FAIR VALUE

9 Months Ended

Sep. 30, 2012

FAIR VALUE

FAIR VALUE

NOTE 13 – FAIR VALUE

Authoritative guidelines require the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets or liabilities.  Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment.  The three levels are defined as follows:

·Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities.

·Level 2: Observable inputs other than those included in Level 1.  For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.

·Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability.

As of September 30, 2012, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Forward exchange contracts (a)	$	1,161	$	—	$	1,161	$	—
Total assets at fair value	$	1,161	$	—	$	1,161	$	—
Liabilities
Forward exchange contracts (a)	$	2,853	$	—	$	2,853	$	—
Total liabilities at fair value	$	2,853	$	—	$	2,853	$	—

As of December 31, 2011, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Forward exchange contracts (a)	$	520	$	—	$	520	$	—
Total assets at fair value	$	520	$	—	$	520	$	—
Liabilities
Forward exchange contracts (a)	$	10,690	$	—	$	10,690	$	—
Total liabilities at fair value	$	10,690	$	—	$	10,690	$	—

(a)   Market approach valuation technique based on observable market transactions of spot and forward rates

The carrying amounts of the Company’s other current financial instruments such as cash and equivalents, notes payable and current maturities of long-term obligations approximate fair value due to the short-term maturity of the instrument.  The Company considers its long-term obligations a Level 2 liability and utilizes the market approach valuation technique based on interest rates that are currently available to the Company for issuance of debt with similar terms and maturities.  The estimated fair value of the Company’s long-term obligations was $409 million as of September 30, 2012 and $283 million as of December 31, 2011.