Fair Value Measurements

3 Months Ended

May 04, 2024

Note 5 - Fair Value Measurements

Financial Instruments

The following table presents financial instruments that are measured at fair value on a recurring basis at May 4, 2024, February 3, 2024 and April 29, 2023:


	Fair Value Measurements
(In thousands)	Level 1		Level 2		Level 3		Total
As of May 4, 2024
Cash equivalents - money market mutual funds	$	40,588	$	0	$	0	$	40,588
Marketable securities - mutual funds that fund deferred compensation		12,555		0		0		12,555
Total	$	53,143	$	0	$	0	$	53,143
As of February 3, 2024
Cash equivalents - money market mutual funds	$	91,733	$	0	$	0	$	91,733
Marketable securities - mutual funds that fund deferred compensation		12,247						12,247
Total	$	103,980	$	0	$	0	$	103,980
As of April 29, 2023
Cash equivalents - money market mutual funds	$	29,456	$	0	$	0	$	29,456
Marketable securities - mutual funds that fund deferred compensation		11,535						11,535
Total	$	40,991	$	0	$	0	$	40,991

We invest in publicly traded mutual funds with readily determinable fair values. These Marketable Securities are designed to mitigate volatility in our Consolidated Statements of Income associated with our non-qualified deferred compensation plan. As of May 4, 2024, these Marketable Securities were principally invested in equity-based mutual funds, consistent with the allocation in our deferred compensation plan. To the extent there is a variation in invested funds compared to the total non-qualified deferred compensation plan liability, such fund variance is managed through a stable value mutual fund. We classify these Marketable Securities as current assets because we have the ability to convert the securities into cash at our discretion and these Marketable Securities are not held in a rabbi trust. Changes in these Marketable Securities and deferred compensation plan liabilities are charged to Selling, General and Administrative Expenses.

Deferred Compensation Plan Liabilities and Related Marketable Securities

The following tables present the balances and activity of the Company’s deferred compensation plan liabilities and related Marketable Securities:


(In thousands)	May 4, 2024		February 3, 2024		April 29, 2023
Deferred compensation plan current liabilities	$	183	$	114	$	1,921
Deferred compensation plan long-term liabilities		12,157		11,639		9,809
Total deferred compensation plan liabilities	$	12,340	$	11,753	$	11,730
Marketable securities - mutual funds that fund deferred compensation	$	12,555	$	12,247	$	11,535


(In thousands)	Thirteen Weeks Ended May 4, 2024			Thirteen Weeks Ended April 29, 2023
Deferred compensation liabilities
Employer contributions, net	$	81		$	96
Investment earnings (losses)		323			(3	)
Marketable Securities
Mark-to-market (gains) losses (1)		(308	)		66
Net deferred compensation expense	$	96		$	159

(1) Included in the mark-to-market activity, we recognized unrealized gains of $292,000 and $299,000 related to equity securities still held at May 4, 2024 and April 29, 2023, respectively.

The fair values of Cash and Cash Equivalents, Accounts Receivable, Accounts Payable and Accrued and Other Liabilities approximate their carrying values because of their short-term nature.

Long-Lived Asset Impairment Testing

We periodically evaluate our long-lived assets for impairment if events or circumstances indicate that the carrying value may not be recoverable. The carrying value of long-lived assets is considered impaired when the carrying value of the assets exceeds the expected future cash flows to be derived from their use. Assets are grouped, and the evaluation is performed, at the lowest level for which there are identifiable cash flows, which is generally at a store level. Store level asset groupings typically include Property and Equipment and Operating Lease Right-of-Use Assets, net of the current and long-term portions of Operating Lease Liabilities. Assets subject to impairment are adjusted to estimated fair value and, if applicable, an impairment loss is recorded in Selling, General and Administrative Expenses. If the Operating Lease Right-of-Use Asset is impaired, we would amortize the remaining right-of-use asset on a straight-line basis over the remaining lease term. No impairment charges were recorded during the thirteen weeks ended May 4, 2024 or the thirteen weeks ended April 29, 2023.

- 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.

+ References + Details