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Basis of Presentation (Policies)
9 Months Ended
Sep. 30, 2014
Disposal or Impairment of Assets and Lower of Cost or Market Inventory Adjustment

Disposal or Impairment of Assets and Lower of Cost or Market Inventory Adjustment

During the three month period ended September 30, 2014, market conditions changed with regard to demand for certain products offered by the Company. The Company evaluated its operations and reviewed the carrying values of related long-lived assets and inventories and concluded that certain assets had been impacted by the change in market conditions. The Company made a decision that it will not move forward with construction of a resin coating plant in Marshfield, Wisconsin for which the Company had previously developed engineering plans and procured certain equipment that had long-lead delivery times. These assets were classified as available for sale, and with certain other unrelated long-lived assets, the Company recognized a $4,955 loss in adjusting the carrying value to $1,638, which represented the fair value less cost to sell at September 30, 2014. Additionally, due to increasing competition in the China proppant market, the Company evaluated the carrying values of its inventories in China and concluded that current market prices were below carrying costs. Consequently, the Company recognized a $2,798 loss in cost of sales to adjust finished goods and raw materials carrying values to the lower market prices.

U.S. GAAP establishes a fair value hierarchy that has three levels based on the reliability of the inputs used to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions. The carrying value of related long-lived assets were adjusted to fair value less cost to sell based on estimates for similar used equipment, which are Level 3 inputs.