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Fair Value Measurements
 9 Months Ended
Jun. 30, 2013
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS
NOTE 14: FAIR VALUE MEASUREMENTS
In accordance with FASB ASC 820-10, Fair Value Measurements and Disclosures, our assets and liabilities, which are carried at fair value, are classified in one of the following three categories:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Other observable inputs other than quoted market prices.
Level 3: Unobservable inputs that are not corroborated by market data.
The tables below present our financial assets that are measured at fair value on a recurring basis as of June 30, 2013 and 2012 and September 30, 2012:
 
 
 
June 30, 2013
 
Fair Value Measurements Using
Financial assets (liabilities or temporary equity):
Level 1
 
Level 2
 
Level 3
 
 
(in thousands)
Marketable equity securities
 
$
2,910

 
$
2,910

 
$
—

 
$
—

Forward contracts
 
2,395

 
—

 
2,395

 
—

Contingent consideration
 
(11,178
)
 
—

 
—

 
(11,178
)
Redeemable noncontrolling interest
 
(56,837
)
 
—

 
—

 
(56,837
)
Net financial assets (liabilities or temporary equity)
 
$
(62,710
)
 
$
2,910

 
$
2,395

 
$
(68,015
)
 
 
 
 
 
 
 
 
 
 
 
June 30, 2012
 
Fair Value Measurements Using
Financial assets (liabilities or temporary equity):
Level 1
 
Level 2
 
Level 3
 
 
(in thousands)
Marketable equity securities
 
$
4,520

 
$
4,520

 
$
—

 
$
—

Contingent consideration
 
(23,270
)
 
—

 
—

 
(23,270
)
Redeemable noncontrolling interest
 
(44,864
)
 
—

 
—

 
(44,864
)
Net financial assets (liabilities or temporary equity)
 
$
(63,614
)
 
$
4,520

 
$
—

 
$
(68,134
)
 
 
 
 
 
 
 
 
 
 
 
September 30, 2012
 
Fair Value Measurements Using
Financial assets (liabilities or temporary equity):
Level 1
 
Level 2
 
Level 3
 
 
(in thousands)
Marketable equity securities
 
$
4,631

 
$
4,631

 
$
—

 
$
—

Contingent consideration
 
(23,432
)
 
—

 
—

 
(23,432
)
Redeemable noncontrolling interest
 
(53,681
)
 
—

 
—

 
(53,681
)
Net financial assets (liabilities or temporary equity)
 
$
(72,482
)
 
$
4,631

 
$
—

 
$
(77,113
)


We measure the value of our marketable equity securities under a Level 1 input. These assets are publicly traded equity securities for which market prices are readily available. There were no transfers of assets in or out of Level 1 or Level 2 fair value measurements in the periods presented. At June 30, 2013 our marketable equity securities were in an unrealized loss position. The aggregate amount of unrealized losses at June 30, 2013 was approximately $1.5 million and we currently believe that the fair value decline is temporary.

Grupo Finmart measures the value of the forward contracts under a Level 2 input. To measure the fair value of the forward contracts, Grupo Finmart used estimations of expected cash flows, appropriately risk-adjusted discount rates and available observable inputs (term of the forward, notional amount, discount rates based on local and foreign rate curves, and a credit value adjustment to consider the likelihood of nonperformance).

We used an income approach to measure the fair value of the contingent consideration using a probability-weighted discounted cash flow approach, in which all outcomes were successful. The significant inputs used for the valuation are not observable in the market, as they are specifically related to Grupo Finmart, and thus this fair value measurement represents a Level 3 measurement within the fair value hierarchy. During three and nine month periods ended June 30, 2013, we recorded accretion expense of $0.1 million and $0.4 million respectively. In April 2013, we paid $12.0 million in contingent consideration to Grupo Finmart's noncontrolling owners. On June 30, 2013 we recorded additional contingent consideration of $0.2 million due to Grupo Finmart's acquisition of a loan portfolio, bringing the contingent consideration liability to $11.2 million. During the three and nine month periods ended June 30, 2012, we recorded accretion expense of $0.3 million to bring the contingent liability to $23.3 million at June 30, 2012. These amounts are included in administrative expenses in our consolidated statement of operations.
The fair value of temporary equity was estimated by applying an income approach and a market approach. This fair value measurement is based on significant inputs that are not observable in the market and thus represents a Level 3 measurement. Key assumptions include discounts for lack of control and lack of marketability that market participants would consider when estimating the fair value of the noncontrolling interest.