XML 36 R20.htm IDEA: XBRL DOCUMENT
v3.21.1

Fair Value Measurements | 12 Months Ended
--- | ---
Mar. 27, 2021
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Fair Value Measurements Financial assets and liabilities are measured at fair value using the three-level valuation hierarchy for disclosure of fair value measurements. The determination of the applicable level within the hierarchy of a particular asset or liability depends on the inputs used in the valuation as of the measurement date, notably the extent to which the inputs are market-based (observable) or internally derived (unobservable). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. Unobservable inputs are inputs based on a company’s own assumptions about market participant assumptions based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that a company has the ability to access at the measurement date. Level 2 – Valuations based on quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability and inputs derived principally from or corroborated by observable market data. Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. At March 27, 2021 and March 28, 2020, the fair values of the Company’s forward foreign currency exchange contracts, interest rate swaps and net investment hedges were determined using broker quotations, which were calculations derived from observable market information: the applicable currency rates at the balance sheet date and those forward rates particular to the contract at inception. The Company makes no adjustments to these broker obtained quotes or prices, but assesses the credit risk of the counterparty and would adjust the provided valuations for counterparty credit risk when appropriate. The fair values of the forward contracts are included in prepaid expenses and other current assets, and in accrued expenses and other current liabilities in the consolidated balance sheets, depending on whether they represent assets or liabilities to the Company. The fair values of net investment hedges and interest rate swaps are included in other assets, and in other long-term liabilities in the consolidated balance sheets, depending on whether they represent assets or liabilities of the Company. See Note 15 for detail. All contracts are measured and recorded at fair value on a recurring basis and are categorized in Level 2 of the fair value hierarchy, as shown in the following table (in millions):
| Fair value at March 27, 2021, using: |  | Fair value at March 28, 2020, using:
| Quoted prices in active markets for identical assets (Level 1) |  | Significant other observable inputs (Level 2) |  | Significant unobservable inputs (Level 3) |  | Quoted prices in active markets for identical assets (Level 1) |  | Significant other observable inputs (Level 2) |  | Significant unobservable inputs (Level 3)
Derivative assets: |  |  |  |  |  |  |  |  |  |  |
Forward foreign currency exchange contracts | $ | — |  |  | $ | 2 |  |  | $ | — |  |  | $ | — |  |  | $ | 1 |  |  | $ | — |
Net investment hedges | — |  |  | 3 |  |  | — |  |  | — |  |  | 3 |  |  | — |
Total derivative assets | $ | — |  |  | $ | 5 |  |  | $ | — |  |  | $ | — |  |  | $ | 4 |  |  | $ | — |
Derivative liabilities: |  |  |  |  |  |  |  |  |  |  |
Forward foreign currency exchange contracts | $ | — |  |  | $ | 1 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Net investment hedges | — |  |  | 263 |  |  | — |  |  | — |  |  | — |  |  | — |
Designated interest rate swaps | — |  |  | 1 |  |  | — |  |  | — |  |  | — |  |  | — |
Total derivative liabilities | $ | — |  |  | $ | 265 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
The Company’s long-term debt obligations are recorded in its consolidated balance sheets at carrying values, which may differ from the related fair values. The fair value of the Company’s long-term debt is estimated using external pricing data, including any available quoted market prices and based on other debt instruments with similar characteristics. Borrowings under revolving credit agreements, if outstanding, are recorded at carrying value, which approximates fair value due to the frequent nature of such borrowings and repayments. See Note 12 for detailed information related to carrying values of the Company’s outstanding debt. The following table summarizes the carrying values and estimated fair values of the Company’s short- and long-term debt, based on Level 2 measurements (in millions):
|  | March 27, 2021 |  | March 28, 2020
|  | Carrying Value |  | Estimated Fair Value |  | Carrying Value |  | Estimated Fair Value
Senior Notes due 2024 |  | $ | 447 |  |  | $ | 470 |  |  | $ | 446 |  |  | $ | 443 |
Term Loan |  | $ | 865 |  |  | $ | 866 |  |  | $ | 1,010 |  |  | $ | 957 |
Revolving Credit Facilities |  | $ | — |  |  | $ | — |  |  | $ | 720 |  |  | $ | 720 |
The Company’s cash and cash equivalents, accounts receivable and accounts payable, are recorded at carrying value, which approximates fair value. Non-Financial Assets and Liabilities The Company’s non-financial assets include goodwill, intangible assets, operating lease right-of-use assets and property and equipment. Such assets are reported at their carrying values and are not subject to recurring fair value measurements. The Company’s goodwill and its indefinite-lived intangible assets (Versace and Jimmy Choo brands) are assessed for impairment at least annually, while its other long-lived assets, including operating lease right-of-use assets, property and equipment and definite-lived intangible assets, are assessed for impairment whenever events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable. The fair values of these assets were determined based on Level 3 measurements using the Company’s best estimates of the amount and timing of future discounted cash flows, based on historical experience, market conditions, current trends and performance expectations. The following table details the carrying values and fair values of the Company’s assets that have been impaired (in millions):
| Carrying Value Prior to Impairment |  | Fair Value |  | Impairment Charge (1)
Fiscal 2021: |  |  |  |  |
Operating Lease Right-of-Use Assets | $ | 326 |  |  | $ | 191 |  |  | $ | 135 |
Goodwill | 319 |  |  | 225 |  |  | 94 |
Brands | 407 |  |  | 338 |  |  | 69 |
Property and Equipment | 30 |  |  | 7 |  |  | 23 |
Total | $ | 1,082 |  |  | $ | 761 |  |  | $ | 321 |
Fiscal 2020: |  |  |  |  |
Operating Lease Right-of-Use Assets | $ | 717 |  |  | $ | 437 |  |  | $ | 280 |
Brands | 547 |  |  | 367 |  |  | 180 |
Goodwill | 474 |  |  | 303 |  |  | 171 |
Property and Equipment | 105 |  |  | 28 |  |  | 77 |
Total | $ | 1,843 |  |  | $ | 1,135 |  |  | $ | 708 |
Fiscal 2019: |  |  |  |  |
Property and Equipment | 26 |  |  | 7 |  |  | 19 |
Lease Rights | 3 |  |  | 1 |  |  | 2 |
Total | $ | 29 |  |  | $ | 8 |  |  | $ | 21 |
(1)Includes $5 million of impairment charges that were recorded within restructuring and other charges related to the Capri Retail Store Optimization Program during the Fiscal 2021. In addition to the impairment charges above, the Company recorded an adjustment to reduce its March 31, 2019 opening balance of retained earnings by $152 million, net of tax, reflecting impairments of operating lease right-of-use assets for certain underperforming real estate locations for which the carrying value of the opening operating lease right-of-use asset exceeded its related fair value. Property and equipment related to these underperforming locations were fully impaired due to the adoption of ASU 2016-02. See Note 2 and Note 4 for additional information. There were no impairment charges related to goodwill or indefinite-lived intangible assets in Fiscal 2019.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration