Fair Value Measurements

12 Months Ended

Dec. 31, 2012

Fair Value Measurements

2. Fair Value Measurements

Fair Value Hierarchy

Accounting guidance on fair value measurements and disclosures establishes a hierarchy that prioritizes the inputs used to measure fair value (generally, assumptions that market participants would use in pricing an asset or liability) based on the quality and reliability of the information provided by the inputs, as follows:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

The Company’s assets and liabilities that are measured at fair value on a recurring basis were derivative instruments and are further described in Note 3. The Company recognizes transfers between input levels as of the actual date of the event. There were no transfers between input levels during the twelve months ended December 31, 2012.

Fair Values of Other Financial Instruments

The following table presents the carrying amounts and estimated fair values of the Company’s other financial instruments at December 31, 2012 and December 31, 2011.

			December 31, 2012				December 31, 2011
(In millions)	Input Level		Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial Assets:
Note receivable		Level 2	$	0.1	$	0.1	$	0.7	$	0.8
Financial Liabilities:
Short-term borrowings		Level 2		253.8		253.8		2.6		2.6
2.875% Senior notes		Level 2		399.6		392.6		0.0		0.0
3.35% Senior notes		Level 2		249.8		264.1		249.7		260.2

The following methods and assumptions were used to estimate the fair value of each class of financial instruments reflected in the Consolidated Balance Sheets:

Note Receivable: The fair value of the note receivable reflects what management believes is the appropriate interest factor at December 31, 2012 and December 31, 2011, respectively, based on similar risks in the market.

Short-Term Borrowings: The carrying amounts of the Company’s unsecured lines of credit and commercial paper issuances approximates fair value because of their short maturities and variable interest rates.

Senior Notes: The Company determines the fair value of its senior notes based upon their quoted market value. These notes lack daily pricing and as such are classified as Level 2.