Fair Value Measurements

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Fair value measurements

FAIR VALUE MEASUREMENTS

ASC Topic 820 emphasizes that fair value is a market-based measurement, not an entity specific measurement. Therefore, a fair value measurement should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC Topic 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair values as follows:

Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets;

Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Assets and liabilities measured at fair value are based on one or more of the following three valuation techniques noted in ASC Topic 820:

A. Market approach: Prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business.

B. Cost approach: Amount that would be required to replace the service capacity of an asset (replacement cost).

C. Income approach: Techniques to convert future amounts to a single present amount based upon market expectations (including present value techniques, option-pricing and excess earnings models).

The following tables classify assets and liabilities measured at fair value on a recurring basis as of December 31, 2018 and 2017:

			Basis of fair value measurements
	Balance at December 31, 2018		Quoted prices in active markets for identical items (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Valuation technique
(millions of dollars)
Assets:
Foreign currency contracts	$	3.0	$	—	$	3.0	$	—	A
Other long-term receivables (insurance settlement agreement note receivable)	$	34.0	$	—	$	34.0	$	—	C
Net investment hedge contracts	$	11.9	$	—	$	11.9	$	—	A
Liabilities:
Foreign currency contracts	$	1.7	$	—	$	1.7	$	—	A
Commodity contracts	$	0.2	$	—	$	0.2	$	—	A

			Basis of fair value measurements
(millions of dollars)	Balance at December 31, 2017		Quoted prices in active markets for identical items (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Valuation technique
Assets:
Foreign currency contracts	$	1.7	$	—	$	1.7	$	—	A
Other long-term receivables (insurance settlement agreement note receivable)	$	42.9	$	—	$	42.9	$	—	C
Liabilities:
Foreign currency contracts	$	5.0	$	—	$	5.0	$	—	A

The following tables classify the Company's defined benefit plan assets measured at fair value on a recurring basis as of December 31, 2018 and 2017:

			Basis of fair value measurements
(millions of dollars)	Balance at December 31, 2018		Quoted prices in active markets for identical items (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Valuation technique	Assets measured at NAV (a)
U.S. Plans:
Fixed income securities	$	122.1	$	1.2	$	—	$	—	A	120.9
Equity securities	71.0		11.1		—		—		A	59.9
Real estate and other	22.7		17.8		0.2		—		A	4.7
	$	215.8	$	30.1	$	0.2	$	—		$	185.5
Non-U.S. Plans:
Fixed income securities	$	239.4	$	—	$	—	$	—	A	239.4
Equity securities	162.7		92.9		—		—		A	69.8
Real estate and other	36.4		—		—		—		A	36.4
	$	438.5	$	92.9	$	—	$	—		$	345.6

			Basis of fair value measurements
(millions of dollars)	Balance at December 31, 2017		Quoted prices in active markets for identical items (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Valuation technique	Assets measured at NAV (a)
U.S. Plans:
Fixed income securities	$	127.1	$	1.3	$	—	$	—	A	125.8
Equity securities	86.7		13.5		—		—		A	73.2
Real estate and other	26.3		19.9		0.4		—		A	6.0
	$	240.1	$	34.7	$	0.4	$	—		$	205.0
Non-U.S. Plans:
Fixed income securities	$	212.4	$	—	$	—	$	—	A	212.4
Equity securities	233.9		105.4		—		—		A	128.5
Real estate and other	37.1		—		—		—		A	37.1
	$	483.4	$	105.4	$	—	$	—		$	378.0

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(a) Certain assets that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. These amounts represent investments in commingled and managed funds which have underlying assets in fixed income securities, equity securities, and other assets.

Refer toNote 12, "Retirement Benefit Plans," to the Consolidated Financial Statements for more detail surrounding the defined plan’s asset investment policies and strategies, target allocation percentages and expected return on plan asset assumptions.