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SEC Filings

10-Q
INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-Q on 04/21/2017
Entire Document
 
Notes to Consolidated Financial Statements – (continued)
(Amounts in Millions, Except Per Share Amounts)
(Unaudited)


Note 10:  Fair Value Measurements
Authoritative guidance for fair value measurements establishes a fair value hierarchy which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value:
Level 1
 
Unadjusted quoted prices in active markets for identical assets or liabilities. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
 
 
Level 2
 
Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
 
 
 
Level 3
 
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
Financial Instruments that are Measured at Fair Value on a Recurring Basis
We primarily apply the market approach to determine the fair value of financial instruments that are measured at fair value on a recurring basis. There were no changes to our valuation techniques used to determine the fair value of financial instruments during the three months ended March 31, 2017. The following tables present information about our financial instruments measured at fair value on a recurring basis as of March 31, 2017 and December 31, 2016, and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value.
 
March 31, 2017
 
Balance Sheet Classification
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Assets
 
 
 
 
 
 
 
 
 
Cash equivalents
$
192.5

 
$
0.0

 
$
0.0

 
$
192.5

 
Cash and cash equivalents
Short-term marketable securities
3.1

 
0.0

 
0.0

 
3.1

 
Marketable securities
Long-term investments
0.4

 
0.0

 
0.0

 
0.4

 
Other non-current assets
Total
$
196.0

 
$
0.0

 
$
0.0

 
$
196.0

 
 
 
 
 
 
 
 
 
 
 
 
As a percentage of total assets
1.7
%
 
0.0
%
 
0.0
%
 
1.7
%
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
Contingent acquisition obligations 1
$
0.0

 
$
0.0

 
$
222.5

 
$
222.5

 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
Balance Sheet Classification
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Assets
 
 
 
 
 
 
 
 
 
Cash equivalents
$
440.8

 
$
0.0

 
$
0.0

 
$
440.8

 
Cash and cash equivalents
Short-term marketable securities
3.0

 
0.0

 
0.0

 
3.0

 
Marketable securities
Long-term investments
0.4

 
0.0

 
0.0

 
0.4

 
Other non-current assets
Total
$
444.2

 
$
0.0

 
$
0.0

 
$
444.2

 
 
 
 
 
 
 
 
 
 
 
 
As a percentage of total assets
3.6
%
 
0.0
%
 
0.0
%
 
3.6
%
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
Contingent acquisition obligations 1
$
0.0

 
$
0.0

 
$
205.4

 
$
205.4

 
 
 
1
Contingent acquisition obligations includes deferred acquisition payments and unconditional obligations to purchase additional noncontrolling equity shares of consolidated subsidiaries. Fair value measurement of the obligations is based upon actual and projected operating performance targets as specified in the related agreements. The increase in this balance of $17.1 from December 31, 2016 to March 31, 2017 is primarily due to acquisitions and exercised put options of $15.9, partially offset by payments of $5.3. The amounts payable within the next twelve months are classified in accrued liabilities; any amounts payable thereafter are classified in other non-current liabilities.

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