XML 45 R15.htm IDEA: XBRL DOCUMENT v3.2.0.727
Fair Value Measurements
 6 Months Ended
Jun. 28, 2015
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements:
The FASB Accounting Standards Codification (ASC) relating to fair value measurements emphasizes that fair value is a market-based measurement that should be determined based on assumptions (inputs) that market participants would use in pricing an asset or liability. Inputs may be observable or unobservable, and valuation techniques used to measure fair value should maximize the use of relevant observable inputs and minimize the use of unobservable inputs. Accordingly, the FASB’s ASC establishes a hierarchal disclosure framework that ranks the quality and reliability of information used to determine fair values. The hierarchy is associated with the level of pricing observability utilized in measuring fair value and defines three levels of inputs to the fair value measurement process. Quoted prices are the most reliable valuation inputs, whereas model values that include inputs based on unobservable data are the least reliable. Each fair value measurement must be assigned to a level corresponding to the lowest level input that is significant to the fair value measurement in its entirety.
The three broad levels of inputs defined by the fair value hierarchy are as follows:
 
•
Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
 
•
Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
 
•
Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement.
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The table below presents the balances of assets and liabilities measured at fair value as of June 28, 2015, December 31, 2014, and June 29, 2014 on a recurring basis as well as the fair values of other financial instruments:
(In thousands)
Condensed 
Consolidated
Fair Value
June 28, 2015
 
December 31, 2014
 
June 29, 2014
Balance Sheet Location
Hierarchy Level
Carrying Value
Fair 
Value
 
Carrying Value
Fair 
Value
 
Carrying Value
Fair 
Value
Financial assets (liabilities) measured on a recurring basis:
 
 
 
 
 
 
 
 
 
 
Interest rate swap agreements not designated as cash flow hedges
Current derivative liability
Level 2
(6,895
)
(6,895
)
 
(11,791
)
(11,791
)
 
—

—

Interest rate swap agreements not designated as cash flow hedges
Derivative Liability
Level 2
—

—

 
—

—

 
(18,831
)
(18,831
)
Interest rate swap agreements designated as cash flow hedges
Derivative Liability
Level 2
(18,806
)
(18,806
)
 
(14,649
)
(14,649
)
 
(11,279
)
(11,279
)
Other financial assets (liabilities):
 
 
 
 
 
 
 
 
 
 
Term debt
Long-Term Debt
Level 2
(608,850
)
(610,372
)
 
(608,850
)
(605,806
)
 
(615,825
)
(618,904
)
March 2013 notes
Long-Term Debt
Level 1
(500,000
)
(513,750
)
 
(500,000
)
(501,250
)
 
(500,000
)
(513,750
)
June 2014 notes
Long-Term Debt
(1) 
(450,000
)
(455,625
)
 
(450,000
)
(451,125
)
 
(450,000
)
(455,625
)
(1)
The June 2014 notes were based on Level 1 inputs as of June 28, 2015 and Level 2 inputs as of both December 31, 2014 and June 29, 2014.
Fair values of the interest rate swap agreements are determined using significant inputs, including the LIBOR forward curves, which are considered Level 2 observable market inputs. In addition, the Partnership considered the effect of its credit and non-performance risk on the fair values provided, and recognized an adjustment decreasing the net derivative liability by approximately $0.7 million as of June 28, 2015 and by approximately $0.8 million as of both December 31, 2014, and June 29, 2014.
The carrying value of cash and cash equivalents, revolver, accounts receivable, current portion of term debt, accounts payable, and accrued liabilities approximates fair value because of the short maturity of these instruments. There were no assets measured at fair value on a non-recurring basis at June 28, 2015, December 31, 2014, or June 29, 2014.