Fair Value of Financial Instruments

12 Months Ended

Apr. 29, 2018

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

14. Fair Value of Financial Instruments

ASC Topic 820 establishes a fair value hierarchy that distinguishes between assumptions based on market data (observable inputs) and the company’s assumptions (unobservable inputs). Determining where an asset or liability falls within that hierarchy depends on the lowest level input that is significant to the fair value measurement as a whole. An adjustment to the pricing method used within either level 1 or level 2 inputs could generate a fair value measurement that effectively falls in a lower level in the hierarchy. The hierarchy consists of three broad levels as follows:

Level 1 – Quoted market prices in active markets for identical assets or liabilities;

Level 2 – Inputs other than level 1 inputs that are either directly or indirectly observable, and

Level 3 – Unobservable inputs developed using the company’s estimates and assumptions, which reflect those that market participants would use.

Recurring Basis

The following table presents information about assets and liabilities measured at fair value on a recurring basis:

Fair value measurements at April 29, 2018 using:

	Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
(amounts in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Premier Money Market Fund	$	6,492		N/A		N/A	$	6,492
Low Duration Bond Fund		1,085		N/A		N/A		1,085
Intermediate Term Bond Fund		747		N/A		N/A		747
Strategic Income Fund		619		N/A		N/A		619
Large Blend Fund		402		N/A		N/A		402
Growth Allocation Fund		169		N/A		N/A		169
Moderate Allocation Fund		113		N/A		N/A		113
Other		150		N/A		N/A		150
Liabilities:
EURO Foreign Exchange Contract		N/A	$	55		N/A	$	55

Fair value measurements at April 30, 2017 using:

	Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
(amounts in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Premier Money Market Fund	$	4,811		N/A		N/A	$	4,811
Low Duration Bond Fund		1,081		N/A		N/A		1,081
Intermediate Term Bond Fund		751		N/A		N/A		751
Strategic Income Fund		611		N/A		N/A		611
Large Blend Fund		365		N/A		N/A		365
Growth Allocation Fund		126		N/A		N/A		126
Moderate Allocation Fund		88		N/A		N/A		88
Other		76		N/A		N/A		76
Liabilities:
None		N/A		N/A		N/A		N/A

Our EURO foreign exchange contract was recorded at a fair value provided by our bank and is classified within level 2 of the fair value hierarchy. Most derivative contracts are not listed on an exchange and require the use of valuation models. In accordance with ASC Topic 820, we attempted to maximize the use of observable inputs used in the valuation models used to determine the fair value of this contract. Derivative contracts valued based on valuation models with significant unobservable inputs and that are not actively traded, are classified within level 3 of the fair value hierarchy.

The determination of where an asset or liability falls in the hierarchy requires significant judgment. We evaluate our hierarchy disclosures each quarter based on various factors and it is possible that an asset or liability may be classified differently from quarter to quarter. However, we expect that changes in classifications between different levels will be rare.

Nonrecurring Basis

At April 29, 2018, we had no assets that were required to be measured at fair value on a nonrecurring basis other than the assets acquired from Read (see note 2) that were acquired at fair value:

Fair value measurements at April 29, 2018 using:

	Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
(amounts in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Customer Relationships		N/A		N/A	$	2,247	$	2,247
Goodwill		N/A		N/A		2,107		2,107
Inventory		N/A		N/A		1,128		1,128
Tradename		N/A		N/A		683		683
Equipment		N/A		N/A		379		379
Liabilities:
None		N/A		N/A		N/A		N/A

These customer relationships were recorded at fair market value using a multi-period excess earnings valuation model that used significant unobservable inputs and were classified as level 3. The tradename was recorded at fair market value using the royalty from relief method that used significant unobservable inputs and were classified as level 3.

Additionally, we acquired certain current assets such as accounts receivable and other assets and assumed certain liabilities such as deferred revenue, accounts payable and accrued expenses. Based on the nature of these items and their short maturity, the carrying amount of these items approximated their fair values. See note 2 for the allocation of the acquisition cost to the assets acquired and liabilities assumed based on their fair values.