Vistaprint 2013 Annual Report Download - page 66

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63
The following tables summarize our assets and liabilities that are measured at fair value on a recurring
basis and are categorized using the fair value hierarchy:
June 30, 2013
Total
Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Assets
Interest rate swap contracts . . . . . . . . . . . . . . . . . . . . $ 344 $ — $ 344 $ —
Currency forward contracts . . . . . . . . . . . . . . . . . . . . 70 — 70 —
Total assets recorded at fair value . . . . . . . . . . . . . . . $ 414 $ — $ 414 $ —
Liabilities
Interest rate swap contracts . . . . . . . . . . . . . . . . . . . . $ (70) $ — $ (70) $ —
Currency forward contracts . . . . . . . . . . . . . . . . . . . . (203) — (203) —
Total liabilities recorded at fair value . . . . . . . . . . . . . $(273) $ — $ (273) $ —
June 30, 2012
Total
Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Liabilities
Albumprinter contingent earn-out . . . . . . . . . . . . . . . . $ 570 $ — $ — $ 570
Total liabilities recorded at fair value . . . . . . . . . . . . . $ 570 $ — $ — $ 570
During the years ended June 30, 2013 and 2012 there were no significant transfers in or out of Level 1,
Level 2 and Level 3 classifications.
The valuations of the derivatives intended to mitigate our interest rate and currency risk are determined
using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of
each instrument. This analysis utilizes observable market-based inputs, including interest rate curves, interest rate
volatility, or spot and forward exchange rates, and reflects the contractual terms of these instruments, including the
period to maturity. We incorporate credit valuation adjustments to appropriately reflect both our own
nonperformance risk and the respective counterparty's nonperformance risk in the fair value measurements. In
adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the
impact of netting and any applicable credit enhancements.
Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2
of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs,
such as estimates of current credit spreads, to appropriately reflect both our own nonperformance risk and the
respective counterparties' nonperformance risk in the fair value measurement. However, as of June 30, 2013, we
have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our
derivative positions and have determined that the credit valuation adjustments are not significant to the overall
valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are
classified in Level 2 in the fair value hierarchy.
The following table represents the changes in fair value of Level 3 contingent consideration:
Albumprinter contingent
earn-out
Balance at June 30, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 570
Fair value adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (580)
Effect of currency translation adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Balance at June 30, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ —
Form 10-K