Rue 21 2011 Annual Report Download - page 52

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rue21, inc. and subsidiary
Notes to Consolidated Financial Statements — (continued)
Equity awards to purchase 699, 340 and 400 shares of common stock for the fiscal years 2011, 2010, and 2009,
respectively, were outstanding, but were not included in the computation of weighted average diluted common share
amounts as the effect of doing so would have been anti-dilutive.
Note 2 — Fair Value Measurements
The FASB’s authoritative guidelines require the categorization of assets and liabilities into three levels based
upon the assumptions (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of
fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as
follows:
•Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities. The Company’s cash,
cash equivalents and short term investments of $71,960 and $50,111 as of January 28, 2012 and January 29,
2011, respectively, are reported at fair value utilizing Level 1 inputs. The carrying value of these instruments
approximate fair value because of their short-term maturity.
•Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar
assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.
•Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the
asset or liability. The Company determined that the fair value measurements related to the impaired long
lived assets disclosed in Note 1 are derived from significant unobservable inputs. These non-financial assets
are measured on a non-recurring basis when events and circumstances warrant.
In accordance with ASC 820, the following tables represent the fair value hierarchy for the Company’s
financial assets (cash equivalents) measured at fair value on a recurring basis as of January 28, 2012 and January 29,
2011:
Fair Value Measurements at January 28, 2012
Cash and cash Equivalents
Carrying
Amount
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
Significant Other
Observable
Inputs (Level 2)
Significant
Unobservable
Inputs
(level 3)
(in thousands)
Cash ............................... $41,960 $41,960 $— $—
Short Term Investments ............... $30,000 $30,000
Total .............................. $71,960 $71,960 $— $—
Fair Value Measurements at January 29, 2011
Cash and cash Equivalents
Carrying
Amount
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
Significant Other
Observable
Inputs (Level 2)
Significant
Unobservable
Inputs
(level 3)
(in thousands)
Cash ............................... $50,111 $50,111 $— $—
Total ..............................
$50,111 $50,111
$
—$—
49