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FAIR VALUE DISCLOSURES
 6 Months Ended
Sep. 30, 2012
Fair Value Disclosures [Abstract]  
FAIR VALUE DISCLOSURES

Note 4 — FAIR VALUE DISCLOSURES

Assets and liabilities subject to fair value measurement are categorized into one of three different levels depending on the observability of the inputs employed in the measurement, as follows:

  • Level 1 – observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
  • Level 2 – inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
  • Level 3 – unobservable inputs reflecting the Company's own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.

Non-recurring Fair Value Measurements

The majority of our non-financial assets, which include inventories, property and equipment, goodwill and other intangible assets, are not required to be carried at fair value on a recurring basis. However, if certain triggering events occur such that a non-financial asset is required to be evaluated for impairment and deemed to be impaired, the impaired non-financial asset is recorded as its fair value.

The following table summarizes the assets as of September 30, 2012, which are valued at fair value on a non-recurring basis (in thousands):

   Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of September 30, 2012 Total Gain (Loss) for the Three Months Ended September 30, 2012 Total Gain (Loss) for the Six Months Ended September 30, 2012
Assets held for sale $0 $1,961 $0 $1,961 $ (2,000) $ (3,889)
 Total assets  $0 $1,961 $0 $1,961 $ (2,000) $ (3,889)

The following table summarizes the assets as of September 30, 2011, which are valued at fair value on a non-recurring basis (in thousands):

   Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of September 30, 2011 Total Gain (Loss) for the Three and Six Months Ended September 30, 2011
Inventories $0 $48,801 $0 $48,801 $(24,610)
Assets held for sale  0  649  0  649  (400)
 Total assets  $0 $49,450 $0 $49,450 $(25,010)

The fair value of inventories using Level 2 inputs is determined by evaluating the current economic conditions for sale and disposal of spare parts, which includes estimates as to the recoverability of the carrying value of the parts based on historical experience with sales and disposal of similar spare parts, the expected timeframe of sales or disposals, the location of the spare parts to be sold and the condition of the spare parts to be sold or otherwise disposed of. See Note 1 for further discussion of the impairment of inventories. The loss for the six months ended September 30, 2012 related to seven aircraft. The fair value of these aircraft using Level 2 inputs is determined through evaluation of expected sales proceeds for aircraft. This analysis includes estimates based on historical experience with sales, recent transactions involving similar assets, quoted market prices for similar assets and condition and location of aircraft to be sold or otherwise disposed of.

Recurring Fair Value Measurements

The following table summarizes the financial instruments we had as of September 30, 2012, which are valued at fair value on a recurring basis (in thousands):

 

   Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of September 30, 2012 Balance Sheet Classification
Rabbi Trust investments  $4,065 $0 $0 $4,065 Other assets
 Total assets  $4,065 $0 $0 $4,065   

The following table summarizes the financial instruments we had as of March 31, 2012, which are valued at fair value on a recurring basis (in thousands):

 

   Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of March 31, 2012 Balance Sheet Classification
Rabbi Trust investments  $4,171 $0 $0 $4,171 Other assets
 Total assets  $4,171 $0 $0 $4,171   

The rabbi trust investments consist of mutual funds whose fair value is based on quoted prices in active markets for identical assets, and are designated as Level 1 within the valuation hierarchy. The rabbi trust holds investments related to our non-qualified deferred compensation plan for our senior executives.

Fair Value of Financial Instruments

The fair value of our financial instruments has been estimated in accordance with the accounting standard regarding fair value. The fair value of our fixed rate long-term debt is estimated based on quoted market prices. The carrying and fair value of our long-term debt, including the current portion, are as follows (in thousands):

 

  September 30, 2012 March 31, 2012
  Carrying Value Fair Value Carrying Value Fair Value
7 ½% Senior Notes  $350,315 $364,438 $350,346 $364,875
Term Loan   240,000  240,000  245,000  245,000
Revolving Credit Facility   40,000  40,000  59,300  59,300
3% Convertible Senior Notes   104,371  119,669  102,599  120,750
  $734,686 $764,107 $757,245 $789,925

The fair values of our cash and cash equivalents, accounts receivable and accounts payable approximate their carrying values due to the short-term nature of these items.