Fair Value Measurements

3 Months Ended

Sep. 27, 2013

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company's financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The classification of a financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The three levels are as follows:

Level 1 Inputs-Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Generally this includes debt and equity securities and derivative contracts that are traded on an active exchange market (i.e. the New York Stock Exchange) as well as certain U.S. Treasury and U.S. Government and agency mortgage-backed securities that are highly liquid and are actively traded in over-the-counter markets.

Level 2 Inputs-Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, credit risks) or can be corroborated by observable market data.

Level 3 Inputs-Valuations based on models where significant inputs are not observable. The unobservable inputs reflect the Company's own assumptions about the assumptions that market participants would use.

The following tables present the level within the fair value hierarchy at which the Company's financial assets and certain liabilities were measured on a recurring basis as of September 27, 2013 and June 30, 2013:

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 27, 2013

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	—	$	2,298	$	—	$	2,298
Certificates of deposit	—		210		—		210
Municipal bonds	—		758		—		758
Corporate bonds	—		343		—		343
Asset backed securities	—		158		—		158
Money market accounts and cash deposits	790		—		—		790
Total assets	$	790	$	3,767	$	—	$	4,557
Contingent consideration	$	—	$	—	$	1,494	$	1,494
Total liabilities	$	—	$	—	$	1,494	$	1,494

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of June 30, 2013

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	—	$	2,767	$	—	$	2,767
Certificates of deposit	—		212		—		212
Municipal bonds	—		763		—		763
Corporate bonds	—		344		—		344
Asset backed securities	—		172		—		172
Money market accounts and cash deposits	831		—		—		831
Total assets	$	831	$	4,258	$	—	$	5,089
Contingent consideration	$	—	$	—	$	1,365	$	1,365
Total liabilities	$	—	$	—	$	1,365	$	1,365

The Company's long-term debt is not measured at fair value in the condensed consolidated balance sheets. The fair value of debt is the estimated amount the Company would have to pay to transfer its debt, including any premium or discount attributable to the difference between the stated interest rate and market rate of interest at the balance sheet date. Fair values are based on valuations of similar debt at the balance sheet date and supported by observable market transactions when available: level 2 of the fair value hierarchy. At September 27, 2013 and June 30, 2013 the fair value of the Company's debt was not materially different than its carrying value. The Company's restricted investment financial assets as of September 27, 2013 and June 30, 2013 are included within current and long-term restricted investments on the condensed consolidated balance sheets.

Reclassification adjustments for realized gains or losses from available for sale restricted investment securities out of accumulated other comprehensive income are included in the condensed consolidated statement of operations within the insurance recoverables and other income line item.

The Company's contingent consideration liabilities, included in other accrued liabilities on the condensed consolidated balance sheets, are associated with the acquisitions made in fiscal years 2014, 2013 and 2012. The liabilities are measured at fair value using a probability weighted average of the potential payment outcomes that would occur should certain contract metrics be reached. There is no market data available to use in valuing the contingent consideration; therefore, the Company developed its own assumptions related to the achievement of the metrics to evaluate the fair value of these liabilities. As such, the contingent consideration is classified within Level 3, as described below.

Items classified as Level 3 within the valuation hierarchy, consisting of contingent consideration liabilities related to recent acquisitions, were valued based on various estimates, including probability of success, discount rates and amount of time until the conditions of the contingent payments are achieved. The table below presents a rollforward of the contingent consideration liabilities valued using Level 3 inputs for the three months ended September 27, 2013:

Balance at June 30, 2013	$	1,365
Additions for fiscal year 2014 acquisitions	504
Reduction of liability related to re-measurement of fair value	(375		)
Balance at September 27, 2013	$	1,494