Note 8. Fair Value Measurement

Certain assets and liabilities are required to be recorded at fair value on a recurring basis. The Company’s assets and liabilities required to be adjusted to fair value on a recurring basis are pension and other postretirement benefits plan assets, foreign exchange forward contracts and interest rate swaps. See Note 11 for the fair value of the Company’s pension and other postretirement benefits plan assets as of December 31, 2013 and 2012 and Note 14 for the fair value of the Company’s foreign exchange forward contracts and interest rate swaps as of December 31, 2013 and 2012. See Note 13 for the fair value of the Company’s debt as of December 31, 2013, which is recorded at book value.

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company is required to record certain assets and liabilities at fair value on a nonrecurring basis, generally as a result of acquisitions or the remeasurement of assets resulting in impairment charges. See Note 2 for further discussion on the fair value of assets and liabilities associated with acquisitions.

The fair value as of the measurement date, net book value as of the end of the year and related impairment charge for assets measured at fair value on a nonrecurring basis subsequent to initial recognition during the years ended December 31, 2013, 2012 and 2011 were as follows:

2013	Impairment Charge		Fair Value Measurement (Level 3)		Net Book Value
Long-lived assets held and used	$	4.2	$	4.2	$	4.0
Long-lived assets held for sale or disposal		14.8		20.2		18.5
Other intangible assets		3.3		—		—
Total	$	22.3	$	24.4	$	22.5

2012	Impairment Charge		Fair Value Measurement (Level 3)		Net Book Value
Long-lived assets held and used	$	8.0	$	9.8	$	8.5
Long-lived assets held for sale or disposal		15.6		16.4		6.3
Goodwill		848.4		18.1		18.1
Other intangible assets		158.0		3.1		3.1
Total	$	1,030.0	$	47.4	$	36.0

2011	Impairment Charge		Fair Value Measurement (Level 3)		Net Book Value
Long-lived assets held and used	$	14.7	$	68.8	$	61.3
Long-lived assets held for sale or disposal		34.3		12.8		11.7
Goodwill		392.3		—		—
Other intangible assets		90.7		2.2		2.1
Total	$	532.0	$	83.8	$	75.1

The fair values of assets held for sale that were remeasured during the years ended December 31, 2013 and 2012 were reduced by estimated costs to sell of $1.4 million and $0.7 million, respectively. There were no estimated costs to sell related to long-lived assets held for sale that were remeasured during the year ended December 31, 2011.

During the year ended December 31, 2012, goodwill for the magazines, catalogs and retail inserts, books and directories and Europe reporting units, under the Previous Organization Structure, were written down to implied fair values of $18.1 million for magazines, catalogs and retail inserts, and zero for the books and directories and Europe reporting units, respectively. During the year ended December 31, 2011, goodwill for the commercial, forms and labels, Canada and Latin America reporting units, under the Previous Organization Structure, were written down to implied fair values of zero as of October 31, 2011. As of December 31, 2011, $7.4 million of goodwill remained on the forms and labels reporting unit related to the acquisition of Stratus, which was acquired on November 21, 2011. See Note 3 for further discussion regarding these impairment charges and their presentation under the current organization structure.

During the year ended December 31, 2013, certain acquired customer relationship assets related to the financial reporting unit were written down to an implied fair value of zero. After recording the impairment charges, remaining customer relationship intangible assets in the financial reporting unit were $101.2 million as of December 31, 2013. During the year ended December 31, 2012, certain acquired customer relationship assets related to the books and directories, magazines, catalogs and retail inserts and Latin America reporting units, under the Previous Organization Structure, were written down to an implied fair value of $3.1 million for the books and directories reporting unit and zero for both the magazines, catalogs and retail inserts and Latin America reporting units, respectively. After recording the impairment charges, remaining customer relationship intangible assets in the books and directories, magazines, catalogs and retail inserts and Latin America reporting units were $3.1 million, $22.8 million and $8.0 million, respectively, as of December 31, 2012. During the year ended December 31, 2011, certain acquired customer relationship assets, substantially all of which were related to the forms and labels reporting unit, under the Previous Organization Structure, were written down to an implied fair value of zero. The remaining acquired customer relationship asset in the forms and labels reporting unit as of December 31, 2011 was $12.2 million related to the acquisition of Stratus on November 21, 2011. Additionally, other intangible assets for the financial reporting unit, under the Previous Organization Structure, were written down to an implied fair value of $2.2 million during the year ended December 31, 2011. See Note 3 for further discussion regarding these impairment charges and their presentation under the current organization structure.

The Company’s accounting and finance management determines the valuation policies and procedures for Level 3 fair value measurements and is responsible for the development and determination of unobservable inputs.

The fair values of the long-lived assets held and used and long-lived assets held for sale or disposal were determined using Level 3 inputs and were estimated based on discussions with real estate brokers, review of comparable properties, if available, discussions with machinery and equipment brokers, dealer quotes and internal expertise related to the current marketplace conditions. Unobservable inputs obtained from third parties are adjusted as necessary for the condition and attributes of the specific asset.

Determination of goodwill impairment was based on Level 3 inputs, which included discounted cash flow analyses, comparable marketplace fair value data, as well as management’s assumptions in valuing significant tangible and intangible assets. See Note 3 for further discussion on the factors leading to the recognition of the impairment.

Determinations of other intangible assets impairment charges were based on Level 3 measurements under the fair value hierarchy.

The following table presents the fair value, valuation techniques and related unobservable inputs for these Level 3 measurements for the years ended December 31, 2013 and 2012:

	Fair Value		Valuation Technique	Unobservable Input	Range
2013
Customer relationships	$	—	With and without method	Discount rate	16.0%
2012
Customer relationships	$	3.1	Excess earnings	Discount rate Attrition rate	12.5% - 15.0% 2.0% - 15.9%