XML 36 R21.htm IDEA: XBRL DOCUMENT v3.20.2
Fair Value
 3 Months Ended
May 31, 2020
Fair Value Disclosures [Abstract]  
Fair Value
Note 14 - Fair Value 

We classify our various assets and liabilities recorded or reported at fair value under a hierarchy prescribed by GAAP that prioritizes inputs to fair value measurement techniques into three broad levels:

Level 1:Observable inputs such as quoted prices for identical assets or liabilities in active markets;

Level 2:Observable inputs other than quoted prices that are directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets; quoted prices for similar or identical assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable; and

Level 3:Unobservable inputs that reflect the reporting entity’s own assumptions.

Assets and liabilities subject to classification are classified upon acquisition.  When circumstances dictate the transfer of an asset or liability to a different level, our policy is to recognize the transfer at the beginning of the reporting period in which the event resulting in the transfer occurred.

The following tables present the fair value of our financial assets and liabilities measured on a recurring basis as of the end of the periods shown:
 Fair Values (1) 
 (in thousands)May 31, 2020February 29, 2020
Assets: 
Money market accounts$62,351  $2,648  
Interest rate swaps—  —  
Foreign currency contracts2,373  2,083  
Total assets$64,724  $4,731  
  
Liabilities: 
Floating rate debt$324,883  $339,305  
Interest rate swaps14,123  10,717  
Foreign currency contracts400  159  
Total liabilities$339,406  $350,181  

(1)Our financial assets and liabilities are classified as Level 2 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.

The carrying amounts of cash and cash equivalents, receivables and accounts payable approximate fair value because of the short maturity of these items.

We use derivatives for hedging purposes and our derivatives are primarily interest rate swaps, foreign currency contracts and cross-currency debt swaps.  See Notes 13, 15 and 16 to these condensed consolidated financial statements for more information on our hedging activities.

We classify our floating rate debt as a Level 2 item because the estimation of the fair market value 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 book value of the floating rate debt approximates its fair value as of the reporting date.
Our other non-financial assets include goodwill, other intangible assets and assets held for sale, which we classify as Level 3 items.  These assets are measured at fair value on a non-recurring basis as part of our impairment testing.  Note 8 to these condensed consolidated financial statements contains additional information related to goodwill and intangible assets, and our impairment testing.