FAIR VALUE

The following table provides a summary of assets and liabilities as of March 31, 2015, measured at fair value on a recurring basis:



Description	Balance as of March 31, 2015		Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Foreign exchange contracts	$	1,745	$	—	$	1,745	$	—
Commodity contracts	18		—		18		—
Net investment contracts	3		—		3		—
Total assets	$	1,766	$	—	$	1,766	$	—

Liabilities:
Foreign exchange contracts	$	5,639	$	—	$	5,639	$	—
Commodity contracts	200		—		200		—
Contingent consideration	7,606		—		—		7,606
Forward contract	23,801		—		—		23,801
Deferred compensation	22,926		—		22,926		—
Total liabilities	$	60,172	$	—	$	28,765	$	31,407

The following table provides a summary of assets and liabilities as of December 31, 2014, measured at fair value on a recurring basis:



Description	Balance as of December 31, 2014		Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Foreign exchange contracts	$	943	$	—	$	943	$	—
Commodity contracts	47		—		47		—
Net investment contracts	1,091		—		1,091		—
Total assets	$	2,081	$	—	$	2,081	$	—

Liabilities:
Foreign exchange contracts	$	4,573	$	—	$	4,573	$	—
Commodity contracts	69		—		69		—
Net investment contracts	469		—		469		—
Contingent consideration	6,912		—		—		6,912
Forward contract	25,268		—		—		25,268
Deferred compensation	21,839		—		21,839		—
Total liabilities	$	59,130	$	—	$	26,950	$	32,180

The Company’s derivative contracts are valued at fair value using the market approach. The Company measures the fair value of foreign exchange contracts and net investment contracts using Level 2 inputs based on observable spot and forward rates in active markets. The Company measures the fair value of commodity contracts using Level 2 inputs through observable market transactions in active markets provided by financial institutions. During the three months ended March 31, 2015, there were no transfers between Levels 1, 2 or 3.

In connection with an acquisition, the Company recorded a contingent consideration fair valued at $7,606 as of March 31, 2015, which reflects a $694 increase in the liability from December 31, 2014. The contingent consideration is based upon estimated sales for the five-year period ending December 31, 2015 and will be paid in 2016 based on actual sales during the period. The fair value of the contingent consideration is a Level 3 valuation and fair valued using a probability weighted discounted cash flow analysis.

In connection with an acquisition, the Company obtained a controlling financial interest in the acquired entity and at the same time entered into a contract to obtain the remaining financial interest in the entity over a three-year period. The amount to be paid to obtain the remaining financial interest will be based upon actual financial results of the entity. A liability was recorded for the Canadian dollar denominated forward contract at a fair value of $23,801 as of March 31, 2015. The change in liability resulted in $680 being recognized in interest expense in the three months ended March 31, 2015. The fair value of the contract is a Level 3 valuation and is based on the present value of the expected future payments. The expected future payments are based on a multiple of forecast earnings and cash flows over the three-year period ending December 31, 2016, present valued utilizing a risk based discount rates of 3.5% reflective of the Company's cost of debt and 15.9% as a risk adjusted cost of capital and annual earnings before interest and taxes with growth rates ranging from 16.5% to 19.8%.

The deferred compensation liability is the Company’s obligation under its executive deferred compensation plan. The Company measures the fair value of the liability using the market values of the participants’ underlying investment fund elections.

During the third quarter of 2014, the Company identified assets within Asia Pacific Welding for planned divestiture. As of March 31, 2015, the assets identified for divestiture were classified as held for sale and recorded at their fair value as determined using a Level 3 discounted cash flow valuation model. As of March 31, 2015, $29,307 and $8,482 of assets and liabilities held for sale were recorded in Other current assets and Other current liabilities, respectively.

The fair value of “Cash and cash equivalents,” “Accounts receivable,” "Short-term debt" excluding the current portion of long-term debt and “Trade accounts payable” approximated book value due to the short-term nature of these instruments at both March 31, 2015 and December 31, 2014. The fair value of long-term debt at March 31, 2015 and December 31, 2014, including the current portion, was approximately $10,801 and $9,323, respectively, which was determined using available market information and methodologies requiring judgment. The carrying value of this debt at such dates was $10,921 and $9,499, respectively. Since considerable judgment is required in interpreting market information, the fair value of the debt is not necessarily the amount that could be realized in a current market exchange.