Fair Value Measurements

9 Months Ended

Oct. 02, 2015

Note 2: Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including available-for-sale fixed income securities, trading fixed income and equity securities held in its deferred compensation plan and the liability associated with its deferred compensation plan. There have been no transfers between fair value measurement levels during the nine months ended October 2, 2015 and October 3, 2014. Any transfers between fair value measurement levels would be recorded on the actual date of the event or change in circumstances that caused the transfer. The fair value of these certain financial assets and liabilities was determined using the following inputs at October 2, 2015:

	Fair Value Measurements at Reporting Date Using
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)	Total		(Level 1)		(Level 2)		(Level 3)

Assets
Money market securities ⁽¹⁾	$	3,608	$	3,608	$	-	$	-

Fixed income available- for-sale securities ⁽²⁾		26,837		-		26,837		-

Fixed income trading securities held in deferred compensation plan ⁽³⁾		9,007		9,007		-		-

Equity trading securities held in deferred compensation plan ⁽³⁾		32,277		32,277		-		-
Total	$	71,729	$	44,892	$	26,837	$	-

Liabilities
Deferred compensation plan ⁽⁴⁾		45,038		45,038		-		-
Total	$	45,038	$	45,038	$	-	$	-

⁽¹⁾

Included in cash and cash equivalents on the Company’s unaudited condensed consolidated balance sheet.

⁽²⁾

Included in short-term investments on the Company’s unaudited condensed consolidated balance sheet.

⁽³⁾

Included in prepaid expenses and other assets and deferred compensation plan assets on the Company’s unaudited condensed consolidated balance sheet.

⁽⁴⁾

Included in accrued payroll and employee benefits and deferred compensation on the Company’s unaudited condensed consolidated balance sheet.

The fair value of these certain financial assets and liabilities was determined using the following inputs at January 2, 2015:

	Fair Value Measurements at Reporting Date Using
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)	Total		(Level 1)		(Level 2)		(Level 3)

Assets
Money market securities ⁽¹⁾	$	45,478	$	45,478	$	-	$	-

Fixed income available- for-sale securities ⁽²⁾		24,913		-		24,913		-

Fixed income trading securities held in deferred compensation plan ⁽³⁾		9,672		9,672		-		-

Equity trading securities held in deferred compensation plan ⁽³⁾		34,176		34,176		-		-
Total	$	114,239	$	89,326	$	24,913	$	-

Liabilities
Deferred compensation plan ⁽⁴⁾		45,394		45,394		-		-
Total	$	45,394	$	45,394	$	-	$	-

⁽¹⁾

Included in cash and cash equivalents on the Company’s consolidated balance sheet.

⁽²⁾

Included in short-term investments on the Company’s consolidated balance sheet.

⁽³⁾

Included in prepaid expenses and other assets and deferred compensation plan assets on the Company’s consolidated balance sheet.

⁽⁴⁾

Included in accrued payroll and employee benefits and deferred compensation on the Company’s consolidated balance sheet.

Fixed income available-for-sale securities as of October 2, 2015 and January 2, 2015 represent obligations of state and local government agencies and United States agencies. Fixed income and equity trading securities represent mutual funds held in the Company’s deferred compensation plan. See Note 6 for additional information about the Company’s deferred compensation plan.

Cash, cash equivalents and short-term investments consisted of the following as of October 2, 2015:

	Amortized		Unrealized		Unrealized		Estimated
(In thousands)	Cost		Gains		Losses		Fair Value

Classified as current assets:
Cash	$	120,849	$	-	$	-	$	120,849

Cash equivalents:
Money market securities		3,608		-		-		3,608
Total cash equivalents		3,608		-		-		3,608
Total cash and cash equivalents		124,457		-		-		124,457

Short-term investments:
U.S. agency securities		16,000		14		-		16,014
State and municipal bonds		10,821		3		(1)		10,823
Total short-term investments		26,821		17		(1)		26,837

Total cash, cash equivalents and short-term investments	$	151,278	$	17	$	(1)	$	151,294

Cash, cash equivalents and short-term investments consisted of the following as of January 2, 2015:

	Amortized		Unrealized		Unrealized		Estimated
(In thousands)	Cost		Gains		Losses		Fair Value

Classified as current assets:
Cash	$	84,012	$	-	$	-	$	84,012

Cash equivalents:
Money market securities		45,478		-		-		45,478
Total cash equivalents		45,478		-		-		45,478
Total cash and cash equivalents		129,490		-		-		129,490

Short-term investments:
State and municipal bonds		24,890		27		(4)		24,913
Total short-term investments		24,890		27		(4)		24,913

Total cash, cash equivalents and short-term investments	$	154,380	$	27	$	(4)	$	154,403

The following table summarizes the cost and estimated fair value of short-term fixed income securities classified as short-term investments based on stated effective maturities as of October 2, 2015:

	Amortized		Estimated
(In thousands)	Cost		Fair Value

Due within one year	$	10,821	$	10,823
Due between one and two years		16,000		16,014
Total	$	26,821	$	26,837

At October 2, 2015 and January 2, 2015, the Company did not have any assets or liabilities valued using significant unobservable inputs.

The following financial instruments are not measured at fair value on the Company's consolidated balance sheet at October 2, 2015 and January 2, 2015, but require disclosure of their fair values: accounts receivable, other assets and accounts payable. The estimated fair value of such instruments at October 2, 2015 and January 2, 2015 approximates their carrying value as reported on the consolidated balance sheet.

There were no other-than-temporary impairments or credit losses related to available-for-sale securities during the three and nine months ended October 2, 2015 and October 3, 2014.

- 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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