Annual report pursuant to Section 13 and 15(d)

Fair Value Measurements

v3.7.0.1
Fair Value Measurements
12 Months Ended
Jan. 28, 2017
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements
GAAP utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to observable quoted prices (unadjusted) in active markets for identical assets and liabilities (Level 1 measurement), then priority to quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market (Level 2 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).
As of January 28, 2017 and January 30, 2016 the Company had $450,000 in Level 2 investments in the form of bank certificates of deposit. The Company's investments in certificates of deposits were measured using inputs based upon quoted prices for similar instruments in active markets and, therefore, were classified as Level 2 investments. As of January 28, 2017 and January 30, 2016 the Company also had long-term variable rate Credit Facilities, classified as Level 2, with carrying values of $85,388,000 and $72,414,000, respectively. As of January 28, 2017 and January 30, 2016, respectively, $3,242,000 and $2,143,000 was classified as current. The fair value of the variable rate Credit Facilities approximates and is based on its carrying value. The Company has no Level 3 investments that use significant unobservable inputs.
Non Financial Assets Measured at Fair Value - Nonrecurring Basis
As of January 28, 2017 and January 30, 2016 the Company had an intangible FCC broadcasting license asset with a carrying value of $12,000,000. The Company estimates the fair value of its FCC television broadcast license asset primarily by using income-based discounted cash flow models. In determining fair value, the Company considered, among other factors, the advice of an independent outside fair value consultant. The discounted cash flow models utilize a range of assumptions including revenues, operating profit margin, projected capital expenditures and an unobservable input discount rate of 10.0%. The Company concluded that the inputs used in its intangible FCC broadcasting license asset valuation are Level 3 inputs.
The following table provides a reconciliation of the beginning and ending balances of non-financial assets measured at fair value on a nonrecurring basis that use significant unobservable inputs (Level 3):
 
 
January 28,
2017
 
January 30,
2016
Intangible FCC Broadcasting License Asset:
 
 
 
 
Beginning balance
 
$
12,000,000

 
$
12,000,000

Losses included in earnings (asset impairment)
 

 

Ending balance
 
$
12,000,000

 
$
12,000,000