Danaher 2009 Annual Report Download - page 80

Table of Contents
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Accounting standards define fair value based on an exit price model, establish a framework for measuring fair value where the Company’s assets and
liabilities are required to be carried at fair values and provide for certain disclosures related to the valuation methods used within a valuation hierarchy as
established within the accounting standards. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices
(unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets, quoted
prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, including
interest rates, yield curves and credit risks, or inputs that are derived principally from or corroborated by observable market data through correlation. Level 3
inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification
within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.
A summary of financial assets and liabilities that are measured at fair value on a recurring basis at December 31, 2009 were as follows ($ in thousands):
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Assets:
Available for sale securities $219,120 — — $219,120
Liabilities:
Deferred compensation plans — $61,468 — 61,468
Available for sale securities are measured at fair value using quoted market prices and included in other assets in the accompanying Consolidated Balance
Sheet.
The Company has established nonqualified deferred compensation programs that permit officers, directors and certain management employees to defer a
portion of their compensation, on a pre-tax basis, until their termination of employment. All amounts deferred under this plan are unfunded, unsecured
obligations of the Company and presented as a component of the Company’s compensation and benefits accrual included in accrued expenses in the
accompanying Consolidated Balance Sheet (refer to Note 8). Participants may choose among alternative earning rates for the amounts they defer which are
based on investment options within the Company’s 401K program in the United States. Changes in the value of the deferred compensation liability under these
programs are recognized based on the fair value of the participants’ accounts based on their investment elections.
Refer to Note 10 for information related to the fair value of the Company sponsored defined benefit pension plan assets.
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Source: DANAHER CORP /DE/, 10-K, February 24, 2010 Powered by Morningstar® Document Research℠
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