Urban Outfitters 2012 Annual Report Download - page 68

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Table of Contents
URBAN OUTFITTERS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(in thousands, except share and per share data)
As of January 31, 2012, the par value of our ARS was $22,975 and the estimated fair value was $20,197. Our ARS portfolio consists of "A" or better
rated ARS that represent interests in municipal and student loan related collateralized debt obligations, all of which are guaranteed by either government
agencies and/or insured by private insurance agencies at 97% or greater of par value. To date, we have collected all interest payable on outstanding ARS when
due and have not been informed by the issuers that accrued interest payments are currently at risk. The Company does not have the intent to sell the
underlying securities prior to their recovery and the Company believes it is not likely that it will be required to sell the underlying securities prior to their
anticipated recovery of full amortized cost.
4. Fair Value
The Company utilizes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques
(market approach, income approach and cost approach that relate to its financial assets and financial liabilities). The levels of the hierarchy are described as
follows:
• Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities.
• Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for
similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
• Level 3: Unobservable inputs that reflect the Company's own assumptions.
Management's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of
financial assets and liabilities and their placement within the fair value hierarchy. The Company's financial assets that are accounted for at fair value on a
recurring basis are presented in the table below:
Marketable Securities Fair Value as of
January 31, 2012
Level 1 Level 2 Level 3 Total
Assets:
Corporate bonds $ 95,935 $ — $ — $ 95,935
Municipal and pre-refunded municipal bonds — 60,234 — 60,234
Auction rate securities — — 20,197 20,197
Treasury bills 14,988 — — 14,988
Certificates of deposit — 12,194 — 12,194
Federal government agencies 9,627 — — 9,627
Commercial paper — 3,592 — 3,592
$ 120,550 $ 76,020 $ 20,197 $ 216,767
F-17