FINANCIAL INSTRUMENTS

The following tables provide a summary of the Company’s significant financial assets and liabilities carried at fair value and measured on a recurring basis as of September 30, 2014 and December 31, 2013 (in thousands):



			Fair Value Measurements at September 30, 2014
	Carrying Value at September 30, 2014		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Restricted investment:
Rabbi Trust	$	11,044	—		$	11,044	—
Fixed income securities	1,994		—		1,994		—
Interest rate cap derivatives	1,161		—		$	1,161	—
Liabilities:
Interest rate swap derivatives	$	7,048	$	—	$	7,048	$	—



			Fair Value Measurements at December 31, 2013
	Carrying Value at December 31, 2013		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Restricted investments:
Guaranteed Investment Contract	$	5,742	—		$	5,742	—
Rabbi Trust	9,534		—		9,534		—
Fixed income securities	1,993		—		1,993		—
Liabilities:
Interest rate swap derivative liabilities	$	390	$	—	$	390	$	—

The Company’s Level 2 financial instruments included in the tables above as of September 30, 2014 and December 31, 2013 consist of an interest rate swap liability held by the Company's Australian subsidiary, the Company's rabbi trust established for GEO employee and employer contributions to the Company. Non-qualified Deferred Compensation Plan and an investment in Canadian dollar denominated fixed income securities. At December 31, 2013, the Company's Level 2 financial instruments included a guaranteed investment contract which was a restricted investment related to CSC of Tacoma LLC ("CSC"). During the nine months ended September 30, 2014, the balance in the guaranteed investment contract was liquidated as it was no longer required because it relates to a portion of the CSC bonds which matured in October 2014. Refer to Note 9 - Debt.

The Australian subsidiary’s interest rate swap liabilities and interest rate cap assets are valued using a discounted cash flow model based on projected Australian borrowing rates. The Company's restricted investment in the rabbi trust is invested in Company owned life insurance policies which are recorded at their cash surrender values. These investments are valued based on the underlying investments held in the policies' separate account. The underlying assets are equity and fixed income pooled funds that are comprised of Level 1 and Level 2 securities. The Canadian dollar denominated securities, not actively traded, are valued using quoted rates for these and similar securities. The restricted investment in the guaranteed investment contract was valued using quoted rates for these and similar securities.