Fair Value Measurements of Financial Instruments
For recognition purposes, on a recurring basis, the Corporation is required to measure at fair value its marketable securities, derivative financial instruments, put option liabilities, and auction rate securities. The marketable securities are comprised of money market funds, government securities, corporate bonds, and mutual funds. When available, the Corporation uses quoted market prices to determine fair value and classifies such measurements within Level 1. Where market prices are not available, the Corporation makes use of observable market-based inputs (prices or quotes from published exchanges and indexes) to calculate fair value using the market approach, in which case the measurements are classified within Level 2. Significant unobservable inputs, which are classified within Level 3, are used in the estimation of the fair value of put option liabilities and auction rate securities, determined using a simulation model based on assumptions including future cash flows, discount rates, and volatility. The activity for assets and liabilities measured at estimated fair value using Level 3 during 2025 and 2024 is immaterial.

In connection with the Steelcase acquisition in December 2025, the Corporation acquired Steelcase's auction rate security and foreign exchange forward contracts. See "Note 4. Acquisitions and Divestitures" for more information on the acquisition of Steelcase and "Note 2. Summary of Significant Accounting Policies" for more information on auction rate securities and foreign exchange forward contracts.
Financial instruments measured at fair value were as follows:
Fair value as of measurement dateQuoted prices in active markets for identical assets
(Level 1)
Significant other observable inputs
(Level 2)
Significant unobservable inputs
(Level 3)
Balance as of January 3, 2026
Cash and cash equivalents (including money market funds) (1)$209.2 $209.2 $— $— 
Restricted Cash (3)$8.8 $8.8 $— $— 
Mutual funds (3)$11.7 $11.7 $— $— 
Government securities (3)$7.0 $— $7.0 $— 
Corporate bonds (3)$6.5 $— $6.5 $— 
Foreign exchange forward contracts - assets (2)$2.2 $— $2.2 $— 
Auction Rate Security (3)$2.7 $— $— $2.7 
Interest rate swap derivative - liability (4)$(2.0)$— $(2.0)$— 
Foreign exchange forward contracts - liabilities (4)$(0.4)$— $(0.4)$— 
Put option liability (5)$(5.6)$— $— $(5.6)
Balance as of December 28, 2024
Cash and cash equivalents (including money market funds) (1)$20.2 $20.2 $— $— 
Restricted Cash (3)$2.4 $2.4 $— $— 
Mutual funds (3)$11.6 $11.6 $— $— 
Government securities (3)$6.1 $— $6.1 $— 
Corporate bonds (3)$7.8 $— $7.8 $— 
Interest rate swap derivative - liability (4)$(1.5)$— $(1.5)$— 
Put option liability (5)$(5.9)$— $— $(5.9)
Amounts in parentheses indicate liabilities.

The index below indicates the line item in the Consolidated Balance Sheets where the financial instruments are reported:

(1) "Cash and cash equivalents"
(2) "Prepaid expenses and other current assets"
(3) Current portion - "Short-term investments"; Long-term portion - "Other Assets"
(4) Current portion - "Accounts payable and accrued expenses"; Long-term portion - "Other Long-Term Liabilities"
(5) "Other Long-Term Liabilities"

Historical Timeline

Fiscal YearFiled
2026Mar 3, 2026Showing above
2024Feb 25, 2025
2023Feb 27, 2024
2022Mar 1, 2022
2021Mar 2, 2021
2019Feb 25, 2020
2018Feb 26, 2019
2017Feb 23, 2018
2016Feb 29, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.