FAIR VALUE MEASUREMENTS
|6 Months Ended|
Sep. 30, 2019
|Fair Value Disclosures [Abstract]|
|FAIR VALUE MEASUREMENTS||
When applying fair value principles in the valuation of assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company has not changed its valuation techniques used in measuring the fair value of any financial assets or liabilities during the fiscal years presented. The fair value estimates take into consideration the credit risk of both the Company and its counterparties.
When active market quotes are not available for financial assets and liabilities, the Company uses industry standard valuation models. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs including credit risk, interest rate curves, foreign currency rates and forward and spot prices for currencies. In circumstances where market-based observable inputs are not available, management judgment is used to develop assumptions to estimate fair value. Generally, the fair value of our Level 3 instruments are estimated as the net present value of expected future cash flows based on internal and external inputs, including an estimate of the probability of the various scenarios that could occur under each outcome of the Shareholder Approval vote.
Fair Value Measurements
The liabilities and mezzanine equity carried at fair value as of September 30, 2019 and March 31, 2019 were as follows:
There were no transfers in or out of Level 3 for the six months ended September 30, 2019.
Assets and Liabilities Measured at Fair Value on a Non-recurring Basis
In addition to the financial instruments that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a non-recurring basis as required by U.S. GAAP. Generally, assets are recorded at fair value on a non-recurring basis as a result of impairment charges or as part of a business combination. As discussed in “NOTE 11 – Merger Agreement”, during the six months ended September 30, 2019, the Company recorded non-recurring fair value measurements related to the Plan of Merger. These fair value measurements were classified as Level 3 within the fair value hierarchy.
Additionally, the Series E Preferred Stock and Series F Preferred Stock are considered contingently redeemable preferred stock and are classified as mezzanine equity. The fair value of these instruments was estimated as part of the accounting for the Plan of Merger described in “NOTE 11 – Merger Agreement”. As these instruments are not currently redeemable due to the contingencies not being met, the fair value of the instruments will not be adjusted until it is considered probable that those contingencies will be resolved and that the instruments would be redeemed.
The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef