Note 11 - Fair Value Measurements

9 Months Ended

Sep. 30, 2011

11. Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. When an asset or liability is required to be measured at fair value, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs using a fair value hierarchy as follows:

Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets.

Level 2: Observable inputs other than quoted prices that are directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets; quoted prices for similar or identical assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

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. Level 3 assets and liabilities include contingent consideration whose fair value is determined using projected income estimates for businesses acquired which require significant management judgment or estimation.

The carrying amount of cash and cash equivalents, receivables, accounts payable and accounts payable floor plan are a reasonable estimate of their fair values due to their short duration.

The Company’s financial instruments measured at fair value on a recurring basis that are subject to the hierarchy disclosure requirements are as follows:

	Level 1		Level 2		Level 3		Total Fair Value
Estimated Contingent Consideration:
Balance at December 31, 2010	$	—	$	—	$	133	$	133
Adjustment of estimate		—		—		15		15
Balance at September 30, 2011	$	—	$	—	$	148	$	148

	Level 1		Level 2		Level 3			Total Fair Value
Estimated Contingent Consideration:
Balance at December 31, 2009	$	—	$	—	$	1,411		$	1,411
Adjustment of estimate		—		—		(254	)		(254	)
Balance at September 30, 2010	$	—	$	—	$	1,157		$	1,157

The Company's other non-financial assets include goodwill, intangible assets and property and equipment, which are classified as Level 3 assets. These assets are measured at fair value on a non-recurring basis as part of the Company's impairment assessments and as circumstances require. The following table summarizes the changes in the fair value of the Company's other non-financial assets resulting from impairment charges recorded during the nine months ended September 30.

	Fair Value Measurements Using
	Quarter Ended September 30,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Total Gains
Description	2011		(Level 1)		(Level 2)		(Level 3)		(Losses)

Goodwill	$	12,490	$	—	$	—	$	12,490	$	(920	)
Intangible assets, net		269		—		—		269		(268	)
Property and equipment, net		5,213		—		—		5,213		—
Total									$	(1,188	)

	Fair Value Measurements Using
	Quarter Ended September 30,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Total Gains
Description	2010		(Level 1)		(Level 2)		(Level 3)		(Losses)

Goodwill	$	13,798	$	—	$	—	$	13,798	$	(594	)
Intangible assets, net		1,201		—		—		1,201		—
Property and equipment, net		4,590		—		—		4, 590		—
Total									$	(594	)

- Definition

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.

+ References

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