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FAIR VALUE MEASUREMENTS | 6 Months Ended
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Apr. 30, 2012
Fair Value Disclosures [Abstract] |
Fair Value Disclosures [Text Block] | 7. FAIR VALUE MEASUREMENTS The following tables set forth by level within the fair value hierarchy, the Company’s assets and liabilities that were measured at fair value on a recurring basis (in thousands):
|  | As of April 30, 2012 |
|  | Quoted Prices |  |  | Significant |  |  | Significant |  |  |  |
|  | in Active Markets |  |  | Other Observable |  |  | Unobservable |  |  |  |
|  | for Identical Assets |  |  | Inputs |  |  | Inputs |  |  |  |
|  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |  |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Deferred compensation plans: |  |  |  |  |  |  |  |  |  |  |  |
Corporate owned life insurance |  | $ | - |  |  | $ | 35,677 |  |  | $ | - |  |  | $ | 35,677 |
Equity securities |  |  | 1,225 |  |  |  | - |  |  |  | - |  |  |  | 1,225 |
Mutual funds |  |  | 1,114 |  |  |  | - |  |  |  | - |  |  |  | 1,114 |
Money market funds and cash |  |  | 963 |  |  |  | - |  |  |  | - |  |  |  | 963 |
Other |  |  | - |  |  |  | 425 |  |  |  | 576 |  |  |  | 1,001 |
Total assets |  | $ | 3,302 |  |  | $ | 36,102 |  |  | $ | 576 |  |  | $ | 39,980 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Contingent Consideration |  | $ | - |  |  | $ | - |  |  | $ | 10,825 |  |  | $ | 10,825 |
|  | As of October 31, 2011 |
|  | Quoted Prices |  |  | Significant |  |  | Significant |  |  |  |
|  | in Active Markets |  |  | Other Observable |  |  | Unobservable |  |  |  |
|  | for Identical Assets |  |  | Inputs |  |  | Inputs |  |  |  |
|  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |  |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Deferred compensation plans: |  |  |  |  |  |  |  |  |  |  |  |
Corporate owned life insurance |  |  | $- |  |  | $ | 26,989 |  |  |  | $- |  |  | $ | 26,989 |
Equity securities |  |  | 1,150 |  |  |  | - |  |  |  | - |  |  |  | 1,150 |
Mutual funds |  |  | 1,004 |  |  |  | - |  |  |  | - |  |  |  | 1,004 |
Money market funds and cash |  |  | 920 |  |  |  | - |  |  |  | - |  |  |  | 920 |
Other |  |  | - |  |  |  | 451 |  |  |  | 573 |  |  |  | 1,024 |
Total assets |  | $ | 3,074 |  |  | $ | 27,440 |  |  | $ | 573 |  |  | $ | 31,087 |
Liabilities: |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |
The Company maintains two non-qualified deferred compensation plans. The assets of the HEICO Corporation Leadership Compensation Plan (the “LCP”) principally represent cash surrender values of life insurance policies, which derive their fair values from investments in mutual funds that are managed by an insurance company and are classified within Level 2 and are valued using a market approach. Certain other assets of the LCP represent investments in money market funds that are classified within Level 1. The majority of the assets of the Company’s other deferred compensation plan are principally invested in equity securities, mutual funds and money market funds that are classified within Level 1. A portion of the assets within the other deferred compensation plan is currently invested in a fund that invests in future and forward contracts; most of which are privately negotiated with counterparties without going through a public exchange, and that use trading methods that are proprietary and confidential. These assets are therefore classified within Level 3 and are valued using a market approach with corresponding gains and losses reported within other income in the Company’s Condensed Consolidated Statements of Operations. The assets of both plans are held within irrevocable trusts and classified within other assets in the Company’s Condensed Consolidated Balance Sheets and have an aggregate value of $40.0 million as of April 30, 2012 and $31.1 million as of October 31, 2011, of which the LCP related assets were $35.7 million and $27.0 million as of April 30, 2012 and October 31, 2011, respectively. The related liabilities of the two deferred compensation plans are included within other long-term liabilities in the Company’s Condensed Consolidated Balance Sheets and have an aggregate value of $39.6 million as of April 30, 2012 and $30.8 million as of October 31, 2011, of which the LCP related liability was $35.3 million and $26.7 million as of April 30, 2012 and October 31, 2011, respectively. As part of the agreement to acquire a subsidiary by the ETG in the second quarter of fiscal 2012, the Company may be obligated to pay contingent consideration of up to $14.6 million in aggregate should the acquired entity meet certain earnings objectives during each of the first five years following the acquisition. The $10.8 million estimated fair value of the contingent consideration as of the acquisition date is classified within Level 3 and was determined using a probability-based scenario analysis approach. Under this method, a set of discrete potential future subsidiary earnings was determined using internal estimates based on various revenue growth rate assumptions for each scenario that ranged from a compound annual growth rate of (8%) to 20%. A probability of likelihood was assigned to each discrete potential future earnings estimate and the resultant contingent consideration was calculated. The resulting probability-weighted contingent consideration amounts were discounted using a weighted average discount rate of 3.5% reflecting the credit risk of a market participant. Significant changes to either the revenue growth rates, related earnings or the discount rate could result in a material change to the amount of contingent consideration accrued and such changes will be recorded in the Company’s condensed consolidated statements of operations. Changes in the fair value of this contingent consideration were not material during the second quarter ended April 30, 2012. As of April 30, 2012, the estimated amount of such contingent consideration to be paid within the next twelve months of $1.6 million is included in accrued expenses and other current liabilities and the remaining $9.2 million is included in other long-term liabilities in the Company’s Condensed Consolidated Balance Sheet. Changes in the Company’s assets and liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3) for the six months ended April 30, 2012 are as follows (in thousands):
|  | Assets |  |  | Liabilities |
Balances as of October 31, 2011 |  | $ | 573 |  |  | $ | - |
Contingent consideration related to acquisition |  |  | - |  |  |  | 10,778 |
Increase in value of contingent consideration |  |  | - |  |  |  | 47 |
Total unrealized gains |  |  | 3 |  |  |  | - |
Balances as of April 30, 2012 |  | $ | 576 |  |  | $ | 10,825 |
The Company did not have any transfers between Level 1 and Level 2 fair value measurements during the six months ended April 30, 2012. The carrying amounts of the Company’s cash and cash equivalents, accounts receivable, trade accounts payable and accrued expenses and other current liabilities approximate fair value as of April 30, 2012 due to the relatively short maturity of the respective instruments. The carrying amount of long-term debt approximates fair value due to its variable interest rates.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 16 -URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13504-108611 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 107 -Paragraph 15C, 15D -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 133 -Paragraph 44A, 44B -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 107 -Paragraph 15A -Subparagraph a-d -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. 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Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13433-108611 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 159 -Paragraph 17-22, 27, 28 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. 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Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=7578670&loc=d3e19207-110258 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 28 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14064-108612 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 + Details
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