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Fair Value Measurements | 9 Months Ended
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Mar. 31, 2020
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Fair Value Measurements The fair values of the Company’s financial assets and financial liabilities listed below reflect the amounts that would be received to sell the assets or paid to transfer the liabilities in an orderly transaction between market participants at the measurement date (exit price). The Company’s non-derivative financial instruments primarily include cash and cash equivalents, trade receivables, trade payables, short-term debt and long-term debt. At March 31, 2020 and June 30, 2019, the carrying value of these financial instruments, excluding long-term debt, approximates fair value because of the short-term nature of these instruments. The fair value of long-term debt with variable interest rates approximates its carrying value. The fair value of the Company’s long-term debt with fixed interest rates is based on market prices, if available, or expected future cash flows discounted at the current interest rate for financial liabilities with similar risk profiles. The carrying values and estimated fair values of long-term debt with fixed interest rates (excluding capital leases) were as follows:
|  | March 31, 2020 |  |  |  | June 30, 2019 |  |
|  | Carrying Value |  | Fair Value |  | Carrying Value |  | Fair Value
($ in millions) |  |  |  | (Level 2) |  |  |  | (Level 2)
Total long-term debt with fixed interest rates (excluding commercial paper and capital leases) |  |  | $ | 2,539.4 |  |  | $ | 2,640.6 |  |  | $ | 2,955.6 |  |  | $ | 3,041.3 |
Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis Additionally, the Company measures and records certain assets and liabilities, including derivative instruments and contingent purchase consideration liabilities, at fair value. The following table summarizes the fair value of these instruments, which are measured at fair value on a recurring basis, by level, within the fair value hierarchy:
|  | March 31, 2020 |  |  |  |  |  |
($ in millions) |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Assets |  |  |  |  |  |  |  |
Commodity contracts |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Forward exchange contracts |  | — |  |  | 12.2 |  |  | — |  |  | 12.2 |
Interest rate swaps |  | — |  |  | 35.0 |  |  | — |  |  | 35.0 |
Cross currency interest rate swaps |  | — |  |  | 1.5 |  |  | — |  |  | 1.5 |
Total assets measured at fair value |  | $ | — |  |  | $ | 48.7 |  |  | $ | — |  |  | $ | 48.7 |
Liabilities |  |  |  |  |  |  |  |
Contingent purchase consideration liabilities |  | $ | — |  |  | $ | — |  |  | $ | 14.4 |  |  | $ | 14.4 |
Commodity contracts |  | — |  |  | 9.4 |  |  | — |  |  | 9.4 |
Forward exchange contracts |  | — |  |  | 22.6 |  |  | — |  |  | 22.6 |
Treasury locks |  | — |  |  | 19.0 |  |  | — |  |  | 19.0 |
Total liabilities measured at fair value |  | $ | — |  |  | $ | 51.0 |  |  | $ | 14.4 |  |  | $ | 65.4 |
|  | June 30, 2019 |  |  |  |  |  |
($ in millions) |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Assets |  |  |  |  |  |  |  |
Commodity contracts |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Forward exchange contracts |  | — |  |  | 5.5 |  |  | — |  |  | 5.5 |
Interest rate swaps |  | — |  |  | 32.8 |  |  | — |  |  | 32.8 |
Total assets measured at fair value |  | $ | — |  |  | $ | 38.3 |  |  | $ | — |  |  | $ | 38.3 |
Liabilities |  |  |  |  |  |  |  |
Contingent purchase consideration liabilities |  | $ | — |  |  | $ | — |  |  | $ | 13.6 |  |  | $ | 13.6 |
Commodity contracts |  | — |  |  | 4.6 |  |  | — |  |  | 4.6 |
Forward exchange contracts |  | — |  |  | 9.3 |  |  | — |  |  | 9.3 |
Interest rate swaps |  | — |  |  | — |  |  | — |  |  | — |
Total liabilities measured at fair value |  | $ | — |  |  | $ | 13.9 |  |  | $ | 13.6 |  |  | $ | 27.5 |
The fair value of the commodity contracts was determined using a discounted cash flow analysis based on the terms of the contracts and observed market forward prices discounted at a currency-specific rate. Forward exchange contract fair values were determined based on quoted prices for similar assets and liabilities in active markets using inputs such as currency rates and forward points. The fair value of the interest rate swaps was determined using a discounted cash flow method based on market-based swap yield curves, taking into account current interest rates. The fair value of Treasury locks was determined based on the present value of the discounted future cash flows based on the difference between the agreed upon Treasury rate and the current 10-year U.S. Treasury rate. The fair value of the contingent purchase consideration liabilities was determined for each arrangement individually. The fair value was determined using the income approach with significant inputs that are not observable in the market. Key assumptions include the discount rates consistent with the level of risk of achievement and probability adjusted financial projections. The expected outcomes are recorded at net present value, which requires adjustment over the life for changes in risks and probabilities. The fair value of contingent purchase consideration liabilities is included in other current liabilities and other non-current liabilities in the unaudited condensed consolidated balance sheet. Assets and Liabilities Measured and Recorded at Fair Value on a Nonrecurring Basis In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis as required by U.S. GAAP. The Company measures certain assets, including the Company’s equity method investments, technology intangible assets, and other intangible assets at fair value on a nonrecurring basis when they are deemed to be other than temporarily impaired. The fair values of these assets are determined, when applicable, based on valuation techniques using the best information available, and may include quoted market prices, market comparables and discounted cash flow projections. The Company tests for impairment of its equity method investments when impairment indicators are present. Impairment tests were performed by comparing the carrying value of the Company’s investment in AMVIG Holdings Limited ("AMVIG") at the end of each period, including interim periods, to the fair value of the investment, which was determined based on AMVIG's quoted share price which is classified in Level 1 of the fair value hierarchy. The fair value of the Company’s equity method investment in AMVIG at March 31, 2020 was below the Company’s carrying value of the investment by approximately 20%. At June 30, 2019, the fair value of the Company’s investment in AMVIG exceeded the Company’s carrying value. The Company recorded impairment charges during the nine months ended March 31, 2019 of $13.9 million, as the fair value of the investment was below its carrying value. Based on the Company’s evaluation of AMVIG’s current financial condition and the Company’s intent and ability to hold its investment in AMVIG to recover the carrying value, the Company concluded that the decline in fair value is temporary at March 31, 2020, and therefore no impairment was recorded. Continued market uncertainty due to the COVID-19 outbreak could result in the conclusion that a non-cash impairment of the Company’s investment in AMVIG is warranted in future periods. Similar to the manner in which it tests other intangible assets, the Company tests technology intangibles for impairment when facts and circumstances indicate the carrying value may not be recoverable from their undiscounted cash flows. During the nine months ended March 31, 2020 and 2019, there were no triggering events and therefore no technology intangible impairment charges recorded.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
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