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Fair Value Measurements
6 Months Ended
Sep. 30, 2017
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS
The accounting standard for fair value measurements establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: observable inputs such as quoted prices in active markets (Level 1); inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2); and unobservable inputs in which there is little or no market data, which requires the Company to develop its own assumptions (Level 3).
A financial instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The financial instruments measured at fair value in the accompanying condensed consolidated balance sheets consist of the following:
 
Recurring Fair Value Measurements
as of September 30, 2017
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and cash equivalents:
 
 
 
 
 
 
 
Cash and cash equivalents
$
57,456

 
$

 
$

 
$
57,456

Money market funds (1)
200,493

 
72,094

 

 
272,587

Total cash and cash equivalents
$
257,949

 
$
72,094

 
$

 
$
330,043

Other Assets:
 
 
 
 
 
 
 
Derivative instruments (3)
$

 
$
226

 
$

 
$
226

Total Other Assets
$

 
$
226

 
$

 
$
226

Liabilities:
 
 
 
 
 
 
 
Contingent consideration liability (2)
$

 
$

 
$
3,576

 
3,576

Current derivative instruments (3)
$

 
$
739

 
$

 
$
739

Long-term derivative instruments (3)

 
533

 

 
533

Total Liabilities
$

 
$
1,272

 
$
3,576

 
$
4,848

 
Recurring Fair Value Measurements
as of March 31, 2017
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and cash equivalents:
 
 
 
 
 
 
 
Cash and cash equivalents
$
59,825

 
$

 
$

 
$
59,825

Money market funds (1)

 
157,592

 

 
157,592

Total cash and cash equivalents
$
59,825

 
$
157,592

 
$

 
$
217,417

Liabilities:
 
 
 
 
 
 
 
Contingent consideration liability (2)

 

 
3,576

 
3,576

Total Liabilities
$

 
$

 
$
3,576

 
$
3,576

(1)  Level 2 cash and cash equivalents are invested in money market funds that are intended to maintain a stable net asset value of $1.00 per share by investing in liquid, high quality U.S. dollar-denominated money market instruments. Therefore, the fair value approximates the carrying value. Depending on our short-term liquidity needs, we make regular transfers between money market funds and other cash equivalents.
(2) As discussed in Note 4, the Company recognized a contingent consideration liability in connection with the acquisition of Aquilent. As of September 30, 2017 and March 31, 2017, the estimated fair value of the contingent consideration liability was $3.6 million and was valued using probability-weighted cash flows, which is based on the use of Level 3 fair value measurement inputs. The liability is recorded in other long-term liabilities in the consolidated balance sheet.
(3) The Company’s interest rate swaps are considered over-the-counter derivatives and fair value is estimated based on present value of future cash flows using model-derived valuation that use Level 2 observable inputs such as interest rate yield curves. See Note 9 for further discussion on the Company’s derivative instruments designated as cash flow hedges.
The fair value of the Company's debt, as well as the Senior Notes, approximates their carrying value at September 30, 2017 and March 31, 2017. The fair value of debt is determined using quoted prices or other market information obtained from recent trading activity of each debt tranche in markets that are not active (Level 2 inputs). The fair value is corroborated by prices derived from the interest rate spreads of recently completed leveraged loan transactions of a similar credit profile, industry, and terms to that of the Company. The fair value of the Senior Notes is determined using quoted prices or other market information obtained from recent trading activity in the high-yield bond market (Level 2 inputs).