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Table of Contents DSW INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of January 28, 2012
and January 29, 2011, DSW had no outstanding borrowings under the Credit Facility, had availability under the facility of
$82.7 million and $80.8 million , respectively, and had outstanding letters of credit of $17.3 million and $19.2 million , respectively.
Total interest expense related to Credit Facility for fiscal 2011 , 2010 and 2009
, respectively, included fees, such as commitment and line of credit
fees, of $ 0.6 million , $0.5 million and $0.5 million in each respective period.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. Therefore, fair value is a market-
based measurement based on assumptions of the market participants. As a
basis for these assumptions, DSW classifies its fair value measurements under the following fair value hierarchy:
Financial Assets and Liabilities-
The following table presents financial assets and liabilities measured at fair value on a recurring basis as of the
periods presented:
Cash and equivalents primarily represent cash deposits and investments in money market funds held with financial institutions, as well as credit
card receivables that generally settle within three days. Available-for-sale and held-to maturity investments are valued using a market-
based
approach using level 2 inputs such as prices of similar assets in active markets. Equity investments are evaluated for other-than-
temporary
impairment using level 3 inputs such as the financial condition of the entity.
The following table presents the activity related to level 3 fair value measurements for long-term investments for the periods presented:
F-26
8 .
FAIR VALUE MEASUREMENTS
•
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that are publicly accessible. Active markets have
frequent transactions with enough volume to provide ongoing pricing information.
•
Level 2 inputs are other than level 1 inputs that are directly or indirectly observable. These can include unadjusted quoted prices for similar
assets or liabilities in active markets, unadjusted quoted prices for identical assets or liabilities in inactive markets or other observable inputs.
•
Level 3 inputs are unobservable inputs.
As of January 28, 2012
As of January 29, 2011
Total
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
(in thousands)
Assets:
Cash and equivalents
$
79,003
$
79,003
$
99,126
$
99,126
Short-term investments
296,697
$
296,697
241,557
$
241,557
Long-term investments
53,858
52,707
$
1,151
49,867
48,915
$
952
$
429,558
$
79,003
$
349,404
$
1,151
$
390,550
$
99,126
$
290,472
$
952
Liabilities:
Conversion feature of short-
term debt
$
6,375
$
6,375
Warrant liability
$
29,303
$
29,303
20,624
20,624
$
29,303
$
29,303
$
26,999
$
26,999