XML 97 R23.htm IDEA: XBRL DOCUMENT v2.4.1.9
Fair Value Measurements
12 Months Ended
Mar. 31, 2015
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements

We estimate the fair value of financial instruments using available market information and generally accepted valuation methodologies. We assess the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which pricing inputs used in measuring fair value are observable in the market. Level 1 inputs include unadjusted quoted prices for identical assets or liabilities and are the most observable. Level 2 inputs include unadjusted quoted prices for similar assets and liabilities that are either directly or indirectly observable, or other observable inputs such as interest rates, foreign currency exchange rates, commodity rates, and yield curves. Level 3 inputs are not observable in the market and include our own judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the tables below.
 
There were no significant transfers between Levels 1, 2, and 3 during the twelve months ended March 31, 2015.

The following tables present information about our financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value:
 
Fair value measurement used
 
Recorded
value
as of
 
Active
markets
for
identical
assets or
liabilities
 
Quoted
prices in
similar
instruments
and
observable
inputs
 
Active
markets for
unobservable
inputs
(In thousands)
March 31, 2015
 
(Level 1)
 
(Level 2)
 
(Level 3)
Assets:
 
 
 
 
 
 
 
Corporate-owned life insurance — non-current
2,493

 

 

 
2,493

Liabilities:
 
 
 
 
 
 
 
Contingent consideration — current
$
8

 
$

 
$

 
$
8

Contingent consideration — non-current
104

 

 

 
104


 
Fair value measurement used
 
Recorded
value
as of
 
Active
markets
for
identical
assets or
liabilities
 
Quoted
prices in
similar
instruments
and
observable
inputs
 
Active
markets for
unobservable
inputs
(In thousands)
March 31, 2014
 
(Level 1)
 
(Level 2)
 
(Level 3)
Assets:
 
 
 
 
 
 
 
Investments
$
28,999

 
$

 
$
28,999

 
$

Corporate-owned life insurance — current
1,989

 

 

 
1,989

Corporate-owned life insurance — non-current
2,371

 

 

 
2,371

Liabilities:
 
 
 
 
 
 
 
Contingent consideration - current
$
127

 
$

 
$

 
$
127

Contingent consideration - non-current
1,612

 

 

 
1,612


The fair value of investments, comprised of commercial paper and certificates of deposit, was determined using a market approach, based on prices and other relevant information generated by market transactions involving similar assets, and therefore, is classified within Level 2 of the fair value hierarchy.
The recorded value of the corporate-owned life insurance policies is adjusted to the cash surrender value of the policies obtained from the third party life insurance providers, which are not observable in the market, and therefore, are classified within Level 3 of the fair value hierarchy. Changes in the cash surrender value of these policies are recorded within “Other expenses (income), net” in the Consolidated Statements of Operations.

The fair value of the contingent consideration was determined by calculating the probability-weighted earn-out payments based on the assessment of the likelihood that certain milestones would be achieved.


The following table presents a summary of changes in the fair value of the corporate-owned life insurance Level 3 asset for the fiscal years ended March 31, 2015 and 2014:
 
Level 3 assets and
liabilities
(In thousands)
2015
 
2014
Corporate-owned life insurance:
 
 
 
Balance on April 1
$
4,360

 
$
3,673

Realized gains
57

 

Unrealized gain relating to instruments held at reporting date
65

 
600

Purchases, sales, issuances and settlements, net
(1,989
)
 
87

Balance on March 31
$
2,493

 
$
4,360



The inputs used to value our contingent consideration and employee benefit plan obligations are not observable in the market and therefore, these amounts are classified within Level 3 in the fair value hierarchy.

The following table presents a summary of changes in the fair value of the contingent consideration Level 3 liability for fiscal years ended March 31, 2015 and 2014:


Level 3 assets and
liabilities

(In thousands)
2015
 
2014
Contingent consideration:
 
 
 
Balance on April 1
$
1,739

 
$

Activity, payments and other charges (net)
(9
)
 
1,739

Fair value adjustment
(1,618
)
 

Balance on March 31
$
112

 
$
1,739


The fair value of the contingent consideration related to the TMC acquisition was determined by calculating the probability-weighted earn-out payments based on the assessment of the likelihood that certain revenue milestones would be achieved. As of March 31, 2015, due to a decrease in expected revenues associated with the contingent consideration, we recorded a gain of $1.6 million within "Asset write-offs and other fair value adjustments" in the Consolidated Statements of Operations.