Financial Instruments

3 Months Ended

Mar. 30, 2014

Financial Instruments (Thousands of Dollars) [Abstract]

(4) Financial Instruments

The Company's financial instruments include cash and cash equivalents, accounts receivable, short-term borrowings, accounts payable and certain accrued liabilities. At March 30, 2014, March 31, 2013 and December 29, 2013, the carrying cost of these instruments approximated their fair value. The Company's financial instruments at March 30, 2014, March 31, 2013 and December 29, 2013 also include certain assets and liabilities measured at fair value (see Notes 6 and 8) as well as long-term borrowings. The carrying costs and fair values of the Company's long-term borrowings as of March 30, 2014, March 31, 2013 and December 29, 2013 are as follows:

	March 30, 2014				March 31, 2013				December 29, 2013
	Carrying Cost		Fair Value		Carrying Cost		Fair Value		Carrying Cost		Fair Value
6.35% Notes Due 2040	$	500,000		567,700		500,000		584,750		500,000		532,750
6.125% Notes Due 2014		426,356		427,678		434,492		449,395		428,390		435,838
6.30% Notes Due 2017		350,000		399,785		350,000		407,085		350,000		400,050
6.60% Debentures Due 2028		109,895		120,643		109,895		126,588		109,895		118,566
Total long-term debt		1,386,251		1,515,806		1,394,387		1,567,818		1,388,285		1,487,204
Less: Current portion		426,356		427,678		-		-		428,390		435,838
Long-term debt excluding current portion	$	959,895		1,088,128		1,394,387		1,567,818		959,895		1,051,366

The carrying cost of the 6.125 % Notes Due 2014 includes principal amounts of $425,000 as well as fair value adjustments of $1,356, $9,492, and $3,390 at March 30, 2014, March 31, 2013 and December 29, 2013, respectively, related to interest rate swaps. The interest rate swaps were terminated in November 2012 and the fair value adjustments at March 30, 2014, March 31, 2013 and December 29, 2013 represent the unamortized portions of the fair value of the interest rate swaps at the date of termination. At March 30, 2014 the principal amount and fair value adjustment associated with the 6.125 % Notes Due May 15, 2014, totaling $426,356, were included in the current portion of long-term debt. All other carrying costs represent principal amounts and were included in long-term debt excluding the current portion at March 30, 2014 and December 29, 2013. The total principal amount of long-term debt, including the current portion, at March 30, 2014, March 31, 2013 and December 29, 2013 was $1,384,895.

The fair values of the Company's long-term debt are considered Level 3 fair values (see Note 6 for further discussion of the fair value hierarchy) and are measured using the discounted future cash flows method. In addition to the debt terms, the valuation methodology includes an assumption of a discount rate that approximates the current yield on a similar debt security. This assumption is considered an unobservable input in that it reflects the Company's own assumptions about the inputs that market participants would use in pricing the asset or liability. The Company believes that this is the best information available for use in the fair value measurement.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References+ Details