Note 13 - Fair Value

The fair value hierarchy of our financial assets and liabilities carried at fair value and measured on a recurring basis is as follows:

FAIR VALUES OF FINANCIAL ASSETS AND LIABILITIES

(in thousands)

			Quoted Prices in		Significant Other
			Active Markets		Observable
	Fair Values at		for Identical Assets		Market Inputs
Description	November 30, 2014		(Level 1)		(Level 2)

Assets:
Money market accounts	$	370	$	370	$	-
Foreign currency contracts	162		-		162
Total assets	$	532	$	370	$	162

Liabilities:
Long-term debt - fixed rate (1)	$	82,674	$	-	$	82,674
Long-term debt - floating rate	35,707		-		35,707
Total liabilities	$	118,381	$	-	$	118,381


			Quoted Prices in		Significant Other
			Active Markets		Observable
	Fair Values at		for Identical Assets		Market Inputs
Description	February 28, 2014		(Level 1)		(Level 2)

Assets:
Money market accounts	$	1,549	$	1,549	$	-
Foreign currency contracts	-		-		-
Total assets	$	1,549	$	1,549	$	-

Liabilities:
Long-term debt - fixed rate (1)	$	83,951	$	-	$	83,951
Long-term debt - floating rate	112,607		-		112,607
Interest rate swaps and foreign currency contracts	1,596		-		1,596
Total liabilities	$	198,154	$	-	$	198,154

(1)

Debt values are reported at estimated fair value in these tables, but are recorded in the accompanying consolidated condensed balance sheets at the undiscounted value of remaining principal payments due.

The carrying amounts of cash and cash equivalents, receivables and accounts payable approximate fair value because of the short maturity of these items. Money market accounts are included in cash and cash equivalents in the accompanying consolidated condensed balance sheets and are classified as Level 1 items.

We classify our fixed and floating rate debt as Level 2 liabilities because the estimation of the fair market value of these financial liabilities requires the use of discount rates based upon current market rates of interest for debt with comparable remaining terms. Such comparable rates are significant other observable market inputs. The fair market value of the fixed rate debt was computed using a discounted cash flow analysis and discount rates of 1.76 percent at November 30, 2014 and 1.75 percent at February 28, 2014. All other long-term debt has floating interest rates, and its book value approximates its fair value as of the reporting date.

We use derivatives for hedging purposes. As of November 30, 2014, our derivatives consist of foreign currency contracts. We determine the fair value of our derivative instruments based on Level 2 inputs in the fair value hierarchy. See Notes 7, 8, 11, and 14 for more information on our hedging activities.

The Company’s other non-financial assets include goodwill and other intangible assets, which we classify as Level 3 assets. These assets are measured at fair value on a non-recurring basis as part of the Company’s impairment assessments and as circumstances require. As discussed in Note 9, in connection with our annual impairment testing during the fiscal quarter ended May 31, 2014, we recorded a non-cash asset impairment charge of $9.00 million ($8.16 million after tax). The charge related to certain trademarks in our Personal Care segment, which were written down to their estimated fair value, determined on the basis of future discounted cash flows using the relief from royalty valuation method.