair value on a nonrecurring basis in periods subsequent to initial recognition. Assets measured at fair value on a nonrecurring basis during the years ended March 31, 2013 and 2012 are categorized in the tables below based on the lowest level of significant input to the valuation. There were no liabilities measured at fair value on a nonrecurring basis during the years ended March 31, 2013 and 2012.

	Quoted prices in active markets Level 1		Significant other observable inputs Level 2		Significant unobservable inputs Level 3		Total losses (year ended March 31, 2013
(In thousands)
Assets:
Other intangible assets	$	—	$	—	$	535	$	1,729
Total assets measured at fair value on a non-recurring basis	$	—	$	—	$	535	$	1,729

	Quoted prices in active markets Level 1		Significant other observable inputs Level 2		Significant unobservable inputs Level 3		Total losses (year ended March 31, 2012)
(In thousands)
Assets:
Long-lived assets held and used	$	—	$	—	$	9,165	$	4,250
Total assets measured at fair value on a non-recurring basis	$	—	$	—	$	9,165	$	4,250

In June 2012, the Company re-evaluated the economic viability of a small hospital piping construction business (see Note 7). As a result of an impairment analysis performed on the long-lived assets at this reporting unit, the Company recorded a charge of $1.7 million related to certain of the intangible assets associated with this business during the year ended March 31, 2013, which was reflected in the “Restructuring and other special charges, net” line item of the Company’s consolidated Statement of Earnings for the year ended March 31, 2013. The Company used a variation of the income approach, namely the excess earnings method, to estimate the fair value of the intangible assets associated with the business. Under this approach, an intangible asset’s fair value is estimated to be the present value of the incremental after-tax cash flows attributable solely to the intangible asset over its remaining useful life. Key inputs in this model include the cash flow forecast, discount rate, contributory asset charges and tax amortization benefits. As of the evaluation date, the remeasured other intangible assets related to this reporting unit totaled $0.5 million.

In September 2011, the Company performed an evaluation of the recoverability of the fixed assets related to one of its liquid carbon dioxide plants. This evaluation was based upon the receipt of notice that a supplier’s hydrogen plant, which generates carbon dioxide as a by-product that serves as the feedstock for the Company’s co-located liquid carbon dioxide plant, will cease operations in calendar year 2013. In addition, in March 2012, the Company performed an evaluation of the recoverability of the fixed assets related to one of its smaller and less efficient air separation units. The evaluation was based on the re-evaluation of the plan for the operation of the air separation unit over the long-term. See Note 23 for additional details.

As a result of the analyses, the Company remeasured the fixed assets of its liquid carbon dioxide plant and recognized an impairment charge of $2.5 million, and remeasured the fixed assets related to the air separation unit and recognized an impairment charge of $1.8 million, both of which were reflected in the “Restructuring and other special charges, net” line item of the Company’s Consolidated Statements of Earnings. The remeasured plant fixed assets totaled $8.8 million and the remeasured fixed assets related to the air separation unit totaled $0.4 million, at each respective date of evaluation. The Company used an income approach to estimate the fair values of the plant and air separation unit fixed assets based on significant unobservable inputs (Level 3). Factors such as expected future revenues and margins, the likelihood of asset redeployment and the length of the remaining operating term were considered in determining the future cash flows of the fixed assets at both the plant and air separation unit. The asset groups will not be remeasured at fair value on a recurring basis; however, they are still subject to fair value measurements to test for recoverability of the carrying amounts should future conditions warrant an evaluation.

Fair Value of Debt

The carrying value of debt, which is reported on the Company’s Consolidated Balance Sheets, generally reflects the cash proceeds received upon its issuance, net of subsequent repayments, plus the impact of the Company’s fair value hedges. The fair value of the Company’s variable interest rate revolving credit borrowings disclosed in the table below was estimated based on observable forward yield curves and credit spreads management believes a market participant would assume for these facilities under market conditions as of the balance sheet date (Level 2). The fair values of the fixed rate notes disclosed below were determined based on quoted prices from the broker/dealer market, observable market inputs for similarly termed treasury notes adjusted for the Company’s credit spread and inputs management believes a market participant would use in determining imputed interest for obligations without a stated interest rate (Level 2). The fair values of the securitized receivables and the commercial paper approximate their carrying values.

	Carrying Value at		Fair Value at		Carrying Value at		Fair Value at
(In thousands)	March 31, 2013		March 31, 2013		March 31, 2012		March 31, 2012
Commercial paper	$	—	$	—	$	388,452	$	388,452
Trade receivables securitization	295,000		295,000		295,000		295,000
Revolving credit borrowings	44,077		44,077		49,810		49,810
2013 Notes	302,466		303,413		306,677		314,881
2014 Notes	399,856		421,582		399,760		429,530
2015 Notes	249,811		263,702		249,736		260,325
2016 Notes	249,778		262,954		249,708		257,821
2018 Notes	324,471		325,401		—		—
2020 Notes	274,706		274,432		—		—
2022 Notes	249,732		248,404		—		—
2018 Senior Subordinated Notes	215,446		229,381		215,446		234,836
Other long-term debt	2,475		2,603		6,150		6,410
Total debt	$	2,607,818	$	2,670,949	$	2,160,739	$	2,237,065