Toro 2015 Annual Report Download - page 75

Assets and liabilities measured at fair value on a recurring basis,
as of October 31, 2015 and 2014, respectively, are summarized
below: 15 RELATED PARTY TRANSACTION
On November 14, 2014, during the first quarter of fiscal 2015, the
Fair company acquired substantially all of the assets (excluding
October 31, 2015 Value Level 1 Level 2 Level 3 accounts receivable) of the BOSS professional snow and ice
management business of privately held Northern Star Indus-
Assets:
Cash and cash equivalents $126,275 $126,275 $ – – tries, Inc., as discussed in Note 2. The purchase price included a
Forward currency contracts 3,173 – 3,173 – cash payment and issuance of an unsecured promissory note in
Cross currency contracts 2,136 – 2,136 – the aggregate principal amount of $30,000. Under the terms of the
Total assets $131,584 $126,275 $5,309 – note, interest will accrue at the rate of 4.0% per year and principal
payments of $10,000 each, together with accrued interest, will be
Liabilities:
Forward currency contracts $ 1,711 – $1,711 – payable on the first, second, and third anniversaries of the closing
Cross currency contracts 134 – 134 – date of the acquisition, subject to certain conditions. Effective as of
Deferred compensation the closing of the acquisition on November 14, 2014, the company
liabilities 1,652 – 1,652 – hired David J. Brule II, who is also a minority shareholder of North-
Total liabilities $ 3,497 – $3,497 – ern Star Industries, Inc., as an executive officer of the company.
Fair
October 31, 2014 Value Level 1 Level 2 Level 3 16 SUBSEQUENT EVENTS
Assets: The company evaluated all subsequent events and concluded that
Cash and cash equivalents $314,873 $314,873 $ – – no subsequent events have occurred that would require recognition
Forward currency contracts 6,030 – 6,030 – in the financial statements or disclosure in the notes to the finan-
Cross currency contracts 831 – 831 –
cial statements.
Total assets $321,734 $314,873 $6,861 –
Liabilities:
Forward currency contracts $ 9 – $ 9 –
Cross currency contracts 536 – 536 – 17 QUARTERLY FINANCIAL DATA (unaudited)
Deferred compensation
Summarized quarterly financial data for fiscal 2015 and 2014 are
liabilities 2,141 – 2,141 –
as follows:
Total liabilities $ 2,686 – $2,686 –
Fiscal year ended
The company measures certain assets and liabilities at fair value October 31, 2015
on a non-recurring basis. Assets acquired and liabilities assumed Quarter First Second Third Fourth
as part of acquisitions are measured at fair value. Refer to Note 2
Net sales $474,211 $826,242 $609,615 $480,807
for additional information. There were no transfers between Level 1 Gross profit 168,999 281,972 216,390 168,574
and Level 2 during the fiscal years ended October 31, 2015 and Net earnings 30,950 93,763 53,324 23,554
2014. Basic net earnings per share
1
.55 1.68 .96 .43
Diluted net earnings per share
1
.54 1.64 .94 .42
As of October 31, 2015, the estimated fair value of long-term
debt with fixed interest rates was $298,541 compared to its carry-
ing amount of $254,452. As of October 31, 2014, the estimated fair Fiscal year ended
October 31, 2014
value of long-term debt with fixed interest rates was $260,970
Quarter First Second Third Fourth
compared to its carrying amount of $223,956. The fair value is
Net sales $445,981 $745,030 $567,540 $414,140
estimated by discounting the projected cash flows using the rate at
Gross profit 163,514 264,540 202,080 143,137
which similar amounts of debt could currently be borrowed. Net earnings 25,869 87,086 50,013 10,902
Long-term debt is a Level 2 liability in the fair value hierarchy. Basic net earnings per share
1
0.45 1.54 0.89 0.19
Diluted net earnings per share
1
0.44 1.51 0.87 0.19
1
Net earnings per share amounts do not sum to equal full year total due to
changes in the number of shares outstanding during the periods and rounding.
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