O'Reilly Auto Parts 2008 Annual Report Download - page 57

Download and view the complete annual report

Please find page 57 of the 2008 O'Reilly Auto Parts annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 68

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68

O’REILLY AUTOMOTIVE 2008 ANNUAL REPORT PG.55
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Assets and liabilities measured at fair value are based on one or more of three valuation techniques noted in SFAS 157.
A) MARKET APPROACH – prices and other relevant information generated by market transactions involving identical or comparable assets
or liabilities
B) COST APPROACH – amount that would be required to replace the service capacity of an asset (replacement cost)
C) INCOME APPROACH – techniques to convert future amounts to a single present amount based on market expectations (including present
value techniques, option-pricing and excess earnings models)
Assets and liabilities measured at fair value on a recurring basis are as follows:
Quoted Prices Signicant
in Active Other Signicant
Markets for Observable Unobservable
Identical Assets Inputs Inputs Valuation
(In thousands) December 31, 2008 (Level 1) (Level 2) (Level 3) Technique
Net derivative contracts $ (18,874) $ -- $ (18,874) $ -- (c)
e estimated fair values of the Company’s nancial instruments, which are determined by reference to quoted market prices, where available,
or are based on comparisons to similar instruments of comparable maturities, are as follows:
December 31, 2008 December 31, 2007
Carrying Estimated Carrying Estimated
(In thousands) Amount Fair Value Amount Fair Value
Obligations under 6 ¾% senior exchangeable notes $ 103,568 $ 99,750 $ -- $ --
NOTE 10 – ACCUMULATED OTHER COMPREHENSIVE LOSS
Unrealized holding gains on available-for-sale securities, consisting of the Company’s investment in CSK common stock prior to the Company’s
completion of the acquisition of CSK, as well as unrealized losses from interest rate swaps that qualify as cash ow hedges are included in
accumulated other comprehensive income (loss). e adjustment to accumulated other comprehensive loss for the year ended December 31,
2008, totaled $8.0 million with a corresponding tax liability of $3.3 million resulting in a net of tax eect of $4.7 million. e adjustment to
accumulated other comprehensive loss for the year ended December 31, 2007, totaled $10.9 million with a corresponding tax liability of $4.1
million resulting in a net of tax eect of $6.8 million.
Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2006, December 31, 2007, and December 31,
2008, consisted of the following:
Unrealized Gains Unrealized Losses on Accumulated Other
(In thousands) on Securities Cash Flow Hedges Comprehensive Loss
Balance at December 31, 2006 $ -- $ -- $ --
Period change (6,800) -- (6,800)
Balance at December 31, 2007 (6,800) -- (6,800)
Period change 6,800 (11,513) (4,713)
Balance at December 31, 2008 $ -- $ (11,513) $ (11,513)
Comprehensive income for the years ended December 31, 2008, December 31, 2007, and December 31, 2006, was $181.5 million $187.2 million,
and $178.1 million, respectively.