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Fair Value Measurements

9 Months Ended

Sep. 28, 2018

Note 3: 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 were no transfers between fair value measurement levels during the three and nine months ended September 28, 2018 and September 29, 2017. 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 September 28, 2018:

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

Assets
Money market securities (1)	$	605	$	605	$	-	$	-

Fixed income available- for-sale securities (2)		81,373		-		81,373		-

Fixed income trading securities held in deferred compensation plan (3)		17,835		17,835		-		-

Equity trading securities held in deferred compensation plan (3)		45,435		45,435		-		-

Total	$	145,248	$	63,875	$	81,373	$	-

Liabilities
Deferred compensation plan (4)		65,036		65,036		-		-

Total	$	65,036	$	65,036	$	-	$	-

(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 December 29, 2017:

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

Assets
Money market securities (1)	$	9,742	$	9,742	$	-	$	-

Fixed income available- for-sale securities (2)		71,604		-		71,604		-

Fixed income trading securities held in deferred compensation plan (3)		13,686		13,686		-		-

Equity trading securities held in deferred compensation plan (3)		39,664		39,664		-		-

Total	$	134,696	$	63,092	$	71,604	$	-

Liabilities
Deferred compensation plan (4)		59,050		59,050		-		-

Total	$	59,050	$	59,050	$	-	$	-

(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.

Fixed income available-for-sale securities as of September 28, 2018 and December 29, 2017 represent obligations of the United States Treasury and United States agencies. Fixed income and equity trading securities represent mutual funds held in the Company’s deferred compensation plan. See Note 7 for additional information about the Company’s deferred compensation plan.

Cash, cash equivalents and short-term investments consisted of the following as of September 28, 2018:

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

Classified as current assets:
Cash	$	120,372	$	-	$	-		$	120,372

Cash equivalents:
Money market securities		605		-		-			605
Total cash equivalents		605		-		-			605
Total cash and cash equivalents		120,977		-		-			120,977

Short-term investments:
U.S. Treasury and agency securities		81,837		-		(464	)		81,373
Total short-term investments		81,837		-		(464	)		81,373

Total cash, cash equivalents and short-term investments	$	202,814	$	-	$	(464	)	$	202,350

Cash, cash equivalents and short-term investments consisted of the following as of December 29, 2017:

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

Classified as current assets:
Cash	$	115,052	$	-	$	-		$	115,052

Cash equivalents:
Money market securities		9,742		-		-			9,742
Total cash equivalents		9,742		-		-			9,742
Total cash and cash equivalents		124,794		-		-			124,794

Short-term investments:
U.S. Treasury and agency securities		71,997		-		(393	)		71,604
Total short-term investments		71,997		-		(393	)		71,604

Total cash, cash equivalents and short-term investments	$	196,791	$	-	$	(393	)	$	196,398

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 September 28, 2018:

	Amortized		Estimated
(In thousands)	Cost		Fair Value

Due within one year	$	39,966	$	39,796
Due between one and two years		41,871		41,577
Total	$	81,837	$	81,373

At September 28, 2018 and December 29, 2017, 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 unaudited condensed consolidated balance sheet at September 28, 2018 and December 29, 2017, but require disclosure of their fair values: accounts receivable, other assets and accounts payable. The estimated fair value of such instruments at September 28, 2018

and

December 29, 2017

approximates their carrying value as reported on the

Company’s

unaudited condensed 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 September 28, 2018 and September 29, 2017.

- 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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