NOTE 11 – FAIR VALUE

The following tables present the fair value of our financial assets and liabilities carried at fair value and measured on a recurring basis as of the last day of February 2016 and 2015:

FAIR VALUES OF FINANCIAL ASSETS AND LIABILITIES

(in thousands)


	Fair Values at
	February 29, 2016
	(Level 2) (1)
Assets:
Money market accounts	$	211,964
Foreign currency contracts		1,372
Total assets	$	213,336

Liabilities:
Fixed rate debt (2)	$	40,785
Floating rate debt		583,907
Foreign currency contracts		502
Total liabilities	$	625,194


	Fair Values at
	February 28, 2015
	(Level 2) (1)
Assets:
Money market accounts	$	1,692
Foreign currency contracts		129
Total assets	$	1,821

Liabilities:
Fixed rate debt (2)	$	62,006
Floating rate debt		373,207
Foreign currency contracts		240
Total liabilities	$	435,453

(1)

Our financial assets and liabilities are classified as Level 2 assets because their valuation is dependent on observable inputs and other quoted prices for similar assets or liabilities, or model-derived valuations whose significant value drivers are observable.

(2)

Debt values are reported at estimated fair value in these tables, but are recorded in the accompanying consolidated balance sheets at the undiscounted value of remaining principal payments due.

The carrying amounts of cash and cash equivalents, receivables and accounts payable approximate fair value because of the short maturity of these items. Money market accounts at February 29, 2016 primarily held short-term U.S. treasury obligations and are included in cash and cash equivalents in the accompanying consolidated balance sheets. Money market accounts temporarily held $210 million drawn shortly before the end of fiscal year 2016 in order to facilitate the closing of the Hydro Flask acquisition in March 2016.

We use derivatives for hedging purposes and our derivatives are primarily foreign currency contracts and a cross-currency debt swap. See Notes (1), (12) and (17) to these consolidated financial statements for more information on our hedging activities.

We classify our fixed and floating rate debt as Level 2 items because the estimation of the fair market value of these financial assets requires the use of a discount rate based upon current market rates of interest for obligations with comparable remaining terms. Such comparable rates are considered significant other observable market inputs. The fair market value of the fixed rate debt was computed using a discounted cash flow analysis and discount rates at February 29, 2016 and February 28, 2015 of 2.39 and 2.05 percent, respectively. All other long-term debt has floating interest rates, and its book value approximates its fair value as of the reporting date.

The Company’s other non-financial assets include goodwill and other intangible assets, which we classify as Level 3 items. These assets are measured at fair value on a non-recurring basis as part of the Company’s impairment assessments and as circumstances require. As discussed in Note (5) to these consolidated financial statements, in fiscal years 2016 and 2015, we recorded non-cash asset impairment charges totaling $6.00 million ($5.31 million after tax) and $9.00 million ($8.16 million after tax), respectively. The charges related to certain trademarks in our Beauty segment, which were written down to their estimated fair value, determined on the basis of future discounted cash flows using the relief from royalty valuation method. The table below presents other non-financial assets measured on a non-recurring basis using significant unobservable inputs (Level 3) for the fiscal years 2016 and 2015:

OTHER NON-FINANCIAL ASSETS

FAIR VALUE MEASUREMENTS USING SIGNIFICANT UNOBSERVABLE INPUTS (Level 3)

(in thousands)


	Fiscal Years Ended
	the Last Day of February,
	2016		2015
Beginning balances	$	948,157	$	775,550
Total income (expense):
Included in net income - realized		(31,547)		(34,152)
Acquired during the period		44,052		205,764
Acquisition adjustments and retirements during the period		(1,906)		995
Ending balances	$	958,756	$	948,157