FAIR VALUES OF ASSETS AND LIABILITIES

9 Months Ended

Sep. 30, 2011

FAIR VALUES OF ASSETS AND LIABILITIES

FAIR VALUES OF ASSETS AND LIABILITIES

NOTE 7:    FAIR VALUES OF ASSETS AND LIABILITIES

Accounting standards establish a three-level fair value hierarchy based upon the assumptions (inputs) used to price assets or liabilities. The hierarchy requires us to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are listed below.

Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than those included in Level 1, such as quoted market prices for similar assets and liabilities in active markets or quoted prices for identical assets in inactive markets.

Level 3 — Unobservable inputs reflecting our own assumptions and best estimate of what inputs market participants would use in pricing an asset or liability.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The carrying value and estimated fair value of our cash equivalents, which consist of short-term money market funds, are classified as Level 1.  Our Level 3 liability is valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the contingent consideration.

As of September 30, 2011 and December 31, 2010, our assets and liabilities that are measured and recorded at fair value on a recurring basis were as follows (in thousands):

	Estimated Fair Value Measurements
Items Measured at Fair Value on a	Carrying		Quoted Prices in Active Markets		Significant Other Observable Inputs		Significant Unobservable Inputs
Recurring Basis	Value		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
September 30, 2011:
Assets:
Money market funds	$	34	$	34	$	—	$	—
Liabilities:
Contingent consideration (1)	$	2,700	$	—	$	—	$	2,700
December 31, 2010:
Assets:
Money market funds	$	54	$	54	$	—	$	—
Liabilities:
Contingent consideration (1)	$	7,166	$	—	$	—	$	7,166

(1)The contingent consideration represents the estimated fair value of the additional potential earn-out opportunity payable in connection with our acquisition of Jupiter eSources that is contingent upon future revenue growth. We estimated the fair value using projected revenue over the earn-out period, and applied a discount rate to the projected earn-out payments that approximated the weighted average cost of capital.

	Fair Value Measurements UsingSignificant Unobservable Inputs(Level 3)(in thousands)
	Contingent Consideration
Beginning balance December 31, 2010	$	7,166
Decrease in fair value	4,466
Ending balance September 30, 2011	$	2,700

The amount of total gains for the three month and nine month periods ended September 30, 2011, attributable to the change in contingent consideration as of September 30, 2011, is $1.7 million and $4.5 million, respectively, and are reflected in “Other operating expense” on the Condensed Consolidated Statements of Income.

As of September 30, 2011 and December 31, 2010, the carrying value of our trade accounts receivable, accounts payable, certain other liabilities, deferred acquisition price payments and capital leases approximated fair value. The amount outstanding under our credit facility at September 30, 2011 and December 31, 2010 was $170.0 million and $67.0 million, respectively, which approximated fair value due to the borrowing rates currently available to us for debt with similar terms.