Fair Value Measurement

12 Months Ended

Dec. 31, 2011

Fair Value Measurement [Abstract]

Fair Value Measurement

Note 16—Fair Value Measurement

The Company utilizes the market approach to measure fair value for financial assets and liabilities, which primarily relate to derivative contracts. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company uses the income approach to measure fair value of the interest rate cap (see Note 12 of Notes to Consolidated Financial Statements). The Company classifies its financial instruments in a fair value hierarchy that is intended to increase consistency and comparability in fair value measurements and related disclosures. The fair value hierarchy consists of the following three levels:

Level 1	—	Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2	—	Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs which are derived principally from or corroborated by observable market data.
Level 3	—	Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.

Valuation Techniques

The fair value of foreign currency exchange contracts was determined as the net unrealized gains or losses on those contracts, which is the net difference between (i) the U.S. dollars to be received or paid at the contracts’ settlement date and (ii) the U.S. dollar value of the foreign currency to be sold or purchased at the current forward exchange rate. The fair value of these foreign exchange contracts is based on quoted prices that include the effects of U.S. and foreign interest rate yield curves and, therefore, meets the definition of level 2 fair value, as defined above.

The fair value of the interest rate cap was determined using broker quotes, which use discounted cash flows, an income approach, and the then-applicable forward LIBOR rates and, therefore, meets the definition of Level 2 fair value, as defined above.

The fair value of long-lived assets was based on the Company’s best estimates of future cash flows and, therefore, meets the definition of Level 3 fair value, as defined above (see Note 1 of Notes to Consolidated Financial Statements — Nature of Operations and Summary of Significant Accounting Policies — Long-Lived Assets).

The following table represents the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2011 and January 1, 2011:

	December 31, 2011						January 1, 2011
	(Level 1)		(Level 2)		(Level 3)		(Level 1)		(Level 2)		(Level 3)
Assets
Foreign currency exchange contracts	$	—	$	5,587	$	—	$	—	$	834	$	—
Interest rate cap				6,276						—
Liabilities
Foreign currency exchange contracts	$	—	$	532	$	—	$	—	$	3,282	$	—

The following table represents the Company’s assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2011 and January 1, 2011 (see Note 1 of Notes to Consolidated Financial Statements — Long-lived Assets for a description of the testing of retail store assets and intangible assets for impairment):

	December 31, 2011											January 1, 2011
	Fair								Total Gains			Fair								Gains
	Value		(Level 1)		(Level 2)		(Level 3)		(Losses)			Value		(Level 1)		(Level 2)		(Level 3)		(Losses)
Assets
Long-lived assets, retail stores	$	665		—		—	$	665	$	(5,950	)	$	249		—		—	$	249	$	(1,933	)
Long-lived assets, intangible assets		3,579		—		—		3,579		(35,225	)		—		—		—		—		—
									$	(41,175	)									$	(1,933	)