Annual report pursuant to Section 13 and 15(d)

FAIR VALUE ACCOUNTING

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FAIR VALUE ACCOUNTING
 12 Months Ended
Dec. 31, 2014
FAIR VALUE ACCOUNTING [Abstract]  
FAIR VALUE ACCOUNTING

NOTE 8. FAIR VALUE ACCOUNTING

 

FASB ASC Topic 820 “Fair Value Measurements and Disclosures” established a hierarchal disclosure framework associated with the level of pricing observability utilized in measuring fair value. This framework defines three levels of inputs to the fair value measurement process and requires that each fair value measurement be assigned to a level corresponding to the lowest level input that is significant to the fair value measurement in its entirety. The three broad levels of inputs defined by the FASB ASC Topic 820 hierarchy are as follows:

 

• Level 1 Inputs—quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date;
• Level 2 Inputs—inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the full term of the asset or liability; and
• Level 3 Inputs—unobservable inputs for the asset or liability. These unobservable inputs reflect the entity's own assumptions about the assumptions that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances (which might include the reporting entity's own data).

 

As of December 31, 2013, the carrying value of cash and cash equivalents, trade accounts receivables, accounts payable, accrued expenses and accrued interest approximates fair value due to the short-term nature of such instruments.  The carrying value of other long-term liabilities approximates fair value as the related interest rates approximate rates currently available to the company. The following table summarizes the fair value of our financial assets that are measured at fair value:


December 31, 2014
Total Fair Value and
Carrying Value on 		Fair Value Measurement Category  
Balance Sheet Level 1     Level 2     Level 3  
(Dollars in thousands)
Assets:                                
Cash and cash equivalents   $ 33     $ 33     $ —     $ —  
Trade accounts receivable, net     34,781       34,781       —       —  
Fair value of interest rate swap     475       —       475       —  
Liabilities:                                
Accounts payable     2,964       2,964       —       —  
Accrued expenses including estimated fair value of contingent earn-out consideration (see Note 4)     12,704       11,129       —       1,575  
Accrued interest     48       48       —       —  
Long term liabilities including estimated fair value of contingent earn-out consideration (see Note 4)     4,123       2,413       —       1,710  
Long-term debt     277,505       277,505       —       —