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Fair Value of Financial Instruments
12 Months Ended
Dec. 31, 2011
Fair Value of Financial Instruments [Abstract]  
Fair Value of Financial Instruments [TextBlock]

Note 14 - Fair Value of Financial Instruments

 

We account for instruments recorded at fair value under the established fair value framework.  The framework also applies under other accounting pronouncements that require or permit fair value measurements. Effective January 1, 2008, we adopted the provisions of the fair value framework related to financial assets and liabilities recognized or disclosed on a recurring basis.   Additionally, beginning in fiscal 2009, we now apply the fair value framework to financial and non-financial assets and liabilities. 

 

The fair value hierarchy for disclosure of fair value measurements is as follows:

Level 1:  Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2:  Quoted prices, other than quoted prices included in Level 1, that are observable for the   assets or liabilities, either directly or indirectly.

Level 3:  Inputs that are unobservable for the assets or liabilities.

 

                As of December 31, 2011, we have no liability in relation to outstanding interest rate swap agreements.  The swap agreements outstanding as of January 1, 2011 expired in the fourth quarter of fiscal 2011.  Our outstanding interest rate swap agreements have been classified within  level 2 of the valuation hierarchy as readily observable market parameters are available to use as the basis of the fair value measurement. 

 

Other Financial Assets and Liabilities

 

 Financial assets with carrying values approximating fair value include cash and cash equivalents and accounts receivable.  Financial liabilities with carrying values approximating fair value include accounts payable and outstanding checks. The carrying value of these financial assets and liabilities approximates fair value due to their short maturities.

 

The fair value of notes receivable approximates the carrying value at December 31, 2011 and January 1, 2011.  Substantially all notes receivable are based on floating interest rates which adjust to changes in market rates.

 

The estimated fair value of our long-term debt, including current maturities, was $276.3 million and $305.6 million at December 31, 2011 and January 1, 2011, respectively, utilizing discounted cash flows.  The fair value is based on interest rates that are currently available to us for issuance of debt with similar terms and remaining maturities.

 

Non-Financial Assets

 

During fiscal 2009 we recognized a goodwill impairment of $50.9 million.  Excluding the $6.0 million impairment of a food distribution center in fiscal 2009, as discussed in Note (4) – Special Charges, we recorded impairment charges of $0.6 million, $0.9 million and $2.5 million in fiscal 2011, 2010 and 2009, respectively.   We utilize a discounted cash flow model and market approach that incorporate unobservable level 3 inputs to test for goodwill and long-lived asset impairments.